By: Todd Shields New Rates To Take Effect July 1
The U.S. Postal Service's Board of Governors on Tuesday said it had decided unanimously to impose another rate increase on mailers. The new rates, which incorporate an average increase of 1.6%, are to take effect July 1.
The Board of Governors overruled the Postal Rate Commission, which in November slashed the rate increase requested by the Postal Service. At the time, the rate commission allowed increases in the 7-to-10% range, compared with Postal Service requests that ranged from nearly 9% to 14% in categories commonly used by newspapers.
The Postal Service instituted those rate hikes under protest in January, and twice asked the rate commission to reconsider. The rate commission, an independent body, declined to modify its decision.
Tuesday's action ends the administrative course of a rate case filed 16 months ago, and marks only the second time the Board of Governors has overruled the rate commission. The nine-member Board of Governors needs a unanimous vote to do so.
The action comes against a looming deficit that postal officials on Tuesday estimated at $1.6 billion to $2.4 billion this fiscal year. That is down from recent Postal Service projections of deficits in the range of $2 billion to $3 billion.
The Postal Service says it is struggling under escalating costs for fuel and labor, amid weak demand for premium services such as first class and priority mail.
Rates for mail classes commonly used by newspapers will increase by proportions ranging from 1.3% to 2.6% beginning July 1. The governors left unchanged the 34-cent price of the basic First Class stamp.
Last November, the rate commission allowed a rate increase for in-county newspapers of 6.8% (compared with a Postal Service request for an 8.6% increase), and for newspapers that cross county lines of 9.9% (compared with a requested 14.2% increase).
The Postal Service has indicated it may seek another rate increase in a proceeding that could begin as early as this summer.
Todd Shields (tshields@editorandpublisher.com) is the Washington editor for E&P.
Copyright 2001, Editor & Publisher.
Comments
No comments on this item Please log in to comment by clicking here