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The U.S. Postal Service saus the non-profit isn't playing by the rules.
The decision to throw away the books wasn't made locally. The Postal Service says it hasn't changed its national policy. It's just enforcing it now.
The Imagination Library doesn't pay for return service on their books, meaning if it's undeliverable, it just goes back to the post office. In some places like Blount County, the local post offices have been keeping the books and volunteers come by and pick them up, but that's not going to be allowed any more.
Herb Meyer is the chair of the Imagination Library for the Kiwanis Club of Maryville, which spends about $55,000 a year to buy and ship books to Blount County preschoolers.
"I'm convinced if a child can't read he's not going to be able to do much in life," Meyer said.
Of the 4,500 books sent out to Blount County addresses each month, Meyer said about 100 come back to the post office.
"They set them aside and they don't have to call us or anything or let them accumulate, we're there every month picking them up," he said.
But just last week, Meyer learned that is no longer allowed anywhere in the country.
"That package is treated as waste if it's undeliverable," said USPS spokesman David Walton. "The books are destroyed."
Walton said if the Imagination Library wants their books back, they have to pay a return service fee like everybody else.
"They were trying to get out of paying that," he said. "The postal service in our last fiscal year lost $15.5 billion, so you know we're watching every penny."
"They're throwing brand new children's books, bought and paid for by local people who are really trying to do a good thing for the kids in their community, they're throwing them away," said David Dotson, president of The Dollywood Foundation which oversees the Imagination Library.
"For the most part throughout our history we've been able to retrieve the books all over country. It's really not been an issue," Dotson said. "In the last 10 years we have generated $14.9 million of revenue for the United States Post Office. We consider ourselves a valued customer."
Dotson said he hopes, with the help of politicians who support the program, they can work out a nationwide policy with the postal service that will allow them to get those undeliverable books back.