U.S. Postal Service: Sustained Attention to Challenges Remains Critical
(Testimony, 09/19/2000, GAO/T-GGD-00-206).

Pursuant to a congressional request, GAO discussed the Postal Service's
(USPS) overall performance as well as the challenges that persist as
mail volume growth continues to slow and competition from the private
sector increases.

GAO noted that: (1) USPS has slightly improved its overnight First-Class
Mail delivery performance, improved productivity, and implemented
cost-cutting measures; (2) USPS has reported that it faces significant
threats from electronic substitution and is planning for declining mail
volumes, especially in First-Class Mail, in the coming years; (3)
although it is difficult to predict the timing and magnitude of further
mail volume diversion and potential financial consequences, USPS states
that it is working to address this challenge by aggressive cost-cutting
to achieve breakthrough productivity and by revenue generation; (4) a
key oversight issue for USPS, Congress, and the American people is
whether USPS is heading for financial shortfalls that could, in the long
run, hinder its ability to carry out its mission of providing
affordable, universal postal services that bind the nation together; (5)
several continuing challenges facing USPS include improving
productivity, controlling costs, enhancing revenues, and improving
labor-management relations; (6) long-term increases in productivity will
be essential for USPS' future success; (7) USPS recently reported to GAO
that its productivity for fiscal year 2000 through mid-August had
increased 2.2 percent; (8) although this would be the largest increase
since 1993, it would translate into a cumulative increase of only 1.5
percent over the past decade; (9) questions for continued oversight
include how and when USPS expects to achieve breakthrough productivity;
and (10) another issue is whether USPS, unions, and management
associations will be able to find a common ground to address
long-standing problems in the workplace that may impede USPS' ability to
improve its productivity.

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

 REPORTNUM:  T-GGD-00-206
     TITLE:  U.S. Postal Service: Sustained Attention to Challenges
	     Remains Critical
      DATE:  09/19/2000
   SUBJECT:  Performance measures
	     Strategic planning
	     Postal service
	     Competition
	     Postal rates
	     Cost control
	     Productivity in government
IDENTIFIER:  USPS Integrated Financial Plan
	     USPS Resolve Employment Disputes, Reach Equitable
	     Solutions Swiftly Program
	     USPS Postal Career Executive Service
	     USPS Breast Cancer Research Semipostal Program

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GAO/T-GGD-00-206

U. S. POSTAL SERVICE Sustained Attention to Challenges Remains Critical

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

United States General Accounting Office

GAO Testimony Before the Subcommittee on

The Postal Service Committee on Government Reform House of Representatives

For Release on Delivery Expected at 1: 00 p. m. EDT on Tuesday September 19,
2000

GAO/ T- GGD- 00- 206

Summary U. S. Postal Service: Sustained Attention to Challenges Remains
Critical

Page 1 GAO/ T- GGD- 00- 206

The Postal Service faces an uncertain future. Although the Service has
slightly improved its overnight First- Class Mail delivery performance this
year, improved productivity, and implemented cost- cutting measures, it has
encountered increasing financial difficulties as mail volumes have grown
more slowly than expected and as postal costs have been difficult to
restrain. The Service has reported that it faces significant threats from
electronic substitution and is planning for declining mail volumes,
especially in First- Class Mail, in the coming years. Although it is
difficult to predict the timing and magnitude of further mail volume
diversion and potential financial consequences, the Service states that it
is working to address this challenge by aggressive cost- cutting to achieve
breakthrough productivity and by new revenue generation.

A key oversight issue for the Service, Congress, and the American people is
whether the Service is heading for financial shortfalls that could, in the
long run, hinder its ability to carry out its mission of providing
affordable, universal postal services that bind the nation together. Key
questions facing the Service in the long term include the following:

ï¿½ Can the Postal Service maintain and, where necessary, improve on the
quality of mail delivery service?

ï¿½ Can the Service continue to provide affordable postal rates?

ï¿½ Can the Service remain self- supporting through postal revenues?

ï¿½ Can the Service continue in the long term to provide the current level and
scope of universal postal service?

Several continuing challenges facing the Service include improving
productivity, controlling costs, enhancing revenues, and improving
labormanagement relations. Long- term increases in productivity will be
essential for the Service's future success. The Service recently reported to
us that its productivity for fiscal year 2000 through mid- August had
increased 2.2 percent. Although this would be the largest increase since
1993, it would translate into a cumulative increase of only 1.5 percent over
the past decade. Questions for continued oversight include how and when the
Service expects to achieve breakthrough productivity. Another issue is
whether the Service, unions, and management associations will be able to
find common ground to address long- standing problems in the workplace that
may impede the Service's ability to improve its productivity.

GAO also has continued concern about the quality and transparency of the
Service's performance information. GAO's recent reports contain specific
recommendations for further improvements in this area.

Statement U. S. Postal Service: Sustained Attention to Challenges Remains
Critical

Page 2 GAO/ T- GGD- 00- 206

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 (the Service). In my testimony, I shall briefly discuss the
Service's overall performance during the past year as well as the challenges
that persist as mail volume growth continues to slow and competition from
the private sector increases. The Service provided us with updated
performance information that is included in this statement. Also, I will
discuss work that we have completed over the past year and provide
information on our ongoing work. A list of our reports and testimonies
related to postal matters issued since October 1999 is included in the
attachment to this statement.

The Service has slightly improved its overnight First- Class Mail delivery
performance this year, improved productivity, and implemented costcutting
measures. However, the Service has encountered increasing financial
difficulties as mail volumes have grown more slowly than expected and as
postal costs have been difficult to restrain.

Moreover, the Service faces an uncertain future, in view of its expectation
that mail volumes will decline in the coming years. A key oversight issue
for the Service, Congress, and the American people is whether the Service is
heading for financial shortfalls that could, in the long run, hinder its
ability to carry out its mission of providing affordable, universal postal
services that bind the nation together. Key questions facing the Service in
the long term include the following:

ï¿½ Can the Service maintain and, where necessary, improve on the quality of
mail delivery service?

ï¿½ Can the Service continue to provide affordable postal rates?

ï¿½ Can the Service remain self- supporting through postal revenues?

ï¿½ Can the Service continue in the long term to provide the current level and
scope of universal postal service?

