oversight

Need To Recover the Costs of Processing Business Reply Mail

Published by the Government Accountability Office on 1971-10-28.

Below is a raw (and likely hideous) rendition of the original report. (PDF)

REPORT TO THE CONGRESS^


                               IlliilsiilSlllIIIlllllllllllllllllll
                                     LM095493




Need To Recover The Costs Of
Processing Business Reply M’ail
                                      e-114874



United States Postal Service




BY THE COMPTROLLER GENERAL
OF THE UNITED STATES
                                                                        ,
                                                         l          .       *




                   COMt’TROLLfRqGEJ-tERAL                OF         THE             UNITED       STATES
                                      WASHINGTON.            D.C.               20548




    B-114874




     To the President     of the Senate and the
i: 1 Speaker of the House of Representatives
 /
           This is our report     on the need for the United
     States Postal    Service   to recover the costs of proc-
     essing business    reply mail.
          Our review was made pursuant     to the Budget and
    Accounting     Act, 1921 (31 U.S.C.  531, and the Postal
    Reorganization      Act of August 12, 1970 (39 U.S.C.
    2008)   .

           Copies of this             report     are being sent to the
    Director,     Office     of       Management and Budget;      the
    Postmaster      General;          and each member of the Postal
    Rate Commission and               the Board of Governors      of the
    United    States     Postal         Service.



                                                    Comptroller                                  General
                                                    of         the                      United       States




                           50TH ANNIVERSARY                                        1921- 1971
I   COMPTROLLER GENERAL'S                         NEED TO RECOVER THE COSTS OF
    REPORT TO THE CONGRESS                        PROCESSING BUSINESS REPLY KAIL
                                                  United States Postal Service   ,L
I                                             '   B-114874
I

    DIGEST
    ------
    WHY THE REVIEW WAS MADE
             Although  the Congress intended    that fees charged for
             business  reply mail service    be adequate  for recovering
             the cost of providing   this service,    the fees have not
             been changed since they were established       by law in 1958.
             Because of these circumstances,     the General Accounting
I            Office   (GAO) wanted to know whether    the fees were ade-
             quate for recovering    the costs incurred   in handling
             business   reply mail.
              -.

    FINDINGS AND CONCLUSIONS
             The United States      Postal    Service   is not recovering      the
             costs of providing      business     reply   mail service.
1            GAO's review,    conducted    at 13 postal    facilities        located
I            in seven cities,     showed that the average direct             labor
I
I            cost for each piece of business       reply     mail     exceeded the
I
I
             average fee by about 0.9 cent.         In fiscal       year 1970 the
I            Postal   Service  processed    about 733 million         pieces    of
I            business   reply  mail.     (See pp. 4 and 5.)
I
I
             The Postal     Service   has not made a study of the cost of
I            providing    business    reply     mail service     since the fees were
I
I            established     in 1958.      The average annual salary        of a
I
I
             postal    employee increased        from $4,402 in fiscal      year 1957
I            to $8,224 in fiscal        year 1970, an increase         of about 87
I            percent.     A postal    official       advised   us that generally   a
I
I
             cost study would be made only when needed to rebut a
I            challenge    from business        mailers.      (See p. 6.)
I
I
I
    RECOMMENDATIONS OR SUGGESTIONS
             The Postal   Service    should determine    the nationwide       cost
             of providing   business     reply mail service     and should pro-
             pose to the Postal      Rate Commission   appropriate      adjustments
             to the fees so that the fees will        be adequate     for recov-
I            ering  the costs of providing      the service.       (See p. 9.)
I
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I
I   Tear Sheet
I                                            1
I
I
I
I
                                                                               I




