GAO-02-315SP Mail Security and Postal Operations

December 20, 2001

The Honorable Dan Burton

Chairman

The Honorable Henry A. Waxman

Ranking Minority Member

Committee on Government Reform

House of Representatives

Subject: Highlights of GAO’s Conference on Options to Enhance Mail Security and

 Postal Operations

As you know, the U.S. Postal Service faces a number of formidable challenges as it

seeks to carry out its mission of providing affordable, universal service that binds the

nation together. With the recent anthrax attacks on Congress and the media, the

Service now faces a new and more immediate challenge of responding to those

attacks and developing a plan to safeguard the mail system from future attacks. To

assist the Service and its congressional oversight committees in addressing these

anthrax-related challenges, you asked that we convene a conference to identify

options, other than irradiation, to enhance mail security and postal operations.

On December 10, 2001, we held a conference of representatives from Congress, the

Service, and many of the Service’s key stakeholders (e.g., major mailers, mailer

associations, postal equipment manufacturers, postal unions, management

associations, and various federal agencies) to discuss possible options to enhance

mail security and postal operations. As agreed, we are providing this letter and its

enclosures to document the options identified and the issues that participants raised

at the conference for consideration by Congress, the Service, and other stakeholders

as they develop strategies to deal with potential terrorist threats to the mail system

and enhance postal operations. Enclosure I highlights the options offered by the

conference participants, and enclosure II identifies the issues raised as the options

were discussed. Enclosure III identifies the conference participants. The options

and issues presented here are those of the conference participants and do not

necessarily represent our views.

In general, the conference participants agreed that there is no single or simple

solution for ensuring the safety of the mail. Nevertheless, they agreed that the

Service, the mailing industry, and other stakeholders should work closely together to

assess current risks, develop a framework for responding to potential threats, and

take immediate steps to secure the safety of the mail to restore public confidence in

the integrity of the postal system. Many participants also agreed that detection

United States General Accounting Office

Washington, DC 20548
2 GAO-02-315SP Mail Security and Postal Operations

technology is essential for securing the mail. They also emphasized the need to

enhance the efficiency of postal operations.

Some of the options suggested to enhance mail security and operations included (1)

conducting risk-based assessments of potential threats; (2) redesigning and reducing

the number of collection boxes to enhance employee and public safety; (3)

encouraging the mailing industry to take steps to enhance mail security, such as

controlling access to their facilities and participating in a security certification

process for bulk mailers; (4) reducing the anonymity of mailers through such

measures as requiring identification from mailers and using video-enabled kiosks; (5)

creating separate mail streams corresponding to the level of risk associated with the

source of the mail; (6) accelerating the Service’s implementation of an “information

platform” to, among other things, track and trace mail using enhanced bar codes and

trackable postage; (7) changing postage rate structures to establish incentives for

mailers to promote security, such as discounts and surcharges; (8) communicating a

clear and consistent message to employees and the public on security-related

matters; and (9) reexamining the postal infrastructure and delivery standards to

improve efficiency and security.

Operational issues raised included the following questions: (1) What risks need to be

addressed, such as biological, chemical, radiological, and/or explosive threats? (2)

What role should the Service, the mailing industry, and others play in protecting the

mail? (3) What impact will efforts to reduce the anonymity of mail have on mailers’

convenience and privacy, mail volume, and mail cost? (4) What is the availability of

effective detection equipment? (5) What changes can be made to the postal

infrastructure to promote both efficiency and security? (6) What security measures

need to be taken immediately? and (7) What tradeoffs between mail security and

safety, service, convenience, and cost are the public and the mailing industry willing

to accept for the nation’s mail system?

Public policy issues included (1) whether self-regulation and/or federal regulation is

needed to provide oversight of the actions taken by the mailing industry to ensure

mail security and how such regulation would be carried out; (2) whether third-party

certification of detection and sanitization equipment is needed and who would

provide it; (3) whether the Service or another federal entity should be responsible for

sanitization of the mail; (4) whether manufacturer liability is hindering the

development of detection and sanitization equipment; (5) whether universal postal

service should continue to include “anonymous” mail and, if so, on what terms; and

(6) who should pay for enhanced mail security—taxpayers, current postal ratepayers,

future postal ratepayers, or a combination of these.

