October 22, 2010

Special Bulletin: USPS Appeals Exigency Rate Case

Dear Catalogers, Suppliers & Others With Catalog Interests:

While mailers were still rejoicing over the victory on the exigency rate case, the USPS filed a lawsuit today in the U.S. Court of Appeals to reverse the widely heralded Postal Regulatory Commission decision. The Postal Regulatory Commission on Sept. 30 denied the USPS's extraordinary request for a well-above-inflation-rate postage price increase that would have effectively nullified the Congressionally-imposed rate cap.
In its latest filing, the USPS requests a review of the PRC’s interpretation of the law that governs how prices are set and asks the Court to confirm it has the right to file an exigent price increase. It also seeks clarity regarding the rules governing how an exigency increase will be applied should it find itself in a similar situation in the future. According to a USPS statement on the matter, it is also reviewing other options open to it in light of the PRC ruling.
 
What does this mean to you? Right now, it is a little hard to say definitively. Courts have historically sided with regulators provided it can be demonstrated the regulator followed its own rules and practices in arriving at a decision. We know of no basis to conclude otherwise at this point, indicating the PRC decision should stand. However, clearly USPS execs have an approach they believe has merit, or they would not have gone to the cost and trouble of an appeal.

ACMA's Approach
As it has all along this process, ACMA will monitor developments closely and may decide to intervene alone or with others supporting the PRC decision. Unfortunately, this development puts into question how much you should budget for the coming year. Until further information is available that suggests otherwise, we recommend sticking by earlier forecasts we gave to members, but you can be sure we will stay close to this matter and let you know when a clearer picture is available.

Happily, ACMA has some money available from its Special Fund and general coiffeurs that give us options as to how to proceed. This is a great reason why it is in your best interests to make sure you have a properly resourced group to address unexpected developments quickly to protect your interests.

More to come…
 
Sincerely,
Hamilton Davison
President & Executive Director
American Catalog Mailers Association
www.catalogmailers.org
Direct: 401-529-8183
hdavison@catalogmailers.org