The U.S. Postal Service uses Area Mail Processing (AMP) guidelines to consolidate mail processing functions and increase productivity through more efficient use of equipment, facilities, staffing, and transportation. These consolidations are intended to reduce costs and maintain quality service.

The Postal Service finished consolidating the Panama City, FL, Processing and Distribution Facility (P&DF) into the Pensacola, FL, Processing and Distribution Center (P&DC) on April 1, 2013.

This report responds to a request from Congresswoman Gwen Graham to review the consolidation. Our objectives were to determine whether a business case existed to consolidate mail processing operations from the Panama City P&DF into the Pensacola P&DC and assess compliance with established AMP guidelines.

What the OIG Found

A business case existed to support consolidating the Panama City, FL, P&DF. We estimated the consolidation should save the Postal Service about $3.4 million annually, which is $55,782 more than the Postal Service estimated. We found the Postal Service overestimated mail processing craft workhour savings and underestimated transportation savings. Also, we found the Postal Service underestimated one-time costs by $55,088. 

We also found the Pensacola P&DC has adequate machine capacity to process the additional mail from the Panama City P&DF and the Postal Service did not lay off any career employees as a result of the consolidation. In addition, the consolidation did not substantially impact the community and the Postal Service generally complied with established AMP guidelines.

We also found that productivity decreased at the Pensacola P&DC. In addition, the consolidation resulted in improved service standards. However, service performance slightly declined after the consolidation.

What the OIG Recommended

We recommended the vice president, Southern Area, adjust staffing and workhours at the Pensacola P&DC to ensure productivity targets are achieved and adjust transportation and other operational requirements to ensure the Pensacola P&DC meets service commitments.

Read the Full Report


Comments (6)

  • anon

    Thank you for your comments on our 2016 Panama City, FL, Processing and Distribution Facility Consolidation Audit Report. Though our work on this specific audit report has ended and we have closed the comment section on this page, the Office of Inspector General is continuously conducting reviews of lost and delayed mail. Please visit our home page to view our most recent work. Also, we ask you to please visit the “Contact Us” page on this website for information on where to file formal complaints with our agency or the Postal Service. Thank you again, OIG Audit Team.

    Feb 21, 2018
  • anon

    I am not getting my mail on time and my post office blames to Pensacola Processing Center. Someone needs to get this fixed! They are messing with my medicine and other mail. GET IT FIXED !!!

    Feb 16, 2018
  • anon

    I had 9 packages come through this office and were supposed to get delivered to multiple states by December 18. Now it just says in transit delayed and no updates. What happened to my packages?

    Dec 20, 2017
  • anon

    In rgards to a lost package... no phone numbers are given... if a number is one answers.... typucal gov workers.....

    Oct 11, 2017
  • anon

    I was tracking my package and it came to Pensacola today, then it went to Panama City. Yikes, I live in Pensacola. Sounds backwards to me. This saved time and money? Please advise.

    Oct 20, 2016
  • anon

    I had an undelivered to Shelby Montanan I didn't know that I didn't put my return address on it it went to crossroads correctional facility it was addressed to the chaplain I don't know how to get it from you it was in a priority mail envelope it had my husband wedding band in it please help me out to get it back

    Jan 15, 2016