The Service's recently approved 5- Year Strategic Plan for Fiscal Years 2001
through 2005 stated that the changes in competition challenge the Service's
traditional mission and raise questions about its public service obligations
that do not have easy answers. The Postmaster General recently said that the
Service is at a crossroads with regard to its ability to continue to provide
affordable universal service. Earlier this month, the Chairman of the Postal
Rate Commission (PRC) also raised the possibility that the nature of
universal postal service, specifically delivery to every address 6 days each
week, may need to be reconsidered at some point if The Service's

Performance and Future Challenges

Statement U. S. Postal Service: Sustained Attention to Challenges Remains
Critical

Page 3 GAO/ T- GGD- 00- 206

competition leads to large declines in the Service's mail volume. Other
stakeholders have also raised concerns about the potential effect of
competition on universal postal service. In my testimony, I will provide an
update on the Service's recent accomplishments, key trends affecting the
Service, and how the Service plans to respond to the formidable challenges
it is facing.

Over the past fiscal year, the Service has slightly improved its overnight
First- Class Mail delivery service performance. In its fiscal year 2000
performance plan, the Service established targets of 93 percent on- time
delivery of overnight First- Class Mail. The Service reported that it
delivered about 94 percent of overnight First- Class Mail on time in the
first 3 quarters of fiscal year 2000. If this performance were sustained for
the fourth quarter, it would represent a record level of annual performance
since the Service began its current measures in the early 1990s. The Service
also established a target of on- time delivery for 2/ 3- day First- Class
Mail- which accounts for more than half of First- Class Mail volume- of at
least 87 percent, with at least 1- percent improvement over the previous
fiscal year. For the first 3 quarters of fiscal year 2000, the Service
reported that on- time performance for 2/ 3- day First- Class Mail was about
85 percent, compared with about 86 percent for all 4 quarters of fiscal year
1999.

In addition, the Service recently reported that 92 percent of residential
customers surveyed by the Gallup Organization rated its overall service as
excellent, very good, or good, including 29 percent who rated their overall
service as excellent, 42 percent as very good, and 21 percent as good.

We testified last year before this Subcommittee that the Service may be
nearing the end of an era as it faces growing challenges from competition,
notably from private delivery companies and electronic communications
alternatives such as the Internet. The Service and some 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. Service officials expect that
competition will lead to declines in First- Class Mail volume in the next
decade and a consequent loss of revenues.

The Service achieved its best ever financial and service performance over
the past 5 years. However, according to the Postmaster General, the Service
has encountered increasing difficulties in meeting this year's goal of $100
million in net income. The Service recognizes that it faces challenges from
a dynamic and versatile marketplace, changing customer The Service's
Delivery

Performance and Customer Satisfaction

The Service Faces an Uncertain Future

Statement U. S. Postal Service: Sustained Attention to Challenges Remains
Critical

Page 4 GAO/ T- GGD- 00- 206

demands, and more alternative delivery options that provide greater choices
for customers.

As an example of trends that have affected the Service's mail volumes, at
the federal level, government agencies are mandated to move as quickly as
possible to reduce paperwork and to adopt electronic billing and payment. Of
the 880 million Social Security checks, tax refunds, and other payments sent
by the Department of the Treasury in fiscal year 1999, 68 percent were sent
electronically rather than mailed. According to the Service, this resulted
in $180 million in lost First- Class Mail revenue. Further, according to a
postal operations survey conducted by the American Bankers Association, the
banking industry reduced its mail volume in 1999 by almost 18 percent
compared with its 1996 level.

In fiscal year 2000, the Service's total mail volume has grown by 2. 7
percent through accounting period 12 (August 11, 2000) compared to the same
period in fiscal year 1999, which has been less than the 3.8 percent called
for in the Service's Integrated Financial Plan for fiscal year 2000. This
difference has contributed to a shortfall in the Service's revenues compared
with what it had originally budgeted for, and thus made it more difficult
for the Service to achieve its target of $100 million in net income for
fiscal year 2000. Earlier this month, the Deputy Postmaster General
testified before Congress that it is unprecedented for mail volume to grow
at such a slow rate given the strong growth in the general economy, which
has been associated with faster mail volume growth in the past.

As figure 1 shows, for fiscal year 2000 through accounting period 12, the
Service's mail volume growth rate had not reached its projected growth rate
for fiscal year 2000 1 -which ended on September 8, 2000- for its major mail
categories:

ï¿½ First- Class Mail volume increased at a 1.3- percent rate in fiscal year
2000 through accounting period 12, compared with the same period in fiscal
year 1999. The Service had projected a 2. 5 percent growth rate for
FirstClass Mail in its Integrated Financial Plan for Fiscal Year 2000.

ï¿½ Standard A (primarily advertising) mail volume increased by 4.9 percent
during this period, which was somewhat less than the 5.7 percent rate
projected for the full year.

1 The dates that Service fiscal years end vary by year and conform to the
Service's 13- period accounting year. Accounting period 12 ended on Aug. 11,
2000, and accounting period 13 ended on Sept. 8, 2000.

Statement U. S. Postal Service: Sustained Attention to Challenges Remains
Critical

Page 5 GAO/ T- GGD- 00- 206

ï¿½ Priority mail volume increased by 3. 1 percent during fiscal year 2000
through accounting period 12. The Service's plan had projected a 4.1 percent
increase for fiscal year 2000.

Source: Postal Service Financial and Operating Statements, fiscal year 2000
through accounting period 12 (August 11, 2000), and Fiscal Year 2000
Integrated Financial Plan.

To put these results into context, First- Class Mail, Standard A mail, and
Priority mail accounted for the vast majority of the Service's total mail
volume, total revenues, and total contribution to pay for institutional
costs (see figures 2 and 3).

Figure 1: Fiscal Year 2000 Mail Volume Growth Rate Has Been Less Than
Projected

Statement U. S. Postal Service: Sustained Attention to Challenges Remains
Critical

Page 6 GAO/ T- GGD- 00- 206

Note 1: International mail revenue includes foreign postal transaction
revenue. Note 2: Percentages may not add to 100 due to rounding. a Other
includes Express Mail, periodicals, international mail, Standard mail (B),
U. S. Postal Service

mail, free mail for the blind and handicapped, and mailgrams. Source:
Service's 1999 Annual Report.

Figure 2: Composition of Service Mail Volume and Corresponding Revenues,
Fiscal Year 1999

Statement U. S. Postal Service: Sustained Attention to Challenges Remains
Critical

Page 7 GAO/ T- GGD- 00- 206

Note: Percentages may not add to 100 due to rounding. a Other includes
Express Mail, periodicals, international mail, standard mail (B), U. S.
Postal Service

mail, free mail for the blind and handicapped, and mailgrams. Source:
Service documents, fiscal year 1999.

