REMARKS OF JOHN E. POTTER
POSTMASTER GENERAL AND CEO OF THE U.S. POSTAL SERVICE
NATIONAL POSTAL CUSTOMER COUNCIL DAY
SEPT. 17, 2008

Please note: Mr. Potter may deviate from the prepared remarks

Thank to all of you for taking time out from your busy schedules to join us today.

I’d like to congratulate St. Louis on their selection as PCC of the year and thank them for hosting this year’s national event.

Before we get down to business our thoughts and prayers go out to those whose lives have been disrupted by Hurricane Ike - all the way from the gulf right up through the Midwest. For some, the effects will be short lived-for others the road to recovery will be a much longer journey.

My congratulations to Pat Donahoe and his postal team for their constant communication as the storm moved ashore and for quickly reopening facilities and delivering mail when safe conditions allow.

You can count on us to do our small part to help bring a sense of normalcy back to the affected areas.
Read the rest of this entry »

Postmaster General John E. Potter challenged the mailing industry today, cautioning mailers about the severity of the current economic climate and urging them to create new growth opportunities.

Citing fluctuating oil prices, inflation in paper prices and the strife in the financial markets, Potter described challenging economic conditions as the most difficult time since the 1960s. The additional move of hardcopy messages to the Internet and questions about mail’s environmental impact have led to a volume decline of 9 billion pieces this year.

Despite the tough times, Potter called on the mailing industry to seek new sources of growth.

“We have to approach the business in a whole new way,” Potter said. “We have to develop new ways for the American people and American business to use the mail.”

Despite the challenges ahead, Potter remains confident in the strength and commitment of the Postal Service and the mailing industry as a whole.

“Once the economic storm passes, our industry will rebound,” Potter told the audience of 14,000 PCC members. “If we remain focused on the fundamentals of our industry and if we reach out to new audiences, we will again reach new heights.”

The Postmaster General’s comments came during the national Postal Customer Council (PCC) Day broadcast, an annual event that brings mailers, industry partners and customers together to recognize their contributions to the Postal Service and outline future plans and goals.

One of these goals is to continue to improve record-setting levels of service. Working with the mailing industry and the Postal Regulatory Commission, the Postal Service has developed a new set of modern service standards for each class of mail and will begin measuring performance against these standards this year. In addition, improvements in customer satisfaction, scan rates, network effectiveness and the Postal Service’s website, usps.com, will be top priorities moving forward, Potter said.

“Service is what we’re all about. It is our franchise, the very reason for our existence,” he said.

Potter also called on the mailing industry to adapt to the changing marketplace and invest in the future. The Intelligent Mail Barcode is one way the Postal Service is leveraging technology to provide greater value and ease to business mailers, he said. Storing three times the amount of data of the current barcodes, the Intelligent Mail Barcode helps customers manage mail flow by uniquely identifying every piece in a mailing. The technology allows mailers to sort, track and receive address correction, all from one barcode.

Affordable prices that deliver value are a key element to retain and grow business, Potter said. The agency has reduced costs $1 billion or more for each of the past seven years and, through creative business solutions, absorbed the $700 million rise in fuel costs last year so that these costs were not passed on to customers as fuel surcharges.

“The price you see is the price you pay,” Potter said.

Reduction in costs alone will not be enough to overcome difficult economic times, he said, identifying several opportunities for growth through innovative new products, including a new, large Priority Mail Flat Rate Box and using the mail for recycling and product take-back programs.

Potter took a moment in the broadcast to recognize the recent devastation caused by Hurricane Ike and pledged the Postal Service’s continued support to victims in the areas affected by the storm, acknowledging the organization’s role to “bring a sense of normalcy” to the affected areas.

The Postal Customer Council (PCC) is a network of community-based business mailers and representatives of the U.S. Postal Service, who gather regularly to share ideas and resources to create a closer working relationship. On both the national and local levels, PCCs work to improve service and communications.

To help keep the lines of communication open, the Postal Service has launched the first official postal blog at 2blogPCC.com. Customers can discuss important topics facing the mailing industry, access the latest information and provide feedback.