AGENCY ACTIOi\JS AND UNRESOLVED ISSUES

     The Postmaster   General   stated      that the relationship        be-
     tween costs for a postal       service     and rates   for that ser-
     vice was a matter    for review by the Postal          Rate Commis-
     sion.    He said that an intervener         in a proceeding      before
     the Commission was contending          that the current      fees for     I
     business   reply mail should be reduced and that therefore                I
                                                                               I
     the issue of the proper      fees for business       reply mail was       I
     involved   in the proceeding     before     the Commission.        (See   I
                                                                               I
     p* 9.1                                                                    I
                                                                               I
     Because the Postal       Service has not compiled      information        I
                                                                               I
     on the nationwide      costs of providing      the business     reply
     mail service,    GAO   believes  that an informed      decision
     cannot be made as      to the fees that are required         to re-
     cover the cost of      providing   the service.      (See p. 9.1

MATTERS FOR CONSIDERATION BY THE CONGRESS
     This report      is to apprise    the Congress of the need for
     the Postal     Service    to determine   the cost of providing
     business    reply    mail service    and to propose   appropriate         I
     fee adjustments       to the Postal    Rate Commission.                   I
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                                                                               I
                                     2
                              Contents
                                                                    Page
DIGEST                                                                1
CHAPTER
       1   INTRODUCTION                                               3
       2   NEED TO RECOVER COSTS OF PROCESSING BUSINESS
             REPLY MAIL                                               5
               Existing 2-cent  and 5-cent      fees were in-
                 tended to recover     costs                          5
               Cost of business   reply    mail                       7
       3   AGENCY COMMENTS AND GAO EVALUATION AND
             RECOLa'IENDATIONS                                        9
               Recommendations to the Postmaster General              9
       4   SCOPE OF REVIEW                                           11

APPENDIX
       I   Letter    dated March 29, 1971, from the Post-
              master General    to the General Accounting
              Office                                                 15
  II       Principal       management officials     of the Postal
              Service      responsible   for administration    of
              activities       discussed   in this  report           16
COi%?TROLLER GENERAL'S                    NEED TO RECOVER THE COSTS OF
REPORT TO THE CONGRESS                    PROCESSING BUSINESS REPLY MAIL
                                          United   States Postal Service
                                          B-114874

DIGEST
------
WHY THE REVIEW WAS MADE
     Although  the Congress intended    that fees charged for
     business  reply mail service    be adequate  for recovering
     the cost of providing   this service,    the fees have not
     been changed since they were established       by law in 1958.
     Because of these circumstances,     the General Accounting
     Office   (GAO) wanted to know whether    the fees were ade-
     quate for recovering    the costs incurred   in handling
     business   reply mail.

FINDINGS AND CONCLUSIONS
     The United  States      Postal    Service   is not recovering       the
     costs of providing       business     reply mail service.
     GAO's review,    conducted    at 13 postal    facilities        located
     in seven cities,     showed that the average direct             labor
     cost for each piece of business        reply mail exceeded the
     average fee by about 0.9 cent.         In fiscal       year 1970 the
     Postal   Service  processed    about 733 million         pieces    of
     business   reply  mail.     (See PP- 4 and 5.)
     The Postal      Service  has not made a study of the cost of
     providing    business     reply mail        service     since the fees were
     established      in 1958.       The average annual salary          of a
     postal    employee increased         from $4,402 in fiscal         year 1957
     to $8,224 in fiscal        year 1970, an increase             of about 87
     percent.     A postal     official       advised      us that generally   a
     cost study would be made only when needed to rebut a
     challenge     from business        mailers.         (See p. 6.)

RECOMMENDATIONS OR SUGGESTIONS
     The Postal   Service    should determine    the nationwide       cost
     of providing   business     reply mail service     and should pro-
     pose to the Postal      Rate Commission   appropriate      adjustments
     to the fees so that the fees will        be adequate     for recov-
     ering  the costs of providing      the service.       (See p. 9.1~


                                      1
AGENCY ACTIONS AND UNRESOLVED ISSUES
     The Postmaster   General   stated      that the relationship        be-
     tween costs for a postal       service     and rates   for that ser-
     vice was a matter    for review by the Postal          Rate Commis-
     sion.    He said that an intervener         in a proceeding      before
     the Commission was contending          that the current      fees for
     business   reply mail should be reduced and that therefore
     the issue of the proper      fees for business       reply mail was
     involved   in the proceeding     before     the Commission.        (See
     PO 9.1
     Because the Postal    Service has not compiled     information
     on the nationwide    costs of providing    the business     reply
     mail service,    GAO believes that an informed     decision
     cannot be made as to the fees that are required          to re-
     cover the cost of providing     the service.     (See p. 9.)

