The following changes to the Domestic Mail Manual are incorporated into the online version available via Postal Explorer at http://pe.usps.gov.

DMM Revisions

FSM 1000 Redesignated as UFSM 1000

Effective October 2, 2003, the term “flat sorting machine (FSM) 1000” has been changed to “upgraded flat sorting machine (UFSM) 1000” throughout the Domestic Mail Manual. This redesignation is based on enhancements made to the FSM 1000.

Mailers who have stocks of polywrap film endorsed “USPS FSM 1000 Approved Polywrap” may continue using that film until October 2, 2004. Any mailer requiring an extension beyond that date must contact the appropriate rates and classification service center for approval to continue using any remaining film with the old endorsement.

Parcel Return Services Experiment

Effective October 19, 2003, DMM G993 is added to set forth the standards adopted by the Postal Service to implement the Parcel Return Services (PRS) experiment pursuant to the Decision of the Governors of the Postal Service approving the Recommended Decision of the Postal Rate Commission in its Docket No. MC2003-2. The recommended decision is based on the Stipulation and Agreement that represented a negotiated settlement of all issues in that docket.

The Postal Service is conducting this PRS experiment to respond to the rapidly evolving market of Internet and catalog sales. Merchandise sales inevitably lead to returns, and many consumers, as well as Internet and catalog retailers, rely on the Postal Service for return of merchandise. By taking advantage of new ways of handling returned parcels, the new PRS experiment can provide convenience to consumers and competitive prices for retailers. Commercial shippers generally enter their parcels in bulk at Postal Service facilities near their destinations and receive discounts for doing so. With the PRS experiment, they will be able to pick up returns in bulk at those same facilities and receive discounts for the handling and transportation costs the Postal Service otherwise would have incurred for single- piece handling and transportation of those parcels back to the original shipper. Thus, the experiment provides return parcels with the benefits of worksharing and the advantages of Parcel Select® service realized by mailers for outgoing parcels.

PRS consists of three rate categories for returned Package Services parcels retrieved in bulk by a permit holder.

• The Parcel Select return delivery unit (RDU) rate category applies to Parcel Post subclass parcels retrieved from a designated delivery unit. For this experiment, designated delivery units are those that offer extended hours for entry of Parcel Select-DDU parcels. The RDU rates are flat rates that do not vary by weight. There is one rate category for all regular- sized parcels and a separate flat rate for all oversized parcels.

• The Parcel Select return bulk mail center (RBMC) rate category applies to Parcel Post subclass parcels retrieved in bulk from any of the 21 bulk mail centers (BMCs) listed in DMM L601, or other equivalent facility. Permit holders are required to develop reverse manifests of each piece they retrieve.

• The Bound Printed Matter (BPM) return bulk mail center (RBMC) rate category applies to BPM subclass parcels retrieved in bulk from any of the 21 BMCs. Permit holders are required to develop reverse manifests of each piece they retrieve. Flat- shaped single-piece rate BPM pieces eligible for a rate reduction in the form of a flat differential do not qualify for the RBMC rate. There is no separate BPM rate for parcels retrieved from RDUs. BPM parcels can qualify as PSRS parcels retrieved from a designated delivery unit.

As part of this experiment, participants will be charged the applicable rate in new DMM G993.3.1 through 3.4.

Parcels must be retrieved on a regular schedule. From BMCs, a minimum of every 48 hours excluding Sundays and Postal Service holidays, and from designated delivery units, a minimum of once every 7 days. Permit holders or their agents would be required to set up a recurring or standing appointment to retrieve PRS parcels. If the permit holder (or agent) already has existing appointments to deliver Parcel Select parcels to a BMC or DDU, the same appointment can be used for retrieving PRS parcels.

Participation in the first year of the experiment will be limited to 20 approved participants (permit holders). An additional 10 participants may be added during the second year. Participants will pay one annual PRS permit fee and one annual PRS advance deposit accounting fee of $150.00 and $475.00, respectively, at the Post Office where the PRS permit is held. Only one permit and accounting fee is required for each participant (permit holder). Payment of these fees allows permit holders to retrieve both Parcel Select and BPM PRS parcels for their clients, as well as their own parcels, at all approved locations. Permit holders must use the Centralized Account Processing System (CAPS) electronic postage payment system to fund postage payments for all returns through all locations. Information on CAPS can be found at http://caps.usps.gov.

The PRS permit may be canceled by the Postal Service for failure to maintain sufficient funds in a trust account to cover postage and fees on returned parcels, for distributing labels that do not conform to Postal Service specifications, or for several other reasons set out in this rule.