In 2005 the Postal Service tested and deployed modifications to its bulk mail center sortation equipment software to provide management reports and displays. IDS software enhancements to handle the Intelligent Mail initiatives and mail tracking services were also deployed. The Surface Visibility program is also leveraging the IDS infrastructure by using its database resources and unit load scan information collected from material handling equipment.

B. UNDELIVERABLE-AS-ADDRESSED MAIL

The Postal Automated Redirection System automates the handling of undeliverable-as-addressed (UAA) letter mail, intercepting a portion of it in the early steps of the distribution process to reduce handling and processing costs and improve service. The system electronically notifies mailers who subscribe to the Address Change Service and provides hard copy notification to mailers who add an endorsement to their mailpiece. Both services generate revenue. The system also automates the processing of change of address forms that were previously processed manually via mechanized terminals.

During 2005 the Postal Service completed PARS Phase I deployment to 50 processing plants, 15 RECs, and all associated delivery units. The Change of Address Forms Processing System, which automates the processing of change of address forms, was also implemented and provided scanning equipment to all 87 central forwarding sites.

The PARS Phase II Program is expected to cover most of the remaining UAA letter mail by deploying PARS to 233 additional processing plants and their associated delivery units. Deployment started in August 2005 and is expected to be completed in September 2007.

C. ADVANCED FACER CANCELLER SYSTEM DOUBLES DETECTOR AND INK JET CANCELLER UPGRADES

When mailpieces are double-fed or become attached together on automated processing equipment, the mailpiece identification code on the back of the pair will not match the address on the front, and subsequent additional handling is required to correct the error. The Doubles Detector for the AFCS will reduce the associated re-handling and remote keying requirements and improve delivery performance. The Doubles Detector First Article Test was successfully completed in April 2005, and deployment on all 1,083 AFCS machines was completed in November 2005.

The AFCS Ink Jet Canceller (IJC) system will replace the current hub and die canceling mechanism with an ink jet printer. This upgrade provides many benefits: it is more reliable and requires less maintenance; it automates date setting and introduces a time stamp to enhance mailpiece tracking, tracing, and security capabilities; it provides flexibility in the cancellation appearance and content without the need to manufacture, deploy, and inventory new dies for each different cancellation mark; and it creates potential marketing opportunities.

The first article test was successfully completed in February 2005, and deployment on all 1,083 AFCS machines began in July 2005 and is expected to be completed in July 2006.

D. BUSINESS MAIL ACCEPTANCE

The Postal Service automated the labor-intensive process of evaluating bulk mailing eligibility for work-sharing discounts. The Mailing Evaluation Readability and Lookup INstrument (MERLIN) verifies nearly all mail preparation requirements for both letters and flats. It produces all reports necessary for mailing acceptance and provides the mailer with images of preparation problems to support process improvement. MERLIN has proven to be a vital factor in improving mail quality.

Another innovation is the PostalOne! system which provides business customers with a single point of electronic access to detailed mailing, payment, quality, and other postal and mailing information frequently requested. Migration of the acceptance unit and business reply user functions of the legacy PERMIT system into the new PostalOne! system was completed in 2004. In 2005 the Postal Service implemented acceptance and processing of electronic postage statements for Standard Mail mailings from the largest business customers.

The Postal Service continued support of PostalOne! Transportation Management where large mailers assign transportation to First-Class Mail letter trays in their own production facilities. The Postal Service continued testing and adding customers to the Electronic Verification System (e-VS) program which facilitates acceptance and verification of Parcel Select manifest mailings.

4. Material Handling

The Postal Service continues to deploy new material handling technology to increase efficiency and reduce costs. Development and production activities during 2005 included equipment for receipt, dispatch, and material transport operations within processing plants.

Deployment began for the Integrated Dispatch and Receipt (IDR) program into existing material handling systems at 229 mail processing facilities. IDR consists of ten different machines that automate functions associated with letter tray and flat tub preparation and tray transport equipment and will streamline the flow of materials. IDR will reduce costs in incoming and outgoing dock operations and in receipt and dispatch operations. Detailed designs were completed for IDR sites and installation is underway. Deployment will be completed in 2007.