DMM TOC > 700 Special Standards|
709 Experimental and Temporary Classifications
1.1.1 Definition and Purpose
A negotiated service agreement (NSA) is a customized and mutually beneficial contractual agreement between the USPS and a specific mailer (customer or organization). An NSA provides for customized pricing, prices, and classifications under the terms and conditions established in the NSA and may include modifications to current mailing standards and other postal requirements. Any mailer may submit an application for an NSA if the mailer meets the requirements in 1.2 and follows the process in 1.3.
1.1.2 Legal Framework
Terms and conditions of an NSA affecting prices or classifications require that the USPS request a recommended decision from the Postal Regulatory Commission before the USPS may approve and implement the NSA. NSAs must be recommended and approved under 39 U.S.C. 36 and the Postal Regulatory Commission’s rules of practice and procedure.
a. Candidate’s presentation of information as requested by the USPS to document the following:
1. Current mailing systems, postage payment systems, and quality control procedures and programs.
2. Historical data showing mail volumes and use of specific mail services or mailpiece characteristics, as applicable. The candidate, as necessary, must also provide the effect on mail volumes of any corporate mergers, acquisitions, divestitures, and similar events.
b. Candidate’s ability to make and present in an acceptable format accurate forecasts of future mail volumes for USPS products and services proposed for an NSA.
d. Candidate’s willingness to establish and maintain electronic systems and quality control programs as specified by the USPS for paying postage and generating records to facilitate monitoring and reconciling mail volumes, prices, and fees, including volumes and postage paid by a mail preparation agent on behalf of the candidate.
e. Candidate’s production of mail using a formal system to ensure proper mail preparation and accurate postage calculations.
f. Candidate’s use or planned implementation of a Certified Mail preparation total quality program to ensure proper mail preparation and to provide accurate documentation of mailings and postage payment.
1.2.2 General Requirements
No proposed NSA may have an overall negative financial impact on the USPS. Any proposed NSA must also contain, at a minimum, the following general candidate requirements and conditions:
b. The candidate must prepare mail under current applicable mailing standards, unless they are to be modified under a proposed NSA.
c. The candidate must meet and adhere to quality management standards for the classes of mail and prices claimed.
d. The candidate must make available to the USPS necessary records and data related to the NSA in a form that facilitates monitoring of compliance with the terms and conditions of the NSA.
f. The USPS has the right to cancel the NSA at any time with specified proper notice for any failure or, where appropriate, material failure of the mailer to:
2. Provide accurate data, present properly prepared and paid mailings, or comply with any other material term or condition in the NSA.
g. The candidate must engage counsel and file testimony as necessary in support of the NSA before the Postal Regulatory Commission.
1.3.1 Initial Proposal
A mailer seeking to enter into an NSA with the USPS must submit a written proposal, with appropriate supporting documentation, to the USPS manager of Pricing Strategy (see 608.8.0 for address). The proposal must contain the reasons for requesting the NSA along with a summary of the information responding to the applicable candidate features and general requirements described in 1.2. A nondisclosure agreement must be signed before any substantive discussion of the proposal.
As a result of the proposal, the candidate and the USPS may enter into negotiations to establish an NSA, with terms and conditions specific to the candidate, that is either a functionally equivalent NSA (i.e., comparable to an existing baseline NSA) or a new baseline NSA (i.e., not comparable to an existing NSA). A candidate in the negotiation process may withdraw a proposal for an NSA at any time prior to the execution of the NSA. Once the NSA is executed, the NSA is controlled by its terms and conditions.
1.3.3 Additional Consideration
If the USPS decides to end negotiations with the candidate before reaching an agreement to enter into an NSA under 1.1, the manager of Pricing Strategy notifies the candidate in writing and gives the reasons for the decision. Within 15 days from the receipt of the written explanation, the candidate may ask for reconsideration of the manager’s decision. The candidate’s request for reconsideration must include additional information and reasons why negotiations for an NSA should be resumed. The candidate submits the request for reconsideration through the manager of Pricing Strategy to the vice president of Pricing and Classification (see 608.8.0 for address).
The 2010 Standard Mail Incentive Program provides volume pricing for qualified mail owners of Standard Mail or Nonprofit Standard Mail letters and/or flats that are able to document mail volume exceeding their individual USPS-determined threshold level, during the July 1, 2010 through September 30, 2010 program period. Participating mail owners documenting volumes above their established threshold level will receive a thirty percent (30%) credit, for each piece exceeding their individual USPS-determined threshold level, to a single designated permit imprint advance deposit account or Centralized Account Payment System (CAPS) account at the conclusion of the program period. In order to participate in the program, applicants must review and certify the accuracy of the data used by the USPS to calculate their threshold level and their June 2010 and October 2010 expected volumes.
a. Applicants must be able to document, in aggregate, volume of at least three-hundred and fifty thousand (350,000) pieces of Standard Mail or Nonprofit Standard Mail letters and/or flats in the July 1, 2009 to September 30, 2009 time period as follows:
1. Volume through one or more permit imprint advance deposit accounts, precanceled stamp permits, or postage meter permits owned by the applicant, or
2. Volume prepared by a mail service provider when entered through a permit owned by the applicant, or Volume within a mail service provider's permit, which can be identified as being prepared on behalf of the applicant.
a. Thresholds will be calculated independently for each applicant, based on the consolidated volume of Standard Mail letters and/or flats mailed within the period from July 1, 2009 to September 30, 2009.
b. Five percent (5%) above (or 105% of) the total consolidated volume mailed during this period defines the USPS-determined threshold level for an individual applicant.
