Postmaster General Louis DeJoy has announced a delay in implementing certain changes to USPS facilities until 2025. This decision comes in response to a request from a bipartisan group of senators, urging a slower implementation of the agency’s network modernization plan. In a letter to Sen. Gary Peters (D-Mich.), DeJoy confirmed that USPS will pause its plans to move mail processing operations at numerous facilities.
Mail Processing Facility Reviews and Future Plans
Currently, 60 out of 427 USPS facilities are undergoing Mail Processing Facility Reviews to evaluate the potential relocation of their mail processing operations to larger regional hubs. DeJoy assured Senator Peters that these changes would be on hold until at least January 1, 2025. Any future actions will be communicated and implemented at a moderated pace.
Senator Peters Calls for More Information on Transportation Changes
Senator Peters expressed his appreciation for DeJoy’s decision but urged USPS to reverse recent transportation changes in Michigan until more information on their impact is available. He emphasized the need for a comprehensive study by the Postal Regulatory Commission to ensure any changes do not negatively affect mail delivery.
Bipartisan Senate Group Demands Halt to Network Modernization Plan
Last week, a group of 26 bipartisan senators, led by Peters, called on USPS to halt all changes under its network modernization plan until an independent regulator can assess its merits. At a USPS Board of Governors meeting, DeJoy acknowledged service failures in Atlanta, Houston, and Richmond, Virginia—locations of the new large mail processing hubs. He committed to working on restoring service in these areas and highlighted the importance of the modernization efforts for achieving reliable and cost-effective service.
Impact on USPS Facilities and Workforce
USPS has stated that the review process will not lead to facility closures or career employee layoffs. Instead, many affected facilities will be upgraded into Local Processing Centers. However, some facilities may experience a net loss of employees and management positions. USPS assured that it would work closely with management associations and follow collective bargaining agreements.
DeJoy Defends Modernization Plan Amid Congressional Pushback
In his letter, DeJoy mentioned that USPS had not yet implemented the proposed actions from the Mail Processing Facility Reviews and that future plans had not commenced. He emphasized that there would be no layoffs of career employees, facilities would remain open, new equipment would be installed, and working conditions would improve.
Earlier attempts by lawmakers to block these USPS changes through fiscal 2024 spending deal language or standalone bills were unsuccessful. DeJoy has defended his plan, differentiating it from previous USPS consolidation efforts and focusing on opening new, efficient facilities.
USPS Financial Performance and Criticism
USPS reported a net loss of $1.5 billion in the second quarter of fiscal 2024, though this was reduced to $300 million after excluding costs beyond its control. Despite a decline in First-Class mail volume, revenue increased by nearly $500 million due to significant price hikes. USPS has also reduced costs by $100 million, mainly through cutting transportation expenses and work hours.
The on-time delivery rate for First-Class mail has dropped to 84% this fiscal year, down from 91% in the first half of fiscal 2023, leading to widespread criticism. Ronald Stroman, a USPS board member, suggested halting the reform efforts to minimize service declines and allow more time for adjustments.
Future Outlook and Potential Congressional Intervention
Despite the criticism, DeJoy remains committed to his approach, stating that change is necessary for USPS to survive. He acknowledged the challenges but emphasized the need for patience, as his changes aim for long-term success.
A bipartisan group of senators recently demanded USPS pause and reverse its reform efforts until the Postal Regulatory Commission can evaluate their impacts. They criticized USPS for moving forward without public consultation and causing mail delays. The PRC is seeking increased scrutiny of USPS’s reforms and has asked the agency to either request an advisory opinion or justify why it does not require one.
DeJoy defended his expertise and criticized Congress and the PRC for lacking the experience to manage USPS’s financial challenges. He apologized for the deteriorated performance but insisted on the necessity of the changes. If improvements are not seen soon, Congress may intervene, with legislation already introduced to impose new restrictions on USPS’s changes.
Postmaster General Louis DeJoy’s decision to delay USPS facility changes until 2025 marks a significant shift in the agency’s modernization plan. While the delay addresses concerns from a bipartisan group of senators, the future of USPS’s reform efforts remains uncertain as scrutiny from regulators and lawmakers continues.