- - - - -
3 GAO-02-315SP Mail Security and Postal Operations

We are sending copies of this letter and its enclosures to the Chairmen and Ranking

Minority Members of the Senate and House Committees on the Budget; the Chairmen

and Ranking Minority Members of the Senate Committee on Appropriations and its

Subcommittee on Treasury and General Government; the Chairmen and Ranking

Minority Members of the House Committee on Appropriations and its Subcommittee

on Treasury, Postal Service, and General Government; the Chairmen and Ranking

Minority Members of the Senate Governmental Affairs Committee and its

Subcommittee on International Security, Proliferation and Federal Services; the

Postmaster General and Chief Executive Officer, U.S. Postal Service; and other

conference participants. Copies will also be made available to others upon request.

If you have any questions about this letter or the enclosures, please contact me on

(202) 512-8387 or at ungarb@gao.gov.

Bernard L. Ungar

Director, Physical Infrastructure

 Issues

Enclosures - 3
Enclosure I

4 GAO-02-315SP Mail Security and Postal Operations

Options Offered by Panel Members and Other Conference Participants for

Enhancing Mail Security and Postal Operations

Prevention Options

• Conduct risk-based assessments of potential threats.

• Assess what it takes to create the threat and to deliver, detect, and counter it.

• Ensure that countermeasures address the problem instead of deterring something

that might not be repeated.

• Educate employees on safe mail handling and the proper use of protective gear.

• Educate secondary and tertiary vendors regarding the need for heightened

security.

• Ensure that incident response plans are in place for facilities that receive and

process high volumes of inbound mail.

• Require that mailpieces have bio liners that can kill bacteria.

• Develop and implement a security certification process for bulk mailers.

• Distribute posters alerting mail preparation personnel and the public of the

penalties for hoaxes in the mail, and prosecute perpetrators to the fullest extent

of the law.

• Ensure that professional mailers have adequate procedures in place to

• strictly control access to their plants and work sites, such as requiring

deliveries to be made to restricted areas;

• secure transportation by taking such steps as sealing all inbound and

outbound shipments, using certified trucking companies; and recording and

checking the serial numbers of the seals on bills of lading;

• provide for a secure workforce by performing background checks and

establishing an employee identification program; and

• provide for adequate mailpiece design by such actions as using transparent,

tamper-resistant envelopes; a recognizable company logo on the outside of

mailpieces; and indicia or metered postage instead of live postage stamps.

• Develop standards for safe and secure bulk mail.

• Employ a mailer certification process.

• Independently assess the security operations of bulk mailers.

• Deny bulk mailers’ access to the mail system if they do not provide secure mail.

Options to Reduce the Volume of Anonymous Mail

• Issue “smart cards” encoded with “official” postal identification information (i.e.,

identity, postal address, and e-mail address).

• Allow the use of postal smart cards at video-enabled kiosks located in various

retail sites.

• Require presentation of a driver’s license and/or credit card or debit card when

purchasing stamps or mailing packages. An alternative would be to allow smart

cards to provide identification.
Enclosure I

5 GAO-02-315SP Mail Security and Postal Operations

• Expand retail presence in kiosks and mail service centers in food retail stores to

make services involving identification available.

• Develop envelopes with windows for both the mailing address and return address

that could be used for remittance mail.

Detection Options

• Equip collection boxes and mail slots with plastic bag liners that have one-way

throats and detection strips for a wide variety of bacteria.

• Provide postal workers with contamination detectors, which would be worn on

their breast pockets like radiation badges.

• Equip postal facers/cancellers with scanners that will alarm if they come in

contact with a threshold level of a contaminant.

• Use portable sampling devices to detect contaminants on the surface of packages

or in mail sacks and trays.

• Deploy currently available detection and sanitization technology—do not delay

deployment while waiting for more advanced technology to be developed.

• Develop detection strips for mailboxes and require that these strips be installed in

all mailboxes, including rural mailboxes and cluster boxes.

• Use third parties to certify the capabilities of detection and sanitization

technologies before procuring and deploying.

Mail Collection Options

• Conduct a comprehensive review of all collection boxes and mail slots and

determine if some of them could be eliminated because they are either served by a

local post office or infrequently used.

• Use sampling teams to test detection systems, such as those employed on

collection boxes with detection strips.

• Consider requiring cluster boxes for some existing housing.

Mail Preparation Options

• Use current technology to sanitize mail.

• Use available filtration systems to screen mail contaminants.

• Require that windowed envelopes be closed with a protective film to help prevent

cross contamination.

• Require that bulk mailers use tinted shrinkwrap for their mail, thus identifying the

mail as coming from a professional mailer and allowing for easier detection of

tampering.

• Require that film processors use transparent plastic envelopes with “safety” seals.
Enclosure I

6 GAO-02-315SP Mail Security and Postal Operations

Mail Processing Options

• Optimize the postal infrastructure to reduce redundancies.

• Install high-efficiency filtration systems within postal mail-processing facilities to

minimize the spread of contaminants from the mail.

