Domestic Mail Manual Changes To Implement the Rate, Fee, and Classification Changes in Docket No. R97-1

SUMMARY: This final rule sets forth the Domestic Mail Manual (DMM)

standards adopted by the Postal Service to implement the rate, fee, and

classification changes for all classes of mail included in the Decision

of the Governors of the Postal Service in Postal Rate Commission Docket

No. R97-1.

EFFECTIVE DATE: This final rule is effective at 12:01 a.m. on January

10, 1999.

FOR FURTHER INFORMATION CONTACT: Lynn M. Martin, 202-268-6351 (all

topics); Paul Lettman, 202-268-6261 (Parcel Post); Thomas DeVaughan,

202-268-4491 (Business Reply Mail).

SUPPLEMENTARY INFORMATION: On July 10, 1997, the Postal Service, acting

under sections 3622 and 3623 of the Postal Reorganization Act (39

U.S.C. 3622, 3623), filed a request for a recommended decision by the

Postal Rate Commission (PRC) on proposed rate, fee, and classification

changes. The PRC designated this filing as Docket No. R97-1. A notice

of filing, with a description of the Postal Service's proposals, was

published by the PRC on July 23, 1997, in the Federal Register (62 FR

39660).

On March 16, 1998, the Postal Service published for public comment

in the Federal Register a proposed rule (63 FR 12864) that provided

information on the implementation rules for the rate, fee, and

classification changes that the Postal Service proposed to adopt if its

requested changes in Docket No. R97-1 were recommended by the PRC and

approved by the Governors of the Postal Service.

Pursuant to 39 U.S.C. 3624, on May 11, 1998, the PRC issued its

Recommended Decision on the Postal Service's Request to the Governors

of the Postal Service. The PRC recommendations made revisions to some

of the mail classification structure, rates, and fees requested by the

Postal Service. Based on an extensive analysis of the PRC's Recommended

Decision and deliberation as to its consequences to the Postal Service

and its customers, and pursuant to 39 U.S.C. 3625, the Governors acted

on the PRC's recommendations on June 29, 1998. The Governors determined

to approve the PRC's Recommended Decision except for the recommended

classifications and fees for Prepaid Reply Mail and the recommended

``shell classification'' for Courtesy Envelope Mail. The Governors

expressed concern about the necessity for these separate

classifications. The Governors have encouraged management to consider

whether refinements to the approved Qualified Business Reply Mail

(QBRM) classifications and fees can be developed which improve upon the

accounting options and fees approved for QBRM. The Postal Service plans

to further study the issue of consumer automation discounts.

The Governors allowed under protest, and returned to the Postal

Rate Commission for reconsideration, the rate schedules for Within

County Periodicals, Library Rate Mail, and DDU Parcel Post.

The Board of Governors set an implementation date of January 10,

1999, for the approved rate, fee, and classification changes to take

effect, except for delivery confirmation and the electronic form of

return receipt (signature confirmation) service for delivery

confirmation customers. The Board of Governors determined that

implementation of the new delivery confirmation service approved in the

Governors' Decision, as well as the classification change allowing

delivery confirmation as a sole prerequisite for return receipt

service, should take place after the effective date established for the

other changes approved and allowed by the Governors, but not later than

June 1, 1999. Later implementation will provide time for deployment of

the technology used to provide these service features. The Board of

Governors determined that an effective date for delivery confirmation

and the electronic form of return receipt (signature service) will be

selected through future action by the Board.

A notice announcing the Governors' decision and the issuance of

final Domestic Mail Classification Schedule and Rate Schedule changes

is contained in a separate notice to be published in the Federal

Register.

This final rule contains the DMM standards adopted by the Postal

Service to implement the Governors' decision. The revised DMM standards

will take effect on January 10, 1999. The standards for delivery

confirmation and the electronic form of return receipt (signature

confirmation) service are not included in this final rule. They will be

contained in a separate Federal Register notice when an implementation

date is set by the Board of Governors.

Part A of this notice summarizes major changes that have been made

to or added to the proposed implementation standards since the proposed

rule. This includes changes made because of differences in the Postal

Service's proposal and the PRC's recommended decision, changes made in

response to the Governors' decisions, and changes made by the Postal

Service in response to mailer comments or for other reasons. Part B

provides a summary of all of the changes in Domestic Mail Manual

standards made as a result of Docket No. R97-1 and this rulemaking

process. Part C contains an analysis of comments received on the

proposed rule and the Postal Service responses. Part D summarizes the

changes to the DMM by DMM module, followed by the text of the revised

DMM standards.

A. Major Changes and Additions Other Than Rate and Fee Levels Since

the March 16, 1998, Proposed Rule

1. Express Mail

a. Hazardous Materials Surcharges

The Postal Rate Commission did not recommend the proposed

surcharges for hazardous medical materials and for other hazardous

materials. Therefore, provisions for hazardous materials surcharges

have not been included in the DMM.

2. Priority Mail

a. Hazardous Materials Surcharges

The Postal Rate Commission did not recommend the proposed

surcharges for hazardous medical materials and for other hazardous

materials. Therefore, provisions for hazardous materials surcharges

have not been included in the DMM.

b. Weight

The weight at which heavy First-Class Mail pieces must be paid at

the Priority Mail rates is increased from First-Class Mail weighing

over 11 ounces to First-Class Mail weighing over 13 ounces. At the

mailer's option, any other mail matter (including regular First-Class

Mail weighing 13 ounces or less) may be mailed as Priority Mail.

3. First-Class Mail

a. Hazardous Materials Surcharges

The Postal Rate Commission did not recommend the proposed

surcharges for hazardous medical materials and for other hazardous

materials. Therefore, provisions for hazardous materials surcharges

have not been included in the DMM.

[[Page 37947]]

b. Heavy Piece Discount

The additional heavy piece presort discount of $0.046 for the first

ounce of mailpieces weighing more than 2 ounces remains in effect.

c. Maximum Weight

The maximum weight of First-Class Mail is increased from 11 ounces

to 13 ounces.

d. Prepaid Reply Mail

Prepaid Reply Mail will not be implemented.

4. Periodicals

a. Eligibility for In-County High Density Rates

Eligibility for the high density rate for In-County pieces will be

revised to allow walk-sequenced pieces for a carrier route to qualify

when there are either a minimum of 125 pieces for a carrier route or

addressed pieces for at least 25 percent of the total active possible

deliveries on a carrier route.

5. Standard Mail (A)

a. Hazardous Materials Surcharges

The Postal Rate Commission did not recommend the proposed

surcharges for hazardous medical materials and for other hazardous

materials. Therefore, provisions for hazardous materials surcharges

have not been included in the DMM.

b. ``Presorted Standard'' Marking

A two-year transition period (instead of one year) will be

permitted for mailers to change their ``Bulk Rate'' markings to

``Presorted Standard.'' Until January 10, 2001, mailers of regular rate

Standard Mail (A) material (matter at regular Presorted Standard Mail

(A), regular automation, and regular Enhanced Carrier Route rates) may

use either the ``Bulk Rate'' or the ``Presorted Standard'' markings or

their respective authorized abbreviations on their mailings. At the

mailer's option the ``Presorted Standard'' marking or its abbreviation

may be used instead of ``Bulk Rate'' or its abbreviation effective

immediately.

c. ``RSS'' Marking

The Postal Service will not require a separate ``RSS'' marking for

pieces that are subject to the residual shape surcharge.

d. Pieces Not Qualifying for Standard Mail

(A). Mailers have indicated that they may have pieces prepared with

Standard Mail (A) rate markings that cannot be mailed at a Standard

Mail (A) rate under the provisions for ``residual'' pieces set forth in

the proposed rule and this final rule. Reasons include the mailer

having pieces remaining in a mailing job that cannot be matched to a

correct 5-digit ZIP Code, or the mailer choosing not to hand-sort

handwritten pieces that could not be barcoded and sorted by a multi-

line optical character reader (MLOCR). In such instances, mailers must

pay single-piece First-Class Mail or Priority Mail postage on the

pieces.

If mailers desire to receive First-Class or Priority Mail service

as applicable based on the weight of the mailpieces (including

forwarding and return services), they must re-envelope or otherwise

prepare the mailpieces so that they bear only the proper First-Class

Mail or Priority Mail rate markings, ancillary service endorsements,

Address Change Service (ACS) codes, etc. Metered pieces weighing over

13 ounces and less than 16 ounces must always be prepared under this

method.

Except for metered pieces weighing over 13 ounces and less than 16

ounces, mailers who do not desire to receive First-Class or Priority

Mail service on such pieces may submit them ``as is'' (i.e., bearing

the Standard Mail (A) markings and endorsements). No additional

markings or postage are to be added to these pieces. First-Class Mail

or Priority Mail postage must be paid for these pieces using the

appropriate First-Class or Priority Mail postage statement. Except for

metered pieces weighing over 13 ounces and less than 16 ounces, mail

bearing metered or precanceled stamp postage must, under this option,

pay the difference between the postage affixed and the First-Class Mail

or Priority Mail rates by means of an advance deposit account or by

affixing a meter strip for the appropriate amount to the postage

statement. If the pieces weigh 13 ounces or less, mailers must use

special line items on the new First-Class postage statements under the

heading ``From Standard Mail (A)'' to record the pieces mailed. This

option may be used for fewer than 200 pieces of permit imprint mail

only if the pieces were part of a larger mailing job and are submitted

for acceptance along with the mail and a Standard Mail (A) postage

statement for the other pieces in the same mailing job. Metered pieces

weighing over 13 ounces and less than 16 ounces cannot use this option

since there is no postage statement on which they can be reported and

therefore must be re-enveloped and prepared as Priority Mail.

6. Standard Mail (B)

a. Barcoded Discounts

(1) Additional Barcode Option. A fourth barcode symbology, UCC/EAN

Code 128, has been added. The USPS, in cooperation with the parcel

shipping industry, has adopted the UCC/EAN Code 128 as its preferred

code structure and symbology standard. The UCC/EAN Code 128 permits

encoding of either the 5-digit ZIP Code or the ZIP+4 code. The ZIP Code

information must be preceded by the Application Identifier ``420'' that

signifies a domestic ZIP Code, and must not include the trailing

verifier character ``9'' used with other barcode symbologies. The UCC/

EAN code 128 will become mandatory for the barcoded discount in five

years (January 10, 2004). During the 5-year phase-in period, UCC/EAN

Code 128, as well as USS Code 128; USS Code I 2/5; and USS Code 39

symbologies will be permitted.

(2) Numeric Equivalent of Barcode. The requirement to print human-

readable characters representing the numeric equivalent of the ZIP Code

information in the barcode (i.e., omitting the verifier character or,

for UCC/EAN Code 128, omitting the 3-digit application identifier

characters) near the barcode will not be required if the barcode is on

the same label as the address block and is placed in close proximity to

the address. The human-readable numeric equivalent of the ZIP Code

information in the barcode will be required for barcodes not printed on

the same label as the address block on mailpieces.

(3) Parcel Post ASF Barcoded Rate Exclusion. The exclusion from the

barcoded discount of machinable pieces eligible for DBMC rates that are

entered at an auxiliary service facility (ASF) has been revised. Since

the Phoenix, Arizona, ASF has parcel barcode reading equipment,

machinable pieces of Parcel Post DBMC rate mail entered at the Phoenix

ASF will be eligible for barcoded discounts. Since no other ASFs have

barcode reading equipment, DBMC rate mail entered at ASFs other than

Phoenix will not be eligible for the barcoded discount.

b. Hazardous Materials Surcharges

The Postal Rate Commission did not recommend the proposed

surcharges for hazardous medical materials and for other hazardous

materials. Therefore, provisions for hazardous materials surcharges

have not been included in the DMM.

[[Page 37948]]

c. Parcel Post BMC Presort and OBMC Presort Discounts

(1) Mail Preparation. The proposed requirement to prepare

machinable parcels in pallet boxes measuring 72 inches high and to fill

the boxes with at least 54 inches of mail to qualify for these

discounts is revised. The new requirement is to prepare machinable

parcels in pallet boxes measuring 69 inches high and to fill the boxes

with at least 52 inches of mail to qualify for these discounts. The

preparation requirements for nonmachinable mail did not change.

(2) Documentation. The requirement for documentation listing number

of pieces per individual pallet is eliminated.

d. Parcel Post Oversized Pieces.

The 10% limit per mailing of pieces that measure over 108 inches

but not more than 130 inches in combined length and girth is removed.

In its place the PRC recommended and the Governors of the Postal

Service approved oversized rates for such pieces. These oversized rates

are greater than the rates for 70-pound parcels.

e. Parcel Post DSCF Rate

(1) Sacking Requirements Revised. The minimum number of pieces per

5-digit sack is revised from 10 pieces to 7 pieces. A provision also is

added to allow one overflow sack per 5-digit destination. The overflow

sack has no minimum quantity requirement.

(2) New Pallet Preparation Option Added. In response to mailer

comments that the pallet minimums were too high, a new pallet

preparation option has been added. This option allows preparation of 5-

digit pallets with a minimum of 35 pieces and 200 pounds of mail,

provided the average number of pieces placed on pallets qualifying for

the DSCF rate in such a mailing is at least 50 pieces. In order to

document that no pallet contains less than 35 pieces and 200 pounds and

that the average number of pieces per pallet claiming the DSCF rate is

at least 50 pieces, mailers will be required to submit detailed

documentation and place sequential identification numbers on qualifying

pallets of DSCF rate mail. The documentation must list each pallet in

sequential order by pallet identification number. The listing must show

for each pallet: the pallet identification number, the 5-digit ZIP Code

of the pallet, the total weight of pieces on the pallet, the total

number of pieces on the pallet, and the cumulative total of pieces

(i.e., the number equal to the number of pieces for that pallet plus

the sum of the pieces on all pallets listed above it).

(3) Overflow Provisions for Palletized Mail Added. Provisions are

added to allow overflow from 5-digit pallets to be placed in

corresponding 5-digit sacks. The overflow 5-digit sacks have no minimum

quantity requirement, and the pieces placed in them will qualify for

the DSCF rate. Mailers will also have the option of preparing a 5-digit

overflow pallet. However, the pieces on overflow pallets, which by

definition contain less than the minimum quantity required for a

qualifying DSCF rate pallet, are not eligible for DSCF rates and are

subject to the DBMC rates.

(4) Pallet Boxes. The prohibition against use of pallet boxes on

pallets for the DSCF rate is eliminated. Pallet boxes on pallets will

be permitted for any 5-digit facility that can handle pallets, provided

the pallet boxes measure no more than 60 inches high and meet the

pallet box provisions in DMM M041. Mail prepared in pallet boxes is

subject to the same pallet minimum preparation options as parcels

placed directly on pallets.

(5) Sacks on Pallets. Under DMM M045.12, mailers may consolidate 5-

digit sacks prepared under DMM M630 and/or under DMM M045.11 that

qualify for the DSCF rate on an SCF pallet. Both 5-digit sacks meeting

or exceeding the 7-piece minimum and overflow sacks (overflow from

sacks and overflow from pallets) may be palletized in this manner.

However, if in the same mailing, mail is palletized under M045.11.1 and

sacked under M630, the sacks that are prepared as overflow from pallets

must, at the time of acceptance, be separated from sacks prepared under

M630. SCF pallets containing 5-digit sacks qualifying for the DSCF rate

may be prepared without having to first prepare all possible 5-digit

pallets and without having to meet a 250-pound pallet minimum. A

special pallet label is specified for these pallets in M045.

(6) Additional Information Pertaining to Drop Shipment Product.

Mailers must use the following additional information when using the

Drop Shipment Product to determine whether mail for a 5-digit ZIP Code

delivery unit may be prepared on pallets to qualify for the DSCF rate.

The DMM standards are revised to specify that when the Drop Shipment

Product shows that mail for a single 5-digit ZIP Code area is delivered

from more than one facility, the facility listed in the Drop Shipment

Product that delivers mail to the majority of city carrier routes will

be considered the delivery unit for parcel post. Two exhibits, Exhibits

E652.6.0 and 652.7.0 that contain exceptions to the ``majority of city

carriers'' rule, are also added to the DMM. If a 5-digit ZIP Code is

listed in DMM Exhibit E652.6.0 or E652.7.0, the facility listed in one

of those exhibits must be used to determine the name of the delivery

unit. The name of the delivery unit must then be looked up in the Drop

Shipment Product to determine if mail for it, and therefore mail for

the 5-digit ZIP Code, can be prepared on pallets to qualify for the

DSCF rate. At some point in the future the information in these two

exhibits will be incorporated in the Drop Shipment Product.

(7) Nonmachinable Outsides. Nonmachinable outside (NMO) parcels by

definition cannot be prepared in sacks because they will not fit in a

sack. Therefore, NMOs must be prepared directly on pallets or in pallet

boxes on pallets. If overflow pallets are prepared, the pieces on such

pallets are subject to the DBMC rates. The DSCF rate is not available

for NMOs at those 5-digit delivery units that cannot handle palletized

mail as listed in the Drop Shipment Product and in Exhibits E652.6.0

and E652.7.0.

(8) Exceptions to DMM Exhibit E652.5.0. Provisions are added to

allow mailers to submit a written request to the Area Manager,

Operations Support, for permission to bring palletized mail for a 5-

digit ZIP Code area listed in DMM Exhibit E652.5 to the DSCF rather

than to the applicable BMC. Such exceptions must be requested at least

15 days in advance and may be granted for a limited period of time

only.

