USPS losing millions to fuel-guzzling contractors

The Postal Service incurred millions in unnecessary fuel costs from its contractors because it isn't using industry averages for fuel consumption and has no procedures in place to ensure contractors are using fuel efficient vehicles, a May 27 USPS inspector general report says.

USPS contracts for transportation on over 15,000 highway contract routes by identifying miles to be driven and negotiating a base operating rate per mile, the report (pdf) says.

Fuel is a major component of HCR total costs. The Postal Service negotiates annual fuel allotments based on miles per gallon, considering past suppliers' MPG contracts and general vehicle and route type, the report says.

In fiscal 2012, HCRs used over 242 million gallons of fuel, costing USPS almost a billion dollars.

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