Trouble ahead: The PRC gives POStPlan a green light

August 27, 2012

Last Thursday, the Postal Regulatory Commission issued its advisory opinion on POStPlan, the Post Office Structure Plan, and the Postal Service isn't wasting any time implementing its plan to reduce hours at 13,000 post offices.  

On the same day the PRC published its findings, the USPS Postal Bulletin published changes to three operational manuals, laying out the details on POStPlan.   According to a letter from the President of the League of Postmasters, implementation of POStPlan could begin this week, and some post offices could see their hours cut by mid-November.  

POStPlan will obviously have a significant impact on postal services nationwide, and that’s why the PRC was required to weigh in with an opinion about the advisability of the plan and the issue of whether or not it conformed to Title 39.  The Commission has examined the plan and found it good — better, anyway, than closing thousands of post offices.

The postmasters associations signed off on POStPlan months ago, and it was largely unopposed during the advisory opinion process, so it came as no surprise that the Commission would approve the plan.  The only question on the table was to what extent and in what ways the Commission might find fault with the plan or offer recommendations for improving it.  The advisory opinion does express a few concerns — like the fact that the plan will reduce access to postal services for many customers — but for the most part the Commissioners had little to offer in the way of serious criticisms or major recommendations. 

The opinion begins by describing POStPlan as a “significant improvement” over the Retail Access Optimization Initiative (RAOI), last year’s plan to close thousands of post offices.  But that's not saying much.  There wasn't anything good about the RAOI, and POStPlan isn't much better.  Instead of closing 3,650 post offices, it reduces hours at 13,000 and gets rid of all of their postmasters.  The damage will be more widespread, and it will also come much sooner.

We’ll never know if the Postal Service could have overcome all the obstacles to closing thousands of post offices.  Perhaps new legislation would have prevented it.  As for POStPlan, it’s a done deal, as it has been for some time.  

We'll soon see how the implementation plays out and what citizens across the country have to say about it.  Will we see a reprise of the frustration, anger, and protest provoked by last year's effort to close post offices, or will people just be happy their post office isn't closing?


The chairman's concerns

Most of the significant concerns about POStPlan are articulated not in the advisory opinion per se but in Chairman Ruth Goldway’s Concurring Opinion at the end.  This is about the only section of the advisory opinion that expresses any real skepticism about the plan.  Among the Chairman’s concerns are the following:

  • The Postal Service will “encounter difficulties recruiting qualified employees for these positions in many communities,” so staffing should be a priority and not provide an occasion for emergency suspensions.
  • Post offices more than 25 miles from the nearest post office are designated Part-Time Post Offices (PTPO), but that distance seems arbitrary and it’s not substantiated by the record.
  • The role of the Village Post Office as a supplement rather than a replacement for post offices needs to be clarified.
  • Given news reports saying that post offices not on the POStPlan list are having their hours reduced, the Postal Service should be consistent in its screening policies and other procedures it’s using for reducing hours. 
  • Aside from reducing hours at 13,000 post offices, there’s the possibility that the Postal Service will either close or reduce the hours at hundreds of other post offices.

There’s not much else in the advisory opinion that casts doubt on the wisdom of the plan.  Overall, the Commission seems content that the Postal Service will be keeping post offices open and saving some money too, and there’s no reason to get overly critical. 


The commission's recommendations

As for recommendations, the advisory opinion makes several suggestions for improving the plan, but they don’t seem very significant.

The Commission, for example, suggests that the Postal Service should clarify the options available to communities.  The Postal Service has been identifying four paths: (1) reduce the hours at your post office, or close the post office and (2) use another post office, (3) switch to carrier delivery, or (4) get a Village Post Office. 

That’s basically just two choices — reduce the hours or close the post office — and the rest is just logistics about delivery possibilities.  (A cluster box isn’t mentioned, but that’s likely to be a common alternative as well.)

The Commission suggests that the survey should provide customers with a clear choice between (1) keeping their post office open with reduced hours or (2) closing their post office and providing replacement delivery service.  That’s a helpful but not very significant recommendation.  It just says that putting things in terms of two options would be clearer than four.

