U.S. Postal Service: Challenges to Sustaining Performance Improvements
Remain Formidable on the Brink of the 21st Century (Testimony,
10/21/1999, GAO/T-GGD-00-2).

Pursuant to a congressional request, GAO discussed the U.S. Postal
Service's (USPS) financial position and delivery performance.

GAO noted that: (1) USPS may be nearing the end of an era; (2) during
the past 5 years, USPS has made notable improvements in its financial
position and delivery performance; (3) USPS has recorded positive net
income and has maintained or improved the overall delivery of certain
specific classes of mail; (4) however, USPS expects declines in its core
business in the coming years; (5) the growth of the Internet, electronic
communications, and electronic commerce has the potential to
substantially affect USPS' mail volume; (6) as a result, USPS may
experience growing difficulty in maintaining its position in a dynamic
communications and delivery environment; (7) these developments make it
imperative for USPS to resolve four long-standing performance challenges
which include: (a) maximizing performance; (b) managing employees; (c)
maintaining financial viability; and (d) adapting to competition; (8)
GAO is highlighting the need for USPS to take action to address
long-standing issues related to the quality of data used in ratemaking
and recommending that the Postmaster General report to congressional
oversight subcommittees on the actions taken and planned in this area;
(9) in recent years, USPS has progressed in addressing various
challenges and is continuing to initiate significant changes that
respond to the challenges; and (10) however, as long as USPS stands on
the brink of the twenty first century, time appears to be growing short
for USPS to successfully address its challenges so that it can sustain
and improve current performance levels and remain competitive in a
rapidly changing communications environment.

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  T-GGD-00-2
     TITLE:  U.S. Postal Service: Challenges to Sustaining Performance
	     Improvements Remain Formidable on the Brink of the
	     21st Century
      DATE:  10/21/1999
   SUBJECT:  Performance measures
	     Strategic planning
	     Competition
	     Agency missions
	     Postal service
	     Postal service employees
	     Postal rates
	     Financial management
	     Personnel management
	     Industrial relations
IDENTIFIER:  USPS Integrated Financial Plan

******************************************************************
** This file contains an ASCII representation of the text of a  **
** GAO report.  Delineations within the text indicating chapter **
** titles, headings, and bullets are preserved.                 **
**                                                              **
** No attempt has been made to display graphic images, although **
** figure captions are reproduced.  Tables are included, but    **
** may not resemble those in the printed version.               **
**                                                              **
** Please see the PDF (Portable Document Format) file, when     **
** available, for a complete electronic file of the printed     **
** document's contents.                                         **
**                                                              **
** A printed copy of this report may be obtained from the GAO   **
** Document Distribution Center.  For further details, please   **
** send an e-mail message to:                                   **
**                                                              **
**                                            **
**                                                              **
** with the message 'info' in the body.                         **
******************************************************************

United States General Accounting Office
GAO

Testimony

Before the Subcommittee on the Postal Service
Committee on Government Reform
House of Representatives

Not to be Released
Before
10:00 a.m. EDT
Thursday
October 21, 1999
GAO/T-GGD-00-2

U.S. POSTAL SERVICE
Challenges to Sustaining

Performance Improvements Remain Formidable on

the Brink of the 21st Century

Statement by Bernard L. Ungar
Director, Government Business Operations Issues
General Government Division

Ordering Information

The first copy of each GAO report and testimony
is free. Additional copies are $2 each. Orders
should be sent to the following address,
accompanied by a check or money order made out
to the Superintendent of Documents, when
necessary. VISA and MasterCard credit cards are
accepted, also. Orders for 100 or more copies to
be mailed to a single address are discounted 25
percent.

Order by mail:

U.S. General Accounting Office
P.O. Box 37050
Washington, DC 20013

or visit:

Room 1100
700 4th St. NW (corner of 4th and G Sts. NW)
U.S. General Accounting Office
Washington, DC

Orders may also be placed by calling (202) 512-
6000 or by using fax number (202) 512-6061, or
TDD (202) 512-2537.

Each day, GAO issues a list of newly available
reports and testimony. To receive facsimile
copies of the daily list or any list from the
past 30 days, please call (202) 512-6000 using a
touch-tone phone. A recorded menu will provide
information on how to obtain these lists.

For information on how to access GAO reports on
the INTERNET, send e-mail message with "info" in
the body to:

[email protected]

or visit GAO's World Wide Web Home Page at:

http://www.gao.gov

United States
General Accounting Office
Washington, D.C. 20548-0001
Official Business
Penalty for Private Use $300
Address Correction Requested

                    Bulk Rate
               Postage & Fees Paid
                       GAO
                 Permit No. G100

(240367)

U.S. Postal Service: Challenges to Sustaining
Performance Improvements Remain Formidable on the
Brink of the 21st Century
Page 1                             GAO/T-GGD-00-2
     The Postal Service may be nearing the end of
an era.  During the past 5 years, the Service has
made notable improvements in its financial
position and delivery performance.  The Service
has recorded positive net income and has
maintained or improved the overall delivery of
certain specific classes of mail.  However, the
Service expects declines in its core business in
the coming years.  The growth of the Internet,
electronic communications, and electronic commerce
has the potential to substantially affect the
Service's mail volume.  As a result, the Service
may experience growing difficulty in maintaining
its position in a dynamic communications and
delivery environment.  These developments make it
imperative for the Service to resolve long-
standing performance challenges, which involve
four major areas.

ï¿½    Maximize performance:  The Service's ability
to maximize performance in the face of increasing
customer demands and choices calls for
establishing processes to accurately assess
performance results and collecting and maintaining
reliable data to support such assessments.
ï¿½    Manage employees:  The Service's management
of employees, its greatest asset, will in large
part involve continued attention to labor-
management relations problems that have plagued
the Service and its unions and management
associations for several years.
ï¿½    Maintain financial viability:  The extent to
which the Service can maintain financial viability
by controlling costs and enhancing revenues will
involve appropriately managing its capital
investments in technology and infrastructure as
well as working to improve productivity.
ï¿½    Adapt to competition:  The means by which the
Service can adapt to a rapidly changing
communications environment of growing competition
will involve positioning the organization to meet
changing customer needs, improve performance, and
operate more efficiently.

GAO is also highlighting the need for the Postal
Service to take action to address long-standing
issues related to the quality of data used in
ratemaking and recommending that the Postmaster
General report to congressional oversight
subcommittees on the actions taken and planned in
this area.

In recent years, the Service has progressed in
addressing various challenges and is continuing to
initiate significant changes that respond to the
challenges.  However, as the Service stands on the
brink of the 21st century, time appears to be
growing short for the Service to successfully
address its challenges so that it can sustain and
improve current performance levels and remain
competitive in a rapidly changing communications
environment.

