VETERANS AFFAIRS

Actions Needed to 

More Effectively 

Manage Outgoing 

Mail

Report to the Chairman, Committee on 

Veterans' Affairs, House of 

Representatives

July 2017

GAO-17-581

United States Government Accountability Office
United States Government Accountability Office

Highlights of GAO-17-581, a report to the 

Chairman, Committee on Veterans’ Affairs, 

House of Representatives

July 2017

VETERANS AFFAIRS

Actions Needed to More Effectively Manage 

Outgoing Mail

What GAO Found

The Department of Veterans Affairs (VA) is not managing its outgoing mail 

effectively as it lacks key elements of an effective mail management program, 

including reliable data on mail volume and expenditures, agency-wide 

performance measures for mail operations, and mail managers with appropriate 

authority and responsibilities. 

• Reporting reliable mail expenditure and volume data: The mail data VA 

reports to the General Services Administration (GSA) are unreliable, in part 

because VA’s fragmented process for procuring mailing equipment prevents 

VA from tracking mail volume and expenditures consistently across facilities.

Specifically, each fiscal year, hundreds of VA facilities individually enter their 

mail expenditure and volume data into a GSA database that collects mail 

data from federal agencies. These data are collected through inconsistent 

processes. For example, some facilities use mailing equipment and 

associated software that can automatically track volume and costs by service 

provider and mail class, while other facilities’ equipment may be too old to 

have this capability or they use spreadsheets, bills, or receipts to track their 

costs. These processes are inconsistent because VA’s different components 

and facilities contract for mailroom equipment independently of one another.

VA lacks an overall plan to procure mailing equipment strategically. Through 

such procurement, VA could implement a system that would more 

consistently track data on mail expenditures and volume. This step would not 

only improve the reliability of these data but could also allow VA to take 

advantage of price discounts typically available under broader contracts. 

• Measuring performance: VA is unable to evaluate the overall efficiency of its 

mail program because its mail management policy does not include agencywide goals and performance measures for its mail operations, and it has 

inconsistent measures across its facilities. For example, of the 10 VA 

facilities GAO reviewed, some assessed performance using customer 

service, efficiency, volume, and cost, while others used annual expenditures, 

among other measures. Updating the policy to include agency-wide goals 

and performance measures would allow VA to track progress toward 

consistent goals and provide it with crucial performance information needed 

to make programmatic decisions.

• Mail managers with appropriate authority and responsibilities: VA’s ability to 

oversee mailing practices across its facilities is limited because it has not 

provided its mail managers with appropriate authority and responsibilities, 

per federal internal control standards. The agency mail manager’s 

responsibilities are limited to oversight of VA’s mail policy, with no 

operational role in mail management. Additionally, mail managers for the 

Veterans Health Administration and Veterans Benefits Administration 

reported that they advise individual facilities on mail management but have 

no authority to direct their mail operations. Without determining appropriate 

authority and responsibilities for its mail managers, VA is unable to ensure 

that its facilities are managing their mail effectively. 

View GAO-17-581. For more information, 

contact Lori Rectanus at (202) 512-2834 or 

rectanusl@gao.gov. 

Why GAO Did This Study

VA sends hundreds of millions of 

pieces of mail to veterans and their 

dependents, including prescription 

medications and information about 

benefits or disability compensation. 

However, VA’s reported mail volume 

and costs—$355 million in 2016—are 

among the highest in the federal 

government. GAO was asked to review 

VA’s mail management practices. 

This report examines the extent to 

which VA manages its outgoing mail 

effectively. GAO identified key 

elements of an effective mail 

management program from federal 

regulation and internal control 

standards; reviewed VA-reported mail 

expenditure and volume data for fiscal 

years 2015 and 2016; collected 

information on mailing practices at 10 

VA facilities with the highest mail 

volume in fiscal year 2015; and 

interviewed representatives of VA, 

GSA, the U.S. Postal Service, VA’s two 

primary mailing equipment vendors,

and two of the nation’s largest veterans 

service organizations. 

What GAO Recommends

To manage its mail program more 

effectively, VA should develop and 

document a plan to improve how VA

procures mailing equipment, update

mail policy to include goals and 

performance measures, and determine 

and document the authority and 

responsibilities of the agency and 

administration-level mail managers to 

enable them to better manage and 

oversee mail operations. VA concurred 

with these recommendations.
Page i GAO-17-581 Veterans Affairs Mail Management

Letter 1

Background 3

VA Is Not Managing Its Mail Program Effectively 7

Conclusions 15

Recommendations for Executive Action 16

Agency Comments 16

Appendix I Comments from the Department of Veterans Affairs 18

Appendix II GAO Contact and Staff Acknowledgments 19

Figure

Figure 1: Department of Veterans Affairs’ Administrations, 

Facilities, and Examples of Mail to Veterans 4

Abbreviations

CMOP Consolidated Mail Outpatient Pharmacy

FMR Federal Management Regulation

FMS Financial Management System

GSA General Services Administration

OMB Office of Management and Budget

SMART Simplified Mail Accountability Reporting Tool

UPS United Parcel Service

USPS U.S. Postal Service

VA Department of Veterans Affairs

VBA Veterans Benefits Administration

VHA Veterans Health Administration

VISN Veterans Integrated Service Network

Contents

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Page 1 GAO-17-581 Veterans Affairs Mail Management

441 G St. N.W.

Washington, DC 20548

July 31, 2017

The Honorable Phil Roe, M.D.