The Commission also recommends that building modifications enabling customers to access their post office boxes should be made before reducing the hours.  That’s common sense, and one would hope the Postal Service did not need to be told something like that.

The Commission has plenty to say about other relatively minor matters, like providing adequate notice to people about the pending change in hours, using the Internet to explain what’s going on, and so on.  The Postal Service will probably be happy to incorporate most of them.

There is one important recommendation in the advisory opinion, and that relates to the role of the Village Post Office.  While the Postal Service has been presenting the VPO as one of the four options available to communities, Jeffrey Day, the man in charge of POStPlan, told the PRC that the VPO should be seen as an “enhancement” rather than a “replacement” for a post office.  Instead of replacing a post office, the VPO would supplement services in communities where the post office had its hours reduced.  That’s clearly two different views of the VPO, and the Commission recommends that the Postal Service get its policy straight and not present the VPO as a replacement for a post office.

One other point of interest in the advisory opinion.  The PRC ran some numbers and produced a list of ten post offices it considered misclassified as Level 2 and 4 because the Postal Service had not correctly calculated the distance to the nearest post office.  The Commission suggested that these post offices be reclassified as Part Time Post Offices (PTPO), open six hours a day.  The list is here.

The advisory opinion runs to over sixty pages (the RAOI opinion was almost twice that long).  It provides a summary of how POStPlan will work, most of which repeats what the Postal Service presented in its Request for an Opinion and Mr. Day’s testimony, and it goes over some of the issues that came up through the discovery process and the cross-examination of Mr. Day.  Because there was not much opposition to the plan, the Commission did not have to work through numerous detailed legal briefs and complex technical issues, as it’s doing with the Network Rationalization plan.

Overall, the advisory opinion does not shed much light on POStPlan, and in many respects, it’s more interesting for what it doesn’t say than for what it does say. 

On behalf of infrastructure: Rethinking the postal environment

August 21, 2012


It's been four years since the Great Recession began to take its toll on postal revenues, and we appear no closer to a resolution to the crisis than when it first arose.  Of course, if one looks at it from an historical perspective, the Postal Service has faced an existential crisis since 1968, when the Kappel Commission issued its report on the future structure of the Post Office Department.

The Kappel Commission was made up of ten members, six of whom were Republican businessmen representing some of the largest corporations in the country.  A seventh member was George P. Baker, the conservative Dean of the Harvard Business School.  The remaining members were George Meany, President of the AFL-CIO; David Ginsburg, a liberal attorney who had been executive director of the Kerner Commission; and David Bell, vice-president of the Ford Foundation.  The commission took its name from the chairman, Fred Kappel, the retired Chairman of the Board of Directors of AT&T.

According to Murray Comarow, the executive director of the commission, the commissioners, while differing on many points, came together on the following fundamental principles:

  1. The Post Office is a business and should be run like a business.  It should have a board of nine directors, six appointed by the president and three appointed by the board.
  2. It should be a self-supporting government corporation.
  3. Appointments and promotions should be nonpolitical.
  4. The board should set rates after due process hearings, under statutory guidelines.
  5. Wages and benefits should be established by collective bargaining; the parties may agree to binding arbitration.  An impasse would be referred to the president.
  6. The board should establish industry-competitive levels of compensation for top management.

Given that this was a time when the corporation had become the most revered of institutions, it is not surprising that the commission came up with these basic principles for transforming the national post. 

The idea of running government as a business — and perhaps for the benefit of business — was not necessarily a new one.  But in an era of extraordinary confidence in the ability of corporate America to use business methods to find technocratic solutions, there was a certain intellectual fait accompli in the idea that the new Postal Service ought to look and act more like a corporate entity.  Shouldn't everything?


