USPS' Revenue Tactics Come Under Fire

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Direct marketers are increasingly speaking out against the U.S. Postal Service's revenue assurance efforts that are under way around the country.


USPS' program - managed under its revenue assurance department - is designed to track the postage paid by major mailers. From its previous internal focus, the department switched gears last year to focus on periodical mailers, First-Class mailers and Standard-A mailers. A team of more than 100 analysts tracks mail preparation, content rule compliance, required updates on software and payments.


To date, the group has found 1,900 deficiencies this year.


Direct marketers are angry at follow-up reviews on mailings already accepted by the USPS and the additional postage payments required when postage assessments are made for mailings dropped many months or years back.


"While mailers are very aware of their responsibility to properly prepare mailings and pay the appropriate postage for the rates claimed, it may be impossible for a lettershop to produce the necessary documentation for all aspects of the mailing," said Barry Brennan, director of postal affairs for the Mail Advertising Service Association, Alexandria, VA. "And it may be impossible for the lettershop to go back to the owner of the mail to collect additional postage charged for issues outside of the control of the mail preparer."


Jerry Cerasale, senior vice president of the Direct Marketing Association, agreed with Brennan.


"We believe that mailers should pay the proper amount of postage, because if they don't, the postal service would be in a shortfall and they may have to increase rates sooner," he said. "But, we think that forcing mailers to go back, dig up all documentation without the mailings can become a burden and a scare tactic."


Cerasale excludes mailers with systematic problems such as R.R. Donnelley & Sons Co., Chicago, which recently agreed to pay the USPS $22 million for underreporting and underpaying postage on thousands of catalog and periodical mailings since August 1989.


The USPS insists that it's not doing anything wrong - it's simply trying to solve some common problems in the industry and tighten up its processes.


"We're not trying to be unfair to people," said M. Richard Porras, senior vice president and chief financial officer at the postal service. "We just want to get paid for the services that we provide."


He said the agency has cut its back-check time frame down to two years from four years. Also, "I've agreed that in about six months, I'll look at that time frame again and, if it looks unrealistic, we'll look to see if we can shorten it," Porras said.
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