E7-19151. New Move Update Standards for First-Class Mail and Standard Mail

AGENCY:

United States Postal Service.

ACTION:

Final rule.

SUMMARY:

The Postal Service^TM is extending its effort to improve the percentage of deliverable mail by revising Move Update standards in the Mailing Standards of the United States Postal Service, Domestic Mail Manual (DMM). The Move Update standards provide ways for mailers to reduce the number of mailpieces that require forwarding or return by the periodic matching of a mailer's address records with customer-filed change-of-address orders. Our final rule includes the following changes related to Move Update processing: increase the minimum frequency of Move Update processing from 185 days to 95 days prior to the date of mailing and extend the revised Move Update requirement to include all Standard Mail.

EFFECTIVE DATE:

November 23, 2008.

FOR FURTHER INFORMATION CONTACT:

Charles B. Hunt, 901-681-4651; or Bert Olsen, 202-268-7276.

SUPPLEMENTARY INFORMATION:

On May 23, 2007, we published a proposed rule in the Federal Register (72 FR 28908-28911), about two initiatives: (1) Extending the Move Update requirement to all Standard Mail and, (2) increasing the minimum frequency of Move Update processing from 185 days to 95 days prior to the date of mailing. The revised timeframe also will apply to all pieces in Standard Mail mailings. The proposed notice also invited public comment concerning the changes. The Postal Service received eight customer comments on the proposals.

We believe that the revised standards in this final rule are crucial to the continued vitality of the postal system as well as the business interests of mailers. In Fiscal Year 2004 the Postal Service handled 9.7 billion pieces of Undeliverable-as-Addressed Mail (UAA) mail at a cost of $1.979 billion dollars. This change will result in better address quality by removing incorrectly addressed pieces from subsequent mailings, which will reduce UAA mail.

In cooperation with the mailing industry, we are committed to reducing UAA mail volume in order to create and maintain a cost-efficient mailstream. Over the years, we have invested heavily in creating an automated mailstream to help drive costs out of the delivery system. However, an efficient automated mailstream works best when mailpieces have complete, correct, and current addresses. As discussed in the proposed rule, revisions to the Move Update standard are needed to improve the percentage of deliverable addresses for mailings entered at discounted rates. High quality addressing, best possible depth of ZIP+4 Codes, and accurate barcodes that result in the delivery of the mailpiece to the intended recipient in an efficient manner, should be primary tools that mailers use to reduce UAA mail volume.

In addition to revisions to DMM standards, the proposed rule also addressed the timing of the changes. When the Move Update requirement for First-Class Mail was instituted in 1997, a 9-month readiness period was provided. The Postal Service recognizes the magnitude of the adjustments to be made by the mailing industry to implement the revisions in this notice and believes that an 18-month period from the date of proposed rulemaking notice (May 23, 2007) to implementation of the changes provides ample time. The Postal Service also believes that the changes improve the overall cost effectiveness of mail delivery and contribute to rate stability and do not create unreasonable barriers to discount rate qualifications.

Part A of this final rule summarizes the new requirements and provides an analysis of the eight comments received to the Proposed Rule Notice. Part B contains the text of the proposed DMM standards.

Part A

1. Move Update Requirement for All Standard Mail

The Move Update standard, which previously applied only to First-Class Mail, will be extended to include all Standard Mail. A key reason for this extension is that one of the conclusions of an independent study of the cost, volume, and characteristics of UAA mail pointed out that mail entered as Standard Mail accounted for 62.8 percent of all UAA mail volume.

Two commenters expressed full support for the proposed expansion of the Move Update requirement beyond presorted and automation rate First-Class Mail to Standard Mail. However, several commenters voiced concerns or made alternative recommendations regarding the proposed expansion.

One commenter voiced concern regarding the difficulty of complying with the Move Update requirement for small local businesses and nonprofit organizations. The Postal Service feels that there are many methods mailers can use in order to qualify and make this fit any business model. The list of authorized methods upon implementation of these requirements will include the following:

NCOA^Link processing

FASTforward MLOCR processing (for letters)

Address Change Service (ACS)

On-piece ancillary service endorsements, except “Forwarding Service Requested”

Additionally, two commenters proposed postponing implementation until the benefits of the recent CASS^TM Cycle L changes, which were effective August 1, 2007, are realized. CASS Cycle L requires the integration and use of Delivery Point Validation (DPV^TM) and Locatable Address Conversion System (LACS^Link TM) as part of CASS certification and processing in order for mailers to be eligible for automation discounts. Most UAA mail is attributed to Standard Mail move-related reasons. CASS Cycle L changes do not affect move-related UAA problems.

Another commenter expressed concern that the alternative Move Update method was not listed as a stand-alone option to meet the Move Update requirement for Standard Mail. The alternative method is allowed for First-Class Mail due to mailer's concerns about incorporating change-of-address information into their mailing lists for mailpieces containing personal information. Therefore, the Postal Service does not consider alternative methods applicable to Standard Mail. However, addresses that have been processed through any Move Update method, including alternative methods for First-Class Mail, automatically meet the Move Update standard for Standard Mail. And lastly, one commenter asked if addresses received directly from their customers or clients may be claimed within a mailing at the First-Class Mail or Standard Mail discounted rates. The answer is yes, if mailed within the first 185 days of acquiring the address. When this final rule is implemented, the current requirement to perform Move Update processing within 185 days before mailing will be changed to 95-days.