The Holy Grail of corporatization

The Postal Reorganization Act that Congress passed met many of the conditions and recommendations of the Kappel Commission, but according to Mr. Comarow, it failed to completely embrace the vision of the commission.  Instead of leaving rate issues to the Board of Governors, Congress created a separate oversight body known as the Postal Rate Commission.  Instead of making the decision to move to arbitration up to the President, Congress mandated that labor disputes be subjected to binding arbitration.

In a paper titled “The Federalist Papers and Postal Reform” [pdf] sponsored by the EMA Foundation — an industry organization created by the Envelope Manufacturers Association to promote postal and communications related industries — Mr. Comarow discusses the history of postal reform.  

Mr. Comarow contends that had Congress followed the suggestion of the Kappel Commission and created a self-governing and self-sustaining corporate entity, many of the ensuing battles surrounding the Postal Service would have been avoided.  In fact, Mr. Comarow commends what has become the Holy Grail of postal reform — the creation of a corporate being, responsible to its Board of Governors and responsive to its industry patrons. 

Listen to the PMG today and you will hear echoes of Mr. Comarow’s corporate vision.  Listen to representatives of the mailing industry, like the 21ST Century Coalition of Mailers, and you will hear strident advocacy for a postal entity that competes in the marketplace.  Of course, if you listen a bit more closely, you’ll hear something a little different, a bit more nuanced.  They want the Postal Service to be an entity that competes, but not too much.  In any case, they are not content with seeing the Postal Service provide a sanguine and helpful environment to help them profit.  They want something more.

Mr. Comarow’s work and the intellectual framework it created for a corporatized Postal Service has been embraced by many, particular those in postal-related industries.  While there is much to disagree with in both this paper and Mr. Comarow’s work in general, he does provide an accounting of some of the ancillary budget battles that affected postal legislation, particularly accounting for prior retirement obligations.  He also provides an interesting discussion about the Revenue Forgone Act of 1993 and the issues surrounding mandated rates for non-profits.

The greatest value in Mr. Comarow’s paper is that it sets a clear, undistorted vision of what the mailing community sees as the preferential structure of postal services in the United States. In doing so, it also clearly and obviously leaves out the general interests of the American people and dismisses the idea of the postal network as infrastructure.


Dateline Danville VA: The VP visits, the USPS cuts hours at the PO

August 16, 2012

On Tuesday of this week, Vice President Biden told a largely African American audience in Danville, Virginia, that Mitt Romney wanted to put them "back in chains" by "unchaining Wall Street."  Republicans jumped on the VP for playing the race card, Romney called the remark "reckless," and the story was all over the national news.  

There's another story coming out of Danville this week, but it won't make any headlines.  This Friday marks the last day the historic Courthouse post office on Main Street will be open full-time.  Starting next week, the post office will be open four hours a day.  And the Courthouse post office is not even part of POStPlan.  

It looks like reducing hours at post offices won’t be restricted to the 13,000 on the POStPlan list.  According to a brief item on the, as of August 18 the downtown Danville post office will be open Monday through Friday, 11 a.m. to 3 p.m.  Its current hours are 8:30 a.m. to 1:00 p.m. and 2:00 p.m. to 5:00 p.m.  That means it's going from 37.5 hours a week to twenty.

The news item says the Postal Service says the hours are being reduced “in an attempt to keep from closing down the branch.”  A letter displayed on the post office door says the reduction in hours is due to “recent economic changes within the postal service.”

There’s nothing very unusual about reducing hours at a post office.  According to a 2004 GAO report, the Postal Service has “adjusted hours at existing post offices from time to time to reflect customer demand.”  The Postal Service told the GAO that “postmasters are responsible for establishing window service hours based on the needs of the community within the funding resources.  Officials noted that they periodically assess the number of transactions and customer visits throughout the day to determine the appropriate hours, and that hours may be extended or shortened in response to customer demand.”

The Postal Service wouldn’t tell the GAO how many post offices had had their hours cut, but over the years, it has happened to a significant number of offices.  There are about 1,500 post offices on the POStPlan list that currently operate at part-time hours, and most if not all of them once operated full-time.  But unlike the post office in downtown Danville, nearly all of the 13,000 POStPlan offices are small rural post offices. 

