$100 remain in their drawers. They have to deposit every dime over the amount. Mr. FAZIO. That is a new system you put in place? Mr. ROTA. Brand new. When the system is complete, as I understand it, receipt comes to us, a receipt remains with them, and one goes downtown with the Post Office. Mr. FAZIO. How typical is that of other postal facilities in the way they are? Mr. ROTA. I have no idea. Mr. LEWIS. When did you come in as postmaster? Mr. ROTA. Twenty years ago. Mr. LEWIS. If eight years ago, instead of having that computer and deposit relationship, the cash was stored in a drawer, that might be a different circumstance, and I would like to know about that circumstance. Mr. ROTA. Well, see, that is what I wanted to know. I needed help to do that, and the Postal Service could not release the amount of employees that I needed to do this. This takes a tremendous amount of employees, because I felt all stations should be shut down at once. They said, "Bob, we can't do that, we don't have that kind of money." So then I went to Jack, and Jack was very helpful, I think, but his people weren't qualified in the accounting to conduct this type of an audit, so that is why the Postal Service then later agreed to help us. Mr. FAZIO. The GAO might have been a good place to go, too. Mr. ROTA. Since then, I have talked to Steve and the leadership and all. We are now doing audits monthly. Mr. FAZIO. It sounds like you are on top of the problem. Mr. ROTA. Should one person just fool with their machine-the experts downtown, if we don't catch it, downtown is going to catch it. There is only one way that a person could really take funds, is if they sell a large volume of stamps late in the evening and they fail to record that. But that machine, if they go into that machine or out of that machine, or take from that machine, that machine is going to let us know what happened. COMPARABILITY OF HOUSE P.O. WITH OTHER POST OFFICES Mr. FAZIO. I would like to know whether or not the procedures you have implemented are on the cutting edge of what other post offices are doing. You know, I don't want it to be said that we were not as careful about expenditure of funds as other entities. I certainly don't want the implication that we were less attentive to potential theft from our employees than an average post office in this country. I do want to make it clear, because there may be some people here who haven't gotten this, that the funds in question were not funds that we appropriate from this Committee, they were typically the revenues from stamp and money order sales, they are Postal Service funds which you, in effect, administer. Mr. ROTA. Right. Mr. FAZIO. As any Postmaster in the country would. Mr. LEWIS. I certainly don't want to impugn the responsibility or cerned about agencies that we have responsibility for, and one of the people I trust the most around here, recently, two days ago, went into the Post Office for X service, and there was what appears to be a relatively low-level clerk handling that service, and when that person opened the drawer, there is three stacks of $20 bills, there is a check over here that is being put in another location, it did not look to be like a money orderly operation. Mr. ROTA. I sympathize with you on that, and I work very hard with Mr. Brooks and his Committee, and I really want to thank Bernie Muller. He has been a really big help to us. He has been working with me. I don't know maybe we are going to have to go to a permanent career-type employee for these positions. I don't know, but we are looking into that. Let me get back to one thing. Mr. FAZIO. Well, again, before you go on, is that procedure-I don't know what Mr. Lewis is referring to is that procedure and the handling of money any different Mr. ROTA. We can't find anybody to do the job. Mr. FAZIO. Let me finish, Bob. Is it any different than would appear in the window or in any post office in America? Mr. ROTA. The procedure of the $20 bills? Mr. FAZIO. Where we appeared not to have the type of control on money. Mr. ROTA. I am sure they have that problem in the post office, too. Sooner or later, an employee like that is going to come up short. We are going to have to audit them, check them out or dismiss them. Under the new system, I don't know where he-what he was talking or what department of mine that he was in, but under the new system, he shouldn't really do that because we went through all kinds of trouble to provide them with computers and everything to handle their accountability. If he did do this, he was doing it in violation of the rules that were set. The Postal Inspectors commended us for taking the steps that we did take. We went beyond what they ever expected us to do. They never, ever even dreamt that we would go as far as we did go to protect that money. Mr. FAZIO. So stipulated. We appreciate what you have done since this revelation became knowledge to you. This