Latest Postal Service budget cutting plan tied to proposed shut downs of Iowa facilities

News

December 7th, 2011 by Ric Hanson

A U.S. Postal Service proposal filed this week to end next-day delivery of First Class mail is tied to plans to close hundreds of mail processing facilities around the country including four in Iowa. Postal Service spokesman Richard Watkins says there’s been a dramatic drop in mail volume in recent years – especially First Class mail. The shift has contributed to the Postal Service’s five-point-one billion-dollars ($5.1 billion) in debt this year alone.

“As you begin to dispatch less than full pallets and ship less than full truck loads, that’s when it gets really expensive,” Watkins said. The Postal Regulatory Commission likely won’t issue an opinion on the proposed changes for several months. The processing centers being considered for closure in Iowa are located in Cedar Rapids, Waterloo, Carroll and Creston. Facilities in Fort Dodge and Sioux City have already closed. And the Postal Service earlier announced plans to close up to 175 Post Offices in the state. Watkins notes First Class mail volume has dropped 27-percent in just three years.

“In 2005, for example, only five-percent of people paid their bills online. Now, that figure is 60-percent. So, there’s been a huge shift in the way our customers nationwide are using the mail,” Watkins said. The Postal Service is also turning to Congress in hopes of changing policies that would save the agency billions of dollars. One would eliminate a requirement to pre-fund future retiree health benefits. Another change, which Watkins says many customers support, would eliminate mail delivery on Saturdays. 

 He notes independent opinion surveys of both residential and commercial mailers have found nearly 70-percent would accept a five-day delivery week as a way to keep postal rates down. Watkins said, since 2006, the U.S. Postal Service has cut jobs and consolidated services to save about 12-billion dollars ($12 billion) — but much more still need to be done.

(Pat Curtis/Radio Iowa)