A postal reprieve

A postal reprieve

May 21st, 2012 in Opinion Times

The U.S. Postal Service processing and distribution center on Shallowford Road, initially on the agency's short list for closure, will continue to operate a bit longer -- probably until spring 2014. That's a positive development for workers at the facility and for area postal patrons, whose delivery times would have been negatively impacted by the closure. The news is not so good for workers and residents in many other places. The USPS said that 140 centers around the nation will be closed by February 2013.

The Chattanooga facility is among 89 facilities to be closed in 2014. The closing and consolidation of centers is part of a cost-cutting plan designed to save the agency about $1.2 billion annually. The cuts, painful as they might be, are necessary. The Postal Service is hemorrhaging dollars and money must be saved wherever possible. Even so, there's no guarantee the current plans will work in the long-term.

The Postal Service's losses are staggering. During the first two quarters of the current fiscal year, which ended March 31, the agency says it lost more than $6 billion. Clearly, it will take more than the savings engendered by closing the centers -- estimated at $1.2 billion a year when fully implemented -- to erase that deficit.

The service, by necessity, is pondering other ways to reduce costs. The possibilities include changes in employees' compensation and benefits and five-day-a-week deliveries instead of six. Those initiatives could save the agency about $22.5 billion by 2016. Even that might not be enough to save the USPS. Postal revenues likely will continue to drop as more and more people use the Internet to communicate and to pay bills.

What the USPS really needs if it is to have a fighting chance to survive in recognizable form is a change in rules that require it to prefund billions in future retiree health care benefits that it meet federal mandates even though it does not receive federal funds to underwrite operating costs. Those onerous requirements are unique to the Postal Service. They should be changed, but that's unlikely to occur, even though doing so would put the service on surer fiscal footing. Political partisanship, local self-interest and archaic rules have doomed every effort to make such alterations.

Given the service's cash flow problems and the mandates under which it operates, it is clear that the decision to keep the Shallowford Road center open is nothing more than a short-term reprieve. It gives workers there and residents here a bit more time to accept the inevitable closure and the deprivations that it will promote.

Many workers will lose their livelihoods. Residents will have to cope with longer delivery times -- perhaps two or three days for local service rather than the current one day. Large volume mailers -- Amazon, BlueCross BlueShield of Tennessee, EPB and Erlanger, for example -- who are heavily dependent on the timely pickup and delivery of mail will have to make adjustments. In many instances, that will be difficult to do.

Given projected decreases in mail usage and the likelihood of continued deficits, the Postal Service has little choice other than to cut costs by closing facilities and, perhaps, by reducing services. Even as it takes those steps, it should continue to pursue -- legislatively and otherwise -- a course of action that fairly balances the demand for fiscal prudence with public need and fair public service.