Author: Venable, Cindy C - Washington, DC

Mail Processing Facility Review
Notice to Make Significant Upgrades

Sioux Falls Processing & Distribution Center

September 22, 2026

On January 10, 2024, it was announced that we were beginning a Mail Processing Facility Review (MPFR) at the Sioux Falls Processing and Distribution Center (P&DC) in Sioux Falls, SD, to see if it made sense to transfer some mail operations into the Omaha P&DC in Omaha, NE.  The results of the facility review supported keeping the Sioux Falls facility open and modernized as a Local Processing Center (LPC).  Additionally, the business case supported transferring mail processing outgoing operations to the Omaha P&DC.  Currently, a majority of mail and packages are destined outside the Sioux Falls area to the rest of the world.

Then on November 19, 2024, it was announced that certain local originating processing operations would remain at the Sioux Falls P&DC.  This decision to leave those operations in Sioux Falls was made possible due to a proposed operational strategy aimed at increasing efficiency, improving service quality, and saving USPS an additional $3 billion per-year nationwide.  This proposed strategy was outlined in its request for an advisory opinion filed with the Postal Regulatory Commission.  The significant savings generated by this proposed operational strategy would enable the Postal Service to absorb the cost of continuing to provide local cancellation service in Sioux Falls.  The Postal Service made these determinations based on efficiencies gained by operational improvements and service standard refinements separate from the MPFR process.

Over the last year, the Postal Service has been reviewing its processing and logistics operations at the three South Dakota processing plants in Sioux Falls, Huron (Dakota Central), and Rapid City  The assessment resulted in a planned change to resolve unintended service issues resulting from the three plants flowing into three different out-of-state processing hubs.  Therefore, the approved MPFR dated April 30, 2024, will not be implemented. 

On September 22, 2026, it was announced that significant upgrades will occur at the Sioux Falls P&DC which will result in quicker intrastate mail and package service for many South Dakota customers.  The Postal Service plans to upgrade the Sioux Falls plant from a P&DC to a Regional Processing and Distribution Center (RPDC) beginning January 1, 2027.  

As part of this upgrade, the Sioux Falls plant will become a major node in its newly modernized network handling most originating and destinating mail and packages for South Dakota and allowing faster inter-plant connections to other major hubs nationwide.  The change will also allow for quicker service standards within the state, potentially reducing travel time for a letter by one to two days.  Travel time may vary depending on the drop-off location, time and method of entry, and other factors.

This change was partially enabled by the installation of the new Parallel Induction Linear Sorter (PILS) package machine in Sioux Falls in late June, 2026.  This machine significantly enhances operational performance because it is 40 percent faster than previous machines.  New and upgraded equipment throughout South Dakota will increase package sorting throughputs, improve automation capabilities for larger packages, increase sortation accuracy, and improve machine reliability.  Improvements to bundle sortation and letter processing are also in progress.

We are pleased that we can make these modernization improvements for our South Dakota customers, and we believe they will see noticeable changes.