Postal Service plans to shuthundreds of its facilities

September 15, 2011

The U.S. Postal Service has yet another plan to save money — but it might make snail mail even slower.

The mail delivery service — facing mounting financial losses that may top $10 billion by month’s end — announced plans Thursday to close hundreds of facilities that sort the mail as part of a four-year effort to cut $20 billion, slash hundreds of thousands of jobs and permanently reshape itself as a leaner organization.

“The sobering reality is that first-class mail volume lost will not return,” said USPS Chief Operating Officer Megan J. Brennan. “People are communicating and paying bills electronically, and we project a continued decline.”

In the past decade, deliveries of first-class mail — the most popular and profitable mode — have plummeted by nearly 50 percent.

Postal officials said Thursday that they no longer need a coast-to-coast delivery network originally established to process first-class mail overnight, preparing envelopes, catalogs and packages that travel only a few ZIP codes away for delivery the next morning.

The USPS plans to review the fate of 252 of its 487 mail-processing facilities in the next three months in hopes of shrinking the number of plants to fewer than 200 by 2013.

The changes would result in the elimination of 35,000 mail-processing jobs, part of a broader plan to cut 150,000 positions by 2015.

Locally, the Postal Service said it will study the fates of four facilities in Maryland — including one in Gaithersburg — and four in central Virginia. Customers will have an opportunity to meet with postal officials in a public setting before final decisions are made, Brennan said.

Feasibility studies of the processing plants are in addition to the possible closure of at least 3,700 post offices nationwide and a push for congressional approval of long-sought reforms.

Lawmakers are considering four competing bills that would generally grant the USPS the flexibility to end Saturday mail deliveries, close post offices based on market conditions and recalculate how much it pays annually into federal retirement, health-care and workers’ compensation funds. Although the USPS is a self-funding entity that doesn’t collect taxpayer money, it is the largest contributor to those accounts.

On Thursday, Rep. Darrell Issa (R-Calif.), who co-wrote one proposal, said closing processing plants “cannot forestall the Postal Service’s financial collapse by itself.” His bill would establish a financial control board to help overhaul postal finances.

Postal worker organizations were also skeptical.

Despite Brennan’s assurances that closing processing plants should be seamless, “I can’t imagine that the change will go unnoticed,” said James F. Killackey III, executive vice president of the National Association of Postal Supervisors.

Killackey, a former USPS official, suggested that businesses relying on overnight first-class mail deliveries to nearby customers might have to wait at least two days for a final delivery. Or turn instead to United Parcel Service or FedEx.

Cliff Guffey, president of the American Postal Workers Union, said the new plans would jeopardize the Postal Service’s unrivaled delivery network, arguably its greatest asset.

Read more on PostPolitics.com and the Fed Page

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Ed O’Keefe is a congressional reporter with The Washington Post and covered the 2008 and 2012 presidential and congressional elections.
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