Mail owners identified by the Postal Service as being eligible to participate in the program will be sent an invitation letter on or before May 1, 2010. Mail owners may apply for the program as follows:
b. Mail owners wishing to participate in the program must initially apply online, or contact the USPS, at email@example.com no later than May 28, 2010.
c. Mail owners completing the online application process will receive an electronic response from the USPS that includes:
1. An individual volume threshold report displaying the applicant's July 1, 2009 to September 30, 2009 Standard Mail letters and flats volume mailing history (by permit number), the applicant's USPS-calculated threshold, the applicant's June 2009 and October 2009 mailing histories and the USPS-calculated expected June 2010 and October 2010 volumes.
d. Applicants agreeing with the volume histories and USPS calculations can sign the provided certification letter and return a copy via email to firstname.lastname@example.org, or mail hardcopy to Summer Sale Program Office, 475 L'Enfant Plaza, SW, RM 5410, Washington, DC 20260-5410, no later than June 30, 2010, to be fully registered for the program.
e. Applicants not in agreement with any portion of their volume histories must complete threshold inquiry form and return it, via email to email@example.com, or mail hardcopy to Summer Sale Program Office, 475 L'Enfant Plaza, SW, RM 5410, Washington, DC 20260-5410, no later than June 30, 2010.
f. Applicants disputing USPS volume histories or calculations will be required to provide supporting evidence as appropriate.
g. Upon resolution of threshold and expected volume figures, applicants must provide a copy of the certification letter as described in item d.
h. Mail owners wishing to participate in the program, who believe they meet the eligibility standards under 2.2 and were not notified by letter, may request a review of their eligibility by contacting the USPS at firstname.lastname@example.org no later than May 15, 2010.
a. Standard Mail or Nonprofit Standard Mail letters and/or flats volume mailed by the participant through the participant's own permit imprint advance account, precanceled stamp permit(s), or postage meter permit(s);
b. Standard Mail or Nonprofit Standard Mail letters and/or flats volume prepared by a mail service provider, when entered through a permit owned by the participant;
c. Standard Mail or Nonprofit Standard Mail letters and/or flats pieces mailed through a mail service provider's permit, only when the pieces can be identified as being prepared for the participant and when the applicant's prior mailing activity through the mail service provider's permit can be validated.
Approved participants demonstrating an increase in Standard Mail or Nonprofit Standard Mail letters and flats volume above their threshold level qualify for a credit to a single designated permit imprint advance deposit account or Centralized Account Payment System (CAPS) account as follows:
a. The total postage paid for Standard Mail or Nonprofit Standard Mail letters and flats recorded during the program will be identified for each participant.
b. The total postage paid during the program period will be divided by the total number of recorded pieces to generate the average price per piece for the program period.
c. Participants will receive a credit in the amount of thirty percent (30%) of the average price per piece applied to the total number of mailpieces (less any adjustments resulting from the mailing activity review under 2.7), for the incremental volume above their threshold level, recorded during the program period.
Mailing activity by participants will be reviewed in the calendar months preceding and following the end of the program. The qualifying volume recorded for participants may be adjusted in accordance with the following:
a. For the 2010 Standard Mail Incentive Program, each participant's June 2010 and October 2010 expected volume will be defined as five percent (5%) above (or 105% of) the total consolidated volume of Standard Mail letters and/or flats recorded for the participant in June 2009 and October 2009 respectively.
b. Each participant's actual June 2010 and October 2010 volume will be compared to their respective June 2010 and October 2010 expected volume.
c. Participants demonstrating a shortfall in volume to either their June 2010 or October 2010 expected volumes will have that shortfall deducted from the number of mailpieces eligible for an incentive credit within the program regardless of any surplus demonstrated in the expected volume threshold of the other month.
An Alternate Postage Payment for Greeting Cards, using Intelligent Mail technology, is being tested in a 2-year program from January 2, 2011, through December 31, 2012. Participants pay for postage based on sales data reported to the Postal Service. Each mailpiece is scanned and counted as it moves through postal mail processing equipment. Reports allow a debit from the participant's Centralized Automated Processing System (CAPS) account for the postage that was not paid based on sales data. Mailpieces may be addressed to any domestic location by the sender.
3.2 Prices and Fees
There is no fee to participate in the market test. Participants agree to pay the market test postage price, which is higher than the First-Class Mail single-piece letter price, for each greeting card sold or mailed. Participants must have sufficient funds in their CAPS account to cover the market test postage for the mailpieces. Participants pay postage as follows:
a. At least 50 percent of the market test postage price will be paid to the Postal Service based on the participant's reports of greeting cards sold. When a greeting card is sold to an individual customer, payment will be retained by the Postal Service, whether or not the greeting card is mailed.
b. The remainder of the postage will be collected based on scans of Intelligent Mail barcodes on mailed pieces as specified in 3.5. The scans will produce a count of pieces processed, allowing appropriate postage to be deducted from the CAPS account.
Greeting card companies interested in participating in the market test must conform to the following standards:
a. Each greeting card company must request and obtain written consent from Transactions and Correspondence (see 608.8.1).
c. Participants must print a unique Intelligent Mail barcode on each mailpiece using the Mailer ID (MID) assigned exclusively for the market test by the program office.
d. Participants must establish quality control measures to ensure production of mailpieces meeting all standards in 3.0.
A participant that terminates the market test prior to the end of the program period must maintain their CAPS account and will remain liable for 100 percent of the market test postage for each greeting card sold, but not scanned, at the time they terminate the agreement.
b. Legend: First-Class Mail, permit number, and the city and state where the permit is held. Participants must maintain a permit imprint account.
The Postal Service will assign Mailer IDs to be used exclusively for the market test, approve all mailpiece designs prior to the production, distribution, and sale of greeting cards, and conduct pre-production tests of mailpieces.