(9) Separation of Perishable and Nonperishable Parcels. The

requirement to separate perishable and nonperishable parcels is deleted

from the final DMM rules.

f. Parcel Post DDU Rate

(1) Pallet Boxes. The prohibition against the use of pallet boxes

on pallets is eliminated. Pallet boxes on pallets will be permitted for

any 5-digit facility that can handle pallets, provided that the pallet

boxes measure no more than 60 inches high and meet the pallet box

provisions in DMM M041.

(2) Additional Lists Pertaining to Drop Shipment Product. Mailers

must use the following additional information when using the Drop

Shipment Product to determine the location of the delivery unit for a

5-digit ZIP Code area. When mail for a single 5-digit ZIP Code area is

delivered from more than one facility, the facility listed in the Drop

Shipment Product that delivers mail to the majority of city carrier

routes is the delivery unit at which mail must be entered to claim the

DDU rate. There are two exceptions to this general rule. Two

[[Page 37949]]

exhibits, Exhibit E652.6.0 and Exhibit E652.7.0 are added to DMM E652.

Exhibit E652.6.0 contains exceptions to the ``majority of city carrier

routes'' rule. Exhibit E652.7.0 contains other anomalous situations

including those where a parcel annex is used to deliver mail for

multiple 5-digit ZIP Codes. If a 5-digit ZIP Code is listed in DMM

Exhibit E652.6.0 or Exhibit E652.7.0, the facility location in one of

those lists is the delivery unit to which the mail must be brought to

qualify for the DDU rate. This facility must be looked up in the Drop

Shipment Product to determine if that facility can handle pallets and

(for facilities listed in Exhibit E652.6.0) to determine the address of

the facility.

(3) Pallet Stacking. Mailers may stack pallets of mail entered at

destination delivery units provided that the mailer unloads and

unstacks the pallets at the delivery unit and removes any strapping

material.

(4) Appointments. To facilitate the scheduling of drop shipments to

delivery units, the Postal Service will allow standing appointments if

shipment frequency is weekly or more often. A provision also has been

added in E652.3.4 to specify that appointments are required for mixed

loads of Periodicals and Standard Mail (B) entered at destination entry

rates. DMM E250.2.4 already contains a similar provision for DDU entry

of mixed loads of Periodicals and Standard Mail.

(5) Grace Period for Late Arrivals. The grace period allowed for

late arrival of shipments at DDUs, previously stated to be 1 hour, is

revised to 20 minutes.

g. Markings

(1) Parcel Post. Except for mail qualifying for a drop shipment

rate, mailers will be given a one-year grace period, until January 10,

2000, to print the ``Parcel Post'' or ``PP'' markings in the postage

area. As of January 10, 1999, Drop Shipment rate mail must show the

``Parcel Post'' or ``PP'' marking in the postage area and the marking

``Drop Ship'' or ``D/S'' in either the postage area or on the line

above or two lines above the address. An exception is that DBMC rate

mailers currently using the ``DBMC Parcel Post'' or ``DBMC PP'' marking

may continue to do so until January 10, 2000.

(2) Standard Mail (B) Other than Parcel Post. Mailers not already

doing so will have until January 10, 2000, to place the current

required subclass markings ``Bound Printed Matter,'' ``Special

Standard,'' and ``Library Mail'' or ``Library Rate'' in the postage

area (as opposed to elsewhere on the mailpiece).

(3) Bound Printed Matter. At the mailer's option the ``Presorted''

marking may be used instead of ``Bulk Rate'' effective immediately.

(This marking will be required effective January 10, 2000.) In

addition, mailers may use the marking ``Presorted Standard'' (or

``PRSRT STD'') instead of ``Presorted'' (or ``PRSRT'') wherever the

``Presorted'' marking is required or permitted.

7. Special Services

a. Bulk Insurance

A provision requiring an electronic manifest to qualify for the

bulk insurance discount was recommended by the PRC and approved by the

Governors of the Postal Service. Therefore, one of the requirements to

obtain this discount will be to provide a hard copy of Form 3877, Firm

Mailing Book for Accountable Mail (or facsimile), and a copy of Form

3877 on a diskette or other electronic medium. When systems that

electronically capture information on accountable mail are completed

and programming changes that will tie the St. Louis ASC into these

systems are completed, mailers will be required to file claims

electronically. When or before these changes and systems are completed,

bulk insurance mailers will be provided with instructions for a new

format for the electronic Form 3877 and with instructions for

electronically filing claims.

b. Business Reply Mail

Mailers will have until January 10, 2001, to comply with the

standard that Qualified Business Reply Mail pieces and other BRM pieces

bearing a barcode that measure more than 4\1/4\ inches by 6 inches must

meet a minimum thickness requirement of .009 inch. In addition, mailers

of QBRM and other BRM pieces that bear a barcode will be given until

January 10, 2001, to meet the amended requirements for the barcode

clear zone, window placement for lower right barcodes, and placement of

the leftmost bar of lower right barcodes. The barcode specifications

that are in DMM C840 will be required, rather than optional. The basis

weight requirement for envelopes in C810.7.1 will not apply to BRM. BRM

envelopes must continue to meet a minimum paper basis weight of 20

pounds (measured using 500 sheets of 17- by 22-inch paper). The

standard in current S922.6.4 that envelope material must not have a

phosphorescence exceeding 4.0 phosphor meter units is retained and

corrected to state that envelope material must not have a red

fluorescence exceeding 4.0 phosphor meter units.

c. Delivery Confirmation

Standards concerning delivery confirmation were removed pending an

implementation date.

d. Merchandise Return Service

The Postal Service revised the requirements for preprinted rate

markings. The Priority Mail marking will not be required to be

preprinted on all matter that might be subject to that rate upon

return. It is understood that permit holders may not be able to predict

whether a piece that might be returned will weigh over 13 ounces but

less than 16 ounces and therefore need a Priority Mail marking on the

merchandise return label. Therefore, the permit holder must preprint a

Priority Mail marking only when it is desired that the mail matter be

returned at those rates regardless of its weight. Pieces prepared with

merchandise return labels that do not contain a preprinted rate marking

will be returned at the First-Class Mail rates if weighing 13 ounces or

less, at the Priority Mail rates if weighing over 13 ounces but less

than 16 ounces, and at the Parcel Post rates if weighing 16 ounces or

more.

d. Return Receipt

The Postal Service determined not to revise DMM D042.1.7.

B. Summary of all DMM Revisions for R97-1

1. Express Mail

a. Rate Highlights

Overall, Express Mail rates will increase 9%. For Post Office to

Addressee service, the letter rate will increase to $11.75 and the 2-

pound flat rate will increase to $15.75. The fee for pickup service

will increase from $4.95 to $8.25 per occurrence.

b. Rate Structure

There are no changes to the rate structure.

2. Priority Mail

a. Rate Highlights

On average, Priority Mail rates will increase 5.6%. The fee for

pickup service will increase from $4.95 to $8.25 per occurrence.

b. Classification and Rate Structure

(1) Keys and Identification Devices. Keys and identification

devices that weigh more than 13 ounces but not more than 2 pounds will

be subject to the 2-pound Priority Mail rate plus a $0.30 fee.

(2) Elimination of Presort Category. The Presorted Priority Mail

rate category

[[Page 37950]]

will be eliminated. Therefore, DMM labeling list L102, ADCs--Presorted

Priority Mail, also will be eliminated.

(3) Delivery Confirmation. A new delivery confirmation service will

be available with Priority Mail in early 1999. See further details

under ``Special Services.''

3. First-Class Mail

a. Rate Highlights

The single-piece first-ounce letter rate will be increased one cent

from $0.32 to $0.33, and the rate for each additional ounce will

decrease to $0.22. The nonstandard surcharges for non-card-rate pieces

will not increase and will remain at $0.11 for single-piece rate mail

and $0.05 for presorted mail. For card rates, no change will be made to

the single-piece rates, nonautomation Presorted rates, automation 3-

digit rates and automation basic rates. No change will be made to \3/

5\-digit automation flat rates. Small increases will be made to other

automation rates and Presorted rates. The annual presort mailing fee

will be increased from $85.00 to $100.00.

b. Classification and Rate Structure

(1) Increase in Maximum Weight. The maximum weight of First-Class

Mail will be increased from 11 ounces to 13 ounces.

(2) Keys and Identification Devices. Keys and identification

devices that weigh 13 ounces or less will be subject to the applicable

single-piece letter rate, plus a $0.30 fee and, if applicable, the

nonstandard surcharge.

(3) Qualified Business Reply Mail. A new classification category

and rate structure for qualified business reply mail (QBRM) that must

be letter-size (including cards), automation-compatible, and barcoded

will be added. As a result, the BRMAS fee category will be eliminated.

The rate structure for QBRM includes a lower first-ounce rate. The fee

structure for QBRM requires an annual permit fee, an annual accounting

fee, and a fee for each piece returned. More specific requirements for

this new classification category are described under DMM E150 and under

``Special Services'' below.

c. Rate Markings

The abbreviation ``PRSRT'' will be permitted for the required

``Presorted'' marking.

4. Periodicals

a. Rate Highlights

There will be average rate increases of 4.6% for Regular, 1.1% for

In-County, 8.0% for Nonprofit, and 12.1% for Classroom publications.

Authorization fees will not change, except that the additional entry

fee decreases from $85.00 to $50.00.

b. Classification and Rate Structure

(1) Per-Piece Rates. Separate 5-digit presort per-piece rates and

3-digit presort per-piece rates will be added for Regular, Nonprofit,

Classroom, and In-County subclasses. Furthermore, the 3-digit presort

level rates will apply to both unique and nonunique 3-digit ZIP Code

prefixes.

To qualify for the nonautomation 5-digit per-piece rates, mail must

be prepared in a 5-digit package of six or more pieces and must be

containerized as follows: for letter mail, be placed in a 5-digit tray;

for nonautomation flat mail, be placed in a 5-digit sack or on any

presort level of pallet. To qualify for automation 5-digit per-piece

rates for letters, mail must be part of a group of 150 pieces for the

same 5-digit or 5-digit scheme, properly placed in a 5-digit or 5-digit

scheme tray. To qualify for automation 5-digit per-piece rates for

flats, mail must be prepared in a 5-digit package of six or more pieces

and placed in any level of sack or on any level of pallet.

To qualify for the nonautomation 3-digit per-piece rates, sacked

flat-sized mail must be prepared in a 5-digit package of six or more

pieces or in a 3-digit package of six or more pieces, and must be

placed in a 3-digit sack; trayed letter-size mail must be prepared in a

5-digit package of six or more pieces or in a 3-digit package of six or

more pieces, and must be placed in a 3-digit tray. Palletized flat-

sized mail must be prepared in a 3-digit package of six or more pieces

and placed on a 3-digit or higher (e.g., SCF, ADC) level of pallet.

To qualify for automation 3-digit per-piece rates for letters, mail

must be part of a group of 150 pieces for the same 3-digit or 3-digit

scheme and be properly placed in a 3-digit or 3-digit scheme tray. To

qualify for automation 3-digit per-piece rates for flats, mail must be

prepared in a 3-digit package of six or more pieces and placed in a 3-

digit or higher (e.g. ADC or mixed ADC) level of sack or on a 3-digit

or higher (e.g., SCF, ADC) level of pallet.

(2) Eligibility for In-County High Density Rates. Eligibility for

the high density rate for In-County pieces will be revised to allow

walk-sequenced pieces for a carrier route to qualify when there are

either a minimum of 125 pieces for the carrier route, or addressed

pieces for at least 25 percent of the total active possible deliveries

on the carrier route.

c. Mail Preparation

(1) Automation Letters. Preparation of the 5-digit or 5-digit

scheme sort for letter-size automation rate mailings will be revised

from a required level of sort to an optional level of sort.

(2) SCF Sack. The current optional SCF sack for nonletter mail will

be revised to a required level of preparation. Preparation of an

optional origin/required entry SCF sack will be added. Preparation of

an optional origin/required entry 3-digit sack will be eliminated. SCF

packages are not and will not be permitted.

d. Forwarding and Return

Charges for the return of Periodicals mail bearing the ``Address

Service Requested'' endorsement will be paid at the First-Class Mail

rates for pieces weighing 13 ounces or less and at the Priority Mail

rates for pieces weighing more than 13 ounces. (Priority Mail rates

also apply to pieces weighing 16 ounces or more.) This is due to the

elimination of the Standard Mail (A) single-piece rates discussed

below.

5. Standard Mail (A)

a. Rate Highlights

There will be average rate increases of 2.6% for Regular, 2.3% for

Enhanced Carrier Route, and 14.0% for Nonprofit subclasses. On average,

there will be a 8.0% decrease in Nonprofit Enhanced Carrier Route

rates. Nonprofit and Nonprofit ECR pound rates will decrease. Regular

and ECR pound rates will remain the same. For the first time, the

automation 5-digit letter rate will be lower than the basic Enhanced

Carrier Route rate. The basic Enhanced Carrier Route minimum per-piece

rates will be the same for letter-size and for nonletter-size pieces.

The destination entry discounts will maintain their current discount

differentials between BMC and SCF and between SCF and DDU. The annual

presort mailing fee will increase from $85.00 to $100.00.

b. Rate Structure

(1) Elimination of Single-Piece Rates. The single-piece Standard

Mail (A) rates will be eliminated. This will affect the treatment of

pieces in situations where there are fewer than 200 pieces remaining in

a mailing job after preparation of an Enhanced Carrier Route and/or an

automation rate mailing, situations in which there are fewer than 200

pieces in a mailing job, or situations in which the pieces are not or

may not be presorted. See ``Mail Preparation'' below for further

information. It also affects the fees for forwarding and return of

Standard Mail

[[Page 37951]]

(A) as described below under ``Forwarding and Return.'' With one

exception, single pieces that weigh less than 16 ounces will be subject

to return postage at single-piece First-Class or Priority Mail rates

multiplied by 2.472. The exception is that single pieces weighing less

than 16 ounces that could qualify for single-piece Special Standard

Mail or Library Mail rates will continue to be eligible for those rates

upon return if properly endorsed because there are no minimum weight

requirements for those two subclasses of Standard Mail (B).

(2) Residual Shape Surcharge. Pieces that are prepared as parcels

or that are not letter-size or flat-size will be subject to a $0.10 per

piece residual shape surcharge in addition to the applicable nonletter

postage. This surcharge applies to such pieces mailed at all Standard

Mail (A) subclasses (Regular, Enhanced Carrier Route, Nonprofit,

Nonprofit Enhanced Carrier Route).

c. Mail Preparation

(1) Bulk Rate Markings and Nomenclature. Effective January 10,

2001, the basic rate marking requirements for regular rate mailings

(including Enhanced Carrier Route) will be changed from ``Bulk Rate''

or ``Blk. Rt.'' to ``Presorted Standard'' or ``PRSRT STD.'' During the

two-year transition period, either the ``Bulk Rate'' or the ``Presorted

Standard'' markings or their authorized abbreviations will be

acceptable. For consistency, the DMM will use the term ``Presorted

Standard Mail (A)'' or ``Presorted Standard'' when referring to the

mailings and rates currently referred to as ``nonautomation presort (3/

5 and basic) Standard Mail (A).'' At the mailer's option the

``Presorted Standard'' or ``PRSRT STD'' marking may be used instead of

``Bulk Rate'' effective immediately.

(2) Markings for Standard Mail (A) Matter Paid at Standard Mail (B)

Rates. Effective January 10, 1999, mailings paid at Standard Mail (B)

rates under the exception in DMM E612.4.6 must bear the appropriate

Standard Mail (B) rate marking, not the applicable Standard Mail (A)

rate marking. DMM E612.4.6 contains provisions that allow Standard Mail

(A) matter weighing less than 16 ounces to pay Standard Mail (B) rates

if those rates are lower than Standard Mail (A) rates and the matter

and the mailing could qualify for the Standard Mail (B) rate except for

weight. For example, if a mailer had flat-size printed matter pieces

that met the qualifications for Bound Printed Matter in DMM E630 (until

January 10, DMM E620) except that the pieces each weighed less than one

pound, and if the applicable Bound Printed Matter Rates were less than

the applicable Standard Mail (A) rates, the mailer could presort them

as Standard Mail (A) flats and claim basic presorted Bound Printed

Matter rates. Under this example, if the pieces weighed four ounces and

the mailing was only for the local zone, the Bound Printed Matter rates

would be lower than the Presorted Standard Mail (A) rates. Therefore,

the mailer could claim local zone Bound Printed Matter rates if: (1)

the pieces are presorted according the Presorted Standard Mail (A)

requirements to 5-digit, 3-digit, ADC, and Mixed ADC (that are similar

to the presort requirements for presorted Bound Printed Matter), (2)

the pieces are marked ``Presorted'' or ``Presorted Standard'' and

``Bound Printed Matter,'' and (3) documentation is submitted to

substantiate that the pieces qualified for the local zone rate.

(3) Elimination of Single-Piece Rates. Currently, Standard Mail (A)

single-piece rates apply to pieces that cannot meet the separate

minimum volume requirement of 200 pieces for a Presorted Standard

mailing either because the mailing job itself contains fewer than 200

pieces or because after preparing an Enhanced Carrier Route and/or

automation mailing the pieces remaining in the mailing job are fewer

than 200. Other instances where single-piece rates currently apply

include mailers using MLOCRs to prepare the mail who may have pieces

remaining in a mailing job that could not be matched to a 5-digit ZIP

Code, or mailers who choose not to hand-sort handwritten pieces that

could not be barcoded and sorted by a MLOCR. The single-piece Standard

Mail (A) rate is eliminated. Mailers will now have three options

concerning preparation and payment for mailing pieces that formerly

were paid at the single-piece Standard Mail (A) rates.