Statement
U.S. Postal Service:  Challenges to Sustaining
Performance Improvements Remain Formidable on the
Brink of the 21st Century
Page 3                             GAO/T-GGD-00-2
Mr. Chairman and Members of the Subcommittee:

We are pleased to be here today to participate in
the Subcommittee's oversight hearing on the U.S.
Postal Service.  In my testimony, I shall provide
an overview of where the Service stands today, as
we come to the end of the 20th century, by looking
back at trends in its financial and service
delivery performance and also looking forward to
the major challenges confronting the Service at
the start of a new millennium.  Also, I will
discuss ongoing work and work that we have
completed since June 1998 related to four major
challenges facing the Postal Service:

ï¿½    maximizing performance in the face of
 increasing customer demands and choices;
 
ï¿½    managing employees, the Service's most
valuable asset, to maximize attainment of agency
goals and continuous improvement of employee
performance;
ï¿½    maintaining financial viability by
controlling costs and enhancing revenues; and
ï¿½    positioning the organization to adapt to a
rapidly changing communications and delivery
environment with a growing number of competitors.
     I will also discuss other major postal
oversight issues related to work that we have
completed during the past year.  A list of the
reports and testimonies we have issued since June
1, 1998, is included in the attachment to this
statement.

Overview of Financial and Service Delivery
Performance
The Service has continued to report improvements
in the areas of financial and service delivery
performance and has undertaken a number of
initiatives to respond to the four major
challenges that we identified.  Given the nature
and extent of the challenges facing the Service,
we understand that it will take time to implement
and assess the impact of major initiatives
intended to address the challenges.  And, although
the Service has made progress and is continuing to
make significant changes, time appears to be
growing short for the Service to successfully
address these challenges so that it can sustain
and improve current performance levels and remain
competitive into the 21st century.

The Impact of Increasing Competition
The Service faces growing challenges from
competition, notably from private delivery
companies and electronic communications
alternatives such as the Internet.  The Service
projects that such competition will lead to
substantial declines in the Service's First-Class
Mail volume in the next decade.  Should this
occur, the Service will likely face unprecedented
challenges as it seeks to fulfill its primary
mission of providing universal postal service at
reasonable rates while remaining self-supporting
from postal revenues.

The Service and other stakeholders agree that
growth in the Service's core business of
delivering First-Class Mail has already been
affected by the rapid growth of the Internet,
electronic communications, and electronic
commerce.   Although the Service's mail volume
increased in the 1990s to record levels, the rate
of growth has slowed.  As figure 1 indicates, the
Service projects that First-Class Mail volume will
decline at an average annual rate of 0.8 percent
in fiscal years 1999 to 2008.  Specifically, First-
Class Mail is projected to grow at an average
annual rate of 1.8 percent in fiscal years 1999 to
2002-the projected peak-and then to decline at an
average annual rate of 2.5 percent in fiscal years
2003 to 2008.  Such a decline would be
unprecedented in the Service's history and would
likely create financial and performance
challenges.  As the Postmaster General has noted,
the Service's environment is changing rapidly, and
therefore the Service cannot predict precisely
when or to what extent competitive pressures may
affect the Service's revenues.

Figure 1:  U.S. Postal Service Projects Future
Decline in First-Class Mail Volume

Note 1:  The U.S. Postal Service forecasts First-
Class Mail to increase by an average annual rate
of 1.8 percent in fiscal years 1999 through 2002
and to decline by an average annual rate of 2.5
percent in fiscal years 2003 through 2008.  The
Service also forecasts Standard A mail to increase
by an average annual rate of 5.3 percent in fiscal
years 1999 through 2002 and to increase by an
average annual rate of 3.3 percent in fiscal years
2003 through 2008.
Note 2:  Actual data for fiscal year 1999 are not
yet available.  Standard A mail is primarily
advertising mail and includes letters, flats, and
parcels that are not sent by First-Class Mail or
Priority Mail.
Source: U.S. Postal Service.

Historically, increases in mail volume-including
the volume of First-Class Mail-have helped the
Service cover its costs.  In the 1990s, increasing
postage rates and mail volume helped provide the
Service with additional revenue to finance wage
increases, modernization efforts, and improvements
in the quality of delivery service.  The Service
projects that total mail volume will continue to
increase from fiscal years 2000 through 2008 by an
average annual rate of 1.7 percent, with the
growth rate tapering off during the decade and
total mail volume peaking in fiscal year 2006.

Even if total mail volume increases, a decline in
First-Class Mail volume would present the Service
with the challenge of making corresponding
reductions in the costs of handling First-Class
Mail-that is, in costs that historically have
varied directly or indirectly with changes in
First-Class Mail volume-in order to hold down
First-Class rates.  Further, in fiscal year 1998,
revenues from First-Class Mail covered about two-
thirds of the Service's institutional costs.1  A
substantial reduction in First-Class Mail volume
would reduce its contribution to institutional
costs, which could lead to somewhat higher postage
rates in the future.

The Service recently provided us with a detailed
explanation of its volume forecast scenario and
why it projects a substantial decline in First-
Class Mail in the next decade.  The Service's
Chief Financial Officer wrote us on September 9,
1999, that First-Class Mail volume is projected to
decline on the basis of the assumption that
diversion of mail to electronic communications
alternatives would accelerate in a new and vastly
different environment in which the Service would
operate.  In this environment, changes in
technology and business would create a climate in
which current hypotheses about mailing behavior
may no longer hold.   Notably, the combination of
consumer movement to alternative bill payment
methods and the consolidation in the financial
sector would reduce the number of bills,
statements, and payments in the mail stream.
Moreover, the movement of advertisers to the
Internet would cause a slowdown in the growth of
Standard A mail, while growth in Priority Mail and
Parcel Post would continue to be robust as
consumers embrace electronic commerce and more
packages are shipped by Internet retailers.
Specifically, the Service's forecast was based on
the following assumptions:

ï¿½    Potential Year 2000-related complications are
 largely avoided, increasing business and consumer
 confidence in electronic alternatives to
 traditional mail-based bill and statement streams.
 
ï¿½    Businesses increase research and development
and technology spending as a result of the easy
Year 2000 transition, resulting in rapid
implementation of on-line banking and financial
applications and the spread of Internet-based
small business Electronic Data Interchange.
ï¿½    First-Class letter advertising reaches a
saturation point because of consolidation in the
banking sector, as well as the diversion of bills
and payments away from the mail stream.
ï¿½    Advertisers move away from traditional media
to Internet-based platforms because of increased
consumer use of the Internet.
     Another key development has been the
globalization of the Service's competitors in the
delivery sector, which has contributed to recent
declines in the Service's international mail
volume.  Further, the Service's competitors have
charged that the Service is using its governmental
status to compete unfairly.  These developments
have fueled the debate over whether the Service
should be allowed to introduce new nonpostal
products in competition with the private sector,
or whether the Service should be limited to
offering traditional postal services and wind down
its operations as its core business declines.
Regardless of how this public policy debate is
resolved, the Service has recognized that it must
continue to meet customer needs, improve its
performance, and operate more efficiently in order
to be successful in an increasingly competitive
environment.

