IG finds more problems with USPS IT management

uspsoigLast month the USPS Inspector General issued a report critical of USPS data backup procedures. The report came in response to an incident earlier this year in which an important security database was lost due to a hardware failure. IT staff had maintained a backup copy of the database, but it was stored on the same hardware as the original- so when the hardware failed, both copies were lost.

Now the OIG reports that the USPS isn’t managing its cloud computing activities properly, and says those failures have cost the USPS over $33 million:

What the OIG Found

The Postal Service’s cloud computing contracts did not comply with all applicable Postal Service’s standards. Specifically, the Postal Service has not defined “cloud computing” and “hosted services,” established an enterprise-wide inventory of cloud computing services, required suppliers and their employees to sign non-disclosure agreements, or included all required information security clauses in its contracts.

In addition, management did not appropriately monitor applications to ensure system availability. Management also did not complete the required security analysis process for three cloud services reviewed and did not follow Postal Service policy requiring cloud service providers to meet federal government guidelines. This occurred because no group is responsible for managing cloud services, and personnel were not aware of all policy and contractual obligations.

Without proper knowledge of and control over applications in the cloud environment, the Postal Service cannot properly secure cloud computing technologies and is at increased risk of unauthorized access and disclosure of sensitive data. We claimed $33,517,151 in contractual costs for the Postal Service not following their policy and contract requirements.

What the OIG Recommended

We recommended management define “cloud computing” and “hosted services,” develop an inventory of cloud services, monitor suppliers and require them to be certified, and revise contracts to include security clauses. We also recommended management evaluate best practices for cloud computing contracts, complete the security analysis process, and ensure compliance with non-disclosure clauses.

USPS OIG reports

If It Prints, It Ships: 3D Printing and the Postal Service

The USPS Inspector General has published a white paper on 3D printing and its possible implications for the US Postal Service:

3D printers build physical objects out of digital designs, usually by assembling powders, metals, plastics, and other materials layer-by-layer with tremendous precision. Because the digital designs can be endlessly tweaked and modified, 3D printing turns customers into creators and taps into the current trend of mass customization. The technology is starting to have a significant impact on the $10.5 trillion global manufacturing sector, and promises to democratize production and fundamentally change the supply chains of today.

A new Postal Service Office of Inspector General white paper explores how the U.S. Postal Service could experience a significant boost in commercial package volume as 3D printing becomes more widespread. Most 3D printed objects are lightweight, which are exactly the type of parcel the Postal Service specializes in handling. As more businesses begin to sell 3D printed goods to consumers, they may need the ubiquitous postal network and the Postal Service’s unmatched last-mile delivery capabilities to better connect with customers. By embracing this groundbreaking technology and potentially partnering with 3D printing businesses to do printing at or near postal facilities, the Postal Service could put a compelling 21st century twist on its historical mission to serve citizens and facilitate commerce.

Read the full report (.pdf): If It Prints, It Ships: 3D Printing and the Postal Service | Office of Inspector General.

OIG: USPS needs to act on replacing its delivery fleet

Screenshot 2014-06-17 at 8.35.44 AM - EditedThe USPS Inspector General says that the USPS needs to get its act together on replacing its aged delivery fleet, which it says will only “sustain delivery operations nationwide until FY 2017”- if it’s lucky:

The Postal Service has an acquisition strategy, but has not fully developed or implemented it. The short-term plan developed in 2011 included acquiring 25,000 vehicles costing about $500 million to meet operational needs and replace some of the aging fleet. The long-term plan included purchasing the next generation of delivery vehicles beginning in fiscal year (FY) 2017. However, this plan lacked details, such as vehicle requirements, specifications, and green technology features. Despite
3 years of effort, neither plan has been approved or fully funded. In January 2014, the Postal Service received approval to purchase 3,509 vehicles to meet a contractual rural carrier vehicle commitment as a stop gap measure.

These conditions occurred due to financial constraints. Our analysis of the delivery vehicle inventory and motorized routes showed the Postal Service could
sustain delivery operations nationwide until FY 2017. On the other hand, it could experience vehicle shortfalls if there are unexpected decreases in vehicle inventory or increases in motorized routes. In addition, aging
vehicles are typically repaired when they break down, even though it would sometimes be more cost effective to
replace them.