• Develop and deploy filtration systems for mail-processing equipment to identify

and limit the spread of contaminants from the mail.

• Create three separate mail streams corresponding to the level of risk associated

with the source of the mail. That is, high-risk anonymous mail (e.g., mail from

collection boxes on the street), medium-risk semi-anonymous mail (e.g., packages

and other mail handed to a window clerk), and low-risk mail (e.g., bulk mail from

a known shipper).

• Do not merge collection mail with bulk mail until decontamination testing of the

collection mail has been completed to help prevent cross contamination.

• Test sanitization equipment on actual anthrax spores. Do more testing of the

impact of sanitization on different types of mail.

• Task a federal organization other than the Service with responsibility for

operating and financing the sanitization equipment.

Options for Tracking Parcels and Other Mail

• Develop and deploy an information platform that will allow the Service to track

and trace mailpieces and provide customers with real-time information on the

status of their mailings.

• Digitally watermark and/or have indicia on all stamps and prestamped envelopes

to allow them to be tracked and traced by lot number and by the post office that

sold them.

• Update the Service’s Point-of-Sale (POS) system with a transaction-based

database that will provide the capability to record stamp sales by type, lot

number, and purchaser’s name and address.

• Market PC postage more widely—for example, through kiosks. PC postage

products create Information Based Indicia—a two-dimensional (2D) bar code to

convey security and mail-processing information about the mailpiece.

• Issue “official” USPS e-mail addresses.

• Develop database cross-linking e-mail and postal addresses to enable businesses

to use hard-copy mail when customers do not respond to e-mail.

Options for Using Information Technology to Create “Intelligent Mail”

• Expand the use of two-dimensional bar code technology to provide additional

data for tracking the mailpiece and make this technology available to all mailers.

• Redesign the Domestic Mail Classification Schedule (DMCS) to provide mailers

with discounts to encourage maximum participation in programs that enhance

mail security and the Service’s cost efficiency.
Enclosure I

7 GAO-02-315SP Mail Security and Postal Operations

Infrastructure or Network Options

• Reexamine the entire postal system to improve both mail security and safety as

well as postal operations.

• Expand the Service’s retail presence through the use of kiosks and “mail service”

centers located in food retail stores.

Rate Structure or Pricing Options

• Change the postage rate structure to establish incentives for mailers to promote

mail security, such as surcharges, discounts, and/or new mail classes or

subclasses.

• Divide First-Class Mail into two new subclasses—(1) single-piece mail that

requires additional security handling by the Service and (2) bulk mail from presort

houses that requires no additional handling.

• Create a new class of mail, such as “Second-Class Mail.” This mail would be

sealed against inspection and subject to slower delivery than First-Class Mail.

Second-Class Mail could include anonymous mail, such as greeting cards, and

would be irradiated.

• Establish discounts for PC postage.

Options for Changing Delivery Standards to Enhance Mail Security

• Provide for discounts or different delivery standards for mail based on the level of

security standard met.

Options for Financing Costs Relating to Mail Safety and Security

• Increase postage rates.

• Increase limits on the Service’s borrowing authority.

• Impose a surcharge on anonymous mail that requires more safety or security

measures, such as sanitization.

• Congress could appropriate funds to cover the additional security-related costs

since September 11, 2001. (Appropriations to the airline industry would be a good

model to follow.)

• Congress could fund any requirements to irradiate mail and to provide special

handling and safety measures for government mail.

• Congress could appropriate funds to enable the Service to complete the

information platform in a much shorter time frame than would otherwise be the

case.

• Require mailers to initiate safety and security measures and bear the cost.
Enclosure I

8 GAO-02-315SP Mail Security and Postal Operations

Options for Responding to Incidents

• Have call centers for employees, customers, and postal operations.

• Communicate a clear and consistent message on the incident and what is being

done.

Other Options

• Build public confidence in the integrity of the mail system by communicating

steps being taken to provide for a secure and safe mail system.

• Create a greater deterrent by communicating the ability to identify the

perpetrators of threats and hoaxes as well as the consequences of these crimes.

• Rely on the mailing industry to communicate the importance of mail and the

mailing industry to Congress and the public.

• Review privacy statements on whether the Service will pass along customer

information.

• Clearly mark all bulk mail shipments.

• Update or create business continuity plans for critical postal functions.

• Include mailing industry representatives on the Communicating and Messaging

Working Group of the Postal Service’s Mail Security Task Force.
Enclosure II

9 GAO-02-315SP Mail Security and Postal Operations

Issues Raised by Panel Members and Other Conference Participants

Regarding Mail Security and Postal Operations

Issues Raised

• What tradeoffs between mail security and safety, service, convenience, and cost

are the public and the mailing industry willing to accept for its mail system?