MATTERS FOR CONSIDERATION BY THE CONGRESS
    This report     is to apprise    the Congress of the need for
    the Postal    Service    to determine   the cost of providing
    business   reply    mail service    and to propose appropriate
    fee adjustments      to the Postal    Rate Commission.
                                      CHAPTER 1

                                   INTRODUCTION
        The postage     on most types of mail must be prepaid                  by the
sender at the time of mailing.              Business     reply mail,         however,
may be mailed without           prepayment   of any postage by the sender.
The Postal      Service   collects     the postage      and fees on such mail
from the addressee        prior     to its delivery.        The purpose of
business     reply mail is to enable businessmen                to obtain      re-
plies    to advertising       from prospective       customers       without     re-
quiring    the customers        to pay the return      postage.         The postage
for business      reply mail consists        of either      first-class        or
airmail    postage plus a fee of 2 cents for each piece of mail
weighing     2 ounces or less or 5 cents for each piece of mail
weighing     over 2 ounces.
      The Postal       Reorganization        Act, approved August 12, 1970
(84 Stat.  719;       39 U.S.C. lOl),        which became fully   effective
July 1, 1971,       abolished    the Post Office       Department  and cre-
ated the United        States Postal       Service  and the Postal     Rate
Commission  as      independent      establishments     of the executive
branch of the       Government.
       The Commission     is responsible      for reviewing      and making
recommended decisions        on changes in postal       rates    and fees
proposed    by the Postal     Service.     The Commission      may not rec-
ommend a decision      until   all interested     parties     are granted   an
opportunity    to participate       in the rate hearings.
        Upon receipt     of the Commission'&decision,             the Board of
Governors       of the Postal    Service    may approvep    allow under pro-
test,    reject,     or modify the recommended decision.             When a
recommended decision          is allowed    under protest,      the Board puts
it into effect        and seeks judicial       review of the decision       under
section      3628 of the Postal       Reorganization    Act or returns      the
recommended decision          to the Commission      for reconsideration       and
a further       recommended decision.
        The act requires          the Postal       Service    to become self-
sustaining.          Postal    rates      and fees are required            to be set so
that all postal           revenues      (including     appropriations         that the
Congress may make for the Postal                   Service)     equal expenses,        as
nearly     as practicable.           The act prescribes           criteria      for es-
tablishing        rates and fees and includes               a requirement        that
fees for all classes             of mail and all types of mail services
recover     their      related     costs.




                                             3
        The volume of business  reply mail processed   by the Postal
Service    and related revenues   for the past 5 years are as
follows.
Fiscal        2 ounces             and under                   Over 2 ounces                               Total
 year         Pieces               Revenue                    Pieces  Revenue                    Pieces            Revenue
                                                              (000 omitted)

  1966        510,586              $10,212                    23,435          $1,172             534,021           $11,383
 1967         697,618               13,952                    23,078           1,154             720,696            15,106
 1968         645,179               12,904                    23,815              1,191          668,994            14,094
 1969         651,235               13,025                    23,161              1,158          674,396            14,183
 1970         707,253               14,145                    26,103              1,305          733,356            15,450

The Postal   Service  has not                            developed                data        showing      the     cost    of
providing  this service.
        Permits    to          distribute      business    reply mail are granted
without     charge           to any individual,         business,    or organization
upon receipt       of          an application        by the local    post office.       The
Postal    Service            has no minimum mail-volume           requirements      which
must be met to               obtain      or retain    a business    reply  permit.      The
distributor        of        the        business              reply        mail       must      guarantee          payment
of postage   and fees                    for all such mail                           returned.          A sample          of
business   x&ply mail                    is shown below.




