Leadership Letter
September 2021
ASK COUNSELOR TARA
ASCE’s General Counsel Tara Hoke responds to legal questions posed by Sections and Branches here each month. Send Tara an email with your question.
Can an ASCE Section qualify for reduced nonprofit postal rates?
In recognition of the public benefit provided by charitable organizations, federal and state governments provide a number of benefits to organizations whose operations are dedicated to such public-minded endeavors. The most significant of these benefits is provided in section 501(c)(3) of the Internal Revenue Code, through which organizations operated for educational, religious, or charitable purposes may be exempt from payment of income taxes on income generated in performing these services. But another significant benefit – particularly for organizations that distribute printed newsletters or similar mailings on a regular basis – is the ability for qualified organizations to receive discounted postage rates on eligible mailings.
Publication 417 of the U.S. Postal Service describes the eligibility requirements for organizations wishing to receive reduced rates on standard mailings. In general, eligibility entails two separate elements: First, the organization must be approved by the USPS to take advantage of the rates, and second, the organization must agree to comply with a number of provisions involving the form and content of its mailings.
With regard to the first requirement, the USPS specifies that a qualified entity must be organized and operated primarily for one of eight purposes: scientific, educational, literary, religious, agricultural, fraternal, veterans, or charitable. As a 501(c)(3) exempt organization, organized for scientific, educational, and charitable purposes, ASCE is a qualified organization under USPS regulations – as are its sections, each of which is organized for the same purpose and operates under a 501(c)(3) exempt status, either through ASCE’s group exemption or from individual IRS approval.
As to the mailings themselves, the organization is expected to comply with USPS regulations concerning the types of mailing permitted under these reduced rates. The organization must identify itself properly on the envelope as well as in its contents, the mailing must meet set minimums in terms of size and other criteria (e.g., mailings of 200 pieces or 50 pounds, rather than a handful of letters), and it may not include any ineligible products or advertisements (for more information, download https://pe.usps.com/cpim/ftp/pubs/pub417/pub417.pdf). Above all, the mailing must comprise the qualified organization’s own material. Approval for reduced postage is a strictly reserved privilege, and qualified organizations may be subject to harsh penalties for lending or selling their privilege for use by another organization.
Applications for nonprofit postal rates may be found at your local post office or on the USPS website. Most ASCE sections, as unincorporated subsidiaries of ASCE, will be required to provide the following materials as part of their application: 1) a copy of ASCE’s group exemption letter; 2) a copy of the section’s bylaws, along with a letter from a section officer certifying that the copy is a complete and accurate copy of the original; and 3) financial statements or other materials documenting the group’s present and future operations.