Initial Findings Document
Mail Processing Facility Review

South Jersey P&DC in Bellmawr, NJ

2/28/24

As part of a $40 billion investment strategy to upgrade and improve the Postal processing, transportation, and delivery networks, the U.S. Postal Service announced that it is conducting an evaluation of current operations and potential future uses of its South Jersey Processing and Distribution Center (P&DC) facility in Bellmawr, NJ.

The USPS ten-year Delivering for America (DFA) plan includes initiatives to improve organizational and operational processes and actively make the Postal Service an efficient, high-performing, world class logistics and delivery provider. Improvements to Postal operations will enhance the level of service provided to the public; drive innovation and enable a broader array of postal products and services; enhance organizational competitiveness; improve efficiency and lower the cost to operate; and provide better workplaces and careers for Postal Service employees.

This specific facility review will inform the best allocation of resources and strategies to improve customer service and to achieve significant cost savings through operational precision and efficiency. Business mail entry, Post Office, station, and branch retail services are not expected to change, and delivery services will be unaffected throughout this review. The evaluation is a first step in the Postal Service review and investment process in this facility and will not result in this facility’s closure or career employee layoffs.

This ongoing review was initiated to evaluate what role the facility will take in the redesigned postal network and to assess potentially moving some of the mail processing operations from the South Jersey P&DC to the Philadelphia P&DC in Philadelphia, PA.

Below are initial findings from the study:

Facility Future
The initial results of the facility review support the business case for keeping the South Jersey P&DC open and modernizing the facility as a Local Processing Center (LPC) with simplified processes and standardized layouts. The South Jersey LPC will be a critical node to the unified movement of mail and packages across the regional processing and transportation ecosystem in a logically sequenced manner and will benefit from the expanding services the Postal Service plans to deploy to increase its revenue and enhance its role in this community. The facility will offer expanded and streamlined package processing and distribution capabilities in the local market and new workplace amenities for USPS employees. 

It is anticipated that the facility will maintain the following destination operations once converted to the LPC:

•	Destinating Letters and Flats
•	Destinating Packages
•	Destinating Bundles
•	Manual Letters and Flats
•	Express
•	Business Mail Entry Unit (BMEU)

The LPC will also be fitted with state-of-the-art sorting equipment that will improve delivery services. New mail and processing equipment investments totaling ~$2.5M will be made to locate 1 Single Induction Package Sorter (SIPS-Gen 3). The investment cost and new processing equipment may be subject to change as we are still in the SIPS-Gen 3 design phase. Overall, we plan to operate the following sorting equipment in this facility:

•	18 Delivery Barcode Sorter (DBCS)
•	2 DBCS Input Output Subsystem (DIOSS)
•	2 Automated Flat Sorting Machine 100 (ASFM 100)
•	1 High Speed Tray Sorter (HSTS)
•	1 Low-Cost Reject Encoding Machine (LCREM)
•	1 Automated Package Processing System (APPS) 
•	1 Single Induction Package Sorter (SIPS-Gen 3) [New] 

The improvements for this facility will result in up to $14.5 million in investments for modernization efforts and deferred maintenance investments.

On the workroom floor, lighting will be upgraded with LEDs, flooring will be repaired and refinished, impediments to open process flow will be removed, and dock areas will be generally rehabilitated. Employee amenities will be refreshed with renovation to restrooms, lockers, and break areas. Parking lots will be repaired and renovated in preparation of both Next Generation Delivery Vehicles (NGDVs), as well as Battery Electric Vehicles (BEVs). Where BEVs will be deployed, we will be upgrading and developing the electrical infrastructure necessary to power the rollout of BEVs into our delivery fleet.

Additionally, the business case supports transferring mail processing outgoing operations to the Philadelphia P&DC. Currently, a majority of mail and packages are destined outside of the South Jersey area to the rest of the world.

Finally, the consolidation of plant operations will allow the South Jersey LPC to be co-located with a Sorting and Delivery Center (S&DC). These new facilities are comprised of repurposed facilities and will provide faster and more reliable mail and package delivery over a greater geographic area.

S&DCs will be fitted with new package sorting equipment and enable customer service and local commerce opportunities for Same Day or Next Day delivery. They will also have renovated bathrooms and breakrooms for Postal Service employees. 

In addition, S&DCs will have the infrastructure needed to support the deployment of the Postal Service’s new electric delivery trucks and the charging stations needed to power them. Replacing the Postal Service’s more than thirty-year-old vehicles will allow the organization to significantly reduce carbon emissions, increase safety and reliability, and provide more comfortable delivery vehicles to letter carriers. The S&DC that will be collocated with the South Jersey LPC will have 295 delivery routes that are eligible to be serviced by BEVs. Based on the average deployment numbers at S&DCs, new vehicle investment in BEVs is around $5M per site.

The facility will feature evolving USPS’s self-service tools and technology to give customers added services and new choices in how they ship and receive packages:

•	Secure Lobby Access
•	Biometric (Fingerprinting Services)
•	Smart Lockers
•	Mobile App w/ Self Service Station
•	Rapid Dropoff Station (RDS)
•	Large Parcel Drum

The Postal Service plans to invest between $20M to $25M into the South Jersey LPC for modernization, deferred maintenance, new vehicle infrastructure, and new processing automation equipment, as we prepare the facility to serve as an important contributor to operations in today’s economy and far into the future.

Postal Employees
NOTE: There will be no career employee layoffs as part of this initiative. The numbers presented here reflect data available as of October 6, 2023, and are subject to change until the completion of the facility review. Our ongoing analysis will include quantifying the time it will take to refurbish the facility and prepare it for the services and functions as an LPC and quantifying the appropriate workforce necessary to efficiently staff the LPC. We expect that the increase in these services and functions may require additional employment positions, which could mitigate some of the reductions identified below.

Due to the transfer of outgoing operations, an estimated net decrease of 27 craft and 3 management positions are projected once the initiative is completed. All bargaining employee reassignments will be made in accordance with the respective collective bargaining agreements.

The Postal Service has made a commitment to ensuring there is a clear path for our pre career employees to obtain fulltime positions, as evidenced by our newly negotiated contract provisions and making automatic conversions to stabilize our workforce. This has culminated in 165,798 pre career employees being converted to career over the past three years. Our pre career workforce is a valuable employee category that provides us necessary operational flexibility leading to efficiencies. Like all employers who have a flexible employee category, there is a higher turnover rate with these employees, providing us the opportunity to both capture savings by rightsizing our workforce when making long overdue operational changes and avoiding any career layoffs.

Estimated Cost Savings 
Proposed savings in the draft MPFR analysis are ultimately projected to be $4.0M to $5.4M annually once the initiative is completed. Below is a breakdown of this savings estimate:

•	Annual Transportation Savings	$2.0M - $2.7M
•	Annual Maintenance Savings	$1.1M - $1.5M
•	Annual Mail Processing Savings	$710K - $950K
•	Annual Management Savings	$260K - $345K

Local Customer Considerations
•	Retail and other services currently available will not change
•	Business mail acceptance will remain the same
•	A local postmark will continue to be available at retail post offices
•	Delivery times of mail to residences and businesses should not change because of the review

Commercial Mailers
•	Mailers who presort mail will continue to receive appropriate postage discounts
•	Mailers who drop ship to a Destination Sectional Center Facility (DSCF) can expect no changes, if the MPFR is approved

Please go to https://www.surveymonkey.com/r/mpfr-south-jersey-nj to submit written comments. All written comments must be received by March 21, 2024.