USPS Proposes Slower First Class Mail

To save about $2.1 billion, the agency proposed Dec. 5 to move first class mail to a 2-3 day standard for contiguous U.S. destinations.

The U.S. Postal Service proposed another step Dec. 5 to become profitable again, saying it can save about $1.2 billion by changing first class mail to a 2-3 day standard for contiguous U.S. destinations. The agency said this is needed because of the "dramatic and continual decline" in first class mail volume.

USPS is among the largest civilian employers in the U.S. government, with 574,000 career employees. Some of them undoubtedly would lose their jobs because the agency is studying 252 mail processing facilities for possible closure.

"The U.S. Postal Service must reduce its operating costs by $20 billion by 2015 in order to return to profitability," David Williams, vice president of Network Operations, said Dec. 5. "The proposed changes to service standards will allow for significant consolidation of the postal network in terms of facilities, processing equipment, vehicles and employee workforce and will generate projected net annual savings of approximately $2.1 billion."

USPS said this move is part of a network optimization initiative projected to save as much as $3 billion by 2015. "The size of the existing Postal Service network is dictated by the current overnight transit time in existing service standards. The Postal Service is proposing, through the rulemaking process, to move First-Class Mail to a 2-3 day standard for contiguous U.S. destinations; however, there would be an opportunity for mailers who properly prepare and enter mail at the destinating processing facility prior to the day's critical entry time to have their mail delivered the following delivery day," its news release said.

The agency said it will submit a request to the Postal Regulatory Commission for "an advisory opinion regarding service standard changes associated with a significant rationalization of its mail processing network" and soon thereafter will publish a notice in the Federal Register seeking public comments on the proposed changes. The agency's 2010 revenue was $67 billion, and it processed 171 billion pieces of mail that year.

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