October 2011


Arkansas Update: Post Offices Off the Closing Lists

October 31, 2011

Word comes from Arkansas today that a dozen post offices, as well as a couple of others we'd heard about previously, have been removed from the list of those in the state being studied for closure under the Retail Access Optimization Initiative.  That's brings to nearly a hundred the number of post offices removed from the RAOI (most of them in Alaska).  

There were 179 Arkansas post offices on the RAOI list, so over 90% remain in jeopardy.  Plus, there are 29 Arkansas post offices on the "non-RAOI" list of 727 offices under closure study (released the day after the RAOI).  Of those, at least 16 have closed or received final determination notices.  

Information continues to trickle in about closings and final determination notices, but it remains difficult to produce complete lists.  As October comes to an end, several more non-RAOI post offices have closed, but no post office on the RAOI list has received a final determination notice yet.  That could change over the coming weeks, since many closure studies got started in early August and they should be completing the 60-day comment period soon.  Final decisions may take only a few days more.

In the meantime, appeals keep coming in at the Postal Regulatory Commission.  They're up to about 150 for the year — about 65 through August, plus 43 in September and 42 in October.  With nearly 600 closings (including final determinations) so far this year, that's a rate of about 25%, which would mean hundreds of appeals over the coming months.  The PRC has posted a "Help Wanted" notice for ten attorneys to help process the "influx" of appeals.

If you have information about a closing or a post office being removed from consideration, please let us know.


 

ARKANSAS POST OFFICES OFF THE RAOI LIST AS OF OCT. 31, 2011

CARTHAGE 112 W OAK ST CARTHAGE AR 71725-9998
CASSCOE 1040 HIGHWAY 33 CASSCOE AR 72026-9998
COLUMBUS 2803 HIGHWAY 73 W COLUMBUS AR 71831-9998
EVANSVILLE 20905 S HWY 59 EVANSVILLE AR 72729-9998
HOT SPRINGS NATL PK 620 CENTRAL AVE STE 1A HOT SPRINGS NATIONAL PARK AR 71901-5302
KNOBEL 260 MAPLE ST KNOBEL AR 72435-9998
LITTLE ROCK 4700 E MCCAIN BLVD LITTLE ROCK AR 72231-9112
LITTLE ROCK 13501 OTTER CREEK PKWY LITTLE ROCK AR 72210-9997
MONTROSE 1400 HIGHWAY 165 N MONTROSE AR 71658-9998
NEW HOPE 5638 HIGHWAY 70 W NEWHOPE AR 71959-9998
ROSSTON 4463 US HIGHWAY 371 ROSSTON AR 71858-9998
ST PAUL 190 5TH ST SAINT PAUL AR 72760-9998
WASHINGTON 211 FRANKLIN ST WASHINGTON AR 71862-9998
WITTS SPRINGS 387 W HIGHWAY 16 WITTS SPRINGS AR 72686-9998

ARKANSAS POST OFFICES AS OF OCT. 31, 2011

[black = closed; brown = final determination posted; green = no longer under closure study]

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(Photo credit: Witts Springs post office)

Philistines at the Gate: The Venice Post Office on the Chopping Block

October 30, 2011

On Monday of this week, Ruth Goldway, chairman of the Postal Regulatory Commission (PRC), will be speaking in Venice, California, at a meeting of the Venice Post Office Task Force.  The subject of the meeting: the fate of the Venice Main Post Office, a beautiful example of New Deal architecture, which the Postal Service has decided to close and sell, a decision now being appealed before the PRC.  The Postal Service has been selling off historic post offices right and left, and it’s really a crime, but no one can stop it.  

For Goldway, the trip to Venice will be something of a homecoming, and she probably knows the Venice post office well.  Though born and raised in New York City, Goldway lived in southern California for over two decades.  During the 1970s, she worked in California’s Department of Consumer Affairs, and from 1979 to 1983, she was a council member and mayor of Santa Monica, which borders Venice.  She subsequently worked in Los Angeles at California State University and the Getty Trust.  Unfortunately, it seems that Goldway's history with Venice has made it necessary for her to recuse herself from the appeals case

The Venice post office was built in 1939 by Roosevelt’s Works Projects Administration.  It’s a beautiful building, and it contains a prized New Deal mural, “First Thirty Years of Venice’s History," by Edward Biberman, a California Modernist whose work appears in the Smithsonian and the National Portrait Gallery.  The mural features Venice’s founder, Abbot Kinney, surrounded by the town he created. 

Normally when the Postal Service wants to close a post office, it has to go through a formal discontinuance process that gives the community an opportunity to express its concerns.  But in this case, the Postal Service says it’s under no legal obligation to go through that process because the “post office” is not really “closing” — it’s just being “relocated" to a carrier annex.

Tell that to the citizens of Venice.  They know a closing when they see one, and they know that closing the Venice post office will do irreparable harm to their community.  They’ve protested to Postal Service officials, formed a task force to organize their efforts, and filed an appeal with the Postal Regulatory Commission. 

The case for the appeal argues that community deserves the full discontinuance procedure because the post office is, for all intents and purposes, closing.  The building will be sold, and the new retail facility in the annex is very small compared to the one at the historic post office.  The brief submitted by James Smith on behalf of the Free Venice Beachhead newspaper describes the post office very nicely and explains how vital it is to the community:

“The [Venice Main Post Office] VMPO was a Works Project Administration building that includes a cornerstone dated 1939.  Thus this historic building has been at the center of Venice community life for 72 years.  It is located on the central plaza in the center of the main commercial district of the town.  It is constantly busy with postal customers arriving on foot, by bicycle and auto.  There is no busier building in the Venice community.  Generations of Venetians have patronized this building on a regular basis throughout their lives.  Upon climbing the stairs or handicap-accessible ramp, they entered an attractive lobby with a deep wood finish.  Their eyes automatically turn to the beautiful and well-preserved “Story of Venice” mural by artist Edward Biberman on the south wall. The mural was painted in 1941 by the famous artist, and is his last surviving mural.  It is seen by hundreds of people per day, thanks to its position in the post office lobby.  The aesthetic charm of the building, and the museum-quality art in the lobby, is beloved by this community which is filled with artists, poets, muralists and connoisseurs of art.  The character of the Venice community as an arts haven means that the blow to the community of losing both the building and the mural is far greater than it would have been if it were a nondescript building that was bereft of art.”

Let the sunshine in: USPS declares an "open door" policy on taping closure meetings

October 26, 2011

Bravo to the Postal Service.  Finally something for which it can be congratulated — a new "open door" policy on video and audio taping of town meetings on post office closures.  Not that it had much choice in the matter.  Prohibiting people form recording the meetings would not have sat well with Congress, the Postal Regulatory Commission, the news media, and the public.  It took a couple of weeks, but the decision was obviously the right one.

On October 7, Ruth Goldway, Chairman of the PRC, sent a formal request to the Postal Service inquiring whether it was "standard Postal Service practice to prohibit audio recordings, video recordings or still photographs from being taken at community meetings," and if so, to provide details about the rationale.  

Apparently the PRC had heard tales of citizens being told by USPS officials running the meetings that the public was not permitted to video or audio tape the meetings, and indeed the Postal Service was able to confirm  "fourteen instances where some restriction was imposed."  These included several discontinuance meetings in Missouri, Mississippi, and Pennsylvania, as well as one in Dewitt, Kentucky, which seems to have been taped anyway by the local news media.  

(By the way, the Postal Service can add to this list of places where the public was denied the opportunity to record the meeting, this example of what happened in Still Pond, Maryland, back in March, as reported for the Kent County News by Craig O'Donnell.)

Today the Postal Service replied to Goldway's information request.  The response states that Postal regulations in Handbook PO-101 do preclude taping of meetings by postal officials "so as not to inhibit discussion by participants."  As for citizens recording the meetings, there has been no official policy, and "decisions on whether to allow or prohibit such practices were made on an ad-hoc basis by postal officials conducting community meetings, often with a primary focus (driven by PO-101) of ensuring that customer inhibition was avoided."

The Postal Service has reviewed the issue, however, and decided to adopt "an open door policy allowing attendees to conduct non-disruptive photography and audiovisual recording at community discontinuance meetings."  

The new policy, the Postal Service, adds does not "change the need for local personnel to maintain order and preventing disruption of meetings."  The Postal Service also noted that "any deviations from the open door policy should be approved by the Area Vice President in consultation with the Vice President, Delivery and Post Office Operations."