Financial and Delivery Performance Continues to
Show Positive Results
The Service projects positive results for both
financial and service performance for fiscal years
1999 and 2000.  As shown in figure 2, the Service
projects a net income of $200 million in fiscal
year 1999, and its Integrated Financial Plan for
fiscal year 2000 projects a net income of $100
million.

Figure 2:  Trends in Postal Service Net Income
Since Postal Reorganization Was Implemented

Source: U.S. Postal Service.

If the Service achieves these net income
projections, it will be the first time that the
Service has achieved positive net income for 6
consecutive years since postal reorganization was
implemented in 1971.  However, the Service's
Integrated Financial Plan for fiscal year 2000 has
reported that in order to accomplish net income of
$100 million in fiscal year 2000, the Service
would need to realize a 1-percent reduction in
workhours.  This plan projected that growth in
total mail volume will be 3.8 percent in fiscal
year 2000, which would add to the Service's
workload.  Also, according to Postal Service data,
the size of the Service's city and rural delivery
network has increased more than 1 percent in each
of the past 4 years.  If the Service's delivery
network continues to grow, this would further add
to the workload of mail delivery.  In addition,
the Service has established goals to maintain or
improve mail delivery service in fiscal year 2000.

The Postmaster General has stated that the Postal
Service is cutting costs to preserve affordable
rates but that service will not be sacrificed. As
shown in figure 3, during the 1990s, the Service
improved on-time delivery of First Class Mail that
is to be delivered overnight, as well as First-
Class Mail that is to be delivered 2 or 3 days
after it is mailed.  The Service also appears to
be on track for achieving record delivery service
performance for this year. The Service's
Performance Plan for fiscal year 2000 sets goals
to continue the improved performance in these
areas, as well as setting an additional
performance target for on-time delivery of
advertising mail.

Figure 3:  On-Time Delivery Performance for First-
Class Mail

Source: U.S. Postal Service.

Challenges Facing the Service
     We have identified four major challenges
facing the Postal Service as the 21st century
quickly approaches:  (1) maximizing performance in
the face of increasing customer demands and
choices, (2) managing employees-the Service's most
valuable asset-to maximize attainment of agency
goals and continuous improvement of employee
performance, (3) maintaining financial viability
by controlling costs and enhancing revenues, and
(4) adapting to a rapidly changing communications
and delivery environment with a growing number of
competitors.

Maximizing Performance
     One of the major and continuing challenges
that the Service faces involves its effort to
maximize performance in the face of increasing
customer demands and choices.  As part of this
effort, the Service has established a results-
oriented planning process.  As required by the
Government Performance and Results Act of 1993
(the Results Act), the Service has published
annual performance plans.  These plans were
aligned with its planning process and identified
the Service's major goals and objectives,
strategies for accomplishing the goals and
objectives, and some performance indicators to
measure progress toward these goals.

     The Service's performance plan should help
guide its actions over the next year and provide
information useful to the Service's ongoing
dialogue with Congress and other stakeholders.
The Preliminary Annual Performance Plan for Fiscal
Year 2000 specified goals and targets for the
Service's intended performance in such areas as
providing timely delivery, improving workplace
relations, and achieving its target for net
income.  In response to a report we issued in
April 1999, the Service agreed to identify its top
goals for fiscal year 2000 in its final
performance plan.2   Also, the final plan provided
updated information on the Service's projected
revenues and costs for fiscal year 2000 as well as
an updated summary of the Service's efforts to
reduce its costs.

     Early next year, the Service is to publish
its first annual program performance report under
the Results Act as part of its Fiscal Year 2000
Comprehensive Statement on Postal Operations.
This report should help the Service, Congress, and
other stakeholders assess the Service's
performance in the past fiscal year compared to
the goals included in its performance plan.  In
this regard, it will be important to many postal
stakeholders for the Service to continue to make
tangible progress toward implementing a more
complete set of performance measures and targets.
For example, in fiscal year 2000, the Service
intends to develop new measures of timely delivery
of international mail, publications, and bill
payments sent through the mail.  As we observed in
our January 1999 report on the Service's major
performance and management challenges, the
prospect of declines in the Service's core
business has heightened the need for the Service
to resolve long-standing performance issues and
implement reliable indicators of postal
performance.3

Ratemaking Data Quality
     To date, limited assessments have been made
of the reliability of the Service's performance
data.  Data integrity is vital to the Service's
performance report as well as other mission-
critical areas, such as setting postal rates.  One
study, which was initiated at the request of this
Subcommittee, established a good beginning by
assessing the quality of data used in postal
ratemaking and identifying opportunities to
improve the quality of these data.

     The study involved a joint 1997 agreement
among the Service, the Postal Rate Commission, and
us to have an outside contractor conduct a
comprehensive assessment of the quality of data
used by the Service in setting postal rates.  The
study, conducted by A.T. Kearney, Inc., resulted
in a report released earlier this year that
included 47 recommendations designed to improve
and enhance the completeness and the accuracy of
data the Service provides for ratemaking.4  The
contractor found that providing sufficiently
complete and accurate data is an evolutionary
process that requires the Service to continually
improve the quality of its ratemaking and related
data systems.  For example, changes in operations
require ongoing improvements to data systems to
ensure that appropriate data are collected.

The contractor concluded that the quality of the
data provided by the Service for ratemaking has
generally been sufficiently complete and accurate
to enable subclass rates to be based on reasonably
reliable data.  However, the contractor reported
concerns that in some instances, the best
available data were used regardless of their
inherent levels of error or obsolescence.  The
contractor concluded that ".improvements and
enhancements can--and must--be made to ensure
future data provided for rate making will be
sufficiently complete and accurate."  Some of the
key recommendations related to the following
areas:

ï¿½    Mail processing: better measure costs related
 to mail processing;
 
ï¿½    Delivery: update and improve the quality of
special study data used to determine delivery
costs;
ï¿½    Capital and support:  improve the measure of
capital and support costs; and
ï¿½    Revenue, volume, and weight: improve the
completeness and accuracy of mail revenue, volume,
and weight data as well as develop more accurate
analyses of the impact of weight on costs.
We believe that the study has made an important
contribution to analyzing the issues, making the
case for change, and offering constructive
recommendations for short-term and long-term
improvements.  Postal officials have indicated
that they agree with most of the study's
recommendations.  They said that the Service is
taking steps to implement some of the
recommendations, such as updating some special
studies used to help estimate postal costs.  For a
number of recommendations, they plan to conduct
additional evaluation or analysis to assess what
followup may be needed. Overall, it is not clear
what specific actions the Service plans to take to
improve the quality of data used in ratemaking and
the timeframes for completion.

