USPS OIG: Contract Delivery Service Costs

Background

The U.S. Postal Service uses contracted delivery suppliers to support mail delivery needs and ensure it meets its universal service obligation. CDS is a contractual agreement between the Postal Service and an individual or company for the delivery and collection of mail for customers. CDS is considered one of the Postal Service’s three primary carrier delivery types (city and rural carriers, and contracted delivery suppliers). CDS suppliers1 are not Postal Service employees, but independent contractors who provide delivery service on specific routes not serviced by city or rural carriers.

The objective of our audit was to assess the effectiveness of controls over CDS and its costs.

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So basically contract routes cost more than a rural carrier would make delivering the same route.

For now, but they shouldn’t. The special rate of pay should be lower than the contract rate. However, in my view vehicle size has nothing to do with extra trips. The CDS contracts call for a minimum vehicle size, not maximum. And the contractor OWNS the route. So what if he has the minimum size vehicle? So what if the mail volume has increased? The Contracting Office should be dealing with it, not the Postmaster via extra trips at their contract rate.

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