Option one applies to pieces that remain in a mailing job after a

mailer has prepared an Enhanced Carrier Route and/or an automation

mailing. A new provision in DMM E630.1.1 and 1.2 will allow pieces in

an Enhanced Carrier Route rate mailing and/or in an automation rate

mailing that have each separately met a 200-piece or 50-pound minimum

quantity requirement to be counted toward the minimum quantity

requirement for a Presorted Standard (\3/5\ and basic rate) mailing,

provided that (1) the Enhanced Carrier Route rate mailing and/or the

automation mailing, and the Presorted Standard mailing are part of the

same mailing job, and (2) the mailings are all reported on the same

postage statement. Under no circumstances may pieces mailed at the

Presorted Standard (nonautomation \3/5\ and basic) rates be counted

toward the minimum volume requirements for an Enhanced Carrier Route or

an automation rate mailing. The pieces mailed at the Presorted Standard

rates under this provision must meet all other requirements for those

rates, including the sortation and other preparation requirements in

M610. As prescribed in DMM M610.1.1e, the pieces mailed at the

Presorted Standard rates must not bear any Enhanced Carrier Route or

automation markings. Only ``Presorted Standard'' (or, until January 10,

2001, ``Bulk Rate''), ``Nonprofit Organization,'' or their applicable

authorized abbreviations may appear on pieces mailed at the Presorted

Standard rates.

Options two and three apply to mailings that cannot qualify for the

Presorted Standard Mail rates under the above provisions for residual

minimum volume. These might be mailings containing fewer than 200

pieces that cannot be reported on the same postage statement as other

mailings in the mailing job because the pieces have a different per

piece weight (because of different editions in the same job). They

could also be pieces remaining after sorting a mailing job that could

not be matched to a correct 5-digit ZIP Code, or pieces that could not

be barcoded and sorted by a MLOCR because they bear handwritten

addresses and the mailer chose not to hand-sort the pieces. In such

instances, mailers must pay single-piece First-Class Mail or Priority

Mail postage on the pieces.

Option two is for mailers of such pieces who desire to receive

First-Class or Priority Mail service (including forwarding and return

services) on such pieces as applicable, based on the weight of the

mailpieces. Under this option, mailers must re-envelope the pieces or

initially prepare them so that they bear only the proper First-Class

Mail or Priority Mail markings, ancillary service endorsements, ACS

codes, etc. These pieces must not bear Standard Mail (A) markings,

endorsements or ACS codes. This option will also be required for

metered mailpieces weighing over 13 ounces, but less than 16 ounces,

that cannot be mailed under option one.

Option three is for mailers who have pieces (other than metered

pieces weighing over 13 ounces, but less than 16 ounces) that cannot

qualify for the Presorted Standard Mail (A) rates, but that are

prepared as Standard Mail (A), and who do not desire to receive First-

Class Mail or Priority Mail service for those pieces. Under this option

the pieces may be submitted ``as is'' (i.e., bearing the Standard Mail

(A) markings

[[Page 37952]]

and endorsements). No additional markings or postage are to be added to

these pieces. Single-piece First-Class Mail or Priority Mail postage

must be paid for these pieces using the appropriate First-Class or

Priority Mail postage statement. Mail bearing metered or precanceled

stamp postage must pay the difference between the postage affixed at

the Standard Mail (A) rates and the single-piece First-Class Mail or

Priority Mail rates by means of an advance deposit account or by

affixing a meter strip for the appropriate amount to the postage

statement. Mail bearing permit imprints must pay the single-piece

First-Class or Priority Mail postage by completing the appropriate

First-Class or Priority Mail postage statement. If the pieces weigh 13

ounces or less, mailers must use special line items under Part C on the

reverse side of Form 3600-R, Postage Statement--First-Class Mail Permit

Imprint, or Form 3600-P, Postage Statement--First-Class Mail Postage

Affixed. The new line items on the postage statements appear under the

heading ``From Standard Mail (A).'' If the pieces weigh over 13 ounces

but less than 16 ounces, and are paid with permit imprint, Form 3600-

PM, Postage Statement--Priority Mail Permit Imprint, must be

appropriately completed to show that the pieces are from a Standard

Mail (A) mailing. Option 3 may be used for permit imprint mail only if

there are at least 200 pieces to be mailed under this option, or if the

pieces were part of a larger mailing job and are submitted for

acceptance along with the mail and a Standard Mail (A) postage

statement for the other pieces in the same mailing job.

d. Forwarding and Return. With two exceptions, charges for the

forwarding and return of Standard Mail (A) are paid at the First-Class

Mail rates for pieces weighing 13 ounces or less and at the Priority

Mail rates for pieces weighing over 13 ounces. This is because single-

piece Standard Mail (A) rates have been eliminated as discussed above.

The exceptions are (1) matter returned under Bulk Parcel Return Service

(BPRS) and (2) matter that qualifies for a single-piece Special

Standard Mail or Library Mail rate under DMM E630 and is endorsed to

show that forwarding and return is requested at one of those rates.

6. Standard Mail (B)

a. Rate Highlights

Some Parcel Post rates will decrease and many will increase, some

as much as 30%. New rate categories and discounts will be added to

Parcel Post as described in 6b below. On average, Bound Printed Matter

rates will increase 5%. The discount will increase for sorting Bound

Printed Matter to carrier route. Special Standard Mail rates will

decrease. Library Mail rates will be the same as Special Standard Mail

rates, resulting in a rate increase. The annual fees for destination

bulk mail center (DBMC) rates and presorted Special Standard Mail will

increase from $85.00 to $100.00. The fee for pickup service for Parcel

Post will increase from $4.95 to $8.25 per occurrence. (Pickup service

is not available for mailings claiming Parcel Post destination entry

rates or Origin Bulk Mail Center (OBMC Presort) Presort discounts.)

b. Rate Structure for All Standard Mail (B)

(1) Barcoded Discount. A discount of $0.03 per piece will apply to

machinable pieces in mailings meeting a 50-piece minimum quantity

requirement that bear a correct and properly prepared barcode

representing the 5-digit ZIP Code (or, for UCC/EAN Code 128, the ZIP+4

code) of the address on the mailpiece. Mail for each Standard Mail (B)

subclass (Parcel Post, Bound Printed Matter, Special Standard, and

Library Mail) must separately meet the 50-piece minimum volume

requirement.

The barcode specifications and clear zone requirements are in DMM

C850. UCC/EAN Code 128 as well as USS Code 128; USS Code I 2/5; and USS

Code 39 symbologies will be permitted until January 10, 2004. Beginning

January 10, 2004, only UCC/EAN Code 128 will be permitted. For all

barcode symbologies except UCC/EAN Code 128, the barcode must represent

the correct 5-digit ZIP Code of the address on the mailpiece followed

by the verifier character ``9.'' The UCC/EAN Code 128 barcode must

represent either the correct 5-digit ZIP Code or the ZIP+4 code for the

address on the mailpiece. For the UCC/EAN Code 128 barcode, the ZIP

Code information must be preceded by the Application Identifier ``420''

that signifies a domestic ZIP Code, and must not include the trailing

verifier character ``9'' used with the other barcode symbologies.

Mailers must print human-readable characters representing the numeric

equivalent of the ZIP Code information in the barcode (i.e., omitting

the verifier character or, for UCC/EAN Code 128, omitting the 3-digit

application identifier characters) preceded by the word ``ZIP'' near

the barcode. An exception is that the numeric equivalent of the ZIP

Code information in the barcode will not be required if the barcode is

on the same label as the address block and is placed in close proximity

to the address.

The barcoded discount reflects the savings for parcels that are

routinely processed individually on BMC parcel sorters equipped with

barcode readers. Therefore, the discount will not be available for

nonmachinable parcels and will not be available for parcels that are

intended to bypass individual BMC sortation. The barcoded discount will

therefore not be available for: (1) any nonmachinable parcel, (2)

Parcel Post mail entered at destination sectional center facility

(DSCF) rates, (3) Parcel Post mail entered at destination delivery unit

(DDU) rates; (4) Parcel Post DBMC rate mail entered at any auxiliary

service facility (ASF) other than the ASF at Phoenix, AZ (which has

barcode readers), (5) Bound Printed Matter at the Carrier Route rates,

and (6) Presorted Special Standard Mail at the 5-digit rate.

(2) Delivery Confirmation. A new delivery confirmation service will

be available for Standard Mail (B) in early 1999. See further details

under ``Special Services.''

c. Rate Structure for Parcel Post

(1) Presort Discounts for Inter-BMC Rates. A new Origin Bulk Mail

Center Presort (OBMC Presort) discount of $0.57 per piece will be

available for mail entered at a BMC that meets sortation criteria

specific for the type of parcel. Machinable parcels must be sorted to

BMCs and nonmachinable parcels must be sorted to BMCs and ASFs. A new

BMC Presort discount of $0.22 per piece will be available for pieces

that are sorted in the same manner as those qualifying for the OBMC

Presort discount (sorted to BMCs if machinable parcels or sorted to

BMCs and ASFs if nonmachinable parcels) and entered at any postal

facility other than a BMC that accepts bulk mailings. To qualify for

either of these rates, pieces must be part of a mailing of at least 50

pieces mailed at Parcel Post rates. See ``Mail Preparation'' below for

more details.

(2) Drop Shipment Rates. New destination delivery unit (DDU) rates

will be available for pieces entered at the delivery unit from which

the parcels are delivered. DDU rate pieces must be part of a mailing of

at least 50 pieces mailed at Parcel Post rates. New rates will also be

available for pieces entered at the destination sectional center

facility (DSCF). DSCF rate pieces must be part of a mailing of at least

50 pieces mailed at Parcel Post rates. DSCF rate pieces must be sorted

to 5-digit ZIP Codes as described under ``Mail Preparation'' below.

(3) Balloon Rate. Any item weighing less than 15 pounds and

measuring over 84 inches (but not more than 108

[[Page 37953]]

inches) in combined length and girth will be charged the applicable

Parcel Post rate for a 15-pound parcel.

(4) Oversized Pieces. Pieces in a Parcel Post mailing will be

permitted to measure over 108 inches, but not more than 130 inches, in

combined length and girth. These pieces will be charged new oversized

rates which are higher than the 70-pound rates.

d. Markings

(1) General. Currently, mailers are required to place subclass

markings ``Bound Printed Matter,'' ``Special Standard,'' and ``Library

Rate'' or ``Library Mail'' (or authorized abbreviations) on pieces

qualifying for those rates. However, the Domestic Mail Manual does not

clearly specify where on the mailpiece these markings must appear.

Effective January 10, 2000, the current required subclass markings

(``Bound Printed Matter,'' ``Special Standard,'' and ``Library Rate''

or ``Library Mail'') or their authorized abbreviations will be required

to be placed in the postage area on each mailpiece (i.e., be printed or

produced as part of, or directly below, or to the left of the permit

imprint indicia, meter stamp or impression, or adhesive or precanceled

stamp). The Postal Service prefers that mailers begin to do this as

soon as possible.

(2) Parcel Post Mail. Except for mail qualifying for drop shipment

rates, mailers will have until January 10, 2000, to place a ``Parcel

Post'' or ``PP'' rate marking in the postage area on all Parcel Post

Mail. Effective January 10, 1999, mailings qualifying for the new DSCF

and DDU drop shipment rates must bear the marking ``Drop Ship'' or its

abbreviation ``D/S'' and the marking ``Parcel Post'' or ``PP.'' The

``Parcel Post'' or ``PP'' marking must appear in the postage area

(printed or produced as part of, or directly below, or to the left of

the permit imprint or metered postage) and the marking ``Drop Ship'' or

``D/S'' must appear either in the postage area or in the line above or

two lines above the address as described in DMM M012. DBMC rate mail

will also be required to bear the ``Drop Ship'' and ``Parcel Post''

markings or authorized abbreviations according to these placement

rules. However, since DBMC rate mail is currently required to bear the

marking ``DBMC Parcel Post,'' the Postal Service is allowing mailers a

one-year grace period to convert to the new marking. From January 10,

1999, to January 10, 2000, DBMC rate mailers may use either ``DBMC

Parcel Post'' or ``Parcel Post'' and ``Drop Ship'' (or their applicable

abbreviations). Effective January 10, 2000, DBMC Parcel Post must bear

the new ``Parcel Post'' and ``Drop Ship'' markings, or their applicable

abbreviations.

Effective January 10, 1999, the Postal Service is eliminating the

requirement to show the 5-digit or 3-digit ZIP Code of the post office

of mailing in the drop shipment marking if the postage for the piece is

paid with a permit imprint and the office of mailing is in a different

3-digit ZIP Code area from the post office in the return address. The

requirement for a ``Bulk Rate'' marking also will be eliminated.

Mailpieces bearing the 3-digit ZIP Code of the office of mailing and

``Bulk Rate'' markings will be accepted until January 10, 2000.

(3) Bound Printed Matter. Effective January 10, 2000, the ``Bound

Printed Matter'' marking must appear in the postage area of single-

piece rate mail. Until January 10, 2000, the ``Bound Printed Matter''

marking may appear elsewhere on the mailpiece.

The marking ``Bulk Rate'' or ``Blk. Rt.'' will be changed to

``Presorted'' or ``PRSRT'' for bulk Bound Printed Matter mailings. The

marking ``Presorted Standard'' or ``PRSRT STD'' also will be

permissible. The ``Presorted'' or ``Presorted Standard'' portion of the

marking will be permitted to appear in either the postage area or in

the line above or two lines above the address. Mailers will be given

until January 10, 2000, to begin using the new markings. Between

January 10, 1999 and January 10, 2000, mailers may use either ``Bulk

Rate'' or ``Presorted'' or their respective authorized abbreviation. At

the mailer's option the ``Presorted'' marking may be used instead of

``Bulk Rate'' effective immediately. The name of the rate category also

is changing from bulk Bound Printed Matter to presorted Bound Printed

Matter. At the mailer's option the ``Presorted'' marking may be used

instead of ``Bulk Rate'' effective immediately. Between now and January

10, 2000, the marking ``Bound Printed Matter'' may appear either in the

postage area or in the line above or two lines above the address on

presorted Bound Printed Matter. Effective January 10, 2000, the ``Bound

Printed Matter'' marking on presorted Bound Printed Matter must appear

in the postage area.

For carrier route Bound Printed Matter, the need for the ``Bulk

Rate'' marking in addition to the ``Carrier Route Presort'' marking

will be eliminated effective January 10, 1999. Carrier route Bound

Printed Matter mailings must show ``Bound Printed Matter'' in the

postage area and ``Carrier Route Presort'' or ``CAR-RT SORT'' in the

postage area or in the line above or two lines above the address.

Mailers will be given until January 10, 2000, to place the ``Bound

Printed Matter'' marking in the postage area. Effective January 10,

1999, mailers will be permitted, but not required, to show the

``Presorted'' or ``PRSRT'' (or ``Presorted Standard'' or ``PRSRT STD'')

marking on carrier route Bound Printed Matter in addition to the

required ``Bound Printed Matter'' and ``Carrier Route Presort'' or

``CAR-RT SORT'' markings.

The ``Catalog'' or ``Catalog Rate'' marking will be eliminated for

Bound Printed Matter. Pieces bearing the ``Catalog'' or ``Catalog

Rate'' markings will be accepted until January 10, 2000.

(4) Special Standard. For Presorted Special Standard mail, the

``Presorted'' portion of the current marking will be permitted to be

abbreviated ``PRSRT'' and to appear either in the postage area or in

the line above or two lines above the address. Effective January 10,

2000, the ``Special Standard'' marking must be placed in the postage

area.

f. Mail Preparation--OBMC Presort Discount

To qualify for the Origin Bulk Mail Center Presort (OBMC Presort)

discount, a mailpiece must be part of a mailing of at least 50 Parcel

Post rate pieces. Pieces eligible for the OBMC Presort rate must be

entered at a BMC listed in DMM L601.

Machinable parcels at OBMC Presort rates must: (1) be sorted to

BMCs using DMM labeling list L601 and, (2) be prepared in 69-inch

pallet boxes placed on pallets, each labeled to a BMC and each

containing a minimum of 52 inches of mail. OBMC Presort machinable

parcels must not be prepared as parcels placed directly on pallets.

Overflow containers (pallets, pallet boxes on pallets, or sacks) are

not permitted.

Nonmachinable parcels at OBMC Presort rates must: (1) be sorted to

BMCs and ASFs using new DMM labeling list L605 and, (2) be placed

directly on pallets (no pallet boxes on pallets are allowed), each

labeled to a BMC or ASF and each pallet containing at least 42 inches

of mail. Overflow containers (pallets, pallet boxes on pallets, or

sacks) are not permitted.

Pallets and pallet boxes also must meet the provisions of M041. The

minimum height of mail in a pallet box on a pallet (machinable parcels)

or of mail placed directly on a pallet (nonmachinable parcels) is

measured from the top of the pallet to the top of the lowest mailpiece

(i.e., excludes the height of the pallet).