Hopefully more meetings will be taped so that there's a complete public record of what's going on.  Videos will also help with appeals cases, since there have been differences of opinion about exactly what was said at some meetings.  

By the way, if you're doing the video, be sure to get good sound.

(Credits: The closing meeting in Dewitt, KY, on October 11, 2011, videotaped by the Dewitt Mountain Advocate.  For more closure meetings on video, visit You-tube. The Sunshine Laws cartoon.)

The Twisted Logic of the Postal Service: Fewer post offices, and more post offices without a postmaster

November 26, 2011

It takes a lot of imagination to destroy an institution as big and durable as the U. S. Postal Service, but the executives in L'Enfant Plaza keep coming up with bold new ideas for doing just that.

Today the Postal Service published its “Final Rule” on “amending its regulations to improve the administration of the Post Office closing and consolidation process.”  The new rules change the definition of ‘‘consolidation’’ and the policy on staffing post offices.  The result will be that thousands of small rural post offices — those offices where one person holds down the fort — will be run by an officer-in-charge on temporary assignment or a non-career PM-replacement with less expertise and training than a postmaster.  The goal, as usual, is cost-savings, and the result, as usual, will be to diminish the quality of service offered by the Postal Service and to send it deeper into its downward spiral.

In July, the Postal Service amended 39 CFR 241 "to improve the administration of the Post Office closing and consolidation process."  These changes permitted a closure study to be initiated at headquarters (“top down”) instead of in the field, streamlined the discontinuance process so that a post office can be closed in less than five months instead of about nine, and granted stations and branches the same closing procedure used for main post offices (the same rules about notifying the patrons, holding public meetings, and providing the right to appeal a closure).

When it made these changes, the Postal Service deferred a decision on two key passages .  These involved the meaning of “consolidation” and the question of whether or not a post office needs to be managed by a postmaster.  Today’s Final Rule addresses those two issues.

 

Redefining "consolidation"

In the past, the term “consolidation” applied to changing the status of a post office from a main post office to a station or branch, as well as to changing the status of a USPS-operated facility into a “contract postal unit” (CPU).  The Final Rule issued today changes the definition of “consolidation” so that, starting December 1, 2011, the term will apply only to converting a USPS-operated retail facility into a contracted unit.

That means the Postal Service can, at will, simply decide that a main, independent post office is now a secondary branch or station.  To the general public, for whom “a post office is a post office is a post office,” whether it’s a main post office or a station or a branch, the change may not seem significant, but it will have many implications that will be felt by postal employees and the public.

The National League of Postmasters and National Association of Postmasters of the U.S. (NAPUS) have argued that the new procedures “erase” the concept of “consolidation” from 39 USC § 404(d) by regulation, when such a change should require Congressional action.  The Postal Service claims it has the right to make the change on its own.  A second objection is that the redefinition would make it easier to close a post office that has lost its “main post office” status, but the Postal Service says that since, as of July, the closing process is the same for all facilities — post offices, stations, and branches — that concern is not relevant.  A third issue may be that the new policy makes it easier to turn a USPS-operated facility into a contract postal unit, but that’s not quite clear yet and it’s not addressed in the Final Rule.

It any case, it is not likely that the postmasters associations and communities who watch their post office turned into a station or branch are going to see it as a non-issue.  It’s the Postal Service, after all, that has spent the last several years arguing with the Postal Regulatory Commission (PRC) that stations and branches are secondary, subsidiary types of facility, not entitled to the statutory protections of a main post office.  Now the Postal Service wants to say it’s no big deal if it turns a post office into a station or branch because there’s essentially no difference. 

Closing procedures are not the only issue.  There are rules governing post offices, for example, that don’t apply to a station or a branch, like hours of operation.  And there’s also the issue of community identity – having a main post office in your town is different from being a branch of some other town’s post office.

The new regulations are also somewhat ambiguous about what’s involved with “consolidating” a post office into a contracted postal facility staffed by non-USPS personnel.  The regulations seem to suggest that there’s a natural progression from main post office to branch or station to contractor-operator facility, as if the services they provide and the training required for managing them were basically the same.  By blurring the difference between a post office and a branch, the Postal Service may also be blurring the distinction between a facility owned and operated by the Postal Service and a contracted facility owned and operated by non-USPS personnel.  The same kind of elision is at work when the Postal Service says a community can replace its post office with a “village post office,” which is not a post office at all. 

 

Staffing a Post Office

The second change in the regulations involves the staffing of post offices.  The postmasters associations believe that the law requires a main post office to be staffed by a postmaster.  They argue that the Postmaster Equity Act (2003) precludes changing 39 CFR 241.1 in a way that would permit a post office to be be managed by someone other than a postmasster. 

The details of the objections posed by the League and NAPUS are explained in the document they prepared back in the spring, when the Postal Service first proposed the change:  “In law, a post office is managed by a postmaster, plain and simple. The proposed regulations conflict with that law. The Senate Committee Report that accompanied the Postmaster Equity Act (Report 108-112) underscores the legal requirement that a post office is managed by a postmaster: ‘Postmasters are the manager-in-charge of the nation’s individual post offices.’  In addition, the report states that postmasters ‘are accountable for postal operations and services, including retail operations and community relations.’ The regulation does not and cannot confer these responsibilities on ‘another type of postal employee.’”

The Postal Service Runs Amok: How Not to Close a Post Office

October 22, 2011

In the classic guidebook for lawyers,The Art of Cross-Examination, Francis Wellman advises, “A lawyer should never ask a witness in cross-examination a question unless in the first place the lawyer knows what the answer would be or in the second place didn’t care.”  This week lawyers for the Postal Service cross-examined Mark Strong, president of the National League of Postmasters, about his testimony before the Postal Regulatory Commission (PRC) concerning the Retail Access Optimization Initiative (RAOI).  (The cross was in addition to written interrogatories submitted to Strong and the League earlier this month.)

If the USPS lawyers knew what Strong’s answers would be, it’s hard to understand why they asked the questions in the first place.  They just gave the League an opportunity to offer up some pretty damning evidence about what’s been going on at the public meetings about closing post offices.   

In response to questions posed by the Postal Service, the League prepared a “Notice of Additional Material” that was added to the PRC docket on Friday.  The material paints a picture of the public meetings that is anything but flattering to the Postal Service, and it cites practices that seem in direct violation of the USPS Discontinuance Guide (Handbook PO-101).  Given that the Postal Service was criticized by an earlier PRC Advisory Opinion for similar problems related to closing post offices back in 2010, it’s somewhat surprising that management isn’t working harder to do a better job this time around.  But it looks like the PRC’s Advisory Opinion on the RAOI will need to offer yet another round of criticisms.

Handbook PO-101 states, “Be sure to schedule the meeting at a time that encourages customer participation, such as during an evening or weekend.”  As widely reported in the media, Strong claimed that public meetings were being held at times difficult or impossible for working people to attend.  The Postal Service asked for evidence, so the League produced numerous emails from postmasters listing when meetings had been scheduled.  In South Dakota 48 out of 75 meetings were held during the workday; in Montana, 18 of 85 were held prior to 5 p.m. on weekdays; and in Illinois and Missouri, there were at least 70 meetings scheduled during the workday.

PO-101 states that at the public meeting, the “District Manager or MPOO [Manager of Post Office Operations, aka POOM] conducts the Management Presentation and provides responses to customer questions.”  In order to make this presentation, it would help if a DM or POOM were actually present at the meeting, but apparently many meetings have taken place with no manager present.  Instead, local postmasters have been told to conduct the meeting and in some cases serve as the minute taker as well.  In Wyoming and Colorado, for instance, there are at least eight cases where no DM or POOM was present; in Missouri, ten; in Arkansas, four.  In Illinois, one POOM apparently told postmasters that he would not be attending any of the town hall meetings, and postmasters have been designated to run them. 

Out of Thin Air: New Numbers on Declining Mail Volumes

October 21, 2011

Someone please give Phil Herr at the GAO a Xanax.  The guy has been focused on USPS doomsday scenarios for so long, it’s apparently making him depressed and clouding his vision.  His new GAO report paints a dire picture of the Postal Service’s future, but it’s based on numbers that seem to be pulled out of thin air.