Looking ahead, the Service's 5- Year Strategic Plan for Fiscal Years 2001
through 2005 stated that the substitution effect from new technology on the
Service's mail volume is expected to have a significant impact on
contribution (or margin). The Strategic Plan reported that the expected
declines are likely to be in the categories of mail that the Service handles
most efficiently- First- Class bills and payments.

The Strategic Plan stated that for the first time, the Service has adopted a
planning assumption that the long- term close relationship between the
growth of the economy and mail volume will change in the future, leading to
declining mail volumes for First- Class Mail and eventually even Standard A
mail. The Service's assumption for its baseline scenario is based on its
expectation of “moderate diversion” of First- Class Mail to
substitutes such as Electronic Bill Presentment and Payment and e- mail. The
baseline scenario presented in the Service's Strategic Plan is somewhat more
pessimistic than the baseline scenario that the Service reported to us last
year and that was included in our testimony before your Subcommittee. The
current baseline scenario calls for total mail volume to increase less,
start to decline 1 year sooner, and to decline to a greater extent than last
year's baseline scenario.

Figure 3: Net Contribution to Overhead, Fiscal Year 1999

Statement U. S. Postal Service: Sustained Attention to Challenges Remains
Critical

Page 8 GAO/ T- GGD- 00- 206

However, the Service is also considering the possibility that mail volume
may decline even sooner and faster than it does in its revised baseline
scenario. The Strategic Plan reported that most external experts suggest a
“rapid diversion scenario” where diversion would occur more
rapidly, and also impact Standard A mail volumes as interactive Internet
advertising reduces traditional targeted advertising mail and catalogs.

The Strategic Plan noted that, like many organizations, the Service was
unable to predict the speed at which the Internet has changed the American
economy. The Strategic Plan stated that there is broad agreement that the
Service will face significant threats from electronic substitution, and that
mail volumes, especially in First- Class Mail, are likely to decline in the
near future. However, as the plan recognized, there is considerable
uncertainty about the timing and rate of diversion, as well as whether the
Service can or should do anything about it.

Although it is difficult to predict the timing and magnitude of further mail
volume diversion and potential financial consequence, the Service has begun
to plan how it would address a range of such scenarios. The Service's Acting
Chief Financial Officer told us that because of the uncertainty concerning
future mail volume trends, the Service considers it prudent to develop a
range of scenarios and do contingency planning for them. He told us that it
takes time for an organization as large and as complex as the Service to
plan and prepare for the major operational changes that would likely be
necessary in the event of substantial declines in the Service's mail volume.
He also noted that the Vice- Chairman of the Service's Board of Governors
said earlier this month that because the Service does not know how fast or
how much the Internet will change the Service's business model, the stakes
are high and the Service cannot wait to be certain before it acts.

The Service's basic strategy is a combination of aggressive cost- cutting
and new revenue generation. The Service's Strategic Plan stated that the
Service expects that if electronic diversion does not shift into high gear,
leading to more rapid volume decline, then it can sustain its viability over
the next 5 years by dramatically cutting costs and seeking new revenue
sources within the current regulatory structure. However, the Strategic Plan
noted that if postal markets change over the next 5 years faster than
currently anticipated, postal management and stakeholders will need to
address a number of issues, including

ï¿½ the definition of universal postal service,

ï¿½ the potential realignment of service standards, and The Implications of
Mail

Volume Trends for the Service

Statement U. S. Postal Service: Sustained Attention to Challenges Remains
Critical

Page 9 GAO/ T- GGD- 00- 206

ï¿½ the configuration of current operations and infrastructure. The Strategic
Plan warned that historic increases in productivity and aggressive
management of the size of the Service workforce already are anticipated.
Therefore, according to the Strategic Plan, if the volume decline is as
drastic as some experts have forecast, especially in critical mail
categories currently carrying the burden of contribution to institutional
overhead, postal rates are likely to increase dramatically for the remaining
mail volume. Further, other categories of mail would also be affected.
Although the Strategic Plan noted that any prediction of the impact of mail
volume 5 years in advance is almost certain to be flawed, the Service
anticipates the need for a “structural transformation” that is
to include, among other things, achieving “breakthrough
productivity.”

The Service reported to us that the increase in its overall productivity for
fiscal year 2000 through accounting period 12, as measured by Total Factor
Productivity (TFP), was 2.2 percent. 2 If this increase were sustained for
the full fiscal year, it would represent the fifth- largest annual increase
in postal productivity since 1970, and the largest increase since fiscal
year 1993. Nonetheless, since postal productivity declined in 5 of the last
6 fiscal years (from 1994 through 1999), a 2.2 percent productivity increase
in fiscal year 2000 would translate into a cumulative productivity increase
of only 1.5 percent from fiscal year 1990 to fiscal year 2000. Further,
postal productivity would thereby increase by only 12.2 percent since
1970– despite the vast changes in postal automation and postal
operations that have occurred in the past 3 decades.

In addition, a 2.2- percent increase in postal productivity would be less
than the 3.1- percent increase that was incorporated into the Service's
Performance Plan for Fiscal Year 2000. The Service told us on September 7,
2000, that “Because of the Postal Service's financial and operational
success in FY 1999, the actual productivity improvement estimated to be
required to achieve its FY 2000 net income plan of $100 million was revised
to 2.1 percent.” However, it is unclear whether such a productivity
improvement would be sufficient for the Service to meet its net income goal.
As reported in the press, the Postmaster General said at the end of August
that the Service could record a deficit up to $300 million for fiscal year
2000.

2 TFP 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. Recent Productivity

Changes and the Challenge of Achieving Breakthrough Productivity

Statement U. S. Postal Service: Sustained Attention to Challenges Remains
Critical

Page 10 GAO/ T- GGD- 00- 206

As the Service and key stakeholders have recognized, long- term increases in
its productivity will be essential to its future success. For example, the
Mailers Council, a coalition of mailers and mailing associations, reported
this March that increasing competition, operating and cost management
constraints- some imposed by outside entities- as well as the consequences
of management decisions, have influenced a decline in the Service's
productivity in past years. 3 The report stated that: “As a result of
these factors, at a time when every competing technology is becoming less
expensive, the cost of using the nation's mail system is becoming more
expensive. To ensure the Service's survival, therefore, the Mailers Council
believes postal management must focus its considerable skills and resources
on those factors it can control, and thereby generate needed productivity
gains.” The report noted the need for the Service to reduce its costs
and become more efficient to achieve productivity gains.

