Postal Regulatory Commission Rebuts USPS Five-day Delivery Proposal
WASHINGTON, DC—March 24, 2011—The Postal Regulatory Commission (PRC) issued its Advisory Opinion in Docket N2010-1 on a U.S. Postal Service plan to end Saturday mail delivery, collection and outbound mail processing.
The Postal Service is required to ask the PRC for an Advisory Opinion on any change in nationwide service it proposes. The Postal Service advised the PRC that due to falling mail volumes and revenues it is considering eliminating Saturday mail collection and delivery except for Express Mail and existing post office box service.
“Some of the commission’s analysis in today’s Advisory Opinion suggests that even lower estimates of savings and higher volume losses are possible. In all cases, we chose the cautious, conservative path. Our estimates, therefore, should be seen as the most likely, middle-ground analysis of what could happen under a five-day scenario,” said Chairman Ruth Y. Goldway.
Key findings of the PRC’s opinion include:
• The PRC’s annual net savings estimate is $1.7 billion.
– The Postal Service’s savings estimate is $3.1 billion.
• Full savings in either case would likely not be achieved until year three after implementation.
• The commission’s estimate of net revenue losses due to volume declines caused by the service cuts is $0.6 billion.
– The Postal Service estimate of net revenue losses is $0.2 billion.
• The planned changes would cause an average of 25 percent of First-Class and Priority mail to be delayed by two days.
• The Postal Service did not evaluate the impact of the proposal on customers who reside or conduct business in rural, remote, and non-contiguous areas.
• Customers in rural, remote, and non-contiguous areas can be particularly affected by the Postal Service’s plans. The commission received significant input from rural America and traveled to South Dakota and Wyoming to meet directly with rural customers and community leaders.