Reevaluating the Universal Service Obligation 

May 6, 2020 (RISC-WP-20-004) 

  • The need for a comprehensive review of the postal USO in this country has been discussed for over a decade.  

  • Defining a USO that provides clear guidance for a future Postal Service will be a challenging task, as it will need to balance customer needs while still ensuring financial stability of the Postal Service.  

The purpose of the Postal Service’s universal service obligation (USO) is to ensure that all postal users receive a minimum level of service at a reasonable price. However, many aspects of the Postal Services current USO are not clearly defined. A further defined USO would protect postal customers and provide guidance to the Postal Service about what changes it can implement in response to financial challenges. The OIG studied eight other posts that have made recent changes to their USO and identified some trends that provide insights into the future of the Postal Service’s USO.  

The OIG found that the two most common changes to the USO have been a reduction in speed of delivery (how fast a product is delivered) and frequency of delivery (how many days a week a product is delivered). However, there is no “one size fits all” solution, and USO changes have been customized for each country’s specific challengesFor this reason, a study of user needs is an important first step to modifying the USO. 

Comments (6)

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  • anon

    The USPS needs to have a standard for the hours of operation. My designated post office has the worst hours for window service available for any busy suburban post office in my area. I just received a letter from Postmaster Carol Carmichael stating that the Window Service hours are changing from Monday thru Friday 8:30 a.m.- 4:30 p.m. to 9:30 a.m.-4:30 p.m. ; with Saturday hours remaining 9:00 a.m. to 11:00 a.m.; the lobby remains open on a 24-hour basis. Ms. Carmichael's rationale for the change is to provide the most convenient and efficient level of service to her customers. However, people who work from 8:00 to 4:30 or 9:00 to 5:00 only have a 2-hour window to access Window Service on Saturdays. Is it any wonder the the USPS is losing money? Ms. Carmichael also refers the Powell customers to other available post offices which increases their work loads and customer lines. In my opinion, Ms. Carmichael's rationale does not align with the USPS Universal Service Obligation's mission, nor does it promote customer-friendly service - there is only so much "minimum level of service" for consumers without compromising the USPS mission and accessibility to all citizens.

    Jul 26, 2020
  • anon

    I expected more from the USPS OIG. I'm not sure why. I have never heard the word "minimum" used before. I have heard 'equal'. I'd say US Code is a pretty well defined USO. What you call a "reduction in speed of delivery", the rest of us call the criminal destruction of 1st class letter mail service standards. You know, the mail for which the postal service was created to deliver in the first place. In case there is any confusion about the following excerpt from US Code, try reading this explanation of it first: The Code of Laws of the United States of America is the official compilation and codification of the general and permanent federal statutes of the United States. U.S. Code Title 39 Section 101 (a) The United States Postal Service shall be operated as a basic and fundamental service provided to the people by the Government of the United States, authorized by the Constitution, created by Act of Congress, and supported by the people. The Postal Service shall have as its basic function the obligation to provide postal services to bind the Nation together through the personal, educational, literary, and business correspondence of the people. It shall provide prompt, reliable, and efficient services to patrons in all areas and shall render postal services to all communities. The costs of establishing and maintaining the Postal Service shall not be apportioned to impair the overall value of such service to the people. (b) The Postal Service shall provide a maximum degree of effective and regular postal services to rural areas, communities, and small towns where post offices are not self-sustaining. No small post office shall be closed solely for operating at a deficit, it being the specific intent of the Congress that effective postal services be insured to residents of both urban and rural communities. (c) As an employer, the Postal Service shall achieve and maintain compensation for its officers and employees comparable to the rates and types of compensation paid in the private sector of the economy of the United States. It shall place particular emphasis upon opportunities for career advancements of all officers and employees and the achievement of worthwhile and satisfying careers in the service of the United States. (d) Postal rates shall be established to apportion the costs of all postal operations to all users of the mail on a fair and equitable basis. (e) In determining all policies for postal services, the Postal Service shall give the highest consideration to the requirement for the most expeditious collection, transportation, and delivery of important letter mail. (f) In selecting modes of transportation, the Postal Service shall give highest consideration to the prompt and economical delivery of all mail. Modern methods of transporting mail by containerization and programs designed to achieve overnight transportation to the destination of important letter mail to all parts of the Nation shall be a primary goal of postal operations. (g) In planning and building new postal facilities, the Postal Service shall emphasize the need for facilities and equipment designed to create desirable working conditions for its officers and employees, a maximum degree of convenience for efficient postal services, proper access to existing and future air and surface transportation facilities, and control of costs to the Postal Service. I'd say that was all pretty clear cut. So, excluding the consideration of cost savings in the construction of new facilities, everything done to 'save' the United States Postal Service from a wholly manufactured fiscal 'crisis' over the last 9 years has been a criminal act, to include: Permanently shuttering over two thirds of its processing facilities. Closing or limiting hours at thousands of branch offices. Permanent elimination of hundreds of thousands of career craft jobs. So, please continue to pretend that US Code doesn't exist. It will become a moot point eventually as the end result will preclude the existence of the postal service altogether. The best the last administration could do was to consider reduced delivery days. Illegal according to US Code. This administration just wants to privatize the "postal system", to use their euphemism. They want direct access to almost $400 billion the postal service has squirrelled away towards employee retirement systems and retiree healthcare they've been forced to fund through 2081, as if there'll be a postal service in existence by then. So, by all means, please continue to have these discussions on whether or not to slowly or quickly destroy "a basic and fundamental service provided to the people by the Government of the United States". Please continue to ignore that over 20% of their workforce are veterans. More then ANY other company. Continue to ignore that almost a quarter of this nation still lacks affordable/reliable internet service and are dependent on the postal service for medications and other essentials. Continue to ignore that the postal service remains, by far, the top rated federal organization. Year, after year, after year... You get the picture. Or do you? This isn't hard, people. Eliminate prefunding mandated by PAEA in 2006. Coincidentally, the year postal service funding went into the red. The rest of your tax payer funded federal government, USPS has received none since 1983, doesn't prefund retiree healthcare at all. Why should USPS fund through 2081?!. Write off current USPS debt. Provide a one-time relief payment. Problem solved. I know, the idea of bailing out the postal service with taxpayer funds is unpopular. Yet, we're ok with what seem like cyclical bailouts of the banking industry, auto industry, airline industry, oil industry, etc. The postal service is the backbone of a mailing industry worth trillions. In so doing, it supports almost 10 million American jobs. It moves almost half the world's daily mail volume. It processes the combined annual volume of FedEx and UPS... Twice each week. I could go on, but words don't matter if what is broken is allowed to remain that way. Correct what was done legislatively to the postal service in 2003 and 2006. Before these 'fixes', the USPS was heavily in the black with over 40% more career employees. Unfortunately, none of this is likely to happen in our current political climate. I'd think the USPS OIG would be the most concerned with this. After all, no postal service, no real need for a USPS OIG, now is there?..