As you know, Mr. Chairman, you requested this
study to address concerns raised by the Chairman
of the Postal Rate Commission and others about the
data deficiencies in the Postal Service's 1994
rate filing.  Further, issues related to the
quality of data used in ratemaking have been an
important area of continuing oversight for this
Subcommittee.  Given the importance of data
quality to setting postal rates, as well as the
level of congressional concern in this area, we
believe it is important for the Postal Service to
demonstrate to Congress, the Postal Rate
Commission, stakeholders, and the public that it
is making progress in improving the quality of
data used in ratemaking.  Therefore, we are
recommending that the Postmaster General report to
the congressional oversight subcommittees on the
actions taken and planned to improve the quality
of data used in ratemaking.

Managing Employees
     Management of its employees constitutes one
of the Service's major challenges in meeting goals
and maximizing performance.  The Service employs
nearly one-third of the federal civilian workforce
and is the single largest federal civilian agency.
To carry out its mission, the Service had a total
of about 900,000 career and noncareer employees as
of September 30, 1998.5  To operate effectively in
a rapidly changing environment, the Service has
recognized that it will need to give human capital
issues a higher priority and enhance each
employee's contributions to organizational
performance.  The Service's Year 2000 Performance
Plan states that its revised  Voice of the
Employee goal "elevates the quality of the overall
workplace environment from a subgoal category to a
corporate goal, and emphasizes that the end result
should achieve organizational and individual
success."

Labor-Management Relations
     We have previously reported on long-standing
problems in labor-management relations that have
affected the postal workplace environment.
Although the Service has continued to make
progress in improving its labor-management
relations, problems still exist that appear to
create barriers between the Service and its main
employee organizations, including four major
postal labor unions and three management
associations.  Such barriers have often stood in
the way of agreements being reached among the
eight organizations, including postal labor
unions' collective bargaining agreements, that
could help ensure the most effective management of
the Service's employees.  Also, disagreements have
prevented the establishment of an overall
framework agreement, which we recommended in our
1994 report on postal labor-management relations.6
Such an agreement could help the eight
organizations focus on common approaches for
addressing persistent labor-management relations
problems so that the Service's work environment
can be improved and its competitive position in a
dynamic communications market can be maintained.

     The Service has identified a number of goals
and strategies to improve its workplace relations
and to enhance various employee programs, such as
its diversity program.  However, full success of
these efforts is unlikely without a partnership
between postal managers and employees.  Without
such a partnership, difficulties in the postal
workplace are likely to persist and hamper the
Service's ability to best achieve its overall
performance goals.

     One area that has historically posed a
challenge to the Service and its unions and
management associations involves compensation and
benefits issues.   The most recent contract
negotiations occurred during the last year for
three of the four major postal labor unions whose
contracts expired in November 1998.7  Negotiations
for new contracts between the Service and two of
the three unions-the American Postal Workers Union
(APWU) and the National Postal Mail Handlers Union
(Mail Handlers)--produced settlements without the
use of arbitration.  However, for one of the three
unions-the National Association of Letter Carriers
(NALC)-interest arbitration involving a third-
party negotiator was used to settle contract
disputes regarding employee wages and benefits and
to reach an agreement last month.

     In recent months, concerns about compensation
and benefits for postmasters have also been raised
by members of two of the three management
associations, including the National Association
of Postmasters of the United States (NAPUS) and
the National League of Postmasters of the United
States (NLPM).8  Unlike the unions, management
associations, which generally represent the
interests of postal managers, supervisors, and
postmasters, may not collectively bargain for
contract employment terms.  However, the Service
is required by the Postal Reorganization Act of
1970 to consult with the management associations
on various issues that affect their members,
including compensation and benefits. We briefed
the Subcommittee earlier this year on the concerns
that had been raised by organizations representing
postmasters related to compensation issues. In
August 1999, these management associations reached
agreement with the Service on compensation
matters. However, these associations have
continuing concerns related to the extent of the
differential in pay between bargaining unit
employees and supervisory and managerial
employees.

     During the past year, our work related to
postal employees has focused mainly on issues
involving diversity and equal employment
opportunity (EEO) and employee safety and health.
I would like to briefly discuss the results of our
completed work and provide information about our
continuing work efforts in these areas.

Diversity and Equal Employment Opportunity
     One of the Service's many challenges
involving employees relates to the areas of
employee diversity and EEO.  In large part, our
completed work in these areas has generally
addressed the Service's efforts to achieve
specific diversity goals, such as the promotion of
women and minorities into higher postal management
levels, and the Service's tracking and monitoring
of specific data related to EEO complaints.

     Concerning the promotion of women and
minorities to higher management levels, we issued
two reports to Congressman Danny Davis, one in
September 1998,9 and one in February 1999.10  In
the September 1998 report, we discussed the
results of our work on the Service's compliance
with promotion procedures at three postal
locations.11  Specifically, we obtained and
analyzed various data to determine the extent to
which women and minorities were represented at the
higher Executive and Administrative Schedule (EAS)
management levels.  The results of our work showed
that for 117 promotions that were awarded in 3
postal locations, many of the applicants (62
percent) and those determined best qualified (64
percent) were women and minorities.  Also, of the
employees promoted to higher level management
positions in the three locations, about 62 percent
were women and minorities, compared with the 59
percent at the same grade levels in these
locations before the promotions took place.

     In addition, our February 1999 report to
Congressman Davis supplemented the September 1998
report by providing comprehensive data on the
extent to which women and minorities were
represented at higher postal management levels,
including promotion-related data.  The February
1999 report also included information on other
issues, such as (1) the lack of reliable EEO data
on promotion applicants' progress through the
promotion process and (2) the Service's progress
in responding to specific recommendations made in
1997 by Aguirre International-an outside firm that
reviewed the Service's diversity program-that were
intended to help the Service strengthen its
program.

     In the February 1999 report, we recommended
that the Postmaster General ensure that
appropriate Service officials capture and use EEO
group data to help improve the Service's diversity
program, including the identification of any
barriers that might impede promotions to high-
level EAS positions.  In response to our
recommendation, the Vice President for Human
Resources told us that she would emphasize to
postal field facilities the need to enter data
into the appropriate data system so that more
complete and reliable information about promotions
could be maintained and used as a tool to identify
the points that impede the promotions of
applicants to high-level EAS positions.

     Also, the results of some of our completed
work in the area of EEO complaints indicated that
shortcomings existed in the collection and
reporting of specific EEO-related data, such as
the bases for complaints and issues involved in
the complaints.  Without reliable information,
managers will not be able to determine how best to
address problems regarding the nature and extent
of conflict in the postal workplace or assess the
extent to which improvements can be made.

     In addition, as requested by Congressman
Chaka Fattah, the Subcommittee's Ranking Minority
Member, we are currently reviewing the Service's
progress in achieving a diverse workforce in its
Postal Career Executive Service (PCES), which
represents the Service's senior level officers and
executives.  We are working to obtain information
about diversity within PCES similar to the
information that we provided in our February 1999
report about diversity within the Service's high-
level EAS workforce.