[[Page 37954]]

g. Mail Preparation--BMC Presort Discount

To qualify for the BMC Presort discount, a piece must meet the same

rules for sorting machinable parcels to BMCs and nonmachinable parcels

to BMCs and ASFs as required for the OBMC Presort discount above. The

difference is that BMC Presort mail may be entered at any postal

facility (other than a BMC in DMM L601) that accepts bulk mailings.

h. Mail Preparation--DSCF Rate

To qualify for the DSCF rate, a piece must be part of a mailing of

at least 50 Parcel Post rate pieces and must be presorted to 5-digit

ZIP Code destinations. Pieces eligible for the DSCF rate must be

entered at an SCF listed in DMM L005 and must be for delivery within

the service area of the entry SCF. For palletized mail only, certain 5-

digit ZIP Codes listed in DMM Exhibit E652.5.0 must be entered at the

BMC facility serving the SCF.

To qualify for the DSCF rates the pieces must be presorted and

labeled to 5-digit sacks or 5-digit pallets (including pallet boxes on

pallets). Machinable and nonmachinable parcels may be combined in the

same sack or on the same pallet (or same pallet box on a pallet) to

meet the minimum sortation requirements. If sacked, each 5-digit sack

must contain a minimum of 7 pieces, except that one overflow sack per

5-digit ZIP Code that contains fewer than 7 pieces is allowed. If

palletized, each 5-digit pallet (including pallet boxes on pallets) in

the mailing must meet one of the following basic minimum preparation

requirements: (1) contain at least 50 pieces and 250 pounds of mail, or

(2) contain at least 36 inches of mail (height of mail excluding

pallet). Overflow from a full 5-digit pallet may be placed in 5-digit

sacks or may be palletized. If the overflow is placed in a 5-digit sack

it will be eligible for the DSCF rates. If the overflow is placed on a

5-digit pallet it is subject to the DBMC rates. Pallets prepared under

the piece and pound minimum and pallets prepared under the minimum

height requirement may both be combined in a single mailing. Sacked

mail and mail palletized according to either of the minimum quantity

options listed above also may be included in the same mailing, provided

that at the time of verification the mailer separates sacks that are

overflow from the palletized portion of the mailing from sacks that

were prepared under the provisions for sacking mail.

If mailers can provide certain documentation, they also may prepare

a mailing exclusively under the following alternate pallet preparation

option. The minimum number of pieces on a 5-digit pallet (including a

pallet box on a pallet) may be 35 pieces and 200 pounds provided that

within the mailing the average number of DSCF pieces per 5-digit pallet

is at least 50. To substantiate that no pallet contains less than 35

pieces and 200 pounds and that the average number of DSCF pieces per 5-

digit pallet in the mailing is at least 50 pieces, mailers must submit

documentation that lists each pallet in sequential order by pallet

identification number. For each 5-digit pallet containing mail claimed

at the DSCF rates the documentation must show: the unique pallet

identification number, the 5-digit ZIP Code of the pallet, the total

weight of pieces on the pallet, the total number of pieces on the

pallet, and the cumulative total of pieces (i.e., the number of pieces

on that pallet plus the sum of the pieces on all 5-digit pallets

qualifying for the DSCF rates listed before it). Under this alternate

pallet option, overflow from a full 5-digit pallet may be placed in 5-

digit sacks or may be palletized. If the overflow is placed in a 5-

digit sack, it will be eligible for the DSCF rates. If the overflow is

placed on a 5-digit pallet, it is subject to the DBMC rates. Mailers

using this 50-piece average-per-pallet alternative must exclude pieces

that are prepared as overflow under any of the foregoing methods

(sacked or palletized) from the computation (documentation) that the

50-piece per pallet average is met.

For any palletization option, mailers may place parcels directly on

pallets or in pallet boxes on pallets. If pallet boxes are used they

must not exceed 60 inches in height and must otherwise meet the

provisions for pallet boxes in DMM M041. All pallets must meet the

provisions of DMM M041.

Under any palletization option, the following additional

requirements or restrictions also apply. Currently, many BMCs transport

mail for certain 5-digit ZIP Code areas directly to the 5-digit

associate post office. A list of these 5-digit areas is found in DMM

Exhibit E652.5.0. Five-digit pallets prepared for the DSCF rate for the

5-digit ZIP Codes listed in this exhibit must be entered at the BMC,

not at the SCF, to qualify for the DSCF rate. This will avoid

additional handling and transportation of this mail at the affected

SCFs. However, sacked mail for the 5-digit ZIP Codes listed in Exhibit

E652.5.0 must always be entered at the SCF (not at the BMC). There is

one exception to this rule provided for in DMM E652.1.3. This rule

allows a mailer to request from the Area Manager, Operations Support,

an exception to the requirement to drop palletized mail for the ZIP

Codes in Exhibit E652.5 at the BMC. Such exceptions must be requested

at least 15 days in advance and may only be granted for a limited time.

In addition, there are certain associate post offices that cannot

handle pallets. A list of these facilities is found in the Drop

Shipment Product currently available from the National Customer Support

Center (NCSC) in Memphis, TN (1-800-238-3150). For these 5-digit ZIP

Codes, the DSCF rate will be available only for mail that can be

prepared in 5-digit sacks as described above (i.e., the DSCF rate will

not be available for palletized mail for 5-digit delivery units that

cannot handle pallets).

In instances where the Drop Shipment Product shows that mail for a

single 5-digit ZIP Code area is delivered from more than one facility,

the facility listed in the Drop Shipment Product that delivers mail to

the majority of city carrier routes will be considered the delivery

unit for parcel post. Two exhibits, Exhibits E652.6.0 and E652.7.0 that

contain exceptions to the ``majority of city carriers'' rule, are also

added to the DMM. If a 5-digit ZIP Code is listed in DMM Exhibit

E652.6.0 or E652.7.0, the facility listed in one of those exhibits must

be used to determine the name of the delivery unit. The name of the

delivery unit must then be looked up in the Drop Shipment Product to

determine if mail for it, and therefore mail for the 5-digit ZIP Code,

can be prepared on pallets to qualify for the DSCF rate. At some point

in the future the information in these two exhibits will be

incorporated in the Drop Shipment Product.

Nonmachinable outside (NMO) parcels by definition cannot be

prepared in sacks because they will not fit in a sack. Therefore, NMOs

must be prepared directly on pallets or in pallet boxes on pallets as

described above to qualify for the DSCF rates. If overflow pallets are

prepared, the pieces on such pallets are subject to the DBMC rates. The

DSCF rate is not available for NMOs at those facilities listed in the

Drop Shipment Product, and Exhibits E652.6.0 and E652.7.0, as unable to

handle palletized mail.

The Postal Service will unload palletized loads for DSCF rate mail.

Mailers must unload sacked and bedloaded mailings. A provision has been

added to allow mailers to prepare 5-digit sacks qualifying for the DSCF

rate on SCF pallets. Such SCF pallets have no minimum pallet weight and

may be prepared without having to first prepare all possible 5-digit

pallets. A

[[Page 37955]]

special pallet label is prescribed for this mail in M045.12.

Except for local mailings, appointments for dropping any Standard

Mail (B) at an SCF must be scheduled through the appropriate district

control center (see DMM E652).

i. Mail Preparation--DDU Rate

To qualify for the DDU rate, a piece must be part of a mailing of

at least 50 Parcel Post rate pieces. Pieces eligible for the DDU rate

must be entered at the postal facility where the carrier who delivers

the parcel is located. A list of these facilities and their telephone

numbers are in the Drop Shipment Product currently available from the

National Customer Support Center (NCSC) in Memphis, TN, 1-800-238-3150.

In instances where the Drop Shipment Product shows that a 5-digit area

is served by more than one facility, the facility that delivers mail to

the majority of city carrier routes should be used for purposes of

determining where to enter a destination delivery unit mailing.

Exceptions to that general rule are those ZIP Codes listed in DMM

Exhibit E652.6.0 and in Exhibit E652.7.0. If a ZIP Code appears in DMM

Exhibit E652.6.0 or Exhibit E652.7.0, the mail must be entered at the

delivery unit listed in the exhibit for that ZIP Code.

There are no specific sortation requirements for the DDU rates

other than the requirement that mail must be separated by 5-digit ZIP

Code when unloaded at a DDU facility. Mailers may choose to sack or

palletize DDU rate pieces. If so, there are no minimum sack or pallet

requirements but the sack or pallet must be labeled as a 5-digit sack

or pallet. Mailers may present mail to the DDU prepared in pallet boxes

on pallets provided the pallet boxes do not exceed 60 inches in height

and otherwise meet the provisions of M041. The Drop Shipment Product

and DMM Exhibits E652.6.0 and E652.7.0 may be used to determine which

postal facilities can handle pallets. If the facility cannot handle a

pallet, and mail is transported to the facility on pallets, the mailer

must unload the mail from pallets into a container as specified by the

delivery unit.

The mailer will be responsible for unloading all DDU loads (even if

palletized). If palletized and the pallets are stacked, the mailer will

be responsible for unloading, unstacking, and removing the strapping

material from the pallets. Appointments for entry must be made by

contacting the DDU at least one day in advance. Mailers desiring

electronic confirmation of DDU mail entry also must schedule the

appointment through the district control center. Standing appointments

may be made if shipment frequency is weekly or more frequently. The

grace period for late arrivals will be 20 minutes.

j. Destination Entry Mail Preparation--Plant-Verified Drop Shipment

(PVDS)

Pieces must be part of a mailing of at least 50 Parcel Post rate

pieces to qualify for DDU, DSCF, and DBMC rates and to qualify for OBMC

Presort, BMC Presort, and barcoded discounts. When Parcel Post rate

pieces are submitted under PVDS procedures, mailers may use the total

of all line items for all destinations on a PVDS register or PVDS

postage statement to meet the minimum 50-piece volume requirement. This

means a mailer may enter fewer than 50 pieces at an individual

destination, provided there is a total of at least 50 Parcel Post rate

pieces for all of the entry points for that single mailing job listed

on the PVDS register or PVDS postage statement.

k. Bulk Parcel Post

Bulk Parcel Post is a ``shell'' classification of Standard Mail (B)

for which there are no separate rates prescribed. Current DMM E620.2.4e

states that ``the bulk Parcel Post rate is the rate applicable to each

piece in a bulk Parcel Post rate mailing at the single-piece rate or

DBMC rate for that zone for an item equal to the average weight per

piece for all parcels in the mailing to that zone, rounded up to the

next whole pound.'' This DMM section therefore establishes a method of

computing postage at Parcel Post rates. For mailings of identical

weight pieces, this averaging method is irrelevant, because the average

weight of all the pieces to a zone is always the weight of a single

piece. For mailings of nonidentical weight pieces, DMM E620.2.2b states

that this method of postage payment may be used only if authorized by

the rates and classification service center (RCSC) serving the post

office of mailing. The Postal Service is removing sections E620.2.2 and

E620.2.4e from the DMM. Postal Service Headquarters is not aware of any

mailer that is currently authorized to use this method of postage

payment. If in fact there are mailers using this method, they may

request that their RCSC issue an authorization for continuation of

their postage payment procedure as an alternate mailing system under

DMM P730. The Postal Service is implementing various new rates and

discounts for Parcel Post that could be considered ``bulk rates''

because they require a minimum volume of 50 pieces per mailing.

Therefore, removing references to ``Bulk Parcel Post'' rates in DMM

E620 will reduce confusion in the eligibility section for Parcel Post

rates in new DMM E630. As indicated above, the Postal Service also will

be removing the requirement to mark pieces with a ``Bulk Parcel Post''

rate marking. New DMM E630.6.0 is reserved for any future rates and

requirements for the Bulk Parcel Post classification.

7. Special Services

a. Address Correction

No changes will be made to address correction service fees. They

will remain at $0.50 for manual corrections and $0.20 for automated

(ACS) corrections, per notice issued.

b. Address Changes for Election Boards

No changes will be made to the fee. It will remain $0.17. See DMM

R900.10.3.

c. Business Reply Mail (BRM)

(1) Fees and Per-Piece Charges. The annual permit fee will increase

from $85.00 to $100.00, and the annual accounting fee will increase

from $205.00 to $300.00. For regular BRM, mailers will pay the

applicable First-Class Mail rates plus a per-piece charge. The per-

piece charge for regular BRM with an advance deposit account will

decrease from $0.10 to $0.08. The per-piece charge for regular BRM

without an advance deposit account will decrease from $0.44 to $0.30.

(2) Qualified Business Reply Mail. A new classification category

and rate structure will be added for qualified business reply mail

(QBRM) that must be letter-size, automation-compatible, and barcoded.

As a result, the BRMAS fee category will be eliminated. The First-Class

rate structure for QBRM includes a lower single-piece first-ounce rate

of postage of $0.30 for letters and $0.18 for cards. The fee structure

requires an annual BRM permit fee, an annual BRM accounting fee, and

for each piece returned a $0.05 per-piece BRM charge.

(3) Mailpiece Design and Barcoding Requirements. Mailpiece design

and barcoding requirements will be revised for both regular BRM and

QBRM. Regular BRM pieces that bear a barcode and QBRM pieces that bear

a barcode will be required to meet the automation letter mailpiece

design requirements in DMM C810 (except C810.7.1) and the barcoding

standards in C840 so that there are uniform requirements for all mail

that is processed on barcode sorters.

For barcoded and nonbarcoded BRM, references to mailpiece design

[[Page 37956]]

requirements in DMM C810 and C830 will replace current BRM standards

relative to reflectance requirements, paper weight, tabs and self-

mailers. This will add basis weight, tabbing, and other requirements

for all self-mailers. It is likely that self-mailers will be processed

on automated equipment. Meeting these requirements will ensure their

ability to be processed without damage. QBRM and other barcoded

mailpieces must meet all the mailpiece design requirements in C810

except the requirement in C810.7.1. The basis weight requirement for

envelopes in C810.7.1 will not apply to BRM. BRM envelopes, including

QBRM, must continue to meet the current minimum paper basis weight of

20 pounds (measured using 500 sheets of 17- by 22-inch paper). In

addition, the standard in current S922.6.4 that envelope material must

not have a phosphorescence exceeding 4.0 phosphor meter units is

retained and corrected to state that envelope material must not have a

red fluorescence exceeding 4.0 phosphor meter units. Mailers will have

until January 10, 2001, to comply with the requirement in DMM C810.2.1c

that Qualified Business Reply Mail pieces and other BRM pieces that

bear a barcode and measure more than 4\1/4\ inches by 6 inches meet a

minimum thickness requirement of .009 inch.

Mailers currently have the option of preparing pieces with lower

right barcodes according to the standards in C840. They also currently

have the option of preparing the pieces so that the left boundary of

the barcode clear zone and of a lower right barcode window is \1/4\

inch closer to the right edge of the mailpiece than required under

C840, and to place the leftmost bar of a lower right barcode \1/4\ inch

closer to the right edge of the mailpiece than required under C840. The

revised standards will no longer permit mailers to use the option that

does not meet the DMM C840 requirements. However, mailers will be given

until January 10, 2001, to use existing stocks of such prebarcoded BRM

envelopes and cards that: (1) Have a barcode clear zone with a left

boundary that is 4\1/2\ inches from the right edge of the piece (not

4\3/4\ inches as required in C840); (2) have a lower right barcode for

which the leftmost bar is located between 3\1/4\ and 4 inches from the

right edge of the piece (not between 3\1/2\ and 4\1/4\ inches as

required under C840); (3) have a lower right barcode window, that has a

left boundary measuring 4\1/2\ inches from the right edge of the piece

(not 4\3/4\ inches as required under C840).

The revised standards also will allow a company logo to appear

beneath the delivery address line of a prebarcoded BRM or QBRM

mailpiece, provided the logo is placed no lower than \5/8\ inch from

the bottom edge of the mailpiece and does not interfere with the

barcode clear zone.

d. Carrier Sequencing of Address Cards

The fee will increase from $0.17 to $0.20. See DMM R900.1.0.

e. Certificate of Mailing

The fees will increase. See DMM R900.4.0.

f. Certified Mail

The fee will increase from $1.35 to $1.40. See DMM R900.5.0.

g. Collect on Delivery (COD)

COD fees will increase. See DMM R900.6.0. The standards in DMM S921

will also be revised to remove references to the availability of COD

with single-piece Standard Mail (A).

h. Correction of Mailing Lists

The per-correction fee will be increased from $0.17 to $0.20 and

the minimum per-list fee is increased from $5.50 to $7.00. See DMM

R900.10.1.

i. Delivery Confirmation

A new delivery confirmation service will be available for Priority

Mail and Standard Mail (B) in early 1999. This service, when available,

will provide the mailer with information about the date of delivery or

attempted delivery. This service will be available in two forms: (1) an

electronic option for mailers who apply identifying barcodes to each

piece, provide an electronic manifest, and retrieve confirmation

information electronically; and (2) a retail (manual) option for which

delivery information will be available through a USPS Internet address

or a toll-free number. Signature (electronic return receipt) service

also will be available in early 1999.

j. Express Mail Insurance

The fees for merchandise insured for $500.01 to $5,000.00 will

increase. See DMM R900.8.0.

k. Insured Mail

The fees for insurance service will increase. See DMM R900.9.0. The

DMM provisions in S913 will be revised to delete the applicability of

insurance to single-piece Standard Mail (A). Since single-piece

Standard Mail (A) will be eliminated, mail that was formerly mailed at

those rates will be subject to single-piece First-Class Mail or

Priority Mail rates as applicable for the weight of the mailpiece.

Because First-Class Mail and Priority Mail may be insured, mailpieces

formerly mailed at single-piece Standard Mail (A) rates will retain

their eligibility for insurance when mailed at First-Class Mail or

Priority Mail rates.