    May 31, 2020
  • anon

    1. Why do we need service everyday? Can't you do the following: 1a. Move to a 4 day work week with longer hours (Tuesday-Friday). 1b. Move the workers to part-time and have them work 3 days and other half 3 days temporarily 2. You give so much stuff away for free. 3. Consolidate locations. Do we need a post office everywhere? Put drops off boxes. Maybe 100-200 drops per real location. 4. Contract delivery to third parties (not last mile but feeder drivers). 5. Rethink the business of delivery. Do you need to use physical stamps? All you want is the money, right? 6. Downsize...1.5 million employees, really? That's bigger than Walmart...

    May 11, 2020
  • anon

    1. Employees are a key stakeholder in the decision process. Cutting hours, or changing how hours are spread across days, is not something that management should do at the flip of a switch. 2. What "stuff" is given away for free? The postal service is in the business of providing a service. The actual materials provided (stamps and the like) are sold for use later on in the service. 3. Believe it or not, the USPS has been trying quite hard to consolidate locations. See, what ends up happening is everyone is fine with the general idea of closing underused USPS locations, at least, up until their local location ends up on the chopping block. 4. "Contract delivery to third parties (not last mile but feeder drivers)." This is ambiguous. Either it is delivery (in which case it is last mile) or it isn't. If you mean non-last-mile transportation, good news: That is very heavily outsourced. If you mean last mile, then that isn't outsourced much (although there are a few cases here and there). But see point 1, earlier, about the feasibility of yanking those jobs. 5. "Rethink the business of delivery. Do you need to use physical stamps? All you want is the money, right?" Not sure what you are saying here. If your intention is to abolish the use of physical stamps, a. you do realize that the actual production cost of a stamp is very low compared to its face value, right? b. What form of payment-evidence scheme do you suggest as an alternative? 6. Downsizing, see point 1. Also, the USPS doesn't have 1.5 million employees, it has just 633,000 as of 2019. Also, Walmart has 2.3 million employees, which is bigger than the USPS (even if one were to use your incorrect employee count for the USPS).

    May 26, 2020
  • anon

    The real problems with the Post Office is Congress, Unions, and promoted-from-within management.

    May 25, 2020
  • anon

    We may need to temporarily go to delivering 5 days a week. I expect the USPS has polled people to find out the days they prefer but, with so many unemployed because of Covid19, I believe those results are outdated. If we are to drop a day I suggest Monday. Why? Because those who are now unemployed will likely continue to think of Monday as “the start of the work week.” And without a job getting bills would only hit harder.

    May 08, 2020