United States General Accounting Office

GAO Briefing Report to the Chairman

Subcommittee on the Postal Service

Committee on Government Reform

and Oversight

House of Representatives

March 1997 U.S. POSTAL SERVICE

Information on Post

Office Closures,

Appeals, and Affected

Communities

GAO/GGD-97-38BR

GAO United States

General Accounting Office

Washington, D.C. 20548

General Government Division

B-275119 

March 11, 1997

The Honorable John M. McHugh

Chairman, Subcommittee on the Postal Service

Committee on Government Reform

 and Oversight

House of Representatives

Dear Mr. Chairman:

This briefing report responds to your request for information on the Postal

Service’s closure of post offices.1

 Local post offices have long been a part

of American culture and business, but they have become increasingly

expensive for the Postal Service to maintain.2

 Nevertheless, the Postal

Reorganization Act of 1970 provides that no small post office can be

closed for economic reasons alone. In 1976, Congress added provisions to

the 1970 act to govern whether and how the Service is to close post

offices. This report provides information on (1) the Postal Service process

for closing post offices, (2) the number of post offices closed since 1970,

(3) the number of proposed post office closures appealed to the

independent Postal Rate Commission (PRC) and the disposition of those

appeals, and (4) selected attributes of affected communities for fiscal

years 1995 and 1996.

On February 28, 1997, we briefed the Subcommittee on the results of our

work. As requested, this report summarizes the information we presented

at that briefing.

Background The 1970 act states that “No small post office shall be closed solely for

operating at a deficit. . . .” (39 U.S.C.101(b)). For several years after the act

was passed, Congress appropriated funds to reimburse the Postal Service

for “public service costs” incurred in providing postal services in

communities where post offices were not self-sustaining. The act provides

for reductions in these appropriations over subsequent years. In 1976,

1

A post office closure is when the Service permanently discontinues the operations of an independent

post office (IPO), eliminates its concomitant postmaster position, and provides the affected customers

with alternative postal services, such as rural route services, community post offices, or highway

contract routes (HCR).

2

We recently reported (Postal Service Reform: Issues Relevant To Changing Restrictions on Private

Letter Delivery, (GAO/GGD-96-129B, Sept. 12, 1996)) that of 39,149 post offices, stations, branches, and

other outlets, 17,702 (about 45 percent) reported total annual revenues that were about $1.1 billion

lower than their total expenses in fiscal year 1995. Of these total outlets, about 28,000 were post

offices headed by a postmaster and, according to the Postal Service, are subject to the statutory

closing restrictions discussed in this report.

Page 1 GAO/GGD-97-38BR Post Office Closures
B-275119 

Congress amended the act to place a temporary moratorium on further

service reductions and specifically prohibited closing post offices that

served 35 or more families. While those specific provisions were only

temporary, other provisions included in the 1976 amendments remain in

effect today, and these affect the Service’s decisions to close or

consolidate post offices.3

 These provisions state that before closing a post

office, the Service must (1) consider the effects on the community served,

the postal employees affected by the closure, and the government policy to

provide effective and regular postal services to all areas of the country, as

well as any economic savings to the Service resulting from the closure,

and (2) provide customers with adequate notice at least 60 days before the

proposed date for the closure and provide them with a written proposal to

close the post office and the findings that led to the closure decision. The

provisions established PRC as the appeals examiner for post office

closures. Specifically, the provisions state that any person served by the

post office may, within 30 days after the written notice of the proposed

closure is provided, appeal the proposal to PRC. PRC may affirm the

proposal or remand the entire matter to the Service for further

consideration. Upon remand, the proposed closure is suspended until the

Service has completed its reconsideration. The Service is not required to

notify PRC of the outcome of its reconsideration. The act requires PRC to

rule on the appeal no later than 120 days after receiving it.

Results in Brief The Postal Service has a detailed process for deciding whether to close a

post office and for effecting the closure. The process is to include

obtaining and evaluating post office operational and community

demographic information, postal service delivery options, and comments

from customers who would be affected by the closure of a post office. The

Service has closed 3,924 post offices since 1970. PRC received the first

appeal of a proposed post office closure in 1978. Since the 1976

amendments, there have been 2,614 post office closures and 296

(11 percent) of these closures were appealed to PRC from 1978 through

1996. PRC affirmed the Service’s proposals on 170 (57 percent) of these

appeals; determined that it lacked jurisdiction for 31 (10 percent) of these

appeals, which allowed the Service to proceed as originally intended; and

remanded 58 (20 percent) of these appeals to the Service, usually due to

incomplete data. Selected attributes varied in communities where post

offices were either closed or were proposed to be closed but were

3

A consolidation is the replacement of a post office with a station, branch, or contractor-operated

community post office (CPO). Because the amendment’s provisions on post office closures and related

appeals equally apply to post office consolidations, for purposes of this report, all references to a post

office closure may refer to a closure or to a consolidation of a post office.

Page 2 GAO/GGD-97-38BR Post Office Closures
B-275119 

appealed in fiscal years 1995 and 1996. Attributes of affected communities

included population and number of businesses, and attributes of post

offices within these communities included level of postal service,

postmaster salaries, post office revenues, and annual operating costs. In

most cases, the annual operating costs of the closed post offices and those

proposed to be closed exceeded their postal revenues.

