Industry Alert - July 2007

New CASS Rules Go Into Effect on August 1

Postage Costs, Deliverability Impacted under CASS “Cycle L”

What is CASS?

CASS, which is short for Coding Accuracy Support System, is the process whereby your mailing records are reviewed for the quality of addressing and deliverability. CASS ensures that an address falls within a valid range of addresses in the USPS system. CASS-certified mail is automatable and thus you receive higher discount at the various presort levels.

For a variety of reasons, a small percentage of addresses on most files do not qualify under CASS. This does not automatically mean the address is no good; rather it means it does not appear on the postal database. For PMG’s nonprofit clients, this percentage is typically from 1-4% of a file. In the past, our clients typically have mailed these “non-qualified” names.

DPV and LACS

Effective August 1, 2007, all mail processed through CASS certification must be further analyzed using Delivery Point Validation, or DPV. The DPV database contains all 151 million actual addresses in the USPS system, down to the apartment, suite or unit number.

Thus, while the previous CASS process verified only that an address fell within a valid range of addresses, the new process using DPV will verify whether that specific address - or delivery point - actually exists in the USPS database.

To help fix some of these addressing problems, the USPS has also incorporated LACS into the new process. LACS, or Locatable Address Conversion System, is a database of updated addresses that will be used to help reduce the number of non-qualified names. It is important to understand that LACS deals with changes within the USPS addressing system, such as rural addresses that have been adjusted to be in compliance with 911 emergency systems; it is not a change of address file of people who have moved.

What About the Addresses That Flunk?

Our analysis during the first few weeks of using the new CASS software with DPV and LACS is that an additional half-percent or so of your addresses may fall into the non-qualified group. These are largely names that used to qualify as being within a valid range of addresses, but that now do not show up as a valid delivery point or address, according to the USPS database.

As an example, let’s say 123 Main Street qualified as valid under the old system because CASS showed that Main Street addresses ran from 1 to 400. However, the more detailed DPV database has no record of a specific delivery point of 123 and therefore that address no longer qualifies for automation.

You can still mail that address, and there is a reasonable chance it will be delivered - as you might expect, the local mail carrier sometimes knows better than a centralized computer system! But you may also want to isolate the non-qualified addresses and mail them separately a time or two to verify that you are not just mailing expensive materials and postage into a black hole.

Will DPV Result in Additional Postage Costs?

The number of additional names that will be disqualified for automation discounts is typically so small that any additional postage will not be statistically measurable for purposes of analyzing mailing returns.

Here are two examples to illustrate the very limited impact:

• Methodology
  We took two recent jobs, each for a different nonprofit client, which had not been run through the new
  "Cycle L" Cass with DPV and LACS and re-ran them using this new Cycle L update.
• Job#1 (Client A) is a file totaling approx 40M records
  Using the new Cycle L CASS with DPV and LACS, the number of qualified records actually increased from 39,960 to 40,036 records.

  A total of 76 previously non-qualified records received a delivery point as a result of the updated information contained in DPV and LACS. These records are now eligible for postal discounts of two to three cents each.

• Job#2 (Client B) is a file totaling approx 630M records
  Using the new Cycle L CASS with DPV and LACS, the number of qualified records decreased from 627,423 to 622,650.

A total of 4,773 records, or about 0.75% of the total file, changed from qualified to non-qualified as a result. The additional postage totals about $125.00.

Still have questions? Ask your PMG account manager for help. Using our in-house data processing and logistics department, we can analyze any of your mailing lists and provide details down to the individual address level to help you decide the best way to handle these records.