A few days ago, Herr gave the Senate’s Committee on Homeland Security and Governmental Affairs a new GAO report on the Postal Service entitled “Mail Trends Highlight Need to Fundamentally Change Business Model.”  The report is intended to inform Congressional leaders about how bad the situation is and to provide guidance about what to do.  Its effect, however, will be to heighten the hysteria on Capitol Hill so that only “fundamental” restructuring changes are considered.

And what might those changes be?  The report proposes three: (1) turn the Postal Service into a government-subsidized federal agency (read “taxpayer-funded bail-out”); (2) keep the current structure but give the USPS “additional flexibility” (so that it can “revise” the universal service obligation, outsource more business, close 16,000 post offices, and put 225,000 workers out of work), and (3) privatize the Postal Service completely. 

If you’ve been following Herr’s GAO reports and his testimonies to Congress, there’s not much new here, except perhaps the way privatization is increasingly seen as a viable option.  But the numbers in the report are worth noting.

The report begins, “Total mail volume is projected to decrease by 25 percent, First-Class Mail is expected to decrease by 50 percent, and Standard Mail volume is projected to remain flat. While dire, USPS’s projections could prove optimistic if communication continues to move to digital technologies as quickly as in the recent past.”  Accompanying this prediction is the following table.  

The table indicates the total mail volume for 2020 is projected to be 127 billion pieces.  But where does this number come from?  The “source” simply states, “USPS,” but that doesn’t help much if you want to locate the data or analysis on which the forecast is based.  The sidebar for the GAO report says, “This summary is based on GAO’s past work, including GAO-11-278 (High-Risk Series: An Update) and GAO-10-455 (USPS: Strategies and Options to Facilitate Progress toward Financial Viability).”  But what do we find if we turn to those earlier reports?

Both of these reports state that mail volume in 2020 is expected to be not 127 billion pieces a year, but rather 150 billion pieces.  The “High Risk” report (Feb. 2011) states, “USPS expects mail volume to decline further to about 150 billion pieces by 2020” (page 44).  And the “Strategies and Options” report contains the following chart showing the same thing (page 8):

The Postal Service's 2010 Annual Report projects 2020 mail volume around 152 billion pieces in a "best case" scenario.  This projection is consistent with (and perhaps partly based on) a report done in March 2010 for the USPS by Boston Consulting Group, which also predicted a drop in total mail volume to 150 billion pieces, as seen in the following chart:

The BCG report does state that volumes could drop even further as a result of a “sustained period of zero economic growth” (like Japan’s Lost Decade) or the kind of online diversion experienced in the most "Internet-enabled" European countries.  Similarly, the USPS 2010 annual report says a "worse case" scenario might be as bad as 120 billion pieces.  But these are all "worse-case" scenarios, and the new GAO report says its numbers “could prove optimistic” — in other words, they are not part of a worst-case scenario.  

Yet somehow the Postal Service and the GAO are now predicting a total volume decline far worse than the BCG report and the GAO’s earlier reports, one of which came out just a few months ago.  Has Internet use skyrocketed over the past few months?

A Conflict of Visions: The Pension Dispute, Periodicals Mail, and the Great Postal Debate

October 17, 2011

GUEST POST BY POSTMASTER MARK JAMISON

Two competing visions are defining the great postal debate of 2011. 

The management of the Postal Service, along with the mainstream media and many stakeholders in the mail industry, are advancing a narrative that blames the Internet and postal workers for the “crisis” in the postal system.  The Internet is making the post office “irrelevant,” and workers’ wages and benefits are egregiously out of line with the private sector and other federal workers.  The solution?  Optimize the system by closing post offices and cutting the workforce and benefits. 

There’s an alternative narrative, but it’s not getting much play in the media.  According to this vision, the Postal Service continues to play a vital role in the nation’s social and economic life.  The fault for its financial problems lies not with the Internet or postal workers, but with a Congress addicted to half measures and feckless posturing and with a postal management that’s become a prisoner of its own circular, dead-end thinking. 

Two recent reports – the GAO opinion on the CSRS pension over-funding issue and the PRC-USPS study on cost apportionment for periodical mail — speak to critical elements in the debate about the future of the Postal Service.

 

The GAO report on Pension Responsibilities

The General Accountability Office's report, “Allocation of Responsibility for Pension Benefits between the Postal Service and the Federal Government,” should come as no surprise since it reflects the GAO’s consistently negative appraisal of the reasons for the existence of the Postal Service.  In this case the GAO takes a position contrary to the wishes and desires of the management of the Postal Service, but ironically the GAO conclusions flow logically from the visions expressed by postal management.

Essentially the GAO found that it is just wishful thinking to believe that the Civil Service Retirement System (CSRS) has been over funded as a result of the accounting principles utilized in apportioning pension costs to the old Post Office Department.  The GAO concluded that the original legislation creating the USPS, as well as subsequent legislative efforts, does not sustain the idea that the accounting methods ought to be in any way adjusted.  Their contention is that this is not a matter of equity.  Rather it is solely a matter of policy.

Perhaps the best response to the GAO is offered by Ruth Goldway, Chairman of the PRC, in a letter appended to the report.  Ms. Goldway accurately recounts the various legislative attempts to adjust some of the inequities inherent in the original legislation creating the USPS.  Policy ought to be equitable, she argues, and the thorough analyses offered by both the USPS-OIG and the Segal Group demonstrate clearly that modern accounting procedure comes down solidly in favor of adjusting the calculating methodology and the pension obligations.

Unfortunately, the GAO’s opinion on the subject, though rejected as simply “wrong” by the OIG and the PRC, has grabbed the media headlines and given support to Issa’s Postal Reform legislation.  The Postal Service and all those opposed to the direction postal reform has taken put a great deal of stock in correcting this supposed inequity.  The hope was that if this inequity were corrected, some $50 to $75 billion might move into the Postal Service coffers and make its fiscal picture much rosier.  Now, at least for the time being, those hopes are pretty much dashed.

But the CSRS over-funding issue is actually not central to what’s going on right now.  The operations of the USPS have been essentially break-even over the last five years.  Virtually all of the reported deficits are attributable to two causes: the ridiculous pre-funding schedule for retiree health care and the overages in the FERS system.  Correcting these two problems would be more than enough to set the USPS on a sound financial footing without resorting to draconian layoffs and reductions in service. 

The retiree healthcare pre-funding mandate, established in the 2006 PAEA, was implemented less as a protection against unfunded liabilities than as means to make the bill “score neutral” under the arcane budget rules employed by Congress.  But funding 75 years of health care benefits in ten — at a cost of over $5 billion a year — has proven too great a burden for the Postal Service to bear.

The set-aside for future healthcare benefit now stands at $42 billion, and the Postal Service actually pays those expenses out-of-pocket and current revenues to the tune of $2 billion per year.   As for the FERS, there is no dispute that the Postal Service has over funded this pension fund by $6.9 billion.  Further, it is likely that with the drawdown of employee complement over the last several years, the pension and benefit funds are even more actuarially sound.

The undisputable facts indicate that postal pension and benefit liabilities are more solidly funded than those of virtually any other entity, public or private, in this country.  The bottom line is that even without the CSRS money, the fiscal picture of the Postal Service is not nearly as bad as has been portrayed by postal management, the media, and right-wing ideologues whose agenda demands failure for the Postal Service.

 

The Periodicals Mail Study

For years many have believed that second-class publications — periodical mail — don’t carry their proportional weight in institutional costs.  The recent report from the PRC and USPS, Periodicals Mail Study, seems to confirm that. The question here becomes not how to bring this class of mail into rate compliance but whether it should be brought into compliance at all.

We need a serious discussion in this country about the value of public goods.  As the beginning of the report’s executive summary points out, the distribution of periodical mail was seen as an essential function that promoted our democratic values.  In their book The Death and Life of American Journalism, Robert McChesney and John Nichols discuss journalism as a public good, something that brings value and benefit to society as a whole. To some degree we already recognize that in the context of postal services. We provide special rates for non-profits and free matter for the blind.

Periodical mail — the county newspaper, the news-and-opinion magazine, the journal of scientific thought — are necessary and important parts of our society.  We are told that print is a dying technology and to some degree it is in decline, but it is a technology that has unique properties that we will not easily discard.  Print provides a finite accuracy, a point in time when something was directly recorded in a complete way.  A digital newspaper story may take fifty iterations — which one do we archive?  Print is a neutral technology when distributed through a postal system providing universal service.

