I often visit my local post office on Saturdays. There are several reasons for this habit. First, I travel during the workweek, so it’s convenient to pick up my packages, drop off mail, and sign for any Certified Mail letters. Next, it reminds me of being a kid and stopping by the Woburn Post Office to say “Hi” to my father, who was usually working the window on Saturday mornings. And lastly, I enjoy watching my fellow postal patrons interact with the clerks.
On February 9, 2018, The U.S. Postal Service (USPS) released the financial results for the first quarter of their fiscal year (October 1, 2017 to December 31, 2017). No one anticipated good news, but the numbers were worse than expected. The USPS posted a net loss for the first quarter of $540 million, compared to net income of $1.4 billion, for the same period last year. The first quarter is usually the strongest quarter with the added volumes of shipping and mailing for the holidays.
On Friday, December 1, 2017, The Postal Regulatory Commission (PRC) announced their findings and proposed rulemaking after completing the mandatory 10-year review of the system for regulating postage rates for Market Dominant products. The review and the proposed rulemaking documents can be downloaded on the PRC’s website.
Background
When Congress passed the Postal Accountability and Enhancement Act (PAEA) in 2006, the annual increase in postage rates for market dominant prices was tied to the Consumer Price Index for Urban Customers (CPI-U). The CPI-U excludes rural populations and represents approximately 80% of the population.
There were 9 stated objectives of the new system:
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Most commercial mail today doesn’t have a stamp or postage meter indicia, but bear a permit imprint. The U.S. Postal Service (USPS) rules for permit imprints are covered in the Domestic Mail Manual (DMM), Section 604.5 – “Permit Imprint (Indicia)”. In the era of the Intelligent Mail Barcode (IMb), the rules are out of date, and need an overhaul.
Last week, President Trump nominated 3 people for the 9 open seats on the United States Postal Service (USPS) Board of Governors (Board). Because the Senate hasn’t confirmed any nominees since 2009, there are no presidentially-appointed members of the Board. The terms were designed to be staggered, so there are several open seats with terms expiring in the near future.
The new nominees represent a mix of political and management qualifications.
On Friday, October 6, 2017, the U.S. Postal Service (USPS) filed the rate case for Market Dominant products with the Postal Regulatory Commission (PRC). Set to go into effect on January 21, 2018, the new rates represent about a 1.9% increase over the current prices for mailing, or “Market Dominant” products and 3.9% increases for shipping, or “competitive” products.
Interestingly, this price increase comes in the absence of both a Board of Governors (Board) and the anticipated PRC review of the ratemaking process.
