Review plays pivotal role in ensuring USPS delivers newspapers on time
Review plays pivotal role in ensuring USPS delivers newspapers on time
by Max Heath
National Newspaper Association Postal Chair
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It took the disruption of service to some newspaper readers in Wisconsin, a lot of heartburn and sustained diplomacy by the National Newspaper Association for the past seven months. But NNA now has an agreement in principle to exempt newspapers mailing under 5,000 copies weekly from the trials and delays of so-called Performance Based Verification (PBV).
The policy is expected to be released this month (November) after months of work with Business Mail Acceptance (BMA) Manager Bob Galaher in Postal Service headquarters.
Postal Service finance personnel insisted on keeping the eligibility for the exemption at a relatively low level. In addition to the weekly cap, there will be an annual cap of 300,000 pieces. NNA had held out for a higher annual cap on total pieces mailed, but finally acknowledged that further improvement was unlikely in light of USPS finances and the focus being placed on so-called “revenue protection” during this severe recession.
The exemption will help most newspapers, but some newspapers of greater than weekly frequency may run up against the annual ceiling. NNA did secure a promise that papers outside the new policy would be considered for PBV exemption on a case-by-case basis. NNA expects these exceptions will be given if mailing records are clean and qualifying software is used. We have also been told that postal field offices would be instructed not to hold up distribution of newspaper mail under any circumstances.
First, some definitions and background:
SOX: The Sarbanes-Oxley Act (commonly referred to as SOX) subjects the Postal Service to a higher level of financial accounting standards, identical to public companies, as part of the postal reform act of 2006. While NNA thinks SOX is sometimes being “over-interpreted” by postal officials, SOX nevertheless has led to enforcement of rules that newspapers had never experienced much prior to last year. This includes the requirement to have postage statements submitted at the exact time with the mailing, and closer review of mail makeup and quantities to verify that proper postage is paid.
PBV: Performance Based Verification is a sampling technique designed to subject mailings to closer inspection for accurate presort and other compliance elements over an initial period of multiple issues. Then if no defects are found, PBV goes to random full inspections only when clerks are instructed to do so in the PostalOne! accounting system used to process postage statements. PBV can force mailings to be held up for unacceptably long periods under normal deadlines for the review to occur, which could result in delaying the mail for a full day. The enforcement of PBV has threatened a number of NNA members in the past year.
A “cursory review” is still required on other mailings. That includes reviewing the marked copy and noting the ad percentage, checking the piece weight, ensuring enough money is in the deposit account to cover the cost, and review required supporting documentation.
SOX drives both issues. In recent years, audits of local post offices have shown that money may have been left on the table by allowing mail to go into the system without proper verification of preparation and payment. But there is no direct evidence that newspapers have caused these problems.
NNA had previously worked out overnight-drop policies so that newspapers dropped when offices are closed, or late day, could have until the morning of the next business day to submit postage statements. All SOX issues prior to the PBV project had been resolved in a manner workable to newspapers without disrupting deadlines, thanks to customer-friendly intervention of Galaher’s staff.
But rigid enforcement of PBV this past year caused postal personnel, under threat to improve SOX scores or else, to try to push newspaper deadlines back unacceptably for many NNA members, say from 4:30 p.m. mail entry to 2 p.m. In most cases NNA had been able to negotiate slight shifts on the part of newspapers while dialing back more aggressive demands by local post offices. But in some situations, there was just no wiggle room for a mailer to move its paper earlier, due to press schedules or other news/advertising deadline necessities.
An extreme example of the problems created by a combination of policy crackdown and inflexible local postal personnel arose in Plymouth, Wis., where Barry and Christie Johanson and son Ian publish several newspapers and run a sizable printing operation. While some of their titles met the desired earlier window, one did not, and could not. After the mail was held up a day by the postmaster, NNA argued for alleviation of PBV enforcement for this and similar titles.
But playing the undesired role of “crash-test dummy” by the Johansons so NNA could hold up their situation as evidence of inattention to customer needs gave all parties a chance for fruitful discussions. NNA first met with Galaher during the NNA Government Affairs Conference last March, seeking to find common ground for an exemption that minimized the dollars at risk for our members, who mostly pay lower-price in-county mail.
After months of deliberations, USPS agreed that some relief for newspapers was warranted, and that NNA members presented low risk of postage loss. NNA sought a wide exemption, but in the end agreed to move forward with success for most weekly papers, and work to modify the exemption upward in the future.
The PBV Periodicals newspaper exemption appears to be ending up under these terms:
A newspaper mailer may enter mail into the mailstream without prior PBV if these conditions are met:
—Mail fewer than 5,000 copies per postage statement
—Mail fewer than 300,000 copies annually
—Are primarily for in-county distribution within the local area of the “known office of publication” including Exceptional Dispatch copies
—Are deposited at the office where the publication account is maintained or at a designated local delivery facility as identified by the postmaster of the original entry office
—Mail at frequency of weekly or more frequent
—Are deposited after hours or late day in order to make scheduled transportation outside the “known office”
The draft policy also states that despite the waiver of PBV, “acceptance offices should always attempt to perform as much verification as possible without disrupting the established service expectations of the publisher.” It also clarifies that the new policy would “not provide any exceptions for the annual verifications all Periodicals mailings are required to have.” (These are usually performed in October to verify information reported on the Statement of Ownership, PS Form 3526.)
Mailers are also encouraged (but not required) to use the PostalOne! electronic postage statement filing system.
And how, you might ask, are the Johansons doing?
Well, not so hot. The Plymouth, Wis., post office continues to use the publishers as unwilling “crash test dummies.” Since the postmaster was instructed to pilot the PBV exemption there, the publishers have been subjected to a string of indignities:
In June a $188.54 mailing for 1,898 pieces was upcharged $158.29 for about 165 pieces allegedly miss-sorted. The publishers were not given an opportunity to “fix” the mailing prior to dispatch, and were charged single-piece First-Class prices. After an appeal by NNA on the publishers’ behalf arguing that the upcharge on PS Form 2866 at First-Class rates was without authority and illegal, the money was eventually refunded.
In October another title they owned was denied Monday holiday drop privileges. When drivers attempted to drop Tuesday morning at 6:30 a.m. to get delivery on the normal day, the drop was refused. Two newspaper delivery drivers were ordered to leave the property immediately, or the police would be called. Appeals to regional supervisors led to the newspaper being accepted at noon, with one-day delays to some subscribers. The postmaster later agreed to return to Monday drop privileges for future postal holidays.
The Johansons told their readers in a cover story, “This disruption is part of a documented pattern of rejected deliveries and overcharges in Plymouth which pose a severe threat to our business in a very difficult period for newspapers.”
We thank the Johansons for enduring, and helping to get the new PBV small-newspaper exemption in place that will help other publishers across the country. Stay tuned to this space for further developments. Meanwhile, the Postal Service continues to complain about falling mail volume. Wonder why?
Max Heath, NNA postal chair, is a postal consultant for Publishing Group of America and Landmark Community Newspapers, LLC. E-mail mailto:maxheath@lcni.com