In designing new delivery vehicles, management must consider federal fleet regulations, emerging vehicle
technologies, and fleet best practices. For example, growth in the package market could help dictate the design and technologies selected for a new vehicle.
Moreover, replacing vehicles could take more than 10 years. Thus, the Postal Service should act quickly to implement a plan to meet operational needs, achieve sustainability goals, and reduce maintenance costs.

Full report.

OIG: USPS doesn't even know how many historic properties it owns

Screenshot 2014-04-22 at 7.05.53 AMThe US Postal Service’s Inspector General has released a report criticizing the way the USPS cares for the historic buildings and works of art it is responsible for. The OIG report comes on the heels of another critical assessment of USPS practices by the Advisory Council on Historic Preservation last week. Here’s the OIG’s summary of its findings:


The Postal Service did not know how many historic properties it owned or what it cost to preserve them, as required by the National Historic Preservation Act. It did not report the status of historic artwork to the National Museum of American Art, as required by Postal Service Handbook RE-6, Facilities and Environmental Guide, when it sold 10 historic post offices.

The Postal Service did not collaborate with the Advisory Council on Historic Preservation to improve its compliance with the National Historic Preservation Act and did not submit its 2011 status report to the council. The council could help the Postal Service establish covenants to protect historic features and help secure covenant holders to monitor compliance with those covenants. Also, the council could help review public requests to participate in the preservation process. The Postal Service could also use the U.S. General Services Administration — which employs experienced real estate and historical preservation professionals — to assist in the preservation process.

The vice president, Facilities, who approves funding for the relocation of retail services and disposal, also issues the final determination letter after reviewing appeals raised during the process. This gives the appearance of bias. Three of the nine relocations were
appealed and he denied all three appeals.

The Postal Service appropriately applied relocation procedures rather than discontinuance procedures for all
nine properties we reviewed. However, officials did not post the public meeting notification 7 days in advance for one property, as required, and could not show documentation that it met the relocation requirements for two properties.

Read the full report (.pdf file).

The Washington Examiner's phony travel card story

The Washington Examiner, the right wing web site that pretends to be a newspaper, has what it apparently thinks is a big scoop this morning:

Postal employees have spent thousands of taxpayer dollars on gambling, bills and other personal expenses, according to a series of reports by the U.S. Postal Service inspector general.

Shocking, isn’t it? Just one problem- it’s not true. In the first place, of course, most people know by now that the USPS isn’t funded by the taxpayer. But the most important fact that the Examiner chooses to ignore is that government travel cards are credit cards issued to employees who travel on postal business. While the cards are intended to be used solely for official travel expenses, the individual employee is responsible for all charges made on the card.

So if some stupid manager uses his travel card to get a cash advance at a casino so he can gamble, (as has been done), it is accurate to say that

  • he is certifiably stupid
  • he has violated USPS regulations and federal law, and…
  • he should be fired

But it is totally false to say that he has cost the taxpayer, or even the postal ratepayer, any money. That cash advance will appear on his next statement, and Citibank will expect repayment, regardless of whether the advance was made legitimately or not. The USPS isn’t out a single penny.

The Examiner story pretends to be an investigative story, painstakingly crafted from the results of Freedom of Information Act requests, but all of the information it “reveals” is, and always has been, freely available on the OIG website. Had the authors read the reports more carefully, they might have noticed this:

The Postal Service provides individual government travel cards to designated employees for use while on official travel. Employees are responsible for all charges and automated teller machine (ATM) withdrawals.

“Employees”. Not “the taxpayer”, “the ratepayer”, or the USPS. So much for the Examiner’s shocking expose!

If all of this sounds vaguely familiar, it’s because the Washington Post ran a similarly misleading story in 2011. To its credit, the Post corrected most of the errors in that story after we pointed them out. I wouldn’t hold my breath waiting for the Examiner to do the same.

Read more: Postal service employees use travel cards to gamble, pay bills and go bowling | WashingtonExaminer.com.

