U.S. Postal Service

The Postal Service has proposed relocating postal operations for the Antelope Valley from the Main Post Office in Mojave, California, to a new facility in Lancaster, California. A Member of Congress has raised concerns about whether the Service appropriately acquired land in Lancaster and properly considered project costs. This report evaluates whether the Postal Service followed its capital project approval process for the purchase of land in Lancaster. GAO also identifies the reasons for delays in the project and the effects of those delays on postal operations, project costs, and affected communities.

GAO noted that: (1) the Service followed most of its key requirements for acquiring a site in Lancaster in 1991 prior to obtaining approval for the proposed Antelope Valley project, although some requirements were vague; (2) one major exception was that review and approval of the proposed project justification and alternatives by the Headquarters Capital Investment Committee did not take place prior to the advance site acquisition in Lancaster, as required by Service policies; (3) Service guidance was unclear because it required that alternatives be identified and analyzed before a project could qualify for advance site acquisition, but it did not clearly state the type or depth of analysis required; (4) at the time of the Lancaster site acquisition, the analysis to support the decision was incomplete; (5) more detailed analyses were still under development; (6) GAO could not determine from available documentation why the alternative to construct a new facility in Lancaster was preferred over other alternatives that had been proposed or why various alternatives were not considered viable; (7) the Lancaster site purchased for $6.5 million in 1991 has remained unused since that time due to the Service's failure to decide how and when it will resolve the long-standing problems that the proposed Antelope Valley project was to address; (8) continuing negative effects have resulted from the incomplete status of the project for almost 10 years; (9) project approval and funding of the project remain uncertain due to delays resulting from two suspensions, limits on capital spending, and changes in project classification; (10) it is unclear how the Service intends to address the space deficiencies that have contributed to operational processing and delivery deficiencies in the Antelope Valley area; (11) because of continued space deficiencies, automated equipment was sitting unused in warehouses, some mail delivery was being delayed, and the projected operating efficiencies and savings have not been realized; (12) the Service has invested $6.5 million in land that has been unused for nearly 8 years; such an investment has a substantial annual interest cost estimated at over $300,000; (13) it has also incurred additional costs to update documents required for project approval and may incur more costs if some of these documents again have to be updated when the project is reviewed for approval; and (14) the Lancaster and Mojave communities have faced uncertainty over business development opportunities as a result of the project delays.

Recommendations

Our recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.

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