The Post Office

Closing Process

The Postal Service has a detailed process for closing post offices. To assist

its managers in deciding whether to close a post office, the Service

developed and issued the Post Office Discontinuance Guide (Handbook

PO-101), dated January 1, 1994, which provided policy guidance regarding

the appropriate procedures for closing a post office. The guide states that

three circumstances may prompt the Service to initiate a feasibility study

to determine whether to close a post office: (1) a postmaster vacancy;

(2) the emergency suspension of the operations of a post office; or

(3) special circumstances, such as the incorporation of two communities

into one.

According to the guide, under any of these circumstances, postal managers

may conduct a study to evaluate the post office workload and the service

needs of the community. In addition, postal managers are to

• consult with county or city officials for information on population, area or

post office building historical significance, and growth trends within the

community;

• consult with managers of the post office under consideration for closure

and nearby offices that may provide alternative service;

• analyze and rank alternative postal services in order of practicality, costs,

and the maintenance of effective and regular service to the community;

• hold public meetings, poll affected customers using questionnaires, and

propose alternative postal services at less cost; and

• give customers written notice of Service proposals, decisions, and appeal

rights. (See br. section I.)

The Number of Post

Offices Closed

According to Service records, since fiscal year 1970, the Service has closed

3,924 post offices, leaving 28,189 post offices open at the end of fiscal year

1996. These closures averaged 218 per year during the 6-year period (fiscal

years 1970-75) before the 1976 amendments, while closures averaged 124

per year for the 21-year period (fiscal years 1976-96) after the

amendments. In fiscal year 1995, the Service closed 239 post offices—the

Page 3 GAO/GGD-97-38BR Post Office Closures
B-275119 

highest number of closures since the early 1970s, when 385 post offices

were closed in fiscal year 1974. Service officials identified two conditions

that led to the large number of closures in fiscal year 1995. The first

condition was the Service’s 1992 early-out retirement incentive, which was

offered to most of its employees, including postmasters. The second

condition was the Service’s decision to address the accumulation of post

offices whose operations had been suspended due to various emergency

situations. Because of a backlog of potential closures stemming from

postmaster retirements and emergency suspensions of post offices, there

was a delay in closing many of these post offices until fiscal year 1995.

Post office closures diminished to 161 in fiscal year 1996.

We reviewed Postal Service and PRC records for 93 post offices that were

either closed or whose proposed closures were appealed in fiscal years

1995 and 1996. Of the 93 post offices, 50 were closed without appeal and

43 were proposed to be closed but were appealed to PRC.

4

 The records

showed that the closure process for 91 of the post offices was prompted

by postmaster vacancies—retirement, transfer, promotion, or death. For

the remaining two post offices, the records showed that the closure

process for one was prompted by the post office building’s lease expiring

and the other was prompted by the post office building burning. (See br.

section II.)

The Number of

Appeals and Their

Dispositions

PRC received the first appeal of a Service proposal to close a post office in

fiscal year 1978. Since the 1976 amendments, there have been 2,614 post

office closures and 296 (11 percent) of these closures were appealed to

PRC in fiscal years 1978 through 1996. Of these appeals, PRC affirmed the

Service’s proposals in 170 cases (57 percent) and determined that it lacked

jurisdiction in 31 cases (10 percent), which allowed the Service to proceed

as originally intended. PRC determined that it lacked jurisdiction in these

31 cases because 19 cases were not filed within the 30 days required by

law, and 12 cases dealt with issues outside its jurisdiction, such as the

relocation of a post office within the same community. PRC remanded 58

cases (20 percent) to the Service, usually because of incomplete

Service-provided records or other data deficiencies. Postal Service records

did not allow us to readily determine the status of the 58 remanded cases.

Of the remaining 37 cases (13 percent), the Service withdrew its proposals

4

These 43 proposed post office closures resulted in 44 appeals because one proposed closure was

appealed twice. Initially, the proposed post office closure was appealed. PRC remanded the first

appeal to the Service. Next, the Service proposed to close the post office again. Finally, a second

appeal was filed, and PRC affirmed the Service’s decision to close the post office.

Page 4 GAO/GGD-97-38BR Post Office Closures
B-275119 

to close 36 post offices before PRC had ruled on the appeals, and the

appellant withdrew the other appeal.

The act requires that PRC use the Service-prepared administrative records

to review appeals of Service proposals to close post offices. According to

PRC officials, they also used written arguments submitted by the appellants

and the Service. Also, we reviewed 44 appeals and found that PRC had

made its decision in each of these cases within the 120 days required by

law. (See br. section III.)

Selected Attributes of

Affected Communities

When information was available from Service records on post office

closures and proposed closures that we reviewed, we obtained selected

information on postal services provided to and demographic data for the

communities affected by these closures or proposed closures. These

communities had populations ranging from 30 to 2,143, with an average

and median population of 206 and 80, respectively; and businesses ranging

in number from 1 to 39, with an average and median of 6 and 5,

respectively. At the involved post offices, the communities received from

10 to 44 hours of window service per week, with a weekly average of 28

hours of service. The postmaster salaries for these post offices ranged

from $5,773 to $31,664 per year, an average of $13,664 per year. Except for

post offices in four communities, the annual operating costs of the post

offices exceeded their postal revenues. Also, for each community affected

by a closure or proposed closure, records indicated that the Service was to

provide it with less costly alternative postal services, such as establishing

a contract CPO. (See br. section IV.)

