Adding Advertising to your Nonprofit Newsletter

  Regular (commercial) Standard Mail is sometimes referred to as “Bulk Mail” and “Advertising Mail.   Nonprofit Standard Mail is used by nonprofit organizations to communicate, educate and to raise funds for charity.  Nonprofit Standard Mail advertising must be “substantially related” to the nonprofit’s primary purpose, for example a church selling bibles.   Nonprofits can also mail unrelated low cost items (under $9.70) or gifted or donated items  (This amount is determined by the IRS and tends to change slightly higher every year.)
 
  There is a legal exception allowing unrelated general commercial advertising in Nonprofit Standard mail newsletters (or bulletins).   If the newsletter has characteristics of a periodical, it may carry general advertising (except “T-I-F” ads, explained below).   These are determined by the content requirements of a periodical (note: not the same as the actual Periodicals Class of mail).

Content Requirements of a Periodical:
 
  Have a Title
  Published at regular intervals at least 4X per year
  Formed of printed sheets
  Consist of at least 25% editorial or non-advertising (with a maximum of 75% advertising)
  Have and identification statement including…
     a) Publication title (may appear on the cover instead)
     b) Issue date (may appear on the cover instead)
     c) A statement of frequency
     d) Issue Number (consecutive in a series)
     e) Subscription price, if applicable (optional)
     f) Name & address of known office of publication

  It is not difficult to upgrade your nonprofit newsletter or bulletin to meet these requirements. Your local U.S. Postal Service Business Mail Acceptance (or Business Mail Entry) staff can help.

  Some newsletters carry paid “sponsor” listings instead of regular advertising.   These are allowable, even with the sponsor’s business logo, without the content requirements mentioned above.   However, if the listing includes contact information like mailing address, phone number or email, then it is an ad, regardless of the size or format, assuming there is financial support related to the listing.   If the sponsor’s contact information is included, the newsletter must meet the content requirements described above.

  In general, advertising may be placed anywhere in the newsletter, excluding the labeling and title areas.  The back cover of a newsletter can be used, even if in full exposed view when delivered.   Ad size is not restricted except by the dimensions of the newsletter.   

  Standard Mailings (nonprofit or regular) must have a minimum of 200 pieces of mail.  They have to at least be manually sorted and entered at the Business Mail Entry desk of the local Post Office.   Postage is paid by permit requiring a $185 annual fee.   An indicia is pre-printed and boxed in the upper right of the envelope with the words: “NONPROFIT ORG., U.S. POSTAGE PAID, (NAME OF TOWN & STATE ABBR.), (PERMIT NUMBER).”   The mailing permit is just an accounting system to pay postage.  Some nonprofits use their printer’s permit.  A separate “nonprofit authorization” is required to establish eligibility to use the nonprofit rates.  To apply, ask for USPS form 3624. The authorization is continuous if used at least once every two years, if your nonprofit status with the IRS does not change.

  If the nonprofit chooses not to exercise the right to use Nonprofit Standard Mail rates, it can always mail at the regular (commercial) rates.   A monthly 1 ounce, 500 piece letter-sized bulletin (12 pages maximum) costs $600 more per year when mailed at Regular Standard rates, or $1,625 more mailed First Class, compared to Nonprofit Standard Mail rates.  [Current postage assumptions (note these can change): 1st Class 1-oz. piece rate = 44¢;  Regular Standard Mail piece Automation-compatible Area Distribution Center (AADC) rate (under 3.3 oz.) = 27¢;  Nonprofit Standard Mail Automation-compatible AADC rate (under 3.3 oz.) = 16.9¢.]

  Even if a newsletter or bulletin meets the content requirements of a periodical, it must exclude TIF advertising.   TIF stands for Travel, Insurance and Financial Instruments.   It is easier to remember “TIC,” substituting “C” for Credit cards, because Financial instruments is too broad a term.   Mortgage rates and certificate of deposit rates are allowed, for example.  Credit card and debit card ads, including a nonprofit’s affinity VISA card, for example, are not.   You may offer payment options by MasterCard, VISA, or American Express, for example, but may not use adjectives to describe how to facilitate payment.   You may not say “As an option use your low-rate (nonprofit organization’s name) VISA card to pay your dues.”

  TIC is only a Nonprofit Standard Mail restriction.   If you mail under the Nonprofit Periodicals Class, like The Elks Magazine, National Geographic, or a few large-Lodge news bulletins, TIC does not apply.   And it does not apply if you mail at Regular Standard (commercial), or First Class rates.

  The definition of travel has recently been expanded to mean travel arrangements.   Restricted travel ads include all implied or stated elements of transportation, accommodation, and destination.  Day trips are excluded from this definition.   General “image” ads for United Airlines or Amtrak are allowed.   A hotel ad without the transportation or destination component is allowed.   These ads are restricted only when all three are combined.   Now, a nonprofit organization can promote discounted air or hotel rates for their convention because that travel is substantially related.    Cruises tend to be suspect because recreational activity is predominant—even if a “primary purpose” event is on the agenda.   Generic business card ads for travel agents are considered ads for all travel arrangements they promote, so they are restricted.    Articles containing elements of transportation, accommodation and destination are restricted just as display ads with graphics and a nice layout.

  Insurance ads are generally restricted, including business card ads for insurance agents.   The only qualifying ads are for policies not generally commercially available.   The Postal Service believes that almost all insurance—even insurance packaged for special groups—are generally commercially available, even if rates and features of the plan might differ.   A District Court ruling recently challenges Postal Service interpretation, and the Aid Association for Lutherans/Lutheran Brotherhood (now called “Thrivent Financial”) won a case against the USPS, so watch for possible easing of this restriction in the future.

  In general, it is wise to check with USPS Business Mail Acceptance (or a Supervisor at Business Mail Entry (BME)) before printing anything new with regard to advertising content.   Interpretations can vary depending on your contact.   If you are advised that your content is prohibited, consider contacting any of the nonprofit mailing associations (DMA-Nonprofit Federation or Alliance of Nonprofit Mailers) or Industry Postal Customer Council Representative.  If there is a dispute over the regulations, BME is instructed to accept the mail and refer it to the USPS Inspection Service, rather than delay it for review. 

  Keep in mind, the regulations discussed above are periodically updated.  

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P.S. Please consider printing ADDRESS SERVICE REQUESTED near the address label of your newsletter to comply with USPS Move-Update regulations for First Class and Standard (Nonprofit and Regular) Mail.  Non-compliance for not using this or a substitute method to update your mailing list could cost you up to 7¢ extra per bulletin mailed.