OIG Says USPS Says UAA Mail-Reduction Strategies Have Not Been Effective

From the USPS Office of Inspector General

Background
The U.S. Postal Service processed more than 155 billion
mailpieces in fiscal year (FY) 2014, 6.6 billion (4.3 percent) of
which were undeliverable as addressed (UAA). UAA mail is
costly, since it must be forwarded, returned, or treated as waste.
The Postal Service spent nearly $1.5 billion handling UAA mail
in FY 2014, and the mailing industry incurs about $20 billion in
UAA costs annually. OIG-Logo

According to a 2006 study conducted jointly by mailers and
the Postal Service, about 40 percent of UAA mail is caused
by the public, primarily because customers do not notify
the Postal Service of address changes. Thirty-five percent
is attributed to business mailers for reasons including,
not updating address lists and having to mail to incorrect
addresses to meet other legislative or regulatory requirements.
The Postal Service itself is responsible for about 23 percent
due to sorting errors or failed deliveries. The origin of the
remaining 2 percent of UAA mail is unknown.

Various factors hinder efforts to accurately match addresses
with recipients and ultimately reduce UAA mail. For example,
companies in the financial and insurance industries are
legally required to send mail to the last known address even if
Postal Service systems indicate a change of address has
been submitted.

As an incentive to reduce UAA mail, mailers must certify that
they periodically compare and update address lists against
customer-filed change of address orders to receive workshare
discounts. Even then, address list accuracy is not guaranteed.
The Postal Service has recently proposed eliminating the
certification requirement, but mailers have concerns about how
that change might impact them.

The Postal Service manually tests 3 percent of business
mail for address accuracy prior to entry into the mailstream.
A 30 percent per mailing error tolerance is permitted. This
threshold is intended to exclude the portion of UAA mail that
is beyond the mailer’s control. But this process is changing
with the implementation of Seamless Acceptance, which
electronically tests all business mail for address accuracy,
quantifies UAA mail, and identifies the sender.

Our objective was to evaluate the Postal Service’s strategies
for reducing UAA mail. This is the first of two reports. In our
next report, we will evaluate the Postal Inspection Service’s
enforcement efforts over the Revenue Investigations Program.
What The OIG Found
The Postal Service’s UAA mail reduction strategies have not
been effective, as evidenced by a 2.1 percent increase in UAA
mail from FY 2011 to FY 2014. This ineffectiveness is due to the complexity of the address verification process and conflicting
laws and regulations. The Postal Service is working to reduce
UAA mail volume that results from the public and the
Postal Service. For example, it has made it easier for recipients
to change their addresses by providing for online entry. It has
also implemented processes to use address changes noted by
letter carriers during deliveries.

But many of the Postal Service’s UAA reduction efforts address
business mail entering the mailstream and implementation of
Seamless Acceptance. Seamless Acceptance won’t eliminate
all UAA mail but will offer greater visibility into data associated
with each mailpiece. This newly available data will enable the
Postal Service to associate UAA mail with the sender and
provide opportunities to craft entirely new solutions to ensure
address standards are met.

In addition, the combination of Seamless Acceptance and
secure destruction brings opportunities for mailers and the
Postal Service to share information electronically and eliminate
the need to return mail pieces. The Postal Service and
stakeholders could reduce costs if they focus on using this new
data to develop solutions to the UAA mail problem.

What The OIG Recommended
We recommended the Postal Service work with mailers to
leverage new technologies to promote compliance with address
standards and more accurately attribute actual UAA mail costs.

Read This Report

Leave a Reply

Your email address will not be published.