National PCC Day also showcases the work of PCCs and includes a series of awards recognizing outstanding service and individual achievement. The following award winners were announced:

* PCC Industry Member of the Year: Peggy Smith, Co-Chair, Greater St. Louis.
* PCC Postal Service Member of the Year: Victor Laudisio, Customer Relations Coordinator, Buffalo/Niagara.
* PCC of the Year: A tie! Buffalo/Niagara and Greater New York (large market) and Capital Region (small market).
* PCC District Manager of the Year: Charles Howe, Greater Michigan District.
* Communication Program Excellence: Greater New York and Capital Region (gold), Buffalo/Niagara and Greater Dallas (silver) and Fort Worth and West Michigan (bronze).
* Education Program Excellence: Capital Region and Greater New York (gold), Buffalo/Niagara and Greater Atlanta (silver) and Greater Cleveland (bronze).

More information on Postal Customer Councils and National PCC Day can be found at usps.com/nationalpcc.

The US Postal Service reported a net loss of about $960 million in August, according to reports filed with the Postal Regulatory Commission. That brings the year to date deficit to $2.3 billion with one month left in the fiscal year. While year to date revenue is still slightly above the same period last year, revenue for the month of August was about ten percent below August 2007 in spite of a 2.9% price increase implemented in May.

More details on the postal service’s financial situation will likely be released during next week’s meeting of the USPS Board of Governors.

Press release:

A federal grand jury in Louisville returned an indictment against Mary Jo Terry, age 50, of Louisville, Kentucky, in Jefferson County, on charges of Misappropriation of Postal Funds, U.S. Attorney David L. Huber of the Western District of Kentucky announced today.

The Indictment alleges that between January of 2007 and June of 2008, Terry stole money for her own use that belonged to the United States Postal Service Air Mail facility where she was employed.

In the event of a conviction, the maximum potential penalties are 10 years imprisonment, a $250,000 fine, and supervised release for a period of 3 years.

The case is being prosecuted by Assistant United States Attorney Joshua Judd, and it was investigated by the United States Postal Service, Office of the Inspector General.

Press release:

Today, Congressman Chris Murphy (CT-5) released a letter he sent to Frank Marshall, Acting District Manager for the United States Postal Service to get answers for Meriden residents about how the Postal Service is going to resolve the mail delivery delays in the city caused by the recent elimination of eight routes.

“Individuals and businesses rely on the United States Postal Service; they expect to receive their bills, paychecks, and other important packages in a timely manner. The Postal Service’s sudden change in service begs not only explanation, but a solution,” said Murphy.

Murphy has received calls into his office about the situation. Many of those affected by the route changes are senior citizens, who are waiting until the late evening for their mail to arrive.

Minor adjustments to the routes have not remedied the delays. As a result, Murphy has asked the United States Postal Service detail how the routes are being improved to provide better customer service.

“I don’t think it’s too much to ask that the Postal Service deliver for their customers, the residents of Meriden, before they go to bed every night,” said Murphy.

Postmaster General Jack Potter today announced the appointment of Jim Cochrane as Vice President of Ground Shipping and Mitzi Betman as Vice President of Corporate Communications.

“Both have been acting in their respective positions for several months, and each has done an outstanding job during that time,” Potter said.

As Vice President of Ground Shipping, Cochrane is responsible for developing products and programs that will improve profitability and customer value while leveraging pricing freedoms made possible by the Postal Act of 2006.

“Jim’s previous experience as Manager of Package Services, Product Development, and his Sales background uniquely position him to understand customers’ needs in this market. His extensive prior experience in operations including Manager of the Capital District will be beneficial in developing customer solutions that align with operational capabilities ensuring efficiency, world-class service and profits,” said Potter.

Cochrane is a graduate of American University with a master of public administration from the School of Public Affairs. He reports to Shipping and Mailing Services President Robert Bernstock.

As Vice President, Corporate Communications, Betman is responsible for all internal and external communications for the Postal Service, including media relations, design and brand equity, video production and photography, speechwriting and community relations.

Betman most recently served as Director, Operations Planning and Strategies, in the office of the Deputy PMG and Chief Operating Officer. There she performed the duties of chief of staff and principal executive for implementation and coordination of national postal operations plans and strategies.

“Mitzi’s strong operational, field, and corporate experience, and connection with our customer base, lend themselves well to shaping our corporate messages internally and externally,” Potter said.

Mitzi holds a bachelor of science degree in business management from the University of Maryland University College and a master of public administration degree from American University. She reports to Customer Relations Senior Vice President Stephen Kearney.

According to the Stamford Advocate:

Stamford-based Pitney Bowes Inc., the world's largest maker of postal meters, said U.S. mail volumes have remained "relatively steady" as individuals send fewer letters and packages.

Business and direct-marketing mail has grown, offsetting a 4 percent decline in first-class mail, Chief Executive Officer Murray Martin said at an investor conference in New York Wednesday. Electronic mail, including digital versions of bills and financial statements, hasn't hurt volume, he said.

