Nonprofit Organizations' Eligibility for Reduced Third-Class Postal Rates

A review of the file folders for 110 selected nonprofit organizations showed that the Postal Service followed its criteria for granting reduced third-class rates, although it was impossible to determine how many applications for reduced rates were denied by the Baltimore Service Center and subsequently approved at the Postal Headquarters. One hundred organizations, randomly selected from the 1,841 nonprofit organizations approved since 1952 and authorized to deposit third-class reduced rate mail at the Baltimore Post Office, and the 10 largest volume nonprofit organizations mailing from Baltimore during 1976, were included in this study.

Based on the information contained in the organizations' individual files, all of these organizations meet the Postal Service's criteria for reduced third-class rates. None of the files contained any disqualifying evidence. Records at the Baltimore Post Office showed that 70 organizations received tax exemptions from the Internal Revenue Service and 55 organizations submitted charters or bylaws as evidence of their eligibility for the reduced rates. Of the 78 organizations that mailed at the reduced third-class rates during 1976, all had paid the required mailing fee, but 20 had failed to respond to questions on the Mailing Fee Notice, which must be completed annually, as to whether the purpose, function, and nonprofit status of the organization's exemption status for federal tax purposes had changed during the preceding 12 months. The Baltimore Post Office has established follow-up procedures to ensure the completeness of returned notices as a result of this inquiry.