The U.S. Postal Service: Common Questions About Post Office Closures
Released: 2013-05-29T00:00:00

What Is a Post Office?

Colloquially, the term "post office" often is employed to refer to any place where stamps are sold and postal services are provided by USPS employees. Post offices, branches, stations, community and contract post offices all offer to the public a range of postal services. They are where many individuals go to buy stamps and ship packages.

The USPS, however, administratively differentiates the types of retail postal facilities that conduct these same activities:

main post office—The basic organizational unit of the USPS. Generally, each post office has primary responsibility for collection, delivery, and retail operations in a specific geographic area. [Also called "post office."] post office branch—A unit of a main post office that is outside the corporate limits of the city or town of the main post office. [Also called "classified branch."] post office station—A unit of a main post office that is within the corporate limits of the city or town of the main post office. [Also called "classified station."]

Each post office is managed by a postmaster; post office branches and stations are not. Branches and stations instead have managers who are under the direction of postmasters.

The USPS also provides postal services to customers through privately operated facilities:

contract postal unit—A postal unit that is a subordinate unit within the service area of a main post office. It is usually located in a store or place of business and is operated by a contractor who accepts mail from the public, sells postage and supplies, and provides selected special services (for example, postal money order or registered mail). community post office—A contract postal unit that provides service in a community where an independent post office has been discontinued. [It] bears its community's name and ZIP Code as part of a recognized address.

Herein, the term "USPS retail postal facilities" will encompass all five of the aforementioned postal facilities—post offices, post office branches, post office stations, community post offices, and contract postal units.

How Many Post Offices Are There?

The USPS's annual reports contain tabulations of the number of USPS retail postal facilities in existence at the end of each fiscal year. Figure 1 presents data on the number of facilities from FY1971 through FY2012. Over time, the USPS has altered the terms used to refer to some of these facilities. Additionally, the USPS has disaggregated post office branches from post office stations only since FY2004. Hence, Figure 1 and Table 1 present the retail postal facilities data as compiled into three categories: post offices (POs), post office branches and stations (POBs and POSs), and community post offices and contract postal units (CPOs and CPUs).

Figure 1 and Table 1 indicate that the total number of USPS retail postal facilities has declined steadily. In FY1971, the USPS had 42,287 retail facilities; in FY2012 it had 34,784—17.7% fewer. The number of POs has dropped 16.3%, and the number of CPUs and CPOs has declined 45.4%. Meanwhile, the number of POBs and POSs has increased 15.6%.

How Many Post Offices Might the USPS Close?

It is unclear how many retail postal facilities the USPS intends to close in the coming years. This uncertainty is the product of shifting USPS plans in recent years. The agency also has not stated how many post offices it needs to serve the public.

(1) In May 2009, the USPS announced it planned to shutter up to 3,105 retail facilities. How many of these post office stations and branches ultimately were closed as part of this initiative is unknown.

(2) In July 2011, the USPS declared that it might close 3,652 post offices, which would have amounted to approximately 10.2% of its then 35,633 retail facilities. The agency reported that that these included

2,825 post offices, each of which earned less than $27,500 in revenue annually; 384 post office stations and branches, each of which earned FY2010 revenue of less than $600,000; 178 "retail annexes," each of which earned FY2010 revenues of less than $1,000,000; and 265 post offices, stations, and branches that were undergoing discontinuance review already.

The USPS claimed that closing all these facilities could save more than $200 million per year.

At the time, the USPS said that some of these retail facilities could be closed or replaced by "village post offices." A village post office is a term coined by the USPS to refer to an arrangement substantially similar to a contract postal unit. Staffed by a non-USPS employee and located within a private retail outlet, a village post office would provide the following services: mail collection boxes, post offices boxes, stamp sales, and prepaid Priority Mail flat rate boxes and envelope sales and receipt. As proposed, a village post office would not provide other services, such as passport registration, money orders, and non-uniform parcel shipping. The provision of USPS products and services by private vendors is not unusual. Currently, the USPS has more than 64,000 third-party postal retail locations. The USPS views village post offices and other contractual arrangements as less expensive than operating a post office. However, in December 2011 the USPS announced that it had suspended its post office closures until May 15, 2012 "in response to a request made by multiple U.S. Senators."