As we testified last year, the Service's ability to maintain financial
viability by controlling costs, improving productivity, and enhancing
revenues presents a continuing challenge. We have reported that the
Service's continued success will depend heavily on its ability to control
operating costs, and that the Service has recognized that it needs
aggressive cost management to avoid unwarranted costs. The Service has made
some progress this year in controlling costs through reducing the number of
workhours. For fiscal year 2000 through accounting period 12, the Service
reported it had reduced the total number of workhours compared to the same
period in fiscal year 1999 while, at the same time, increasing the number of
delivery points in the postal network.

In his March 20, 2000, speech at the National Postal Forum, the Postmaster
General said that the Service intends to reduce expenses by at least $4
billion by 2004. He estimated that about $700 million a year would come from
“breakthrough productivity” in the mail processing system, while
about $100 million annually would come from overhead reductions, about $100
million annually from reducing transportation costs, and about $100 million
annually from more efficient paperwork and purchasing. However, on August
11, 2000, the Service told the PRC that: “The amounts from the PMG's
speech represented an aggressive challenge to the organization rather than a
blueprint for specific cost savings.” The Service said that it
expected to achieve only $744 million in cost savings in the “test
year” (i. e., the year after the proposed rate increase would go into
effect), largely because it expected to achieve only $466 million of the
called- for $700 million in cost savings in mail processing and other
operations. The

3 Postal Service Productivity: Real Improvements Needed Now, Mailers
Council, Mar. 8, 2000. The Challenge of

Maintaining Financial Viability

Statement U. S. Postal Service: Sustained Attention to Challenges Remains
Critical

Page 11 GAO/ T- GGD- 00- 206

Service said that it “recognizes the difficulty in achieving the
aggressive cost reductions in fiscal year 2001, the first year of the
Breakthrough Productivity Initiative.” Given this response, questions
for continued oversight include the following:

ï¿½ What does the Service consider to be breakthrough productivity?

ï¿½ How does the Service expect to achieve breakthrough productivity?

ï¿½ When does the Service expect to achieve breakthrough productivity? We
continue to believe that the Service and its major postal labor unions and
management associations need to focus on common approaches for addressing
persistent labor- management relations problems, thereby improving the
Service's work environment and helping it maintain its competitive position.
The August 2000 Report of the Postal Service Commission On A Safe and Secure
Workplace noted that “A sea change in attitudes of all of the parties-
and an environment of trust- will be required to slash the number of
grievances and reshape compensation systems. This will require a sustained
effort.” The report said that in order to eliminate sources of
friction, postal management, unions, and management associations must work
together.

Further, the report noted that the Service had an enormous backlog of more
than 126,000 grievances, and that more than 6,300 grievances were arbitrated
in fiscal year 1999. By way of comparison, in the entire automobile
industry, with about 400,000 bargaining employees, only 11 grievances
reached arbitration in 1998, according to the report. Several federal
agencies contacted by the Commission also reported only a few arbitrations a
year. Further, the report said that the Service has procedures similar to
some other organizations that do not have such unusually large numbers of
complaints. The report said that the annual cost of postal grievances was
recently estimated at $217 million, with a small industry of more than 300
aribtrators handling postal cases. At the same time, the report recognized
that many grievances in the backlog are related issues grieved separately,
such as 40,000 grievances filed by the American Postal Workers Union in a
dispute over wash- up time in the New York district.

The Service reported to us that, as of the end of fiscal year 1999, out of
about 708,000 bargaining unit employees, about 114,000 grievances were
awaiting arbitration at the regional level, up slightly from 112,000 a year
ago. However, the Service also reported that about 97,000 grievances had
Continuing Disagreements

in Labor- Management Relations

Statement U. S. Postal Service: Sustained Attention to Challenges Remains
Critical

Page 12 GAO/ T- GGD- 00- 206

been appealed to step 3 4 , down from about 112, 000 a year ago. In
addition, the Service's General Counsel told us that the Service's Resolving
Employee Disputes, Reaching Equitable Solutions Swiftly (REDRESS) program
had helped to reduce the number of Equal Employment Opportunity (EEO)
complaints, reversing the past trend toward more EEO complaints.

Although any progress in this area is encouraging, we are concerned that
continuing disagreements in labor- management relations may impede efforts
to achieve improvements in postal productivity. As some stakeholders have
noted, keeping the Service financially viable while maintaining the level
and scope of universal postal service is expected to become increasingly
difficult. A recognition that similar survival issues were at stake helped
lead to major improvements in labor- management relations in the auto
industry. Thus, a key question for oversight is whether the Service, its
labor unions, and its management associations share the same sense of
urgency in improving labor- management relations and finding common ground
to address long- standing problems in the workplace.

In another key area for congressional oversight, we believe that complete
and reliable performance data will be essential for the Service, Congress,
and stakeholders to monitor the Service's progress towards meeting its
goals. The Service has recognized the need for more accurate and complete
information on postal performance. In its Strategic Plan, the Service stated
that it will invest in a new “Information Infrastructure” to
achieve three goals: streamline interaction with customers; provide more
timely, accurate, and relevant information to effectively manage operations
and reduce costs, improve service performance and sustain quality; and
provide more timely, accurate, and relevant information to allocate costs
and improve productivity. The Service said that it plans to spend about $2
billion on various information systems over the next 5 years and to develop
an “Information Platform” to help it manage its resources more
effectively and efficiently.

While we encourage the Service to continue its efforts to improve its
performance information, we remain concerned about the quality and
transparency of the Service's performance information. We have reported on,
and are continuing to monitor, opportunities for improvement in the
Service's performance information. Specifically:

4 Step 3 grievances are grievances that have been appealed by the unions to
the area level because they could not be resolved at the plant or district
levels. The Need for Complete and

Reliable Information on Postal Performance

Statement U. S. Postal Service: Sustained Attention to Challenges Remains
Critical

Page 13 GAO/ T- GGD- 00- 206

ï¿½ In our testimony last year before this Subcommittee, we highlighted the
need for the Service to take action to address long- standing issues related
to the quality of data used in ratemaking and recommended that the
Postmaster General report to congressional oversight subcommittees on the
actions taken and planned in this area. 5 The Service pledged to
periodically report on progress in implementing the recommendations of a
study that was initiated by your Subcommittee on the quality of data used by
the Service in setting rates. In its latest report to your Subcommittee in
July 2000, the Service documented actions taken and planned to improve the
quality of rate- setting data. The report also contained much useful
information on the status of each of the outstanding recommendations as well
as the resources devoted to improving data quality.