                        NO    POSTAGE     STAMP   NECESSARY      IF MAI


                                         POSTAGE              WILL        BE PAID        BY


                                                        John Smith
                                                        Box9
                                                        Home City,           State
                                                        00000




                                                                 4
                                    CHAPTER     2


                  NEED TO RECOVER COSTS OF PROCESSING

                             BUSINESS     REPLY MAIL

        The fees establish&d       by the Congress in 1958 were in-
tended to recover       the costs of providing         business     reply mail
service.      This service     consists     of accepting     mail without
prepayment     of postage;     detecting      and separating     business
reply    mail from other mail:         determining,    and establishing
accounting     controls    over,   the postage      and fees due; and col-
lecting    the amounts due.
        Our review indicated        that,  because personnel    costs had
increased     significantly      from the time that the fees were
established      and because there had been no corresponding            in-
creases     in the fees,    the Postal     Service   was not recovering
the cost of providing         the business     reply mail service.
        During test periods      in fiscal      years 1969 and 1970 (see
scope of review,       p. ll),   we reviewed       the processing        of
160,483 pieces       of business     reply mail at 13 postal           facilities
located     in seven cities.       At these facilities           the fees col-
lected    averaged    about 2.1 cents a piece,           or about 0.9 cent a
piece less than our estimate            of direct     labor cost of about
3 cents a piece to provide           the service.        According     to Postal
Service     data,  the average fee collected            nationwide    was      about
2.1 cents a piece during         fiscal    years 1969 and 1970.
       We   believe     that the Postal       Service   should determine      the
costs of      providing     business    reply mail     service    and should
propose     to the Postal        Rate Commission      appropriate     fee changes
so that     the fees will       be adequate     for recovering      the costs
incurred      in providing       the service.
EXISTING  2-CENT AND 5-CENT FEES
WERE INTENDED TO RECOVER COSTS

      The act of July 25, 1958 C72 Stat. 420) established      fees
for business  reply mail of 2 cents for each piece weighing
2 ounces or less and 5 cents for each piece weighing      over
2 ounces.
      During a hearing          on January     28, 1958, before      the Commit-
tee on Post Office          and Civil    Service,    House of Representatives,
in connection        with the enactment        of the act of July 25, 1958,
a postal    official      stated   that,   based on fiscal      year 1957 cost
data,   the estimated        cost of determining       and collecting     postage



                                          5
due on each piece   of business   reply     mail weighing                                less   than
1 ounce was 2 cents    and the cost     for each piece                              of     such mail
weighing  more than   1 ounce was 5.18 cents.

          The postal        official         attributed         the reason          for  the dif-
ference       in costs        to the time            involved      in processing           mail     of
differing        weights.            He said       that    pieces      of business         reply
mail      weighing       under       1 ounce each generally                  consisted       of cards
or letters          which     could       be counted         very    quickly        and need not
be weighed,          whereas         pieces      of business         reply      mail    weighing
more than         1 ounce each required                   more time        for weighing          and
computing         the postage           due.

        On July       25, 1958,       the Congress           enacted         Public      Law 85-560
 (72 Stat.       420) which       allowed        transmission             of certain         items,
other    than business          reply      cards      and letters,             under     business
reply    labels.         A business        reply      label      is an address             label
bearing     the same indicia             as that        prescribed           for business           reply
cards    or business        reply       envelopes.            (See sample           on p. 4.)
The business          reply   label      is affixed          to the item            being      mailed
as business         reply   mail,       and the addressee                 to whom the mail
is delivered          must pay the appropriate                   first-class           or airmail
postage     for     the item plus          the 2-cent          or 5-cent          fee.