Chairman

Committee on Veterans’ Affairs

House of Representatives

Dear Mr. Chairman:

Each year, the Department of Veterans Affairs (VA) sends hundreds of 

millions of pieces of mail to veterans and their dependents, who rely on 

this mail for medications and critical information about medical 

appointments, disability compensation, pension benefits, and more. VA’s 

reported mail volume and costs—approximately $355 million in 2016—

are among the highest in the federal government. Moreover, VA’s 

reported costs have nearly doubled since 2009. GAO has raised 

concerns about how VA identifies its resource needs and ensures that 

resources are efficiently used across the agency.1 To the extent that VA’s 

mail management is not cost- effective, VA is losing opportunities to 

better leverage resources to assist veterans and their families. Given the 

growth in reported mail costs, you asked us to review VA’s mail 

management practices. This report examines the extent to which VA 

manages its outgoing mail effectively.

To perform this work, we identified key elements of an effective mail 

management program by reviewing federal mail management 

requirements in the Federal Management Regulation (FMR), which 

governs mailing activities in federal agencies.2 The applicable elements 

from the FMR are: (1) reporting reliable mail data, (2) measuring 

performance, and (3) having mail managers with the authority to manage 

the program.3 We also identified applicable federal internal control 

standards, including the control environment, control activities, and 

 1

GAO, High-Risk Series: An Update, GAO-15-290 (Washington, D.C.: Feb. 11, 2015). 

2

41 C.F.R. pt. 102-192.

3

The FMR also includes requirements for agency mail programs related to payment 

processes and finance systems and written mail security policies and plans. Financial and 

security requirements are not included in the scope of this review.

Letter
Page 2 GAO-17-581 Veterans Affairs Mail Management

information and communications.4 To determine the extent to which VA 

has effectively implemented these key elements and internal controls as 

part of its mail management program, we obtained and reviewed key 

documents, such as VA’s mail management policy and contract 

documentation for the Veterans Health Administration’s (VHA) 

Consolidated Mail Outpatient Pharmacy (CMOP) program. We also 

conducted interviews with management officials from the VA Central 

Office, the Veterans Benefits Administration (VBA), VHA, and the CMOP 

program on mail management practices in different components and 

facilities across the agency.5 We also interviewed officials from the U.S. 

Postal Service (USPS) and VA’s two primary mailing equipment 

providers, Neopost and Pitney Bowes. We reviewed the reliability of the 

mail expenditure and volume data VA reported to the General Services 

Administration’s (GSA) Simplified Mail Accountability Reporting Tool 

(SMART) in fiscal years 2015 and 2016.6 The SMART tool is used by 

GSA to collect mail data from federal agencies, as part of GSA’s efforts to 

oversee federal mail practices and ensure that agencies are managing 

their mail operations efficiently and effectively. In an effort to assess the 

validity of VA’s reported mail volume and costs, we reviewed VA’s 

reported fiscal year 2015 and 2016 expenditure and volume data with its 

service providers, USPS, United Parcel Service (UPS), and FedEx.7 To 

supplement our work at the national level, we collected information on the 

mail practices in place at the 10 VA facilities with the highest mail volume 

reported in SMART in fiscal year 2015.8 We collected information from 

each facility including on their SMART-reporting process, their use of 

performance measures for mail operations, and the role of facility mail 

 4

GAO, Standards for Internal Control in the Federal Government, GAO-14-704G 

(Washington, D.C.: Sept. 10, 2014). 

5

We did not interview officials from the National Cemetery Administration based on the 

administration’s low mail volume relative to VHA and VBA.

6

SMART data are reported annually for the entire fiscal year, and therefore fiscal year 

2016 data are the most current available. 

7

USPS noted that its revenue and volume data were not comparable to VA’s SMART data 

for validation purposes. 

8

Although we found VA’s SMART data to be generally unreliable, we used the data to 

select VA facilities because VA has no other centralized data that include mail 

expenditures and volume. The reliability of the mail expenditure and volume data is not 

material to our findings for the 10 facilities. 
Page 3 GAO-17-581 Veterans Affairs Mail Management

managers.9 We observed mail operations and interviewed mailroom 

personnel at a VBA regional benefit office and a VHA medical center. 

