USPS Appeals PRC’s Exigent Case Ruling

The U.S. Postal Service isn’t taking the Postal Regulatory Commission’s Sept. 30 ruling–which denied the USPS’s exigent rate case price request—lying down.

The Postal Service will file a petition in the U.S. Court of Appeals for the District of Columbia Circuit. The petition seeks a review of the PRC’s interpretation of the law that governs how prices can be set under extraordinary and exceptional circumstances.

The USPS claims that the PRC misread the statute and applied an incorrect standard in evaluating the request for an exigent price increase.

“We have a fundamental disagreement with the PRC’s interpretation of the law,” said Postmaster General John E. Potter. “This action is an investment in our future. We need to understand and define the rules under the current law should the Postal Service find itself in a similar situation in the future.”

The USPS is asking the Court of Appeals to confirm its right to pursue the exigent price increase as originally requested of the PRC.

USPS spokesperson Joanne Veto says the court will determine the timetable governing the request. “But we’re asking for an expedited review of the case. We are not expecting a decision this calendar year, though,” she says. “We probably won’t know until sometime around the spring if it isn’t expedited.”

After the USPS files its petition with the Court of Appeals, the USPS, PRC, and other interested parties can file briefs supporting their respective opinions. The court would then schedule oral arguments and consider them, along with the briefs, before it renders a decision.

Any additional action the USPS may take around pricing is not tied to the court’s ruling, Veto says. “If we were to file a price request at the CPI cap or file another exigent case, those decisions are completely independent of our petition before the Court of Appeals.”

Veto says the “incorrect standard” argument from the Postal Service refers to when the PRC misinterpreted language and imposed at least three different requirements on the USPS to obtain the exigent price adjustment, none of which are written in the statute.

“The Postal Service also needs a clear explanation of the rules under the current law that determines pricing should the Postal Service find itself in this situation again,” she says.

If the Court of Appeals rules in favor of the USPS, Veto says, the court would likely return the decision and exigent filing to the PRC to reconsider and further review.

The Direct Marketing Association and member of the Affordable Mail Alliance, “oppose this appeal by the Postal Service and will actively support the PRC decision in court, says Jerry Cerasale, senior vice president of government affairs for the DMA and AMA member. Both groups believe the PRC decision to deny “the inflation-busting postage increase sought by the Postal Service was correct on the law, the facts and public policy,” he says.

What’s more, Cerasale says this appeal by the USPS “will force its customers who were planning to increase mail volumes in early 2011 due to the PRC decision to put a screeching halt to those plans. This is a mail-volume-killing act.”

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