Latest USPS Updates

This is the most recent communication with the USPS and their latest proposal:
Just wanted to give you an update and get your feedback on the following. As you know, the spring mailing season for lives was extremely trying – loss of air transportation with Delta airlines severely restricted the ability of USPS to move lives, coupled with the suspensions of American & US Air, the movement of lives was challenging to say the least. Things have not gotten any better. I received notification last week from US Airways effective October 1; they will no longer accept lives as cargo or mail. This is a result of their merger with America West. America West will manage the partnership and they do not accept lives.
As I’ve mentioned to a few of you on many occasions, I have been involved in negotiations with a cargo carrier to provide much needed lift to the industry, however, this lift comes at a cost. As you know, Northwest Airlines requires a $1.00 surcharge to transport lives. The cargo carrier will require a $.99 surcharge should we contract with them.
They will take lives out of the following markets:
Memphis
Nashville
Jacksonville
Orlando
Honolulu
San Francisco
San Diego
Phoenix
El Paso
Austin
New Orleans
Columbus, OH
Cleveland
Charlotte
Pittsburgh
Philadelphia
Louisville
Anchorage
Seattle
Portland, OR
Denver
Omaha
Kansas City
Buffalo
Albany
Springfield/Hartford
Boston
Fort Wayne, IN
Milwaukee
St. Louis
Richmond
The sites above were provided by each postal area where lift is either limited or non-existent. Where it is limited, the surcharge would apply to all carriers in that market. The cargo carrier only goes to 65 destinations, however, in most cases, they can get your product close to home – USPS may be in a position to truck the remaining distance. Movement of lives on this cargo carrier would be coordinated through their web site – a reservation system if you will. USPS employees would reserve space the cargo carriers’ planes – the lives industry would be required to coordinate shipments with local postal folks.
John C. Bonafilia
Manager, Commercial Air Operations
United States Postal Service
475 L’Enfant Plaza, SW
Washington, DC 20260-7137
202-268-2784

Shipping Survey

August 2, 2005
Dear BSA Member:
As all of us are very much aware 2005 has been, for many of us, a very difficult year to ship our birds. There have been numerous complications – some of which have been solved and others of which still need a great deal of work.
Our organization has been contacted by one of the major airlines. They are interested in the possibility of carrying more of our industries “lives” then they presently have the opportunity to carry. At this infant stage, they are very optimistic about exploring this additional business. I know this sounds very encouraging, and it is, but like everything else in this industry it will take some time to develop.
They have asked us for some information concerning our group’s shipping history which will aid them in deciding the feasibility of such. If you would please take this opportunity to complete the very brief survey below it will be of great benefit to us. I am sorry, but we need to have this survey returned to us prior to August 12th so we can tabulate figures for the airline. Please be as accurate as possible.
Thank you very much for your cooperation in this most important matter.
Sincerely,
Murray J. McMurray, Chairman BSA

SHIPPING SURVEY

Please copy this survey to an email, fill it out and email to survey@birdshippers.org
Please include your name and address.
1) Packages mailed per month?
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
2) Average weight of package?
3) What airport does your Post Office use to ship out your birds?

