Impacts Associated with Local Transportation Optimization in Richmond, Virginia
Background
The Postal Service deployed a major change to operations within the Richmond, VA, area on October 28, 2023, when it implemented its Local Transportation Optimization initiative. The initiative is designed to reduce the overall number of transportation trips to and from select Post Offices and increase the amount of mail transported on each trip. In this new initiative, the Postal Service will no longer transport mail collected at select delivery units to the Richmond Regional Processing and Distribution Center (RPDC) the same day it is collected. Rather, the mail will remain at the unit until the next day, delaying its entry into sorting operations.
What We Did
Our objective was to determine impacts associated with the Postal Service’s new Local Transportation Optimization initiative in Richmond, VA.
What We Found
Although there may be significant savings, the Postal Service and public do not fully know the operational, service, and customer impacts of the Local Transportation Optimization initiative. The Postal Service implemented this change while simultaneously implementing its first RPDC, handling Election Mail for local elections, and processing the increased mail volumes of its peak mailing season in the same area.
While we are not able to isolate the service impact of Local Transportation Optimization, service performance decreased significantly in the weeks following implementation. Although service performance improved after peak mailing season concluded in January, it was still below levels compared to the same period last year for all mail classes. Further, this initiative will affect rural communities and individuals who mail letters and packages more than other users of the Postal Service.
Management stated once operations are stable, it estimates $7 million in savings annually for the Richmond region from this initiative. Management added they are in the early stages of tracking savings from this initiative and will continue to do so as it is rolled out to other locations.
Recommendations and Management Comments
We made one recommendation to address the issues identified in the report, and Postal Service management agreed. Management’s comments and our evaluation are at the end of the finding and recommendation. The U.S. Postal Service Office of Inspector General (OIG) considers management’s comments partially responsive to the recommendation.