While findings from these facilities are not generalizable to all VA 

facilities, they provide examples of VA’s mailing practices. To obtain 

information on GSA’s oversight of VA’s mail management efforts, we 

interviewed officials responsible for mail management policy from GSA’s 

Office of Government-Wide Policy. Finally, to learn about issues veterans 

may face in receiving mail from VA, we interviewed representatives of 

and obtained information from Disabled American Veterans and the 

American Legion. We selected these veterans service organizations 

because their memberships are among the highest in the country.

We conducted this performance audit from June 2016 to July 2017 in 

accordance with generally accepted government auditing standards. 

Those standards require that we plan and perform the audit to obtain 

sufficient, appropriate evidence to provide a reasonable basis for our 

findings and conclusions based on our audit objectives. We believe that 

the evidence obtained provides a reasonable basis for our findings and 

conclusions based on our audit objectives.

VA is comprised of several entities, including its Central Office in 

Washington, D.C., and three administrations —VHA, VBA, and the 

National Cemetery Administration. Because these entities each provide 

different services for veterans, they each handle different types of 

outgoing mail. See figure 1 for a description of the services each 

administration and their associated facilities provide, and examples of 

outgoing mail.

 9

We initially planned to evaluate the 10 facilities against best practices for mail 

management but subsequently determined that these were not appropriate criteria to 

assess the state of VA’s mail operations.

Background
Page 4 GAO-17-581 Veterans Affairs Mail Management

Figure 1: Department of Veterans Affairs’ Administrations, Facilities, and Examples of Mail to Veterans

VA sends hundreds of millions of pieces of mail annually as part of its 

mission to provide care and benefits to veterans and their dependents. 

For example, VBA mails correspondence related to compensation and 

copies of documents to veterans service organizations, and VHA mails 

prescription medications and letters to notify veterans of medical 

appointments. Within VHA, the CMOP program processes high-volume 

prescription mailings from medical centers using an automated 

dispensing system. The CMOP program includes seven facilities across 

the country that together mail 84 million parcels annually (filling 

approximately 80 percent of VA’s total prescriptions each year).10

Within VA, each administration and local facility has discretion regarding 

how to handle outgoing mail. For example, a facility can use USPS as its 

service provider, or it can choose to use a different service provider, such 

as UPS or FedEx. SMART data indicate that most of VA’s outgoing mail 

was sent via USPS in fiscal year 2016, although VA facilities also used 

UPS and FedEx. In addition to choosing service providers, VA facilities 

 10The seven facilities are located in Leavenworth, Kansas; Tucson, Arizona; Chelmsford, 

Massachusetts; Dallas, Texas; Murfreesboro (Nashville), Tennessee; Hines (Chicago), 

Illinois; and Charleston, South Carolina.
Page 5 GAO-17-581 Veterans Affairs Mail Management

often have contracts to purchase or lease mailing equipment such as 

postage meters.11 As noted above, the CMOP program handles largescale prescription mailings and contracts with a vendor that provides mailmanifesting services (i.e., the weighing and application of pre-paid 

postage or freight charges to parcels, and the delivery of parcels to USPS 

or a third-party carrier) for the seven CMOP facilities.

VA, as any other federal agency, is required to follow certain provisions in 

the FMR regulating mail management. Specifically, the FMR prescribes 

policy and requirements for the effective, economical, and secure 

management of incoming, internal, and outgoing mail and materials in 

federal agencies.12 Among other things, the FMR includes reporting, 

performance measurement, and agency mail manager requirements.

• Reporting Requirements: Large federal agencies must provide annual 

mail management reports to GSA using the web-based SMART 

application.13 The FMR requires large agencies to submit mail 

management reports to ensure agencies have the policies, 

procedures, and data to manage their mail operations efficiently and 

effectively.14 Among other data, mail management reports must 

include: total expenditures paid to each mail service provider, total 

volume of mail pieces, volume and expenditures on mail that was 

undeliverable as addressed, number of full-time equivalent employees 

and contractors who have taken training to earn professional 

certifications, and expenses paid on additional contracts for mail 

services.15 Each year on October 1, GSA opens SMART for agencies 

 11Postage meters allow personnel to print postage indicia (postal markings) directly onto 

mail or onto a meter tape or label that is then affixed to mail.

1241 C.F.R. § 102-192.5. 

13Large agencies are those whose collective total payments to all mail service providers 

equal or exceed $1 million per fiscal year. 41 C.F.R. §§ 102-192.35, 102-192.85.

1441 C.F.R § 102-192.95. GSA also requires agencies to submit an annual agency mail 

management report to ensure that appropriate security measures are in place, and allow 

GSA to fulfill its responsibilities under the Federal Records Act, especially with regard to 

sharing best practices, information on training, and promulgating standards, procedures, 

and guidelines.

