Background
Contract Delivery Service (CDS) is a contractual agreement between the U.S. Postal Service and an individual or company for the delivery and collection of mail to and from homes and businesses. CDS routes, operated by suppliers or their employees, were established to provide a cost-effective and efficient solution for the Postal Service, especially in rural areas. In fiscal year (FY) 2025, the Postal Service had more than 8,273 active CDS contracts, which cost approximately $593 million. Poor management of CDS suppliers can lead to inefficiencies, higher costs, and greater risks of mail loss, damage, or theft, and accidents and injuries due to inadequate enforcement of safety and security measures.
What We Did
Our objective was to evaluate the management, efficiency, and safety of CDS. For this audit, we reviewed CDS operations at ten delivery units nationwide. Additionally, we conducted a random confidential survey of 213 administrative officials (AO) responsible for managing CDS operations.
What We Found
We identified challenges with the management and execution of CDS impacting mail security, carrier safety, and operational efficiency. Specifically, some CDS mail carriers lacked security clearances, while others engaged in unsafe driving practices and there were no requirements for accident reporting. Further, certain carriers did not possess required English language skills to effectively communicate with Postal Service staff and customers. We also found that local management of CDS operations could be improved and identified $1.9 million in incorrect extra trip payments made annually to suppliers in FYs 2024 and 2025, which resulted from using incorrect rates. Finally, headquarters management’s limited oversight and dependence on manual processes restricted visibility into local operations and minimized performance accountability.
Recommendations and Management’s Comments
We made four recommendations to address issues regarding safety and security deficiencies. Additionally, we made six recommendations to streamline and improve oversight of CDS operations. Postal Service management agreed with all 10 recommendations. Management’s comments and our evaluation are at the end of each finding and recommendation. The U.S. Postal Service Office of Inspector General (OIG) considers management’s comments responsive to all recommendations except for recommendations 4 and 5, which we consider partially responsive. For the others, the corrective actions should resolve the issues identified in the report.
Every OIG report details failures by management to essentially do their jobs. It’s a broken record. Now, however, the question that creeps in the back of one’s mind is if these people got bonuses. Obviously they shouldn’t, but no one would be surprised if they did. That, in a nutshell, is the current state of the USPS.
is this “highway contract drivers”
They submit bids to say how much they want to
deliver the mail.
One in our office says it takes him 11 hours a day.
He makes over 100K!!!! Done my noon everyday.
Doesn’t deliver anything that doesn’t fit into a mailbox??
Customers hate him. They have to come in to get
everything????
We are a sinking ship. And the captains are out searching
for icebergs to slam into!!!!
Good luck with that!!!!
The captain and first mate are too old. They need younger people who actually have new ideas and are not quite so myopic.
Tulino won’t be going anywhere this year, unfortunately, because of his retention agreements: $100K on 03/01/26 (already passed) and $100K on 12/31/26 as long as he remains employed by the Postal Service as of those dates. These will be paid into his interest-bearing deferred compensation account. (Data Source: Form 8-K 12/09/25)
He’s almost 70 years old and has been with USPS since 1980. I dare say these “retention” agreements are to compensate him (at least in part) for staying and holding down three positions (DPMG, COO, and CHRO).
The Senate Homeland Security Committee probably didn’t have this particular information when questioning PMG 76.
First it was bonuses for failure, now it’s retention payments for failure. This guy, perhaps more so than Steiner, is responsible for the dysfunction and incompetence found at the highest levels of the USPS. He’s milked it long enough.
Well…he also received $200K in retention payments in CY 2025. (Data Source: Form 8-K dated 05/29/25)
Many people believe he is part of a high-paid executive tier that hasn’t successfully resolved the agency’s core issues of delayed mail and falling revenue. Executive decisions are detached from public interest and reality. Liquidity keeps falling and field operations are having to bear the brunt of cost-cutting while he continues to rake in these retention bonuses.