In addition, a bulk insurance service discount of $0.40 per piece

is introduced. To be eligible for the bulk insurance service discount,

mailers must (1) enter mailings of insured articles under an approved

manifest mailing system agreement, (2) mail a minimum of 10,000 insured

articles annually (a total of all insured articles mailed at multiple

locations), (3) provide a hard copy of Form 3877, Firm Mailing Book for

Accountable Mail, or facsimile and (4) provide a copy of Form 3877 on a

diskette or other electronic medium. Mailers must submit an application

for bulk insurance to their local postmaster or designee. The local

postmaster or designee will approve or deny the application. Authorized

mailers will be provided instructions for filing claims under the bulk

insurance service by the local postmaster or designee. When systems

that electronically capture information on accountable mail are

completed and programming changes that will tie the St. Louis ASC into

these systems are completed, mailers will be required to file claims

electronically using a new (soft) electronic format for the Form 3877.

When or before these changes and systems are completed, bulk insurance

mailers will be provided with instructions for a new format for the

electronic Form 3877 and with instructions for electronically filing

claims.

l. Merchandise Return Service

The annual permit fee will increase from $85.00 to $100.00. The

charge per returned mailpiece remains at $0.30. Revisions are made to

the postage that is applicable to pieces returned that weigh less than

16 ounces and to the marking requirements that specify the return rate

of postage. These changes will be necessary because of the elimination

of single-piece Standard Mail (A) rates. Matter bearing a merchandise

return label without a preprinted rate marking will be returned at: (1)

the Parcel Post rate if it weighs 16 ounces or more, (2) the Priority

Mail rates if it weighs over 13 ounces but less than 16 ounces, and (3)

the First-Class Mail rates if it weighs 13 ounces or less. If the

permit holder desires matter to be returned the Special Standard, or

Library Mail rates, the permit holder will be required to preprint the

appropriate rate marking on the label. If the permit holder desires

matter

[[Page 37957]]

weighing 13 ounces or less or matter weighing 16 ounces or more to be

mailed at the Priority Mail rates, the mailer will be required to

preprint the Priority Mail marking on the merchandise return label. It

is recommended but not required that matter to be returned at the

First-Class Mail, Priority Mail, or Parcel Post rates bear the

applicable preprinted marking ``First-Class'' or ``First-Class Mail,''

``Priority Mail,'' or ``Parcel Post'' (or ``PP'').

m. Money Orders

The fee for domestic money orders will be reduced from $0.85 to

$0.80. The fee for a postal military money order will remain at $0.30

and the inquiry fee will remain at $2.75.

n. On-Site Meter Settings

There will be increases to two of the on-site meter setting fees.

The fee for an additional meter setting will increase from $3.25 to

$4.00, and the fee for checking a meter in and out of service will

increase from $7.50 to $8.50. No increases will be made to the

scheduled appointment setting fee for the first meter ($27.00) or to

the unscheduled or emergency setting fee for the first meter ($31.00).

o. Parcel Airlift

There will be no changes to parcel airlift fees ($0.40 for up to

two pounds, $0.75 for over two up to three pounds, $1.15 for over three

up to four pounds, and $1.55 for over four pounds).

p. Permit Imprint

The application fee for permit imprints will increase from $85.00

to $100.00.

q. Post Office Boxes, Caller Service, and Reserve Call Numbers

Post office box fees (except the $0 fee for all box sizes in Group

E) will increase. Fees for caller service and reserve call numbers also

will increase (see R900.3.0 and DMM R900.16.0).

r. Registered Mail

The maximum value level for registered mail without postal

insurance will be decreased from $100.00 to $0.00. All registered mail

with a value of $0.01 or more will be automatically provided with

insurance (up to a maximum indemnity of $25,000 per piece). Insurance

coverage is included in the applicable registered mail fee. Only mail

of no value may be mailed as uninsured registered mail. In addition,

registered mail fees will increase (see DMM R900.18.0).

s. Restricted Delivery

The restricted delivery fee will not change (it remains $2.75).

t. Return Receipt

Fees for return receipt will increase from $1.10 to $1.25 when

requested at time of delivery and from $6.60 to $7.00 when requested

after mailing.

u. Return Receipt for Merchandise

The fee for return receipt for merchandise will increase from $1.20

to $1.40, and the fee for a delivery record will increase from $6.60 to

$7.00. DMM S917 will be revised to delete the availability of this

service with single-piece Standard Mail (A), because single-piece

Standard Mail (A) will be eliminated.

v. Special Handling

There will be no change to the fees for special handling ($5.40 for

matter weighing not more than 10 pounds and $7.50 for matter weighing

more than 10 pounds). In addition, DMM S930.1 will be revised to

conform to the Domestic Mail Classification Schedule (DMCS) by making

it clear that special handling may be used with First-Class Mail and

Priority Mail.

w. Stamped Cards

A $0.01 fee per stamped card and a $0.02 fee per double stamped

card will be added to cover manufacturing and printing costs. A fee of

$0.40 will be added to the price of a sheet of 40 stamped cards. This

is consistent with the existing fee structure for stamped envelopes,

where customers are charged postage plus a small fee for the envelope

itself.

x. Stamped Envelopes

The fees for some stamped envelopes will increase and others will

decrease. In addition, the fee structure will be simplified: except for

hologram stamped envelopes, all stamped envelopes will be grouped

together by size and whether they are plain or printed.

y. ZIP Coding of Mailing Lists

Fees will increase from $60.00 to $70.00 per 1,000 addresses or

fraction thereof.

C. Summary of Comments From the March 16, 1998, Proposed Rule

The Postal Service received 32 pieces of correspondence offering

comments on the March 16, 1998, proposed rule. Respondents included

five major mailer associations; 24 publishers, printers, and mailers;

and three individuals.

The specific points raised in the comments are presented below,

organized by general comments and then by class of mail and special

service.

1. General Comments

Three comments were received concerning the implementation date of

the new rates, fees, and classifications. Each commenter indicated that

the implementation date should allow time for mailers to make software

changes. Suggested dates ranged from 90 days to 8 months after the

Board of Governors' decision. The implementation date for Docket No.

R97-1 is determined by the Board of Governors of the Postal Service and

is outside the scope of this rulemaking process. Postal management did

however, consider these comments when it provided advice to the Board

of Governors concerning the effective dates.

Various comments also were received that requested changes to rates

and fees. One commenter requested that the revised rates not apply to

his company for two to five years. These comments are beyond the scope

of this rulemaking. The rates, rate structure, and basic standards for

rates in Docket No. R97-1 were subject to litigation before the Postal

Rate Commission and cannot be revised unilaterally by the Postal

Service in a rulemaking process.

Three commenters requested that a single item not be subject to

both a hazardous medical materials and an other hazardous materials

surcharge. As the PRC did not recommend the proposed hazardous

materials surcharges, these comments will not be addressed.

One commenter indicated that the Postal Service should re-solicit

comments for any items that were affected by the PRC decision. Because

the Postal Service cannot revise rates and DMCS language that is

recommended by the PRC and approved by the Governors of the Postal

Service, it does not believe that soliciting comments on such items

would have any value.

2. Priority Mail

One commenter requested clarification as to whether Priority Mail

must always bear the ``Priority Mail'' marking. This commenter further

asked whether the ``Priority Mail'' marking will delay the mail when

deposited in an overnight First-Class Mail area and, if so, could such

mail pieces be marked ``First-Class'' instead of ``Priority Mail.''

Priority Mail must always bear the marking ``Priority Mail'' or

``Priority.'' This marking is used to ensure that mail is placed in and

processed through the Priority Mail network and to collect cost

[[Page 37958]]

and revenue data through the Postal Service's statistical sampling

systems. Deployment of the Priority Mail Processing Center (PMPC)

network has affected overnight service standards for some ZIP Codes.

While the vast majority of service standard changes have resulted in

improved service, there are, as the commenter suggests, a small number

of 5-digit ZIP Code areas that may experience two-day service instead

of overnight. However, the Postal Service does not plan to waive the

marking requirement for pieces mailed in such 5-digit ZIP Code areas.

3. First-Class Mail

Two commenters requested that the Prepaid Reply Mail proposal

should not be implemented because of administrative complexity and

costs to the mailer. For other reasons, the Governors did not approve

Prepaid Reply Mail.

One commenter supported the provision allowing ``Presorted'' to be

abbreviated ``PRSRT'' when used in the ``Presorted First-Class''

marking. Another commenter was concerned that it appeared the revised

DMM M012.2.1a required single-piece First-Class Mail to bear a ``First-

Class'' marking. The Postal Service has revised DMM M012 to make it

clear that single-piece First-Class Mail is not required to bear a rate

marking.

4. Periodicals

Two commenters suggested that for clarity, proposed DMM E230.3.0b

and E230.4.0b concerning eligibility for 5-digit and 3-digit presort

rates be revised to indicate that 5-digit and 3-digit packages of 6 or

more pieces may be palletized under M045 to obtain the 5-digit and 3-

digit presort rates. The Postal Service has adopted this suggestion.

Two commenters suggested that the forwarding rules table in DMM

F010.5.2g should be clarified so it does not appear that use of ACS

will always result in the return of the mailpiece. One of these

commenters suggested that it would be clearer if the entire chart in

this DMM section had been reproduced so that it was clear that footnote

1 stating ``Valid for all pieces, including Address Change Service

(ACS) participating pieces'' also applied to pieces that bear no

endorsement. When Periodicals pieces bear no endorsement, after 60 days

or, if the piece is undeliverable, a separate address correction or

reason for nondelivery is provided, the address correction fee is

charged (the automated fee if ACS service is used), and the piece is

disposed of by the Postal Service. The entire chart in DMM F010.5.2g is

reproduced in this final rule to make it clear that this policy has not

changed.

One commenter indicated that it appeared the Postal Service intends

to revise current rules in DMM F010.6.1 to require that Periodicals

mail with a nonincidental First-Class attachment be returned to the

mailer. The Postal Service revisions to DMM F010.6.1 in both the

proposed and this final rule revise only the rate of postage at which

such pieces are returned from the single-piece Standard Mail (A) rate

to the First-Class or Priority Mail rate as applicable for the weight

of the piece. Postal Service policy for some years has provided that

Periodicals pieces with nonincidental First-Class Mail attachments be

returned. However, Periodicals pieces with incidental First-Class Mail

attachments, as defined in DMM M070.5.0, are treated as dead mail

unless endorsed ``Address Service Requested.'' To avoid confusion, in

Part D of this final rule, the Postal Service has published DMM

F010.6.1 in its entirety to show the treatment of incidental First-

Class attachments as well as treatment of nonincidental First-Class

attachments.

One commenter indicated that the current interpretation of

``mailing'' for Periodicals allows mailers to treat and report mail for

different rate categories, including automation mail, carrier route

mail, and other non-automation mail, as one ``mailing.'' This commenter

asked if the proposed definition of a mailing in DMM M011.1.4 would

require that a separate mailing statement be prepared for each rate

category of Periodicals mail. The DMM currently does not allow

preparation of automation, carrier route, and other non-automation mail

in a single ``mailing.'' Separate presort and eligibility requirements

are prescribed for each of these rate categories. However, each of

these rate categories are permitted to be reported on a single postage

statement for a single publication and edition. To clarify that the

current practice continues to be permitted, a new section DMM M011.1.4d

has been added concerning ``mailings'' of Periodicals.

5. Standard Mail (A)

Five commenters indicated their support for allowing pieces in an

Enhanced Carrier Route rate mailing and/or in an automation rate

mailing that have each separately met a 200-piece or 50-pound minimum

quantity requirement to be counted toward the minimum quantity

requirement for a Presorted Standard (\3/5\ and basic rate) mailing,

provided that (1) the Enhanced Carrier Route rate mailing and/or the

automation mailing and the Presorted Standard mailing are part of the

same mailing job, and (2) the mailings are all reported on the same

postage statement.

One commenter asked what DMM section E612.4.6 means. DMM E612.4.6

contains provisions that allow Standard Mail (A) matter weighing less

than 16 ounces to pay Standard Mail (B) rates if those rates are lower

than Standard Mail (A) rates and the matter and the mailing could

qualify for the Standard Mail (B) rate except for weight. For example,

suppose a mailer had flat-size printed matter pieces that met all of

the qualifications for Bound Printed Matter except that the pieces each

weighed 4 ounces and therefore did not meet the requirement of weighing

at least one pound. In such an instance the mailer could presort the

pieces as Standard Mail (A) flats and claim basic presorted Bound

Printed Matter rates if those rates were less than the applicable

Standard Mail (A) rates. The mailer could presort the pieces according

to the Presorted Standard Mail (A) requirements to 5-digit, 3-digit,

ADC, and mixed ADC, which are similar to the presort requirements for

presorted Bound Printed Matter, and claim the local zone Bound Printed

Matter rates provided the mailer marked the pieces ``Presorted'' or

``Presorted Standard'' and ``Bound Printed Matter'' and submitted

documentation to substantiate that the pieces qualified for the local

zone rate.

One commenter requested that the Postal Service not apply the

residual shape surcharge to Enhanced Carrier Route rate merchandise

samples prepared with detached labels. The Postal Rate Commission

recommended and the Governors of the Postal Service approved a residual

shape surcharge for Enhanced Carrier Route mail. Since these provisions

are in the Domestic Mail Classification Schedule to take effect January

10, 1999, the Postal Service cannot unilaterally change these

provisions. Therefore, merchandise samples at the Enhanced Carrier

Route rates will be subject to the residual shape surcharge.

One commenter requested that the Postal Service revise the rule

placed into effect under Classification Reform that allows mail whose

size meets both the letter-size requirements and the automation flats

requirements to be prepared as flats on pallets if a portion of the

mailing qualifies for automation flats and if palletized mail at the

Presorted Standard rates is limited to 10% of the total palletized

mail. This rule further requires that mail unable to be palletized

either due to density or because it exceeded the 10% limit be prepared

as a separate letter-size mailing. This issue is not related to the

[[Page 37959]]

implementation rules for the Docket No. R97-1 rate case and will not be

revised as a part of this rulemaking process. However, this matter has

been brought to the attention of the Presort Optimization working group

of the Mailers Technical Advisory Committee.

One commenter indicated that on occasion he will have a mailing

that is set up as Standard Mail (A) (i.e., bears Standard Mail (A) rate

markings and pre-printed endorsements for Change Service Requested

using ACS) and subsequently discover that a particular mailing list has

fewer than 200 names. Such a mailing would not qualify for Standard

Mail (A) rates, and would be subject to single-piece First-Class Mail

rates, unless it could meet the revised volume requirements under DMM

E620.1.2. This commenter indicated that he could cover the bulk rate

indicias with First-Class stamps, but that the ACS participant code on

the mailpieces would be that assigned for Standard Mail (A), not First-

Class. This commenter accordingly asked if changes could be made to the

Centralized Forwarding System (CFS) to handle this, and if not, asked

how could it be mailed. The CFS system cannot be modified to handle

such instances. It would be unlikely that a postal employee would be

able to tell that such a mailpiece was modified from a Standard Mail

(A) mailpiece if a stamp is covering the bulk rate indicia.

Furthermore, if mailers added ``single-piece'' or ``single-piece First-

Class'' markings to such mailpieces it would be difficult and time

consuming to have carriers search all undeliverable mailpieces for such

markings in order to forward them to CFS sites, and then for CFS

employees to notice the markings and respond accordingly. Two options

have been added to the DMM for payment at First-Class or Priority Mail

rates for such pieces and for pieces that for other reasons are subject

to the appropriate First-Class Mail or Priority Mail rates. Mailers who

desire to receive First-Class Mail or Priority Mail service on

mailpieces subject to those rates must re-envelope or otherwise prepare

the mailpieces so that they bear only the proper First-Class Mail or

Priority Mail rate markings, ancillary service endorsements, Address

Change Service (ACS) codes, etc. Metered pieces weighing over 13 ounces

and less than 16 ounces must always be prepared under this method.

Except for metered pieces weighing over 13 ounces and less than 16

ounces, mailers who do not desire to receive First-Class Mail or

Priority Mail service on such pieces may submit them ``as is'' (i.e.,

bearing the Standard Mail (A) markings and endorsements). No additional

markings or postage are to be added to these pieces. First-Class Mail

or Priority Mail postage must be paid for these pieces using the

appropriate First-Class or Priority Mail postage statement. Except for

metered pieces weighing over 13 ounces and less than 16 ounces, mail

bearing metered or precanceled stamp postage must pay the difference

between the postage affixed and the First-Class Mail or Priority Mail

rates by means of an advance deposit account or by affixing a meter

strip for the appropriate amount to the First-Class postage statement.

If the pieces weigh 13 ounces or less, mailers must use special line

items on the new First-Class postage statements under the heading

``From Standard Mail (A)'' to record the pieces mailed. This option may

be used for fewer than 200 pieces of permit imprint mail only if the

pieces were part of a larger mailing job and are submitted for

acceptance along with the mail and a Standard Mail (A) postage

statement for the other pieces in the same mailing job.

One commenter was concerned that the revised definition of a

mailing in DMM M011.1.4d(6) seemed to preclude his company's current

practice of co-mailing Nonprofit and Regular rate mail. This section

has been renumbered as M011.1.4e(6) in this final rule. This section

begins with the phrase ``Except as provided by standard,'' which means

that other rules in the DMM may permit practices that entail combining

or copalletizing such pieces. For clarity the following sentence was

added to this section in the final rule. ``See M041.6.0, M045.5.0,

M045.7.0, and M200.6.0 for copalletized, combined, or mixed-rate level

mailings.'' Accordingly, if a mailer is currently authorized to combine

or copalletize Nonprofit and Regular rate mail, he or she may continue

to do so after the new rates and mailing definitions are effective.

