Boondoggle of Nine-Digit Zip Won’t Go Away

In 1983, the Postal Service officially introduced nine-digit ZIP codes, boldly predicting that by 1988, 90% of first-class business mail would use them. Given the advent of new machines that could read, code, and then sort such mail, and the fact that most first-class mail is business, the program would save the service millions and take the mails into a new age.

Five years later, less than 20% of letter mail bears nine-digit codes. What’s more, the nine-digit ZIP isn’t even necessary: Newer machines can code and sort mail without it.

Therein lies a tale of poor judgment, puffery, rigidity, even malfeasance, that many think put a good chink in the Postal Service’s credibility. It represents the kind of bureaucratic foolishness that makes consumers want to nationalize the post office and the Reagan Administration to “privatize” it.

Before there were ZIPs, there were zones, each for a specific post office--Los Angeles 49, Calif., for example. Then came a Zone Improvement Program (ZIP), with five-digit numbers whose first three digits defined the area (like a telephone area code), and the last two the post office. Thus, Los Angeles 90049 was the Brentwood area of Los Angeles city. (Of 100,000 possible five-digit combinations, 43,000 have been assigned.)

Uproar From Public

The nine-digit code was more precise yet. The first two extra digits defined a sector--a group of blocks perhaps--and the last two a segment, which could be one side of a block, or one big building, or even a floor, if its mail volume justified it. Such numbers, which could be machine-read, allowed mail to be swiftly machine-sorted right down to its destination.

The public reaction was uproar when it was originally announced in 1978 that nine-digit codes would start in 1981. The new ZIPs weren’t required (“Even the five-digit ZIP isn’t mandatory,” says Pam Gibert, general manager of regular mail services for the Postal Service in Washington) but the Service implied that they were, promising to send cards telling people their new ZIPs, and to offer toll-free lines they could call for other ZIPs.

Individuals thought the system sounded onerous; business thought it sounded expensive. Come 1981, Congress ordered the plan postponed until 1983.

By 1983, the code was reintroduced as “ZIP+4,” accompanied by automation and incentives. The Postal Service had 252 optical scanners that could “read” the ZIP codes on 10,000 letters an hour (compared to 1,850 on a manned sorting machine), print a corresponding bar code on the envelope and pass the letter to a bar code sorter. Thus, if it bore the nine-digit code, it could be automatically sorted down to the final carrier route.

Savings Predicted

There were also incentives to get business mailers to use the codes. First-class mailings of at least 500 pieces, for example, that were pre-sorted (bundled in five-digit groupings) and also bore ZIP+4 codes, got a half-cent discount per letter on top of the discount for pre-sorting (currently 4 cents).

The Postal Service was full of predictions again--95% acceptance by 1988, annual savings of $600 million. Postal rates would be contained while mail volume soared.

Still the public resisted: After eight months, only 59 mailers had converted to nine-digit codes. Pre-sorting by five-digit codes was bargain enough, and the extra half-cent wasn’t worth the effort or cost of converting their mailing list.

By 1984, there was new technology--a “multiline” scanner that could read the whole address, not just the ZIP code, and could translate the given street location into the proper nine-digit bar code for sorting. It could thus do the same thing without a nine-digit ZIP that the earlier scanners couldn’t unless mailers provided the nine-digit code. Since few were doing that, the Postal Service’s so-called “single-line” readers were not just obsolete but of limited usefulness. Nevertheless, it ordered another 406.

For several years, the ZIP+4 campaign got pretty bad press. The service kept insisting that everyone would soon use the new codes, justifying the “single-line” scanners. The congressional Office of Technology Assessment, noting that the Postal Service’s standard of research and development was “well below industry averages,” urged “revising current automation strategy” and converting the scanners to the newer form. Even the Postal Services’s Board of Governors urged switching to multi-liners.

Unfortunately, one member of the board was revealed to have taken kickbacks from a firm representing one of the bidders for the contract to make multiline equipment. This cast some suspicion on the board’s urging such equipment, and the whole decision was put on hold.

When the smoke cleared, the Postal Service finally decided to have its order of 406 scanners “retrofitted” to multiline capability--at a cost of about $350,000 apiece over their $500,000 original price tag. These converted machines began arriving at post offices last February.

The nationwide use of ZIP+4 is still minimal. And the service is still trying to sell it with price incentives and the peculiar assertion that converting a mailing list to nine-digit codes offers a great opportunity to clean out old or duplicated addresses.

Oddly enough, the Postal Service isn’t vigorously encouraging mailers to apply their own bar codes on envelopes--the ultimate goal of the process, and something many businesses could do. “The point of the automation is bar code sorting,” says Louis Delgado, staff director of the House subcommittee on Postal Operations and Services. “The nine-digit ZIPs are a detour.”

Even odder, the Postal Service sees nothing wrong with post offices equipped with two expensive machines, one to handle the little bit of nine-digit ZIP mail and the other to handle almost everything else. “They seem to make decisions in a vacuum,” says Delgado, “figuring out what would work for them if everyone does what they want. They don’t figure out the real world.”

Actually, he says, “we don’t have anything against automation. We just want smart automation.”

It may take awhile.