"The segments we participate in have had steady to growing mail volumes," Martin said. "Electronic solutions are still a very, very low percentage."

Martin said he expects the U.S. mailing business to rebound next year from declines this year as equipment leases come up for renewal.

The company issued the following press release:

Pitney Bowes Inc. (NYSE:PBI) told an audience of financial analysts and institutional investors today that its diversification strategies have brought significant benefits to both customers and investors. The company also provided fresh perspectives on growth plans for its major lines of business worldwide.

In his remarks, President and CEO Murray Martin noted that the company has changed in several significant ways in recent years, citing especially a geographic expansion that has nearly tripled international revenues since 2000, and an expansion of products and services beyond Pitney Bowes’s core mailing business that has enabled a much richer suite of offerings to customers.

“Our systematic expansion beyond our historic niche of mail evidencing enables us to meet more of the customer’s end-to-end needs,” Martin said. “This keeps the customer connected on topics that matter to them and helps Pitney Bowes build longer-term relationships.”

Martin noted that the addition of several new and rapidly-growing lines of business through acquisition has reduced mail and related hardware to just 54% of total annual revenues, down from 75% just seven years ago. “Our focus of delivering value has evolved from office equipment to mail, from mail to mailstream, and now from mailstream to connections with customers around what matters in the mailstream,” Martin said.

Chief Financial Officer Mike Monahan provided a detailed review of the company’s operating units and their long-term potential for revenue and profitability. Taken together, Monahan said, the company is positioned to deliver a total return to shareholders of 11-13% per year. This estimate assumes an organic revenue growth rate of 3-5%, improved operating profit margins, continued share repurchases, and a dividend yield of approximately 3%, which is close to Pitney Bowes’s long-term historical average.

In addition to the presentations from Martin and Monahan, the company provided demonstrations of many of the new technologies and services it offers. These included location intelligence software that assists marketers in a range of industries make more informed decisions; new systems that add customized marketing messages to bills and statements; and services that help companies take advantage of the rich trove of information provided by the U.S. Postal Service’s Intelligent Mail® barcode.

In response to a request by the Senate Committee on Homeland Security and Governmental Affairs Committee, the Government Accountability Office (GAO), has suggested changes to the USPS Pay for Performance program, or PFP. PFP determines the annual salary increase for EAS and PCES managers, who do not receive the cost of living and “step” increases added to bargaining unit employees salaries.

The GAO’s key recommendation was that the USPS add new delivery performance indicators to PFP, since the existing delivery indicators (EXFC, etc.), “apply to less than one-fifth of mail volume”.

The GAO found that in the existing PFP program

Corporate and unit indicators related to three strategic goals in USPS’s updated Strategic Transformation Plan3—increasing efficiency, improving service, and generating revenues—collectively account for two-thirds of the average participant’s rating. More specifically, results for efficiency-related indicators, such as USPS’s overall productivity and unit expenses, account for 27 percent of the average participant’s PFP rating; results for service-related indicators, such as the timeliness of delivery for certain types of mail, represent 22 percent of the average rating; and results for revenue-generation indicators, such as national and unit revenues, account for 17 percent of the average rating. However, the weight of PFP indicators varies considerably by participant group, based on the responsibilities and spans of control of various managerial and executive positions.

The report noted that

USPS is in the process of implementing required measurement of delivery performance for market-dominant mail, including new delivery performance measurement systems for mail that is not being measured—such as Standard Mail, bulk First-Class Mail, and Periodicals.4 Together, these three mail types constitute 78 percent of mail volume, including 49 percent for Standard Mail, 25 percent for bulk First-Class Mail, and 4 percent for Periodicals. USPS has recognized that the successful implementation of these new measurement systems will depend, in part, on actions by mailers. USPS expects these actions—including barcoding mail and containers, as well as providing electronic information on mailings—to become more widespread over the next several years. Once the new delivery performance measurement systems are fully implemented and mailers’ participation is sufficient to generate representative data, USPS will have the opportunity to incorporate new delivery performance indicators into its PFP program.

The report also included charts showing the average annual salary increases or lump sum payments earned by participants since the program began in 2003. (Employees whose salary increase would exceed the upper limit of their salary range receive a lump sum payment.) Interestingly, although the goals for executives on the one hand, and managers and supervisors on the other are drawn from the same basket of indicators, executives receive far higher PFP payments. In the first year, 2003, PCES excutives received an average PFP payment (combining increases and lump sums) of 12.7%, while lower level managers and supervisors received 6.5%. Last year, the average PFP for executives was 7.9%, for managers and supervisors 5.2%.

