PRC Rejects Standard Mail Price Increases

The Postal Regulatory Commission (PRC) has returned proposed rate adjustments to the U.S. Postal Service for review, saying the agency’s requests failed to comply with legal requirements, such as keeping increases under the inflation rate determined by the Consumer Price Index (CPI). The proposed rate changes covered Standard Mail, Package Services, and Periodicals.

In an order released today, PRC Acting Chairman Robert Taub and four commissioners said they shared the concerns of public commenters, such as the American Catalog Mailers Association and Valpak, that the Postal Service’s filing contained a large number of errors and omissions.

Under Standard Mail, the PRC determined that certain unequal commercial and nonprofit discounts and workshare discounts were in conflict with precedent set in the 1981 case of National Easter Seal Society v. USPS.

For example, the Commission found several unequal commercial and nonprofit drop-ship discounts that were not reported by USPS, such as a destination network distribution center (DNDC) entry discount for commercial Automation 5-Digit Letters of $0.035 and a discount of $0.034 to nonprofits for the same class of mail. In comments to PRC, the Alliance of Nonprofit Mailers referenced the Easter Seal Society case to urge that USPS equalize nonprofit and commercial discounts.

The PRC’s order also asserts that the Postal Service incorrectly adjusted several billing determinants associated with Flats Sequencing System prices for periodicals, bundles, sacks, and pallets and failed to provide the Commission with the data necessary to calculate the actual average price increase for the Periodicals class. Additionally, the regulatory body ruled it lacked information needed to calculate the average price increase for Package Services.

PRC commissioners stated that the Postal Service rushed the request process without providing due time for comments from concerned parties. “A filing that is incomplete and riddled with errors makes it virtually impossible for the public to provide meaningful comments and for the Commission to complete its review within the statutory time period,” read the order.

The Postal Service must file its amended notice with the PRC no later than March 12 so that new rates that comply with applicable legal requirements can be reviewed and implemented, as planned, on April 26.

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