As information, in addition to the four authorized Move Update methods listed above, addresses utilizing any of the three alternative addressing formats in DMM 602.3.0 (for example, “John Doe or Current Resident,” “Occupant,” “Postal Customer” etc.) will not be subject to the Move Update standard.

2. Frequency of Use of Move Update Processing

The Postal Service will increase the minimum frequency of Move Update processing from 185 days to 95 days prior to the date of mailing for First-Class Mail and for Standard Mail.

Two commenters voiced general support for the proposal, but expressed concerns about the 95-day window for processing addresses. One suggested keeping Move Update processing for First-Class Mail at 185 days and requiring Move Update processing for Standard Mail at an annual interval. The other commenter suggested requiring Move Update processing within 120 days instead of 95 days, asserting that the reduced window for processing will have a negative effect due to the planning cycles in use by many mailers.

We understand that certain operational changes may be necessary for the mailing industry to implement this proposal. However, the UAA mail problem is of such magnitude that it is in the best interests of all stakeholders to modify current practices in order to mitigate the problem. We also recognize that some mailers who are successfully reducing UAA mail within their operations have already set quarterly production cycles for their Move Update and Address Matching processing.

Reducing the processing window from 185 days to 95 days prior to the mailing date will lessen the effect of the natural deterioration of address currency, resulting in a significant decrease in UAA volume and the costs associated with the redirecting, re-handling, and disposing of mail.

Part B

Effective November 23, 2008, we will adopt the following amendments to the Mailing Standards of the United States Postal Service, Domestic Mail Manual (DMM), incorporated by reference in the Code of Federal Regulations. See 39 CFR 111.1., 111.4.

List of Subjects in 39 CFR Part 111

• Administrative practice and procedure
• Postal Service

Accordingly, 39 CFR part 111 is amended as follows:

PART 111—[AMENDED]

1. The authority citation for 39 CFR part 111 continues to read as follows:

Authority: 5 U.S.C. 552(a); 39 U.S.C. 101, 401, 403, 404, 414, 3001-3011, 3201-3219, 3403-3406, 3621, 3626, 5001.

2. Revise the following sections of the Mailing Standards of the United States Postal Service, Domestic Mail Manual (DMM), as follows:

* * * * *

200 Discount Letters and Cards

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230 First-Class Mail

233 Rates and Eligibility

* * * * *

3.0 Basic Standards for First-Class Mail Letters

* * * * *

3.5 Move Update Standard

3.5.1 Basic Standards

* * * * *

[Revise item a in 3.5.1 as follows:]

a. Each address and associated occupant name used on the mailpieces in a mailing must be updated within 95 days before the mailing date, with one of the USPS-approved methods in 3.5.2.

* * * * *

[Revise item c in 3.5.1 as follows:]

c. The Move Update standard is met when an address used on a mailpiece, in a mailing at any class of mail, is updated with an approved method in 3.5.2, and the same address is used in a First-Class Mail mailing within 95 days after the address has been updated.

* * * * *

240 Standard Mail

243 Rates and Eligibility

* * * * *

3.0 Basic Standards for Standard Mail Letters

* * * * *

[Add new item 3.9 as follows:]

3.9 Move Update Standard

3.9.1 Basic Standards

The Move Update standard is a means of reducing the number of mailpieces in a mailing that require forwarding, return, or discard by the periodic matching of a mailer's address records with customer-filed change-of-address orders received and maintained by the USPS. For the purposes of this standard, “address” means a specific address associated with a specific occupant name. Addresses subject to the Move Update standard must meet these requirements:

a. Each address and associated occupant name used on the mailpieces in a mailing must be updated within 95 days before the mailing date, with one of the USPS-approved methods in 3.9.2.

b. Each individual address in the mailing is subject to the Move Update standard.

c. The Move Update standard is met when an address used on a mailpiece, in a mailing for any class of mail, is updated with an approved method in 3.9.2, and the same address is used in a Standard Mail mailing within 95 days after the address has been updated.

d. Except for mail bearing an alternative address format, addresses used on pieces claiming Standard Mail rates, regardless of any required surcharge, must meet the Move Update standard.

3.9.2 USPS-Approved Methods

The following methods are authorized for meeting the Move Update standard:

a. Address Change Service (ACS).

b. National Change of Address Linkage System (NCOA^Link).

c. FASTforward MLOCR processes if used each time before mail entry (for letter mail only). If a mailpiece that initially uses FASTforward MLOCR processing is rejected and then entered into a Direct View Encoding Desk (DVED) operation (or similar system), the piece does not meet the Move Update standard. The name and address information on the piece must then be processed through a FASTforward RVE system to meet the Move Update standard. FASTforward RVE processes also meet the Move Update standard if used each time before mail entry.

d. Ancillary service endorsements under 507.1.5.3, Standard Mail, except “Forwarding Service Requested.”