Two commenters supported the change in the Standard Mail (A) rate

marking for Regular rate mailings from ``Bulk Rate'' to ``Presorted

Standard.'' Two commenters indicated that the ``Presorted Standard''

marking should be optional. These two commenters indicated that they

would prefer to use the new marking on their advertising mail but do

not wish to use it on fulfillment parcels because it will be costly to

revise the current cartons. One of these commenters indicated that if

the marking is not made optional, there should be a transition period

of at least two years for mailers to convert to the new marking. For

simplicity in its statistical sampling systems, the Postal Service will

not allow both markings to be used indefinitely. However, mailers will

be given two years to convert their regular rate Presorted, regular

rate automation, and regular rate Enhanced Carrier Route mailings to

the new ``Presorted Standard'' marking or its authorized abbreviation

``PRSRT STD.'' Until January 10, 2001, either the ``Bulk Rate'' or the

``Presorted Standard'' marking or authorized abbreviation will be

accepted.

Five commenters requested that the proposed ``RSS'' marking for

pieces subject to the residual shape surcharge be eliminated. Four of

these commenters indicated the marking uses too much space on a

mailpiece, one indicated that it detracts visually from the mailpiece,

two did not see the purpose of it, and one indicated it would require

additional labor for the shipper. One commenter was a mailer

association, who indicated it would be impossible for some of its

mailers to predict which pieces would need the marking. One such mailer

has pieces that could be considered either flat-size or a machinable

parcel and decides which way to prepare the mail based on the density

of orders received. Only machinable parcel mailings would need to bear

the marking. Another such mailer indicated they cannot predict the

final size of the product shipped ahead of time. For example, multiple

pieces ordered could be sent as one or more pieces each having a

different shape. Based on the comments received, the Postal Service has

determined to not require the use of an ``RSS'' marking.

6. Standard Mail (B)

a. General

There were 10 commenters among the 32 submitting comments to the

Postal Service whose statements concerned Standard Mail B topics. Of

the 10, seven were private firms, including three parcel consolidators,

and three were parcel shipper associations. Their comments concentrated

mainly on the following subject areas: barcoded discount, destination

mailings at the sectional center and delivery unit levels; new bulk

mail center presort (BMC Presort) and origin bulk mail center presort

(OBMC Presort) discounts; 10% limitation on oversized parcels; criteria

for machinability and nonmachinability; combined mailings of Standard

Mail (A) and Standard Mail (B) parcels; and vehicle unloading

requirements.

In addition to receiving comments as part of the formal rulemaking

process, the Postal Service has had extensive ongoing exchanges of

viewpoints with representatives of the parcel shipping industry. This

cooperative effort has led

[[Page 37960]]

to the development of revised standards that the Postal Service

believes strikes a better balance between the interests of mailers and

their concerns about qualifying for the most advantageous postage rate

discounts at the lowest possible mailing costs and the needs of the

Postal Service for providing high-quality service, containing costs,

and optimizing operational efficiency. Significant revisions have been

made in the proposed standards, especially as they relate to mail

preparation requirements for the new destination sectional center and

delivery unit discount rates.

Several other issues unrelated to the R97-1 rate case emerged and

are not addressed in the final standard. These issues concern extension

of the destination bulk mail center rates (DBMC) to Alaska, Hawaii, and

Puerto Rico, new criteria for parcel machinability or nonmachinability,

and updated definitions of ``perishable'' and ``nonperishable'' parcels

that take into account improved packaging and containerization. They

will be reviewed separately by the Postal Service in the future and any

changes to existing standards will be handled through separate

rulemaking procedures.

b. Parcel Barcodes

Two commenters indicated that they would support a barcode

certification process, and that this process should be published at

least 60 days prior to rate availability. In lieu of a barcode

certification process, the Postal Service is looking at methods to

verify the quality of barcodes during the verification process using

commercially available barcode verification equipment.

One commenter indicated that the barcoded discount should be

available for pieces processed at any postal facility that is automated

to use the ZIP Code barcode for sorting, including ASFs that now or in

the future have barcode scanning capabilities. The Postal Service has

determined that the Phoenix, Arizona, ASF has barcode scanning

capabilities. Accordingly, the Postal Service has revised the standards

for eligibility for the barcoded discount for Parcel Post mail to

include machinable parcels eligible for the DBMC rate that are entered

at the Phoenix ASF.

One commenter raised a question about the need for having human-

readable characters representing the 5-digit barcode appear on a

mailpiece's address label since it duplicates information already

provided in the address and takes up limited label space. Having the

human-readable ZIP Code appear as part of the barcode printing process

immediately below the barcode is useful in determining that the correct

barcode was applied to the mailpiece, particularly if the barcode is

applied in a process separate from applying the address. Since

generally the ZIP Code in the address block is used in the process of

applying an address block barcode, the Postal Service has decided to

revise the standard. Therefore, the numeric equivalent of the barcode

will not be required to appear immediately below the barcode when the

barcode is printed as part of the address block (on the same label as

the mailing address and in close proximity to that address). However,

if the barcode label is produced separately from the address label, the

human readable ZIP Code information must be included. This decision

will give mailers some flexibility in how they prepare their address

labels while still meeting postal concerns about having barcodes that

are correct for the addresses on the parcels.

Another commenter raised several questions about the technical

specifications included in the proposed rule. Clarification was

requested for the average measured narrow element (bar or space) width.

The average measured narrow element is the barcode X-dimension that

typifies the arithmetic mean of the barcode narrow elements. A minimum

clear or quiet zone equal to 10 times the average measured narrow

element (bar or space) width must be maintained on either side of a

barcode as defined in ANSI X3.182-1990.

A second question was whether mailers and their suppliers would

have to start measuring barcode spaces and bar widths more

scientifically to determine what dimension is appropriate for the clear

space surrounding parcel barcodes on either side. The Postal Service is

confident that mailers will be able to determine the average narrow

element widths and barcode quality by using commercially available

barcode verification equipment.

A related question had to do with how the Postal Service would

administer this specification. The Postal Service is looking at methods

to verify the quality of barcodes during verification by using

commercially available barcode verifiers to measure barcode parameters.

Another question concerned the basis for requiring a minimum clear

zone equal to 10 times the average measured narrow element (bar or

space) width on either side of the barcode. The advantage to the Postal

Service for using a minimum clear zone of 10 times the average narrow

element width is to ensure the reliable reading of barcodes on

currently deployed postal equipment. The quiet zone specification for

the barcode symbologies in question is defined in the AIM/USS symbol

specification. Additionally, manufacturers of barcode readers advise

that a minimum clear zone of 10 times the average narrow element width

enhances barcode readability.

This commenter also asked why the \1/8\-inch dimension could not be

used. The reason is that \1/8\ inch is less than 10 times the average

narrow element width for the minimally defined narrow element width of

13 mils, and, therefore, not in compliance with the AIM/USS symbology

specification and the ANSI print code quality guidelines (ANSI X3.182-

1990). Another question from this same commenter concerned whether the

proposed measurement would allow greater room for shifting of the piece

under the barcode reader on the parcel sorter machines. The proposed

clear zone specification is the minimum acceptable standard as provided

in the ANSI print code quality guidelines of ANSI X3.182-1990.

c. Oversized Parcels

The Postal Service had included in the proposed rule provisions for

mailing oversized parcels (parcels exceeding 108 inches but not more

than 130 inches in combined length and girth) at the rates equal to a

70-pound parcel for the applicable zone provided they constituted no

more than 10% of the total pieces in a mailing. Two commenters

questioned the 10% limit. The PRC's recommended decision included zoned

rates for such oversized pieces that are higher than the 70-pound

rates. The PRC did not recommend a 10% limit on such pieces but

recommended higher rates. Since the Governors of the Postal Service

approved this provision of the PRC's recommended decision, the final

DMM standards do not include a 10% limit on such oversized pieces.

d. DSCF Rate Mailings

Nine of the 10 Standard Mail (B) commenters had comments about the

proposed standards for destination sectional center facility (DSCF) and

delivery unit (DDU) rate mailings. Three parcel consolidation shipping

companies submitted comments favoring more flexible, less restrictive

requirements. In general, the comments favored lower minimum volumes

for rate eligibility than those proposed by the Postal Service,

optional entry points, and greater flexibility in the preparation

requirements so mailers could choose to

[[Page 37961]]

prepare pieces directly on pallets, in pallet boxes on pallets, or in

sacks.

One commenter proposed that the Postal Service eliminate the use of

sacks for the DSCF rate. This commenter believed that eliminating sacks

as an option would avoid additional handlings of sacks at postal

facilities. This commenter also indicated that very few parcel mailers

would be able to place 10 parcels in a single sack and that this

minimum could effectively eliminate sacked mail. Five other commenters

also thought the proposed sack minimum of 10 pieces was too high and

said it would discourage DSCF mailings. While several commenters

proposed adopting minimums that would utilize sack volume and weight

factors, these factors are not included as part of the costing

determinations for the rate. The critical cost determinant for the rate

is the number of pieces per handling. In the final DMM standards the

minimum number of pieces per sack has been reduced from 10 to seven.

The decision to reduce the minimum to seven pieces is being made with

the expectation that an average of 10 pieces per sack will be achieved

to support the worksharing discount. In addition, the final DMM

standards allow for one overflow sack per 5-digit destination that may

contain fewer than seven pieces.

Six commenters sought to eliminate the provision prohibiting

overflow pallets. One commenter said that since overflow trays of

letters are permitted, overflow pallets of parcels also should be

allowed. This argument is not persuasive because the cost of handling a

pallet is much greater than the cost of handling a tray. It costs as

much to handle a less-than-full pallet as it does a full one. However,

the standard has been modified in this final rule to accommodate

overflow from pallets. Provisions have been added to the DMM standards

that allow overflow from 5-digit pallets to be placed in 5-digit sacks.

Overflow sacks will have no minimum piece requirement and the pieces in

overflow sacks will be eligible for the DSCF rates. The Postal Service

also has added provisions that will allow a mailer to present to a DSCF

overflow 5-digit pallets (that by definition do not meet the pallet

minimums for the DSCF rate) provided the DBMC rates are paid for the

pieces on such overflow pallets.

Five commenters expressed concern over the 5-digit pallet minimums

specified in the proposed rule. In setting the minimum specified in the

proposed rule, the Postal Service was guided by per-piece handling

costs and concerns that a reduction in the average number of pieces per

handling resulting in higher costs, would adversely affect the

viability of the rate. Small volume pallets would increase handling

costs and also would take more cube space on transportation. While

suggesting differing alternatives to the Postal Service proposal, these

five commenters were in agreement that the requirement of a minimum of

50 pieces and 250 pounds per pallet was too high. To resolve their

concerns and those of the Postal Service about piece handling and

transportation costs, the Postal Service has added a new option for

preparing 5-digit pallets to qualify for the DSCF rate. Under the new

option, pallets may be prepared that contain as few as 35 pieces and

200 pounds of mail provided the total number of pallets prepared for

the DSCF rate in the mailing average at least 50 pieces per pallet.

Under this new option, no other pallet preparation or sack option may

be used within a single mailing. Mailers will be required to submit

detailed documentation and place sequential identification numbers on

qualifying pallets of DSCF rate mail. The documentation must list each

pallet in sequential order by pallet identification number. The listing

must show for each pallet: the pallet identification number, the 5-

digit ZIP Code of the pallet, the total weight of pieces on the pallet,

the total number of pieces on the pallet, and the cumulative total of

pieces (i.e., the number equal to the number of pieces for that pallet

plus the sum of the pieces on all pallets listed above it). This

documentation must not include pieces prepared in overflow sacks at the

DSCF rate, pieces prepared on overflow pallets at the DBMC rates, or

pieces claimed at any other rate in the mailing.

The requirement for BMC entry of DSCF rate mailings prepared on

pallets to ZIP Codes listed in Exhibit E652.5.0 has been retained. The

BMC provides direct transportation to the 5-digit facilities

represented by the listed 5-digit ZIP Codes, thereby allowing certain

quantities of mail to bypass the affected SCFs. The Postal Service

believes that there is a need for palletized mail for the 5-digit ZIP

Codes listed on Exhibit E652.5.0 to continue to bypass the affected

SCFs because of the potentially limited capabilities of those SCF

facilities. Three commenters said that they would like to have an

option to enter DSCF rate mailings either at a BMC or an SCF. To

support this position, one commenter contended that the same dock

procedures for handling 5-digit containers are followed at the SCF as

are followed at the BMC and that the distance from the SCF to a 5-digit

facility would be less than from the BMC. The Postal Service disagrees.

BMCs do not currently sort sacks to 5-digits or cross-dock 5-digit

sacks. They are shipped to the SCF in 3-digit containers and are re-

worked to 5-digits at the SCF, thus adding handlings. Further, granting

an option on a blanket basis is likely to worsen the problems

experienced by some sectional center facilities in accommodating

palletized mailings due to limited dock space, restricted vehicle

maneuvering area, and other constraints. Recognizing that requiring BMC

entry may present certain difficulties for mailers, the Postal Service

has amended the proposed standard to allow exceptions on a case by case

basis. A mailer may submit a written request to the appropriate Area

Manager, Operation Support asking for an exception to Exhibit E652.5.0.

The exception request must be submitted at least 15 days prior to the

mailing and may be granted only for a limited time.

The proposed standard specified that palletized DSCF rate mailings

must be entered at the appropriate BMC listed in Exhibit E652.5.0. and

sacked mailings must be entered at an SCF. Two commenters objected to

these requirements. Since the requirement is consistent with the

costing and worksharing assumptions that underlie the rate, it has been

left unchanged. The rate assumes no handling of sacks at BMCs. Some

mailers who were claiming the DBMC rate will benefit because now they

can get a DSCF rate when dropping at a BMC.

A parcel consolidator also stated that the DSCF rate should be

allowed for mail prepared on pallets for 5-digit facilities that are

not capable of handling pallets according to the Drop Shipment Product.

The requirements as written allow the Postal Service to recoup the cost

savings passed on to the mailer in the lower DSCF rate. These cost

savings will not be realized if the SCF facility receives a 5-digit

pallet for a 5-digit facility that cannot handle pallets. The SCF would

need to manually unload the parcels off of the mailer-prepared 5-digit

pallet and place them into another type of 5-digit container before the

SCF could transport the parcels to that 5-digit facility. Accordingly,

the DMM standards will not be revised to allow the DSCF rate for mail

prepared on pallets for 5-digit facilities that are not capable of

handling pallets.

Six commenters requested reconsideration of the prohibition against

use of pallet boxes on pallets. After further evaluation, the Postal

Service decided to allow the use of

[[Page 37962]]

mailer-supplied pallet boxes that measure up to a maximum of 60 inches

in height, except in the case of facilities unable to handle pallets.

There is no minimum height requirement for the pallet box as long as

the appropriate piece and pound minimum requirement or the 36-inches of

mail minimum requirement are met for each pallet. One commenter also

asked to be allowed to double-stack pallet boxes on pallets. The

proposed standard has been revised to permit double stacking. Just as

pallets are not allowed at the DSCF rate for those 5-digit destinations

listed in the Drop Shipment Product as unable to handle pallets, pallet

boxes on pallets will not be allowed for those same offices.

e. DDU Rate Mailings

The proposed standard did not allow the use of pallet boxes for DDU

rate mailings. Four commenters felt that pallet boxes should be

allowed. The Postal Service agrees that they may be used and that

mailers will need to supply them. If a mailer chooses to do so, they

may be double-stacked. As with DDU mailings that are bedloaded or

sacked or prepared as parcels placed directly on pallets, the vehicle

driver is required to unload the pallet boxes and place them at a

designated location at the delivery unit. If they are double-stacked,

the driver must remove them from the vehicle, unstack them, and then

remove any strapping material. At DDU facilities listed in the Drop

Shipment Product as being unable to handle pallets, mail that has been

placed directly on pallets or in pallet boxes on pallets must be off-

loaded by the vehicle driver from the pallet or pallet box into other

containers specified by the delivery unit.

Two commenters stated that Standard Mail (A) pieces should be

counted towards the minimum volume required for the DDU rate. However,

eligibility for the DDU rate category, as with each of the other

destination rate categories for Parcel Post, has a fixed minimum volume

requirement of 50 pieces of Parcel Post mail. This requirement is in

the Domestic Mail Classification Schedule (DMCS) and cannot be

unilaterally modified by the Postal Service.

One commenter asked whether a separation would be required beyond a

5-digit destination to be eligible for the DDU rate. The Postal Service

requires a 5-digit separation only. However, if more than one 5-digit

ZIP Code is served by a delivery unit, the mailer must separate the

pieces by 5-digit ZIP Code when entered at the DDU.

Another commenter wanted to bedload parcels entered at DDUs.

