Y2K threatens Postal Service

The U.S. Postal Service faces a "major challenge" in upgrading its computer systems to avoid the Year 2000 problem, according to a report released last month by the General Accounting Office.

GAO said in its report, which is part of its series on "Major Management Challenges and Program Risks" at federal agencies, that an early assessment by USPS' Office of the Inspector General showed that the agency was slow to recognize the scope of the Year 2000 challenge and take necessary steps to ensure that all its systems were Year 2000-compliant.

USPS is unique in that a number of private-sector and government groups may need to use USPS as a backup delivery system if their computers malfunction because of the Year 2000 bug. "For this reason, the USPS is concerned about the prospect of a mail surge in January 2000," GAO said. USPS estimates it will cost $500 million to $700 million to fix its Year 2000 problem.

Meanwhile, USPS' continued success will depend heavily on its ability to control operating costs, strengthen internal controls and ensure the integrity of its services, GAO said. While USPS has recognized this, "in recent years we have reported on the need to control costs and protect postal revenue in several areas, such as [USPS'] automation program to improve the efficiency of letter carriers," GAO said.

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