USPS regulator says DeJoy should pause all network reform efforts

The U.S. Postal Service’s regulator is calling on the mailing agency to pause all of the reform efforts it is currently undertaking, marking the first time it has formally issued such a recommendation and yet another escalation in the feud between the two entities. 

The Postal Regulatory Commission expressed concern that postal management is moving forward with its plan to many aspects of its plan to consolidate mail sorting and processing despite the difficulties it has experienced rolling out those changes to date. It said the network changes should not continue until USPS can further study the impacts of the efforts. While the suggestions to not carry any obligation for the Postal Service, they continue the pressure Postmaster General Louis DeJoy has faced as he continues to implement his vision to overhaul the agency. 

DeJoy announced earlier this year he would pause the moving of mail processing facilities until at least 2025, which followed bipartisan blowback from lawmakers in both chambers of Congress. He is proceeding with the establishment of some of his new regional processing centers and the “sorting and delivery centers” where letter carriers will report to pick up the mail each day, however, leading to PRC’s recommendation. DeJoy is overseeing the changes as part of his 10-year Delivering for America plan to improve USPS operations.

In an analysis of the Postal Service’s fiscal 2023 performance and its fiscal 2024 plan, PRC said the agency should “pause other DFA plan initiatives in addition to moving mail processing facilities, so that it can conduct a comprehensive study of the DFA plan’s potential impacts on service performance.” 

The commission made its recommendation after finding in the report that USPS in fiscal 2023 missed most of its goals for high-quality service performance; three of its eight goals related to customer service; and all of its goals related to maintaining a safe workplace, engaged workforce and financially healthy organization. 

DeJoy and PRC have been at odds for years, as the postmaster general has accused the regulators—and other stakeholders—of standing in the way of essential steps he must take to save the agency from insolvency. The new recommendation, however, marks the first time PRC has called for a pause to DeJoy’s signature plan. It follows the introduction of bipartisan bills that would restrict the Postal Service from carrying out its changes. 

In a recently introduced fiscal 2025 spending bill, House Republicans said they were “deeply concerned about the potential negative impacts” of DeJoy’s reforms. 

PRC flagged other aspects of DeJoy’s plan, including suggesting USPS consider whether its decision in recent years to increase prices twice annually “may accelerate electronic diversion resulting in adverse volume effects.” While postal officials have repeatedly highlighted its efforts to engage with its customers and employees over its plans, the commission said it has concerns about the “limited transparency” regarding the DFA and their “effects on service performance.” PRC recently pushed back on DeJoy’s rate increase strategy, saying postal management should exercise more discretion before continuing with its approach that “may be unprecedented in the history of the Postal Service.”

Many lawmakers and stakeholders across the postal community are imploring PRC to go further, calling for it to issue an “advisory opinion” on the totality of DeJoy’s DFA plan. 

Large-scale mailers and others that interact with the Postal Service regularly are hopeful an advisory opinion—while not enforceable—would provide a third-party assessment of the agency’s plans, evaluate its assumptions and potentially offer additional fodder to motivate either the USPS board of governors or Congress to intervene.