Relevant and even prescient commentary on news, politics and the economy.

The Postal Service wants to slow down the mail, Congress says not so fast

Steve Hutkins at Save The Post Office continues his dialogue on planned changes to USPS operations with one change amongst the others resulting in later deliveries of first class mail. The Washington Post was the first to report on this change as well as other changes. You may be able to catch portions of Louis DeJoy’s planned changes at other sources as well.

The Postal Service wants to slow down the mail, Congress says not so fast

Congressional Action:

The House Committee on Oversight and Reform has just posted a discussion draft of postal reform legislation in advance of Wednesday’s hearing with Postmaster General DeJoy and the Chairman of the Board of Governors, Ron Bloom. The draft has three main sections — one about creating a Postal Service health benefits program that includes Medicare, one on reforming the Retiree Health Benefit Fund obligation, and a third on service standards for on-time delivery.

The section on service standards comes first, and it is obviously a response to all the problems with poor service over the past seven months. It includes more stringent service performance reporting than currently shared with the Postal Regulatory Commission and the public, a tougher line on what happens when the Postal Service fails to meet the standards, and changes to the PRC’s advisory opinion process for reviewing a change in standards (including a report to Congress). The draft legislation concludes this section as follows:

“The United States Postal Service may not revise the service standards for market-dominant products in effect on the day before the date of enactment of this Act in a manner that lengthens delivery times before the date on which the report required by subsection (c) is submitted to Congress.”

The Committee’s meeting on Wednesday (24th) is clearly going to address the past problems with service performance and what to do about them moving forward. (There’s more about the delays here.) It’s also clear that the Committee is aware of the Postmaster General’s plans to change service standards, as was reported recently in a great scoop by the Washington Post, and the Committee wants to head the PMG off at the pass.

Back to the Future: The USPS, PRC, and Mailers revisit the meaning of PAEA

Steve Hutkins at Save the Post Office

Continued discussions between the mailers who are faced with higher rates, PMG Louis DeJoy, and Congress. The mailers are in court as we read Steve’s excellent review of what is taking place.

Also, PMG DeJoy has plans of increased prices for mailers also includes slower service and higher prices for First Class mail. The February 12th edition of the Washington Post exposed the PMG plans to increase prices for First Class Mail and slower deliveries of First Class Mail going from 2 days to 3 to five days. More information can be found at WaPo or truthout.

Back to the Future: The USPS, PRC and Mailers revisit the meaning of PAEA

Earlier this week a group of mailers’ associations continued their effort to convince the DC Circuit Court to stop the Postal Service from increasing rates under the new authority it was recently granted by the Postal Regulatory Commission.

The Postmaster General has told the mailers that another rate increase, based on the new authority, is “imminent.” The exact size of the increase has not yet been revealed, but the Postal Service’s calculations indicate it could be as large as 5.56 percent. Market Dominant revenues in 2020 were about $42 billion, so a full increase could mean $2.3 billion in additional costs for mailers.

In December, the Mailers filed appeals on the PRC’s order approving the new system in the DC Circuit. On January 27, 2021, they proceeded to file a request for a stay seeking to prevent the order from being implemented while the court heard the appeal. On February 8, the Commission filed its brief opposing the request for a stay, and the Postal Service filed its own opposition as well. On Tuesday of this week (February 16), the Mailers filed their reply. (For more background about the case, see this previous post and this one too.)

The Explanation for the 2020 Mail Delay? Louis DeJoy

Steve Hutkins at Save The Post Office, The 2020 Mail Delays: Stats & Charts

Preface

The inventor of MRPII, Oliver Wight, coined a term for management deliberately obstructing the implementation of MRPII calling them “Cement Heads.” In Louis DeJoy’s case, rather than work with today’s postal system; DeJoy is deliberately sabotaging it with his changes. The end result will lead to its demise and subsequent takeover by private enterprise.

Having been on the manufacturing side for decades, I found understanding a present process is necessary in order to implement changes to improve operations. DeJoy has no intention of understanding anything and he uses change to promote the destruction of the USPS. He is trump’s paid assassin.