Employee Safety and Health
     Another significant challenge the Service
faces is implementing the Postal Employees Safety
Enhancement Act.  Prior to the act, the Postal
Service was required to comply with Occupational
Safety and Health Administration (OSHA) safety and
health program requirements for federal agencies.
When OSHA found safety and health problems at
postal facilities, it issued notices of unsafe or
unhealthful working conditions, but it did not
issue citations or levy monetary penalties.
However, the act, which became effective on
September 28, 1998, required the Postal Service to
comply with OSHA requirements for private sector
employers.  Accordingly, OSHA may now impose
citations and monetary penalties on the Postal
Service for noncompliance.

     In converting from requirements for federal
agencies to provisions for private sector
employers, postal officials stated that they would
have to review and modify existing safety and
health policies, programs, procedures, systems,
training, and education programs, as well as
modify recordkeeping procedures for accident and
injury data.  The officials said that challenges
associated with implementing the requirements of
the act include (1) modifying existing automated
systems at the same time that government,
industry, and the Service are dedicating their
technical resources to ensure Year 2000
compliance; (2) developing and implementing
training programs on the judicial and other
processes that previously were not applicable to
the Postal Service for safety personnel, legal
staff, and key operations staff; and (3) modifying
the Service's financial system to track expenses
associated with implementing the new requirements.

Maintaining Financial Viability
     The Postal Service's ability to maintain
financial viability by controlling costs,
improving productivity, and enhancing revenues
also presents a continuing challenge.  The
Service's strategic plan stated that aggressive
cost management would be necessary to guarantee
success in mitigating historic cost trends that
drive price increases.  The Service's Annual
Performance Plan for Fiscal Year 2000 established
goals for controlling costs through cost reduction
programs as well as by achieving productivity
gains.  The plan also reported that it is not
unusual for the Service's productivity to
fluctuate from one year to another, but over the
long run a successful organization will achieve
positive growth in productivity.  Further, the
Service has recognized that it must have strong
and effective internal operating controls to avoid
unwarranted costs and protect its revenues.

Controlling Costs
     Effective management of the Service's capital
investments is critical if the Service is to
achieve its projected return on investments.   The
Service reported that it has made aggressive
capital investments in technology and
infrastructure to improve the distribution and
delivery of mail as well as reduce labor costs.

     In September 1998, the Postal Service Board
of Governors confirmed the Service's plan to spend
$17 billion through fiscal year 2002 on capital
investments that are intended to automate and
modernize operations and control costs.  The
Service has reported in the past that it intends
to substitute capital for labor to help it achieve
its financial goals.  As shown in figure 4, labor-
related expenses accounted for more than 80
percent of the Service's total expenses in each of
the past 3 decades. The Service's labor-related
expenses declined somewhat during the 1990s but
continued to represent 79 percent of the Service's
expenses in fiscal year 1998, the most recent year
for which data are available.

Figure 4:  Labor-Related Expenses Accounted for
Most of the Postal Service's Total Expenses

Note: Labor-related expenses include such costs as
employee compensation and benefits, retroactive
assessments for employee benefits, imputed
interest expenses on retroactive assessments for
employee benefits, interest expenses on deferred
retirement liabilities, and workers' compensation
expenses of the former Post Office Department.
Percentages shown were compiled by dividing the
Postal Service's total labor-related expenses for
each period by the Service's total expenses for
that period.  Data for fiscal year 1999 are not
yet available.
Source: U.S. Postal Service annual reports.

     The Service stated in its Five-Year Strategic
Plan for fiscal years 1998 through 2002 that the
cost paid for labor resources is the primary
driver of Postal Service prices, and that
significant revenue growth must be matched by
aggressive cost management for the Service to
mitigate historic cost trends that drive price
increases.  Further, the Service has recognized
that its stakeholders are also demanding
aggressive cost management.

     As mentioned earlier, although the Service
has improved its delivery performance in some
areas, questions remain about whether the Service
is adequately realizing the anticipated savings
from its capital investments.  Last year, the
Board of Governors approved a capital investment
budget of $4.4 billion for fiscal year 1999, of
which the largest component--$1.7 billion--was
committed to facility projects, and $1.5 billion
was committed to equipment projects.  Last year,
we reported to the Subcommittee on the Service's
shortfalls in reaching its projected carrier
workhour savings from its investments in automated
sorting equipment.12

Improving Productivity
     The Service has reported that its Integrated
Financial plan for Fiscal Year 2000 relies on
"aggressive productivity improvement" in order for
the Service to meet its "challenging bottom-line
target" of $100 million in net income.  The
Service's performance plan for fiscal year 2000
set a target of increasing total factor
productivity (TFP) by 3.1 percent. 13  To put this
challenge into context, figure 5 indicates that
TFP increased at least 3 percent in only 4 years
since postal reorganization was implemented (1973,
1978, 1990, and 1993).

Figure 5:  Growth in Postal Service Productivity

Note: Data for fiscal year 1999 are not yet
available.
Source: U.S. Postal Service.

     In addition, TFP declined in 4 of the last 5
years for a cumulative decline of about 3 percent.
The Service reported that the TFP decline in 1998,
the most recent year for which data are available,
was linked to an increase in its capital
investments and the conversion of many
transitional employees to career status.  The
Service reported that it expects to realize
deferred benefits from automation that should help
increase its productivity in the future.

     The Service has reported that its aggressive
capital investments, though consistent with its
long-term strategy of substituting capital for
labor, may have a short-term negative impact on
TFP due to implementation costs and the difference
between the timing of costs and the realization of
savings.  The Service's plan for $4.0 billion in
capital commitments14 in fiscal year 2000-compared
with $3.9 billion in capital commitments in fiscal
year 1998 when TFP declined by 1.1 percent-points
to the challenge of increasing TFP by the target
of 3.1 percent in fiscal year 2000. Moreover, the
Service has reported that some investments improve
service but do not improve TFP.

     The Service has cautioned that TFP is best
used to analyze long-term trends and is not
effective as a short-term measure or snapshot in
time.  In this regard, as figure 5 shows, TFP
increased 9.1 percent from the time that postal
reorganization was implemented to fiscal year
1998.  The Service has recently reported that its
objective is to improve TFP over time while
maintaining a balance with the service
improvements necessary to achieve customer
satisfaction and maintain a competitive position
in the marketplace.

Enhancing Revenues
     Another key area of the Service's financial
goals is to enhance revenues.  In the past, we
have raised concerns about the adequacy of the
Service's controls over its revenues in areas such
as the acceptance of bulk business mail.15  In
fiscal year 1998, bulk business mail represented
49 percent of the Service's $58 billion in mail
revenues and about 66 percent of the nearly 200
billion pieces of mail it processed.  We are
currently conducting a follow-up review to
determine the status of the Service's actions to
implement our recommendations.  We expect this
report to be issued within the next several weeks.