Mailings may be bedloaded, placed directly on pallets, or placed in

pallet boxes on pallets, if the facility can handle them. Since the DDU

rate is based on worksharing factors that do not include unloading by

Postal Service employees, the requirement for vehicle drivers to unload

all DDU rate mailings is retained.

f. OBMC Presort and BMC Presort Rate Mailings

Three commenters questioned why it is required that machinable

parcels be placed in pallet boxes on pallets and why they could not be

placed directly on pallets. In addition, three commenters wanted to use

pallet boxes for both machinable parcels and nonmachinable parcels. The

proposed standard has been left unchanged. The cost savings underlying

the discount for machinable parcels assumes that machinable parcels are

placed in pallet boxes that can be dumped by tipping the box onto the

parcel sorting equipment instead of having to manually unload

individual pieces from a pallet. A pallet box is placed at an incoming

door of a BMC where there is a dumping operation. Nonmachinable parcels

must be placed directly on pallets because they are worked at separate

locations within a BMC. They are not dumped onto a parcel sorting

machine since they are not machinable. These nonmachinable pieces are

sorted manually. It is safer and more efficient to manually remove such

pieces from pallets when they are placed directly on the pallet rather

than in a pallet box.

One commenter indicated that the proposed documentation for the BMC

Presort and OBMC Presort discounts that requires a listing of the

number of pieces on each individual BMC pallet was too onerous. The

commenter suggested that a listing by BMC destination should satisfy

the needs of the Postal Service. The Postal Service has reconsidered

its documentation needs for verification purposes. Metered mail is

required to bear the exact postage on each piece and, therefore

documentation is not needed to verify postage. Permit imprint mail must

be prepared so that all the mail in a single container is of the same

weight and rate of postage unless the mail is prepared under a manifest

mailing system or another system of documentation or records that

permits the Postal Service to adequately verify postage. The manifest

system will require mailers to list pieces for these rates by BMC

destination. Accordingly, the Postal Service does not believe that any

additional documentation will be necessary for mail entered at the BMC

Presort or OBMC Presort discounts and has removed the documentation

requirement from the DMM standards in this final rule.

One commenter requested that the proposed standards for BMC Presort

and OBMC Presort discounts be changed to allow overflow containers if

the container was at least 50% full. The rate is based on piece

handling efficiencies that are not realized when the containers do not

meet the required minimum volumes. Therefore the prohibition on

overflow containers has been retained.

g. Bedloading

A requirement was included in proposed standard DMM E652.2.1 that

perishable and nonperishable items in a bedloaded DBMC or bedloaded DDU

rate mailing would have to be separated. Fruit shippers in particular

expressed opposition to this on grounds that the current method of

preparing mailings without separation was satisfactory and that the new

requirement would only add to their mail preparation costs. The Postal

Service has removed the requirement from the final standard after

further consideration of the need for separation.

Two commenters also requested to be allowed to bedload DSCF rate

mailings as is allowed for DBMC and DDU rate mailings. The original

provision limiting bedloading to DBMC rate mail entered at BMCs and

ASFs and to DDU rate mail entered at delivery units has been retained

in the final standard. This is because the DSCF rate is based upon

receiving 5-digit containers of parcels that can be cross-docked to the

5-digit delivery unit.

h. Destinating Facility Appointments and Vehicle Unloading

The standard requiring the mailers' drivers to unload destination

delivery unit mailings was the principal area drawing opposing

comments. Six commenters objected to the driver unloading requirement

for the DDU rate. A parcel shippers association and a company commenter

took the position that unloading by drivers should be limited to

bedloaded shipments only. The same two commenters said that postal

employees should unload pallets of Standard Mail (B) parcels just as

they do [Standard Mail (A)] flat mail. The current standards for the

Standard Mail (A) DDU rates do however, require that vehicle drivers

must unload DDU rate mailings. The comments of the parcel shippers

association included a suggestion that assistance by postal

[[Page 37963]]

employees should be provided whenever possible. One commenter

questioned the unloading requirement on the basis that the Postal

Service was unlikely to make forklifts available to drivers and another

raised the possibility that having drivers unload mailings might

violate a postal labor agreement.

Since the worksharing DDU rate assumes that postal employees will

not unload shipments from vehicles, it was necessary for the Postal

Service to retain the proposed standard without amendment. However, to

facilitate the scheduling of drop shipments to delivery units, a

provision has been made to allow standing appointments if shipment

frequency is weekly or more often. Another change was made with respect

to the proposed standard covering deposit conditions (E652.3.7) that

stated mailings arriving more than 1 hour late for scheduled

appointments at delivery units may be refused. This 1-hour allowance

was incorrect. The proposed standard should have indicated 20 minutes

to be consistent with current deposit conditions at delivery units for

Standard Mail (A) mailings. Accordingly, the standard has been modified

to specify 20 minutes.

Several comments were received about destination entry shipments

that generally requested an easing of existing provisions. For example,

one commenter wanted to see the requirement for the time allowed for

driver unloading of destination entry shipments to BMCs, ASFs, and SCFs

increased from 8 to 12 hours. Another company submitting comments

disagreed with the existing 2-hour grace period allowed for scheduled

appointments at BMCs, requesting that the time allowance be doubled or

even expanded to 8 hours during the peak fall mailing season. Such

liberalization of existing standards would adversely impact the window

needed by the Postal Service to handle mailings and will not be

adopted.

Another commenter wanted the Postal Service to allow a drop and

pick option for palletized loads at BMCs. Again, the impact on postal

operations of such a change would be negative, as, for example, postal

employees would then have to shuttle trailers back and forth from

staging areas to facility docks and back. Accordingly, this comment

will not be adopted.

Two commenters maintained that the Postal Service should reimburse

mailers for waiting time charges, demurrage, or other detention costs

when the cause is clearly attributable to the Postal Service or,

alternatively, that there should be an expanded appeal process to the

national Headquarters level. Under existing procedures two appeal

levels, local facility manager and district manager, customer service,

are already available to mailers. While the Postal Service is willing

to consider possible future changes, no changes are made at this time.

i. Markings

Two commenters supported the proposed use of a single drop shipment

marking for DBMC, DSCF, and DDU Parcel Post rate mail. One commenter

disagreed with the requirement for any drop shipment markings. Drop

shipment markings are needed to develop meaningful statistical samples

for the in-office costing system. Costs developed from this system are

used in rate cases. Although individual rate markings for each of the

drop shipment rates would result in more accurate costing, the Postal

Service has determined, based on mailer input, to require only a single

drop shipment marking for use on DBMC, DSCF and DDU Parcel Post rate

mail. An exception will be that the current ``DBMC Parcel Post'' or

``DBMC PP'' marking will continue to be permitted on DBMC rate mail

instead of the new ``Parcel Post'' and ``Drop Ship'' markings until

January 10, 2000.

One commenter indicated that the ``Presorted Standard'' marking

should be extended to Standard Mail (B). This commenter stated that

many mailers now use the ``Bulk Rate'' indicia for both Standard Mail

(A) and bulk Bound Printed Matter mailings by simply adding the ``Bound

Printed Matter'' marking directly to the left of the ``Bulk Rate''

indicia. The Postal Service has amended this final rule to allow use of

the ``Presorted Standard'' marking in lieu of the ``Presorted'' marking

for presorted Bound Printed Matter.

One commenter asked what will happen to an individual customer's

mail if it does not bear the ``Parcel Post'' marking. If this mail is

entered at a retail window, the retail clerk will add the marking to

the mailpiece. If this mail is entered at an acceptance unit, the

appropriate verification and acceptance processes will be performed to

ensure that the mail is entered with proper markings. Since matter

weighing over 16 ounces is not permitted to be placed in collection

boxes, there is little likelihood that mail without the ``Parcel Post''

marking will be entered in the mailstream.

j. Combined Parcels

One commenter stated that Standard Mail (A) parcels should be

permitted to be combined with Standard Mail (B) parcels prepared for

DDU entry because the preparation requirements are identical. The

Postal Service disagrees with this statement. To qualify for Standard

Mail (A) DDU rates, pieces must be sorted to carrier route. Except for

merchandise samples prepared with detached address labels, the maximum

size of Enhanced Carrier Route mail is 11\3/4\ inches high by 14 inches

long, by \3/4\ of an inch thick (which is flat-sized mail). Because of

the maximum size dimensions and the requirement to walk-sequence or

LOT-sequence Enhanced Carrier Route mail, the only parcels that can

qualify for Enhanced Carrier Route rates are merchandise samples

prepared with detached address labels. The separate preparation

requirements for merchandise samples with detached address labels

prepared to qualify for the Enhanced Carrier Route rates does not lend

itself to combined preparation with Standard Mail (B) parcels.

Accordingly, Standard Mail (A) and Standard Mail (B) parcels will not

be permitted to be combined when qualifying for their separate DDU

rates.

One commenter requested that the requirement for minimum volumes to

be met by Standard Mail (B) alone should be removed since the incentive

for combining classes is to use the combined volume to meet the pallet

and sacking minimums. Meeting the pallet and sack minimums based on

Standard Mail (B) alone is required only when the Standard Mail (B)

preparation method requires a minimum number of pieces (e.g., it is not

required when the DSCF minimum of 36 inches of mail on a 5-digit pallet

is used). The Postal Service wants to ensure that it is moving a

substantial volume of mail on a single 5-digit pallet. If mailers fill

a pallet with 36 inches of predominately Standard Mail (A) mail, it

would take a large number of Standard Mail (A) pieces to do so. By the

same token, placing predominately Standard Mail (A) parcels on a pallet

based on a 50-piece minimum criteria could result in a very small

pallet. Therefore the Postal Service is retaining the rules as

proposed.

7. Special Services

a. Business Reply Mail

Eleven comments were received concerning the proposal to increase

the minimum thickness of BRM pieces from 0.007 inch to 0.009 inch thick

for those pieces that bear a barcode and measure greater than 4\1/4\ by

6 inches. Nine commenters stated that 0.009 inch thick paper stock is

more expensive than 0.007 inch thick paper stock. Six

[[Page 37964]]

commenters indicated that the increased weight of the stock would

increase shipping and trucking costs of the paper stock and increase

pound-rate postage on the outgoing mailpiece (publication) that the BRM

piece is inserted into. Four commenters suggested that mailers will

cease using the cards and use some other medium than the mail to

increase their circulation and market their products. One commenter

stated that this change is not directly related to rate and fee

increases in Docket No. R97-1. One commenter suggested the Postal

Service develop a new maximum size limit that could be used with 0.007

inch thick paper stock, such as 5 inches by 7 inches. Four commenters

stated that the Postal Service should study the impact on mailers and

the Postal Service before adopting this requirement. Three commenters

indicated that no compelling rationale for this change was provided in

the proposal, such as the existence of machinability problems. Nine

commenters indicated that there is currently only a limited supply of

0.009 inch card stock. Two commenters indicated that mailers would need

a grace period before this requirement went into effect so that their

printers could develop new paper supplies. One commenter indicated that

Postal Service testimony in R97-1 indicated that only a small

proportion of BRM is processed through BRMAS or through barcode sorters

and that the additional expense of thicker paper stock is not warranted

if the pieces are not likely to be handled in an automated fashion.

A low incidence of processing mail on barcode sorters is true only

for the accounting activities related to BRM. However, the lower First-

Class postage rate for QBRM is based on lower costs due to processing

pieces on barcode sorters in non-accounting operations (i. e. in

processing the mail from the collection box to the facility where the

accounting procedures are performed).

The Postal Service has adopted the minimum thickness requirement of

0.009 inch for pieces measuring over 4\1/4\ in height and/or 6 inches

in length as proposed. This requirement is based on engineering

studies. These studies have shown that mailable pieces not larger than

4\1/4\ by 6 inches with a minimum thickness of 0.007 inch and meeting

specified basis weight requirements can be successfully processed on

automation equipment, while pieces larger than 4\1/4\ by 6 inches

generally must be 0.009 inch thick to be successfully processed on

automation equipment. Adoption of this rule will ensure that business

reply pieces entered at the automation QBRM rate or that otherwise bear

a barcode will be sufficiently sturdy to be successfully transported

through postal automation equipment and will minimize the potential for

damaged pieces. The Postal Service implemented this minimum thickness

requirement for automation rate mailings on February 24, 1991, based on

these studies and on mailer complaints concerning damaged pieces.

Although at that time these minimum thickness requirements were not

applied to BRMAS or other barcoded BRM pieces, the Postal Service

believed then and believes today that the 0.009 inch minimum thickness

requirement for pieces measuring over 4\1/4\ by 6 inches is necessary

for efficient processing on automation equipment. In view of the

discounted First-Class postage rate applied to QBRM postage that is

based primarily on the savings for automated processing, the Postal

Service feels it is appropriate to apply the same standards to this

mail as it does to other mail entered at automation rates. The Postal

Service understands that mailers may need time to deplete existing

stock of BRM mailpieces and to develop suppliers of thicker paper

stock. Therefore, the effective date of the 0.009 inch minimum

thickness requirement for barcoded BRM pieces measuring over 4\1/4\ by

6 inches will be January 10, 2001. This gives mailers 2-\1/2\ years

notice to comply with this change.

Only one comment was received regarding barcode placement. This

commenter indicated that the proposed change to DMM S922.5.1 was

confusing. This commenter assumed that the Postal Service was not

seeking to further restrict placement of barcodes on letter-size BRM

and asked why the one-year grace period for compliance was needed. The

proposed change was to make the placement of lower right barcodes for

BRM comply with C840. Currently, pieces of BRM prebarcode in the lower

right corner may: (1) have a barcode clear zone with a left boundary

that is 4\1/2\ inches from the right edge of the piece (not 4\3/4\

inches as required in C840); (2) have a lower right barcode for which

the leftmost bar is located between 3\1/4\ and 4 inches from the right

edge of the piece (not between 3\1/2\ and 4\1/4\ inches as required

under C840); (3) have a lower right barcode window, that has a left

boundary measuring 4\1/2\ inches from the right edge of the piece (not

4\3/4\ inches as required under C840). The final standards in DMM

S922.5.1 have been revised to clarify this matter. Mailers will be

given until January 10, 2001, to use existing stocks of such

prebarcoded BRM envelopes and cards and to procure new stock that meets

the DMM C840 requirements.

One comment was received questioning why proposed S922.6.8c(4)

prohibits the use of business reply labels on letter-size envelopes

with a height more than 4\1/2\ inches. This is not a change. The same

standard appears today in S922.6.10c(4). This standard will be

maintained in order to assure the readability of the address on the

letter-size piece. If labels were permitted on letter-size pieces up to

the maximum height of 6\1/8\ inches, the address on the label would not

be placed within the optical character read (OCR) area of the

mailpiece.

One comment was received regarding the format error notification

process described in proposed DMM S922.5.3. The commenter stated that

although mailers are willing to correct errors immediately, they need a

grace period in which pieces already distributed will be returned. The

cited DMM section only requires that all future BRM pieces distributed

by any means must meet the BRM format standards. This commenter also

indicated that the requirement for mailers who have had their BRM

permit revoked for repeatedly distributing BRM mail that does not meet

the format requirements to submit 2 samples of each BRM format for

approval for a two-year period after completing a new BRM application

is overly punitive. The commenter stated publishers receive inserts too

close to printing dates to allow time for the Postal Service to review

the format. The commenter should note that this provision is not a

change. The same standard appears today in S922.5.7 and has been in

place for several years. The Postal Service feels that no change in

policy is warranted at this time. This provision only applies to permit

holders whose permit was previously revoked for repeated format

violations and should not affect the vast majority of mailers.

b. Insurance

One commenter requested clarification of DMM S913.12b. He indicated

it is not clear what level of service would be provided to an item

mailed under this DMM section. This section in essence states that

matter mailed at First-Class Mail or Priority Mail rates may be insured

only if it consists of matter that could also be mailed at Standard

Mail rates (that is, it is not any of the types of items required to be

mailed at First-Class rates under DMM E110). The level of service

provided for these items will be First-Class or Priority Mail service

according to the weight of the item and the rate of postage paid.

[[Page 37965]]

c. Return Receipt Service

Three commenters had concerns over the Postal Service's proposal to

modify DMM D042.1.7a and b. The proposed revisions stipulated that

organizations receiving large volumes of pieces bearing return receipts

would only need to sign a manifest listing all of the accountable mail

before the mail was delivered to the organization. The current DMM

rules stipulate that the recipient sign the delivery receipt and the

return receipt and hand the receipts over to the Postal Service before

the mailpieces can be opened, or given to the recipient. These

commenters were concerned that allowing customers to complete return

receipts without Postal Service controls is inappropriate and does not

guarantee the customer that the return receipt he or she has paid for

will be returned or will be completed properly. The Postal Service

proposed this revision to reflect the operational conditions in plants

that employ automated delivery receipt systems for processing

accountable mail. However, based on the mailer comments received, the

Postal Service determined not to revise DMM D042.1.7a and b. The Postal

Service will work with its customers that receive large volumes of

return receipts to ensure that our customers get the recipient's

signature, date of delivery, and address, if different, under the

standards in the current DMM.

e. Requests for Use of Various Special Services With Standard Mail (A)

Two commenters recommended that DMM E612.4.10 be revised to allow

COD, insurance, and registry service with Presorted Standard Mail (A).

Another commenter indicated that certified, COD, insurance, registered,

return receipt, return receipt for merchandise, special handling, and

delivery confirmation services should be available for Standard Mail

(A) since these services are available today for merchandise and

providing these services would generate revenue. DMM E612.4.10 contains

the information in current DMM E612.4.1. This section states that bulk

rate Standard Mail (A) may not use certified, collect on delivery,

insurance, registry, return receipt for merchandise, and special

handling services. The proposed DMM language simply moved this

information into a separate section so that it is easier to find.