15GSA guidance requires large agencies to report the number of full time equivalents and 

contractors who have achieved industry certifications such as the Mail Systems 

Management Association’s Certified Mail and Distribution Systems Manager program, 

USPS’s Executive Mail Center Manager and Mailpiece Design Professional programs, the 

International Publishing Management Association’s Certified Mail Manager program, 

MAILCOM certification programs, and other mail-related certifications.
Page 6 GAO-17-581 Veterans Affairs Mail Management

to manually input their data for the prior fiscal year. According to the 

manual for the SMART application, agencies are to enter annual 

expenditures and number of pieces mailed under each mail class and 

service provider, and the application calculates a cost per piece 

automatically. The agency mail manager is required to compile data 

from all offices or components and submit one report for the agency to 

GSA by December 1 each year.16 Aggregating the SMART data at the 

agency level allows GSA to compare one agency to another on 

performance measures such as cost per piece. GSA officials said they 

review overall trends, training, whether mail piece counts are 

consistent with the expenditures, variances from the previous year, 

and whether the data suggest the need for any revisions to the FMR.

• Performance Measurement Requirements: All federal agencies must 

have performance measures for mail operations at the agency level 

and in all mail facilities and program levels. Performance measures 

are required so that the agency can gauge the success of agency mail 

management plans and processes by comparing performance over 

time and among organizations. Further, according to the FMR, 

performance measures enhance resource allocation and provide 

accountability.17

• Agency Mail Manager Requirements: Federal agencies are required 

to have an agency mail manager who should be at a managerial level 

that enables the official to speak for the agency on mail 

management.18 The FMR enumerates general responsibilities that the 

agency mail manager should carry out including, among others, 

establishing written policies and procedures for timely and costeffective dispatch and delivery of mail; ensuring agency-wide 

awareness and compliance with service provider standards and 

operational procedures, and promoting professional certification for 

mail managers and mail center employees.19

 1641 C.F.R. §§ 102-192.85, 102-192.105.

1741 C.F.R. §§ 102-192.110, 102-192.115. 

1841 C.F.R. §§ 102-192.120, 102-192.125.

1941 C.F.R. § 102-192.130.
Page 7 GAO-17-581 Veterans Affairs Mail Management

VA is not managing its mail program effectively, as it lacks key elements 

of an effective mail management program, including having reliable data 

on mail volume and expenditures, agency-wide performance measures, 

and mail managers with appropriate authority and responsibilities. First, 

VA does not report reliable data to GSA because VA lacks a system to 

track mail volume and expenditures consistently and does not have an 

overall plan to source contracts for the mailing equipment that would 

provide this capability in a more strategic manner. Second, VA is unable 

to evaluate the overall efficiency of its mail program because its mail 

management guidance has not been updated to include agency-wide 

goals and performance measures for its mail operations. Finally, VA 

cannot ensure consistent mailing practices in its administrations and 

facilities because it has not provided mail managers with appropriate 

authority and responsibilities to oversee mail operations across the 

agency.

The mail data VA reports to GSA in its annual mail management report is 

unreliable, in part because VA’s fragmented process for procuring mailing 

equipment prevents VA from tracking mail volume and expenditures 

consistently across facilities. Federal internal control standards call for 

agencies to obtain relevant data from reliable internal sources and 

communicate quality information—that is, information which is 

appropriate, current, complete, accurate, accessible, and provided on a 

timely basis—to external parties to achieve objectives.20 We found 

problems in VA’s fiscal year 2015 and 2016 SMART data related to 

unreported, incomplete, or questionable data, for example:

• Unreported Data: Mail data for the National Cemetery 

Administration—along with most of VA’s 1,055 community-based 

outpatient clinics and 300 vet centers, as well as other VA facilities—

were not accounted for in VA’s SMART reports.

• Incomplete Data: Several facilities submitted incomplete data, such as 

for mail expenditures without accompanying mail volume or vice 

versa. Facilities also did not consistently report data on mail that was 

undeliverable as addressed. We found in 2015 that VBA did not keep 

data on its undeliverable mail, and in our review, VHA’s mail manager 

 20GAO, Standards for Internal Control in the Federal Government, GAO-14-704G 

(Washington, D.C.: Sept. 10, 2014). 

VA Is Not Managing 

Its Mail Program 

Effectively

Fragmented Process for 

Procuring Mailing 

Equipment Has 

Contributed to VA’s 

Inability to Track and 

Report Reliable Mail Cost 

and Volume Data
Page 8 GAO-17-581 Veterans Affairs Mail Management

could not confirm whether VHA facilities accurately track these data.21

Additionally, according to VHA’s mail manager, many medical centers 

do not account for their on-site pharmacies’ outgoing mail in their 

SMART data.22

• Anomalous Data: Several facilities submitted data of questionable 

accuracy. For example, a regional benefit office reported spending 

$9,108 to mail 29 pieces of Priority Express Mail (equating to a cost of 

$314 per piece), and a medical center reported spending $507,000 to 

mail 13,000 pieces of USPS Business Reply Mail (equating to a cost 

of $39 per piece). According to VA, these and other figures were 

based on typographical errors by VA personnel in entering the 

expenditure and volume data.