     The Service has also enhanced its revenues
through leasing or selling some of its real
estate.  We recently issued a report that looked
at two real estate projects where the Service
leased space to private companies that developed
and operated the buildings-the Grand Central
Station Post Office in New York City and Rincon
Center in San Francisco. 16   The Service reported
obtaining about $16.5 million annually in revenue
from renting space in the renovated buildings
while preserving their historical characteristics.
In addition, the Service recently sold the Rincon
Center for $80.5 million, which the Service
reported added to its net revenues.

Breast Cancer Research Stamp
Competing in a Rapidly Changing Environment
     The Service's ability to adapt to increasing
competition is critical if the Service is to
maintain a competitive position in the rapidly
changing communications and delivery environment.
Increasing competition, particularly from
electronic alternatives, has slowed the Service's
revenue growth and is expected to have a
continuing impact on the Service's revenues in the
next decade.

     Other issues related to the Service's
competitive position have also been raised.  Some
concerns revolve around types of new products and
services that the Service is allowed to develop.
We recently provided information on the Postal
Service Marketing Department's process for the
review and approval of its new products. Also,
some of our work has addressed various concerns
regarding the Service's competitive position with
respect to international postal organizations.

New Postal Products
     The Service has for several years been
concerned that its First-Class Mail business could
become threatened as more and more traditional
mail migrates to electronic mail.  Coupled with
this, the Service has encountered competition from
the private sector that is significantly more
challenging than in past years.  To address these
situations, postal management, in the early 1990s,
established a corporate goal of initiating and
growing new businesses, particularly in the
electronic communications arena, in order to
ensure its commercial viability as a mover of
messages, merchandise, and money.

     As a result of this corporate decision, in
the mid-1990s, the Service began focusing
resources on the aggressive development and
introduction of new products-primarily nonpostal
products.  In November 1998, we reported on the
challenges faced by the Service in moving in this
new direction and presented a snapshot of the
progress made to date.17  We reported that the
Service's new products initiative was
controversial.  Some Members of Congress were
concerned that the Service was unfairly expanding
its product line to compete in nonpostal-related
markets and had introduced legislation to curtail
such activity.  Some private sector companies also
complained about the Service's entry into
nontraditional postal markets.  They were
concerned that the Service could use its
governmental status to an unfair advantage when
introducing products that compete with private
sector companies.  Notwithstanding this
controversy, the Service moved ahead with several
new products in the mid- to late-1990s.

     The Service has established a formalized
process to govern the introduction of most new
products.  To facilitate the process of developing
and introducing new products and to ensure
effective management control, the Service
developed a formalized system of checks and
balances that requires top management buy-in at
critical stages of the product development
process.  The process is also to be used to review
the performance of products and terminate those
that do not perform to Postal Service
expectations.  For those products we reviewed in
more detail, we found that the Service had
generally followed the tenets of the newly
established product development process.  We also
reported that most of the new products had not yet
produced revenues that exceeded expenses.  We
cautioned, however, that it might not be
reasonable to expect all new products to become
profitable in their early years, because new
products generally take several years to become
established and recover their start-up costs.

International Competition
     Congress has recently considered one of the
major international competition-related concerns
involving a potential conflict in the Service's
dual role as the U.S. negotiator of international
postal agreements and competitor with private
carriers in the international mail arena.  In a
recent report, we compared the roles of the
Service and the Department of State as
representatives of the U.S. government in
international organizations for the postal and
telecommunications sectors.18   The Department of
State has the lead responsibility for developing
U.S. international telecommunications policy and
heads a formalized process for policy development.
In October 1998, Congress transferred
responsibility for formulating, coordinating, and
overseeing international postal policy at the
international postal organization, the Universal
Postal Union (UPU), from the Service to the
Department of State.  We are currently reviewing
how effectively the Department of State has
implemented its new responsibilities in this area.

Our October 1998 report noted that differences in
legal requirements contributed to differences in
stakeholder involvement and the processes used to
develop U.S. policies for international postal and
telecommunications issues.  One key difference was
that the Department of State was legally required
to obtain input from the private sector on
international telecommunications policy issues;
however, the Service was not subject to such legal
requirements when it had the lead role for U.S.
involvement in the UPU.  In the international
telecommunications sector, we found that
government and private sector stakeholders had
more direct involvement in U.S. policy formulation
through a structured and documented advisory
committee process headed by the Department of
State and subject to the requirements of the
Federal Advisory Committee Act (FACA).19  FACA
requirements include Federal Register notice of
advisory committee meetings; detailed minutes of
meetings; public access and participation at
meetings; and annual reports to the General
Services Administration, which is to report to
Congress on the activities, status, and any
changes in the advisory committees.  In the postal
sector, the Service was not subject to FACA.  The
process for involving government and private
sector stakeholders in international policy
formulation was more informal, involving ad hoc
briefings with limited public notice or
documentation of meetings.   Our ongoing review
will examine how the process for U.S. policy
formulation, coordination, and oversight has
changed this year with respect to U.S.
participation in the UPU.

Other Major Issues
     Other major issues we recently addressed
include monitoring the Service's actions to meet
the challenges of preparing for the Year 2000 as
well as protecting consumers from deceptive mail
practices, protecting the privacy of address
changes, and improving its management of capital
facility projects.  Currently, we are also
reviewing the effectiveness of the Breast Cancer
Stamp as a fundraiser.

     Regarding Year 2000 readiness, we testified
that the Service started late in correcting and
testing its systems, preparing a master schedule,
and developing contingency and business continuity
plans.   However, the Service has made significant
progress in reducing vulnerabilities identified in
previous assessments and in planning a recovery
management process to restore its operations if
Year 2000 problems should occur.

     We also testified recently before this
Subcommittee on our work related to protecting
consumers from deceptive mail marketing practices.20
We provided information on the extent and nature
of consumers' problems with deceptive mail and
identified initiatives various federal agencies
and other organizations have made to address
deceptive mail problems and educate consumers.

     We also recently released a report on another
issue of interest to consumers, the Service's
protection of consumer address information from
unauthorized disclosure.21  We followed up on the
recommendations we had previously made for
specific actions the Service should take to
strengthen oversight of its National Change of
Address (NCOA) program.  The Service had not taken
action on our recommendation that it explicitly
state, in the acknowledgment form signed by
customers of the Service's address correction
licensees, that NCOA program-linked data are not
to be used to create or maintain new-movers lists.
We have suggested that Congress may wish to
consider amending the Postal Reorganization Act of
1970 to establish requirements concerning the
language in the form so that the Service could
help ensure that the use of NCOA program-linked
data is limited to the purposes for which they
were collected.

Year 2000 Problems
     The Postal Service faces a major challenge in
updating its computer systems, mail processing
equipment, and infrastructure equipment to avoid
Year 2000 malfunctions that could disrupt mail
delivery.  The Service has a special
responsibility to correct its computers because a
number of private sector and government groups may
need to use the Service as a backup delivery
system if their computers malfunction.  For this
reason, the Service is concerned about the
prospect of a mail surge in January 2000.  An
early assessment by the Service's Office of
Inspector General showed that the Service was slow
to recognize the scope of the challenge and act to
ensure that its computer systems were Year 2000
compliant.