Scope and

Methodology

We interviewed Service headquarters and PRC officials responsible for

evaluating post office closures and appeals, and we reviewed laws,

regulations, policies, and procedures relating to closing post offices. We

obtained statistics on the number of post offices, the number closed, and

the number of appeals filed with PRC. We did not obtain statistics on the

number of closed classified stations, branches, and community post

offices because these postal facilities were not covered by the statutory

provisions for post office closures.5

 We reviewed Service and PRC

documents on all 43 proposed post office closures that were appealed—1

proposed closure was appealed twice, resulting in a total of 44 appeals—in

5

The statistics we present in this report on post office closures do not agree with those the Postal

Service publicly reported prior to fiscal year 1995 because the Service’s statistics on post office

closures included not only the total number of closed post offices but also classified stations,

branches, and community post offices.

Page 5 GAO/GGD-97-38BR Post Office Closures
B-275119 

fiscal years 1995 and 1996. In addition to these 44 appealed closures, we

randomly selected and reviewed documents related to 50 post offices that

were closed without appeal in fiscal years 1995 and 1996. We reviewed

Service and PRC decision documents and, when available, obtained

selected information on postal services and demographic data for 93 of the

affected communities, and financial data for the affected post offices. We

also obtained information on the time taken for Service and PRC actions.

We did not verify the accuracy of Service and PRC records.

We did our work in Washington D.C., from August through December 1996

in accordance with generally accepted government auditing standards.

Agency Comments We requested comments on a draft of this report from the U.S. Postal

Service and the Postal Rate Commission. We received written comments

from the Vice President and Controller of the U.S. Postal Service dated

March 6, 1997, and from the Chairman of the Postal Rate Commission on

February 27, 1997, which are reprinted in appendixes III and IV,

respectively. Both officials generally agreed with the facts presented in the

report. Their staffs also provided oral technical comments to clarify,

correct, and update some of the information in the report. We have

incorporated these comments into the report where appropriate.

We are sending copies of this briefing report to the Ranking Minority

Member of your Subcommittee, the Chairman and Ranking Minority

Member of the Senate Committee on Governmental Affairs, the U.S. Postal

Service, and other interested parties. We will also make copies available to

others on request.

Page 6 GAO/GGD-97-38BR Post Office Closures
B-275119 

The major contributors to this report are listed in appendix V. If you have

any questions about this report, please call me on (202) 512-8387.

Sincerely yours,

Michael E. Motley

Acting Director, Government Business

 Operations Issues

Page 7 GAO/GGD-97-38BR Post Office Closures
Contents

Letter 1

Briefing Section I 

Background

10

Briefing Objectives 10

Statutory Provisions for Post Office Closures 12

Statutory Provisions for Appeals of Post Office Closures 14

Service Guidance on When a Post Office May Be Considered for

Closure

16

Postal Service Process for Closing Post Offices 18

Briefing Section II 

Number of Post

Offices Closed

20

Number of Post Office Closures, Fiscal Years 1970-96 20

Events Prompting the Service to Initiate Its Closing Process,

Fiscal Years 1995-96

22

Average Time the Service Took to Close Post Offices, Fiscal

Years 1995-96

24

Briefing Section III 

Proposed Post Office

Closures That Were

Appealed

26

Proposed Closures Appealed to PRC in Fiscal Years 1978-96 26

Appeals of Proposed Closures and Disposition of Appeals, FYs

1978-96

28

Briefing Section IV 

Selected Attributes of

Affected

Communities, Fiscal

Years 1995 and 1996

30

Community Demographics, Fiscal Years 1995-96 30

Postal Services Provided to The Communities, Fiscal Years

1995-96

32

Post Office Financial Data, Fiscal Years 1995-96 34

Alternative Postal Services to Be Provided, Fiscal Years 1995-96 36

Appendix I 

Two Case Studies

Involving Appealed

and Nonappealed

Proposals to Close

Post Offices

38

Case Study 1: An Appealed Decision to Close the Post Office in

Clarkia, ID

38

Case Study 2: A Nonappealed Decision to Close the Post Office in

Octavia, NE

38

Page 8 GAO/GGD-97-38BR Post Office Closures
Contents

Appendix II 

Post Office Closures

and Proposed

Closures Appealed,

Fiscal Years 1995-96

40

Appendix III 

Comments From the

United States Postal

Service

42

Appendix IV 

Comments From the

Postal Rate

Commission

43

Appendix V 

Major Contributors to

This Report

44

Abbreviations

COD Collect on delivery

CPO Community post office

FY Fiscal year

HCR Highway contract route

IPO Independent post office

PO Post office (same as IPO)

PRC Postal Rate Commission

Page 9 GAO/GGD-97-38BR Post Office Closures
Briefing Section I 

Background

GAO Briefing Objectives

Provide information on

The Postal Service process for closing post 

offices

The number of post offices closed since 

1970

The number of proposed post office closures 

appealed to PRC and their disposition

Selected attributes of affected communities

Page 10 GAO/GGD-97-38BR Post Office Closures
Briefing Section I 

Background

Briefing Objectives Our objectives were to obtain information on (1) the Postal Service

process for closing post offices, (2) the number of post offices closed

since 1970, (3) the number of proposed post office closures appealed to

the Postal Rate Commission (PRC), and the disposition of those appeals,

and (4) selected attributes of the affected communities for fiscal years

1995 and 1996., e.g., information on postal services and demographic data.6

6

A post office closure is when the Service permanently discontinues the operations of an independent

post office(IPO), eliminates its concomitant postmaster position, and provides the affected customers

with alternative postal services.

