Inadequate Consideration of Economies Possible Through Consolidating Operations and Reorganizing Service Areas: Post Office Department

Our review of the establishment, discontinuance, and consolidation of certain postal installations by the Post Office Department disclosed that the Department had failed to adequately consider economies possible in these cases through consolidation of postal operations and reorganization of postal service areas when planning new or expanded postal facilities and when postmaster vacancies occurred. Because of improved means of transportation, establishment and extension of delivery services, changes in mail processing concepts, and changes in the characteristics of the communities served, less costly means of operation can often be established by consolidating the operations of many of the independent post office. Our review disclosed that in certain Post Office Department proposals for acquiring additional facilities to meet expanding space requirements consideration was not given to the potential reductions in operating costs, including manpower and rental costs, of more than $1 million a year that could be achieved through consolidation of postal operations in the areas. Since our examinations encompassed only a few of the more than 44,600 postal installations, significant reductions appear to be possible in the overall annual operating costs of over $4 billion. In a letter dated May 21, 1964, the Postmaster General advised us that the Department's procedures for developing new facilities and modernizing existing facilities take into consideration the feasibility of reorganizing service areas and merging operations and indicated that the Department is consolidating mail handling activities through the establishment of numerous sectional centers across the nation.