Average Annual PFP Increases for PCES executives

Average annual PFP increases for EAS managers and supervisors

GAO: New Delivery Performance Measures Could Enhance Managers’ Pay for Performance Program

NELS T. BECK,
Petitioner,
v.
UNITED STATES POSTAL SERVICE,
Respondent.
Petition for review of the Merit Systems Protection Board in
CH0752070525-I-1

DECIDED: September 9, 2008

Before RADER, CLEVENGER, and DYK, Circuit Judges.
PER CURIAM.

Nels T. Beck seeks review of the final decision of the Merit Systems Protection Board (“Board”) sustaining the decision of the United States Postal Service (“agency”) to remove him from his position of Rural Carrier at the agency’s Waterloo, Iowa facility. Beck v. U.S. Postal Service, No. CH0752070525-I-1 (January 24, 2008). We affirm.

I

Mr. Beck was involved in an automobile accident on February 12, 2007, while delivering mail on his rural route. Mr. Beck ran a stop sign and hit a vehicle driving through the intersection. The driver of the other vehicle was thrown from it, and the passenger had to be pried out by the fire department. Mr. Beck was injured.

The agency proposed his removal as a result of his negligent driving which resulted in the accident. Mr. Beck did not contest the fact that he had caused the accident. He argued for mitigation of the penalty to something less than removal. The agency’s deciding official considered the Douglas factors in assessing Mr. Beck’s request for mitigation. The deciding official rejected Mr. Beck’s argument that he was not to blame for the accident, due to his driving a substitute vehicle with which he was not familiar, and the light conditions which he asserted kept him from recognizing the ice upon which he was driving. Because the offense was serious, and because Mr. Beck had previously been disciplined for unsafe driving, the agency determined that removal was the appropriate penalty. No lesser penalty would be proper, as there was no indication that some other sanction would deter such unsafe acts in the future.

II

Mr. Beck appealed his removal to the Board. The administrative judge assigned to his case held a hearing at which Mr. Beck and the deciding official testified. Mr. Beck did not deny that he failed to observe safe driving practices. He repeated his reasons for a lesser penalty. The administrative judge found convincing the testimony of the deciding official that Mr. Beck posed a distinct liability to the agency, and was not a good candidate for rehabilitation. The administrative judge reviewed the deciding official’s assessment of the Douglas factors and concluded that the agency had demonstrated that removal was appropriate.

Mr. Beck sought review of the administrative judge’s initial decision by the full Board. The full Board declined his petition for review, and Mr. Beck timely sought review in this court.

III

We must affirm the final decision of the Board unless we determine that it is arbitrary, capricious, an abuse of discretion or otherwise unlawful. 5 U.S.C. § 7703(c). When the final decision of the Board rests on findings of fact, we review those findings for substantial evidence.

In this case, there is no dispute as to the facts. Mr. Beck repeats his contention that removal was an excessive penalty, and he argues that his previous discipline for unsafe driving should not be considered in assessing the penalty for the February 2007 collision because that discipline was under grievance procedures when the deciding official proposed his removal.

On the propriety of the removal penalty, the issue boils down to whether the deciding official’s assessment of the Douglas factors amounts to reversible error. We perceive no error in the agency’s decision to remove Mr. Beck. Furthermore, we find no error in the agency’s reference to his earlier unsafe driving event. The Supreme Court has ruled that when considering the appropriate penalty for an offense, an agency may refer to other previous disciplined offenses even though they are under grievance when the agency is considering the appropriate penalty. Gregory v. U.S. Postal Serv., 534 U.S. 1 (2001).

Because the Board’s decision is not arbitrary, capricious, an abuse of discretion, or otherwise unlawful, we affirm.

In upstate New York, the trial of a man accused of murdering his wife was delayed by an auto accident. During the delay, the judge learned he might have another problem:

Before adjourning Thursday, Smith and the attorneys discussed a couple of potential problems involving jurors. One, employed by the U.S. Postal Service, has a supervisor who considers the juror too valuable to leave work.

“Did she suggest that because you're so indispensable, she'll give you a substantial raise?'' Smith asked the juror.

The juror said no, and the judge said he would call the postal supervisor and apprise her of the importance of jury service.

The Daily Star, Oneonta, NY - Wlasiuk retrial delayed after family car crash.