NEMOA | News Detail
| PRC Approves USPS Exigent Rate Increase In Split Decision, PRC Approves Full Postage Exigent Rate Increase; Limits It To 2 Years Exigent Increase Approved In Split Decision, PRC Approves Full Postage Exigent Rate Increase; Limits It To 2 Years Dear Industry Participant: It pains me to have to break such grim news especially on Christmas Eve, but despite an all-out mailing industry full-court press to convince the Postal Regulatory Commission (PRC) the USPS's request for an exigent rate hike was ill-conceived and failed to demonstrate true "exigency," the PRC approved the full 4.3% increase to be added to the 1.6% CPI-capped increase. Both will take effect at midnight on January 27th. "The Commission’s decision closely follows the law we are charged by the President and Congress to uphold," said PRC Chairman Ruth Goldway in a statement. There is, however, one bright spot in the PRC ruling. The PRC put a limit on the exigent rate increase of up to two years, per the following excerpted from the ruling: Allowing the rates to remain in effect indefinitely would result in over recovery of the financial impact of the Great Recession on the Postal Service. The rates proposed by the Postal Service will enable it to recover the lost contribution in less than two years. The Commission finds the Postal Service proposal to collect this rate adjustment indefinitely inconsistent with the fundamental policies underlying the price cap. Under the price cap, the Postal Service is expected to respond to declining volumes by reducing costs and improving efficiencies. Although the Great Recession accelerated volume decline, it does not eliminate the Postal Service’s obligation to respond to revenue losses by reducing costs or improving efficiency. Consequently, the Commission must determine an appropriate end date for collection of the exigent rate adjustment. The Commission directs the Postal Service to report quarterly on the revenues generated by these rates, and to develop a plan to phase out these rates once they have produced the revenues justified by this request. Click here for the full PRC order. Click here for the PRC press release. ACMA continues to review the ruling to consider our range of options, and will be available to answer any member questions. Needless to say, we're very disappointed. Sincerely,  Hamilton Davison President & Executive Director American Catalog Mailers Association www.catalogmailers.org hdavison@catalogmailers.org  ### About ACMA ACMA is a Washington-based not-for-profit organization specifically created to advocate for the unique collective interests of catalog mailers in regulatory, public and administrative matters where the shared impact transcends individual company interests. The only catalog owned and controlled trade group focused solely on the business interests of catalogers and their supply chain, ACMA participates in rule-making and other proceedings of significance where a single collective voice increases influence and effectiveness. Membership is open to any party with direct interests in the catalog industry. More information can be found at www.catalogmailers.org. Published: 12/24/13 |