'Let's End De Facto Rate Increases,' Mailers Plead

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Five mailers groups petition the PRC to define what constitutes trivial rate increases in operational changes installed by the Postal Service.

Upset over Postal Service procedure in which operational changes translate into de facto rate increases for certain classes of mail, a coalition of mailer associations filed a petition with the Postal Regulatory Commission (PRC) to address the problem yesterday.

At the heart of the group's petition is a desire for the PRC to define the legal term de minimis, literally “trivial,” in relation to changes made in postal operations. Currently, the Commission defers to the Postal Service's estimation of a de minimis increase in rates when instituting a change. Mailers argue, however, that attendant costs that go along with procedural alterations can be exorbitant, or even prohibitive.

One current example is the Postal Service's effort at creating the “perfect bundle” for the Automated Package Processing System (APPS) to minimize costs of broken bundles. “We have situations where certain mailer providers could not afford to make the investment in new equipment needed to create the perfect bundle,” says Joe Schick, director of postal affairs for Quad/Graphics. “It would change the cost structure and outweigh the benefits.”

The petition also asks the PRC to create a rule-making proceeding that would require the Postal Service to file a notice of an operational change and give mailers at least 15 days to respond with their evaluations. Should, based on those comments, the PRC decide that the proposed change will have a greater than de minimis rate effect, the Postal Service should be ordered to file a notice of rate change, say mailers.

“[The Postal Service comes] at you with a proposal: 'This is for efficiency and here's what we want you to do.' That change does not currently require a rate review in terms of what impact it may have on the rate cap,” notes Gene Del Polito, president of the Association for Postal Commerce (PostCom). “They don't even get around to making any determination at all whether it costs the mailers anything. We are asking the PRC to tell the Postal Service, ‘Hey, here's a yardstick.'”

Changes afoot in procedures for the Intelligent Mail barcode and pallets for the Flats Sequencing System could also add to mailers' postal costs above and beyond a CPI rate increase, mailers contend. Groups who took part in the filing of the petition include PostCom, the Alliance of Nonprofit Mailers, the Major Mailers Association, the Association of Magazine Media, and the National Postal Policy Council.

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