Prices for most Postal Service mailing services will change on January 22, 2012. Mailing services includes First-Class Mail, Standard Mail, Periodicals, Package Services and Extra Services. Prices for shipping services will also change on January 22. We will provide customers the new shipping services prices later this fall.

While actual percentage price increases for various products and services varies, the overall average price increase across all mailing services is capped by law at 2.1 percent, the rate of inflation as measured by the Consumer Price Index.

FIRST-CLASS MAIL HIGHLIGHTS:

• Letters (1 oz.) – 1-cent increase to 45 cents. This is the first increase in the price of a First-Class Mail stamp since May 2009.

• Single-piece letters additional ounce rate – unchanged at 20 cents.
• Postcards – 3-cent increase to 32 cents
• Letters to Canada or Mexico (1 oz.) – 5-cent increase to 85 cents
• Letters to other international destinations – 7-cent increase to $1.05
• The second ounce will be free for First-Class Mail Presort pieces weighing between one and two ounces.

ADDITIONAL PRICE ADJUSTMENT HIGHLIGHTS:

• The price increase for Standard Mail Letters is slightly below the overall average at less
  than 1.9 percent

• A new 3-month pricing option will be available to rent PO Boxes for people on the move and others that need a PO Box for a shorter time period.
• Delivery Confirmation will be free for several parcel products as the Postal Service continues to make tracking an integral component of parcels mailed at commercial rates.

ROLE OF THE POSTAL REGULATORY COMMISSION:

The new prices were filed with the Postal Regulatory Commission on Oct. 18, 2011. The Commission has 45 days to review the prices to verify they comply with the overall 2.1 percent price cap for each class of mail. The new prices will go into effect on Jan. 22, 2012.

The Appeals Court found that the PRC erred in requiring too exact a link between the rate increase and the revenue lost by the USPS due to the specific “extraordinary” circumstance. It held that since Congress had not required that any exigent increase be solely due to the specific cause cited by The USPS, it was up to the PRC to spell out “how closely the amount of the adjustments must match the amount of the revenue lost as a result of the exigent circumstances.
Because the Commission did not…, we remand for it to do so now”.

Here’s the full decision:

USPS v. PRC Opinion on Merits

On Wednesday the Postal Regulatory Commission found that the Postal Service postage increases for market dominant classes of mail were correctly calculated within the statutory CPI price cap. Thus, those rate increases will be effective on Sunday, April 17, 2011.

The Commission, however, expressed disappointment that USPS had failed to rate postage on Standard Mail flats sufficiently to cover the costs of processing, transporting and delivering that mail. In fact, the Commission found that the new rates would increase the cross-subsidy of flat-shaped mail by Standard Mail letters. “While not unlimited, [the USPS pricing] flexibility is sufficient to allow the Postal Service to address the flats’ cost coverage issue within the rate cap. In this proceeding the Postal Service could have designed Standard Mail Flats prices to better align rates with costs and, over time, allow this product to be ‘brought to full cost coverage.’” The Commission expects this error to be rectified in future rate adjustment filings.

The Commission also criticized the Postal Service use of “unaccepted” costing methodologies when determining work-share discounts. Again, the Commission did not require any adjustments in this time shortened proceeding, but it expects the Service to refrain from such actions in future filings.

“The Commission should be focusing on market based pricing and not on what should be the abandoned cost of service pricing of the old law. The Postal Service rates for Standard Flats are market driven and those efforts should be applauded,” said DMA Senior VP Jerry Cerasale.

The Commission’s concern on both the methodology and the Standard Mail cross subsidy may also be addressed in the Commission’s Annual Compliance Review or a complaint case.

The Commission decision may be found at:
http://www.prc.gov/Docs/71/71974/Order_No_675.pdf

The Postal Regulatory Commission has established Docket R2011-2, to receive comments on postal rate changes for market dominant products filed January 13 by the U.S. Postal Service. The rate changes, which include maintaining the current First-Class, first ounce rate at $.44, are scheduled to take effect on April 17, 2011.