• To what extent should the mail system be accessible and enable customers to

send “anonymous mail?” Should such mail be surcharged?

• Are sufficient financial resources available to implement improvements? What

level of cost is appropriate—is there some limit on what is worth doing,

considering the risk? What will be the impact of costly measures? Are decisions

being overly influenced by the associated cost?

• What risks need to be addressed, including biological, chemical, radiological, and

explosive risks?

• What is the objective (e.g., to detect and deter risks or to restore public

confidence)? To what extent do different objectives call for different approaches?

• What level of detection or sanitization will be required to maximize public

confidence in the safety of the mail?

• To what extent should the Service provide a universal system with measures to

help ensure mail security and safety? Should measures taken by the mailing

industry be considered sufficient for its mail to bypass some or all of the Service’s

measures (e.g., drop-shipped mail that could avoid sanitization and/or detection)?

• Should irradiation be the Service’s primary method of securing the mail or should

it be placing more emphasis on such efforts as early detection of contaminated

mail, developing an information platform, tracking and tracing, and smart stamps?

Is cost-effective detection technology available that can be fully deployed for all

mail, including mail drop-shipped to post offices?

• What is the appropriate balance between the public’s right to privacy versus the

Service’s need to know the identity of mailers in order to increase mail security?

• What can be done to reduce anonymous or unknown mailers?

• How can the Service and the government best assess the risks associated with

using the mail system for terrorist purposes and develop an appropriate

framework to respond to threats?

• Who should bear the additional cost associated with securing the mailstream—

taxpayers, current postal ratepayers (through rate increases), future postal

ratepayers (through borrowing), or a combination of these? If current ratepayers

are to bear the additional cost, how should that cost be allocated?

• What role should mailers play in protecting the mails? What role should their

suppliers play (e.g., envelope suppliers and paper mills)? Should there be a

different standard for the Service and others (e.g., in the filtration and detection

equipment used)?

• Are there lessons to be learned from foreign postal administrations that could

improve postal operations and better protect the mail?
Enclosure II

10 GAO-02-315SP Mail Security and Postal Operations

• Should the Service purchase currently available technology to detect

contaminants and sanitize the mail, or should it delay those purchases until better

technology is available?

• Who should be liable in the event of terrorist acts involving the mail? Should

liability be capped? Is third-party product liability hindering efforts to develop and

implement new technology to detect contaminants and sanitize the mail?

• Does the Service’s current infrastructure promote maximum effectiveness and

efficiency?

• How should the Service process mail that is known to be sensitive to current

sanitization technology, such as photographic film and pharmaceutical products?

• What legislative changes, if any, might be needed to improve postal operations

and protect the mail from terrorists?

• Who decides whether measures taken by mailers are adequate to protect mail

security and safety? Is self-regulation adequate to ensure mail safety and security

and public confidence, or is federal regulation and oversight needed to ensure that

the mailing industry has taken adequate measures?

• If federal regulation is needed, would there be standards against which to

regulate? Who would have responsibility for regulation: the Service, the

Occupational Safety and Health Administration, the Postal Rate Commission,

and/or other federal agencies? What enforcement mechanism is appropriate?

• Should sanitization and detection equipment receive third-party certification?

Would this be a federal responsibility? If so, how can this be done with the

current limited testing capacity?

• How quickly does progress need to be made? Do different time frames apply to

different measures?

• How should the Service be held accountable for making progress on such steps as

the information platform?

• Whose job is it to convince the public that the mail is safe: the Service, the mailing

industry, or Congress?

• Who is going to follow-up on the options and questions raised at the conference?

• What impact will efforts to reduce the anonymity of mail have on mailers’

convenience, mail volume, mail cost, and mailer privacy?
Enclosure III

11 GAO-02-315SP Mail Security and Postal Operations

Panelists and Other Participants of the GAO Conference on Options to Enhance

Mail Security and Postal Operations

Introductions

The Honorable David M. Walker

Comptroller General of the United States

U.S. General Accounting Office

Bernard L. Ungar

Director, Physical Infrastructure Issues

U.S. General Accounting Office

Jack Potter

Postmaster General, CEO

U.S. Postal Service

The Honorable Henry A. Waxman

Ranking Minority Member, Committee on

 Government Reform

House of Representatives

The Honorable Ernest J. Istook

Chairman, Subcommittee on Treasury,

 Postal Service, and General Government

Committee on Appropriations

House of Representatives

Panel 1: Options for the Postal Service to Enhance Mail Security and Postal

Operations

Mary Elcano - Moderator

Sidley Austin Brown & Wood LLP

Allan Algazi

Symbol Technologies

Maynard Benjamin

Envelope Manufacturers Association

John Campo

Pitney Bowes, Inc.

