2.  Each year, 17% of Americans move or change their mailing address 1 out of every 6 families moves each year  Approximately 19% of all businesses move  USPS ® processes over 45 million permanent Change of Address (COA) orders each year  The USPS adds ~1.8 million new delivery points each year DUBASIK Moving & Storage

3.  24 of every 100 mail pieces contain Address Errors  5 of every 100 mail pieces are Undeliverable-as- Addressed (UAA)  75% of UAA Mail is Move-related First-Class Mail Move Related UAA Rate:2.6% Standard Mail Move Related UAA Mail Rate:4.8% First-Class Mail UAA Rate:3.4% Standard Mail UAA Mail Rate:6.4%

4.  November 2008, the Postal Service required all addresses on mailings that receive discounts for First-Class Mail or Standard Mail service… be updated with an approved method within 95 days prior to the mailing.  Effective January 4, 2010 began to assess a penalty of $.07 per piece in mailings with an error rate greater than 30% based on PBV samplings.  <6% of mailings are non-compliant Addresses must be Current, Correct and Complete

5.  Pre-Mailing ◦ NCOA - National Change of Address ◦ MLOCR with FASTforward ® (FFMUN option)  Post-Mailing ◦ Ancillary Service Endorsements ◦ ACS – Address Change Service  Traditional  OneCode  Full Service  Alternative Move Update ◦ 99% Rule ◦ Legal Constraint

6. How are addresses being updated?  64% use NCOA  54% use ACS  33% manually update UAA returned mail  22% have multiple databases – a key constraint!

7. Postage Statements  Whoever signs postage statement may be liable for Move Update compliance and penalties

8.  MERLIN systems test for Move Update compliance  Performance-Based Validation (PBV) score: Total COAs Updated By Mailer Total COAs found by MERLIN >=70% *Less than 5 COA are excluded from PBV

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10. Mailing 100,000 Sample Size 1,000 Addresses with COA 50 Addresses with Updates reflected on mail pieces 35 Addresses NOT updated 15 PBV SCORE (Update/COA) 70% 100,000 1,000 50 34 16 68% Assessment (2% x 100,000 x.07)$140.00 FAILED

11.  Matches include: ◦ COA between 95-days and 18-months ◦ New Addresses ◦ Moved Left No Address * ◦ Closed PO Box* ◦ Moved to Foreign Address* *Should be removed from mailing  Matches excluded: ◦ COA within 95-days or older than 18-months ◦ NIXIES (near matches, new address not validated)

12. “The PBV process does not establish compliance or non-compliance with the Move Update Standard; it is a tool that the Postal Service uses to test mailings.” -Federal Register

13.  Even if passing MERLIN, may not pass an audit  Postal Inspectors from Office of Inspector General  Audit of your internal update process  Primarily looking to get processes corrected  Also investigating intentional violators: ◦ False Claims Act ◦ Penalty is 2x or 3x Revenue Deficiency – 1 to 3-year window ◦ Plus: $11,000 per violation (each mailing statement)

14.  What do you need / Best Business Practice? ◦ Records of all mailings ◦ Copies of update data files ◦ Process Maps & paper trail of updates ◦ Report Tracking – proof of compliance ◦ Backup support of over-riding transactions ◦ Written standards, policies and enforcement mechanisms to ensure compliance of eligibility rules based upon method specified on Statements ◦ Demonstrated communications with employees, vendors and mail service providers regarding compliance

15.  The USPS must reduce the cost of UAA mail  The tools and services are now available to ◦ Determine compliance risk factors ◦ Implement compliant and best practice solutions  The cost of non-compliance can be significant  The USPS will continue driving down their UAA costs, which means tighter rules and/or higher fees and penalties  This also mean more or your mail will reach your intended customer in the most efficient manner at the lowest possible cost.

16. Move Update take-aways:  Ask about your PBV score  Use 1 or 2 Move Update methods  Update your database & mailing files  Document your update processes

17. 17 Questions?