(3) On May 9, 2012, the USPS announced that it would attempt to preserve small rural post offices by reducing the hours they are kept open and shrinking their cohort of postmasters. Some 13,000 post offices' hours of service would be reviewed and possibly reduced under the agency's "Post Office Structure Plan" (POStPlan). The PRC issued an advisory opinion on this latest initiative, finding it not contrary to law and preferable to the agency's previous proposal for post office closures. The American Postal Workers Union, which represents some of the USPS employees who may be affected by the POStPlan, has criticized it as violating its collective bargaining agreement with the USPS. The APWU and USPS are reportedly arbitrating this matter. The USPS has stated that the POStPlan will be fully implemented by September 2014. The USPS's communications on the POStPlan did not clarify whether it had discontinued the 2009 and 2011 retail closure initiatives. Nor did the agency state which of the postal facilities on the 2009 and 2011 lists have been shuttered or might be shut down. According to the data used to create Figure 1 , the number of retail postal facilities has decreased by 1,281 between FY2008 and FY2012 (31.3%), from 36,065 to 34,784.

What Authority Does the USPS Have to Close Post Offices?

The USPS was established in 1971 by the Postal Reorganization Act (PRA; P.L. 91-375; 84 Stat. 725). Previously, postal services had been provided by the U.S. Post Office Department (USPOD), a government agency that received annual appropriations from Congress. Members were involved in many aspects of the USPOD's operations, including the selection of managers (e.g., postmasters) and the pricing of postal services. Under this configuration, the Post Office had operational difficulties and developed a reputation for incompetence and corruption.

The PRA abolished USPOD and replaced it with the U.S. Postal Service, an "independent establishment of the executive branch" (39 U.S.C. 201). The USPS is a marketized government agency that has far greater freedom to run its operations than the former Post Office Department. It does not rely on appropriations for its operating revenue.

Congress assigned the USPS the "general duty" to "maintain an efficient system of collection, sorting, and delivery of the mail nationwide" (39 U.S.C. 403(b)). In order to carry out this obligation, the law gives the USPS the "specific powers" to

"provide for the collection, handling, transportation, delivery, forwarding, returning, and holding of mail, and for the disposition of undeliverable mail" (39 U.S.C. 404(a)(1)); and "determine the need for post offices, postal and training facilities and equipment, and ... provide such offices, facilities, and equipment as it determines are needed" (39 U.S.C. 404(a)(13)).

While Congress designed the USPS to be a self-supporting entity, the nation's legislature also requires the USPS to serve the public as a whole. This "public service obligation," as it often is termed, is located in the PRA's chapters on "postal policy" (39 U.S.C. 101) and the USPS's "general authority" (39 U.S.C. 403):

"The United States Postal Service shall be operated as a basic and fundamental service provided to the people by the Government of the United States, authorized by the Constitution, created by [an] Act of Congress, and supported by the people. The Postal Service shall have as its basic function the obligation to provide postal services to bind the Nation together through the personal, educational, literary, and business correspondence of the people. It shall provide prompt, reliable, and efficient services to patrons in all areas and shall render postal services to all communities" (39 U.S.C. 101(a)); and "The Postal Service shall provide a maximum degree of effective and regular postal services to rural areas, communities, and small towns where post offices are not self-sustaining. No small post office shall be closed solely for operating at a deficit, it being the specific intent of the Congress that effective postal services be insured to residents of both urban and rural communities" (39 U.S.C. 101(b)).

Congress also assigned the USPS the general duties to

"receive, transmit, and deliver throughout the United States, its territories and possessions ... written and printed matter, parcels, and like materials and provide such other services incidental thereto as it finds appropriate to its functions and in the public interest... (39 U.S.C. 403(a))"; and "establish and maintain postal facilities of such character and in such locations, that postal patrons throughout the Nation will, consistent with reasonable economies of postal operations, have ready access to essential postal services" (39 U.S.C. 403(b)).