ï¿½ Our recent report on the Service's e- commerce initiatives found
deficiencies in the financial information the Service provided for the
ecommerce activities that raised concerns about the accuracy and
completeness of the financial reporting for e- commerce activities. 6 We do
not believe the e- commerce financial data that the Service provided was
sufficiently complete and reliable to be used to assess its progress toward
meeting its overall financial performance expectation, which is that
revenues generated by e- commerce products and services in the aggregate are
to cover the Service's direct and indirect costs as well as make a
contribution to overhead. The Service agreed with our recommendation that it
provide complete and accurate information on costs and revenues for the
financial data on e- commerce initiatives and said it is instituting a
standard financial reporting procedure in this area. Actions the Service has
reported taking are important and need to be effectively implemented.

ï¿½ On November 6, 1998, the Service reported to your Subcommittee that:
“We recognize the need to provide our customers with specific measures
of delivery performance for all our products and services.” The
Service said it intended to use a phased approach to develop measures as
soon as possible for products such as Periodicals. However, the Service's 5-
Year Strategic Plan for fiscal years 2001 through 2005, which was approved
by the Board last month, stated that “Currently, an internal system is
used to measure delivery within requested windows for only a small portion
of Standard A and Periodicals mail. The need to build a better indicator is
clearly necessary if we are to satisfy the need of our advertising and

5 U. S. Postal Service: Challenges to Sustaining Performance Improvements
Remain Formidable on the Brink of the 21 st Century (GAO/ T- GGD- 00- 2,
Oct. 21, 1999). 6 U. S. Postal Service: Postal Activities and Laws Related
to Electronic Commerce (GAO/ GGD- 00- 188, Sept. 7, 2000).

Statement U. S. Postal Service: Sustained Attention to Challenges Remains
Critical

Page 14 GAO/ T- GGD- 00- 206

periodical customers in the future . . . . Over the next several years,
technology will enable the USPS to develop service performance measurement
systems for all major categories of mail and for any new services introduced
to the market.” Thus, the Service has recognized the need for
improvement in its performance measures for mail delivery but this task will
remain incomplete for some time to come. As we reported in January 1999, it
will be important for the Service to develop resultsoriented measures for
its critical functions and program areas, as intended by the Government
Performance and Results Act of 1993 (GPRA). 7

In addition, we are releasing today our report that discusses the Service's
fiscal year 1999 performance report and the fiscal year 2001 preliminary
performance plan that are required under GPRA. In our report we identified
some positive aspects, however, we are concerned that the Service's
performance plans and performance reports may not have been as useful to
Congress, postal managers, and others as they could have been. As we
reported, we believe that in preparing future performance plans and
performance reports, the Service needs to focus more acutely on providing
and presenting information that is clear and understandable. Accordingly, we
made recommendations for improvements so that interested parties would be
able to more easily determine how well the Service is improving performance
and achieving its goals, as intended by GPRA.

Although we recognize that this was the first year that the Service
published a performance report, we have some concerns regarding the way
information was presented. For example, we believe it was misleading for the
Service's fiscal year 1999 performance report to highlight that the Service
exceeded its targets for overnight and 2/ 3 day ontime deliveries,
particularly when there was not an accompanying acknowledgement that less
than a full year's performance was used in making that determination. The
Service's fiscal year 1999 performance plan established 93 and 87 percent
targets for on- time delivery for overnight and 2/ 3 day First- Class Mail,
respectively; and portrayed these as annual targets. When all 4 quarters of
fiscal year 1999 performance data were aggregated, the Service met, but did
not exceed, its goal of 93 percent on- time delivery of overnight First-
Class Mail. It also delivered 86 percent of the 2/ 3- day First- Class Mail
on time- 1 percentage point less than the established target of 87 percent.
The Service's performance for all 4 quarters of fiscal year 1999 either met,
or came close to meeting the established targets. Therefore, we question why
the Service chose to

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

Statement U. S. Postal Service: Sustained Attention to Challenges Remains
Critical

Page 15 GAO/ T- GGD- 00- 206

highlight information that did not include performance for the full fiscal
year, including its performance during its heaviest volume period- the
holiday mailing season.

We also assessed the Service's fiscal year 2001 preliminary performance
plan. Some of the positive aspects of this plan included additional
performance indicators and targets for selected subgoals, such as targets
for (1) overall customer satisfaction (residential and business); (2)
resolving employee complaints (Resolving Employee Disputes, Reaching
Equitable Solutions Swiftly-- REDRESS); and (3) the Voice of the Employee
survey- which is the vehicle used by the Service to improve its
understanding of employee issues and concerns. However, several subgoals,
indicators, and targets that were included in the Service's fiscal year 2000
performance plan were dropped from the fiscal year 2001 preliminary
performance plan. Dropped subgoals included (1) keeping price increases at
or below the rate of inflation, (2) controlling costs by achieving
productivity gains, and (3) restoring equity. The preliminary performance
plan did not fully explain why these three subgoals, indicators, and targets
were dropped. In May 2000, the Board of Governors stated that it had decided
to restore Total Factor Productivity as a national- level results indicator.
However, if the Service does not set a goal concerning price increases, it
will be more difficult to hold the Service accountable for its performance
in this area.

Our report makes recommendations to the Postmaster General regarding
specific opportunities for improvement concerning both the Service's fiscal
year 2001 preliminary performance plan and its fiscal year 1999 performance
report. In commenting on our draft report, the Service generally agreed with
the facts and said it planned to implement the report's recommendations.

I would now like to provide you with a brief summary of work we have
completed on other postal issues since the fall of 1999. This work resulted
in reports and/ or testimony on (1) the Service's electronic commerce
activities, (2) diversity in the Service, (3) the Breast Cancer Research
Semipostal Stamp, (4) acceptance controls for business mail, and (5) the
Department of State's implementation of its international postal
responsibilities. In addition, we have ongoing work related to supervisory
pay differentials. Our Work Related to

Other Postal Issues

Statement U. S. Postal Service: Sustained Attention to Challenges Remains
Critical

Page 16 GAO/ T- GGD- 00- 206

On September 7, 2000, we testified 8 and issued a report 9 on the Service's
electronic commerce initiatives. We reported that the Service is in the
early stages of implementing an electronic commerce (e- commerce) program.
It has taken steps this year to develop and implement ecommerce activities,
including developing a definition of its e- commerce initiatives,
identifying e- commerce and related initiatives, and establishing a process
for approving these initiatives. The Service identified seven ecommerce
initiatives involving products and services meant to facilitate the movement
of messages, merchandise, and money in ways that require the use of the
Internet and generate revenues for the Service. The Service also outlined
overall e- commerce goals and strategies and developed some performance
targets for its e- commerce initiatives. However, we identified three
problem areas relating to the Service's management of its ecommerce area:

ï¿½ inconsistencies in identifying e- commerce and related initiatives and in
reporting the status of these activities that made it difficult for us to
ensure we had a complete and accurate picture of the Service's e- commerce
activities;

ï¿½ inconsistencies in following the required process for reviewing and
approving its e- commerce initiatives, which raised questions as to whether
the initiatives were appropriately planned and reviewed; and

ï¿½ deficiencies in the financial information the Service provided for the
ecommerce activities that raised concerns about the accuracy and
completeness of the financial reporting for e- commerce activities.

