SUBJECT: Legislation Before Congress Affecting Fundraising/Nonprofit Postage Rates
DATE: APRIL 17, 2001

Please take time right now to put the attached letter (or a similar version) on your organization’s stationery and send it to your representative and other Congressional contacts in Washington.

Support is needed for important federal legislation, H.R. 1169, that will allow nonprofit organizations to continue to use the special nonprofit postage rates to mail fundraising letters. H.R. 1169 is designed to prevent the Postal Service from applying commercial postage rates to nonprofit fundraising letters under the Cooperative Mailing Rule. Already, the Postal Service is in the process of issuing postage deficiency assessments in the millions of dollars against various organizations that mailed fundraising letters at the nonprofit postage rates. Nonprofits and their fundraising agencies stand to lose millions of dollars if this legislation is not passed.

The Postal Service has recently taken the position that nonprofit postage rates are not available to fundraising letters if the nonprofit organization does not shoulder 100 percent of the risk of the mailing. In one instance, the Postal Service issued a postage deficiency of $3.8 million against a fundraiser who is required by state solicitation laws to bear some of the risk and contractually guaranty that a certain percentage of fundraising proceeds go to the nonprofit clients. The Postal Service is also attempting to assess postage deficiencies against a number of other fundraising arrangements, including no-risk contracts, and has revoked the nonprofit postage permit of at least one nonprofit because of certain contractual terms contained in its lease with the City of San Diego.

The Postal Service has made it clear that it intends to go after nonprofits and fundraisers with similar arrangements, and unless this legislation is enacted, much of the nonprofit community is at risk of losing the ability to mail fundraising letters at nonprofit rates.

H.R. 1169 will clarify that the nonprofit postage rates apply to fundraising letters regardless of the terms of contracts between nonprofit organizations and fundraisers, as long as the fundraising letters themselves would otherwise be eligible for the nonprofit rates. Thus, for example, the legislation will allow continued use of the special nonprofit rates even if state laws mandate contractual arrangements regarding risk of loss between nonprofits and their fundraisers that violate Postal Service policy preferences.

We already have the support of some key members of Congress who have introduced the bill, including Congressman Dan Burton, Chairman of the House Committee on Government Reform that will consider the bill, Congressman Filner (D-CA), and Congressman Ehrlich (R-MD). But we need as many co-sponsors and supporters as possible.

If you are a nonprofit organization, please send the attached letter to your Congressman today and ask your fundraising agency to do the same. If you are a fundraising agency, send the letter as suggested and ask all of your clients and vendors to do the same.

Please act now on this important legislation! The House Committee on Government Reform, through which the bill will be marked up, needs to know within the next two weeks that the bill has widespread support. The initial three co-sponsors of the bill need more co-sponsors.