Still Waiting for PRC Ruling on Standard Mail Rates

May 03, 2007 1:50 AM  By

With just 12 days left before implementation of the new postal rates, the U.S. Postal Service Board of Governors (BOG) on May 2 accepted the Postal Regulatory Commission’s decision regarding two of its previous rate case recommendations. But the PRC has yet to rule on its reconsideration of pricing for Standard Mail flats — the category affecting most catalogers.

All new rates are scheduled to take effect May 14, except those for periodicals (magazines and newspapers), which become effective July 15. The PRC modified two earlier rate case recommendations: lowering the proposed price of the Priority Mail flat-rate box from $9.15 to $8.95, and extending the nonmachinable surcharge (which encourages mailing efficiencies) to all single piece and presorted First-Class Mail letters, regardless of weight.

As for Standard Mail flats rates, expected to increase by as much as 40%, no date has been announced for the PRC to release a decision. Bob McLean, executive director of Arlington, VA-based Mailers Council, says it’s “most unusual” that this rate case has late revisions and a split implementation date. “This will be very costly for mailers because the key thing to understand is information and the numbers have changed,” he says. “This is a perfect example of why mailers need more time between a rate case decision and the implementation date. All this could’ve been avoided if we had a 90-120 days between the decision and implementation date.”

In related news, four organizations — The Direct Marketing Association, the Association for Postal Commerce, the Mail Order Association of America, and the Parcel Shippers Association — delivered a letter to BOG Chairman James Miller on April 30, requesting a delay of implementation until after July 15 for new postal rates regarding Standard Regular and Nonprofit Mail.

According to the letter, the requested delay would allow for a “reasonable time following the resolution of the Governors’ March 29 decision requesting reconsideration of the PRC-recommended rates for flat-shaped Standard mail.” Although delaying the implementation will result in a modest loss of revenue for the USPS prior to the commencement of the rate case test year, the letter states, “we believe the long-term benefit of a stable Standard Regular and Nonprofit Mail customer base far outweighs any short-term financial losses for the Postal Service.”

Standard Mailers should probably not get their hopes up that the rate hike will be delayed. The PRC on April 27 denied a request from the Coalition of Catalog Mailers (CCM), a group of about 50 catalogers, to delay implementation of the new rates for Standard Mail flats as new testimony was received. But the PRC granted the late notice of intervention filed by the CCM, dismissing the group’s motion to reopen and supplement the record. On April 12, the CCM had filed a motion to delay the new flat rates, claiming new testimony on the difficulties catalog mailers will have adjusting quickly to the new rates could persuade the commission to give mailers more time to prepare for the change.

The CCM was given standing to file comments on the evidence already taken in the case and to reply to PRC comments on that evidence. According to the PRC’s latest ruling, May 4 will be the deadline to file initial comments on the closed record with reply comments due by May 11.