Audit Report – DR-AR-15-006 – 04/28/2015
Background
The vehicles owned by the U.S. Postal Service represent a capital investment of nearly $3.6 billion. The fleet is maintained using 316 Postal Service vehicle maintenance facilities that service 211,264 vehicles. The Postal Service also contracts with commercial garages throughout the country for maintenance and repair. The vehicle maintenance program mission is to ensure safe, dependable, and economical performance of Postal Service vehicles. In fiscal year (FY) 2014, the Postal Service vehicle maintenance expenses totaled $1.1 billion.
The Postal Service established performance indicators to gauge the effectiveness and efficiency of the vehicle maintenance program. These indicators include overhead and workload management at the maintenance facilities. During FY 2013, we audited facilities in the Capital Metro and Pacific areas and found inefficiencies, mismanaged resources, and inadequate controls.
Our objective was to assess the overall efficiency of vehicle maintenance facility operations in the Eastern, Great Lakes, Northeast, Southern, and Western areas.
What The OIG Found
Vehicle maintenance facilities were not operating at peak efficiency and were not efficient when compared to the established targets. Specifically, undistributed labor, work order hours that were more than the timecard hours, was 11 percent of total maintenance labor costs and exceeded the established target of 3 percent. Also, overhead (supervisory and support) labor costs were 24 percent, of total maintenance labor costs, which were lower than the established overhead target of 30 percent. The VMFs had 109 vacant administrative and supervisory positions.
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These conditions occurred because of management’s lack of oversight in monitoring mechanic workhours, as well as not reaching the workhour targets due to administrative and supervisory vacancies. Improving oversight and right sizing staff at vehicle maintenance facilities would increase overall efficiency, saving the Postal Service 431,129 workhours at a cost of over $21.8 million annually.
What The OIG Recommended
We recommended management reduce 431,129 undistributed workhours for maintenance and repairs. We also recommended management right size staffing at vehicle maintenance facilities to improve operations.