Page 11 GAO/GGD-97-38BR Post Office Closures
Briefing Section I 

Background

GAO Statutory Provisions for Post Office 

Closures

The 1970 Act requires that no small post office be 

closed solely for operating at a deficit. 

The 1976 amendments imposed conditions on post 

office closures: 

The Service must consider effects on community 

served, postal employees, and postal services, and 

economic savings to the Service; and

The Service must provide customers with its 

written proposals and findings.

Customers may appeal the closure to PRC.

Page 12 GAO/GGD-97-38BR Post Office Closures
Briefing Section I 

Background

Statutory Provisions for

Post Office Closures

The Postal Reorganization Act of 1970 (39 U.S.C. 101(b)) states that “No

small post office shall be closed solely for operating at a deficit. . . .” In

1976, Congress amended the act to place a temporary moratorium on

further service reductions and specifically prohibited closing post offices

that served 35 or more families. While these specific provisions were only

temporary, other provisions included in the 1976 amendments, which

remain in effect today, affect the Service’s decisions to close or

consolidate post offices.7

Under the 1970 act as amended, when considering whether to close a post

office, the Service must assess the impact on the community served, the

postal employees, and the postal services as well as any economic savings

to the Postal Service that would result from the closure. The Service must

notify affected customers at least 60 days before the proposed date for the

closure and provide them with its written proposal and findings. Any

person served by the post office involved may file an appeal with the

independent Postal Rate Commission (PRC) within 30 days after the Postal

Service provides written notice that it proposes to close the post office.

7

A consolidation is the replacement of a post office with a station, branch, or contractor-operated

community post office (CPO). Because the amendment’s provisions on post office closures and related

appeals equally apply to post office consolidations, for purposes of this report, all references to a post

office closure may refer to the closure or the consolidation of a post office.

Page 13 GAO/GGD-97-38BR Post Office Closures
Briefing Section I 

Background

GAO Statutory Provisions for Appeals of 

Post Office Closures

The 1976 amendments established PRC as the 

PO closure appeals examiner 

PRC is authorized to

affirm the proposed post office closure, or

remand matter to the Service for further 

consideration

PRC is to use Service-prepared 

administrative record when ruling on an 

appeal

Page 14 GAO/GGD-97-38BR Post Office Closures
Briefing Section I 

Background

Statutory Provisions for

Appeals of Post Office

Closures

The 1976 amendments established PRC as the appeals examiner for the

closure of a post office. These amendments provided that PRC may affirm

the proposal or remand the entire matter to the Service for further

consideration. In doing so, PRC must use the information in the Postal

Service’s prepared administrative record, which contains the analyses,

comments, and other justification for each proposed post office closure.

PRC is required to rule on the appeal within 120 days from the date the

appeal is filed with PRC.

Page 15 GAO/GGD-97-38BR Post Office Closures
Briefing Section I 

Background

GAO Service Guidance on When a Post Office 

May Be Considered for Closure

The Post Office Discontinuance Guide specifies 

three circumstances that may prompt a study to 

consider whether to close a post office:

A vacancy in the postmaster position 

An emergency suspension of a post office's 

operations

Special circumstances 

Page 16 GAO/GGD-97-38BR Post Office Closures
Briefing Section I 

Background

Service Guidance on When

a Post Office May Be

Considered for Closure

The Post Office Discontinuance Guide (Handbook PO-101) specifies three

circumstances that may prompt Service officials to initiate a study to

determine whether a post office should be closed. These circumstances

are (1) a vacancy in a postmaster position arises due to promotion,

transfer, retirement, or death; (2) an emergency suspension of a post

office’s operations occurs due to circumstances such as a natural disaster,

sudden loss of the post office building lease when no suitable alternative

quarters are available, or severe damage to or destruction of the post

office building; or (3) special circumstances, such as the incorporation of

two communities into one.

Page 17 GAO/GGD-97-38BR Post Office Closures
Briefing Section I 

Background

GAO Postal Service Process for Closing 

Post Offices

In January 1994, the Postal Service issued the 

Post Office Discontinuance Guide, which

provides policy guidance on the appropriate 

procedures for investigations; public 

notifications of proposals and decisions; and 

the process for reaching decisions and 

appealing closures.

Service documentation for each proposed post 

office closure is to become the administrative 

record in the event of an appeal.

Page 18 GAO/GGD-97-38BR Post Office Closures
Briefing Section I 

Background

Postal Service Process for

Closing Post Offices

In January 1994, the Service issued its Post Office Discontinuance Guide.

According to Service officials, the guide is to help ensure that Service

procedures are followed, uniform processes are used, and consistent

documentation is prepared for each post office closure. The guide is also

to be used as a training tool and to assist postal field personnel

responsible for reviewing the status of post offices in their districts.

The guide covers the closure of IPOs. It provides policy guidance on the

appropriate (1) procedures for investigations to be undertaken, public

meetings to be held to inform customers of the Service’s plans, and

customer feedback to be obtained; (2) requirements for public notification

of Service proposals and decisions; (3) the Service’s process for reaching

decisions to close post offices; and (4) the appeal process and how the

Service is to respond to an appeal. The guide also provides samples of

necessary forms and reports that need to be prepared. The entire Service

documentation for each proposed post office closure is to become the

administrative record that PRC is required to use, as well as written

arguments submitted by appellants and the Service, when ruling on an

appealed proposed closure.