IG says USPS should consider locality based pay

From a white paper recently published by the USPS Office of Inspector General:

uspsoigThe ongoing debate about the comparability of postal employee wages to their counterparts in the private sector has rarely included discussion of one key element of the U.S. Postal Service’s wage structure. Private sector companies commonly pay employees based on the local cost-of-living and labor market conditions. As a result, it is well understood that someone working in Manhattan, New York will earn more than someone with an identical job in Manhattan, Kansas. The federal government recognizes this notion through well-established locality pay systems for both its white-collar and blue-collar workers. In fact, the federal government was already recognizing the importance and necessity of offering wages based on local conditions at least as early as the Civil War. Continue reading

OIG says USPS failed to recover almost $10 million in Voyager card overpayments

uspsoigThe USPS Office of the Inspector general has issued a Management Alert concerning overpayments to trucking contractors. The USPS issues “Voyager” credit cards to HCR contractors for the purchase of fuel. As part of the reconciliation process, the USPS is supposed to recover any charges above those provided for in the HCR contracts.

The OIG had this to say about the process:

We estimate that the Postal Service did not properly identify and recover about $9.9 million in fuel overpayments to HCR suppliers for fuel year 2009-2010. It failed to collect these overpayments because the HCR Voyager Card Program reconciliation process was not reasonably conducted and documented.

Read the full report: Voyager Card Program for Highway Contract Routes – Unidentified and Unrecovered Fuel Overpayments | Office of Inspector General.

OIG: USPS spent $1.3 billion in non-competitive purchases

A new Inspector General’s audit says the US Postal Service spent $1.3 billion on non-competitive purchases in FY 2011 and 2012- and more than a third of those purchases lacked the required documentation to insure that the purchases were properly made:

uspsoigContracting officials did not provide documentation to support price or cost reasonableness and justifications to award noncompetitive purchases for 21 of 56 purchases (or 38 percent of purchases) valued at $37,064,806. Specifically, they did not conduct price or cost analysis or maintain documentation to support the reasonableness of 13 purchases. In addition, they did not fully complete the noncompetitive justification for awarding 10 purchases, two of which were also missing documentation to support price reasonableness. Further, contracting officials did not always obtain required contract documents from international suppliers due to cultural and language barriers.

Based on our statistical sample, we projected that at least $210 million of the $1.3 billion in purchases made during fiscal years (FY) 2011 and 2012 did not contain documentation to support price or cost reasonableness and justifications to award noncompetitive purchases. This amount was claimed as unsupported questioned costs because of missing or incomplete documentation or failure to follow policy or required procedures but does not necessarily indicate that the Postal Service incurred actual loss.

Noncompetitive Purchasing Practices Audit Report .

Two South Carolina postal workers indicted for delay of mail

uspsoigThe US Attorney’s Office in Columbia South Carolina announced today that two Anderson SC postal workers have been indicted for delay of mail. Linda M. Hughes, age 40, of Liberty, and Kevin William Pearson, age 30, of Anderson, were each charged with a single count. According to the Greenville News, the indictment claims the two “unlawfully destroyed, detained, delayed or opened mail that was intended to be delivered by a Postal Service employee”.

The maximum penalty each could receive is five years imprisonment for violating Title 18, United States Code, Section 1703. The cases were investigated by agents of the United States Postal Service, O.I.G., and were assigned to Assistant United States Attorney David C. Stephens of the Greenville office for prosecution.

OIG ‘Special Agents’ Don’t Have Special Rights

(This article first appeared in the March/April 2013 edition of The American Postal Worker.)

In a recent decision, the Employees Compensation Appeals Board (ECAB) ruled that the Office of Workers’ Compensation Programs (OWCP) acted improperly when it terminated the benefits of an injured worker based on evidence that was impermissibly obtained (F.S., Appellant; Docket 11-863; Issued 9/26/2012).

The ECAB concluded that special agents of the USPS Office of the Inspector General (OIG) violated several federal regulations in a fraud investigation involving the claimant — an all-too-common practice. In its ruling, ECAB admonished OWCP for departing from its obligations, stating vehemently that evidence created outside applicable regulations should be rejected. Continue reading