USPS Simplifies Nonprofit Eligibility Process

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The U.S. Postal Service announced a new regulation on Friday that should significantly simplify the process that allows Nonprofit Standard-A mailers to receive nonprofit rates.

The new regulation, which amends the Domestic Mail Manual, makes mailers certify that their mail pieces qualify for nonprofit rates by signing a certification at the bottom of their postage statement. The certification states that all the products or services offered in their mailpieces meet the "substantially related" requirements of nonprofit mailers, and is a pure nonprofit organization. Prior to this ruling, postal officials had the final say in deciding if an organization was a pure nonprofit one or not.

"This is great news," said Amy E. Gotwals, assistant director of the Alliance of Nonprofit Mailers. "It's one less time where a postal official is going to try and second-quess a nonprofit's mission."

The certification will initially be voluntary, but will become mandatory when new rates, as a result of the requested rate increase now being considered by the Postal Rate Commission, become effective, probably in January or February 2001.

According to insiders, this new regulation will mean far fewer cases of disagreement between mailers and the USPS, and will result in far fewer cases of revenue deficiencies affecting acceptance of Nonprofit Standard-A mail.

The certification, which must be signed by the mailer or his agent, will state, among other things: That income from the sale of products or services advertised is not subject to Unrelated Business Income Tax; the products or services are substantially related to the organization's nonprofit purpose; that only the mailer's materials are being mailed; that the mailing is not a cooperative mailing with unauthorized persons or organizations; and the mailer agrees to be liable for any revenue deficiencies if later assessed.
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