A coalition of mailing groups last week called on the Postal Rate Commission to dismiss the U.S. Postal Service’s (USPS) recently-filed rate hike proposal.
Faced with plummeting mail volume it traces to the ongoing recession and increased use of online bill-paying and other transactions, the Postal Service announced last month proposed rate changes that could increase the price of a first-class stamp by 2 cents to 46 cents. The rate hike proposal also includes an 8 percent rate increase for magazine publishers and a 2 cent jump for postcards to 30 cents. The Postal Regulatory Commission must approve the recommended price changes, and the increases would not go into effect until Jan. 2, 2011.
According to the Affordable Mail Alliance, a coalition of more than 700 corporate and nonprofit mailers that together account for a majority of the mail sent in the U.S., the USPS rate hike proposal violates the cost controls Congress put into law to protect consumers. By law, the Postal Service can raise prices to the price of inflation as measured by the Consumer Price Index (CPI). The only exception to the CPI cap is for “extraordinary or exceptional circumstances” that would leave the USPS short of funds to provide necessary services.
The Alliance contends that economic downturns are a fact of life and do not constitute “extraordinary” or “exceptional” circumstances, and that the trend toward online communications has been taking place for 15 years, giving the USPS time to prepare for the decline in volume which it has not.
“Punishing customers with higher prices is not the way to make the Postal Service solvent,” the Alliance said in a statement. “In fact, without effective cost control, trying to make the Postal Service solvent through financial infusions will be like trying to fill a bucket with a hole in its bottom. The Postal Service will lurch from one financial crisis to the next.”