        The intent      of the Congress      in establishing           the fees of
2 cents      and 5 cents      in 1958 was that        the fees would           result    in
recovering       the cost     of processing     business         reply   mail.        In
its   report     dated    February    10, 1958,     on the act of July              25, 1958
 (H. Rept.      1338,   85th Cong.,      2d sess.),      the House Committee
on Post Office         and Civil    Service    stated      that:

                "These     additional        charges       shall      equal,     as
        nearly     as practicable,           the approximate             administra-
        tive    and operating          costs     incurred        by the Post Of-
        fice    Department        in connection          with      the collection
        of postage       and other        lawful      charges        on such matter.
         [Business     reply      mail]"

        From the time            that     the 2-cent       and 5-cent      fees were estab-
lished      in 1958,        the average         annual     salary    of a postal         employee
increased         from    $4,402      in fiscal       year     1957 to $8,224         in fiscal
year    1970,        an increase        of about       87 percent.        The Postal        Ser-
vice,     however,        has not made a study               to determine        the cost       of
providing         this    service       since     the fees were established               in
1958,     nor has it taken              action      to have the fees         increased.          A
postal      official        advised       us that      generally     a study       would    be
made by the Postal               Service       only when needed         to rebut        a chal-
lenge     from business            mailers.
COST OF BUSINESS REPLY MAIL
      During fiscal    year 1970 the Postal        Service   processed
about 733 million    pieces of business       reply mail and collected
fees of about $15.5 million--       an average of about 2.1 cents
a piece.    The Postal    Service   does not maintain      records    of
the costs involved     in processing    business     reply   mail.
      Our review of business   reply   mail at 13 postal  facilities
in seven cities  during   test periods    in fiscal years 1969 and
1970 showed that fees averaged      about 2.1 cents a piece,      or
about 0.9 cent a piece less than our estimate       of the direct
labor cost of about 3 cents a piece to provide       the service,
as shown below.

                                                       GAO estimated       direct                                Excess
                                                            labor    cost                                    cost(-)      or
                                                                             Each           Excess               revenue
                                           Revenue                         piece         cost(-)   or          for each
        Weight              Pieces       collected      Amount            (cents)         revenue          piece      (cent)
2 ounces        or   less   154,282      $3,085.64    $4,518.25             2.9       -$1,432.61                 -0.9
Over    2 ounces               6,201         310.05       252.17            4.1.              57.88                0.9

       Total                -160,483     $3,395.69    $4,770.42             3.0       -$1,374.73                 -0.9


        Our estimate      of the average cost of processing                 each
piece of business         reply mail at the 13 facilities               was com-
puted by applying         the average hourly          productive     pay costs for
postal     clerks     and carriers    to the hours these employees                spent
working      on business     reply mail and dividing             the resulting
cost by the number of pieces of business                   reply mail handled.
Information       was not readily       available      that would permit          us to
reasonably       estimate    the indirect       labor    and overhead       costs
attributable        to business    reply     mail.
       The hours                 postal clerks             and carriers                spent in processing
business   reply                 mail were for             performing               the following   duties.
               --Sorting    business      reply   mail and routing        it through                                      the
                  postage-due     section      of the post office,        the section
                  that establishes        accountability         to ensure collection
                  of amounts due the Postal             Service.
               --Counting    the pieces  of business  reply mail,                                         preparing
                  billing  forms for amounts due, and affixing                                            meter
                  strips  or postage-due   stamps for the amount                                          of postage
                  and fees due.
               --Collecting             postage       and fees         from         addressees.
               --Returning             collections         to the       postage-due                   section.

                                                             7
       --Maintaining     accounting       records  in the postage-due
          section    to account    for    funds received  and business           re-
          ply mail delivered.
       Direct     labor cost of handling         business     reply   mail may
vary I depending       upon the manner in which the mail is delivered
and the postage        and fees are collected.            Business    reply  mail
received      at the postage-due      section     is sorted       by mail ad-
dressed    to business     reply   permit     holders     that maintain     depos-
its with the post office         for payment of postage             and fees due
 (account    mail)    and mail addressed       to patrons       that pay postage
and fees due each time business             reply     mail is received      (non-
account mail).
        Business    reply     mail is delivered         by a carrier      or through
a box delivery        section     of the post office.             For nonaccount
mail    the carrier      or the postal       clerk     servicing     the box section
collects     the amount due before           delivering        the mail.    Permit
holders     have an option        of selecting       the account or nonaccount
manner of paying postage            and fees due.
      At seven facilities       located     in three cities,     we conducted
tests  to determine      the direct     labor costs for handling         account,
box nonaccount,     and carrier     nonaccount     mail.     The results     of
our tests   are shown below.
                                                                      Estimated
                                                                   direct    labor
   Type of business                         Number                'cost for each
       reply mail                          of nieces               piece    Ccents)

