Saturday, July 26, 2014

Amid financial woes, US Postal Service continues plans to close Scranton distribution hub

June 30. 2014 11:38PM
By Jon O’Connell

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Ironically, news that the United States Postal Service is continuing plans to consolidate processing centers nationwide, including one in Scranton, arrived by email.

Citing massive ongoing financial losses — borne of, among other things, diminishing First Class postage revenue — the Postal Service said Monday in a news release it will commence a second phase of consolidation efforts transferring work from 82 processing and distribution centers to other centers.

Due to declining revenue and rising operating costs including wage/benefit inflation, equipment upkeep and transportation, the Postal Service has been conducting sweeping overhauls in efforts to streamline its operations and sustain itself.

Work completed at the Stafford Avenue Distribution and Processing Center in Scranton, which includes processing mail before it is sent to local post offices for delivery, is to be moved to a Lehigh Valley center, one that already has assumed operations from the northeast region as part of the consolidation.

Mail collection for zip codes beginning with numbers 180 through 188 had been transferred to the Lehigh Valley center last February.

The nationwide changes are slated to begin in January and are to be completed by next fall.

The Postal Service reports a $26 billion revenue loss over the last three years. The consolidation is to cut costs annually by $750 million. Streamlining efforts already made have produced savings to the tune of $865 million annually. The Postal Service expects to see the savings from second-phase changes total $3.5 billion over five years.

The Postal Service is a federal agency, but it receives no federal funding. It survives solely on postage revenue.

Changes to affect service speed and cost? Likely not, the agency says.

The agency plans no postage rate increase due to consolidation and time expected to deliver first-class parcels increases only by a few hours.

Even during inclement weather, the consolidations have been mapped in such a way that storms shouldn’t hamper regular service, the agency says.

While it pledges to honor contracts with the United Postal Workers Union, the agency is looking to reduce its workforce through attrition.

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