Alliance Report                                                          

December 4, 2025

Issue 25/11

 

The leading voice of nonprofits on postal issues for over 45 years.                                                                                        

Copyright 2025: Alliance of Nonprofit Mailers—All rights reserved. 

The Alliance of Nonprofit Mailers is a 501 (c)(4) nonprofit organization established by nonprofits for nonprofits.

 

USPS Files Section 207 Report (Progress Report to Congress on Postal Service Reform Act of 2022)

The USPS on December 4, 2025, filed its Section 207 report, a required periodic follow-up to the Postal Reform Act of 2022 (PSRA) every six months.  The report includes the USPS’ updated responses to a set of 15 Congressionally-identified items related to USPS growth, costs, network redesign, service performance and finances.

Postmaster General Steiner in his opening letter in the report says:

“This is my first report to the Administration and Congress under the requirements of Section 207 of the Postal Service Reform Act of 2022 (PSRA). As a retrospective report, it largely covers the period of time before I joined the organization in July of 2025. The report is also largely framed within the context of our original strategic plan, as it was articulated at the time of the PSRA’s passage, which sought operational and financial reform elements. Going forward, I plan to use subsequent reports as an opportunity to update policymakers not only on the required Section 207 items, but also on the evolution of our strategic plan. I will describe our new, exciting initiatives which will be rolled out over the coming months and years as well as any refinements we make to the original plan. Accordingly, I wish to use this letter to provide a brief overview of my initial thoughts since becoming Postmaster General and some details on our next steps.”

Although much data in the report has been redacted in the public version, the USPS provides updates on initiatives, including network redesign, volume and revenue trends, pricing strategies, transportation, staffing and other key areas.  The PMG also stated:

“In addition, as noted above, I want to re-engage with the Administration, the Congress, and the Postal Regulatory Commission on a series of common-sense reforms to our employee benefit obligations as well as constraints on our pricing and borrowing authority. We must secure reform to the Civil Service Retirement System allocation methodology. We need to implement private sector best practices to control workers’ compensation costs. We need to invest our retirement funds in a diversified portfolio. We need a pricing system that creates a rational relationship between our costs and revenues and adequately responds to our financial situation. And finally, we need to reform our ability to borrow, which has not been updated since the early 1990s. Addressing the limitations on our borrowing authority is also presently the most time sensitive reform we need to stabilize our financial position.” 

USPS FY2025 Package Volume Declined 5.7 Percent

The USPS’ reports of its FY2025 financial performance showed a 5.7 percent decline in parcel volumes.  According to the USPS’ Revenue, Pieces and Weights (RPW) Report for FY2025, USPS Ground Advantage volume was up 26.5% compared to FY2024, however, Priority Mail volume was down 24.4% and Parcel Select/Parcel Return Service volume was down 21.8%, and Priority Mail Express volume was down 8.8%.  Ground Advantage was also the only parcels category where the USPS saw revenue growth, and total Competitive Services revenue was only up by 0.5% over FY2024 (including International).

The USPS’ FY2025 parcel performance makes it a bit surprising that the USPS’ FY2026 Integrated Financial Plan (IFP) projects a 9.4% revenue increase from parcels.

USPS Monthly Financial Report for October

SLS Consulting has provided the below slides highlighting the USPS’ October 2025 Preliminary Financial information filed at the Postal Regulatory Commission (PRC).

It should be noted that Market Dominant volumes were at a heightened level in October 2024 due to the election.  This is a large reason for the substantial decline in Market Dominant volumes from the same period last year.

USPS Lays Out Plans for Cost Studies that Could Impact Postage Discounts

The USPS on December 2, 2025, filed a document with the Postal Regulatory Commission (PRC) in response to the PRC’s requirement that the USPS provide it with periodic progress reports on possible improvements to the quality, accuracy, or completeness of data provided by the USPS in its Annual Compliance Reports (ACRs).  The data used in the ACR is important because it can cause changes in the product costs calculated by the USPS and used to determine workshare discounts.

The USPS in its document outlines near-, medium- and long-term initiatives it is working on or considering.  A few of interest include:

Zone Structure for Marketing Mail and Periodicals.  The USPS in June 2025 had proposed replacing origin pricing with a zone-based structure for Marketing Mail  and Periodicals which effectively eliminated workshare drop-ship discounts for mail entered at the DSCF (destination Sectional Center Facility) rather than at origin.  The PRC rejected the USPS’ proposal, directing the USPS to develop a methodology for measuring the avoided costs if the USPS wanted to pursue a future proposal of this nature.  The USPS notes in the document filed December 2, 2025, that if it decides to again pursue zone structure for Marketing Mail and Periodicals, it would present the PRC with a rulemaking and methodology in FY2027.

USPS Network Changes.  The USPS also in the document discusses its plans to update cost data and methodologies based on changes in mailflow from its network modifications.  The USPS plans to initiate a rulemaking docket in FY2027 that would propose a “refreshed set” of mail processing cost pools based on the changes in its network design.