Account                                        89,120                   1.8
Box nonaccount                                  2,251                   3.3
Carrier  nonaccount                            11,563                  10.9

     Total                                    102,934                    2.8




                                          8
                                   CHAPTER 3

                               AGENCY COMMENTS
              AND GAO EVALUATION AND RECOMMENDATIONS
        On February    25, 1971, we brought        our findings       to the at-
tention    of the Postmaster      General and suggested           that the
Postal    Service   determine   the amount of unrecovered             costs on
business    reply mail service       and initiate       appropriate      fee
changes so that business        reply   mail fees would recover             the
related    costs incurred     by the Postal       Service.
      The Postmaster        General,     in a letter     to us dated March 29,
1971 (see app. I), stated            that the relationship         between costs
for a postal      service    and rates     for that service        was a matter
for review by the Postal          Rate Commission.           We noted that,    in
accordance     with the provisions         of the Postal       Reorganization
Act, the Postal       Service    made various      proposals     to the Commis-
sion on February        1, 1971, for adjustments           in postal    rates  and
fees.    These proposals,        however,      did not include       any proposal
to adjust    the fees for business           reply   mail service.
        The Postmaster       General stated        that an intervener       (a
third     party who became a party           to a proceeding      to protect   his
interests      therein)    in a proceeding         then before    the Commission
concerning       the Postal    Service's       request   for a recommended de-
cision     on changes in postal         rates     and fees was contending
that the then-current          fees for business         reply  mail were too
high and should be reduced and that therefore                   the issue of
the proper       fee for business       reply mail was involved         in the
proceeding       before  the Commission.
       We reviewed   copies of the statements    filed before  the
Con-mission by the intervener     that used business   reply  mail ex-
tensively    and that was contending    that fees paid for business
reply mail were too high and should be reduced.
       The Postal     Service   has not made any study of the cost of
the business     reply mail service,       and the Commission has not
requested    any cost information.         In the absence of informa-
tion on the nationwide        cost of handling     business  reply  mail,
we believe    that an informed      decision    cannot be made as to the
fees that are required        to recover     the costs of providing   the
service.
RECOMMENDATIONS TO THE POSTMASTER GENERAL

       We recommend that the        Postmaster     General determine        the
nationwide    cost of providing       business     reply mail service         and

                                         9
propose to the Postal  Rate Commission   appropriate       adjustments
to the fees so that the fees will    be adequate     for   recovering
the costs of providing  the service.
                                      CHAPTER 4

                                  SCOPE OF REVIEW
       We reviewed      the procedures    and practices             for handling
business    reply     mail at the following    13 postal              facilities     in
four postal      regions.
     Post office  and
   branch or station                                        Dates    of   test
Hartford,     Connecticut:
      Main office                                    June   10, 11, and 12, 1969
      Wethersfield     branch                        July   1, 2, and 3, 1969
Denver, Colorado:
    Main office                                      October  25 and November 2
                                                       to 8, 1968
     Alcott     station                              December 3 and 6, 1968
     Capitol      Hill  station                      December 3, 4, and 5, 1968
Englewood,    Colorado:
     Main office                                     January     29 and 30,      1969
Golden, Colorado:
     Main office                                     January     6, 7, and 8, 1969
Phoenix,  Arizona:
     Main office                                     January     15 and 16,      1969
Minneapolis,     Minnesota:
     Main office                                     May 13, 14, 20, and 21,
                                                        1969
     Bloomington    branch                           June 10, 11, and 12, 1969
     Minnehaha   station                             June 3, 4, and 5, 1969
Seattle,      Washington:
      Main office                                    July    1, 2, and 3, 1969
      Ballard    station                             June    16, 17, and 18, 1969
         We observed     the processing           of business       reply mail at the
delivery     offices,       determined       the related       costs and revenues,
and interviewed         employees        and supervisors         at these locations.
We also held discussions               with regional       officials      and with
officials      at Postal       Service      headquarters       in Washington,       D-C.
We reviewed       pertinent       legislation;       the legislative        history     of
business     reply     mail;    Postal      Service    regulations;       and other     rec-
ords at the local,           regional,        and national       levels.