The following charts, graphs, and commentary by Steve Hutkins defines problems in USPS functionality as measured by data. The data points in a direction needing to be further analyzed to determine whether the direction chosen by DeJoy is leading to the destruction of the USPS. I believe it does.


Annual Compliance Review – Steve Hutkins

The Postal Regulatory Commission’s annual compliance review ordinarily focuses on postal rates, but this year, due to widespread reports of mail delays over the past several months, the Commission has been scrutinizing on-time service performance. Over the past few weeks, the Commission and its newly appointed Chairman have filed a number of information requests seeking data from the Postal Service about the scope and causes of delays.

According to the service performance data provided by the Postal Service, the delays began at a modest level in March 2020 when the pandemic started, deepened noticeably in July when the Postal Service implemented cost-cutting operational changes, improved modestly in the fall, and then got much worse in December with the holiday mail crush.

As for the causes of the delays, the Postal Service has blamed COVID — the surge in packages, employee availability problems, more dependence on surface transportation because of a lack of available space on aircraft, and so on. It has also cited bad weather, the need to prioritize election mail and other factors. The Postmaster General has acknowledged that operational changes made in July caused delays, but the Postal Service says the system adjusted to these changes in a matter of weeks and they were not a factor in the delays that followed.

How the Pandemic could lead to a big USPS price hike

Angry Bear has been featuring the words of Steve Hutkins and Mark Jamison for a good bit of time now. They are the go-to people outside of the USPS on issues associated with it and the Congress which impacts it. We exchange emails and stories from time to time.

Save the Post Office is edited and administered by Steve Hutkins, a retired English professor who taught place studies and travel literature at the Gallatin School of New York University.


Expected Rate Increases Beyond CPI

On November 30, 2020, the Postal Regulatory Commission issued a 484-page order revising the rate system for Market Dominant products. Under the new system, the Postal Service will be able to raise rates beyond the Consumer Price Index, which it was prevented from doing (aside from the provision for an exigent increase) by the Postal Accountability and Enhancement Act of 2006. (See this previous post for more about the order.)

Last week, the Postal Service gave the PRC its calculations for the two new authorities crafted by the Commission. The Notice of Calculations of Future Rate Authorities indicates that the density-based rate authority will be 4.5 percent, and the retirement-based rate authority will be 1.06 percent, for a total of 5.56 percent.

Those potential increases are on top of the approximately 1.8 percent increase for First-Class Mail and 1.5 percent increase for other categories the Postal Service has already proposed for 2021. If the Postal Service were to exercise its full rate authority, the total increase would thus be over 7 percent. The new system also gives the Postal Service authority for an additional 2 percent increase for products that don’t cover their attributable costs.

PRC busts the price cap, lawsuits sure to follow

Fact: Contrary to what President Trump claims, the Postal Service can’t solve its financial problems by raising “the price of a package by approximately four times.”

Steve Hutkins at Save The Post Office discusses the financial issues facing the United States Postal Service and why the Postal Regulatory Commission  new plans to increase prices may be problematic. By no means is this a new topic. It has been brought up repeatedly by members of Congress and this administration as well as earlier administrations. The USPS was not meant to be profitable and its present situation is the result of the Postal Accountability and Enhancement Act.

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The Postal Regulatory Commission has spent the past four years working on a revision of the rate system for Market Dominant products. Yesterday the Commission issued its final rule on the changes. The order is here. The PRC’s press release is here. The media kit contains a useful FAQ.

The process of reviewing the rate system involved the Commission, the Postal Service, and an extensive list of stakeholders and commenters.  And even though it’s been going on since December 2016, it’s not over yet, not by a long shot. Given that many of the mailers have fought the changes that were finally approved, it’s widely expected that some stakeholders will appeal the PRC’s order to the D.C. Circuit.

Processing Center Percentages are “Not” On Time Delivery Percentages

Steve Hutkins of Save the Post Office has been live blogging and providing updates to the 12 federal district court cases filed. In the November 6, 2020 Update Steve discusses the delivery updates being filed in court and which are being used by some news outlets to show the USPS has been delivering ballots late and not on Election Day. Steve cautions against the use of this data as actual delivery dates are different than processing dates.

