Nonprofits Respond to 'No-Adjective' Rule

The U.S. Postal Service issued a ruling in the Federal Register in March regarding the eligibility requirements for certain nonprofit Standard-Mail rates, known as the “no-adjective rule.”

The official rule, called the “permissible reference rule,” was passed in November 1990 and stated that nonprofit organizations could not include ads, promotional material or adjectives such as “low cost,” “very competitive” or “designed with members' needs in mind” when referring to members' benefits. The new ruling states that nonprofits are allowed to use these adjectives to describe members' benefits and will be eligible for reduced mailing rates as long as the description makes up less than 50 percent of the mailing piece.

This issue raised the ire of many nonprofit organizations, who thought the USPS was “nitpicking” in searching through their mail looking for such adjectives and ruling that those who used them in relation to their purpose or mission were not eligible for reduced rates.

Nonprofit organizations had a month to submit letters to the USPS to voice their opinions on the new ruling. The USPS is taking the opinions into consideration and will decide whether to revise the newest version before issuing the final ruling, which it hopes will be sometime this month.

Here are excerpts from some of the letters that were submitted:

Neal Denton, Alliance of Nonprofit Mailers: We are concerned that the rule would create an overly narrow definition of a membership solicitation or renewal mail piece. (The Federal Register notice defines such mail pieces twice: once in the body of the notice, “provided it can be determined by an actual measurement that the piece is primarily a solicitation for new members or a renewal offer,” and once in the proposed rule, “the solicitation or renewal request … is considered to include only a printed letter to … [potential members].”)

This definition rules out a number of nonprofit mailers who operate under a monthly dues cycle and often communicate with their members via publications that would not meet the strict “printed letter” or “primarily a solicitation” definition.

There is no mention of a “letter shape” requirement in the legislation. While many nonprofits do use this approach in their solicitation pieces, it seems to be an unnecessary addition that may only necessitate future confusion and ruling by USPS officials. In essence, the USPS is proposing creative control over nonprofit fundraisers. We assume this restriction was intended to provide ease of administration, but the result is that it weakens the policy.

Lee Cassidy, National Federation of Nonprofits: While we understand the intention and import of the proposed rule, the notice does not state that affinity credit cards, travel programs or insurance may be advertised. We believe the “safe harbor” nature of the proposed rule would be clearer if published commentary on the rule used specific examples of acceptable practice. As we have stated many times, the words “credit card” are inadequate description to actually serve to advertise the benefit. It is necessary to identify which credit card is being discussed, and we believe commentary on the final rule should specifically say that it is permissible to say “Duke Alumni Association Visa card.”

It is common (and necessary) practice for nonprofit membership organizations to remind members from time to time of the availability of many benefits. Members do not necessarily sign up for a full range of benefits when joining the organization; rather, do they more usually make piecemeal decision during the year(s) to enjoy new or additional benefits. Moreover, membership organizations often add or change benefits in midyear.

Therefore, we believe the rule should not restrict advertising of benefits in a minor way to “annual” or any other periodical solicitation.

John C. Bennison, American Society of Travel Agents Inc.: Based on ASTA's continued concerns regarding postal abuses by nonprofits, we encourage the USPS not to revise or change the current provision in allowing “promotional” material pertaining to travel and tours as eligible matter in promoting membership benefits for a nonprofit organization.

ASTA believes the current provision is fair and a positive step in correcting the abuses in the marketplace at this time. Clearly, this provision has been effective; otherwise, nonprofit entities would not be asking the USPS to soften its regulation to the point that it will no longer serve as a barrier for nonprofits who want special Third-Class bulk rates to promote their travel and tourism programs. ASTA adamantly opposes changing the eligibility requirements for certain nonprofit Standard-Mail-rate matter.

Gary Hubbard, United Steelworkers of America: We commend the USPS for addressing a long-overdue streamlining of rules. However, we are concerned the proposal disregards the USWA and other nonprofit organizations that operate under a monthly dues cycle. The USWA does not send solicitation letters for new membership or membership renewal. All our efforts to solicit and renew memberships are contained in newsletters of varying size and frequency in which we publish items of interest to USWA members, including educational material, negotiations and benefits offered as a result of negotiations.

The Federal Register notice addresses solicitation letters only. Since the USWA doesn't communicate with members by solicitation or renewal letter, the proposed streamlining of the adjective rule should apply to a clearly identified section of a newsletter as well, when mailed at the Standard (A) Periodical Special Rate. We hope that USPS will take note of our objection and incorporate our suggested remedy in the final rule.

Claude Evans, Nevada State AFL-CIO: The organizations we represent all have monthly dues and do not send solicitation letters for new membership or membership renewal. All our efforts to solicit and renew membership are contained in newsletters of varying size and frequency in which we publish items of interest to union members, articles on safety, education items, articles of public interest, information about negotiations, dues schedules or dues increases and benefits frequently offered as a result of such negotiations.

Diane S. Curry, Transportation-Communications International Union: Specifically, the proposed new rule would allow nonprofit organization mail to “describe” membership benefits if the description is a “minor” part of the “solicitation for new members or a renewal offer.” However, the rule change covers letters only — not newsletters or circulars. While this limitation may be advantageous for nonprofit organizations operating on an annual membership renewal basis, it is clearly discriminatory against nonprofit organizations that operate on a monthly dues structure and therefore solicit new members or renewals in their monthly newsletters.

Sharon Wright, American Federation of Teachers: While the proposal does make the rules somewhat easier to understand, it seems to ignore those nonprofit organizations that operate under a monthly dues cycle. All of our members pay their dues monthly to their local, who in turn pays dues to the AFT. We do not send out solicitation letters for new memberships or membership renewal. All of our efforts to solicit and renew membership are contained in newsletters or newspapers of varying size and frequency.

Steven Zaleznick, American Association of Retired Persons:

The proposed rule and supplementary information should be revised to make clear that substantially related services and benefits, including but not limited to an organization's publications, newsletters, workshops and seminars, are not counted as part of the 50 percent “minor part” of the solicitation.

First, the proposed rule should not be limited to a “printed letter” (or the alternative one-page sheet accompanying a printed letter). Such limitations effectively prohibit a nonprofit from using such formats as double-sided postcards, teasers on envelopes, brochures, lift notes, fliers and self-mailers, among others.

Second, just as a nonprofit organization should not be restricted from formatting its communication as a “flier” vs. a “letter,” it should not be penalized for presenting its communication in three elements (i.e., a card, one-page information sheet and one-page letter) rather than a single three-page letter.

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