NNA Lobbying Sacks Costly Postal Service Sack Proposal

By: E&P Staff Pushed by lobbying from the National Newspaper Association (NNA) , the U.S. Postal Rate Commission (PRC) has rejected a proposal that would have imposed a surcharge on small newspapers and other mailed periodicals that use mail sacks.

Max Heath, vice president of Landmark Community Newspapers Inc. and chairman of NNA's Postal Committee, testified against the surcharges, and Doug Crews, executive director of Missouri Press Association, also appeared as an NNA expert witness before the commission.

"As NNA postal chair, I am highly appreciative that the PRC took seriously the concerns of community newspapers about service issues and difficulty of sack elimination in the near term," Heath said in a prepared statement. The PRC, he said, concluded that it should first develop a less costly container than the sack rather than "imposing rate penalties on captive users," Heath said.

At NNA's recent annual meeting in Milwaukee, Heath warned publishers that eventually newspapers will no longer be delivered using sacks.

Charging a surcharge now, though, would have been a big hardship on newspapers that mail, said NNA President Jerry Reppert, publisher of the Gazette-Democrat in Anna, Ill.

"My own printing plant uses 175 sacks a week," Reppert said. "That is $525 a week and $27,500 a year, if each of those sacks were hit with the maximum surcharge. For most of our members, that extra cost would have cost the paper a reporter's job, or caused a trimming of pages, which would have cost the community dearly in news and information.

"This charge would have been awesomely harmful to our industry as well as to our towns," he said.

The surcharge was proposed in a petition from Time Warner and other large magazine publishers such as Newsweek, Reader's Digest, and TV Guide. They suggested an assessment of $1.55 to $3.00 on periodical mail sacks. Large magazines generally ship on pallets.

Because the U.S. Postal Service (USPS) lumps mail sacks and palletized mail together, and takes a discount from the combined mail, Time-Warner and other big publishers argue they are subsidizing less efficient mailers. The surcharge was an effort to encourage smaller publications to move to so-called "co-palletization."

"Time Warner's petition was wrong-headed to begin with," NNA's Reppert said. "First, to allow a group of large magazines to create rate increases for small periodicals is simply unfair. But these particular charges -- allegedly justified because sacks cost the Postal Service money in mail processing costs -- were particularly onerous, because we have no other choice but the sack."