With that in mind, the Postal Service continued to introduce innovative products and services that provide customers with more reasons than ever to use the mail. These efforts reflect the Postal Service's Transformation Plan strategy of pursuing growth by adding value for postal customers.

     One of the year's initiatives was the implementation of the first negotiated service agreement (NSA). This innovative pricing strategy provides mailers with customized rates and services that address their unique mailing needs and encourages cost-efficient practices, such as electronic — rather than hard copy — return of undeliverable-mail data, resulting in savings for the mailer and for the Postal Service. This first NSA, with Capital One Financial Services Corporation, features discounts for First-Class Mail volume above an annual threshold of 1.225 billion pieces and new requirements on the mailer for address correction.

     Other new product offerings that make the mail a more attractive channel include Repositionable Notes™ and Customized MarketMail™. Repositionable Notes permit direct mailers to enhance their mailpieces by applying "sticky notes" to their mailings. Since the notes can be easily removed from the envelope, the recipient can place them in a convenient location, such as on the phone, computer, or refrigerator, as a reminder of the mailer's offer. Customized MarketMail expands mailers' creative options by allowing the use of colorful, uniquely-shaped, attention- getting direct mailpieces that let their messages stand out from all the others.

     The Postal Service also implemented a new merchandise return service, also known as parcel return services. The new service helps streamline the mail handling process by providing discounts for mailers who pick up returned parcels when they mail packages at a designated postal facility, avoiding the need — and expense — of the Postal Service delivering the returned packages to the mailer's address.      Customer convenience remained a key service focus as the Postal Service continued its use of technology to make transactions easier, quicker, and more convenient. In addition

addition to online address changes, customers can now place temporary holds on mail delivery through the Postal Service's Web site, www.usps.com. The use of this Web site has increased by 38 percent over last year. Click- N-Ship , which allows customers to print Priority Mail labels right from their own computers - with or without postage - has added carrier pick-up service to the stable of already popular features such as no-fee electronic Delivery Confirmation. Mailers can also receive e-mail notifications for delivery of items shipped via Express Mail, Delivery Confirmation, Signature Confirmation, Certified Mail, and Registered Mail services. Click-N-Ship volume continues to grow, with a 370 percent increase over last summer. The increase in the use of these alternate channels decreases the transaction cost compared to traditional channels.

     The Postal Service is also relying on cutting-edge technology to enhance the safety and security of the mail — both for employees and customers — in the wake of the 2001 anthrax attacks. The Washington, D.C. vast Curseen-Morris Processing and Distribution Center (P&DC), formerly Brentwood P&DC, was successfully decontaminated in December 2002. Mail processing operations returned to the building following completion of a major facility renovation. The complex and innovative technology used to decontaminate the Washington plant was transferred to New Jersey's Trenton P&DC for a similar decontamination effort.

     The Postal Service successfully tested new technology for the detection of biohazardous materials in mail at major processing facilities throughout the nation. The Biohazard Detection System, which operates in conjunction with mail canceling equipment, continually draws in air from around the mail during the cancellation process. Using sophisticated genetic analysis, the system tests the air samples to determine if anthrax is present. If so, the facility is immediately evacuated, the flow of mail is halted, and necessary steps are taken to protect postal employees, customers, and the nearby community. The Postal Service has worked closely with community first responders to