Congressmen Ask for 2.15% USPS Rate Increase

USPS LogoAfter business hours on Wednesday night, a catalog association warned its members that USPS may get half of its exigency rate hike back. First Class postage dropped from 49 to 47 cents in April when USPS lost its 4.3 percent exigent surcharge imposed as a result of its losses during the Great Recession.

“The House Oversight Committee today unveiled a discussion draft postal reform bill,” reads the blast ACMA emailed to its members. “In a press conference, five key committee members, including Chairman Jason Chaffetz (R-UT-3rd) and Ranking Member Elijah Cummings (D-MD-7th), explained the draft bill’s core elements. The bill will be marked up in committee in about two weeks, then introduced so it will be ready when Congress is back in session.”

The bill (opens as a PDF) calls for postal employee benefits and pension reform, a 2.15 percent rate hike instead of the return of the full 4.3 percent USPS representatives requested and details about how the proposed legislation (opens as a PDF) differs from the Senate’s proposal.

“Although there are very few legislative days remaining in this Congress, we feel this is a workable bill,” writes Paul Miller, VP and deputy director of the American Catalog Mailers Association, “given the wide variety of interests each pulling for their vision of an ideal postal service. The cost improvements will offset the 2 percent rate hike and, in our view, if that is the price of getting it done, it is worth the support. The impact of not getting any postal reform and the cost reductions contained within it could be catastrophic, because then the Postal Regulatory Commission’s upcoming 10-year review would likely produce little more than big rate hikes to offset losses.”

ACMA added this comment via an email to Target Marketing on Thursday: “Perhaps more alarming, however, the bill directs the postal service to raise rates on ‘loss-making monopoly products,’ (namely, underwater products like Standard Flats) – subject to certain overall rate increase limitations.”

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Heather Fletcher is senior content editor with Target Marketing.
Publish date: June 16, 2016 © 2020 Adweek, LLC. - All Rights Reserved and NOT FOR REPRINT