The USPS also said it believes the “availability of mailflow data beyond piece sorting operations” in the redesigned network supplies it with “opportunities to refine its set of mailflow models, improve its avoided cost estimates, and its benchmark price categories that are used for workshare relationships.”  The USPS is investigating whether and how container (i.e., tray, pallet, and/or wheeled container) movements and handlings can be accurately measured and incorporated into its set of mailflow models.   The USPS said it expects this outcome “would likely improve the models’ coverage of worksharing related activities and avoided cost estimates,” as well as “an improved alignment between prices, estimated avoided costs, and the evolving product offerings from the Postal Service.”  The USPS said it expects to file a series of rulemaking dockets on this through FY2028.

The USPS in its document also discusses studies and potential changes based on its new vehicle fleet being deployed, treatment of its retiree health benefits top-up payments, additional data it can use in developing more accurate costs, and more.

Important Update – Periodicals Mailing Privileges Application Process

The Postal Service would like to inform you of recent updates to PS Form 3500, Application for Periodicals Mailing Privileges, and the initial steps involved in the application process.

To help ensure a smooth experience, mailers new to the Periodicals application process should begin by contacting the Pricing and Classification Service Center (PCSC) for an initial review. This step helps confirm that basic eligibility requirements are met before proceeding.

Once PCSC determines that your publication is minimally qualified, you’ll be asked to:

• Pay the application fee at your Original Entry office
• Submit the completed application, payment receipt, and all required documentation requested directly to PCSC

All other aspects of the application and approval process remain the same.

This change does not impact any applications already submitted. If you have any questions or need assistance, feel free to reach out to PCSC at PCSC@usps.gov.

Building the Future of the Mailing Industry — One Connection at a Time

The Leaders Connect Mentorship Program is more than a networking initiative — it is one of the clearest examples of what can happen when the mailing industry and the United States Postal Service (USPS) work side-by-side toward a shared goal. Founded by industry members in partnership with the United States Postal Service (USPS), Leaders Connect provides an easy and rewarding way for experienced professionals to give back while helping emerging talent grow their skills, expand their knowledge, and build meaningful connections within the industry.

Leaders Connect is led by a Steering Committee of dedicated industry professionals all on a volunteer basis with the drive to give back to the mailing and shipping community.  Kim Waltz, Bob Rosser, Dina Kessler, Glen Swyers, Carol Kliewer, and Paula Stoskopf as well as Carl Boettner with the USPS are the driving forces behind Leaders Connect.  The support of Margaret Pepe, Executive Director, Product Solutions at USPS, was integral to the success of the program. Her commitment, along with the USPS’s active partnership, helped bring the concept of Leaders Connect to life and ensure its continued growth and reach across the industry.

Leaders Connect is a no-cost mentorship platform that brings together professionals across all areas of the direct mail and printing industry. Mentors share insights gained through years of experience, while mentees gain an understanding of how mail, data, and digital communication intersect in today’s evolving marketplace.

The commitment is minimal — just one to two hours a month — but the rewards reach far beyond the time invested. Mentors describe the experience as energizing and mutually beneficial, offering fresh perspectives and new learning opportunities for both participants.

👉 Hear firsthand from a mentor and mentee about their experience: Watch the video on LinkedIn.

“When we started Leaders Connect, our goal was to create a space where knowledge and encouragement could flow freely between generations,” said Kim Waltz, FSSI, one of the program’s founders. “It is amazing to see that vision come to life. I am so proud of how our partnership with the USPS has helped establish this platform. The time commitment is small, but the impact is enormous — both for mentees discovering their path in the industry and for mentors who rediscover the joy of learning through others.”

Mentors and mentees are matched through Qooper, an online platform that provides tools, educational modules, and scheduling resources to guide and support each relationship. Participants are encouraged to set goals, exchange ideas, and take actionable steps toward professional growth.

The collaboration between PCC, MTAC, and AIM reflects a shared vision: developing the leadership bench strength of tomorrow’s industry. By connecting experience with enthusiasm, Leaders Connect is shaping the next wave of innovators who will carry the mailing and shipping industry forward.

Whether you’re an industry veteran ready to share your expertise or a newcomer eager to learn, Leaders Connect offers the perfect starting point.

Join today at https://postalpro.usps.com/LeadersConnect — and become part of a community that is building the future, one mentorship at a time.

Alliance Educational Webinar 1/22/26 – Register Now!

The Alliance will be kicking off our new webinar series in 2026 with a great primer, “Nonprofit Postage Rates – Past, Present and Future,” where we will talk about the evolution of the laws and policies governing nonprofit rates in the past and those that apply today, as well as what to expect in the July 2026 USPS price change.

The webinar will be held on Thursday, Jan. 22, 2026, from 11-12 EST.  This first webinar will be open to all, so please share the information within your organization and with your nonprofit peers.  Registration is open at https://zoom.us/meeting/register/zvXk8r-ESSqgMdI-7bPgCw.

The Alliance is planning to hold more webinars in 2026, some will be restricted to Alliance members only, others will be open to all.  If there are specific topics or speakers your organization is interested in having a webinar on, email me at kathy@nonprofitmailers.org.