“Pilot Test” Continues Adrift

Usually, when the Postal Regulatory Commission allows the Postal Service to conduct a test of a potential new product or service, there’s a finite arc of related events, such as a proposal by the USPS, review by the PRC, and establishment of a test with reporting requirements and specific start and end dates.  Over the test period, results are reported and, typically at the end of the test, the tested product or service is either made a permanent offering or abandoned.

Somehow still existing outside this usual process is a “pilot test” initiated by the Postal Service years ago.

The pilot test

On September 13, 2021, without any public announcement or approval by the PRC, the USPS quietly began a “pilot test” of what appeared to be a check-cashing service.  The test was implemented at one facility each in Washington (DC), Falls Church (VA), Baltimore, and the Bronx.

Because a new “non-postal service” requires PRC approval, the USPS cleverly framed the “test” as simply another way to buy a gift card (a service with prescribed fees that was already sanctioned by the commission), and allowed payment only with business and payroll checks of $500 or less.

The test was little publicized even where it was being conducted; only six sales were reported through January 2022, generating merely $37.50 in service fees.  The Postal Service maintained that the pilot was simply testing the acceptance of a different form of payment for gift cards.  Many observers, including some members of Congress and the PRC itself, weren’t convinced.


In its FY 2021 Annual Compliance Determination, issued March 29, 2022, the commission directed the Postal Service to report quarterly information on the “pilot test,” “including updates on volume and revenue, as well as future plans for the Pilot Program as long as it remains in effect.”  The PRC also directed the USPS

“… to file a notice of termination with the Commission when the Pilot Program ends, including notification no later than 14 days after the publication of the ACD of whether the Postal Service is continuing the program past its initially anticipated end date of March 2022.”

In its May 16, 2022 order establishing Docket No. MC2022-60, Modification of Special Services Product List, the PRC noted the USPS response to the directive in the ACD:

“… ‘the Postal Service has continued the pilot program,’ and ‘[n]o final determinations have been reached with regard to ending the pilot, or with regard to any other potential steps that might be taken to modify the pilot.’  The Postal Service further stated that it ‘remains of the view that the pilot program is an appropriate and limited test of an alternative payment method for the established gift card product, which does not implicate the current Mail Classification Schedule, and that no further regulatory action is warranted at this time.’  The Commission noted in the ACD that should the Pilot Program remain in effect after March 2022, the Commission would initiate this Mail Classification proceeding … .”

Accordingly, the docket was designed to seek

“… information on the Postal Service’s recent pilot program in which it added to the accepted payment methods, at specifically-identified Post Offices, in order to allow postal retail customers to exchange payroll and business checks for stored value Gift Cards (Pilot Program).  The Commission seeks the information to determine whether the Pilot Program has changed the nature of the Competitive product at issue (Special Services – Greeting Cards and Stationery) to the degree that the Gift Cards price category (or an undefined sub-component) may be categorized as a non-postal product.  A finding that the price category, product, or subcomponent is a non-postal product would require its termination.”

The commission invited comments; six sets were received, including from the Postal Service and Mailers Hub (as reported in the July 18 issue of Mailers Hub News).

There was no reported activity on either the “pilot test” or the PRC’s docket for the remainder of the year.


In the FY 2022 Annual Compliance Determination, issued March 29, 2023, the PRC imposed a reporting requirement:

“The Commission directs the Postal Service to report quarterly information on the Pilot Program and the Gift Card product as a whole.  The report shall be filed in Docket No. MC2022-60 and shall include information on volume, revenue, and costs (which should include training-related costs, labor costs associated with the retail transactions, and supply costs) separately for Gift Cards purchased as part of the Pilot Program and all Gift Cards.  The report must also include whether Gift Cards, both in general and those sold as part of the Pilot Program, are likely to be mailed or otherwise promote the use of the mail (for example, number of Gift Cards purchased in a transaction that included other postal products).  Finally, the report must include any plans for modifications or other future plans of the Pilot Program or Gift Card product, including any plans for termination of the Pilot Program.”

Under that mandate, the Postal Service filed nearly identical quarterly reports on May 10, August 9, and November 9, 2023, and most recently on February 9, 2024.

In each, the USPS reports no change – including “no fee revenue for gifts cards associated with business checks” and that, “accordingly, there were no costs.”  Though it provides data about the sale of greeting cards and conventional gift cards, it maintains that “even had Gift Cards been purchased under the pilot program, the Postal Service would have no direct means to know whether such cards would be entered into the mailstream.”


At this point, nearly thirty months after the “pilot test” began, it and the subsequent PRC docket remain in a zombie state, neither meaningfully active nor officially closed.

Begun after discussions between then-new Postmaster General Louis DeJoy and the American Postal Workers Union, the “pilot test” is inactive, yet the Postal Service maintains in each filing that “no determinations for future plans have been made since the previous update.”

Meanwhile, the PRC has done nothing to respond to the comments it received, let alone pursue its objective under the docket to define the nature of what was being tested and, in turn, require either appropriate action by the USPS to establish it as a product or to end the test. As a result, the PRC has an unfinished docket about an undefined product that continues to be tested despite no activity and without any plan by the USPS to do anything with it.

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