1. ® Sausalito Main Post Office Council Meeting May 7, 2013

2. 2 Financial Climate of Postal Service Volume Price Labor Costs Universal Service Obligation  Non-competitive services capped by rate of inflation Postal network driven by:  Delivery points  Retail locations  Mail processing facilities  Unique future retiree prefunding obligation These trends will continue to put pressure on USPS’s ability to provide affordable universal service Decliningsteadily  Total mail volume decline of 27% since 2006  Drop of 53 billion pieces in the last 6 years  Mail mix changes – lower profit contributions Fixed Cost Base Rising but capped capped Legislationneeded

3. 3  $15.9 billion net loss in FY2012  $1.3 billion loss QTR1 – Oct/Dec  Net loss of over $40 billion in the past six years, despite removing nearly $15 billion from cost base during the same period Financial Climate of Postal Service

4. 4  Since 2006:  Reduced the size of the workforce by 193,000 employees through attrition  Goal is to reduce our career workforce to 400,000 through attrition  Reduced our cost base by $15 Billion  Consolidated more than 200 mail processing facilities  Modifying operating hours at over 13,000 Post Offices (POSt Plan)  Reduced some 21,000 delivery routes  Provided increased access to Postal products and services  100,000 locations plus the internet Financial Climate of Postal Service

5. 5 Initiated in 2009  National  575 Studies  186 Owned Buildings  434 Leased Building Optimization Results NET SPACE REDUCTION = 14 MILLION SQUARE FEET

6. 6 Relocate Delivery and Lease Back at Current Location Dana Pint MO 18,496 sf Sell Establish New Dana Point Post ~11,00 SF

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8. 8  Annual Operating Savings  Utilities  Maintenance  Cash Gain  etail Access Points Remain the Same  Property Goes Back on Tax Rolls  No Impact to the Customer  Position Neutral Floor Plan

9. 9  Close Escrow May 16, 2012  Move Carriers to Mill Valley  Renovate Sausalito Post Office for New Retail  New Retail Unit Open For Business There Will Be No Break In Service! Next Steps

10. 10 Example: Sunnyvale, California Modern Retail Service Design (Photo credit: JEF)

11. 11 Example: Sunnyvale, California Modern Retail Service Design (Photo credit: JEF)

12. 12 Example: Sunnyvale, California Modern Retail Service Design (Photo credit: JEF)