     In February 199922 we identified the major
challenges facing the Service, including (1)
completing system renovation and mail processing
equipment correction and testing, (2) ensuring the
readiness of hundreds of local facilities, (3)
determining the ability of key suppliers and
electronic data exchange partners to be Year 2000
ready, (4) completing simulation testing of
business process areas, and (5) completing the
development and testing of business continuity and
contingency plans.

     Since February, the Service has strengthened
its management approach to the Year 2000 problem
and made significant progress in fixing its
systems and determining that its key suppliers and
electronic data exchange partners will also be
Year 2000 ready.  For example, as of this August,
the Service reported to the Office of Management
and Budget that it

ï¿½    completed renovation of 136 of its 137 severe
 and critical computer systems and expected to
 complete all non-mission critical systems by
 September 30, 1999;
 
ï¿½    certified all 38 critical mail processing
equipment and embedded chip devices as Year 2000
ready;
ï¿½    performed business impact assessments on all
353 critical field facilities and expected to
finish remaining readiness activities by October
15, 1999;
ï¿½    expected to complete impact assessments by
November 30, 1999, for all 3,500 field activities
that have automated systems and functions with
life safety and security ramifications;
ï¿½    obtained assurances of Year 2000 readiness
for 273, or 99.6 percent, of its critical
suppliers and completed site visits for all 34
"high profile" suppliers, i.e., those most
integral to the continuity of mail operations;
ï¿½    obtained assurances on Year 2000 readiness
for 73 percent of suppliers critical to the
Service's field operations; and
ï¿½    certified all 737 severe and critical
electronic data exchanges as Year 2000 compliant
and reported that all 106 important, but not
critical, electronic data exchanges would be
certified as compliant by September 30, 1999.
The Service has also stepped up efforts to test
applications and infrastructure equipment in a
production environment---an important phase of the
Year 2000 effort because Year 2000 conversions
often involve numerous large interconnecting
systems with many external interfaces and
extensive supporting technology infrastructures.
Over 40 applications that support critical
business processes were tested in the first of a
two-phased testing effort that ended in August
1999.  The Service is still analyzing the results
of these tests; however, it has reported that at
least one application will require additional
testing.

Finally, the Service has completed over 500
business continuity and component contingency
plans for its critical processes.  This is another
crucial phase of the Year 2000 effort because core
processes may still be disrupted by Year 2000-
induced failures and by errors in business partner
systems or public infrastructure systems, such as
power, water, transportation, and
telecommunications systems.  The Service's plans
include preemptive measures and work-arounds to
ensure critical business processes continue in the
event of a Year 2000-related disruption or system
failure.  The field plans were distributed in
August 1999, and all rehearsals and adjustments to
these plans are expected to be completed by
November 30, 1999.

With these actions under way, the Service is
clearly much better positioned to face the
upcoming century change.  However, the challenge
facing the Service is still significant: there are
less than 3 months remaining before the Year 2000
deadline, the Service is now entering into the
holiday business rush, and many important
tasks-including the rehearsal and finalization of
contingency and continuity plans-remain.  Thus,
the Service will need to sustain top management
attention to the problem and continue to do
everything necessary to ensure that the continuity
of important postal operations is maintained into
2000.

Status of Antelope Valley Project Remains
Uncertain
     The importance of sustained management
attention was evident in another area where we
identified weaknesses in the management of a
capital facility project. In August 1999, we
reported on the Service's project approval process
for a proposed project to relocate postal
operations to a new mail processing facility in
the Antelope Valley area in California.23 We raised
concerns about the unresolved status of the
proposed project after almost 10 years. The
Service purchased a 25-acre site in Lancaster, CA,
for $6.5 million in 1991 that has since remained
unused due to the Service's failure to decide on
whether the proposed processing facility should be
approved.  Also, we estimated that accumulated
interest costs associated with this $6.5 million
investment totaled about $2.9 million from the
time the site was purchased in October 1991
through June 1999, and they were likely to
increase by over $300,000 each year.  In addition,
the Service has not addressed the long-standing
problems, such as mail delivery problems and space
deficiencies, that were the basis for the proposed
Antelope Valley project.  We recommended that the
Postmaster General take action to resolve the
status of the project and report on planned
actions to address the operational deficiencies in
the Antelope Valley area.

Breast Cancer Research Stamp
     One of our ongoing efforts is a review of the
Service's Breast Cancer Research Stamp. The "Stamp
Out Breast Cancer Act," enacted August 13, 1997,
required that the Service market, for 2 years, a
semipostal stamp for breast cancer research.  A
semipostal stamp is a stamp that carries a
surcharge for a special purpose.

     The Service issued the First-Class Breast
Cancer Research stamp on July 29, 1998.  The stamp
is currently priced at 40 cents-33 cents for
postage with a 7-cent surcharge.  The stamp is to
be available for sale until July 29, 2000. The net
proceeds from the surcharge are going to the
National Institutes of Health and Department of
Defense for breast cancer research. The Breast
Cancer Research Stamp is the Service's first-ever
semipostal stamp.

     In addition to requiring the Service to
market the Breast Cancer Research Stamp, the act
also mandated that the Comptroller General report
to Congress, between January 29, 2000, and April
29, 2000, on the effectiveness and appropriateness
of using a semipostal stamp to raise funds for
breast cancer research.  Also, this report is to
include information on the monetary and other
resources required of the Service to produce and
market the Breast Cancer Research Stamp.

     After 1 year of sales, the Service reports
that surcharge revenue generated by the Breast
Cancer Research Stamp totaled approximately $8
million.  We expect to issue our report on the
stamp to Congress in the early part of the year
2000, as mandated by the act.

Recommendation
     We recommend that the Postmaster General
report to the House and Senate oversight
subcommittees on the Postal Service on the actions
taken and planned to improve the quality of data
used in ratemaking, including

ï¿½    actions taken to improve ratemaking data
 quality, such as those that relate to the
 recommendations included in the Data Quality Study
 conducted by A.T. Kearney; and
 
ï¿½    actions planned to improve ratemaking data
quality, including the priorities and time frames
for short-term and long-term actions.

     Mr. Chairman, this concludes my statement.  I
would be pleased to respond to any questions you
or the Members of the Subcommittee may have.

     Contact and Acknowledgment

     For future contacts regarding this testimony,
please contact Bernard L. Ungar at (202)-512-8387.
Individuals making key contributions to this
testimony included Teresa Anderson, Gerald Barnes,
Anne Hilleary, Kenneth John, Sherrill Johnson,
Roger Lively, Charles Wicker, and Lisa Wright-
Solomon.  Kim Raheb provided graphics support.
Carl Urie and Greg Donnellon provided information
on the Postal Service's Year 2000 compliance.