information is something that I would like to have had, and I think Mr. Lewis and I share a concern that even though these are not appropriated funds, we would have wanted to know more about this than what we are handed during a hearing on the day in which your budget is presented to the Committee. Now, I don't know that it is your responsibility, but it is somebody's responsibility to have enlightened us as to what might have appeared in the Washington Times yesterday, let alone today, and I am just making that statement, period. I don't appreciate finding out about these things on the day your budget is presented to the committee, period. I may be saying this to Steve and to others as well. I think the Committee deserves more input from people who have a clear knowledge of the situa I am not being critical of the way you have responded. On the other hand, I would like to be laudatory about that. Mr. ROTA. I understand. Mr. FAZIO. But we know, whether or not these are appropriated funds, this Committee is going to take some responsibility for whatever malfeasance or simple ineptitude exists in the post office, regardless of whether it was with stamps or whether it was appropriated funds. We are a political body. The reason this is getting this kind of attention is because it is our post office, not a post office in Annandale or Anacostia. Mr. ROTA. I understand that, and I agree with you. Mr. FAZIO. People want to kick this institution around because it is the Congress, the House of Representatives, not because there are four individuals who probably got in trouble financially and figured out they could embezzle some money. That would never reach even this level of the Washington Times story. Mr. ROTA. I am sorry. I never intended to overlook you at all. I would have never done that, I am not that way, and you know by now. Mr. FAZIO. I know that, that is why I am talking beyond you. Mr. ROTA. I was under the assumption that I had done everything that I should have done. Mr. FAZIO. I don't mean to say you haven't handled the problem right within the post office. I think you probably have, based on what you have told us. I am talking about this Committee's prerogatives and what we would value in terms of having input about the problem, what we would call in the vernacular a "heads-up". POST OFFICE PERSONNEL Mr. LEWIS. Mr. Chairman, just one minor addition. I think it is important for you to know, Bob, that I have many questions about procedure, processes for control. I have more questions there than I do about the level or the quality of personnel. [Questions and responses follow:] Question. The Postmaster's request for 1993 has increased almost one-third over last years appropriation. With the budget restraints we have this year, what are your biggest priorities in this years request? Response. Other than the mandatory changes, the top priorities are the additional positions requested to operate the new machinery and the night differential, both of which are before the Committee on House Administration for approval. Question. The new machinery in the Postmaster's office for faster mail processing, was suppose to cut down on the number of manual postal workers doing the job. Why then are there 19 new positions needed, which are supposedly a direct result of the new machinery? Response. The Office of the Postmaster's initial request for automated mail sorting equipment was to handle two phases: one was the outgoing Mail Accountability, and the second was the Incoming Mail sortation. The Incoming portion of automation was to have freed enough mail clerks and primary mail clerks from their regular duties, that these employees could then be shifted to the Accountability phase of automation. Mail accountability, because it is a new duty and requires strict, accurate accounting of Members' mail, needs extra personnel to run its many new functions. My request was broken into these two phases with the Accountability portion accepted and the Income portion deferred for later consideration due to budgetary constraints. This has caused the Office of the Postmaster to have more duties and functions than my present staff could properly handle. Eighteen of those requested for the new responsibility of accounting and charging for any address corrections and/or postage due fees. Question. How much have we saved from franking reform? Response. The FY '91 expenditures for the House were $32,863,000. In a comparable year, FY '89 expended $57,221,000. Therefore, a savings of approximately $24,358,000 has been recognized. Question. What is the current status of the federal probe investigating the Postmaster's office? There have been charges of embezzlement and theft of thousands of dollars by employees of the Postmaster's office? Response. The Postal Service Inspection Service cannot comment except on the audit report itself because additional matters are currently being investigated