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The modern zip code idea began in 1962 and was put into minimum use in 1963 on July 1. The name ZIP is an acronym for Zoning Improvement Plan. The original coding assigned a five digit code to cover every address in the country. The first number was a broad geographical area with 0 beginning in the Northeast and 9 ending in the far West. The next two digits refined the general are to smaller regions that had major transportation access. The last two digits narrowed the area to smaller post offices or postal zones in larger cities. Initially, use of the new code was not mandatory for anyone, but, in 1967, the Post Office required mailers of second and third class bulk mail to pre-sort by ZIP Code. Although the public and mailers alike adapted well to its use, it was quickly obvious that the idea was not enough.
In 1983, the US Postal Service (formerly The USPO) began using an expanded ZIP Code called "ZIP+4." A ZIP+4 code consists of the original five digit ZIP Code plus a four digit add-on code. The four digit add-on number identifies a geographic segment within the five digit delivery area, such as a city block, office building, individual high-volume receiver of mail, or any other unit that would aid efficient mail sorting and delivery. Use of the four digit add-on is still not mandatory as of 2013, but it helps the Postal Service direct mail more efficiently and accurately because it reduces handling and significantly decreases the potential for human error and possibility of misdelivery. It also will lead to better control over USPS costs and, in turn, postage rate stability. ZIP+4 is intended for use primarily by business mailers who prepare their mail with typewritten, machine-printed, or computerized addressing formats that can be read by the Postal Service's automated scanners during processing. Mailers who qualify receive a rate discount on First-Class, non-presorted, ZIP+4 mailings of at least 250 pieces and on presorted ZIP+4 mailings of at least 500 pieces. There are also ZIP+4 discounts for bulk business mail.