As part of our future postal service we need to look at our rate system and structure.  We need to identify and place value on those services we provide that also serve as a public good and we need to identify who and how we will pay for those services.

 

Management’s failed strategy

Over the last twenty years, postal management has embraced a vision of postal services in this country that increasingly seeks to marginalize the principles of universal service in favor of a profit-driven corporate structure designed to serve the needs of a narrow group of “stakeholders” in the mailing industry. 

Management has pushed the vast and complicated set of ideas that are the foundation of the universal service obligation into a very narrow corner of the discussion.  They have been able to convince themselves that the national postal infrastructure has no other purpose but serving narrow business interests, and they have forgotten its primary function — serving the public good.  In doing so, they have given far too much weight to stakeholders who represent a relatively small part of the mailing industry.

This narrow view is an extension of the way we've come to look at business and commerce generally in this country.  We have devoted ourselves to the creation of financial value without a concomitant connection to social value.  When we come to worship at the temple of “money for nothing” — that is, when we use finance as a tool of manipulation rather as the provider and distributor of capital — then we also lose the sense of public and social good arising from commerce. 

When the marketplace becomes a virtual arena devoid of and devolved from any real substance, when traders sitting in their underwear at 3 a.m. simply manipulate the overnight spreads, then we lose contact with the very important concept that work — our participation in the marketplace — has a social value and a public good.  We forget the very purpose of work, the way it occupies, enervates, enriches, and helps us assign value and meaning to life.  The question, as writer Wendell Berry puts it in a 1985 essay, comes down to this: “What are people for?”  It’s a question we must confront, sooner or later.

 

NALC Brings in the Big Guns

October 16, 2011

The National Association of Letter Carriers has apparently decided it’s time to bring in the big guns to defend the interests of its members.  In a press release today, NALC announced that it has retained the services of the investment bank Lazard Group, LLC, and Ron Bloom, former assistant to President Barack Obama for Manufacturing Policy.  Lazard and Bloom will serve “as financial advisors in connection with issues relating to the United States Postal Service.”

NALC President Fredric V. Rolando made the announcement about hiring these advisors to NALC leaders gathered in a national conference to consider the current USPS financial crisis and its long-term challenges.  In the statement, Rolando reiterated the union’s commitment to six-day delivery, universal service, and working cooperatively with USPS management, the Congress, the White House, and stakeholders and constituents.

Lazard is very big-time.  It’s a global investment bank that's been involved with some of the biggest acquisition and merger deals of the past 160 years.  This quote from a New York Times’ review of a book about Lazard entitled The Last Tycoons: The Secret History of Lazard Freres & Co., is a good introduction to the company:

“For more than a century [1860s - 1960s], the legendary firm was considered by many in the clubby world of high finance the quintessence of investment banking, with its aristocratic European hauteur, superlative trans-Atlantic connections and unmatched savoir-faire in the advice it dispensed to ultra-wealthy individual and corporate clients. Although much smaller than better-known rivals like Goldman Sachs, Lazard engendered awe among Wall Street insiders.”

Over the past fifty years, Lazard has “thrived as an adviser to corporations and governments, and at the expense of much larger, WASP-dominated competitors.”  Among its most well known partners is Felix Rohatyn, the investment banker credited with preventing the bankruptcy of New York City in the 1970s.  He’s a long term advisor to the U.S. Democratic Party, and now working as Special Advisor to the Chairman and CEO of Lazard.

Ron Bloom is an old union hand with extensive experience in dealing with just the kind of situation postal workers now find themselves in.  After college, he worked for the Service Employees International Union, but he soon realized that labor unions suffered from a lack of business knowledge, so he enrolled at Harvard Business School, earning an MBA with Distinction in 1985.  From there, he joined Lazard, “where he divided his time between mergers and acquisition, the firm’s principal business, and working with unions whose members were involved in corporate bankruptcies and restructuring transactions (a practice originated by Lazard partner Eugene Keilin).”

Bloom was involved with many big merger-and-acquisition deals, and in 2009 he joined the Obama administration as Senior Advisor to the Secretary of the Treasury on the President’s Task Force on the Automotive Industry and subsequently as the Administration’s Senior Counselor for Manufacturing Policy.  In 2010, he was named as one of Time Magazine’s 100 Most Influential People in the World (in the category of World Leaders).

NALC appears to have chosen wisely in selecting Lazard and Bloom to help broker deals with the Postal Service and Congress.  With hired guns likes these, postal workers may have a chance when the shooting starts at the OK Corral.

(Photo credits: Ron Bloom; Gunfight at the OK Corral.  And there's more on the story at the Federal Eye, here, the Wall Street Journal, here; and the New York Times, here.)

Here Come the Closings, Starting with the A’s

October 15, 2011

Yesterday the Postal Service announced that twenty-one post offices in Alabama would be closing in November and December, and today there’s word that some in Arkansas are closing as well, so it looks like the Postal Service is working its way through the alphabet.   Next week we’ll probably hear about closings in Arizona, California, and Colorado. 

It’s only been a couple of weeks since Save the Post Office published a table summarizing the closings and final determinations for 2011.  It may seem too soon for an update, but a lot has happened in the past few days, so here's an updated table:

CLOSINGS, FINAL DETERMINATIONS, PROJECTIONS FOR 2011
 
LIST
STATUS
Jan.-Aug.
Sept.
Oct.
Nov.
Dec.
Year Total
NOT ON A LIST
Closed
260
4
20
14
20
318
Pending
0
14
20
0
0
0
Suspended
10
10
2
2
2
26
Subtotal
270
28
42
16
22
344
NON-RAOI
Closed
8
3
20
100
135
266
Pending
0
100
135
100
75
175
Suspended
3
2
2
2
2
11
Subtotal
11
195
157
292
212
452
RAOI
Closed
0
0
0
0
50
50
Pending
0
0
50
250
250
500
Suspended
0
2
0
0
0
2
Subtotal
0
2
5
250
300
552
TOTALS
Closed
268
7
40
114
205
634
Pending
0
114
205
350
325
675
Suspended
13
14
4
4
4
39
Total
281
135
249
468
534
1348
APPEALS
 
65
43
41
70
65
284
 

The table reflects several recent developments:

First, earlier this week Postal Service Vice President Dean Granholm told Bloomberg Businessweek — in an excellent article by Angela Greiling Keane — that the Postal Service has already closed 280 post offices this year and another 300 have received final determination notices.  That was a total surprise — about 200 more than Save the Post Office had estimated.  Although we’ve not been able to identify all of these post offices, we’ve updated the table to reflect Granholm’s revelation.  

Then yesterday, the Postal Service released the list of post offices in Alabama that have received final determination notices and will be closing in November and December.  That too was a surprise because it represents a closure rate much higher than anticipated. 

Nearly all of the twenty-one Alabama post offices on yesterday’s list come from the “non-RAOI” list of 727 post offices slated for closure study that the Postal Service released on July 27, 2011, the day after the Retail Access Optimization Initiative (RAOI) was announced.  There are 30 Alabama post offices on this non-RAOI list.  At that rate, about two-thirds of the non-RAOI post offices may close.  We’ve therefore increased the number of these post offices that will close or receive final determination notices by the end of the year from 283 to 441.

ALABAMA POST OFFICE CLOSINGS

Javascript is required to view this map.

(Black flags: closed.  Brown: final determinations issued. List view here.)

The Ed Show, once again, with a helpful commentary

October 13, 2011

With one caveat: Ed blames the Republicans for PAEA and the health-care pre-funding problem, but Democrats can take their share of the blame, too.  Plus, the effort to protect post offices has historically been bipartisan, and it's going to take members of both parties to step up again. Still, a helpful comment from Ed:

Visit msnbc.com for breaking news, world news, and news about the economy

Haste Makes Waste: The Hidden Cost of Closing Post Offices

October 10, 2011

The vast majority of post offices being reviewed for closure are leased properties, and most of them will have months or years left on the lease when they close.  The Postal Service could run into some serious buy-out costs over the coming year, perhaps close to $100 million.

About 250 post offices have closed so far this year, and another 70 or so have received final determination notices, meaning they’ll be closing before the end of the year.  About half of the post offices closing in 2011 had several months, even years, remaining on the lease. There are 166 post offices, closed or closing in 2011, that have at least two months left on the lease, and the total cost for lease buy-outs on these post offices is approximately $10 million.  (Below is the beginning of the list: the complete table is here.)