Additionally, Congress has underscored the USPS's duty to serve less densely populated areas by including a provision in annual appropriation laws that reads, "none of the funds provided in this Act shall be used to consolidate or close small rural and other small post offices in [this] fiscal year."

What Is the Post Office Closure Process?

Federal postal law sets forth the basic rules by which the USPS may proceed to close a post office. The USPS must "provide adequate notice of its intention to close or consolidate such post office at least 60 days prior to the proposed date of such closing or consolidation to persons served by such post office to ensure that such persons will have an opportunity to present their views" (39 U.S.C. 404(d)(1)).

In deciding whether to close a post office, the USPS must consider

(i) the effect of such closing or consolidation on the community served by such post office;

(ii) the effect of such closing or consolidation on employees of the Postal Service employed at such office;

(iii) whether such closing or consolidation is consistent with the policy of the Government ... that the Postal Service shall provide a maximum degree of effective and regular postal services to rural areas, communities, and small towns where post offices are not self-sustaining;

(iv) the economic savings to the Postal Service resulting from such closing or consolidation; and

(v) such other factors as the Postal Service determines are necessary (39 U.S.C. 404(d)(2)(A)).

If the USPS decides to move forward with the closure, it must notify the persons served by the post office of its decision and the findings used to arrive at this decision. The USPS must wait at least 60 more days before proceeding with the closure, and any person served by the post office slated for closure may appeal the closure to the PRC, which has up to 120 days to consider the appeal. The USPS is not required to wait for the PRC to issue its opinion. It may close a retail facility 60 days after it makes its closure announcement.

The PRC may fault the USPS's decision to close a post office only if the PRC finds the decision to be "(A) arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with the law; (B) without observance of procedure required by law; or (C) unsupported by substantial evidence on the record" (39 U.S.C. 404(d)(5)). The PRC may require the USPS to reconsider its decision, but the ultimate authority to close a post office rests with the USPS.

The USPS long has had a separate "emergency suspension" process that it may employ to immediately cease service at a retail facility without following the aforementioned closure process. The USPS has been criticized for using it in situations that were foreseeable and perhaps not emergencies, and for failing to re-open these facilities. Under the most recently adopted post office closure rules, the USPS may close a post office immediately "due to cancellation of a lease or rental agreement when no suitable alternate quarters are available in the community, a fire or natural disaster, irreparable damage when no suitable alternate quarters are available in the community, challenge to the sanctity of the mail, or similar reasons."

What Is the Role of the Postal Regulatory Commission in Post Office Closures?

As noted in the previous section of this report, a member of the public may appeal a post office closure to the PRC. The current USPS's post office closure regulations continue the USPS's long-standing position that it will participate in appeals only if the facility closed is a post office (as opposed to a post office branch or station). The PRC may fault the USPS's decision to close a post office only if the PRC finds the decision to be "(A) arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with the law; (B) without observance of procedure required by law; or (C) unsupported by substantial evidence on the record" (39 U.S.C. 404(d)(5)). The PRC may require the USPS to reconsider its decision, but the ultimate authority to close a post office rests with the USPS.

Federal statute also provides another instance in which the PRC may play a role in the closure process. 39 U.S.C. 3661(b) requires the USPS to obtain an advisory opinion from the PRC when the USPS "determines that there should be a change in the nature of postal services which will generally affect service on a nationwide or substantially nationwide basis."

Hence, the USPS submitted its 2009 and 2011 post office closure proposals and its 2012 POStPlan to the PRC for advisory opinions. Again, the USPS is not bound by a PRC advisory opinion, and 90 days after submitting a proposal the USPS may begin executing it.

How Many USPS Employees May Lose Their Jobs?