To help ensure more effective management and oversight of the Service's e-
commerce activities, we recommended that the Postmaster General (1) take
appropriate actions to help ensure that e- commerce and related initiatives
are appropriately identified and maintain accurate and complete information
related to the status of these initiatives; (2) follow processes and
controls that have been established for developing and approving ecommerce
initiatives; and (3) provide complete and accurate information on costs and
revenues for the financial data on e- commerce initiatives. The Service
endorsed our recommendations and reported that it is taking action to
implement them.

8 U. S. Postal Service: Electronic Commerce Activities and Legal Matters
(GAO/ T- GGD- 00- 195, Sept. 7, 2000). 9 GAO/ GGD- 00- 188. Electronic
Commerce

Statement U. S. Postal Service: Sustained Attention to Challenges Remains
Critical

Page 17 GAO/ T- GGD- 00- 206

In the legal area, the Service provided its views on how various laws and
regulations apply to its e- commerce activities. The Service said that its
unique status as an independent establishment of the executive branch gives
it broad legal authority and discretion to offer e- commerce products and
services in ways that the Service finds appropriate to its assigned
functions and in the public interest. The Service, some competitors, and
others have conflicting views on the extent of the Service's legal authority
to offer e- commerce products and services and under what circumstances it
should offer such services.

During the past year, we issued two reports to Congressman Chaka Fattah, the
Subcommittee's Ranking Minority Member, concerning employee diversity and
Equal Employment Opportunity (EEO) issues. Specifically, we issued a report
in March 2000, on the representation of women and minorities in the Postal
Career Executive Service (PCES), 10 and in June 2000, a report on diversity
in district management- level positions. 11

In our March 2000 report, we provided information on the representation of
women and minorities in PCES, which includes officers and executives. Among
other things, we determined that at the end of fiscal year 1999, women and
minorities represented about 35 percent of the PCES executive workforce
compared to their representation of about 58 percent in the Service's
overall workforce. We also found that women and minority representation
among the Service's PCES executive workforce was about 35 percent compared
with about 32 percent in the federal government's career Senior Executive
Service (SES), excluding the Department of Defense (DOD).

The Service reported that it had various efforts under way or planned that
related to increasing diversity among its PCES executives. For example, in
November 1998, the Service required that its PCES merit performance
evaluation process address diversity- related activities in individual
executive performance objectives and that executives be accountable for the
accomplishment of those objectives. The Service also reported that it had
developed management training programs to help employees better manage their
careers, and had established a diversity oversight group to oversee
corporate diversity initiatives.

10 U. S. Postal Service: Diversity in the Postal Career Executive Service
(GAO/ GGD- 00- 76, Mar. 30, 2000). 11 U. S. Postal Service: Diversity in
District Management- Level Positions (GAO/ GGD- 00- 142, June 30, 2000).
Diversity

Statement U. S. Postal Service: Sustained Attention to Challenges Remains
Critical

Page 18 GAO/ T- GGD- 00- 206

Our June 2000 report focused on diversity among 83 postal districts located
throughout the United States. 12 More specifically, it provided information
on the representation of women and minorities (in the Service's districts)
in levels 16 through 26 of the Service's Executive and Administrative
Schedule (EAS). 13 The report also provided more detailed information on the
representation of women and minorities in EAS levels 16 through 26 for the
Chicago, IL, and Akron, OH, postal districts; initiatives implemented to
promote diversity; and lessons identified by district officials that related
to increasing diversity in those two districts.

At the end of fiscal year 1999, women and minorities in the Service's
districts represented a district average of about 49 percent of the EAS 16
through 26 workforce compared with their average representation of about 56
percent across all district workforces (excluding EAS levels 16 through 26).
Women and minority representation in EAS levels 16 through 26 in the
Service's 83 districts ranged from a low of about 22 percent in the
Middlesex- Central district office to a high of 95 percent in the Los
Angeles district office. Concerning the representation of women and
minorities in the Chicago and Akron district offices, at the end of fiscal
year 1999, in Chicago, women and minorities represented about 93 percent of
the EAS 16 through 26 workforce compared with their overall workforce
representation of 92 percent. In Akron, for this period, women and
minorities represented about 41 percent of the district's EAS 16 through 26
workforce compared with their overall workforce representation of about 46
percent.

Both districts implemented several diversity- related initiatives, such as
various training programs, including national programs to increase the
representation of women and minorities in EAS levels 16 through 26. In
addition, to improve other aspects of diversity, both districts were using
REDRESS (Resolve Employment Disputes, Reach Equitable Solutions Swiftly), a
national alternative dispute resolution program, to facilitate discussion
between managers and employees on individual EEO complaint issues. Locally,
Chicago and Akron officials had also developed their own individual
initiatives and had identified several lessons related to increasing
diversity in their districts' EAS 16 through 26 workforces, which included
(1) management must demonstrate its commitment to diversity;

12 The Service has 85 districts. We did not include two district offices-
San Juan and Honolulu- in our report because they were missing significant
amounts of data on sex and /or race/ ethnic origin. 13 The EAS workforce
consists primarily of employees in EAS levels 11 through 26 positions. EAS
management- level positions generally start at EAS 16 and include such
positions as postmaster, manager of customer services, and manager of postal
operations.

Statement U. S. Postal Service: Sustained Attention to Challenges Remains
Critical

Page 19 GAO/ T- GGD- 00- 206

(2) training and career development programs must be made available to
provide opportunities for women and minorities to ascend to supervisory and
management- level positions; and (3) an environment that encourages
communications and cultural appreciation between management and employees
must be established.

Regarding the alleged EEO concerns at the Youngstown, OH, postal site,
although the number of EEO complaints had increased between fiscal years
1997 and 1999, it was not clear whether the complaints stemmed from alleged
discrimination, lack of communications, or labor/ management problems.
District records showed that the number of EEO complaints in Youngstown
increased in fiscal year 1999. However, as of May 2000, 51 of the 57
complaints filed were closed. Of these, one resulted in a finding of
discrimination. According to some district and union officials, EEO
complaints in Youngstown were based little, if at all, on discrimination,
but rather on poor communications among managers, supervisors, and employees
or poor labor/ management relations.