_______________________________
1Institutional costs do not vary by changes in
mail volume, such as costs to maintain a national
network of over 38,000 post offices and postal
facilities and to deliver to 130 million addresses
6 days a week.
2The Results Act: Observations on the Postal
Service's Preliminary Performance Plan for Fiscal
Year 2000 (GAO/GGD-99-72R, Apr. 30, 1999).
3Major Management Challenges and Program Risks:
U.S. Postal Service (GAO/OCG-99-21, January 1999).
4Data Quality Study, April 16, 1999, prepared by
LINX, a division of A.T. Kearney, Inc.  This
report is available at the U.S. Postal Service
Internet site at http://www.usps.gov/clr/dqs.htm.
5According to the Service, career employees
generally are persons who have permanent work
appointments and include such employees as clerks,
postmasters, managers, supervisors, mail handlers,
and city and rural letter carriers.  Noncareer
employees are persons who have limited-term work
appointments and include such employees as some
data conversion operators who work at postal
remote encoding centers and substitutes for rural
carriers.
6U.S. Postal Service: Labor-Management Problems
Persist on the Workroom Floor (GAO/GGD-94-201A/B,
Sept. 29, 1994).
7The three major postal labor unions involved in
1998 contract negotiations with the Service
included APWU, NALC, and Mail Handlers.  The
fourth union-the National Rural Letter Carriers'
Association-did not participate in such
negotiations because its contract is not due to
expire until November 1999.
8The three management associations include NAPUS,
NLPM, and the National Association of Postal
Supervisors.
9U.S. Postal Service: Information About Selected
Promotions of Women and Minorities to EAS
Management-Level Positions (GAO/GGD-98-200R, Sept.
21, 1998).
10U.S. Postal Service: Diversity in High-Level EAS
Positions (GAO/GGD-99-26, Feb. 26, 1999).
11The three locations where we reviewed
applications for the 117 promotions included the
Atlanta, Dallas, and Van Nuys performance
clusters.  A performance cluster is 1 of the
Service's 85 geographic service areas and includes
a customer service district, which is responsible
for overseeing post offices, and 1 or more mail
processing plants.
12U.S. Postal Service: Progress Made in
Implementing Automated Letter Sequencing, but Some
Issues Remain (GAO/GGD-98-73, Apr. 17, 1998).
13TFP measures the changes in the relationship
between the Service's outputs and resources
expended in producing those outputs.  The
Service's main outputs are mail volumes and
servicing an expanding delivery network.  By
tracking outputs and resource usage, TFP provides
a measure of historical performance.
14The Service's capital commitments in its Capital
Investment Plan represent expected contract awards
or options.  The Service generally does not pay
for these expenses until the goods are delivered
or a contractor meets its project schedule.
15U.S. Postal Service: Stronger Mail Acceptance
Controls Could Help Prevent Revenue Losses
(GAO/GGD-96-126, June 25, 1996).
16Public-Private Partnerships: Key Elements of
Federal Building and Facility Partnerships
(GAO/GGD-99-23, Feb. 3, 1999).
17U.S. Postal Service: Development and Inventory of
New Products (GAO/GGD-99-15, Nov. 24, 1998).
18U.S. Postal Service: Postal and
Telecommunications Sector Representation in
International Organizations (GAO/GGD-99-6BR, Oct.
29, 1998).
19FACA was enacted to ensure that (1) valid needs
exist for establishing and continuing advisory
committees, (2) the committees are properly
managed and their proceedings are as open as
possible to the public, and (3) Congress is kept
informed of the committees' activities.
20Deceptive Mail: Consumers' Problems Appear
Substantial (GAO/T-GGD-99-150, Aug. 4, 1999).
21U.S. Postal Service: Status of Efforts to Protect
Privacy of Address Changes (GAO/GGD-99-102, Jul.
30, 1999).
22Year 2000 Computing Crisis: Challenges Still
Facing the U.S. Postal Service (GAO/T-AIMD-99-86,
February 23, 1999).
23U.S. Postal Service: Deficiencies Continue While
Antelope Valley Project Status Remains Uncertain
(GAO/GGD-99-147, Aug. 31, 1999).

GAO Postal-Related Products Issued Since June 1,
1998
Page 29                            GAO/T-GGD-00-2
Performance Issues
The Results Act:  Observations on the Postal
Service's Preliminary Performance Plan for Fiscal
Year 2000 (GAO/GGD-99-72R, April 30, 1999).

Major Management Challenges and Program Risks:
U.S. Postal Service (GAO/OCG-99-21, Jan. 1999).

The Results Act:  Observations on the Postal
Service's Preliminary Annual Performance Plan
(GAO/GGD-98-144, July 10, 1998).

Employee Issues
Equal Employment Opportunity:  The Postal Service
Needs to Better Ensure the Quality of EEO
Complaint Data (GAO/GGD-99-167, Sept. 28, 1999).

Equal Employment Opportunity:  Complaint Caseloads
Rising, With Effects of New Regulations on Future
Trends Unclear (GAO/GGD-99-128, Aug. 16, 1999).

Equal Employment Opportunity:  Data Shortcomings
Hinder Assessment of Conflicts in the Federal
Workplace (GAO/GGD-99-75, May 4, 1999).

U.S. Postal Service:  Diversity in High-Level EAS
Positions (GAO/GGD-99-26, Feb. 26, 1999).

U.S. Postal Service:  Information About Selected
Promotions of Women and Minorities to EAS
Management-Level Positions (GAO/GGD-98-200R, Sept.
21, 1998).

Equal Employment Opportunity:  Rising Trends in
EEO Complaint Caseloads in the Federal Sector
(GAO/GGD-98-157BR, July 24, 1998).

Financial Viability Issues
Public-Private Partnerships: Key Elements of
Federal Building and Facility Partnerships
(GAO/GGD-99-23, Feb. 3, 1999).

Competition Issues
U.S. Postal Service:  Development and Inventory of
New Products (GAO/GGD-99-15, Nov. 24, 1998).

U.S. Postal Service:  Postal and
Telecommunications Sector Representation in
International Organizations (GAO/GGD-99-6BR, Oct.
29, 1998).

U.S. Postal Service:  Competitive Concerns About
Global Package Link Service (GAO/GGD-98-104, June
5, 1998).

Other Major Oversight Issues
U.S. Postal Service:  Deficiencies Continue While
Antelope Valley Project Status Remains Uncertain
(GAO/GGD-99-147, Aug. 31, 1999).

Deceptive Mail:  Consumers' Problems Appear
Substantial (GAO/T-GGD-99-150, Aug. 4, 1999).

U.S. Postal Service:  Status of Efforts to Protect
Privacy of Address Changes (GAO/GGD-99-102, July
30, 1999).

Year 2000 Computing Crisis:  Challenges Still
Facing the U.S. Postal Service (GAO/T-AIMD-99-86,
Feb. 23, 1999).

Proposed Legislation:  Issues Related to Honesty
in Sweepstakes Act of 1998 (S. 2141) (GAO/T-GGD-98-
198, September 1, 1998).

*** End of Document ***