The United States Postal Service made it official: It wishes to nix sorting operations in Springfield.
On Feb. 23, the USPS announced the findings of its five-month study of regional mail processing facilities, and Springfield’s center is among the 223 mail processing sites on the hook for consolidation.
The city’s sorting operation, 500 W. Chestnut Expressway, was selected to be fully consolidated with Kansas City’s processing center, a move USPS officials have said would save the postal service more than $7.9 million annually. The study of its 264 processing facilities also determined 35 would remain open, and six were put on hold for further internal review.
In the mailThe move in Springfield would mean a monthly mailing of a bank statement from Old Missouri Bank on South National Avenue would travel roughly 350 miles round-trip to bank customer Liberty Press on West College Street. The two businesses are only seven miles apart in Springfield.
“It seems like it isn’t monetarily feasible for them to do that,” said Zack McCurdy, a partner of Liberty Press. “I know it is trying to save money, but it looks like it would cost them more in the long run.”
USPS lost $3.3 billion in the quarter ending Dec. 30, and the realignment of mail processing operations nationwide is part of a comprehensive plan to reduce costs by $20 billion by 2015.
Under the local consolidation plan, Old Missouri Bank’s statement currently mailed on Wednesdays to Liberty Press would arrive on Fridays, a day later than normal. Such a delay, due to the circuitous route of mail, would be played out more than a million times each day in the Springfield area.
USPS Mid-America District spokesman Richard Watkins said the Springfield processing facility sorts roughly 1.6 million pieces of mail per day, with 65 percent of that coming from Sectional Center Facilities such as Joplin and Rolla. Since the postal service plans on having direct transportation with those particular SCFs, roughly 1.1 million pieces of mail per day is expected to travel to Kansas City from Springfield with the consolidation.
“This is a radical change for the postal service prompted by radical changes in the way both commercial and residential customers use the postal service,” Watkins said.
On Feb. 17, the USPS submitted to Congress a five-year plan that includes raising the cost of stamps to 50 cents and moving to a five-day delivery schedule.
Time to adjustNeither the bank nor its customer seems overly concerned about losing a day in mail delivery but any longer than that would be problematic, officials said.
“Most of our mail notices are mailed out ahead of time,” said Dave McBeath, Old Missouri Bank’s executive vice president and chief financial officer. “For instance, a notice on the maturity of a certificate of deposit, we mail those ahead of when the certificate would mature. And the same goes for loan notices.”
McBeath said the Springfield-based bank, which operates two branches, sends up to 3,000 pieces of mail every month. He said it utilizes Ozark Mailing Services Inc. to get presorting discounts, and the bank has five or six statement cycles per month, the largest of which – up to 500 pieces – typically comes at the end of the month.
At the crux of USPS’ decisions is a decline in mail volume and a workers’ retirement benefits prefunding requirement that has siphoned $22 billion away from operations since 2006, Watkins said. He said first class mail deliveries have slowed by 25 percent since 2006.
“A lot of banks have started to move to electronic delivery of statements and notices. Of course, that’s one of the things that has led to the (USPS’) problems,” McBeath said, noting he still holds out hope that service won’t change. “We’re all concerned about (consolidation), and we hope that it doesn’t happen, because obviously it affects a lot of people and jobs in the economy.”
More than 250 employees work at the Springfield processing facility, and the USPS has said roughly 60 net jobs would be lost with the consolidation. Retail operations at the facility would remain open.
None of the proposed changes would go into effect until at least May 15 due to a congressionally imposed moratorium. Watkins said the announcement was made in advance of any changes to notify employees whose jobs may be in jeopardy.
Watkins said the implementation of the consolidation is contingent upon the outcome of last September’s proposed revisions to existing service standards. The Postal Regulatory Commission has said it will render its advisory opinion this summer. USPS has asked, and is hopeful the PRC will offer its opinion this spring, so USPS can act once the moratorium is lifted, Watkins said.
While the USPS does not currently operate with the help of tax dollars, it is subject to congressional oversight, a factor that has kept the postal service from being nimble and adjusting to a loss of demand for its services, according to Watkins.
He said the postal service intends to work with local mailers to help them receive appropriate discounts and ensure their mail gets to their customers in a timely fashion in the event that changes occur.
“Bottom line, all we are doing is matching our employees and the facilities we maintain with a declining workload,” Watkins said. “Any other business would do the same, and they wouldn’t even be questioned about it.”[[In-content Ad]]
