Postal Official Discusses Consistency in First-Class, Standard Mail Acceptance

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WASHINGTON -- A postal official at the Mailers Technical Advisory Committee meeting yesterday articulated the U.S. Postal Service's intentions regarding a broader interpretation of First-Class mail being considered by postal officials that would move many Standard mail pieces into the costlier First-Class category.


Several mailers -- mainly financial institutions -- said they are being told by local acceptance clerks at postal business mail entry units that Standard mail they have sent for years now must go at the First-Class rate. First-Class mail is the agency's most profitable product but has been declining in volume.


Steve Kearney, vice president of pricing and classification at the USPS, made it clear that consistency was the main reason this was taking place.


"Consistency means a lot to me and to the postal service, as we know it does to all of you and to all of our customers," he said in a special appearance at the meeting at postal headquarters. "It is one of our top goals for this year and going forward."


Kearney explained that many years of making individual rules on individual mail pieces has led to very specific, fine differences among pieces that qualify for one class of mail or another. To fix this problem, "we are going to try to clarify the existing language that describes the distinction between what has to be mailed at First-Class mail versus what can be mailed at Standard mail," he said.


The existing rule has been in place a long time, Kearney said, but something happened in the early 1980s when the postal service actively encouraged customers to add more customizations to Standard mailings.


"While that's a good thing for the mail business," he said, "it's a bad thing for the way this rule is written because it makes every rule a little bit more difficult."


Postal officials are going to "try to find wording around the rule that makes it much more obvious to people," he said, adding that the change will appear in the Federal Register, possibly this spring, and that mailers will get a phase-in period to follow the rule.


In addition, Kearney said the USPS will have a centralized process for appeals to prevent inconsistencies. That's why the agency transferred authority for final decisions from rates and classification service centers to the manager of mailing standards at postal headquarters. The mailing standards manager will rule when a mailer appeals a classification or revenue-deficiency decision.


He also said the USPS and the mailing industry have formed a joint MTAC work group to study the issue. Meetings with mailing associations are scheduled, and postal employees are being trained and given consistency goals this year.


Mailers at MTAC had mixed reactions to the push to promote consistency and re-interpret the First-Class classification. Some were pleased that the USPS is centralizing the complaint process.


"I think having [a centralized process] is a good thing," said Peter B. Glenn, vice president and director of postal affairs at Bank of America, Charlotte, NC. "It will be good to know that one centralized office is in charge of the rulings as opposed to getting different interpretations from different RCSCs."


But most mailers were concerned with the new interpretation of the rules. One person said the topic was the main issue at a closed MTAC business meeting after yesterday's open session and that 40 people in attendance said they would be affected by a reclassification. They also were concerned that the USPS has pledged to look at other mail classes, such as Media Mail and Bound Printed Matter, the source said.


Kearney, however, said that though the USPS will centralize the rulings on other classifications, the First-Class/Standard issue is most critical right now "and what most people are talking to us about."


Another source said the new rules are a "thinly veiled attempt at revenue generation." The USPS may think that mailers who have mailed at Standard rates all along will comply and pay higher First-Class rates, he said, but many will simply "go out the door."


Bob McLean, executive director of the Mailers Council who was not in attendance at MTAC, agreed. He said mailers who have been loyal to the postal service might think that "if this is the way they are going to treat their best customers, we are going to move to the Internet."


But Kearney said a main reason for the change is that more appeals were coming to Sherry Freda's office -- the manager of mailing standards at USPS headquarters -- of rulings that were done at the RCSCs.


"What causes that is speculative," he said. "But that and many customers contacting me and [other high-ranking postal officials] about the issue raised it to our attention."


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