1 Update on Proposed Prices and Standards Mailers’ Technical Advisory Committee Steve Kearney Vice President, Pricing & Classification Joe Moeller Manager, Pricing Sharon Daniel Manager, Mailing Standards John Nagla Manager, Implementation November 2006

2 PRC Recommendation (March 2) Litigation (May through March 2007) May Jun July Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Filing Date (May 3, 2006) 10 Months 1 Year Proposed Standards (September 27) Proposed Standards Comment Period Ends (November 13) Update on Proposed Prices and Standards Timeline and Important Dates Revised Standards (Early January) Interim Final Standards (Early February) Final Standards (Early March) Implementation Decision (Early March) Implementation (May 6) We Are Here

3  57 Interveners  2,962 interrogatories  54 pieces of testimony filed by interveners  Hearings through November 8  Rebuttal testimony due November 20  December: More hearings, and briefs Update on Proposed Prices and Standards The rate case

4 Container Charge 85¢ container charge applies to pallets, sacks, and trays ContainerPays Bundles on palletsPer pallet Trays on palletsPer pallet Sacks on palletsPer sack SacksPer sack TraysPer tray Unsacked carrier route bundles entered at DDUs Per each 5-digit/scheme serviced by DDU Update on Proposed Prices and Standards Periodicals – Outside-County

5 Length 6” min. 15” max. Height 5” min. 12” max. Thickness Min: 0.009” Max: 3/4” Update on Proposed Prices and Standards Flats Automation  AFSM 100 standards with new flexibility criteria  Rigid pieces pay parcel or Not Flat-Machinable prices  Required scheme preparation

6 Update on Proposed Prices and Standards Standard Mail 9 Not Flat-Machinable

7  5-digit, 3-digit, ADC, mixed ADC prices  DDU-entry if sorted to 5-digit/scheme (no minimum)  Follow parcel preparation (no bundles) –Less than 6 oz., nonmachinable preparation –5-digit/scheme, 3-digit, ADC, mxd ADC –6 oz. and over, machinable preparation –5-digit/scheme, BMC, mxd BMC  Optional 5-digit bundles on pallets –5-piece minimum required to qualify for 5-digit price Update on Proposed Prices and Standards Standard Mail

8  Mailpiece review prior to production  One-on-one discussions  Ensures consistent acceptance  52 current participants  Over 600 Rulings last year  Contact: Update on Proposed Prices and Standards National Customer Rulings Greg Hall Manager, National Customer Rulings Pricing and Classification Service Center 90 Church Street, Suite 3100 New York, NY

9  USPS.com/ratecase  DMM Advisory –Subscribe: Update on Proposed Prices and Standards Communicating