We also provided VA’s fiscal year 2015 and 2016 data to FedEx and 

UPS: neither could validate the information we obtained from SMART 

with their own records.23

To collect data for SMART reporting, VA relies on data submitted by its 

facilities, and these facilities use inconsistent processes for tracking the 

data. Specifically, according to VA officials, many facility mail rooms use 

mailing equipment like postage meters to track data on mail volume and 

expenditures. The types of mailing equipment that facilities use vary 

considerably in the capability to track mail volume and expenditure data. 

For example, VA officials reported that facilities with newer mailing 

equipment may have also purchased enhanced accounting software from 

the vendor that enables them to track mail expenditures and volume by 

service provider and individual classes of mail—such as Priority or FirstClass Mail. Conversely, other facilities’ equipment may not be configured 

or may be too old to accept the accounting software to be able to track 

classes of mail separately. In addition, facilities may rely on manual-entry 

methods, such as Excel spreadsheets, or copies of bills and receipts from 

service providers to track mail volume and expenditure data. As a result, 

 21GAO, Post-9/11 GI Bill: Additional Actions Needed to Help Reduce Overpayments and 

Increase Collections, GAO-16-42 (Washington, D.C.: Oct. 21, 2015).

22The outgoing mail from VHA on-site pharmacies could include controlled substances, 

such as some prescription medications. We recently reported that VHA’s ability to detect 

diversion of controlled substances is limited because of weaknesses in the implementation 

of VHA’s inspection programs. See GAO, VA Health Care: Actions Needed to Ensure 

Medical Facility Controlled Substance Inspection Programs Meet Agency Requirements,

GAO-17-242 (Washington, D.C.: Feb. 15, 2017).

23Our review did not include an audit of VA’s financial payment processes.
Page 9 GAO-17-581 Veterans Affairs Mail Management

VA has no assurance that facilities are tracking their mail information 

consistently or completely.

The mail volume and expenditure data from roughly 200 VA facilities are 

individually entered into SMART by VA personnel. VA has no agencywide system for tracking mail volume and expenditure data, and therefore 

VA’s administration-level mail managers have limited ability to validate 

the data before the agency mail manager submits the mail management 

report to GSA.24 VHA’s and VBA’s mail managers told us they look for 

anomalous entries, but they cannot verify the data’s accuracy without 

individually contacting the personnel who input the data to check their 

sources (e.g., the mailing equipment, spreadsheets, or service provider 

bills and receipts). Neither VHA’s nor VBA’s mail manager could provide 

us assurance that the SMART data from their administration were 

accurate. They also reported that they lack the authority to compel 

facilities to report data to SMART. GSA officials reported that they check 

for data entries in SMART that vary by at least 10 percent from the 

previous year’s entry and discuss questionable data with reporting 

agencies, but it is each agency’s responsibility to report accurate 

information. GSA officials also told us the challenges VA has encountered 

in reporting to SMART are typical of other agencies. We reported in our 

2015 High-Risk Series update that VHA oversight efforts are often 

impeded by its reliance on facilities’ self-reported data—such as 

certification from medical centers that specialty care consultations have 

been completed— which lack independent validation and are often 

inaccurate or incomplete.25

VA’s inconsistent processes for tracking mail data are in part the result of 

fragmented procurement practices for mailing equipment across the 

agency in which different components of VHA and VBA make contracting 

decisions for mailroom equipment independently. Specifically, VA does 

not strategically acquire equipment that allows facilities to consistently 

collect, track, validate, and report mail data. According to the Office of 

 24VBA officials reported that VBA’s online web-based systems track expenditures, but not 

mail volume or mail class information required in SMART. VA personnel also record mail 

expenditures in the agency’s Financial Management System (FMS) accounting system; 

however, similarly, FMS includes no information on mail volume.

25Every two years at the start of a new Congress, GAO calls attention to agencies and 

program areas that are high risk due to their vulnerabilities to fraud, waste, abuse, and 

mismanagement, or are most in need of transformation. GAO, High-Risk Series: An 

Update, GAO-15-290 (Washington, D.C.: Feb. 11, 2015).
Page 10 GAO-17-581 Veterans Affairs Mail Management

Management and Budget (OMB), strategic sourcing is the collaborative 

and structured process of critically analyzing an organization’s spending 

and using this information to make business decisions about acquiring 

commodities and services more effectively and efficiently.26 For example, 

VBA reported that each of its 56 regional benefit offices negotiates and 

purchases its own contract with authorized vendors. VHA reported that 

the contracts for mailing equipment at its 170 medical centers are 

established at various levels —in some cases, medical centers may 

establish their own contracts, while in others, a Veterans Integrated 

Service Network (VISN) establishes a contract for all the medical centers 

within a region.27

Because of this procurement process, VA is missing opportunities to track 

mail expenditure and volume data consistently and facilitate the SMARTreporting process. Further, VA may be expending unnecessary additional 

funds on procuring mail equipment and missing opportunities to take 

advantage of its substantial buying power.28 Strategic sourcing involves 

consolidating similar requirements to manage them collectively and reap 

cost savings and efficiency gains. If an organization has business units 

across many locations or functions, it is often most economical for a 

central office to negotiate procurement contracts on behalf of the entire 

organization. In the case of VA, it is likely that having facilities or other 

units individually negotiate contracts is not cost-effective because this 

practice does not take advantage of the extent of price discounts that 

might be available under procurement contracts covering much larger 

segments of the agency. In fact, representatives from VA’s two primary 

mailing equipment providers told us that the agency lacks a consistent 

contracting approach to address its mailroom needs. Representatives 

from one provider estimated that it has about 3,000 contracts with VA 

 26Office of Management and Budget, Memorandum for Chief Acquisition Officers, Chief 