Lobbyist Update as of June 26th, 2005

Postal Shipping Update
As many of you well know, there has been basically a total melt-down of service of air mail shipments of birds resulting in serious economic problems for shippers of poultry and their customers. Some operations have, in fact, had to cease business as they could no longer make business commitments for timely shipments as well as shipments being delayed causing death prior to delivery or irreversible health problems to the birds even if they arrived alive. Below are some of the problems that cumulatively have resulted in the nationwide problems.
*Delta Airlines unilaterally announced to the USPS that it would not longer take transfers of lives. You could ship from A to B but not A to B to C. Although the USPS is looking at the matter as being in conflict with its contract with Delta to take air mail, as a practical matter such service no longer exists from Delta as it has dismantled its hubs. To “fill the gap,” USPS contracted with Airborne to take “lives.” Airborne, in turn, subcontracted with Northwest Airlines (NW) to carry lives from various cities throughout the country. [NW already had a separate contract with USPS to carry lives from Minneapolis-St. Paul and Detroit under a surcharge arrangement. NW dropped its previous airmail contract since its share of the airmail market went from 12% to 2% under a bid contract policy that replaced negotiated contracts]. Somehow the negotiations for that service did not materialize and NW is not carrying lives for Airborne, although negotiations are still “in the works.”
*U.S. Airways and American Airlines had their respective air mail contracts temporarily suspended due to poor service. A test period was imposed to seek improvement of service. Although the service has improved, the full service from these air lines in still not in place.
*Recently, USPS issued a directive for Express Mail stating that shippers of lives had to go to certain cities to send their shipments rather than just going to their local post office. BSA is pleased to report that as of June 24th, this policy has been terminated due to the extreme hardship imposed on shippers.
*As in the past, airlines have notified the USPS that they will not carry lives when the temperature reaches 85 degrees F. Although the industry and the Department of Agriculture have informed the airlines and the USPS that that standard should not apply to day old chicks, USPS and the airlines ignore the science based conclusions.
*Insurance of shipments is not consistent. Shippers have had claims denied because the birds arrived late but alive but subsequently died. Shippers have been denied insurance at one post office but were able to obtain it at another.
*Shippers cannot guarantee that they will be able to ship to certain zip codes as it changes from week to week. The “reason” is that the USPS is notified by the airlines the equipment available on given routes at given times. Some of the smaller aircraft will not accommodate lives.
*One of the biggest problems involves Federal Express (FedEx) that took over the Eagle Service previously run by the USPS. FedEx took the legal position that it was not covered by the statute that states, inter alia, that “the Postal Service may require any air carrier to accept as mail shipments of day-old poultry and such other live animals as postal regulations allow to be transmitted as mail matter. The authority of the Postal Service under this subparagraph shall not apply in the case of any air carrier who commonly and regularly refuses to accept any live animals as cargo. [Emphasis added]. 39 USC § 5402(d)(2)(A). FedEx maintains that it “commonly and regularly” refuses “accept any live animals as cargo.” Id. Factually, this is not true as FedEx does carry all types of animals except dogs and cats. In fact, if one goes to the FedEx website, there is a number for the Live Animal Desk! The USPS, however, did, in fact, contractually exempt FedEx from the statutory provision.
Where do we go from here?
BSA has made contact with Members of the Congress looking toward assistance in resolving these problems either administratively or legislatively. In addition, meetings will be held with industry representatives, the USPS and Congressional representatives. We are looking for more that a “band aid” fix; rather, a permanent solution so 2005 shipping season will not be repeated.
The U. S. Constitution and the statutes enacted by the Congress mandate and guarantee that postal patrons receive “prompt, reliable and efficient” postal service “to all communities.” The is not the case in the current situation as it relates to the postal patrons within the poultry and game bird industry throughout the country but BSA will make every effort to “make it so.”
Stephen Boynton, Lobbyist

Transportation Update as of June 6, 2005

According to the U.S. Postal Service (USPS) the following is transpiring:
1. American Airlines and U.S. Air are still in a test mode to determine if they will retain their respective air mail contracts that were temporarily terminated for poor performance. Results are encouraging and a decision by the USPS on American will be made in mid-June.
2. A proposal from a cargo carrier for the transport of “lives” throughout the country has been received – rates are lane specific. It is being evaluated as to where they can best be utilized and a meeting with the carrier and USPS is scheduled for June 17th.
3. Northwest Airlines has a separate contract with the USPS to carry lives from Minneapolis-St. Paul (MSP) and Detroit (DTW) at a $.80 per pound additional surcharge. It signed a subcontract with Airborne for carrying “lives.” They began their five (5) city test on May 28th and expand cities in thirty (30) days. The five (5) hubs are: Minneapolis-St. Paul (MSP), Detroit (DTW), Memphis (MEM), Los Angeles (LAX), & San Francisco (SFO). [Note: Airborne does not currently accept “lives,” however, they are reconsidering their position. If Airborne does accept lives it will open up a very large area for our transportation of “lives”].
4. Delta unilaterally determined it would not take transfers of airmail. It would ship from A to B but not A to B to C. BSA believes that this decision is in conflict with the legislation that BSA was instrumental in obtaining that basically says that “if you tote the mail by air, you tote all the mail to its destination.” USPS informs BSA that it is looking into the legal aspects of the policy.
Steve Boynton, Lobbyist