Page 19 GAO/GGD-97-38BR Post Office Closures
Briefing Section II 

Number of Post Offices Closed

GAO Number of Post Office Closures, Fiscal 

Years 1970-96

70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96

0

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62 55

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65

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86 87

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220 209 218

43

108 118 111

68

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94

239

161

Number of post office closures

Fiscal years

Preamendment closings

(average 218 per year)

Postamendment closings (average 124 per year)

Source: Postal Service data.

Page 20 GAO/GGD-97-38BR Post Office Closures
Briefing Section II 

Number of Post Offices Closed

Number of Post Office

Closures, Fiscal Years

1970-1996

Through fiscal year 1996, the Service had closed 3,924 post offices, leaving

28,189 post offices open at the end of the fiscal year. Since 1970, the

Service has closed an average of 145 post offices each year. The number of

post offices closed during the 6-year period (fiscal years 1970-1975) before

the 1976 amendments averaged 218 per year, while closures for the 21-year

period (fiscal years 1976-1996) after the amendments averaged 124 per

year.

In fiscal year 1995, the Service closed 239 post offices—the highest

number of closures since the 1970s, when 385 post offices were closed in

fiscal year 1974. Service officials identified two conditions that led to the

large number of closures in fiscal year 1995. The first condition was the

Service’s 1992 early-out retirement incentive, which was offered to most of

its employees, including postmasters. The second condition was the

Service’s decision to address the accumulation of post offices whose

operations had been suspended due to various emergency situations.

These postmaster retirements and emergency suspensions of post offices

had caused a backlog in the post office closing process. As a result, many

of the affected post offices were not closed until fiscal year 1995. In fiscal

year 1996, post office closures declined to 161.

Page 21 GAO/GGD-97-38BR Post Office Closures
Briefing Section II 

Number of Post Offices Closed

GAO Events Prompting the Service to Initiate 

Its Closing Process, FYs 1995-96

0

10

20

30

40

50

60

70

59

22

5

3 2 1 1

Number of events

Types of events that initiated the closing process

Postmaster

 

 retired

Postmaster

 promoted

Postmaster

 transferred

Postmaster

 

 resigned

Postmaster

 

 died

Post office

 

 burned

Lost lease

Source: Postal Service and PRC data.

Page 22 GAO/GGD-97-38BR Post Office Closures
Briefing Section II 

Number of Post Offices Closed

Events Prompting the

Service to Initiate Its

Closing Process, Fiscal

Years 1995-96

We reviewed Service and PRC records for 93 post offices that were either

closed or whose proposed closures were appealed in fiscal years 1995 and

1996. The records indicated the Service initiated its closing process after

the following events:

• Postmaster vacancies: vacancies included 59 retirements, 22 promotions, 5

transfers, 3 resignations, and 2 deaths; and

• Emergency suspensions: suspensions included one post office building

with a terminated lease and another post office building severely damaged

by fire.

Postmasters may apply for other positions within the Service, including

other postmaster positions created by vacancies. Postmasters at small

post offices, such as the ones we reviewed, can apply for promotions to

larger post offices.

Page 23 GAO/GGD-97-38BR Post Office Closures
Briefing Section II 

Number of Post Offices Closed

GAO Average Time the Service Took to 

Close POs, Fiscal Years 1995-96

0

1

2

3

4

5

4.1

4.4

Number of years from the event that initiated

the closing process to the closure

Appealed

closings

Nonappealed

closings

Appealed and nonappealed closures

Source: Postal Service and PRC data.

Page 24 GAO/GGD-97-38BR Post Office Closures
Briefing Section II 

Number of Post Offices Closed

Average Time the Service

Took to Close Post Offices,

Fiscal Years 1995-96

Of the 44 Service proposed closures that were appealed in fiscal years

1995 and 1996, 19 had been closed at the time of our review. Data available

for 18 of the 19 closures indicated that the process had taken an average of

4.1 years, ranging from 2.7 years to 9.8 years. For the 50 post office

closures we reviewed for the same period that were not appealed, the

closing process had taken an average of 4.4 years, ranging from 1.2 years

to 13.6 years. These times measure the closing process from when a

postmaster vacancy occurred or an emergency suspension of a post office

took effect to when the Service publicly announced the closure in the

Postal Bulletin.

A detailed analysis of the time taken by the Service to close post offices

was not within the scope of our review. However, we noted that the

Service’s procedures required numerous steps to be completed before a

post office was closed. Postal managers were to conduct a feasibility study

to determine whether to close a post office, which was to include an

evaluation of the post office workload and the service needs of the

community. Postal managers were also to consult with county or city

officials for information about population, area or post office building

historical significance, and growth trends within the community; consult

with managers of the post office under consideration for closure and with

nearby offices that may provide alternative service; analyze and rank

alternative services in order of practicality, costs, and the need to maintain

effective and regular service to the community; hold public meetings; poll

affected customers using questionnaires; propose alternative postal

services; and give written notice of Service proposals, decisions, and

appeal rights.