November 6, 2020 Update

The Postal Service’s daily reports on service performance, election mail, and late/extra trips (submitted as part of the Joint Order from the courts in RichardsonVote Forward, and NAACP) can be found here.

Steve Hutkins: One note about these daily reports on election mail. Some news reports are looking at these reports and misinterpreting the data and saying things like this:

“The data based on scans of ballot envelopes that were filed in Sullivan’s court Wednesday suggested that in South Florida, just 85.12% of the mail-in-ballots were delivered on Election Day and in central Pennsylvania, just 61.3% of the mail-ballots in the postal system were delivered on time both of which were based on the scan data in the court filing shown. In Philadelphia, slightly more than 66% of the mail-in ballots had been delivered on Election Day. In Atlanta 82.2% percent of the mail-in ballots were delivered on Election Day, the court filing shows.”

The daily numbers being reported do not indicate how much of the mail was delivered on time, i.e., within the service standard of two or three days. These numbers are  processing  scores, i.e., the percent of the ballots that went through the processing network on time. They do not encompass;

the “first mile” (the step between a voter dropping a ballot in the mail and its arrival at a processing center) or the “last mile” (from post office to letter carrier to destination).

USPS Court Case Updates – Election Ballot Delays

Steve Hutkins on-line live blogging at Save the Post Office has been updating the progress of the “Lawsuits against DeJoy, USPS & Trump with relation to mail delays and election mail. This is the sweep ordered by the court for the USPS to perform to discover and report via the  “sweep of facilities”  how many ballots (were) are being delayed due to the USPS. The twitter link in the Afternoon Update has numerous comments on the delay by the USPS delaying the Sweep. In the Morning Update (below) there are multiple various commentary by news outlets.

More to come.

November 5, 2020

Afternoon Update: Judge Sullivan presided over another hearing today. One of the questions on the table was how many ballots may have been delivered late or are still in the system and not delivered yet. The Postal Service shared some specific numbers, as reported in a great “live” twitter thread on the hearing by @USPostOffice911.

Looking a ballots without a destination scan, the Postal Service says that in the Central PA district, there are 1524 total, and of these USPS has confidence that 979 were expedited, while 545 require further investigation.  In Greensboro, 3087 total, 1752 expedited, 1335 to investigate. In the Carolina district, 2404 total without destination scans, 1204 confidence they were expedited, 1200 to investigate. In Philadelphia, 2496 total, 1682 expedited, 814 to investigate. The Postal Service said that there is no evidence yet that the ballots in the “investigated” category were not delivered.

In a separate filing, the Postal Service provided a list of the number of ballots that were delivered Express in each district over the three days Nov. 1- Nov. 3. The total appears to be about 10,655.

The plaintiffs have presented two proposed orders, which Judge Sullivan appears to have ordered.

Voting by Mail and the Next Election Meltdown – A Prophecy

Steve Hutkins at Save The Post Office, October 31, 2020

This post was written in 2016 and slightly updated on Oct. 31, 2018, exactly two years ago today. The update started like this:

According to this AP report today, alarms are already being raised about the rejection of many mail-in ballots in next week’s elections. Several of these elections are likely to be very close, and in some cases, votes cast by mail may make the difference. As the AP article notes, “nearly one of every four ballots cast in 2016 came through the mail or was handed in at a drop-off location, according to the U.S. Election Assistance Commission.” With more and more people choosing to vote by mail, controversies involving mail ballots are likely. Back in 2016, just before the November election, we ran this article about the potential for an election “meltdown” arising from voting-by-mail issues.

Following is the 2018 update, with no further revisions for 2020. Some of the details are out-of-date and incorrect, but much of the post is more relevant now than it was then.

DeJoy’s 57 Varieties of Cost Cutting: What’s in the new OIG report—and what’s not?

