Post Office May Close Offices to Save Money

July 25, 2011 - 7:29 PM

WASHINGTON (AP) — The Postal Service is launching a study of thousands of local post offices for possible closure in an effort to save money.

The cash-strapped agency, which lost $8 billion last year, scheduled a briefing for Tuesday at which it is expected to announce the action.

Most of the approximately 3,600 offices that face reviews are in rural areas, but postal official say they are looking into alternate service, such as locating offices in local businesses, town halls or community centers.

In those cases the so-called Village Post Office would replace one to be closed.

And coming under review doesn't necessarily mean an office will close. The post office announced in January it was reviewing 1,400 offices for closing. So far 280 have been closed and 200 have finished the review process and will remain open.

Once an office is selected for a review, people served by that office will have 60 days to file their comments and, if an office is to be closed, they will be able to appeal to the independent Postal Regulatory Commission.

The post office has been struggling to cope with the loss of first-class mail to the Internet at the same time a lot of advertising mail declined because of the recession. Last year an estimated 50 percent of bills were paid by Internet rather than the mail, up from 5 percent a decade earlier.

In addition to closing offices the Postal Service has sharply reduced its staff over the last several years and cut billions from its costs. It has also asked Congress to allow it to cut back to delivery five-days-a-week and to ease the requirement for an annual $5.5 billion payment to fund future retiree health benefits.

Currently the post office operates more than 31,000 local offices, branches and stations, down from 38,000 a decade ago.

Of the 1,400 offices announced for review in January, 620 are still in the review process and 300 will move to the new review list.