Understanding Postal: Biggest Rate Case Threat? Regulatory Changes

Usually when we talk about catalogs and postal rate cases, we tend to gloss over the many regulatory details that dictate how new rates will be implemented by the U.S. Postal Service. In many cases, these regulations can have an even greater impact on catalogers than the rates themselves. Regulations can add costs to mail preparation and can detail a host of reasons for not qualifying mail for entry at the most desirable rates.

Although some mailers are smart enough to read the rules the USPS proposes as its regulatory implementation plan, many don’t. For some inexplicable reason, they leave attending such details to their printers or other service providers.

Unfortunately, printers and service providers are like the tail on a dog; they can wag, but they can’t make the dog move once its paws have been set on the ground. There is one set of regulations that should be giving some mailers the willies: the regulations the USPS has planned governing mailer addressing practices.

Know and Use CASS

By now, every mailer should know that to qualify for the lowest possible automation rates, all addresses used in a mailing must be processed using CASS (Coding Accuracy Support System) certified software. CASS software generally is prepared by the USPS for more general use over periods called cycles. The next critical CASS cycle as far as the 2006 rate case (known as R2006) rates are concerned is the August 2007 cycle, also called the CASS Cycle L.

The timing of the release of this information to software providers is key. At least 90 days are needed to ensure the work will be done in time and with the quality it deserves. According to the current schedule, the CASS release is scheduled for May 1.

Unfortunately, the Postal Service has been signaling that it will implement the 2007 postal rate increases on May 6. That gives mailers precious little time to incorporate the necessary CASS Cycle L changes.

Today, the Postal Service allows mailers to use software to provide a ZIP + 4 code, if the address is valid within a range of addresses. When there’s an empty point within this range, it means there’s no deliverable address at that point.

As of Aug. 1, all addresses must be deliverable at what’s called the “primary” level, or house number. For multi-occupant buildings, the primary address consists of the base unit for that complex. Cycle L certification also will require a ZIP + 4 code only be assigned if the primary number can be validated against the delivery point validation (DPV) file. If the primary address can’t be verified, no ZIP + 4 can be returned, and the vendor will be required to use only a five-digit ZIP code. Pieces that can’t be coded with a ZIP + 4 code won’t be eligible for automation rates.

Also, Cycle L certification requires that all address databases be run against the LACSLink (Locatable Address Conversion System). The Postal Service uses the LACSLink file to convert rural addresses to city-style addresses and to update other address changes made by municipal authorities.

In July 2009, things will get more strict. Again, your addresses must be run through the CASS process. All addresses will have to be DPV-certified, and all addresses must be run against the LACSlink file. But here’s the kicker: If your addresses aren’t up to snuff, you’ll lose postage discounts for those pieces that wind up flunking address certification. They will be mailable only at the single-piece First Class mail rate.

Prepare Now

It’s time to get yourself ready. Virtually every mailing list today has some level of deficient addresses. Running your lists against the DPV and LACSLink files can help rectify some of your addressing problems. However, in most instances, you’d be better off using a full-service addressing service provider to flush away those addresses that could cause discount eligibility problems. These problem addresses process through other tools, using full-service providers.

The time you have left to convert your addressing model rapidly is running out. Keep in mind that taking care of your addressing issues today is more than a discount-eligibility exercise; add-ress improvement is an investment in your entire direct marketing activity. It vastly will improve your mail’s deliverability within today’s automation-driven mail processing environment. And that will do nothing less than lift your response and facilitate your data-mining operations.

In short, get on it. If you don’t, the price you’ll pay later truly will seem oppressive.

A Guide to Key Terms

CASS (Coding Accuracy Support System): A software program that’s designed to improve the accuracy of carrier route, five-digit ZIP code, ZIP + 4, and delivery point codes that appear on mailpieces. CASS is offered to all mailers, service bureaus and software vendors who want to evaluate their address-matching software and improve the quality of their ZIP + 4 and five-digit coding accuracy. The process is graded by the U.S. Postal Service and the USPS’ National Customer Support Center. The results are returned to mailers in order to provide useful diagnostics for correcting deficiencies.

CASS L Cycle: The next cycle, which will require that a ZIP + 4 code only be assigned if the primary number can be validated against the delivey point validation (DPV) file.

Delivery Point Validation (DPV): A database that checks the validity of any house, apartment, post office box, rural box, mail drop or commercial address that receives mail. It allows enhanced address validation beyond what’s possible when only the ZIP + 4 database is used.

LACSLink: Checks mailing lists against areas that have had permanent address conversions.

Gene Del Polito is president of the Association for Postal Commerce, an industry group that represents the interests of companies that rely on the mail for business. Reach him at (703) 524-0096 or genedp@postcom.org.