Postal Service reports $1.3 billion loss in first quarter
The U.S. Postal Service reported a net loss of $1.3 billion for the first three months of fiscal 2013, despite successes in maintaining revenue and cutting expenses.
The $17.7 billion in revenue from October through December was virtually unchanged from the same period a year ago and expenses were down almost 10 percent, according to financial results released at a meeting of the Postal Service’s Board of Governors.
Total mail volume was 43.5 billion pieces, down slightly from 43.6 billion pieces last year. While revenue from first-class mail — the Postal Service’s most profitable line — dropped 3.1 percent, that dip was offset by 4.7 percent growth in shipping and package revenue and a 3.1 percent increase in standard, or advertising, mail income.
On an operating basis, the mail carrier showed a profit of about $100 million.
But the red ink resulted from $1.3 billion in paper expenses for workers’ comp adjustments and the quarterly installment of a retiree health care prepayment obligation. On an annual basis, the Postal Service is legally supposed to pay about $5.6 billion into a fund for future retiree health care. But the cash-strapped agency defaulted on the payments due in 2011 and 2012 and says it will be unable to make this year’s as well. It must nonetheless book the cost as an expense.
Because of the holiday shipping season, the first quarter is typically the Postal Service’s most profitable quarter. Further bolstering results this year was a flood of election-year political mail.
Friday’s board meeting came two days after Postmaster General Pat Donahoe announced that the Postal Service will end Saturday mail delivery starting in August, although package delivery will continue. That measure, which the Postal Service says will save $2 billion a year, followed a board directive to accelerate cost-cutting efforts, but has drawn fierce criticism from some members of Congress.
The board strongly supports the move, Chairman Mickey Barnett said Friday. He added, however, that the Postal Service still needs comprehensive legislation to return to long-term financial stability.
New head of National Weather Service named
Louis Uccellini will be the new director of the National Weather Service, effective Sunday.
Uccellini, 63, has been with the weather service since 1989, most recently as the director of the National Centers for Environmental Prediction in College Park, Md. He will be the 16th director of the weather service, which is part of the National Oceanic and Atmospheric Administration (NOAA).
He was the president of the American Meteorological Society and the author of more than 60 journal articles and chapters in books. He literally wrote the book about blizzards as the co-author of the two-volume book Northeast Snowstorms.
Uccellini replaces acting director Laura Furgione, who served since May. She replaced Jack Hayes, who was director from 2007 until last May. Hayes retired after an internal investigation found that agency staff improperly moved money among different accounts without congressional authorization.
Furgione will return to her position as weather service deputy director.
Uccellini becomes director at a challenging time for the agency, dealing with budget issues that could hamper efforts to improve such critical needs as weather satellites and weather prediction models.
In a telephone interview Wednesday, Uccellini stressed the importance of maintaining transparency in budget issues.
He agreed with concerns within the meteorological community about the state of the top U.S. weather prediction model (the GFS), saying he will be “moving aggressively” toward its improvement.
“It’s an honor to lead such a prestigious agency with the unbeatable mission of protecting lives and livelihoods,” Uccellini said. “The past year had its success stories with superior outlooks, forecasts and warnings, including those for Sandy, but difficulties remain.
“Our eyes remain locked on the future to ensure a National Weather Service that is second to none and supports a weather-ready nation.”
Agencies coming up short on green gov goals
Many agencies are missing targets for meeting energy efficiency and sustainability mandates, citing tighter budgets.
The Defense Department said in a new report that it will not likely reduce energy use at its facilities by 30 percent from a 2003 baseline by 2015. It said it achieved only a 13 percent reduction in 2011. DoD was one of many agencies that filed updates on their sustainability efforts with the Office of Management and Budget. OMB released those reports Thursday.
DoD said it also will fail to meet a goal to have 15 percent of its buildings meet federal green guidelines. Newly constructed buildings must use 30 percent less energy than a typical building of the same size. Renovated buildings must use 20 percent less energy.
Only about one-tenth of 1 percent of the department’s buildings meet green guidelines.
The report said that the Defense Department renovates and maintains facilities in a “budget-constrained” environment by fixing buildings with the greatest needs — not in making buildings more environmentally sustainable.
The Department of Homeland Security reduced facility energy use by 14 percent in 2011 — but that is less than halfway to the 30 percent goal. Only 2 percent of DHS’ buildings meet green guidelines.
The Health and Human Services Department is seeing mixed results, with only 4 percent of its buildings meeting green guidelines but achieving a 19 percent reduction in facility energy use in 2011.
But the General Services Administration is on track or exceeding all of its goals, according to the agency’s report. More than 8 percent of its buildings meet green guidelines and it has reduced energy use at its facilities by 19 percent as of 2011.