Page 25 GAO/GGD-97-38BR Post Office Closures
Briefing Section III 

Proposed Post Office Closures That Were

Appealed

GAO Proposed Closures Appealed to PRC 

in Fiscal Years 1978-96

1978 1979 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996

0

5

10

15

20

25

30

35

1

23

10

4

16

30

16

31

21

12

10

14

4

14

13

19

14

22 22

Number appealed

Fiscal years

Source: PRC data.

Page 26 GAO/GGD-97-38BR Post Office Closures
Briefing Section III 

Proposed Post Office Closures That Were

Appealed

Proposed Closures

Appealed to PRC in Fiscal

Years 1978-96

The first appeal of a Postal Service proposal to close a post office was filed

in fiscal year 1978. Since the 1976 amendments, there have been 2,614 post

office closures, and 296 (11 percent) of these closures were appealed to

PRC from fiscal years 1978 through 1996. When considering appeals, the

1970 act, as amended, requires that PRC use the Service-prepared

administrative record. PRC officials told us that they also use written

arguments submitted by the appellant and the Service when ruling on an

appeal.

Page 27 GAO/GGD-97-38BR Post Office Closures
Briefing Section III 

Proposed Post Office Closures That Were

Appealed

GAO Appeals of Proposed Closures and 

Disposition of Appeals, FYs 1978-96

Number of appealed proposals

0

50

100

150

200

170

31

58

37

Affirmed

57%

Lacked jurisdiction

10%

Remanded

20%

Withdrawn

13%

Type of disposition

Source: PRC data.

Page 28 GAO/GGD-97-38BR Post Office Closures
Briefing Section III 

Proposed Post Office Closures That Were

Appealed

Appeals of Proposed

Closures and Dispositions

of Appeals, FYs 1978-96

PRC’s dispositions of the 296 appeals filed through fiscal year 1996 are as

follows:

Affirmed: PRC did not take exception with the Postal Service on 170, or

57 percent, of the appealed closure proposals. PRC ruled that the Service

complied with the requirements of the law and could proceed with the

proposed closures.

Lacked jurisdiction: PRC determined that it lacked jurisdiction for 31, or

10 percent, of the appealed proposed closures. PRC found that 19 of these

appeals were not filed within the 30 days required by law. PRC also found

that the remaining 12 appeals dealt with issues outside its jurisdiction,

such as a Service decision to relocate a post office within the same

community, a suspension of service, or a study of the feasibility of closing

a post office. PRC’s lack of jurisdiction regarding these appeals allowed the

Service to proceed as originally intended.

Remanded: PRC took exception with the Postal Service on 58, or

20 percent, of the appealed proposed closures. PRC ruled that the Service

did not comply with the requirements and suspended the proposed

closure. Postal Service records did not allow us to readily determine the

status of these remanded cases.

In remanded cases, the Postal Service may decide to withdraw a proposed

closure and not close the post office or correct the PRC-noted deficiency in

the record and proceed with closing actions. The Postal Service is not

required to go back to PRC and show that it corrected the deficiency before

closing the post office. (See app. I for a case study of a closure that was

appealed twice.)

Withdrawn: PRC did not rule on 37, or 13 percent, of the appealed proposed

closures because the Service withdrew its proposals to close 36, and the

appellant withdrew the other appeal.

Page 29 GAO/GGD-97-38BR Post Office Closures
Briefing Section IV 

Selected Attributes of Affected

Communities, Fiscal Years 1995 and 1996

GAO Community Demographics, Fiscal 

Years 1995-96

Low High Average

Demographics

Population size

(23 communities) 30 2,143 206

Number of 

businesses

(77 communities)

1 39 6

Data range

Source: Postal Service and PRC data.

Page 30 GAO/GGD-97-38BR Post Office Closures
Briefing Section IV 

Selected Attributes of Affected

Communities, Fiscal Years 1995 and 1996

Community Demographics,

Fiscal Years 1995-96

We reviewed Service and PRC records for 93 communities where post

offices were either closed or whose proposed closures were appealed to

PRC in fiscal years 1995 and 1996. According to data available for 23 of

these communities, resident population size ranged from 30 to 2,143, and

averaged 206. The median population size was 80. Data available for 77

communities showed that the number of businesses ranged from 1 to 39,

and averaged 6. The median number of businesses was 5.

Page 31 GAO/GGD-97-38BR Post Office Closures
Briefing Section IV 

Selected Attributes of Affected

Communities, Fiscal Years 1995 and 1996

GAO Postal Services Provided to the 

Communities, Fiscal Years 1995-96

Low High Average 

Type of service

Window hours

per week

(93 post offices)

10 44 28 

Transactions

per day

(84 post offices)

1 157 13 

General delivery

customers

(56 post offices)

1 52 13 

Data range

Source: Postal Service and PRC data.

Page 32 GAO/GGD-97-38BR Post Office Closures
Briefing Section IV 

Selected Attributes of Affected

Communities, Fiscal Years 1995 and 1996

Postal Services Provided to

the Communities, Fiscal

Years 1995-96

The hours of window service provided to the communities by the 93 post

offices that were either closed or proposed for closure and subsequently

appealed in fiscal years 1995 and 1996 ranged from 10 to 44 hours per

week, with an average of 28 hours per week. Retail services provided

during window service hours included the sale of stamps and money

orders; special services, such as registered, certified, insured,

collect-on-delivery (COD) and Express Mail; the acceptance and dispatch of

all classes of mail; and services to permit mailers and postage meter

customers.