Steve Hutkins at Save The Post Office, October 26, 2020

In response to several inquiries from members of Congress, the Office of Inspector General has issued a report on “Operational Changes to Mail Delivery.” The report discusses the Postal Service’s plan to eliminate 64 million work hours — the equivalent of 33,000 jobs — by implementing 57 cost-cutting initiatives. As discussed in this previous post, the plan represents one of the largest downsizing efforts in the 50-year history of the Postal Service.

These 57 “Do It Now FY Strategies” include restrictions on overtime, late and extra trips from processing centers, and all the other cost-cutting measures that have caused the delivery delays we’ve seen since July. They also include numerous other changes to postal operations that have not received much, if any, attention.

The report criticizes postal leadership on several counts. First, the Postal Service “did not complete a study or analysis of the impact the changes would make on mail service prior to implementation.” Second, “documentation and guidance to the field for these strategies was very limited and almost exclusively oral.” That caused “confusion and inconsistency” and “compounded the significant negative service impacts across the country.”

The IG also criticizes management for a third major failing: The Postal Service did not “fully respond” to questions and document requests from Congress and did not share information about the plan beyond what the Postmaster General was specifically asked in his testimony before the House and Senate.

As a result, Congress was not informed of the existence of the Work Hour Reduction Plan and the “Do It Now FY Strategies” before or during the Postmaster General’s testimony to Congress. The plan is not mentioned at all in Senator Gary Peters “Failure to Deliver” report or his update report. It’s very likely that Congress has yet to receive a full accounting of the plan.

A New Agenda for Postal Reform

Steve Hutkins of Save The Post Office critiques the cost-saving measures put into play to-date by PMG Louis DeJoy, the bypassing of the Postal Regulatory Commission which is supposed to review such plans, and the resulting unprecedented mail delays across the country. Steve proposes a plan to meet the Covid crisis impact on the Postal service head-on and also lays a foundation for future Postal Service incorporating new business and creating increased revenue.

In late June of this year, a few days after the new Postmaster General took office and in the middle of a pandemic, the Postal Service initiated a plan to eliminate 64 million work hours, the equivalent of 33,000 jobs. It was one of the largest cost-cutting plans (perhaps the largest) in the history of the Postal Service, and leadership wanted to get it done by the end of the fiscal year on September 30 — and without telling anyone about it, including the Postal Regulatory Commission, which is supposed to review all such plans.  Within weeks, unprecedented mail delays were occurring across the country, members of Congress were hearing about post offices closing early, and — given that half the country may vote by mail — even the integrity of the election was threatened.

The response was swift. People protested in the streets, Congress held hearings and issued a damning report, and a dozen lawsuits were filed, leading to injunction after injunction banning the operational changes. The leaders of the Postal Service were forced to step back. But those in charge are still in charge, and the Work Hour Reduction plan is just on pause, waiting until after the election.

In the meantime, there’s a crisis at the Postal Service. As of mid-September, almost 10,000 postal workers had tested positive for Covid-19, and over 52,000 had taken time off because they were sick or had to quarantine or care for family members. Those numbers are obviously much higher now, and they will get worse over the winter. Overtime hours, rather than being reduced, have gone way up, from about 11 percent of total workhours before the pandemic to 17 percent during the week of October 2 and 21 percent during the week of October 9.

The surge in packages caused by the pandemic is taxing the capacities of the system, resulting in continued delivery delays. First Class mail, which normally has an on-time delivery target of 96 percent and an average score of 92 percent, has been averaging about 85.6 percent since early July. When the quarterly results are posted next month, the fourth quarter of 2020 (July-Sept) may be the worst since the Postal Service first started reporting service performance data back in 2009.

The problems at the Postal Service, coupled with the President’s comments attacking the post office, have made many people afraid to cast their ballots by mail, even though it may be the only safe way for them to vote. Just a few days ago, the states suing the Postal Service in Pennsylvania v DeJoy decided the situation was so bad that they’ve asked the court to appoint former Inspector General and BOG member David C. Williams to serve as a special monitor to oversee operations until the election.

Hopefully in January a new administration will take office in Washington. How will it deal with this crisis, and how might it envision the future of the Postal Service?