Richard Fairfax

Occupational Safety and Health Administration
Enclosure III

12 GAO-02-315SP Mail Security and Postal Operations

Michael Schmidt

Deutsche Post World Net

Ken Weaver

U.S. Postal Service

Panel 2: Options for Mailers to Enhance Mail Security and Postal Operations—

Mail Preparation and Information Technology Strategies

Gene A. Del Polito - Moderator

Association for Postal Commerce

John Campanelli

R.R. Donnelley Logistics Services

Eric Casey

Mailing & Fulfillment Service Association

Judy Marks

Lockheed Martin Distribution Technologies

V. Joseph Renna

Pharmaceutical Care Management Association

Seth Weisberg

Stamps.com

Summary of Conference

David Treworgy

PricewaterhouseCoopers LLP

Other Participants

Alison Bean

Senate Committee on Governmental Affairs

Brooke Brewer

Senate Committee on Governmental Affairs

Peter Dees

Senate Committee on Governmental Affairs

Nanci Langley

Senate Committee on Governmental Affairs
Enclosure III

13 GAO-02-315SP Mail Security and Postal Operations

Susan Propper

Senate Committee on Governmental Affairs

Robert Westbrooks

Senate Committee on Governmental Affairs

Tammy Hughes

House Appropriations Committee

Ed Puccerella

House Budget Committee

Kate Anderson

House Committee on Government Reform

Phil Barnett

House Committee on Government Reform

Andrei Greenawalt

House Committee on Government Reform

Michael Layman

House Committee on Government Reform

Denise Wilson

House Committee on Government Reform

Nick Manetto

House of Representatives

William Heniff

Congressional Research Service

Frank Brennan

U.S. Postal Service

Tom Day

U.S. Postal Service

Sheila Meyers

U.S. Postal Service

John Rapp

U.S. Postal Service

Jim Roman

U.S. Postal Service
Enclosure III

14 GAO-02-315SP Mail Security and Postal Operations

Wayne Wilkerson

U.S. Postal Service

Dave Willard

U.S. Postal Service

Len Read

Office of the Inspector General

U.S. Postal Service

Robert Cohen

Postal Rate Commission

Daniel LaPlaca

Office of Management and Budget

Dr. Lawrence D. Kerr

Office of Science and Techology Policy

Dr. Jeffrey S. Kieft

Office of Science and Techology Policy

Clint Chamberlain

Office of Public Health Preparedness

Brian Little

Occupational Safety and Health Administration

Dr. Kevin D. Crowley

National Academy of Sciences

Hans Martin

Federal Bureau of Investigation

Melissa Willig

Federal Bureau of Investigation

Henry Maury

General Services Administration

Neil A. Boyer

Department of State

Linda Elliot

D.C. Circuit Court
Enclosure III

15 GAO-02-315SP Mail Security and Postal Operations

Michael Reid

American Postal Workers Union

Al Ferranto

National Association of Letter Carriers

Dick Collins

National Postal Mail Handlers Union

Dale Holton

National Rural Letter Carriers Association

Ted Keating

National Association of Postal Supervisors

Bob Levi

National Association of Postmasters of the United States

Joe Cinadr

National League of Postmasters of the United States

Tony Gallo

Association for Postal Commerce

Peter Jacobsen

Association for Postal Commerce

Robert Laybourn

Association of Priority Mail Users, Inc.

Edward Hudgins

Cato Institute

Ari Schwartz

Center for Democracy & Technology

Edward Gleiman

Direct Marketing Association

Russ Snyder

Greeting Card Association

Robert E. McLean

Mailers Council

Cecilia Daly

Magazine Publishers of America
Enclosure III

16 GAO-02-315SP Mail Security and Postal Operations

David Todd

Mail Order Association of America

Jack Estes

Main Street Coalition

Robert J. Brinkman

Newspaper Association of America

Joel Thomas

National Association of Presort Mailers

Senny Boone

National Newspaper Association

Mike Cavanagh

National Postal Policy Council

James Pierce Myers

Parcel Shippers Association

Brett Martin

Pharmaceutical Care Management Association

Wolfgang Pordzik

Deutsche Post World Net USA, Inc.

David Nassef

Pitney Bowes, Inc.

David Zaharchuk

PricewaterhouseCoopers LLP

Robert Grabowski

Symbol Technologies

(543015)