award of a production contract is expected in late 2004 or early 2005, with deployment planned for 2005 and 2006.

     Current cost-reduction initiatives focus on maintaining critical systems and replacing obsolete ones.

     Transportation Optimization Planning and Scheduling (TOPS) is a program designed to plan and optimize the transportation network by scheduling transportation and routing mail to meet mail processing targets and service standard requirements at a minimum cost. TOPS will plan the movement of all mail traveling on all modes (contracted and postal) of transportation between all mail processing and transportation facilities, and from all domestic facilities to all international gateways. TOPS will also plan the transportation from mail processing facilities to our largest Post Office branches where surface visibility infrastructure exists. TOPS is designed to perform long range and week to week transportation optimization planning and analysis. The formulation of the model was completed in 2003 and efforts are now focused on synchronizing with the results of the logistics scanning pilot.

     The Surface Air Management System (SAMS) replaced the Air Contract Data Collection System in 2001 as the mailassignment engine. SAMS provides the ability to assign mail to indexed surface and air routes, to allocate capacity by mail classes, and track manifests online. The system also provides an individual routing assignment, with unique serial identification for each item presented for dispatch. The routing assignment and serial number are barcode printed on a self-adhesive dispatch and routing tag, which is applied to the item being dispatched. The dispatch and routing

tags are scanned, providing visibility for sacks, trays, and large parcels as they are handed-off to transportation suppliers until delivery back to the Postal Service at destination. These data is used for internal quality and performance monitoring and contractor compliance measures and in 2003 SAMS was aligned to support the Commercial Air Contract (CAIR-03).

     Since deployment in 2001, the Surface Air Support System (SASS) has integrated scan data received from transportation suppliers with existing transportation systems and has ensured service performance accountability and accurate payment verification. With SASS, the Postal Service created a central visibility database to receive assignment data from SAMS and scan data from Postal Service facilities and from our transportation suppliers. In 2002, the Enterprise Data Warehouse became the repository for data flowing from the SASS database. The data warehouse will also serve as the reporting tool for SASS data, giving the Postal Service better data regarding service performance for transportation suppliers, as well as information regarding mail transported on a specific flight, truck, or train. SASS began reconciling payment for the air carriers using scans received from these suppliers to measure performance.

     Field Operations Standardization Implementation objective is national improvement of Priority Mail service performance through shape-based separation and standardized processing methods. The objective will be achieved by separating Priority Mail items at the induction point and maintaining the separation throughout the mailstream.

     The Postal Service is developing a Priority Mail Operations Performance Toolkit, which will be available on the Breakthrough Productivity Initiative Web site in the first