POST OFFICE
ST
ZIP
STATUS
CLOSE DATE
LEASE EXPIRES
MO. RENT
TOTAL OWED
BELK
AL
 35545-2000
FD
12/1/11
4/30/14
$275
$7,815
LANGSTON
AL
 35755-8231
FD
12/1/11
12/31/14
$1,083
$39,349
LESTER
AL
 35647-4046
FD
11/5/11
5/31/15
$620
$26,060
MOBILE
AL
 36613-3598
CL
6/18/11
5/1/12
$961
$9,858
MONTGOMERY
AL
 36110-9998
CL
3/26/11
4/30/12
$1,200
$15,523
OAKHILL
AL
 36766-9998
FD
12/1/11
9/30/12
$304
$2,983
WATSON
AL
 35181-2000
FD
12/1/11
5/31/13
$275
$4,852
CAMDEN
AR
 71701-7385
FD
12/1/11
4/30/15
$785
$31,552
FAYETTEVILLE
AR
 72704-5221
FD
10/22/11
10/11/12
$400
$4,581
FORT SMITH
AR
 72903-3178
CL
3/26/11
6/12/13
$4,450
$116,133

In addition to those that have already closed, there are 3,600 post offices currently being studied for closure under the Retail Access Optimization Initiative (RAOI).  Of these, there are over 2,100 that could require lease buy-outs.  Assuming March 1, 2012, as the closing date, the total amount owed on leases would be about $77 million.

There are another 727 post offices being studied for closure that appear on a list that came out the day after the RAOI in July.  Some of these “non-RAOI” post offices have already closed, but most are still under study.  About 350 post offices would owe some rent if they closed by March 1, 2012 — over $8 million in total.

That brings the grand total of potential buy-out costs for post offices that could close over the coming months and those that have already closed or received final determinations to about $95 million.

That number is just an estimate, of course, since it’s impossible to know how many post offices will close and exactly when.  But there’s another factor that we don’t know about — how many of those post offices have leases with “early termination” clauses? 

In order to avoid buy-out costs, the Postal Service has apparently been pressuring lessors to include an “early-out” clause in new leases so that the it can terminate the lease with three or four months’ notice, with no obligation to pay off the months or years remaining on the lease.  The mere fact that the Postal Service is doing this is yet further evidence, as if we needed it, that the Postal Service has plans to close many more post offices in the future. 

Lessors don’t like the clause because it makes it difficult to plan ahead, and it can complicate matters with mortgage lenders, who also like to know that the tenant will be sticking around until the end of the lease.  But if a lessor objects to including the early-out, the Postal Service can say there’s “a problem with the lease,” declare an “emergency suspension,” and close the post office on the spot.  Lease problems are one of the most common reasons for suspending a post office, and the practice has been the subject of an on-going investigation by the Postal Regulatory Commission (PRC). 

The issue of lease buy-out costs has also come up in at least one appeals case before the PRC.  A few months ago, the community of Akron, Ohio, appealed the decision to close its post office.   There were two years left on the lease when it closed, and that cost the Postal Service nearly $200,000.  PRC Chairman Ruth Goldway cited the buy-out costs in a dissenting opinion that challenged her colleagues’ ruling to affirm the Postal Service’s decision to close the post office.  Apparently perplexed why the Postal Service was buying out the lease when it would have been less expensive to keep the post office open until the lease ran its course, Goldway wrote that “in my view, the final determination does not offer a rational explanation of why the Postal Service would make a determination to close this facility despite the closing’s negative impact on the Postal Service’s finances.”

Expecting the Postal Service to provide a rational explanation for its decisions may be asking too much.  Nothing the Postal Service does makes any sense.

Consider that in Palm Beach, Florida, the Postal Service recently sold off a beautiful New Deal post office that it owned outright and moved the post office to an expensive strip mall, where the rent is rumored to be $10,000 a month. 