Postal transaction data were available for 84 post offices. The number of

transactions per day for the post offices ranged from 1 to 157, with an

average of 13 transactions per day. The number of general delivery

customers for 56 post offices ranged from 1 to 52, and averaged 13.

Page 33 GAO/GGD-97-38BR Post Office Closures
Briefing Section IV 

Selected Attributes of Affected

Communities, Fiscal Years 1995 and 1996

GAO Post Office Financial Data, Fiscal 

Years 1995-96

Low High Average 

Type of data

(92 post offices)

Postmaster

salary

$5,773 $31,664 $13,644 

Revenue 420 58,891 8,827 

Operating

costs

7,706 47,731 19,656 

Gain (Loss) ($10,829) 

Data range

Source: Postal Service and PRC data.

Page 34 GAO/GGD-97-38BR Post Office Closures
Briefing Section IV 

Selected Attributes of Affected

Communities, Fiscal Years 1995 and 1996

Post Office Financial Data,

Fiscal Years 1995-96

We found complete revenue and operating costs8 for 92 of the 93 post

offices in the affected communities. The postmaster salaries for these 92

post offices ranged from $5,773 to $31,664 per year, an average of $13,644

per year. Postmasters’ salaries were determined by the service level at the

post office they were in charge of operating.

Except for post offices in four communities, the annual operating costs of

the post offices exceeded their postal revenues. The revenue for the 92

post offices ranged from $420 to $58,891 per year, an average of $8,827 per

year. Revenue included receipts from the sale of postage stamps and other

services. Operating costs, which included the postmaster’s salary, fringe

benefits, and rental fees, ranged from $7,706 to $47,731 per year, an

average of $19,656 per year. The total yearly loss to the Service for

operating these 92 post offices was $996,314—an average loss of $10,829

per post office.

8

Operating costs included postmaster salaries.

Page 35 GAO/GGD-97-38BR Post Office Closures
Briefing Section IV 

Selected Attributes of Affected

Communities, Fiscal Years 1995 and 1996

GAO Alternative Postal Services to Be 

Provided, Fiscal Years 1995-96

0

10

20

30

40

50

60

46

22 21

4

Rural route Highway contract

route

Community

post offices

Other types

of services

Type of postal services

Number of communities

Source: Postal Service data

The Service proposed to provide less costly alternative postal service to all

93 communities with post offices that were either closed or whose

proposed closures were appealed that we reviewed. According to Service

and PRC records, 46 communities were to receive rural route service or

rural route service with a cluster box unit. Twenty-two communities were

to receive service via a highway contract route (HCR). Twenty-one

communities were to receive community post offices (CPO). Four

Page 36 GAO/GGD-97-38BR Post Office Closures
Briefing Section IV 

Selected Attributes of Affected

Communities, Fiscal Years 1995 and 1996

communities were to receive other forms of service, including classified

stations, and a combination of HCR delivery and CPOs.

A rural route provides delivery and retail services to customers in rural

areas. Service is usually provided to roadside mailboxes installed by

customers on the mail carrier’s line of travel. The carrier provides retail

services normally provided at post offices. Most transactions do not

require the customer to meet the carrier at the mailbox. Stamps by Mail

and Money Order application forms are available from the carrier for

customer convenience. Carriers will accept packages at the mailbox

without a customer being present, provided the postage is fully prepaid.

Special services such as certified, COD, and Express Mail may be obtained

from the carrier by leaving a note in the mailbox, along with appropriate

payment. Some rural routes provide service to neighborhood delivery and

collection box units9

 rather than roadside mailboxes.

A CPO is a postal operation within a small community that is established on

a contractual basis where an IPO has been closed. A CPO provides the same

services as an IPO (a post office operated by a postmaster) except that a

CPO does not accept permit mail or set postage meters. The CPO bears its

community’s name and ZIP Code as part of a recognized mail address.

An HCR is similar to a rural route except that service is provided by a

contract employee rather than a career postal employee. A classified

station or branch is operated by a career postal employee, not a

postmaster, and provides the same services as an IPO, including accepting

permit mail and setting postage meters.

9

Neighborhood delivery and collection box units are secure, free standing units of individually locked

mail compartments installed and maintained by the Service at no cost to the customer.

Page 37 GAO/GGD-97-38BR Post Office Closures
Appendix I 

Two Case Studies Involving Appealed and

Nonappealed Proposals to Close Post

Offices

The following case studies include an appealed decision to close a post

office in Idaho after the postmaster had been promoted, and a

nonappealed decision to close a post office in Nebraska after the death of

the postmaster.

Case Study 1: An

Appealed Decision to

Close the Post Office

in Clarkia, ID

In April 1993, the Postal Service promoted the postmaster at Clarkia, ID, a

community of approximately 60 residents, to another position. The

postmaster vacancy triggered a review of Clarkia’s postal needs by the

Service. After holding a community meeting and polling customers by

questionnaire, the Service made its decision, known as a Final

Determination, to close the Clarkia post office. The Service posted its

Final Determination at the Clarkia and three nearby post offices on

March 6, 1995.

The Service was to provide less costly alternative service in Clarkia via a

contractor-operated community post office (CPO). The CPO would offer the

same retail services as the post office, except that it would not accept

permit mail or set postage meters. The number of service hours would

remain the same—24 per week. By closing the post office and establishing

a CPO, the Service estimated that it would save $8,299 annually.

