USPS Releases the Findings of Its Area Mail Processing Study

WASHINGTON, DC—Feb. 23, 2012—In a move to help ensure the future of the nation’s mail system, while adapting to America’s changing mailing trends, the U.S. Postal Service announced that the Area Mail Processing consolidation studies that began more than five months ago have been completed.

These changes are a necessary part of a larger comprehensive plan developed by the Postal Service to reduce operating costs by $20 billion by 2015 and return the organization to profitability.

Among the items noted on study fact sheet are:

  • Of the 264 processing facilities studied for possible consolidation, six are on hold for further internal study, 35 will remain open at this time and 223 have been found feasible for consolidation, all or in part.
  • The network consolidation would reduce operating costs by $2.6 billion annually and result in a net savings of $2.1 billion.
  • Due to regulatory and labor-agreement requirements, the Postal Service is beginning a lengthy notification process now in order to be in a position to begin implementing its national mail processing realignment during the summer and fall of 2012. These changes are contingent upon a final decision to change our service standards for First-Class Mail.
  • Further, in keeping with the terms of an agreement the Postal Service made with Congress in December, 2011, no consolidation of any postal facility will occur prior to May 15, 2012, to give Congress and the Administration the opportunity to enact an alternative plan.

The USPS has posted a listed detailing the status of the facilities studied (pdf) and background FAQ document (pdf) with more details.

The Postal Service is in the midst of a financial crisis due to the combined effects of the economic recession, increased use of electronic communications, and an obligation to prefund retiree health benefits. First-Class Mail volume has deteriorated, leading to significant revenue declines, and the obligation to prefund these retiree health benefits on an accelerated basis remains unresolved. To date, legislative proposals to address the financial crisis remain pending, leaving the Postal Service and the mailing industry it supports in an increasingly precarious position.