The Hidden Cost of Closing Post Offices: Lease Buy-Outs

RENT OWED ON POST OFFICES CLOSED OR CLOSING IN 2011

POST OFFICE
ST
ZIP
STATUS
CLOSE DATE
LEASE EXPIRES
MO. RENT
TOTAL OWED
BELK
AL
 35545-2000
FD
12/1/11
4/30/14
$275
$7,815
LANGSTON
AL
 35755-8231
FD
12/1/11
12/31/14
$1,083
$39,349
LESTER
AL
 35647-4046
FD
11/5/11
5/31/15
$620
$26,060
MOBILE
AL
 36613-3598
CL
6/18/11
5/1/12
$961
$9,858
MONTGOMERY
AL
 36110-9998
CL
3/26/11
4/30/12
$1,200
$15,523
OAKHILL
AL
 36766-9998
FD
12/1/11
9/30/12
$304
$2,983
WATSON
AL
 35181-2000
FD
12/1/11
5/31/13
$275
$4,852
CAMDEN
AR
 71701-7385
FD
12/1/11
4/30/15
$785
$31,552
FAYETTEVILLE
AR
 72704-5221
FD
10/22/11
10/11/12
$400
$4,581
FORT SMITH
AR
 72903-3178
CL
3/26/11
6/12/13
$4,450
$116,133
GOODWIN
AR
 72340-9998
CL
8/1/11
11/30/11
$90
$351
IDA
AR
 72546-9998
FD
12/1/11
8/31/12
$250
$2,210
LITTLE ROCK
AR
 72206-6729
CL
2/11/11
5/30/16
$3,164
$197,495
PEACH ORCHARD
AR
 72453-9998
FD
12/1/11
5/31/15
$475
$19,567
BERKELEY
CA
 94702-2510
CL
4/30/11
7/31/12
$700
$10,342
BRYN MAWR
CA
 92318-0200
FD
10/28/11
5/31/14
$1,167
$35,602
LA MESA
CA
 91942-9997
FD
12/1/11
11/30/15
$8,173
$384,910
OAKLAND
CA
 94612-9994
CL
5/20/11
10/30/11
$1,623
$8,535
RICHMOND
CA
 94804-1946
CL
5/31/11
8/15/15
$3,250
$161,137
SAN BERNARDINO
CA
 92408-9997
CL
8/12/11
3/31/13
$7,000
$134,806
SAN DIEGO
CA
 92104-9998
CL
7/2/11
10/31/14
$9,450
$370,989
SAN JOSE
CA
 95116-9998
CL
3/31/11
6/9/11
$20,833
$47,043
NORTH CANTON
CT
 06059-9991
FD
10/29/11
9/30/14
$600
$20,652
POMFRET CENTER
CT
 06259-9998
FD
12/1/11
8/31/12
$2,200
$19,445
FT MYERS
FL
 33901-8121
CL
10/7/11
11/30/13
$5,360
$135,729
KISSIMMEE
FL
 34746-9991
CL
4/23/11
9/30/12
$321
$5,441
MIAMI
FL
 33151-9998
CL
6/4/11
12/31/14
$848
$35,704
NAPLES
FL
 34108-8709
CL
5/2/11
10/21/12
$7,783
$135,078
PANAMA CITY
FL
 32404-7261
CL
5/29/11
9/30/14
$3,780
$148,761
ST PETERSBURG
FL
 33714-9998
CL
1/28/11
4/10/13
$20,622
$534,168
ST PETERSBURG
FL
 33706-4334
CL
6/17/11
4/30/15
$1,000
$45,581
CANTON
GA
 30114-9997
CL
8/1/11
10/14/11
$2,594
$6,192
MACON
GA
 31206-3669
CL
2/15/11
4/30/12
$5,833
$82,796
SAVANNAH
GA
 31407-9998
CL
2/28/11
9/30/12
$1,235
$23,103
SAVANNAH
GA
 31407-9998
CL
2/28/11
9/30/12
$1,235
$23,103
CARPENTER
IA
 50426-5000
CL
12/4/10
9/30/15
$325
$18,462
CHILLICOTHE
IA
 52548-9014
FD
12/1/11
11/30/13
$264
$6,217
DES MOINES
IA
 50316-1200
CL
4/29/11
8/31/11
$2,617
$10,467
LINCOLN
IA
 50652-5000
FD
12/1/11
10/31/13
$550
$12,419
MASONVILLE
IA
 50654-8533
FD
12/1/11
2/28/13
$275
$4,036
MC INTIRE
IA
 50455-8046
CL
5/7/11
7/31/11
$430
$1,179
MORLEY
IA
 52312-8800
CL
4/22/11
8/31/13
$130
$3,615
OTTOSEN
IA
 50570-8751
FD
12/1/11
5/31/15
$400
$16,477
SHARPSBURG
IA
 50862-9900
FD
12/1/11
3/31/15
$200
$7,845
WATERLOO
IA
 50707-9715
FD
12/1/11
1/31/16
$1,600
$78,555
WEBSTER
IA
 52355-9081
CL
4/22/11
11/30/12
$200
$3,794
BURNT PRAIRIE
IL
 62820-9997
FD
12/1/11
6/30/13
$288
$5,351
CHICAGO
IL
 60649-9997
CL
5/14/11
6/30/12
$1,625
$21,649
STOY
IL
 62464-9998
FD
12/1/11
5/31/15
$260
$10,710
EAST CHICAGO
IN
 46312-3342
CL
7/2/11
7/31/13
$1,280
$31,383
INDIANAPOLIS
IN
 46231-9998
CL
7/2/11
12/31/12
$627
$11,084
VELPEN
IN
 47590-9998
FD
12/1/11
11/30/15
$500
$23,548
HOLMES MILL
KY
 40843-9998
CL
5/7/11
4/30/13
$250
$5,839
LOUISVILLE
KY
 40218-9998
CL
6/24/11
3/12/18
$4,800
$379,819
LOUISVILLE
KY
 40218-9998
CL
6/24/11
3/12/18
$4,800
$379,819
RENFRO VALLEY
KY
 40473-9998
CL
8/1/11
9/17/15
$230
$11,188
SITKA
KY
 41255-9998
CL
7/17/11
6/30/12
$210
$2,364
TEMPLEVILLE
MD
 21670-9998
FD
12/1/11
7/31/15
$300
$12,948
PENOBSCOT
ME
 04476-9998
CL
8/1/11
10/4/14
$1,026
$38,383
BRANT
MI
 48614-9800
CL
8/20/11
7/31/14
$440
$15,272
DEARBORN
MI
 48128-9998
CL
6/25/11
12/13/14
$5,000
$204,355
DETROIT
MI
 48202-3016
CL
8/1/11
2/28/14
$2,042
$62,040
DETROIT
MI
 48202-3016
CL
6/25/11
2/28/14
$2,042
$64,477
TURNER
MI
 48765-9800
CL
8/20/11
11/30/14
$510
$19,709
TWINING
MI
 48766-9800
CL
8/1/11
7/31/14
$525
$18,544
WHEELER
MI
 48662-9800
CL
9/10/11
8/31/13
$812
$18,886
COATSVILLE
MO
 63535-9998
CL
7/30/11
1/31/12
$270
$1,611
IONIA
MO
 65335-9998
FD
12/1/11
10/31/15
$292
$13,454
KANSAS CITY
MO
 64155-9979
CL
8/1/11
10/17/12
$3,369
$48,141
LATHAM
MO
 65050-1000
FD
12/1/11
1/31/16
$345
$16,938
LURAY
MO
 63453-9998
CL
8/1/11
10/3/15
$340
$16,715
ALGOMA
MS
 38820-9998
FD
12/1/11
8/31/15
$330
$14,573
GASTONIA
NC
 28052-1249
CL
7/16/11
9/30/13
$1,208
$31,456
HIGH POINT
NC
 27263-1607
CL
3/26/11
7/31/11
$1,624
$6,653
JACKSONVILLE
NC
 28540-5934
CL
5/28/11
8/31/14
$650
$24,973
MINNEAPOLIS
NC
 28652-9800
CL
8/1/11
4/30/15
$400
$17,652
REX
NC
 28378-8901
CL
8/1/11
5/31/18
$300
$24,145
MANNING
ND
 58642-9998
CL
6/30/11
9/30/14
$381
$14,610
PALERMO
ND
 58769-9998
CL
8/1/11
11/30/15
$365
$18,627
LINCOLN
NE
 68503-9998
CL
5/6/11
2/28/12
$7,215
$69,355
OMAHA
NE
 68110-2281
CL
4/29/11
8/31/12
$880
$13,910
BRIDGETON
NJ
 08302-5997
CL
3/25/11
2/29/12
$874
$9,614
BRIDGETON
NJ
 08302-1900
CL
2/25/11
6/30/14
$2,100
$82,713
CAMDEN
NJ
 08104-1000
CL
6/17/11
3/31/15
$626
$27,935
CLEMENTON
NJ
 08021-6376
FD
10/7/11
5/31/13
$950
$18,448
JOHNSONBURG
NJ
 07846-9800
CL
8/1/11
8/31/12
$667
$8,516
NEWARK
NJ
 07102-5424
CL
7/1/11
2/9/13
$6,531
$124,086
NEWARK
NJ
 07102-9714
CL
7/1/11
1/31/16
$3,239
$175,019
TRENTON
NJ
 08620-9998
CL
5/20/11
3/31/13
$2,787
$61,217
TRENTON
NJ
 08611-9997
CL
7/1/11
9/30/18
$2,047
$174,885
WILLINGBORO
NJ
 08046-3400
CL
2/11/11
8/31/12
$1,524
$27,874
ALBANY
NY
 12208-2201
CL
4/30/11
3/31/14
$1,625
$55,879
ALBANY
NY
 12204-9997
CL
3/25/11
1/13/20
$3,375
$350,129
BRONX
NY
 10460-9991
CL
4/22/11
12/31/12
$2,271
$45,343
BRONX
NY
 10455-9991
CL
4/22/11
9/30/14
$3,446
$139,730
CATTARAUGUS
NY
 14719-9998
CL
8/1/11
5/31/15
$3,750
$169,234
CLARKSVILLE
NY
 12041-1223
FD
12/1/11
9/30/13
$865
$18,671
CLIMAX
NY
 12042-2100
FD
12/1/11
10/3/14
$578
$19,318
FISHERS LANDING
NY
 13641-9998
FD
12/1/11
4/14/18
$350
$26,261
FLUSHING
NY
 11372-9993
CL
8/1/11
6/30/14
$3,500
$120,129
GLENS FALLS
NY
 12803-9998
CL
9/9/11
9/30/13
$2,373
$57,552
HAILESBORO
NY
 13645-9998
FD
12/1/11
12/31/13
$565
$13,870
JORDANVILLE
NY
 13361-9998
FD
12/1/11
2/29/12
$550
$1,597
LEONARDSVILLE
NY
 13364-9998
FD
12/1/11
5/31/13
$575
$10,146
LORRAINE
NY
 13659-9998
FD
12/1/11
7/31/13
$400
$7,845
MARTINSBURG
NY
 13404-9998
FD
12/1/11
12/31/12
$350
$4,471
MERIDIAN
NY
 13113-9998
FD
12/1/11
8/31/14
$532
$17,241
OLD CHATHAM
NY
 12136-9998
FD
12/1/11
12/31/12
$752
$9,607
REDFIELD
NY
 13437-9800
FD
12/1/11
6/30/12
$419
$2,867
SMYRNA
NY
 13464-9998
FD
12/1/11
8/31/14
$742
$24,020
SYRACUSE
NY
 13212-9211
CL
1/14/11
3/31/11
$1,546
$3,790
SYRACUSE
NY
 13207-9211
CL
1/28/11
9/14/16
$994
$65,925
WEST LEYDEN
NY
 13489-9998
FD
12/1/11
1/31/12
$868
$1,707
WEST STOCKHOLM
NY
 13696-9998
FD
12/1/11
6/30/14
$517
$15,700
WOODGATE
NY
 13494-9998
CL
8/1/11
10/31/11
$1,100
$3,229
AKRON
OH
 44320-9998
CL
2/19/11
7/31/11
$3,927
$20,522
AKRON
OH
 44305-9998
CL
6/18/11
9/30/12
$8,325
$126,218
AKRON
OH
 44310-1814
CL
4/23/11
9/30/12
$1,139
$19,318
AKRON
OH
 44308-9998
CL
6/4/11
11/30/14
$1,192
$49,012
CANTON
OH
 44706-9998
CL
6/18/11
9/30/15
$7,039
$355,356
CINCINNATI
OH
 45227-1814
CL
8/1/11
5/31/14
$570
$19,023
CINCINNATI
OH
 45225-9998
CL
8/1/11
11/30/15
$935
$47,715
CINCINNATI
OH
 45242-9997
CL
1/31/11
6/30/15
$352
$18,293
CLEVELAND
OH
 44142-9998
CL
5/21/11
11/19/11
$5,725
$33,611
CLEVELAND
OH
 44111-4050
CL
6/4/11
4/30/12
$1,747
$18,650
CLEVELAND
OH
 44123-9998
CL
2/19/11
8/31/12
$1,833
$33,059
CLEVELAND
OH
 44107-3011
CL
3/26/11
3/15/14
$1,644
$57,523
CLEVELAND
OH
 44137-2590
CL
7/16/11
11/13/15
$6,284
$320,484
DAYTON
OH
 45440-1000
CL
5/27/11
9/30/11
$3,542
$14,395
DAYTON
OH
 45402-9904
CL
4/29/11
5/31/13
$1,150
$28,305
MANSFIELD
OH
 44905-9998
CL
8/1/11
1/31/13
$1,915
$33,914
WEST ELKTON
OH
 45070-9998
FD
12/1/11
6/30/15
$366
$15,431
YOUNGSTOWN
OH
 44506-9998
CL
5/21/11
10/31/12
$680
$11,604
OKLAHOMA CITY
OK
 73106-9998
CL
4/29/11
12/31/11
$1,458
$11,573
CRESCENT LAKE
OR
 97733-9799
CL
8/1/11
1/31/14
$430
$12,678
PORTLAND
OR
 97201-3405
CL
8/1/11
2/14/13
$47,915
$870,189
CRANBERRY
PA
 16319-3000
CL
8/1/11
12/31/11
$699
$3,429
ERIE
PA
 16510-1700
CL
4/22/11
11/30/12
$2,000
$37,935
HAVERTOWN
PA
 19083-9997
CL
6/17/11
1/31/13
$2,500
$47,903
JOHNSONBURG
PA
 15845-1295
CL
8/1/11
4/30/13
$4,485
$92,304
NEW RINGGOLD
PA
 17960-9998
CL
8/1/11
10/16/15
$908
$45,019
NORTH WALES
PA
 19436-9998
CL
8/1/11
10/31/13
$415
$11,004
PHILADELPHIA
PA
 19124-9995
CL
4/22/11
8/24/11
$6,000
$24,000
PHILADELPHIA
PA
 19148-9996
CL
4/22/11
11/30/11
$6,167
$44,161
PHILADELPHIA
PA
 19123-9997
CL
4/22/11
12/1/14
$2,535
$107,851
PHILADELPHIA
PA
 19135-9997
CL
4/22/11
3/31/15
$1,000
$46,419
PITTSBURGH
PA
 15204-9998
CL
4/22/11
4/30/13
$340
$8,105
READING
PA
 19609-9998
CL
8/1/11
4/30/14
$2,500
$80,887
SCRANTON
PA
 18519-1553
CL
5/27/11
2/28/15
$786
$34,794
UPPER DARBY
PA
 19082-9997
CL
6/17/11
2/28/14
$2,750
$87,556
YORK
PA
 17406-9800
CL
8/1/11
12/31/14
$775
$31,200
PAWTUCKET
RI
 02864-9991
CL
7/9/11
4/30/13
$2,517
$53,664
BEN FRANKLIN
TX
 75415-9998
CL
8/1/11
12/31/13
$300
$8,545
DALLAS
TX
 75235-9998
CL
2/19/11
3/31/14
$3,667
$134,366
PRAIRIE HILL
TX
 76678-9998
FD
12/1/11
11/30/13
$1,760
$41,441
PRAIRIE HILL
TX
 76678-9998
CL
8/1/11
11/30/13
$726
$19,953
ROSSER
TX
 75157-9998
CL
8/1/11
1/4/15
$500
$20,194
SAN ANTONIO
TX
 78207-9998
CL
4/22/11
6/30/12
$3,833
$53,790
PETERSBURG
VA
 23803-2408
CL
5/7/11
5/31/14
$850
$30,710
PIMMIT
VA
 22043-9998
FD
11/10/11
10/31/12
$6,556
$75,292
PORTSMOUTH
VA
 23702-9998
CL
8/1/11
3/31/14
$985
$30,916
LA GRANDE
WA
 98348-9800
FD
12/1/11
12/31/12
$6
$70
AUBURN
WV
 26325-9998
FD
12/1/11
10/31/13
$55
$1,236
CHARLESTON
WV
 25309-9998
CL
5/28/11
9/14/12
$2,427
$37,184
CHARLESTON
WV
 25311-9998
CL
3/30/11
8/31/13
$3,358
$95,875
FREEDOM
WY
 83120-9901
FD
12/1/11
1/31/14
$154
$3,939
TOTAL
 
