Breast Cancer Research Stamp:

Millions Raised for Research, but Better Cost Recovery Criteria Needed

T-GGD-00-137: Published: May 25, 2000. Publicly Released: May 25, 2000.

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Pursuant to a congressional request, GAO discussed the Breast Cancer Research Semipostal (BCRS), focusing on the: (1) appropriateness and effectiveness of the BCRS as a fundraiser; and (2) costs associated with developing and selling the BCRS.

GAO noted that: (1) the Stamp Out Breast Cancer Act directed the U.S. Postal Service to create the BCRS, the first ever semipostal in the nation's history; (2) the BCRS sells for 40 cents--with 33 cents covering the First-Class postage rate; (3) after recouping its reasonable costs, the Service is to remit the net surcharge revenue to the National Institutes of Health and the Department of Defense for breast cancer research; (4) the public and a majority of key stakeholders GAO spoke with believe it is appropriate to use semipostals issued by the Service to raise funds for special purposes--such as breast cancer research; (5) the Service, although supportive of the BCRS, is generally opposed to semipostals because the Service believes them to be outside its mission; (6) in GAO's opinion, the BCRS has been an effective fund-raiser; (7) it has raised millions and, at the same time, has been convenient and voluntary; (8) by the time BCRS sales conclude on July 28, 2000, the Service estimates it will have raised about $14 million for breast cancer research; (9) the average monthly surcharge revenue generated by the BCRS compared favorably with 7 of the 12 foreign semipostals included in GAO's survey, although it did not raise as much money as most of the foreign semipostals on a per capita basis; (10) it is not clear how much it cost the Service to develop and sell the BCRS; (11) the Service reported that the bulk of its costs, through the end of 1999, were about $5.9 million; (12) according to the Service, about $5.4 million of those costs were recovered through the 33-cent First-Class portion of the BCRS, and the remaining $482,000 had been recouped from surcharge revenue; (13) throughout the review, GAO was concerned that the Service had not formalized its criteria for determining what costs would be recouped from the BCRS' surcharge revenue and was not consistently applying its informal criteria, which changed over time; (14) GAO recommended that the Service formalize and consistently apply its cost recovery criteria, and in response to that recommendation, the Postmaster General said the Service would do so shortly; and (15) according to the Postmaster General, the Service planned to recoup costs from the surcharge revenue that were over and above the costs normally incurred with a blockbuster commemorative stamp issue or new postal product.

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