September 15, 2013
BY MARK JAMISON
It may be September, but it feels like “Groundhog Day,” the movie in which newsman Bill Murray wakes up to the same day over and over again. A few weeks ago, rumors started swirling again that the Postal Service was going to request an exigent rate increase.
News reports said that at its meeting on September 5, the USPS Board of Governors would decide whether or not to file a request with the Postal Regulatory Commission. After the meeting, we learned the BOG had postponed making a decision, and the question of a rate increase was back up in the air.
It’s the same old story. We went through this same mood swing in 2010 when the Postal Service took a break from finding things to cut and ways to diminish service and instead submitted a request for a rate increase to the PRC. It was badly mishandled. The Postal Service provided a mishmash of an argument claiming that it was the Internet, no, the Great Recession, well maybe both after all, that was behind the precipitous drops in mail volume that began in 2008.
The PRC spent months analyzing the Postal Service’s request and found that an exigent increase was not justified by “electronic diversion” because it was a “long-term structural problem,” not an “extraordinary” circumstance. The Internet has been around for a long time, and its impacts on mail volumes should be fairly predictable.
The PRC did find, however, that the Great Recession — the worst economic decline in seventy years — may have been the likely cause for the loss of billions of pieces in mail volume. The Commission encouraged the Postal Service to come back with a more specific analysis that measured just what portion of the losses were “due to” the economic decline itself.
The Postal Service sued in Federal Court. The court remanded the case back to the PRC. The Postal Service dallied with reopening the docket and then let it fall by the wayside while it pursued further cuts to its infrastructure and legislative remedies. For a while, it seemed as if the mailers had succeeded in convincing the Postmaster General that a rate increase should not be part of the solution to the Postal Service’s problems.
The mailers were thus quite naturally dismayed to learn a few weeks ago that the exigent rate increase was back on the table. Their lobbyists immediately began howling disconsolately over the possibility that rates might go up, and their press machinery began cranking out op-eds and letters-to-the-editor claiming that civilization as we know it would come to an end if a rate increase were imposed.
“Put those crazy ideas about rates aside and get back to the business of cutting wages and infrastructure,” they told anyone who would listen. These mailers have spent the past two years (more really) encouraging the Postal Service to downsize in order to keep costs down and thereby avoid a rate increase. All the “rightsizing” has meant declines in service, and they certainly didn’t want to suffer lower standards and a rate increase too.
So here we are again. Just as it did before, the Postal Service has announced it might seek an exigent rate increase, and once again, it has decided to postpone the request. Who knows where things will be when we wake up tomorrow?
September 12, 2013
BY MARK JAMISON
Off the Georgia coast just above the Florida border lies Jekyll Island, a popular tourist destination that boasts a beautiful beach, a historic district, and the Georgia Sea Turtle Center. A couple of hundred miles up the road is Augusta, Georgia, where the Godfather of Soul, James Brown, grew up.
The Postal Service has a new strategy for providing postal services to Jekyll Island that might best be described as a version of Brown’s early hit “Papa's Got a Brand New Bag.” The Postal Service "ain't too hip now" but it's got a new bag, too. It wants to end door delivery for the nearly nine hundred homes and businesses on Jekyll Island and instead have everyone go to the post office to pick up the mail. According to postal regulations, the Postal Service can't change a customer's mode of delivery without permission, but that's not how it's going down on Jekyll Island.
The island is owned by the state of Georgia, and it is administered by a state board called the Jekyll Island Authority (JIA). The residents of the island own their homes, but they lease the land on which their houses sit.
The island is served by a small branch of the main office in Brunswick, on the mainland, over twelve miles away and on the other side of a six-mile causeway. The office is currently open just four hours a day (9 a.m. to 1 p.m.). For many years the Jekyll Island post office was housed in a retail mall, but when that mall was torn down, retail services were moved to a trailer. The rent on the original facility was $10,500 per year, but the JAI didn’t charge the Postal Service any rent at all on the trailer.
The homes and businesses on Jekyll Island receive mail delivery from two city routes that originate in Brunswick. Mail is addressed to individual street addresses and bears a Jekyll Island zip code – 31527. Currently the carriers deliver to the door – a mode of delivery that has been around for as long as anyone on the island can remember.
The JIA has been constructing a new retail shopping center in the historic district at the south end of the island. It is a small area serviced by a few small roads, and according to residents, it's mainly frequented by tourists. After the new shopping center is completed, the temporary trailers that have been used since the old mall was taken down are going to be removed. The JIA has offered the Postal Service a place for a new post office in the new mall.
According to this article in the Florida Times-Union and other documents, at some point in the discussions between the USPS and the JIA, the scope of the negotiations expanded beyond the topic of the new post office. It appears that the Postal Service suggested — or at least implied — that it would close the Jekyll Island post office unless the residents agreed to give up home delivery. The Postal Service isn’t talking, and the attorney for JIA, Chris O’Donnell, has offered varying accounts, but that seems to be what happened.