 
 
 
 
 
$10,001,882

This table lists post offices that have closed (CL) or received Final Determination notices (FD) since January 1, 2011.  The lease data come from the USPS website's facilities reports, here.  The sources for the closing data are from the USPS Postal Bulletins, news reports, and other sources.  The  For some facilities,  it was not possible to find a closing date, so the table uses August 1, 2011 (most closed before that, so the amount due on the lease would be even greater than indicated here).  For those that received a Final Determination in September, the table uses December 1, 2011, as the closing date. 

The Internet Myth: Why Email Isn't Killing Snail Mail

October 7, 2011

The New York Times finally gets it right — an article that explains how the Internet is not the cause of the Postal Service’s woes.  It’s called “Why the Internet Isn't the Death of the Post Office,” and it’s written by James Fallows, a highly respected, award-winning author and journalist.  Unfortunately for the Times, Fallows’ article was published on September 4, 2005.  You’ll be hard pressed to find anything in the paper written over the past year that gets anywhere near this close to the truth.

“The eclipse of ‘snail mail’ in the age of instant electronic communication has been predicted at least as often as the coming of the paperless office,” writes Fallows, but the predictions of the death of the mail are just not coming true.   Fallows doesn’t mention it, but here’s an example of the kind of bogus prediction he’s talking about: A 1976 GAO report warned of declining “demand for traditional postal services” due to increases in “electronic funds transfer” and “the use of computer terminals for direct exchange of information.”  We’re talking 1976 — who even had a computer terminal back then?  But it wasn’t too soon for the doomsayers to prophesy the End of the Post Office.

“The harmful side of the Internet's impact is obvious but statistically less important than many would guess,” writes Fallows.  People are naturally writing fewer letters, he explains, but that started fifty years ago with the telephone, and besides, household-to-household correspondence accounts for less than one percent of first-class mail. 

So just because you’re not sending old-fashioned letters very often doesn’t mean the Internet is killing the Post Office.  In many ways, Fallows notes, the Internet is actually helping the Postal Service by contributing to an increase in many types of mail — prescription drugs, eBay items, catalogs, Netflix videos, credit card solicitations, and so on.

Fallows’ article may be dated 2005, but it’s still on the money as far as the Internet Myth is concerned.  Yes, the Internet is growing, and electronic bill paying and email are causing a decline in first-class mail, but overall, the impact of the Internet on the Postal Service revenues is relatively small.  The real reason for the declines of the past four years is obvious — the recession.

Granted, it is difficult distinguishing between the impacts of the Internet and the impacts of the recession, especially because they vary for the different types of mail and because they are linked in many ways.  For example, when the recession pushes a business to switch some of its print advertising budget over to the Internet, what’s the cause of the decline in its use of the mail, the recession or the Internet? 

A study done earlier this year called “Approximating the Impact of Substitution and the Recession on Postal Volume” addressed the question of impacts and came up with some interesting conclusions.  Robert Cohen and Charles McBride, two independent postal consultants, each with over 35 years in the business, examined the impacts of the recession and “Internet substitution” on various types of mail.  They concluded that standard regular mail was the category hardest hit by the recession — down 25%, from 2007 to 2009 — while single-piece first-class was the category most affected by Internet substitution and least affected by the recession — down about 5% a year over the period 2000 to 2009.  Bulk first-class mail actually grew during 2000 to 2006 and only started to decline in 2007, when the economy started to slow down.  And that’s true of mail volumes overall, which peaked in 2006 – 2007 at about 212 billion pieces a year.