Nancy Sutley, chair of the White House Council on Environmental Quality, said in a news release that agencies are seeing positive results after three years of effort.
“Agencies are demonstrating significant progress on sustainability initiatives that are good for American taxpayers and good for American communities,” Sutley said.
Interior nominee Sally Jewell is environmentalist, business exec
President Obama’s nomination of Sally Jewell for Interior secretary Wednesday was lauded by several retail and environmental groups and is expected to pass the Senate without much objection.
Jewell is president and CEO of outdoor apparel and equipment company Recreational Equipment Inc. (REI), based in Kent, Wash. But she is perhaps even more well-known for her work with environmental nonprofits and conservation groups.
And as Interior secretary, Jewell would oversee the health and conservation of the nation’s public lands. If confirmed by the Senate, she will succeed Ken Salazar and will be one of the few female members of Obama’s Cabinet.
Obama praised Jewell’s “broad expertise” during the nomination Wednesday and her love of the outdoors.
The 56-year-old Great Britain native has served as CEO of REI since 2005, but she also sits on several boards, including for the National Parks Conservation Association and Initiative for Global Development.
NPCA President Thomas Kiernan says Jewell “knows how to work across the aisle.”
“When Sally speaks, people listen,” he says.
REI declined to release Jewell’s political affiliation but according to the nonpartisan Center for Responsive Politics, she has made campaign contributions almost solely to Democratic candidates going back to 2008.
Jewell has won numerous environmental awards, such as the 2009 Rachel Carson Award for Environmental Conservation from the Audubon Society. Last year, she received the Award for Public Service from the Woodrow Wilson Center and was a named a 2012 Woman of Distinction by the Girl Scouts of Western Washington.
Jewell also worked with Obama’s America’s Great Outdoors Initiative, launched in 2011, according to her biography provided by REI. And in 2009, she participated in a White House meeting on health care reform, discussing REI’s health benefits program.
Sen. Ron Wyden, D-Ore., who also chairs the Energy and Natural Resources Committee that will hold Jewell’s hearings, called the nomination “an inspired choice” in a release the committee put out.
“Her record shows that she understands the importance of preserving our public lands for future generations, as well as the critical links between public lands, natural resources and economic growth,” he said.
More employees contest negative performance appraisals, raise denials
More employees are contesting negative performance appraisals, denials of step increases that would raise their pay, and other personnel actions that negatively affect them, Merit Systems Protection Board records show.
The board last year decided more appeals of performance actions and step-increase denials in at least eight years.
In its annual report, released Jan. 31, MSPB said the federal budget crunch — which has already meant pay scale freezes and restrictions on performance awards — may be driving the increase in such appeals.
“Constraints on pay and awards may also shift employees’ attention to the application of performance appraisal systems and ratings, which could in turn increase performance-based appeals to MSPB,” the report said.
And the threat of furloughs or layoffs could prompt disgruntled federal employees to file many more appeals, MSPB said.
“Historical trends indicate that increasing [reductions in force, or layoffs] would lead to potentially large increases in the number of appeals filed with MSPB,” the report said.
MSPB decided 155 performance action appeals in fiscal 2012, a 41 percent increase over fiscal 2011, and the highest since 2004, when MSPB decided 158 appeals.
The board decided 42 appeals of denials of within-grade step increases in 2012, a 27 percent increase over the previous year, and the highest since 1999, when MSPB decided 45 such appeals.
Adverse action appeals, which are by far the most common, increased 2 percent in 2012 to 2,798.
The report does not indicate how many of the various appeals were decided in employees’ favor.
MSPB said that continuing to freeze employee pay and reducing hiring and training also could do long-term harm on the federal workforce’s efficiency and effectiveness, and hurt the government’s ability to follow merit systems protections and avoid prohibited personnel practices.
“It could take years for federal agencies to recover from these issues,” MSPB said.
The law firm Tully Rinckey, which handles federal employment and discrimination issues, said that federal employees should remember their options for appealing or grieving a negative performance appraisal.
“Although the federal government strives to keep performance appraisals as objective as possible, some subjectivity seeps into the system and may influence it,” said John Mahoney, chairman of Tully Rinckey’s labor and employment law practice group. “Federal employees deserve to be recognized for the hard work they do, and unacceptable performers need to be properly rehabilitated or disciplined if bad performance does not improve.”
180,000 Air Force civilians face furlough under sequestration
The Air Force is preparing to furlough about 180,000 civilian employees — essentially its entire civilian work force — for 22 days if sequestration goes into effect.