On April 3, 1995, Clarkia residents appealed the Service proposal to close

the Clarkia post office to PRC. PRC remanded the proposal to the Service

because it found that the administrative record was incomplete and failed

to adequately address all of the residents’ concerns. Specifically, the

administrative record did not include copies of the initial questionnaire

sent to customers and an analysis of the responses.

On October 28, 1995, the Service issued a revised Final Determination for

Clarkia and posted it at the post office from October 28 to November 27,

1995. Residents again appealed that determination to PRC on November 24,

1995. On March 21, 1996, PRC affirmed the Service’s decision. The Service

officially closed the post office by publishing a notice to that effect in the

Postal Bulletin of September 12, 1996.

Case Study 2: A

Nonappealed Decision

to Close the Post

Office in Octavia, NE

The postmaster at Octavia, NE, a community of 132, died on November 16,

1994. Pending a review of the postal needs of the community, the Postal

Service continued to provide postal service at the post office by using a

temporary clerk from another post office. After holding a community

meeting and polling customers by questionnaire, the Service posted its

Page 38 GAO/GGD-97-38BR Post Office Closures
Appendix I 

Two Case Studies Involving Appealed and

Nonappealed Proposals to Close Post

Offices

Final Determination, proposing to close the post office on December 28,

1995.

The Service proposed to provide delivery and retail services to Octavia via

rural route administered from a nearby post office. By closing the post

office and providing the alternative rural route service, the Service

estimated that it would save $13,019 annually.

No one appealed the Service’s decision to close the post office during the

30-day appeal period following the Service’s posting of the proposal.

Subsequently, the Service officially closed the Octavia post office by

publishing notice to that effect in the Postal Bulletin of September 12,

1996.

Page 39 GAO/GGD-97-38BR Post Office Closures
Appendix II 

Post Office Closures and Proposed Closures

Appealed, Fiscal Years 1995-96

The following table shows the post office closures—appealed and

nonappealed—that we reviewed for fiscal years 1995-1996. At the time of

our review, all 50 of the proposed closures that were not appealed had

been closed, along with 19 of the appealed closures.

Post office Closed Appealed Post office Closed Appealed

Alcock, KY x Moriah, NY x

Austinville, IA x Morrill, KY x

Benedict, MN x x Morrison, IA x

Bingham, NM x New Almelo, KS x

Boggs, WV x Numa, IA x x

Bovina Center, NY x Oak, NE x x

Bruington, VA x Octavia, NE x

Burkhart, KY x Oil Center, NM x

Burr, NE x x Oquossoc, ME x

Cauthornville,VA x Oven Fork, KY x

Clarkia, IDa x x Pearson, WI x

Colburn, IN x Plank, KY x

Cotesfield, NE x x Prosser, NE x x

Cottle, KY x Regina, VA x

Culver, MN x Rodman, IA x x

Cundiff, KY x Roscoe, MN x

DeGraff, MN x x Rowletts, KY x x

Eagle Harbor, NY x Salem, NE x

Eckhart Mines, MD x Sargentville, ME x

Erwin, SD x x Saum, MN x

Estill, KY x Sedan, MN x

Filer City, MI x Shade, OH x x

Forest Grove, MT x Shiloh, VA x

Frazer, KY x Silver Star, MT x

Garrattsville, NY x So. Westerlo, NY x x

Gypsy, KY x Sodus Center, NY x

Harlan, KS x Spring Lick, KY x

Haynesville, ME x St. Joseph, KY x

Hazelgreen, WV x Strang, NE x x

Hetland, SD x Taintor, IA x x

Hightown, VA x Tanner, WV x

Hubbell, NE x Tapoco, NC x

Huntley, NE x Thousand Island Park, NY x

(continued)

Page 40 GAO/GGD-97-38BR Post Office Closures
Appendix II 

Post Office Closures and Proposed Closures

Appealed, Fiscal Years 1995-96

Post office Closed Appealed Post office Closed Appealed

Kemp, OK x Toronto, IA x x

Kinross, IA x Trevett, ME x

Lakeview, CA x Trio, SC x

Lamb, KY x Twin Brooks, SD x

Lamero, KY x Valley Home, CA x x

Leith, ND x Walnut Grove, KY x

Lewiston, NE x Walters, MN x

Lynch, MD x x Welty, OK x

Macon, VA x West Rushville, OH x

Manchester, WI x x Westervelt, IL x

Maryneal, TX x Weston, MI x

Max, MN x Whitfield, MS x

Millbrook, MI x Wind Cave, KY x

Mira, LA x

aThis proposed closure was appealed twice.

Source: Postal Service and PRC data.

Page 41 GAO/GGD-97-38BR Post Office Closures
Appendix III 

Comments From the United States Postal

Service

Page 42 GAO/GGD-97-38BR Post Office Closures
Appendix IV 

Comments From the Postal Rate

Commission

Page 43 GAO/GGD-97-38BR Post Office Closures
Appendix V 

Major Contributors to This Report

General Government

Division, Washington,

D.C.

Gerald P. Barnes, Assistant Director

James T. Campbell, Assistant Director (retired)

Dallas Regional Office Sherrill Johnson, Assistant Director

Raimondo Occhipinti, Senior Evaluator

David Bennett, Evaluator

(240244) Page 44 GAO/GGD-97-38BR Post Office Closures
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