and the Postal Service cannot comment on any ongoing investigations. Mr. LEWIS. I mean, after all, we have personnel who are relatively low-paid personnel handling cash all across the country, and at post offices around America and at banks around America, procedures and processes allow people to make sure that money is controlled effectively. We don't have to raise people's salaries or bring someone's AA in to be the person to control that. The questions lie, for me at least, in a different direction than that. I am not here to criticize personnel, but rather to try to get to the bottom, and make sure I understand our responsibility and how they are being handled as well. Mr. ROTA. In our meeting, with the help of Mr. Ross and others, I can assure you one thing, the steps that have been taken now are probably far greater than has probably been taken anywhere else to assure this money is secure. In fact, yesterday, I had a meeting with a bank, and I asked them what is their procedure, what do they do with their tellers, and how do they assign the cash to them, and how they are responsible for turning it back. They said they would give me some recommendations and see. At that point, then, I would meet with Mr. Ross, the Postal Inspectors, to see if we could apply these procedures to ours and have the people legally bonded. Now the only thing they could take is $100 at the most. We give a leeway of $25, because if there is a large sale at night and we have closed our books the $25 rides over and they are to notify the Clerk in charge immediately. After a daily stamp order the Clerk's drawer never has an amount of cash in excess of over $100. Mr. ROTA. And we also reduced the accountability of all the drawers to a $5,000 base. Mr. FAZIO. Would you give us some estimate from your perspective-maybe Steve could help as to what losses were real here? I mean, obviously, there seems to be some hyperbole. What is your understanding of what actually may have occurred in dollar terms? Mr. ROTA. Nancy, do you have it? Ms. COLLINS. It is approximately $33,000. Mr. ROTA. I don't have the letter. It is in your book. Ms. COLLINS. The total shortage was approximately $37,000, but there was repayment of $4,000. Mr. FAZIO. It says here in its September 23rd, 1991 audit report, the Inspection Service said it had found $33,560 in cash was missing from the post office since the last audit in 1990. Mr. ROTA. That is it. Mr. Fazio. So that is the total amount that these four individuals Mr. ROTA. The next paragraph showed that one clerk had paid back the $4,000. Mr. FAZIO. Our debt is receding as these people take responsibility for back payment. Mr. ROTA. Yes. In 1973 we removed the bonding from all those people. Mr. FAZIO. All right. Any other questions for Bob? I am sorry, Bob, we had to go through this. I really regret Mr. ROTA. I think we have done a real good job. I really am proud of everybody, including Steve Ross. He put in many, many hours. We met late at night. NEED FOR VIGILANCE Mr. FAZIO. Yes. Well, I realize a lot of time has been spent and work has been put forth, and I hope there is a happy ending to what is an unfortunate episode in what has otherwise been a pretty good record of the postal operations here. Mr. ROTA. I felt very, very bad about this. One of the real top-notch inspectors who had been there for years and years, said, "Mr. Rota, you have gone beyond anything we ever expected you to do to stop this. However don't feel that you are safe, because if there is a way, somebody is going to try to steal again. They may not have”. Mr. FAZIO. "Vigilance" is always a good watch word here. We ought to be prepared for other people who don't have the best ethical standards. But again, if it is limited to a hundred dollars, we can't ask for much more. Mr. ROTA. It is a hundred dollars. We are doing audits now every month. It takes a lot of manpower. Mr. FAZIO. I hate to bring this up, but everybody can read this paper, so I will want to ask questions that relate to it. No Congressmen are being investigated at this point. Is there any reference at all, however, to Members of Congress in any of the work that has been looked at? Mr. ROTA. None. Mr. FAZIO. Has this been a place for Members to borrow money or bounce checks or anything of that sort? Mr. ROTA. No. I don't know how in the world they would be able to. We sell stamps. And where they got those figures, I have no idea, believe me. Mr. Fazio. All right. Thank you very much. We will work with you and Mr. Molloy and others to try to get a handle on this postal estimate. This will be our toughest year to come up with a figure that we can take to the Floor. Mr. ROTA. Thank you. Mr. FAZIO. Regardless of what we do, we will get it on the Floor, but we need to know what we believe is the accurate figure. Mr. ROTA. Thank you. Thank you for all your help. Mr. FAZIO. We will be more than happy to provide more if you ask us. |