According to a recent presentation the Air Force made to Congress, this would dock their pay about 20 percent for the rest of fiscal 2013. The Air Force called the massive furloughs an “unprecedented action” that “breaks faith [with] civilian airmen critical to [the] total force.” The Air Force said those furloughs would endanger its mission and restrict access to institutional knowledge.
Federal Times’ sister paper, Air Force Times, obtained the presentation.
The Air Force has already frozen hiring, and is laying off up to 3,200 non-mission-critical temporary and term employees. The hiring freeze will slow the Air Force’s ability to field employees trained to manage nuclear weapons, and will hurt its intelligence collection and analysis programs, the presentation said. The Air Force also expects to replace civilian gate guards with military service members. And the Air Force is canceling non-mission-critical travel such as inspections, conferences and training seminars.
Postal Service to end Saturday mail delivery
The U.S. Postal Service plans to end Saturday mail delivery starting Aug. 1 as part of its effort to stem huge losses, Postmaster General Pat Donahoe said Wednesday. Package delivery would continue and post offices would remain open Saturdays.
As mail volume continues to plunge, “it’s the right thing to do,” Donahoe said at a news conference at USPS headquarters. The move, which carries an estimated $2 billion in annual savings, would cut work hours by the equivalent of some 22,500 full-time employees, Donahoe said. With unionized career workers generally protected from layoffs, the Postal Service plans to handle the reduced workload through attrition, overtime cuts and paring the hours of non-career employees.
Donahoe said it is possible the Postal Service will offer additional early retirement or buyout packages to encourage employees to leave. “We’ll see, it’s a negotiation issue,” he said.
Ending most Saturday delivery has long been a top cost-cutting priority for the Postal Service, which lost almost $16 billion in fiscal 2012. The Obama administration last year endorsed the move. But Congress has consistently prohibited changes in the frequency of daily mail delivery. That ban has been in annual spending bills for years and remains in effect under the continuing resolution that expires March 27. Donahoe acknowledged that a legal challenge could lie ahead.
In a news release, the National Association of Letter Carriers, the union that represent mail carriers in urban areas, accused Donahoe of flouting the will of Congress and called for his removal. The end to most Saturday delivery “would have a profoundly negative effect” on the Postal Service and harm small businesses, the elderly and others “who depend on Saturday delivery for commerce and communication,” NALC President Fredric Rolando said in the release.
The step would be “another death knell for quality service,” Jeanette Dwyer, president of the National Rural Letter Carriers’ Association, said in a separate release. “To erode this service will undermine the Postal Service’s core mission and is completely unacceptable.”
The plan to end Saturday mail delivery is certain to dominate a previously scheduled Feb. 13 hearing on the Postal Service by the Senate Homeland Security and Governmental Affairs committee. Donahoe and Dwyer are among those scheduled to testify.
January sees large spike in federal retirements
January saw the biggest one-month exodus of new federal retirees in at least three years.
The 22,187 federal employees who retired last month represented a 3 percent increase over January 2012, according to new data by the Office of Personnel Management. Last month’s retirement total was 13 percent higher than the 19,672 retirements in January 2011, and 38 percent higher than the 16,043 in January 2010.
January is almost always the month that sees the largest number of federal retirements.
OPM also said it processed 12,527 pension claims last month, which very nearly matched the record 12,563 claims processed last September. The sharp increase in retirements increased the backlog of unprocessed claims from 26,402 in December to 36,062 in January.
However, the backlog currently has about 2,000 fewer cases than OPM expected at this point. Since July — when OPM’s newly hired pension processors finished their training — OPM has beaten its monthly goal of processing 11,500 cases six out of the last seven months.
Lockheed offers buyouts to employees; layoffs possible
Lockheed Martin is offering buyouts to midlevel managers in its information systems and global solutions unit, a company spokesman confirmed Tuesday.
An unspecified number of eligible employees have until the end of the month to volunteer for layoffs. If approved by the company, those employees must leave Lockheed by March 22, said spokesman Keith Mordoff.
Mordoff said the voluntary layoffs were not prompted by looming sequestration budget cuts, but Lockheed’s information systems and global solutions unit is assessing the potential impacts of sequestration to its business, programs and customers.
“The reduction in force is designed to best position the business to remain competitive and operationally efficient, providing the most affordable solutions to our customers,” Mordoff said.
Lockheed is looking to reduce its workforce by 300 to 350 employees, he said. It isn’t clear over what time period.
Mordoff would not say how many of the select group of midlevel managers are eligible for buyouts or how many will be selected to receive them. Those selected will receive severance benefits, he said.
Technology career site Dice News first reported the buyouts Monday. Citing an unnamed source, Dice reported that there may be layoffs if enough managers do not leave voluntarily.
In an internal company memo obtained by Dice, unit leaders were told that certain employees working in the areas of defense and national operations are eligible to participate.