Postal Rates Lowered

POSTAL RATES LOWERED

Despite the USPS, the President’s budget and some mailers and associations that have supported a continuation of the exigent surcharge of 4.3% on Market Dominant Products, the Postal Regulatory Commission (PRC) issued a decision for the USPS to file a rate rollback which went into effect on April 10.

In what was on ongoing collection of evidence, the PRC did not accept the views of the Postal Service concerning the extent of the harm resulting from the Great Recession and therefore imposed the date of the rate rollback.

It was hoped that the surcharge would remain as part of a potential postal reform package that would help stabilize the Post Service finances. A proposal to keep the surcharge was in the President’s budget as well as in the Ipost bill introduced in Congress by Senator Carper.

Alex Cooper, Special Assistant to Commissioner Mark Acton of the PRC, in a discussion with AAPS members during the recent conference, what influenced the PRC’s decision and cited several factors that would be under consideration over the next year as the USPS regroups for another push at raising the rates in January, 2017. As for now according to Mr. Cooper, the rates as established on April 10 will remain intact throughout the rest of the year.

According to Mr. Cooper, the USPS has several areas from which to raise their revenues included parcels, a service that the Postal Service has been continuing to try and make strides in for the past several years. It should be noted that even though the USPS has experienced rapid growth in package volume over the past few years, it is not nearly enough to offset the decline in revenues from Market-Dominant products such as First Class and Standard Mail.

When asked about the mandatory “Rate Review” that the PRC will be charged with conducting in 2017 (the 10 year anniversary of the Postal Accountability and Enhancement Act) in order to determine how the rate setting process has worked during the previous 10 years, Mr. Cooper acknowledged the possibilitythat the outcome of the review could create more of a basis from which a comprehensive postal reform package could be conceived in the future. However, this being an election year, the prospects of comprehensive postal reform either short-term or long term, remain uncertain.