Money & Business

USPS Delays Decision on Price Increases for Mass-Mailers

By / Sep 6, 2013 (iStockphoto/Thinkstock)

A proposed “exigent” increase in U.S. postage rates has drawn opposition from direct mail and publishing industry groups. But a delay on the decision has bought them some time.

It’s no secret: The U.S. Postal Service is hurting financially these days. But one potential remedy has many associations wary of what could happen next—and they’ve joined forces to fight it.

More details on the “exigent” rate increase:

The issue: With the Postal Service cash-strapped and ideas to help cut costs (such as eliminating Saturday mail delivery) meeting with public criticism, the USPS has in recent weeks considered increasing postal rates, on both regular first-class mail (currently 46 cents) and magazine mailers (27 cents). The Postal Service is considering boosting the cost of postage by as much as 10 percent across the board—more than normally would be allowed, as rate hikes are currently limited to the consumer price index. A 2006 law allows the USPS Board of Governors to request larger “exigent” rate increases under extreme circumstances such as terror incidents, according to AdWeek. Such a request must be approved by the Postal Regulatory Commission.

Groups come together:  The Affordable Mail Alliance, a coalition of organizations significantly affected by mail service changes—including MPA-The Association of Magazine Media, the Direct Marketing Association, and the National Newspaper Association—are fighting the exigent rate increase. At the end of August, the coalition sent a letter to the Postal Board of Governors encouraging continued work with Congress on postal rate reform. “AMA believes an exigency increase would not only be profoundly ill-advised, but clearly self-defeating to recovering postal financial stability,” the letter states. “Moreover, an exigency filing at this point would be premature, in light of recent progress in Congress, and a noticeable improvement in the USPS balance sheet.” The alliance, which stayed dormant for more than two years, re-formed based on rate concerns.

Latest developments: The Postal Board of Governors met Thursday to discuss postal rates but delayed a decision on whether to request an exigent increase, granting a reprieve to AMA members and other groups whose members rely on mail delivery, including the Greeting Card Association. “This action affords us additional time to work with them and detail the devastating impact a rate increase would have on the mailing industry and the 8.4 million jobs that depend on it,” MPA President and CEO Mary Berner said in a statement to The Hill. “It also gives us, the Postal Service, and the entire mailing industry additional time to continue working in concert to convince Congress that the solution to the Postal Service’s problems lies not in rate increases, but in meaningful postal reform legislation.”

The reprieve is short, however. The USPS Board of Governors will take up the issue again at their next meeting, scheduled for September 24 and 25.

Ernie Smith

Ernie Smith is the social media journalist for Associations Now, a former newspaper guy, and a man who is dangerous when armed with a good pun. More »

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