In making its various post office closure announcements, the USPS did not indicate whether any employees would lose their positions. One 2011 media report quoted the USPS as saying 4,500 employees would be affected by the closures, but did not clarify how many would lose their positions. Most postal clerks, those who work at post office counters, and letter carriers are protected from layoffs through collective bargaining agreements. However, postmasters and other managers are not covered by collective bargaining agreements.

The USPS's May 2012 announcement concerning its rural post office preservation effort provided no estimate of the number of possible job eliminations. Approximately 21,000 postmasters may be offered retirement and early retirement incentives, although it is unclear how many will accept the USPS's offer.

Recent Legislation

113th Congress

At the time of the publication of this report, three bills with post office closure related provisions had been introduced into the 113 th Congress— H.R. 630 , H.R. 1016 , and S. 316 .

H.R. 630

Representative Peter A. DeFazio introduced H.R. 630 , the Postal Service Protection Act of 2013, on February 13, 2013. The bill was referred to the Committee on Oversight and Government Reform.

H.R. 630 would amend 39 U.S.C. 404(d) to reduce the USPS's authority to close retail postal facilities. The legislation would

make the statutory closure rules applicable to all USPS-operated facilities that serve the public directly; require the USPS to notify by mail each customer served by a facility in the event that the USPS should wish to consider closing it; expand the current statutory public comment period from 60 to 90 days; require the USPS to explain publicly its analysis of the estimated effects of a closure; empower the PRC to forbid the closure of a post office after conducting a review by request of an affected member of the public; disallow the USPS to use an expedited emergency closure process in the instance of a lease termination or cancellation; and direct the USPSOIG to report on whether a retail postal facility closure produced the savings the USPS had estimated.

H.R. 1016

Representative Scott H. Peters introduced H.R. 1016 , the Community Post Office Relocation Act, on March 6, 2013. The bill was referred to the Committee on Oversight and Government Reform.

H.R. 1016 includes provisions to amend 39 U.S.C. 4 (which contains the USPS's general authorities) to include a new section that would alter the USPS's authority to sell post offices. In the event that the USPS wishes to relocate the operations out of a post office, H.R. 1016 would

permit eligible not-for-profit (501(c)(3)) organizations to submit bids for the building "at fair market value"; require the USPS to "enter into negotiations for the sale of such building with the eligible buyer that submits the first offer, as determined by postmark date, during such 30-day period. If such negotiations fail, then the Postal Service shall enter into negotiations for sale with each subsequent eligible buyer, as determined by postmark date, that submits an offer during such 30-day period until a sale is made or until all such eligible buyers are exhausted"; and provide the USPS with the "right of first refusal" in the event the eligible buyer subsequently decides to sell the property.

The property disposition changes proposed by H.R. 1016 would occur subsequent to the post office closure process set by 39 U.S.C. 404(d). Whether H.R. 1016 's proposed disposition provisions would affect the USPS's decision-making during the post office closure process is unclear.

S. 316

Senator Bernard Sanders introduced S. 316 , the Postal Service Protection Act of 2013, on February 13, 2013. The bill was referred to the Senate Homeland Security and Governmental Affairs Committee.

S. 316 and H.R. 630 are identical bills. As with H.R. 630 , S. 316 's post office closure provisions may be found in Sections 201 and 202.

112th Congress

In the 112 th Congress, more than two dozen bills carried provisions related to the USPS's post offices and retail service to the public. The bills varied in their approaches to altering the post office closure, and H.R. 2309 , H.R. 2692 , S. 1668 , and S. 1789 illustrate this diversity. None of these bills became law.

H.R. 2309

Representative Darrell Issa introduced H.R. 2309 , the Postal Reform Act of 2011, on June 23, 2011. H.R. 2309 was amended and reported by the Committee on Oversight and Government Reform (which Representative Issa chairs) and the Committee on Rules on and January 17, 2012, and March 29, 2012, respectively.

