As most of you probably know by now, the Postal Service has seen its exigent rate case rejected by the PRC (Postal Regulatory Commission), and they have since appealed that decision. The proposal would have added approximately $2.3 billion in new revenue for the USPS, with an average price increase across mailing products of 5.6% (a 44 cent stamp would have gone up to 46 cents, for instance). The PRC denied the request on grounds that the Postal Service’s current financial difficulties were not caused by the recent recession, and thus did not justify a price increase beyond the rate of inflation (which is what an exigent rate case is supposed to be based on).
This is a major wrench thrown in the USPS’ plans to attempt to resolve their current financial situation. Postmaster General Jack Potter responded with a statement on September 30th expressing his disappointment and stressed the need to allow the Postal Service flexibility in closing their current deficit emphasizing allowing the “elimination of several legislatively-imposed constraints that hamper our ability to operate efficiently and profitably” and stating that they will be looking at the PRC decision in order to come up with the next course of action which could include an appeal.
However, they have also submitted a proposal for their Shipping Price Change, which if approved, would go into effect on January 2, 2011. These would affect pricing for competitive services, such as Priority Mail, Express Mail and most International mail classes. New services, such as Critical Mail and Regional Flat options, as well as lower volume thresholds for obtaining Commercial Plus pricing incentives, will also be made available.
Stay tuned for updates as the proposal is examined by the PRC and whether and when changes are made official!
Also, visit our USPS shipping and shipping rates page for more news.