Financial Officers, and Chief Information Officers on Implementing Strategic Sourcing

(Washington, D.C.: 2005). 

27Each of VHA’s VISNs is responsible for overseeing medical centers within a specified 

geographic area.

28We have found in the past that the agency has not consistently taken advantage of its 

large size in its purchases. See GAO, Veterans Affairs Contracting: Improvements in 

Policies and Processes Could Yield Cost Savings and Efficiency, GAO-16-810 

(Washington, D.C.: Sept. 16, 2016). In this report, we recommended that VA conduct a 

review of VISN-level strategic sourcing efforts, identify best practices, and, if needed, 

issue guidance to facilitate consolidation of similar requirements and leverage buying 

power across medical centers within VISNs. VA agreed with this recommendation, but has 

not yet implemented it. 
Page 11 GAO-17-581 Veterans Affairs Mail Management

facilities and said that if VA were to negotiate fewer contracts at higher 

levels of the department, VA would almost certainly reap cost savings. 

For example, representatives said that VHA’s VISNs could negotiate 

contracts for multiple medical centers within a region, rather than each 

medical center purchasing its own standalone mailing equipment.

While VBA has taken preliminary steps to source its mailing equipment 

strategically, VA lacks an overall plan to source its contracts for mailing 

equipment in a more strategic manner. VBA officials told us in July 2016 

that its administration and field operations offices were collaborating to 

establish a blanket purchase agreement for mailing equipment in 56 

regional benefit offices across the country. According to VBA, the contract 

is intended to provide opportunities to negotiate improved discounts and 

leverage buying power through volume purchasing, among other things. 

Officials stated that they also intend to include software in the contract 

that would consolidate data across the regional benefit offices and allow 

centralized reporting to SMART through web-based accounting software 

linked to VBA Central Office. VBA initially targeted the end of fiscal year 

2017 to finalize the contract; however, in February 2017, officials said that 

it will take several years to establish the contract because some regional 

benefit offices will not be able to join until their current contracts expire. 

VBA officials stated that they were interested in including VHA in the 

contract in order to obtain better prices. However, they said that VBA has 

not had any detailed discussions with VHA about the contract and told us 

that differences in the administrations’ management structures could 

affect the process. Moreover, VHA’s mail manager told us that he does 

not have the authority to coordinate VHA’s involvement in the contract 

with VBA. By not contracting to procure more standardized equipment, 

VA is missing opportunities to track and report mail data more 

consistently and realize cost savings.

VA’s mail policy does not include agency-wide goals and performance 

measures for mail operations, and as a result, VA is unable to determine 

the extent to which its mail operations are efficient and effective. We have 

previously found that results-oriented organizations set performance 

goals to clearly define desired program outcomes.29 The FMR requires 

that federal agencies have performance measures for mail operations at 

 29GAO, Executive Guide: Effectively Implementing the Government Performance and 

Results Act, GAO/GGD-96-118 (Washington, D.C: June 1996).

VA’s Mail Policy Does Not 

Include Agency-Wide 

Goals and Performance 

Measures
Page 12 GAO-17-581 Veterans Affairs Mail Management

the agency level and in all mail facilities and program levels.30 We have 

previously found that measuring performance allows organizations to 

track progress toward goals and provides managers with the crucial 

performance data needed to make management decisions.31 On its 

website, GSA suggests that federal agencies establish performance 

measures for outgoing mail that address elements of mail operations, 

such as cost per piece by mail class and the percentage of outgoing mail 

that is returned as undeliverable as addressed, as well as management 

measures such as the annual hours of training per full-time equivalent 

employee, and measures for contracts and service level agreements, 

such as the appropriate postage meter size for a mail center operation.

VA’s mail policy includes no agency-wide goals or performance measures 

for mail operations; however, officials stated that performance measures 

may have been developed by individual facilities. At the 10 facilities we 

reviewed, we found that they were not using a consistent set of 

performance measures. These facilities reported using various 

performance measures for mail operations, such as metrics regarding 

customer service, efficiency, volume, cost, accuracy, and staff 

performance. For example, officials from one medical center said that 

they measure customer service, efficiency, safety, and security, while 

officials at another medical center said they measure annual expenditures 

from the prior fiscal year. Officials from two regional benefit offices 

indicated that they have implemented timeliness standards for their mail. 