Transportation Update as of April 18, 2005

According to the U.S. Posatal Service the following is transpiring:
1. American Air is back to about 60% of their network volume and the results are very encouraging. They’re ramping up their transfer operation through Dallas/Fort Worth this week and will be fully ramped up in another 3 weeks – this will provide additional opportunities for the transport of lives.
2. A proposal from a cargo carrier for the transport of lives throughout the country has been received – rates are lane specific. It is being evaluated as to where they can best be utilized.
3. Northwest signed with Airborne. They will begin transporting mail out of their 5 hubs beginning May 14th. We hope they will expand to other hubs later. These 5 hubs are: Minneapolis, Detroit, Memphis, Los Angeles, & San Francisco.
4. US Air is in the first week of their test – results are encouraging as well. As they bring up more markets the options for the transport of lives will increase. They will start taking lives out of Syracuse on April 23rd.
5. Airborne doesn’t accept lives today, however, they are reconsidering their position. The USPS is cautiously optimistic. If Airborne does accept lives it will open up a very large area for our transportation of lives.

Update: American, US Air, NW, & Airborne

Hey, we’re making progress.
We realize how tough things have been out there for many of you in the poultry shipping world these last few months. However the most recent update from Mr. Steve Boynton, our lobbyist, is very encouraging. Here is what is transpiring between the USPS and its air carriers:
1. American Airlines is in its third week of an eight week test. (The USPS pulled their contract earlier and has now reinstated them under some restrictions.) According to Mr. John Bonafilia, of the USPS, the “early results are encouraging.”
2. On April 8th, mail was tendered to U.S. Air for its test. (U.S. Air’s contract was pulled at the same time as American’s.) “The first two days were encouraging.”
3. Northwest Air, which currently has a separate contract with the USPS to carry lives at a $.80 per pound additional surcharge, is actively carrying lives from Minneapolis and Detroit. The USPS reports Northwest has signed a contract with Airborne to start taking lives on May 14th from presumably Memphis, Los Angeles, and New York. (These cities have not been confirmed by the USPS but it is believed by us that these cities will be served.)
4. The USPS is currently in negotiations with a cargo carrier to take lives out of markets where limited commercial lifts however, costs may be a factor here. We were informed by the USPS they will know more in two weeks on this issue.
In conclusion, Mr. Boynton adds, and I quote,
“This latter message (Number 4 above) is really a two edged sword: Firstly, it is encouraging that efforts are being made to expand the service, but, secondly, the USPS does not seem to acknowledge that it has an unequivocal Constitutional and statutory duty to provide mail service to postal patrons. The law does not say that the government, through the USPS, will provide service unless it is too costly, or basically, too much trouble.”
Thank you all for your continued financial and moral support in these most crucial issues.