3.9.3 Mailer Certification

The mailer's signature on the postage statement certifies that the Move Update standard has been met for each address in the corresponding mailing presented to the USPS.

* * * * *

300 Discount Flats

* * * * *

330 First-Class Mail

333 Rates and Eligibility

* * * * *

3.0 Eligibility Standards for First-Class Mail Flats

* * * * *

3.5 Move Update Standard

3.5.1 Basic Standards

* * * * *

[Revise item a in 3.5.1 as follows:]

a. Each address and associated occupant name used on the mailpieces in a mailing must be updated within 95 days before the mailing date, with one of the USPS-approved methods in 3.5.2.

* * * * *

[Revise item c in 3.5.1 as follows:]

c. The Move Update standard is met when an address used on a mailpiece, in a mailing for any class of mail, is updated with an approved method in 3.5.2, and the same address is used in a First-Class Mail mailing within 95 days after the address has been updated.

* * * * *

340 Standard Mail

343 Rates and Eligibility

* * * * *

3.0 Basic Standards for Standard Mail Flats

* * * * *

[Add new item 3.9 as follows:]

3.9 Move Update Standard

3.9.1 Basic Standards

The Move Update standard is a means of reducing the number of mailpieces in a mailing that require forwarding, return, or discard by the periodic matching of a mailer's address records with customer-filed change-of-address orders received and maintained by the USPS. For the purposes of this standard, “address” means a specific address associated with a specific occupant name. Addresses subject to the Move Update standard must meet these requirements:

a. Each address and associated occupant name used on the mailpieces in a mailing must be updated within 95 days before the mailing date, with one of the USPS-approved methods in 3.9.2.

b. Each individual address in the mailing is subject to the Move Update standard.

c. The Move Update standard is met when an address used on a mailpiece, in a mailing for any class of mail, is updated with an approved method in 3.9.2, and the same address is used in a Standard Mail mailing within 95 days after the address has been updated.

d. Except for mail bearing an alternative address format, addresses used on pieces claiming Standard Mail rates, regardless of any required surcharge, must meet the Move Update standard.

3.9.2 USPS-Approved Methods

The following methods are authorized for meeting the Move Update standard:

a. Address Change Service (ACS).

b. National Change of Address Linkage System (NCOA^Link).

c. Ancillary service endorsements under 507.1.5.3, Standard Mail, except “Forwarding Service Requested.”

3.9.3 Mailer Certification

The mailer's signature on the postage statement certifies that the Move Update standard has been met for each address in the corresponding mailing presented to the USPS.

* * * * *

400 Discount Parcels

* * * * *

430 First-Class Mail

433 Rates and Eligibility

* * * * *

3.0 Basic Standards for First-Class Mail Parcels

* * * * *

3.5 Move Update Standard

3.5.1 Basic Standards

* * * * *

[Revise item a in 3.5.1.as follows:]

a. Each address and associated occupant name used on the mailpieces in a mailing must be updated within 95 days before the mailing date, with one of the USPS-approved methods in 3.6.2.

* * * * *

[Revise item c in 3.5.1 as follows:]

c. The Move Update standard is met when an address used on a mailpiece, in a mailing at any class of mail, is updated with an approved method in 3.6.2, and the same address is used in a First-Class Mail mailing within 95 days after the address has been updated.

* * * * *

440 Standard Mail

443 Rates and Eligibility

* * * * *

3.0 Basic Standards for Standard Mail Parcels

* * * * *

[Add new item 3.9 as follows:]

3.9 Move Update Standard

3.9.1 Basic Standards

The Move Update standard is a means of reducing the number of mailpieces in a mailing that require forwarding, return, or discard by the periodic matching of a mailer's address records with customer-filed change-of-address orders received and maintained by the USPS. For the purposes of this standard, “address” means a specific address associated with a specific occupant name. Addresses subject to the Move Update standard must meet these requirements:

a. Each address and associated occupant name used on the mailpieces in a mailing must be updated within 95 days before the mailing date, with one of the USPS-approved methods in 3.9.2.

b. Each individual address in the mailing is subject to the Move Update standard.

c. The Move Update standard is met when an address used on a mailpiece, in a mailing for any class of mail, is updated with an approved method in 3.9.2, and the same address is used in a Standard Mail mailing within 95 days after the address has been updated.

d. Except for mail bearing an alternative address format, addresses used on pieces claiming Standard Mail rates, regardless of any required surcharge, must meet the Move Update standard.

3.9.2 USPS-Approved Methods

The following methods are authorized for meeting the Move Update standard:

a. Address Change Service (ACS).

b. National Change of Address Linkage System (NCOA^Link).

c. Ancillary service endorsements under 507.1.5.3, Standard Mail, except “Forwarding Service Requested.”

3.9.3 Mailer Certification

The mailer's signature on the postage statement certifies that the Move Update standard has been met for each address in the corresponding mailing presented to the USPS.

* * * * *

Neva Watson,

Attorney, Legislative.