VHA’s CMOP program also has performance measures for delivery of 

prescription medications but these metrics are implemented for the 

program’s vendor, not an on-site mail operation. The CMOP program 

outsources management of its prescription drug mail to a logistics vendor 

that is responsible for manifesting parcels and providing them to USPS or 

third-party providers for delivery. For example, the vendor must resolve 

delivery inquiries within 48 hours and transport parcels to arrive at USPS 

within 36 hours and return recalled or damaged parcels in the next 

available truck.

VA lacks agency-wide performance measures for mail operations 

because its mail management policy does not address the FMR

performance measures requirement. Directive 6340—VA’s 1996 mail 

 3041 C.F.R. § 102-192.110.

31GAO, Federal Protective Service: Preliminary Results on Efforts to Assess Facility Risks 

and Oversee Contract Guards, GAO-12-943T (Washington, D.C.: July 24, 2012). 
Page 13 GAO-17-581 Veterans Affairs Mail Management

management policy directive and handbook—predates current mail 

management regulations and has not been updated. In July 2016, VA 

officials told us that efforts to update the policy involving collaboration with 

GSA, the Centers for Medicare & Medicaid Services, and USPS were 

under way. However, in February 2017, VBA and VHA mail managers we 

spoke to said they were unaware of any such efforts. As of May 2017, VA 

had not provided documentation of this ongoing effort. The lack of an 

updated policy is not unique to VA’s mail management. For example, we 

previously found that in 2016, almost 60 percent of VHA’s policies had not 

been reviewed in at least 5 years to ensure they are up to date and still 

relevant.32 Internal control standards call for agencies to update their 

policies to be consistent with changes in federal law and regulation.33

Without an updated policy providing performance measures across the 

agency, VA’s ability to evaluate the efficiency of its mail operations is 

limited.

Although VA has designated mail managers at the agency and 

administration levels, these mail managers have limited ability to oversee 

mail operations across the agency because VA has not provided them 

with appropriate authority and responsibilities. Federal internal control 

standards call for agencies to provide a framework for delegating 

authority and assigning responsibility to achieve objectives.34 Specifically, 

management should consider the overall responsibilities of a program, 

establish the key roles needed to fulfill the program’s assigned 

responsibilities, and determine the level of authority each key role needs 

to fulfill a responsibility. The FMR requires agencies to have an agency 

mail manager and outlines the individual’s recommended responsibilities, 

which, among others, include:

• establishing written policies and procedures to provide timely and 

cost-effective dispatch and delivery of mail and materials;

 32GAO, High-Risk Series: Progress on Many High-Risk Areas, While Substantial Efforts 

Needed on Others, GAO-17-317 (Washington, D.C.: Feb. 15, 2017). 

33GAO, Standards for Internal Control in the Federal Government, GAO-14-704G 

(Washington, D.C.: Sept. 10, 2014).

34GAO, Standards for Internal Control in the Federal Government, GAO-14-704G 

(Washington, D.C.: Sept. 10, 2014).

VA Has Not Provided Mail 

Managers with Appropriate 

Authority and 

Responsibilities
Page 14 GAO-17-581 Veterans Affairs Mail Management

• ensuring agency-wide awareness and compliance with standards and 

operational procedures established by all service providers used by 

the agency; and

• ensuring that all facility- and program-level mail personnel receive 

appropriate training and certifications to successfully perform their 

assigned duties.

The agency and administration mail managers have limited authority to 

oversee mail operations because VA has not properly determined and 

documented their authorities and responsibilities. According to VA 

officials, the responsibilities of the agency mail manager position are 

limited to oversight of VA Directive 6340—the policy directive and 

handbook that cover the mail program—with no operational role in mail 

management. However, as stated previously, the VA directive was issued 

in 1996 and has not been updated to incorporate current mail 

management regulatory requirements. Additionally, according to the 

agency mail manager, mail operations in VHA and VBA facilities are the 

responsibility of the administration-level mail managers. However, the 

VHA and VBA mail managers reported that although they advise 

individual facilities on mail management, they have no authority to direct 

their mail operations. For example, VHA’s mail manager told us that 

individual facilities pursue mailing discounts independently. Additionally, 

while VBA has broadly outlined the responsibilities of the VBA mail 

manager in a documented position description, the VHA mail manager 

has no documented responsibilities. Further, while the FMR recommends 

that the agency mail manager ensure that all facility- and mail-program 

level personnel receive appropriate training and certifications to perform 

their assigned duties,35 the VHA mail manager said he has never been 

encouraged to attend any training, and both the VHA and VBA mail 

managers said that they do not have the authority to require mail 

management employees to attend training.36 In addition, VA has not 

assigned mail management as the primary duty for its mail managers. 