H.R. 2309 included provisions to

amend 39 U.S.C. to establish a Commission on Postal Reorganization (CPR), an entity similar to the base realignment commissions (BRAC) that have been used to reduce the number of military bases. With the assistance of the USPS and USPS Inspector General, the CPR would prepare recommendations to reduce both the USPS's networks of post offices and non-retail facilities so as to save $2 billion within two years of the adoption of said recommendations. Congress may pass a joint resolution of disapproval to prevent the closure recommendations from being executed. H.R. 2309 would cap the number of small rural post offices that may be closed at 10% of the total number of post offices closed; strike language from 39 U.S.C. 101(b) to increase the USPS's authority to close post offices: "The Postal Service shall provide a maximum degree of effective and regular postal services to rural areas, communities, and small towns where post offices are not self-sustaining"; and "No small post office shall be closed solely for operating at a deficit, it being the specific intent of the Congress that effective postal services be insured to residents of both urban and rural communities."; amend 39 U.S.C. 404(d), which sets forth the process for the USPS to follow when it closes post offices, to conform to the amendment of 39 U.S.C. 101(b); and amend 39 U.S.C. 404(d) to disallow the public to appeal a post office closure if a contract post office is located within two miles of the post office closed.

H.R. 2692

Representative Albio Sires introduced H.R. 2692 , the Access to Postal Services Act, on July 28, 2011. H.R. 2692 was referred to the Committee on Oversight and Government Reform.

H.R. 2692 included provisions to

amend 39 U.S.C. 404 to define the term "post office" to include main post offices, post office branches, post office stations, and other USPS-operated retail outlets; amend 39 U.S.C. 404(d)(1) to require the USPS to notify affected members of the public of a proposed post office closure through mail and newspaper notices; strike language at 39 U.S.C. 404(d)(2)(a)(4)-(5) permitting the USPS to consider the cost savings in its consideration of the possible closure of a post office; amend 39 U.S.C. 404(d) to include a new provision that would forbid the USPS from avoiding the closure process prescribed by 39 U.S.C. 404(d) by declaring an emergency closure in the event of a "termination or cancellation of the lease by a party other than the Postal Service"; and amend 39 U.S.C. 404(d) to include a new provision that would require the USPS Inspector General not later than two years after a post office closure to assess the actual savings achieved as compared to those estimated by the USPS prior to the closure.

S. 1668

Senator Jeff Merkley introduced S. 1668 , the Protecting Rural Post Offices Act of 2011, on October 6, 2011. S. 1668 was referred to the Committee on Homeland Security and Governmental Affairs.

The bill would have amended 39 U.S.C. 404(d) to prohibit the USPS from closing a post office should it result "in more than 10 miles distance (as measured on roads with year-round access) between any 2 post offices." The bill did not define the term "post office." So it is unclear if it was intended to apply to post office branches, stations, and other retail facilities.

S. 1789

Senator Joseph Lieberman introduced S. 1789 , the 21 st Century Postal Service Act of 2012, on November 2, 2011. The Committee on Homeland Security and Governmental Affairs amended and reported S. 1789 on January 31, 2012, and the Senate further amended and passed S. 1789 on April 25, 2012.

S. 1789 would have amended 39 U.S.C. 404(d) to require the USPS to

examine additional factors in the course of rendering a post office closure decision, including "the effect of such closing or consolidation on the community served by such post office"; consider additional options other than closure when considering closing a post office, including operating the post office for reduced hours; notify "the chief executive of each State whose residents are served by such post office," who shall appoint a "citizens service protection advocate" to "represent the interests of postal customers affected by the closing or consolidation"; and notify the state board of elections, and the local board of elections.

S. 1789 also included provision to

forbid the USPS from closing any post office should it produce a reduction of retail service beneath the retail service standards; and prohibit any post office closures until the USPS establishes "retail service standards"; prohibit any rural post office closures during the 12 months following enactment of S. 1789 ; prohibit any post office closures prior to November 13, 2012, in any state "that conducts all elections by mail or permits no-excuse absentee voting"; and forbid the USPS from closing a rural post office should the closure have negative effects on the community, such as "substantial financial losses" to any business in the community, or a reduction in access to "essential items, such as prescription medications and time-sensitive communications, that are sent through the mail."