If you look at first-class mail overall for the past ten years, you’ll find this:

For the first seven years of the decade, the average annual decline was about 1% a year.  That’s because while single-piece first-class was declining at 5% annually, bulk first-class was increasing and making up for most of the losses.  Then the recession hit, and bulk first-class began declining at a rate far greater than single-piece, so average declines for 2008 to 2010 were 6.7% for first-class overall.

Given that nothing special happened in the world of email and online bill paying in the period 2007 to 2010, it’s likely that the average annual decline of 1% due to electronic divergence continued during this period.  Thus, only about 4% of the 22% decline for 2007 - 2010 should be attributed to the Internet.  The recession can take the credit for the remaining 18%.

But what do we read in this week’s Wall Street Journal?  “The rapid growth of email, online bill paying and the like has reduced the volume of first class mail by 22% since 2006, cutting into the government's monopoly.  An inexorable decline is underway.” 

The 22% figure may be correct, but that’s cherry-picking the data and attributing the wrong cause to the decline.  Now why would the Wall Street Journal want to do something like that?  And why are we seeing this sort of thing all over the media landscape?

Post Office Closings: Updated List and Projections

October 3, 2011

The pace of post office closings and appeals is picking up, and it’s only going to get worse over the coming months.  If Congress doesn’t do something soon, by the end of the year we’re going to see post offices closing at a rate of several per day.  

An updated list of the post offices that have closed, been suspended, or received a final determination (closure "pending") is here, and a map view is here.   The following chart summarizes what's happened over the past nine months and offers some projections about what we're likely to see over the rest of the year.

POST OFFICES CLOSED, SUSPENDED, CLOSURE PENDING: OCT. 1, 2011 

ABOUT THE NUMBERS:

The data for the first nine months of the year are approximations because the Postal Service has not been providing closing lists or updates.  The numbers are based lists we've compiled using news accounts, the PRC website, and other sources.  The projections for October through December are based on several factors, as described below.  (See Correction at the end.)

NOT ON A LIST: Many post offices were initiated for closure study back in 2009 and 2010, and during the first eight months of 2011, many of them finally closed.  There are probably a few more that may still close, but most of those currently being studied for closure appear on one of the following two lists.  Hence projections for the rest of the year in this category are minimal.  

NON-RAOI LIST: On July 27, 2011, the Postal Service released a list of 727 post offices that had been initiated for closure study and that had progressed to the public hearing stage before the RAOI list was released.  These include main posts offices that were on the "old system," under which it took nine months to close a facility, and many were stations and branches, which the Postal Service could close in far less time.  Many of these facilities were initiated for study in late 2010 or early 2011, so they are now entering the final stage of the process.  In September, many received Final Determination notices, and the rate should increase over the coming months, but we have kept the projections conservative, about 75 a month.  

RAOI LIST:  On July 26, 2011, the Postal Service released a list of 3,652 post offices being studied for closure under the Retail Access Optimization Initiative (RAOI).  Some 82 have been removed from the list, but most of them are well along in the process, and they are on the "new system," which requires less than five months for the closure process.  The process began for some of them in late July and early August, so the first of these should begin receiving Final Determination notices in mid-October, and some will close by the end of the year.  The projections are based on news accounts, which indicate that public hearings are taking place at a frenetic pace.  Postal operations managers (POOMs) are sometimes doing three in one day.

PENDING: This category refers to post offices that have received a Final Determination notice, which means they'll probably close in 60 days unless they are successful with an appeal.  The totals for the "pending" category on the far right estimate how many will still be pending at year's end, not the total that received Final Determination notices.  (In other words, if a post office closes before the end of the year, it is not included in the total "pending" number, which is why some of the totals look askew.)

SUSPENSIONS: The Postal Service can close a post office on very short notice as an "emergency suspension" — the building is unsafe, there's a staffing problem, or there's an issue with the lease.  For example, in Jewell, Georgia, the post office was closed without notice because there was no one to run it, and in Kneeland, California, there was a problem with the lease that the property owner blamed on the Postal Service — communications, he said, were "lax, making it difficult to renegotiate the lease.”  These suspensions are not supposed to be permanent closings, but they usually turn into that.  Also, a post office being studied for closure can be suspended as well, as is the case with a couple of those on the chart.

Setting the Record Straight, part one: The Postmaster Takes the National Review to School

October 2, 2011

The Oct. 3 issue of the National Review has an article by Robert VerBruggen entitled “Dead Letter - Tough Unions, Weak Management Doom the USPS.”  The National Review Online is subscription only, so you're spared having to read it, but if you want a taste of VerBruggen, you can check out some of his earlier pieces, like “Yes, End the Postal Service” and  “Post Office Creeps Closer to Default.”

You can tell from the titles where VerBruggen is coming from.  His most recent piece recycles the usual misinformation about postal issues: It mischaracterizes the $5.5 billion pre-funding payment for retiree health care benefits, blames the unions for postal ills, sets up a bogus comparison between the USPS and FedEx and UPS, and, not surprisingly, concludes that the USPS must be privatized.

VerBruggen’s piece was too much for one postmaster to take.  The following is a “letter to the editor” written by Mark Jamison, a postmaster in North Carolina.  (Jamison has also written an excellent letter to the PRC for its Advisory Opinion on the Retail Access Optimization Initiative, which you can read here.)  

*  *  *  *  *  *  * 

Dear Editor, National Review:

Robert VerBruggen demonstrates a tremendous amount of ignorance with respect to the issues relating to the USPS.  Perhaps it’s because he wants to advance an ideological agenda or perhaps it’s because he is simply uninformed.  It doesn’t really matter since the result is the same — an uninformed and distorted piece of tripe.

First, let’s correct a couple of errors and distortions in Mr. Verbruggen’s article: 

The USPS pays into two retirement funds for its employees.  The older is the Civil Service Retirement System (CSRS) fund.  It has received funding of between $50 and $75 billion dollars in excess of its actuarial requirements. To be fair, there is some dispute about these overcharges.  When the Post Office was removed as a cabinet department by the 1971 Postal Reorganization Act, provisions were made to fairly distribute future payments to retirees and those who had worked under the old system.  Retirement accounting was in its infancy then, so certain decisions regarding the proper apportionment of responsibility for old Post Office Department employees were left unclear.

In subsequent years legislation clarified some of these responsibilities, and based on currently accepted accounting procedures, the Postal Service appears to have been overcharged for those employees who worked for the old Post Office Department. The USPS OIG, the GAO and the Siegel Group, under contract to the Postal Regulatory Commission (PRC), have all determined that the methodology used by the Office of Personnel Management (OPM) to calculate the USPS liabilities is incorrect; only the amounts of the overcharges differ.

The second retirement fund, the Federal Employees Retirement System (FERS), contains employees who began after 1984. There is no dispute that the Postal Service has over funded its obligations to FERS by $6.9 billion.

Setting the Record Straight, part two: The NY Times Does It Again

October 2, 2011

The New York Times does it again.  Not a word, not one, about the hundreds of “Save America’s Postal Service” rallies that took place across the country on September 27, and then today it publishes an article with the usual mainstream-media slant and uncritical repetition of Postal Service PR.  It's by Randall Stross, a business professor at San Jose State University, a regular for the Times but someone who does not appear to be an expert on the postal system.  It’s hardly worth going through one of these articles again, but here we go.

The article, which is entitled “Reading the Writing on the Envelope,” begins with what the professor probably thought was a very clever reference to the Pony Express, which lasted only 18 months, done in by the telegraph.  The thesis is clear from the start — the Postal Service will go the way of the Pony Express because of the Internet: “Now, 150 years later, the United States Postal Service is engaged in another race with technology, one it can’t possibly win.   But because the service is a quasi-independent government agency, it continues to maintain the huge human and mechanical infrastructure that was assembled for a pre-Internet age.”

In other words, the Postal Service is doomed for two reasons: one, the Internet, and two, it’s a government agency.  So we don’t need the postal system anymore because we have email and electronic bill paying, and by the way, since it’s become irrelevant, we may as well privatize it so it can act like a real business and get rid of workers and post offices. 

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On Privatization

Good Reading on Postal Privatization

Also: Sarah Ryan's "Understanding Postal Privatization: Corporations, Unions, and the "Public Interest"


 

Privatization in the UK

save your p.o.

Organizing to Save Rural Post Offices


A Community Organizing Toolkit

Revised November 2012

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