The US Post Office is looking to close 3,700 post offices nationwide. This sounds "bad" on the surface, but the "post office" actually has a pretty clever solution to keep these offices open. I hope it works out. I think it's a very clever idea.
Going through this story one finds a number of interesting data points. This might be the most interesting:
In California, one of the largest states in both geographical area and population, "more than 100" sites are on the list.The post office in Parshall has recently closed.
North Dakota, one of the smallest states in population, there are 76 sites on the list (if I counted correctly). There are 80 offices on the South Dakota list.
This is the number I would like to see: savings from closing these 3,700 post offices nationwide, and the savings generated by going to five-day delivery service. And not yet, but eventually three-day delivery service. (That wouldn't mean that postal delivery personnel would not have 40-hour work weeks; they would have multiple routes to get them to 40-hour weeks. [Update: closings would result in an annual savings of $200 million. The post office will lose $8,000 million this year. The closures represent a drop in the bucket.]
Like most companies, a huge expense is not the annual salary for all these employees, but the pensions and the health care premiums.
One of the post offices not on the list is the one in Belmont, Massachusetts, just down the street from where I am currently residing. This post office does not provide any outgoing mail: no mailboxes, no general delivery, no package pick-up, nothing. It is used only for outgoing mail. This function could easily be picked up by the UPS store just a few blocks away. This particular Belmont office has one or two employees serving the public; I do not know if there are additional employees in the back, or if there are services provided I am not aware of that necessitates that this office stay open.
I am surprised Amidon is among the list, given that it is the County Seat.
ReplyDeleteI assume in many rural states, a number of towns that lose their post office are the county seats, and perhaps the only "urban" area in their counties.
ReplyDeleteThe Post Office for my 55109 zip code is not on the list. The small customer parking lot is usually full. Sometimes I will got a few days when I have to sign for something or mail something to get a parking spot there.
ReplyDeleteI looked but could not find an OP-ED article I read a few weeks back. Basically it said that while the USPS was hurt by the post crash downturn the general decline in mail due to the internet was offset by internet buying.
The article said that in 2005 the USPS was given
10 years to pre-fund retirement and medical up to 2065. Here is one article I found. http://www.startribune.com/blogs/124356889.html
Two Money quotes: 1: "The U.S. Postal Service, which is losing billions of dollars annually, said today that it will suspend payments to the Federal Employee Retirement Service, a move that could save it $800 million a year. The USPS retirement account currently has a surplus of $6.9 billion"
#2: "Meanwhile, the post office is required to make payments of $5 billion a year to pre-fund future retiree medical costs. No federal agency has a similar obligation."
From a taxpayer standpoint this is one less retiree cost "time bomb" but it is somewhat like being five years into a 30 year mortgage and then being told that the total mortgage has to be paid off in ten years (this when the overtime and bonuses are down at work).
The cost to cover the entire US is the problem.
ReplyDeleteUPS won't deliver to remote rural areas. UPS will start the process, sending the package from NYC to San Antonio, but will then contract with USPS or an independent carrier to deliver that rare package to a remote ranch 100 miles away from nearest UPS route, but where USPS has a post office or a contractor takes up the slack. But UPS doesn't keep a post office open for that very sparse rural area.
And that's just the package. UPS doesn't have to get the letter mail out to that rural area daily; that's the post office.
The cost savings for the USPS will be in urban areas where internet, FedEx, UPS, local grocery stores can take up the slack of those little post offices that are nothing more than kiosks.
Likewise, 5-day delivery is a no-brainer. Special delivery (at extra cost) would still be delivered daily -- if they even have special delivery any more. I remember using special delivery years ago, getting mail on Sundays - but very expensive. I assume FedEx picked up that money-maker.