In our June 2000 report, we recommended that the Service reassess the EEO
situation in Youngstown to determine what the issues were with respect to
the workplace environment, such as discrimination, communications, or labor/
management relations; and what additional actions need to be taken. The
Service concurred with our recommendations and told us that they intended to
implement them.

In April 2000, we reported on the Service's Breast Cancer Research
Semipostal (BCRS) stamp. 14 We also participated in a hearing on the BCRS of
the Senate Subcommittee on International Security, Proliferation, and
Federal Services, Committee on Governmental Affairs, in May 2000. 15 The
Stamp Out Breast Cancer Act of 1997 directed the Postal Service to establish
a special stamp- known as a semipostal- to raise money for breast cancer
research. The BCRS was to be available for sale through July 28, 2000- 2
years from the date it was issued. The BCRS was the first stamp ever issued
by the Service to raise money for nonpostal purposes. The BCRS costs 40
cents, and is valid for the 33- cent First- Class postage rate, leaving 7
cents as surcharge revenue. The act provided that the Service was to deduct
from the surcharge revenue the reasonable costs it incurred in carrying out
the act, including those attributable to the

14 Breast Cancer Research Stamp: Millions Raised for Research, but Better
Cost Recovery Criteria Needed (GAO/ GGD- 00- 80, Apr. 28, 2000). 15 Breast
Cancer Research Stamp: Millions Raised for Research, but Better Cost
Recovery Criteria Needed (GAO/ T- GGD- 00- 137, May 25, 2000). Breast Cancer
Research

Stamp

Statement U. S. Postal Service: Sustained Attention to Challenges Remains
Critical

Page 20 GAO/ T- GGD- 00- 206

printing, sale, and distribution of the BCRS, as determined under
regulations it shall prescribe. The Service was to remit the remaining net
proceeds from the surcharge revenue to the National Institutes of Health
(NIH) and DOD for breast cancer research. Seventy percent of the net
proceeds were to go to NIH, with the remaining 30 percent to go to DOD's
medical research program.

In reviewing the BCRS, we concluded that it has been an effective
fundraiser. It has raised millions of dollars and, at the same time, has
been convenient and voluntary. In addition, the public and most of the key
stakeholders we spoke with believed it appropriate to use seimpostals issued
by the Service to raise funds for special, nonpostal purposes.

Throughout our review, however, we were concerned that the Service had not
formalized its criteria for determining what costs would be recouped from
the surcharge revenue generated by the BCRS. Additionally, we were concerned
that the Service was not consistently applying its informal criteria for
making such determinations to all costs being tracked. We recommended that
the Postmaster General promptly issue regulations that clearly state the
Service's criteria for determining which costs are to be recouped from the
BCRS surcharge revenue and ensure that the criteria are consistently applied
to all costs. In response to that recommendation, the Service recently
issued regulations formalizing its criteria for making the required
reasonable cost determinations associated with the BCRS.

In July 2000, Congress expressed its satisfaction with the BCRS by sending
legislation to the President to extend the BCRS sales period for 2 years and
grant the Service the authority to issue semipostals. The President signed
that legislation into law on July 28, 2000 (Public Law No. 106- 253). As of
July 28, 2000, the Service reported that the BCRS had raised about $15
million for breast cancer research.

In November 1999, we reported on Service changes to improve acceptance
controls for business mail. 16 We did this work to determine whether the
Service had made changes we recommended in 1996 and whether those changes
were working. 17

16 U. S. Postal Service: Changes Made to Improve Acceptance Controls for
Business Mail (GAO/ GGD- 0031, Nov. 9, 1999). 17 U. S. Postal Service:
Stronger Mail Acceptance Controls Could Help Prevent Revenue Losses (GAO/
GGD- 96- 126, June 25, 1996). Acceptance Controls for

Business Mail

Statement U. S. Postal Service: Sustained Attention to Challenges Remains
Critical

Page 21 GAO/ T- GGD- 00- 206

The Service discounts postage rates to customers who barcode and presort
their business mail before submitting it in bulk quantities to the Service
for acceptance processing. The discounted postage rates compensate customers
for performing work that otherwise would have to be done by the Service and
recognize the Service's lower cost of processing such mail on automated
equipment.

We reported in June 1996 that the Service did not have adequate controls
over the acceptance of business mail. The Service could not ensure that
customers had properly prepared their business mail and were therefore
eligible to receive the discounted postage rates. As a result, the Service
did not have reasonable assurance that all significant amounts of revenue
due from bulk business mailings were correctly identified and received.

Our follow- up review found that the Service had made changes to its
controls over the acceptance of business mail that were generally in line
with the recommendations we made in 1996 and that should help prevent
revenue losses. For example, the Service (1) developed and implemented a
risk- based approach for verifying the eligibility of high- risk customers
to receive discounted postage rates and (2) made changes to its presort
verification, supervisory review, and documentation requirements to help
provide more assurance that these functions are performed.

Notwithstanding these actions, however, we could not determine whether all
of the changes were working servicewide because data needed to make such a
determination were not available. Further, we found evidence that
supervisory reviews of revised business mail acceptance procedures were not
always performed at the locations we visited. The Inspection Service also
found that required verifications were performed properly at some locations
but not at others, and that business mail acceptance- unit employees needed
additional training at some locations but not at others. We concluded that
there was sufficient evidence that the Service still did not have assurance
that supervisory reviews of required mail verifications are performed. In
addition, we stated that the Service had not fully addressed our
recommendation that it develop information for evaluating the adequacy of
its business mail acceptance controls.

We recommended that the Postmaster General direct Service officials to
develop and implement approaches for providing reasonable assurance that (1)
required supervisory reviews of presort verifications are done and (2)
business mail acceptance controls are working as intended to prevent
improperly prepared mailings from entering the mail stream at reduced
postage rates and to minimize the rework required by the Service to

Statement U. S. Postal Service: Sustained Attention to Challenges Remains
Critical

Page 22 GAO/ T- GGD- 00- 206

correctly process and deliver such mail. In response to our recommendations,
the Service told us that it has implemented a servicewide reporting
requirement each accounting period on the number of supervisory reviews of
presort verifications conducted and developed a number of tools and
acceptance control procedures that will allow the Service to help mailers
achieve a consistently high level of presort accuracy for their mailings.