According to VA, most mail manager positions are secondary duties for 

the designated officials. VA has devolved responsibility for mail 

management to VA’s three administrations and their hundreds of facilities, 

with varying degrees of autonomy. Officials from the 10 VA facilities we 

reviewed stated that they have personnel who are responsible for their 

 3541 C.F.R. § 102-192.130. 

36We identified inadequate training for VA staff as an area of concern in our 2015 HighRisk Series update. See GAO, High-Risk Series: An Update, GAO-15-290 (Washington, 

D.C.: Feb. 11, 2015).
Page 15 GAO-17-581 Veterans Affairs Mail Management

respective mail operations, but most of them had other responsibilities, 

such as logistics, warehouse operations, and mailroom machine 

maintenance.

Because the agency and administration mail managers lack an 

appropriate level of authority and responsibilities, they play a limited role 

in assuring that mail operations across the agency are following 

consistent practices, and therefore, effective oversight of mail operations 

across facilities is hampered. For example, individual facilities are 

generally responsible for their own mail operations with limited direction 

or guidance, as we previously noted. VA risks being unable to ensure that 

its facilities are managing their mail costs as effectively as possible, 

including obtaining available discounts. VA officials told us the agency 

relies on a decentralized program because of its size, the volume of mail 

generated, and the unique nature of each administration’s mission. 

According to officials, a more centralized mail management program 

would result in higher costs, more overhead, and less responsiveness to 

users. However, VA does not need to centralize its mail management 

program to have its mail managers provide leadership and oversight of 

facility mail operations to ensure greater consistency in mailing practices 

across the agency.

VA faces challenges in ensuring that its resources are effectively 

allocated across the agency. Because it lacks key elements of an 

effective mail management program, VA cannot provide assurance that 

facilities are managing their mail efficiently. First, because VA lacks a 

plan for how to source mailing equipment strategically, it cannot track mail 

costs accurately and may be losing opportunities for cost savings and 

efficiencies. Second, because VA has not updated its mail policy to 

establish agency-wide performance measures for mail operations, its 

ability to evaluate the mail program is limited. Setting goals and 

measuring performance allows organizations to track progress and 

provides managers with the crucial performance data needed to make 

management decisions. Finally, VA has not provided its mail managers 

with appropriate authority and responsibilities to oversee mail operations 

across the agency. As a result, these officials play a limited role in 

overseeing the program and coordinating consistent mail management 

practices across administrations and facilities. By working to address 

these issues, VA could help assure the effective allocation of resources, 

thereby possibly allowing the reallocation of some resources to serve 

veterans in other ways.

Conclusions
Page 16 GAO-17-581 Veterans Affairs Mail Management

To manage the mail program more effectively, the Secretary of Veterans 

Affairs should take the following three actions:

• Develop and document a plan to source contracts for mailing 

equipment in a more strategic manner. Such strategic contract 

sourcing should enable facilities to obtain equipment to track mail 

volume and expenditure data more consistently and to maximize cost 

savings.

• Update VA Directive 6340 to incorporate agency-wide goals and 

performance measures for mail operations.

• Determine and document the authority and responsibilities of the 

agency and administration-level mail managers to enable them to 

improve management and oversight of mail operations.

We provided a draft of this report to VA and GSA for review and 

comment. VA concurred with our recommendations, and its response is 

reproduced in appendix I. GSA did not have any comments on the report. 

As agreed with your office, unless you publicly announce the contents of 

this report earlier, we plan no further distribution until 30 days from the 

report date. At that time, we will send copies to the appropriate 

congressional committees, the Secretary of Veterans Affairs, the 

Administrator of the General Services Administration, the Postmaster 

General of the U.S. Postal Service, and other interested parties. In 

addition, the report will be available at no charge on GAO’s website at 

http://www.gao.gov.

If you or members of your staff have questions about this report, please 

contact me at (202) 512-2834 or rectanusl@gao.gov. Contact points for 

our Offices of Congressional Relations and Public Affairs may be found 

Recommendations for 

Executive Action

Agency Comments
Page 17 GAO-17-581 Veterans Affairs Mail Management

on the last page of this report. Major contributors to this report are listed 

in appendix II.

Sincerely yours,

Lori Rectanus

Director, Physical Infrastructure Issues
Appendix I: Comments from the Department of 

Veterans Affairs

Page 18 GAO-17-581 Veterans Affairs Mail Management

Appendix I: Comments from the Department 

of Veterans Affairs
Appendix II: GAO Contact and Staff 

Acknowledgments

Page 19 GAO-17-581 Veterans Affairs Mail Management

Lori Rectanus, (202) 512-2834 or rectanusl@gao.gov

In addition to the contact named above, Samer Abbas and Faye Morrison 

(Assistant Directors), Justin Reed (Analyst in Charge), Amy Abramowitz, 

Bonnie Pignatiello Leer, Malika Rice, Amy Rosewarne, Crystal Wesco, 

and Elizabeth Wood made key contributions to this report.

Appendix II: GAO Contact and Staff 

Acknowledgments

GAO Contact

Staff 

Acknowledgments

(100923)
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