(The Center Square) – A follow-up audit of the Atlanta Regional Processing and Distribution Center shows $16.1 million in questioned costs, including $8 million in unauthorized overtime, a report said.
The audit released this week from the Office of Inspector General of the United States Postal Service follows a previous report that showed the center had challenges that were adding to labor and transportation costs. This week’s audit looked at operations in December and March 2025 in a new Atlanta processing center that first opened last year.
The audit shows the expected savings anticipated by the move to the new center will not be realized.
“The Postal Service was forced to expand operations into a nearby annex to help receive mail and trailers for the RPDC (regional processing and distribution center), and as a result, it is unlikely it will achieve expected savings in fiscal years 2026 and 2027,” the audit said. “Additionally, the facility continues to experience challenges related to the layout and space needs, management oversight and workplace culture, and transportation. These issues contributed to over $16.1 million in questioned costs.”
Auditors found deficiencies in management oversight and workplace culture at the regional processing center.
“We also found that nearly 80 percent of all overtime hours at the facility from July 1, 2024, through March 28, 2025, were not authorized,” auditors said. “However, management at the Atlanta RPDC did not approve approximately 178,000 hours of overtime and 4,000 penalty overtime hours, totaling over $8 million in questioned costs.”
Management disputed the finding.
“Management stated the use of overtime was needed and justified based on the workload but not approved by a supervisor in the timekeeping system,” auditors said in the report.
About 20% of employees on average are not showing up to work every day, auditors said.
The Postal Service anticipated the new Atlanta facility would save $22 million in labor costs in fiscal year 2026 and $66 million in fiscal year 2027. That is unlikely to happen, the audit said.
“Atlanta RPDC mail processing is 10 percent understaffed, while other facilities in the region are overstaffed by as much as 28 percent. For example, the Atlanta and Duluth LPCs (local processing centers) collectively have more than 200 personnel over current staffing needs due to the inability to quickly reduce and transfer personnel in accordance with union contracts. Because the Postal Service has not balanced staffing, there is an overreliance on overtime to process the mail at the Atlanta RPDC,” auditors said.
The audit included pictures of disarray. One container dated Dec. 17, 2024, said, “Mail from the week of 11-12-2024.”
During a March visit, inspectors found a problem with a sorting system that left old mail “lingering” at the facility for 30 days.
Inspectors recommended an evaluation of how the center could better use space, optimize costs and improve processing efficiency.
Officials at the center disagreed with the assessment.
“Management disagreed that the facility cannot handle the volume of mail and trailers it receives and remains one adverse event away from gridlock. However, it stated that winter storms drastically impacted operations in the Atlanta area causing unavoidable service impacts,” the audit said.
Transportation issues added millions in questionable costs, auditors said. They include slower unloading times of trailers and the charging of transportation costs to other facilities.
Management at the Atlanta processing center said it plans to address the issues with deadlines of July 31 and Aug. 31 to implement the changes.
Problems have plagued the postal service nationwide. The agency expects a net loss of $6.9 billion in fiscal year 2025, according to previous reports.
Former Postmaster General Louis DeJoy stepped down in February. David Steiner was appointed as the new postmaster general in May.