While we are encouraged by the Service's ongoing efforts to improve its
controls over business mail acceptance, we remain concerned by continuing
problems. For example, the Postal Service's Office of the Inspector General
(OIG) recently conducted an audit to determine the validity of mailers'
concerns about the identification, adjudication, and collection of revenue
deficiencies. Among other things, OIG reported that mail acceptance
personnel were not fully knowledgeable of overly complex rate standards, and
that the Service lacked a comprehensive management information system for
the revenue assurance process, reliable revenue deficiency data, and
thresholds for assessing deficiencies.

We believe that postal management must, for the foreseeable future, remain
vigilant in monitoring and maintaining the controls over all facets of
business mail acceptance. As we noted in our November 1999 report, in fiscal
year 1998, business mail accounted for 49 percent of the Service's $58
billion in total mail revenue and 66 percent of the nearly 200 billion mail
pieces handled by the Service. Accurately determining and collecting postage
for business mail are critical to the overall financial health of the
Service.

In January 2000, we reported on the Department of State's implementation of
its international postal responsibilities. 18 Public Law 105- 277, enacted
October 21, 1998, amended 39 U. S. C. 407 to give the Department of State
primary responsibility for the formulation, coordination, and oversight of
policy regarding United States' participation in the Universal Postal Union
(UPU). The UPU is a specialized agency of the United Nations that governs
international postal service. The major changes resulting from the 1998 act
that related to the UPU included (1) transferring primary responsibility for
U. S. policy regarding the UPU from the Service to the Department of State
and (2) requiring the Department of State and the Service to consult with
private providers and users of international postal services, the general
public, and such federal agencies and other persons

18 Postal Issues: The Department of State's Implementation of Its
International Postal Responsibilities (GAO/ GGD- 00- 40, Jan. 31, 2000). The
Department of State's

International Postal Responsibilities

Statement U. S. Postal Service: Sustained Attention to Challenges Remains
Critical

Page 23 GAO/ T- GGD- 00- 206

that each considers appropriate in carrying out its respective international
postal responsibilities.

In our report, and in subsequent testimony before the Subcommittee, 19 we
noted that the Department of State had made progress in implementing its UPU
responsibilities by taking steps to consult with the Service, other federal
agencies, postal users, private providers of international postal services,
and the general public. We also recognized the progress made by State in its
first year of responsibility for UPU matters and identified opportunities
for the Department to improve its process for developing U. S. policy on
these matters and the institutional continuity and expertise of its staff
working in this area. We identified some shortcomings relating to the timing
and notification for public meetings, and the distribution of documents
discussed at these meetings, that may have limited the opportunities for
stakeholders to provide meaningful input. We also found that State's policy
development process on UPU matters resulted in little public record of
agency or stakeholder positions, which could make it difficult for Congress
and others to fully understand the basis for U. S. policy positions.
Further, staff turnover made it more difficult for State to develop the
institutional continuity and expertise to fulfill its leadership
responsibilities.

We made recommendations to State that addressed these areas. The Department
of State has since reported that it has taken a number of specific actions
to address the procedural shortcomings we identified. We agree that the
Department of State has improved the timeliness and accessibility of
information it provides and its efforts to solicit input from interested
stakeholders.

Next, Mr. Chairman, I would like to discuss our ongoing Postal Service work
on supervisory pay differentials. At your request, Mr. Chairman, we have
begun a review of the complaints, primarily from postmasters, that many of
the employees they supervise earn more than they do. Our primary objective
is to determine whether any employees earn more than their postmasters do
and, if so, why (e. g., overtime, shift differential, etc.). As you know,
current Service policy calls for certain postmasters and other postal
supervisors to be paid at a higher salary rate than they might otherwise be
entitled to if they supervise two or more full- time equivalent craft
employees. Because the supervisory pay policy is relevant to the broader
concerns addressed in Congresswoman Morella's Bill (H. R. 3842,

19 Postal Issues: The Department of State's International Postal
Responsibilities (GAO/ T- GGD- 00- 63, Mar. 9, 2000). Supervisory Pay

Differentials

Statement U. S. Postal Service: Sustained Attention to Challenges Remains
Critical

Page 24 GAO/ T- GGD- 00- 206

the “Postmasters Fairness and Rights Act),” we agreed with your
office to limit our initial review to postmasters and analyze the pay for
other postal supervisors in a subsequent review. Due to the Service payroll
system's complexity, size, and lack of documentation, our analysis of
postmaster pay has taken longer than anticipated. We have been working with
the Service's payroll system officials and expect to resolve these problems
shortly and begin our analysis of postmaster pay.

Mr. Chairman, this concludes my prepared statement. I have included a list
of our Postal Service products issued since October 1999 in the attachment.
I would be pleased to respond to any questions you or the Members of the
Subcommittee may have.

Contact and Acknowledgments

For further information regarding this testimony, please contact Bernard L.
Ungar, Director of Government Business Operations, on (202) 512- 8387.
Individuals making key contributions to this testimony included Teresa L.
Anderson, Kenneth E. John, Charles F. Wicker, and Hazel J. Bailey.

Attachment GAO Postal- Related Products Issued During Fiscal Year 2000

Page 25 GAO/ T- GGD- 00- 206

U. S. Postal Service: Enhancements Needed In Performance Planning and
Reporting (GAO/ GGD- 00- 207, Sept. 19, 2000).

U. S. Postal Service: Electronic Commerce Activities and Legal Matters (GAO/
T- GGD- 00- 195, Sept. 7, 2000).

U. S. Postal Service: Postal Activities and Laws Related to Electronic
Commerce (GAO/ GGD- 00- 188, Sept. 7, 2000).

U. S. Postal Service: Diversity in District Management- Level Positions
(GAO/ GGD- 00- 142, June 30, 2000).

Breast Cancer Research Stamp: Millions Raised for Research, but Better Cost
Recovery Criteria Needed (GAO/ T- GGD- 00- 137, May 25, 2000).

Breast Cancer Research Stamp: Millions Raised, but Better Cost Recovery
Criteria Needed (GAO/ GGD- 00- 80, Apr. 28, 2000).

U. S. Postal Service: Diversity in the Postal Career Executive Service (GAO/
GGD- 00- 76, Mar. 30, 2000).

Postal Issues: The Department of State's International Postal
Responsibilities (GAO/ T- GGD- 00- 63, Mar. 9, 2000).

Postal Issues: The Department of State's Implementation of Its International
Postal Responsibilities (GAO/ GGD- 00- 40, Jan. 31, 2000).

U. S. Postal Service: Changes Made to Improve Acceptance Controls for
Business Mail (GAO/ GGD- 00- 31, Nov. 9, 1999).

Page 26 GAO/ T- GGD- 00- 206

Page 27 GAO/ T- GGD- 00- 206

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