Grassley’s press release and letter to the USPS

Good morning everybody.
For years America’s hatcheries and family farmers have relied on the United States Postal Service to safely and efficiently deliver live, day-old poultry. They continue to use this effective delivery method because of legislation passed by the U.S. Congress a few years ago.
The new law does not allow air carriers to discriminate against live chicks. If the carrier provides shipment for any live animals, it must provide the service for day-old chicks.
I’ve recently been notified of failures to comply with the new law. A couple of airlines have announced procedures that resemble the problems that caused Congress to pass the law in the first place.
The Postal Service is setting a dangerous precedent if it allows any air carrier to unilaterally make policy changes contrary to existing law. The decision by airlines to limit or eliminate air transportation for live chicks could devastate, if not destroy the hatchery industry and I will do everything I can to support Iowa’s hatcheries.
Because of these allegations, this week I’m sending a letter to the Postal Service to look into possible noncompliance with the law.
Grassley’s letter:
April 5th, 2005
Paul Vogel, Vice President
Network Operations
United States Postal Service
475 L’Enfant Plaza, SW
Washington, DC 02060-7100
Dear Mr. Vogel:
Considerable time has passed since Congress enacted the provision in 39 USC §5402(d)(2)(A) requiring air carriers to accept as postal matter air mail shipments of day-old poultry and other animals as postal regulations will permit. This statute, as implemented, indeed, saved the poultry and game bird producers from a catastrophic economic crisis, if not a total collapse of the industry.
Representatives of the industry have kept me informed as to the implementation of the new law as it pertains to the service you provide to producers as well as to their customers. I am grateful that the United States Postal Service (USPS) has attempted to resolve many individual problems that have recently arisen.
However, I am disturbed by recent developments that seem to be systemic failures. Delta Airlines decision to not carry air mail if it involved a transfer and United Airlines announcement that it would not carry live chicks between Dallas and Denver seem to resemble the problems that caused Congress to pass the law. These actions are clearly in conflict with the statute that does not allow an air carrier to unilaterally modify its policy regarding “when, where and what” it will transport by air mail.
I am certainly mindful that the problems regarding U.S. Air and American are not directly involved with these types of adverse “unilateral declarations” and the USPS is to be commended in demanding appropriate air mail service from these air carriers. However, the problem caused by no air mail service from U.S. Airways and American Airlines are exacerbated when Delta, and to a limited degree United, fail to comply with the law that is seemingly not being enforced by the USPS.
The Postal Service is setting a dangerous precedent if it allows any air carrier to unilaterally make policy changes contrary to existing law. The decision by airlines to limit or eliminate air transportation for live chicks could devastate, if not destroy the hatchery industry.
The Constitution and the statutes enacted by the Congress are designed to insure that postal patrons receive “prompt, reliable and efficient” postal service “to all communities”. I do not believe this is the current case as it relates to the postal patrons within the poultry and game bird industry throughout the country.
I look forward to your response.
Sincerely,
Chuck Grassley United States Senator

Senator Grassley Press Release

Tuesday, April 5, 2005
Senator Charles Grassley, R-Iowa, held a press conference this morning acknowledging his concern that the USPS is not enforcing the law which he introduced in 2002. As he stated, “This law does not allow air carriers to discriminate against live chicks. If the carrier provides shipment for any live animals, it must provide the service for day-old chicks”.
A formal letter was sent by the Senator to Mr. Paul Vogel, Vice President Network Operations of the USPS discussing this and other similar matters. An update will be presented here as soon as more details are known.

March 15, 2005 Update

Dear BSA Member:
As of yesterday, the following is the situation on air mail of lives:

I. THE PROBLEMS

Delta Airlines: As earlier reported, Delta unilaterally decided (for economic considerations), that it would no longer take “live” air mail shipments of if such shipment would mean a transfer in the shipment. In other words, you could ship from A to B but not to C if the shipment required a transfer from B.
American Airlines and U.S. Air: Due to sub-performance in their contracts with the USPS, the USPS temporarily suspended the contracts with American and U.S. Air.
United Airlines: It has been learned that United will not take “lives” from Dallas to Denver.
II. THE “Solutions”
In order to “take up the slack” from the above situation, USPS has contracted with Air Tran and Airbourne. Airbourne, in turn, has contracted with Northwest Airlines to carry “lives.”
Northwest currently takes “lives” under a direct contract with USPS from Detroit (DTW) and Minneapolis-St. Paul (MSP) and, by April 18th, Northwest will be taking “lives” from all it other hubs: Memphis (MEM), Los Angeles (LAX), and New York (JFK). A surcharge will be imposed of $.20 per pound from all hubs except Detroit and Minneapolis-St. Paul where it will continue the current surcharge rates. Northwest is to submit its routing to the USPS by the end of the week.
It turns out that Air Tran does not (will not?) take “lives.” John Bonafilia informs me that Air Tran admits it “misled” the USPS on this issue.
The USPS was unaware of the United refusal to take “lives” from Dallas to Denver but will investigate.
American will be back to carry air mail starting next week for a four (4) week test. Initially, the USPS would not allow them to take “lives” during a test period. I (respectfully) requested that it reconsider this decision due to the critical economic impact the absence of air mail service has had on the industry. The USPS changed its position and American will be required to take “lives” during this test period.
U.S. Air is now “not ready” for the test period but will be by April 2nd.
III. LEGAL ISSUES
The unilateral decision by Delta not to take transfers is clearly in conflict with the statute we successfully obtained. This was pointed out to the USPS that responded with the statement that their attorneys were “looking into it.” As a practical matter, Delta started to dismantle its transfer facilities beginning in March. It has to be concluded it did so with either the tacit approval of the USPS or the perceived or certain knowledge that the USPS would do nothing about it. I fear the same may be true of the United situation.
Of course, there is still the FedEx issue that it was covered by the statute but, even so, the USPS contractually allowed it not to carry “lives.’
IV. CONGRESSIONAL ASSISTANCE
I met with the staff of Senator Charles Grassley yesterday.
Firstly, apparently, the Senator’s office had out considerable pressure on Northwest to do what it has done by some “trade off” on other agriculture issues.
Secondly, it is agreed that the problems (with the exception of sub-performance by American and U.S. Air) are clearly systemic from USPS’s failure to enforce the provisions of the statute. (i.e., FedEx, Delta and United).
Thirdly, in view of these conclusions, I was requested to draft a letter for Senator Grass signature to the USPS (Vogel) indicating his displeasure with the current state of affairs that are mainly the fault of the USPS in its failure to enforce it authority under the statute (or, in turn, using its discretion to not enforce it per FedEx).
Fourthly, after a letter of explanation from the USPS that will undoubtedly be unacceptable the USPS will be “invited ” to come to the Senator’s office for a “chat.” At that time, the FedEx issue will “be on the table” and if the USPS will not remove the clause from the FedEx contract and require FedEx to carry “lives,” it will be informed that legislation will introduce to insure that it be done.
[FedEx had expressed the notion that if it were required to carry "lives" as air mail, it would not carry any air mail. Initially, the Senator Grassley's office was concerned with that threat viz-a-viz the carrying of medical products. This was of specific concern to the Senator as he is Chairman of the Senate Finance Committee that has jurisdiction over Medicare. The Senator now believes that the threat was, and is, a bluff so he does not have any hesitation in going forward].
Fifthly, in view of the surcharge issue, the Senator’s office will look into some form of establishing parity in the market place for those shippers that have to pay the surcharge. The initial thought was to craft some form of a tax credit scheme. This will be pursued.
V. CONCLUSIONS
I really believe that the USPS is attempting to be responsive to the current problems. Having acknowledged that notion, most, if not all, the problems have, in point of historical fact, been caused by the USPS:
1. by eliminating the USPS owned and operated Eagle Service and replacing it with contract service that will not carry “lives” in the face of the statute and facts that required an air carrier to do so;
2. by compounding the this failure by specifically contracting with the carrier that it does not have to do so;
3. by having bid contracts for the carrying of air mail rather than negotiated contract; and
4. by “permitting” Delta and United to unilaterally decide to alter its policy on how it will carry air mail.
From the very beginning of the problems, it was clear that the USPS believes it is held hostage by the air carriers and has consistently deferred to them. The air carriers have, in turn, evidenced to the industry that they “are in control.” The air lines and the USPS (let alone the animal rights crowd) never thought the statute would pass the Congress. Although the passage of the statute (temporarily) “made believers” of the USPS and the air line industry, it is clear that it is time to legislatively make it abundantly clear to the USPS and the air lines that the air mail service the industry is entitled to under the Constitution and statutory law shall be available. Fortunately, we have an “800 pound Congressional gorilla” to help in obtaining this objective.
Sincerely,
Murray McMurray
Chairman

February 16, 2005 Update

Dear BSA Member:
As many of you may, or may not, know, this past week has presented more potential problems for those of us shipping poultry across the country.
Delta Airlines has made the decision to take no “Transfer” mail. Transfer mail consists of mail which Delta would carry from point A to point B and then have to transfer to point C. It is our understanding that they still will carry mail from point A to B (there was no transfer involved).
US Air and American had their postal contracts terminated by the USPS because their service was unacceptable. Both airlines want to continue to have contracts and the USPS is in negotiation with them at this time.
Our lobbyist has indicated to us he should be able to give us an update at the end of this week and we will pass it on at that time. This is very crucial time in our industry. If you have not paid your membership fees yet please consider doing so.
Sincerely,
Murray McMurray
Chairman