Although a few of the above services were previously available for

Standard Mail (A) matter mailed at the single-piece rates, the

elimination of the single-piece Standard Mail (A) rates now excludes

any Standard Mail (A) from receiving these services. Offering these

services with Standard Mail (A) would in many instances require a

classification case to be filed with the PRC. Therefore, such changes

will not be implemented with these R97-1 implementation rules. However,

the Postal Service may consider offering some of these services with

Standard Mail (A) at a future date.

D. Summary of Domestic Mail Manual (DMM) Changes

The following are changes organized by DMM module. They are

intended as an overview only and should not be viewed by readers as

defining every revision.

A Addressing

A060.5.3 is amended to eliminate the option to pay postage for

excess or undeliverable detached address labels (DALs) or items being

returned at the single-piece Standard Mail (A) rates. Postage for

excess or undeliverable DALs or items being returned is computed at the

applicable single-piece rate (First-Class Mail, Priority Mail, or

Standard Mail (B)) for the combined weight of the DAL and the

accompanying item, regardless of whether both are being returned.

C Characteristics and Content

References to single-piece Standard Mail (A) are deleted

throughout. C050 is revised to add ``Nonmachinable'' to the title of

5.0 and 6.0 (Irregular and Outside Parcels). C100.4.0 is revised to

include keys and identification devices as items that may be considered

nonstandard mail. C600.1.2 is amended to allow Parcel Post mailings to

include pieces measuring over 108 inches, but not over 130 inches, in

combined length and girth, if the oversized Parcel Post rate is paid.

C600.1.2 also is amended to require Parcel Post pieces that weigh less

than 15 pounds but measure more than 84 inches in combined length and

girth to pay a rate equal to that of a 15-pound parcel for the zone to

which the parcel is addressed. C600.2 is amended to delete the

nonstandard surcharge criteria that formerly applied to single-piece

Standard Mail (A). C810.2 is amended to provide new maximum weights for

automation ``heavy'' letters. C820.2 is amended to increase the maximum

weight limit for First-Class automation rate flats to 13 ounces. C840.8

is amended to add a stipulation for ZIP+4 barcodes for QBRM and other

barcoded BRM. A new C850 is added to provide standards for barcodes on

parcels.

D Deposit, Collection, and Delivery

D010.1.1 is amended to delete the term ``single-piece.'' D010.1.2

is amended to exclude Parcel Post pieces mailed at the DDU and DSCF

rates (as well as mail at DBMC rates), or claiming the OBMC Presort

discount, from obtaining pickup service. D600.2 is amended to remove

the sentence that allowed single-piece Standard Mail (A) bearing

adhesive stamps to be placed in collection boxes.

E Eligibility

E060.5 is amended to reflect the new 13-ounce weight limit for

First-Class Mail. E060.12 is amended to remove single-piece Standard

Mail (A) as a permissible rate for the return of items under penalty

merchandise return service. E110.4 is revised to delete references to

Presorted Priority Mail. E120 is revised to remove references to

Presorted Priority Mail, to add information on rates and fees

applicable to keys and identification devices, and to make minor

organizational changes. E130 is revised for clarity and to add

information on rates and fees applicable to keys and identification

devices. E150 is added to provide information on qualified business

reply mail. E200.14 is amended to reflect the elimination of single-

piece Standard Mail (A) rates. E230.1, and E230.3 through E230.5 is

revised to provide for separate 5-digit and 3-digit rates for Regular,

Nonprofit, Classroom, and In-County subclasses, and to show that the

applicable 3-digit rates will apply to both unique and nonunique 3-

digit ZIP Code areas. E230.6 is revised to allow In-County mail to

qualify for high density carrier walk-sequence rates based on either a

minimum of 125 pieces per route or 25% of the total active possible

deliveries on the carrier route. E230.7 is amended to require

documentation for pieces and copies mailed to all 3-digit destinations,

(not only unique 3-digit destinations). E240.2 is amended to is revised

to provide for separate 5-digit and 3-digit rates for Regular,

Nonprofit, Classroom, and In-County subclasses, and to show that the

applicable 3-digit rates will apply to both unique and nonunique 3-

digit ZIP Code areas. E600 is revised throughout to delete references

to single-piece Standard Mail (A) and to change the name

``nonautomation presort'' to ``Presorted'' or ``Presorted Standard.''

E612 is revised to change the weight breakpoints for the Standard Mail

(A) minimum per-piece rates, require Standard Mail (A) mailed at a

Standard Mail (B) rate to show the applicable Standard Mail (B)

marking, and to move restrictions on use of

[[Page 37966]]

special services from E612.4.1 to new section E612.4.10. E620 and E630

are reorganized so that E620 contains standards for Standard Mail (A)

and E630 contains standards for Standard Mail (B). E620 is revised to

add new minimum volume requirements for Presorted Standard mailings, to

add provisions for mailing certain matter not eligible for Standard

Mail (A) rates that bears Standard Mail (A) markings at the single-

piece First-Class or Priority Mail rates, and to add provisions for the

new residual shape surcharge. E630 is revised to add provisions for new

DSCF and DDU rates and new OBMC Presort, BMC Presort discounts, the

oversized parcel provisions, and balloon rate provisions. E630 is

revised to add provisions for a barcoded discount for Standard Mail (B)

rates. E630 is revised to change marking requirements for Standard Mail

(B). E640 is amended to clarify that Nonprofit rate mail may qualify

for automation rates. E652 is revised to add provisions for DSCF and

DDU Parcel Post rates.

F Forwarding and Related Services

F010 is amended throughout to delete references to single-piece

Standard Mail (A). F010 is amended to revise forwarding and related

services for Periodicals and for Standard Mail (A) to show that return

postage is subject to the First-Class or Priority Mail rates based on

weight, except for machinable Standard Mail (A) parcels returned under

Bulk Parcel Return Service (BPRS). F020 is revised to remove references

to single-piece Standard Mail (A).

G General Information

G043 is revised to add names and addresses of organizations from

whom barcode specifications and barcode grading requirements can be

obtained.

L Labeling Lists

Section L100, including labeling list L102, ADCs--Presorted

Priority Mail, is deleted. New labeling list L605, BMCs--Nonmachinable

Parcel Post, is added.

M Mail Preparation and Sortation

M011.1 is revised to add the definition of an overflow sack for

Parcel Post DSCF rate mailings. M011.1 is revised to amend the

definition of a mailing. M012 is revised to change marking requirements

for Standard Mail (A) and (B), to clarify that no marking is needed for

single-piece First-Class Mail, and to specify time frames for the new

marking requirements. In M032, Exhibit 1.3 is revised to show headings

for new Periodicals rate levels and for new Parcel Post rates and to

change the name ``bulk Bound Printed Matter'' to ``presorted Bound

Printed Matter.'' M033.1 is revised to reflect the new 13-ounce weight

limit for First-Class Mail. M041 is revised to reflect requirements for

new Standard Mail (B) rates (OBMC Presort, BMC presort, DSCF, DDU).

M045 is revised to add preparation requirements for new Standard Mail

(B) rates (OBMC Presort, BMC presort, DSCF, DDU). M050.4 is amended to

reflect revised placement of sequencing date information on mailing

statements and to add documentation requirements for the Periodicals

In-County rate mail that qualifies for high density rates under the new

25% of the total active possible deliveries per carrier route criteria.

M072.1.1 is amended for clarity. M072.2.5 is amended to delete

references to ``Bulk Parcel Post,'' revise ``bulk Bound Printed

Matter'' to ``presorted Bound Printed Matter,'' add an exception to the

zone separation requirement, and to add information on preparation of

drop shipment mail for Parcel Post DSCF and DDU rates. M073 is revised

to add information about permissibility and preparation requirements

for combining Standard Mail (A) and Standard Mail (B) parcels in

mailings qualifying for new Parcel Post rates (OBMC Presort, BMC

Presort, DSCF, and DDU). M120 is revised to delete the sections on

Presorted Priority Mail. M200 is revised to require preparation of an

SCF level of sack. M130.2 and M130.3 are amended to revise their

titles. M130.5 is revised to reflect the new 13-ounce weight limit for

First-Class Mail. M200.3 is revised to require preparation of an SCF

sack for nonletters, to delete the provisions for an optional origin/

required entry 3-digit sack, and to add provisions for an optional

origin/required entry SCF sack. M620 is revised to change

``nonautomation presort'' to ``Presorted,'' to revise references to

E620 and E630, and to revise rate marking requirements including time

frames for changing the ``Bulk Rate'' marking to ``Presorted

Standard.'' M630 is amended to add preparation requirements for DSCF

and DDU rates; to change ``nonautomation presort'' to ``Presorted;'' to

revise references to E620 and E630; and to revise rate marking

requirements for all Standard Mail (B) including placement of subclass

markings, new generic rate markings for drop shipment rates, revising

``bulk Bound Printed Matter'' to ``presorted Bound Printed Matter,

eliminating the ``Bulk Parcel Post'' marking, removing the requirement

for a 5-digit or 3-digit ZIP Code in the rate marking for DBMC rates,

eliminating the ``catalog rate'' marking for Bound Printed Matter, and

adding the abbreviation ``PRSRT'' for ``Presorted'' in the ``Presorted

Special Standard'' marking. M810 is reorganized and revised for clarity

and to add new rate categories for Periodicals and to make the 5-digit/

scheme sortation level optional for Periodicals automation letters.

M820 is revised to make the SCF sack a required level of presort for

Periodicals automation flats, to delete the provisions for an optional

origin/required entry 3-digit sack, and to add provisions for an

optional origin/required entry SCF sack.

P Postage and Payment Methods

P011 is revised to delete references to single-piece Standard Mail

(A). P012 revises standardized documentation for Periodicals to add

separate 5-digit and 3-digit rates for both automation and

nonautomation and to add new rate abbreviations for nonautomation 5-

digit and 3-digit rates. P013 is revised to reflect payment for keys

and identification devices at First-Class Mail and Priority Mail rates

plus a $0.30 fee instead of single-piece Standard Mail (A) rates, to

delete sections concerning computation of single-piece Standard Mail

(A) rates, to revise the breakpoints for Standard Mail (A) rates, to

delete references to Bulk Parcel Post, and to revise the term ``bulk

Bound Printed Matter'' to ``presorted Bound Printed Matter.'' P014.2 is

revised to delete references to single-piece Standard Mail (A).

P030.1.5 is revised to reflect the new 13-ounce weight limit for First-

Class Mail. P030.5.4 is revised to delete a reference to single-piece

Standard Mail (A). P040.4.1 is revised to reflect the new rate marking

requirements for First-Class and Standard Mail and delete examples for

single-piece Standard Mail (A). P100 is revised to add payment

provisions for mailing certain matter not eligible for Standard Mail

(A) rates that bears Standard Mail (A) markings at the single-piece

First-Class or Priority Mail rates. P600 is revised to establish

postage payment methods for Standard Mail (B) containing a combination

of discounts, to delete information on payment and use of ``SNGLP''

marking for single-piece Standard Mail (A), and to clarify that for

mailings of identical weight, Standard Mail (A) postage may be affixed

to all pieces in the mailing at the lowest rate in the mailing job.

P710 is revised to reflect the new marking requirements for regular

rate Standard Mail (A). P750 is revised to include instructions on the

new Parcel Post DSCF and DDU rates. P760 is revised to change

``nonautomation'' to ``Presorted'' for Standard Mail (A) and to delete

[[Page 37967]]

references to single-piece Standard Mail (A).

R Rates and Fees

The entire module is revised to reflect new rates and fees.

S Special Services

S010 is revised to add information on claims for the new bulk

insurance service. S070 is revised to clarify applicability of Priority

Mail Drop Shipment. S911 is revised to reflect changes to indemnity

coverage for registered mail. S913 is revised to eliminate references

to single-piece Standard Mail (A), to provide clarification to matter

eligible for insurance, and to include rules for the new bulk insurance

service. S915.1 and S915.2 are amended for clarity. S917 is amended to

delete availability of return receipt for merchandise with single-piece

Standard Mail (A). S921 is amended to delete availability of COD with

single-piece Standard Mail (A). S922 is revised to change references

from BRMAS to QBRM, to remove eligibility requirements for BRMAS (these

are relocated under QBRM in E150), to require all BRM bearing barcodes

to meet the requirements of C810 and C840 (except basis weight

requirements for envelopes in C810.7.1), and to replace current BRM

standards relative to reflectance requirements, paper weight, and self-

mailers with current mailpiece design requirements in C810 and C830

(except basis weight requirements for envelopes in C810.7.1, and the

retention and clarification of current prohibition of red fluorescence

in excess of 4.0 phosphor meter units). S923 is revised to eliminate

the return of merchandise return service pieces at single-piece

Standard Mail (A) rates, to prescribe new rates of return and

corresponding markings, and to reflect new standards concerning

registered mail used with that service. S924 is revised to eliminate

references to single-piece Standard Mail (A). S930 is amended to remove

availability of special handling service for single-piece Standard Mail

(A), and to correct the rules to allow First-Class Mail and Priority

Mail to receive special handling.

List of Subjects in 39 CFR Part 111

Postal Service.

For the reasons discussed above, the Postal Service hereby adopts

the following amendments to the Domestic Mail Manual, which is

incorporated by reference in the Code of Federal Regulations (see 39

CFR Part 111).

PART 111--[AMENDED]

1. The authority citation for 39 CFR part 111 continues to read as

follows:

Authority: 5 U.S.C. 552(a); 39 U.S.C. 101, 401, 403, 404, 3001-

3011, 3201-3219, 3403-3406, 3621, 5001.

2. Revise the following sections of the Domestic Mail Manual as

follows:

A Addressing

A000 Basic Addressing

* * * * *

A060 Detached Address Labels (DALs)

* * * * *

5.0 POSTAGE

* * * * *

5.3 Returns

[Amend the first sentence of 5.3 by replacing ``Standard Mail'' with

``First-Class Mail'' to read as follows:]

Postage for excess or undeliverable DALs that are properly endorsed

or for items being returned is computed at the applicable single-piece

rate (First-Class Mail, Priority Mail, or Standard Mail (B)) applicable

to the combined weight of the DAL and the accompanying item, regardless

of whether both are being returned. * * *

* * * * *

C Characteristics and Content

C000 General Information

C010 General Mailability Standards

1.0 MINIMUM AND MAXIMUM DIMENSIONS

* * * * *

1.6 Nonstandard Surcharge

[Amend 1.6 by removing ``or C600, respectively,'' and ``or Single-Piece

Standard Mail'' to read as follows:]

Because of address placement (orientation) under C100, a mailable

piece of First-Class Mail weighing 1 ounce or less can be subject to

the corresponding nonstandard surcharge.

* * * * *

C022 Perishables

* * * * *

3.0 LIVE ANIMALS

3.1 Day-Old Poultry

[Amend 3. 1f by adding ``or Priority Mail'' for clarity as follows:]

Day-old poultry vaccinated with Newcastle disease (live virus) is

nonmailable. Live day-old chickens, ducks, geese, partridges, pheasants

(mailable only from April through August), guinea fowl, quail, and

turkeys are acceptable in the mail only if:

* * * * *

f. The shipment bears special handling postage in addition to

regular postage, unless sent at the First-Class Mail or Priority Mail

rate.

* * * * *

C024 Other Restricted or Nonmailable Matter

* * * * *

18.0 ODD-SHAPED ITEMS IN ENVELOPES

18.1 Nonmailable

[Amend 18.1 by removing ``Standard Mail (A) rate'' to read as follows:]

Pens, bottle caps, and similar odd-shaped items are not acceptable

in letter-size envelopes at the single-piece First-Class Mail rate.

* * * * *

C050 Mail Processing Categories

* * * * *

[Amend 5.0 to add ``Nonmachinable'' to the title as follows:]

5.0 IRREGULAR PARCEL (NONMACHINABLE)

* * * * *

[Amend 6.0 to add ``Nonmachinable'' to the title as follows:]

6.0 OUTSIDE PARCEL (NONMACHINABLE)

* * * * *

C100 First-Class Mail

1.0 DIMENSIONS

1.1 Maximum Weight and Size

[Revise 1.1 to show the new maximum weight of 13 ounces to read as

follows:]

Each piece may not weigh more than 70 pounds. Matter at First-Class

Mail rates may not exceed 13 ounces. The combined length and girth of a

piece (i.e., the length of its longest side plus the distance around

its thickest part) may not exceed 108 inches. (Lower size or weight

standards apply to mail claimed at certain rates or addressed to

certain APOs and FPOs.)

* * * * *

4.0 NONSTANDARD MAIL

[Revise 4.0 to include keys and identification devices as items subject

to the nonstandard classification as follows:]

Except for Priority Mail, any piece of First-Class Mail (including

keys or identification devices) weighing 1 ounce or less and not

claimed at a card rate is nonstandard and subject to the applicable

surcharge if its thickness

[[Page 37968]]

exceeds \1/4\ inch or, if based on the placement (orientation) of the

address, its length exceeds 11\1/2\ inches, its height exceeds 6\1/8\

inches, or its aspect ratio (length divided by height) is less than 1.3

or more than 2.5.

* * * * *

C600 Standard Mail

1.0 DIMENSIONS

1.1 Standard Mail (A)

[Amend 1.1b to read as follows:]

These dimensional standards apply to Standard Mail (A):

* * * * *

b. Presorted (\3/5\ and basic rate) Regular and Nonprofit Standard

Mail (A) are subject only to the basic mailability standards in C010.

* * * * *

1.2 Standard Mail (B)

[Amend and renumber 1.2 as follows to specify requirements for

oversized Parcel Post and add a Parcel Pos

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