Section 126.4 of the Postal Operations Manual (POM) reads as follows:

“Postmasters provide all retail services for 8 1/2 or more hours on nonholiday weekdays, unless otherwise authorized by the district manager, Customer Service and Sales.  Retail service hours are scheduled to meet the needs of local postal customers.  When the postmaster determines that additional service hours are necessary to meet community needs, employee work schedules are adjusted to provide such service.  Postmasters must obtain approval of the next higher management level for increasing workhour usage if additional costs are involved.”

“Main Post Offices and other postal units in business areas are usually open during the hours kept by that business community.  Stations and branches are not required to be open at the same scheduled hours as main offices.  Stations and branches can adjust retail service hours to meet the needs of the local community.”

The POM doesn’t say anything about reducing hours at a post office because of “funding resources” or to save money “in an attempt to keep from closing down the branch.”  The POM is more about expanding hours or adjusting them to fill the needs of the local community. 

[Correction: The passage quoted from the POM was from the 2002 version; the 2012 version is here, and it omits the reference to 8 1/2 hours.]

The Main Street post office is in the middle of downtown Danville, so according to the POM, its hours are supposed to be aligned with “the hours kept by that business community.”  As you might imagine, there aren’t many businesses or anything else in downtown Danville open 11 to 3.

The Courthouse post office is located in a building, owned by the Postal Service, that also houses the US District Court, open 8:30 to 4:30, and the US Marshal’s Office, open 8:30 to 5:00. 

There are dozens of other businesses, offices, stores, and government agencies within a few blocks of the post office.  To name just a few:

What can Brown do for you? Congressman Ryan's UPS Express

August 14, 2012

Congressman Paul Ryan, who may be our next Vice President, hasn’t had much to say about the U.S. Postal Service. 

He has a statement on his website about the agency’s financial problems, but it basically just nutshells the bills put forward by Darrell Issa and Stephen Lynch.  The only thing of substance in the statement is Ryan’s rejection of the claim that the Postal Service has overpaid $50 to $75 billion into the CSRS pension fund.

Ryan has come out in favor of selling government property, which would presumably include the sale of post offices, and he advocates including government entities like the Postal Service in the federal budget.  Ryan also sponsored a bill naming a post office for Congressman Les Aspin (1938-1995), who represented Ryan’s district in Wisconsin from 1971 to 1993. 


Getting by with a little help from UPS

That would seem to be about all there is to the story, but today the Huffington Post reveals another interesting Ryan-USPS connection.  It involves the lobbying career of Ryan’s wife, Janna (Little) Ryan, who worked as a tax attorney and lobbyist for Pricewaterhouse Coopers and Williams & Jensen from 1998 to 2000 — the period just before she married Ryan, in late 2000.

Among Janna’s clients were the Cigar Association of America (which didn’t want cigars regulated like cigarettes), Vermont Yankee (a nuclear power plant that wanted more favorable tax treatment), and several big pharma and insurance companies. 

One of Janna’s biggest clients was the United Parcel Service, which basically didn't want the Postal Service's competition.

According to, during the period that Janna lobbied for UPS (1998 – 2000), UPS spent over $5 million in lobbying efforts.  The Huffington Post article says that in 1998, Janna was part of a team that received $220,000 in fees for lobbying on behalf of UPS.

Not only was Janna lobbying for UPS, but in February 1999 (the HuffPost piece mistakenly says 2000), at just about the time Paul and Janna met, Congressman Ryan took a corporate-funded trip to Atlanta, where UPS is headquartered.  According to the Congressman’s financial disclosure report, the trip was paid for by UPS.

In addition to visiting UPS headquarters on UPS’ dime, Ryan has received significant campaign contributions from the shipper.  According to OpenSecrets, in 2000, UPS gave him $10,000, making it his fourth-largest contributor for the election cycle.  Over the course of his career, Ryan has received over $48,000 from UPS, which puts the company in his top 20 contributors (Koch Industries is sixth, with $63,000). 

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