                                           11
APPENDIXES




      13
                                                                          APPENDIX   I




                                $Uastfingtan, ?3.K, ‘/DEfill
                                   March 2‘9, 1971




Dear    Mr.      Neuwirth:

Your    letter    of February   25 alleges that we are not recovering
costs    from     users for providing    business reply mail services.

While we appreciate        the opportunity      to review     your studies     of
postal operations,      the relationship      between      costs for a postal
service   and rates for that service         is now a matter        for review
by the Postal Rate Commission             in appropriate       cases.    ln fact,
an intervener     in the proceeding       now pending before the Com-
mission    as the result     of our request      for a recommended
decision   on changes in postal rates and fees is contending                 that
our present     surcharge      for business    reply mail is too high, and
should be reduced.        Thus, the issue of the proper            price for
reply mail is involved        in the present      proceeding     before the
Commission.

We are mindful       of the need, on a continuing     basis,  to establish
and maintain     a proper     relationship between    service   costs and
prices,   consistent     with the criteria  and policy constraints      of
the Postal Reorganization           Act.

                                                    Sincerely,




                                                    Winton       M.   Blount

Mr.   Max A. Neuwirth
Associate   Director,  Civil Division
General   Accounting  Office
Washington,     D. C. 20548




                                         15
 APPENDIX II


                PRINCIPAL    MANAGEMENT OFFICIALS        OF
                         THE POSTAL SERVICE
         RESPONSIBLE FOR ADMINISTRATION       OF ACTIVITIES
                     DISCUSSED IN THIS REPORT

                                                    Tenure     of office
                                                    From                   -To

POSTMASTER GENERAL:
    Winton M. Blount                       Jan.       1969         Present
    W. Marvin Watson                       Apr.       19.6~8       Ja.n.         1969
    Lawrence F. O'Brien                    Nov.       1965         Apr.          1968
    John A. Gronouski                      Sept.      1963         Nov.          1965
    J. Edward Day                          Jan.       1961         Aug.          1963
    Arthur  E. Summerfield                 Jan.       1953         Jan.          1961
DEPUTY POSTMASTER GENERAL:
    Merrill   A. Hayden                    Sept.      1971        Present
    Vacant                                 -Jan,      1971        Sept.          1971
    E. T. Klassen                           Feb.      1969        Jan.           1971
    Frederick   C. Belen                   -Feb..     1964        Jan.           1969
    Sidney W. Bishop       .                July      1963        ,Feb.          1964
    Vacant                                  July      1962        July           1963
    Haran W. Brawley                        Jan.      1961        July           1962
    John M. McKibbin                       Oct.       1959        Jan.           1961
    Edson 0. Sessions                      Sept.      1957        Oct..          1959
ASSISTANT POSTMASTER GENERAL,
  BUREAU OF FINANCE AND
  ADMINISTRATION    (note a):
     James W. Hargrove                     Feb.       1969        Present
     Ralph W. Nicholson                    Mar.       1961        Feb.    1969
     Vacant                                Jan.       1961        Mar.    1961
     Hyde Gillette                         Feb.       1957        Jan.    1961
aBureau of Finance      prior   to April  26, 1964.   Effective
 July 1, 1971, the responsibilities          of the Bureau of Finance
 and Administration      were transferred     to the Senior Assistant
 Postmaster    General,    Support.




                                  16                            U.S. GAO. Vash.. D.C.
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