According to Mr. O’Donnell, the JIA — fearing that the community might lose its post office — reached an agreement with the Postal Service to give up home delivery in exchange for a new post office in the tourist-oriented historic district. The Postal Service will pay a nominal $2,700 per year in rent.
The new facility is supposed to be sort of old-timey to fit in with the character of the historic district. It will have fancy brass boxes, a special postmark, and other “vintage” design features.
It isn’t clear who is going to pay for all of this. Mr. O’Donnell says he has the deal in writing, but he hasn’t offered it for inspection, and the JIA has not responded to my FOIA requesting documents related to the negotiations. Originally Mr. O’Donnell indicated that the deal included keeping delivery to the island’s businesses, but he has since backed off that assertion.
In several of his statements to the press, in the FAQ page describing the deal, and in an email responding to a resident’s questions, Mr. O’Donnell has sometimes sounded like he was reading a set of Postal Service talking points. He refers to legislation in Congress that would eliminate home delivery, but it’s not clear which legislation he’s referring to, and there's a big difference between proposed legislation that may never be enacted and the current statutes and regulations.
The Postal Service certainly hasn’t been shy about pressing for changes in modes of delivery across the country. In most cases, it would prefer cluster boxes to door or curb delivery because centralized delivery costs less. But according to current postal regulations, the Postal Service can’t change a customer’s mode of delivery without the customer’s permission.
September 11, 2013
Going Postal: U.S. Senator Dianne Feinstein’s husband sells post offices to his friends, cheap, by Peter Byrne. Kindle Edition available on Amazon.com (accessible on any Mac or tablet).
The husband of U.S. Senator Dianne Feinstein of California has been selling post offices at bargain basement prices — often to his own business partners. That’s the conclusion reached by award-winning journalist Peter Byrne after a year-long investigation. His report is entitled Going Postal U.S. Senator Dianne Feinstein’s husband sells post offices to his friends, cheap.
Senator Feinstein’s husband is Richard C. Blum, the chairman of CBRE Group Inc., the largest commercial real estate firm in the world. In 2011, the Postal Service awarded Blum's company an exclusive contract to sell off postal real estate in cities and towns across America.
Byrne's in-depth investigation details the many apparent conflicts of interest driving the CBRE deals. It brings to light a scathing government audit of Blum's contract that is being ignored by the Obama administration. It’s based on information gathered through numerous requests filed under the Freedom of Information Act (FOIA) and extensive analysis of invoices, tax records, and government reports, as well as many interviews.
The investigation reveals how Senator Feinstein pressured the Postmaster General to stop a postal construction project, and to favor the interests of a developer working with her husband's firm. We learn that the post office executives in charge of Blum's contract have been up to financial shenanigans of their own.
Byrne’s investigation has uncovered evidence of multiple conflicts of interest and problems with post office sales supervised by Blum's company. Among its findings are the following:
- CBRE appears to have repeatedly violated its contract to sell postal properties at or above fair market values.
- CBRE has sold valuable postal properties to developers at prices that appear to have been steeply discounted from fair market values, resulting in the loss of tens of millions of dollars in public revenue.
- In a series of apparently non-arm's-length transactions, CBRE negotiated the sale of postal properties all around the country to its own clients and business partners, including to one of its corporate owners, Goldman Sachs Group.
- CBRE has been paid commissions as high as 6 percent by the Postal Service for representing both the seller and the buyer in many of the negotiations, thereby raising serious questions as to whether CBRE was doing its best to obtain the highest price possible for the Postal Service.
- Senator Feinstein has, herself, lobbied the Postmaster General on behalf of a redevelopment project in which her husband’s company was involved.
September 11, 2013
BY JACQUELYN MCCORMICK
Fighting the Postal Service is always a David versus Goliath challenge, but citizens can’t stand by and watch their post offices being closed without putting up a fight. The National Post Office Collaborate was created in the spring of 2013 in response to the proposed sale of the historic Berkeley Main Post Office. The Collaborate quickly realized that since historic post offices were being sold off all across the country, the fight needed to take on a national perspective.
In addition to the Berkeley post office, the Collaborate has focused its energies on stopping the sale of the Bronx General Post Office and the post office in La Jolla, California. These three buildings are on the National Historic Register of Historic Places, and they all contain priceless New Deal artwork. There are many other historic post offices that are earmarked for sale, and the Collaborate has been reaching out to local citizens and activists opposing the sales as part of its effort to build a national coalition.
One of the main directions the fight has taken involves challenging the Postal Service for its failure to follow all the laws and regulations that govern post office closures, historic buildings, and federal properties. The Collaborate argues that the Postal Service has not followed the procedures mandated by the National Environmental Protection Act (NEPA), National Historic Perseveration Act (NHPA), and various presidential orders.
Most troubling, the Postal Service has not taken sufficient measures to guarantee public access to the art work in most of these historic post offices. This art is publicly owned and it is intrinsic to the buildings. It was paid for with taxpayer dollars, it and should fall within the domain of the Public Trust. It should not be transferred or removed from its environment and should always be accessible to the public as originally intended.