U.S. Postal Service says it may shutter 3,700 post offices

U.S. Postal Service says it may shutter 3,700 post offices

July 27th, 2011 By Angela G. Keane/Bloomberg News in News

This North Chattanooga Post Office is one of four Chattanooga offices closed previously due to budget cuts.

Photo by John Rawlston/Times Free Press.

CLOSER TO HOME

Local post offices targeted for closure:

* Downtown Cleveland, 155 Broad St. NW, Cleveland, Tenn.

* South Chattanooga, 1101 W. 40th St., Chattanooga, Tenn.

* East Chattanooga, 2200 Amnicola Highway, Chattanooga, Tenn.

* Highland Park, 511 S. Hawthorne St., Chattanooga, Tenn.

* 12539 Highway 411 N., Cisco, Ga.

* 57 Tennga Gregory Road, Tennga, Ga.

WASHINGTON - The U.S. Postal Service, which may run out of money in September, said Tuesday it may close as many as 3,700, or 12 percent, of its post offices as customers buy more services online and through locations such as grocery stores.

Post offices in every state but Delaware may close, according to a list provided by the USPS. More than half are in rural locations, said Sue Brennan, a spokeswoman for the service. In communities without a post office, the USPS plans to sell stamps and offer services through local retailers.

The postal service, which reported a loss of $2.6 billion for the quarter ended March 31, is seeking to cut costs as it approaches its $15 billion borrowing limit. The closings may save $200 million a year by saving costs for labor and for operating the facilities, Postmaster General Patrick Donahoe said at a news conference in Washington.

"A lot of the decisions we make around our operations are based on the revenues that come into the operation," Donahoe said. The USPS has almost 32,000 post offices.

Eighty-four percent of the locations on the list for closing take in less than $27,500 in annual revenue and have less than two hours of work a day, said Dean Granholm, delivery and post-office operations vice president.

The post office network was built for a bygone era and customers today need retail locations that are convenient for where they live and work, Granholm said.

"We are wholly dependent on the sale of postage for revenue," he said. "Most businesses don't operate locations that operate at a loss."

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Bigger cities are also on the list. New York City may lose 34 stations under the proposal. Manhattan's 26 Federal Plaza office and the Port Authority are among its six potential closings, while 17 could close in the Bronx, and Brooklyn may lose five. Queens could lose five offices and Staten Island one under the plan.

In Washington, 19 stations may be shut, including one in the U.S. Capitol and four in House of Representatives office buildings.

The Agriculture, Labor, and State departments may lose offices as well. The post office at Walter Reed Army Medical Center, scheduled to close in September, is also listed.

The potential closings also include one in Vista, Calif., represented by Republican Darrell Issa, chairman of the House Oversight and Government Reform Committee, which oversees the USPS. He has criticized the postal service for the size of its workforce and facility network.

The postal service is seeking permission from Congress to delay a required payment for future retiree health care costs and to end Saturday mail delivery as it seeks to cut costs.

Donahoe said closings will be easier than previous attempts because of the plan to move services in areas with no nearby post offices to retailers.

Tuesday's list is the third grouping of postal retail facilities for possible closing since 2009.

In January, the postal service listed about 1,400 post offices and has shuttered 280 of them, Brennan said. From the 2009 list of about 3,600, 140 closed.

The USPS taking the right steps to stem losses, said Gene Del Polito, president of the Association for Postal Commerce. The Arlington, Va.-based group represents postal customers including L.L. Bean, Lockheed Martin and Time Warner.

"They have no other choice but to reduce redundant postal facilities," Del Polito said in an interview. "I think they're really serious this time. I get the sense that this is for real."