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093053 1 (1970-10-21)

handle is hein.gao/gaobacwyh0001 and id is 1 raw text is: 003053 UNITED STATES GENERAL ACCOUNTING OFFICE WASHINGTON, D.C. 20543 OCr 21 1970 CIVIL D.V;SION BEST DOCUMET AVAILABLE iII l 11 ll1jiII 1 LM093053 The General Accounting Office made a survey of fourth-class mail operaticns at the Chicago Post Office and obtained information to serve :s a easis to: determining the feasibility of making in-depth :eviews any operation considered by us to need management attention. The folitwing items were identified during the survey as warranting attention. However, because of actions taken or to be taken by the Department to improve fourth-class mail operations, we do not, at this time, intend to do any further work in those areas. Postal rates Postal rates did not recover costs of processing catalogs, out- side parcels, and other fourth-class mail. Each year the Post Office Department handles over one billion pieces of fourth-class mail con- sisting primarily of parcels and catalogs, the average weight of which is 5 pounds. Although fourth-class mail represents only 1.3 percent of the total pieces of mail, it accounts for 38 percent of the total weight and 13 percent of the total revenue of all classes of mail, During fiscal %ear 1969, zone-rate fourth-class mail revenues totaled $830 million and related costs totaled $953 million, resulting in an operating oeficit of $123 million. Accorcing to the law, fourth- class mail revenues should recover, within 4 percent, the cost of handling fourth-class mail. However, for fiscal year 1969, zone-rate revenue only recovered about 87 percent of such cost. On July 16, 1970, the Interstate Commerce Commission approved the Department's request to increase postal rates for zone-rated parcels by 15.4 percent and for catalogs by 6 percent. In addition, the Com- mission has instituted an investigation of the Department's request for approval of a 35-cent surcharge for parcels whose dimensions make them hard to handle within the post office. The Department estimated that the $123 million revenue deficiency would be almost eliminated by implementing all the requested increases in postal rates. Transportation costs Legislative restrictions seemed to prevent the Department from purchasing economical transpr tation for parcel post and other mail from motor common carriers. Ihe Department was prevented by law from qv[d3s3

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