“The Commission will carefully review the Postal Service’s pricing proposals to ensure that the increases comply with the price cap and are consistent with statutory pricing policies,” said Commission Chairman Ruth Y. Goldway. “We encourage the public to participate in the process by sharing with the Commission their views on the requested postage increases.”

Commission rules require that action be taken within 45 days of receipt of the Postal Service’s filing and permit a 20-day public comment period. The comment period allows the public to address the consistency of the new rates with statutory requirements, including a CPI-based price cap.

Comments from interested parties are due by February 2, 2011. Information on the filing of comments and the calculation of the annual CPI price cap – which is 1.741% in this Docket – is available on the Commission’s website, www.prc.gov. Market dominant products include First-Class letters and cards, advertising mail, Periodicals, and single piece parcels.

Within 14 days of the conclusion of the public comment period, the Commission will determine whether the planned rate adjustments are lawful and issue an order announcing its findings. Kenneth E. Richardson, an attorney in the Commission’s Office of General Counsel, will represent the interests of the public in this proceeding.

Senator Collins’s brief argues that the PRC’s decision is consistent with the text, legislative history, purpose, and intent of the comprehensive rate system included in the Postal Accountability and Enhancement Act (PAEA) – a 2006 law that she authored. Senator Collins further notes that the Postal Service’s current financial condition is the result of numerous non-exigent factors. Under the law, these factors cannot support an exigent rate increase because they have no connection to an “extraordinary or exceptional circumstance” that the Postal Service could not reasonably be expected to have accounted for in the normal course of business.

“The economy and technology are affecting the Postal Service and, indeed, all businesses. But in writing postal reform legislation in 2006, my intention was not to permit rate increases above the inflation-based cap as relief from chronic, ordinary, or unexceptional circumstances and general Postal Service red ink,” said Senator Collins. “I hope the Court of Appeals will uphold the September 2010 PRC decision which found that the Postal Service failed to prove that its request met the standard of the law.

“Allowing the Postal Service’s exigent rate increase would undermine the stability and predictability in rates that the PAEA sought to establish. Moreover, such an interpretation of the law would produce absurd results – allowing the Postal Service to raise rates to cover revenue shortfalls from any cause, so long as it could identify an ‘extraordinary or exceptional circumstance’ affecting any portion of postal operations. The resulting loophole in the hard, inflation-based cap would lead to disastrous consequences for the Postal Service as the resulting rates would further erode volume as postal customers seek alternatives to mailing.

“The Postal Service needs to redouble its efforts to cut costs, develop new services to increase volume, re-invent its business model and work with the Administration to remedy an overpayment to the federal retirement fund. I will continue to press the Administration and the Postal Service on these vital reforms.”

The Postal Service is the linchpin of a $1 trillion mailing industry that employs approximately 7.5 million Americans in fields as diverse as direct mail, printing, catalog production, paper manufacturing, and financial services.

On July 6, the Postal Service filed its exigent rate case with the PRC, seeking approval for a wide array of rate increases. The Postal Service experienced a loss of more than $8 billion for fiscal year 2010. Its requested exigent increases, averaging 4 to 6 percent, would have far exceeded the rate of inflation. For one class of mail, for example, the proposed increase would have been a whopping 23 percent. For catalog mail, the Postal Service proposed a postage hike of more than 5 percent, which owners warned would prompt many catalog businesses to reduce mail usage and direct customers to websites.

WASHINGTON, Jan. 13, 2011 /PRNewswire-USNewswire/ — The first U.S. Postal Service price change in two years will have minimal impact on retail customers who will continue to pay only 44 cents for a stamp.

The prices filed with the Postal Regulatory Commission today will become effective April 17.

Highlights of the pricing proposal include:

* First-Class letters (1 oz.) remain unchanged at 44 cents,

* First-Class letter additional ounces increase to 20 cents,

* Postcards will cost 29 cents,

* Letters to Canada or Mexico (1 oz.) increase to 80 cents, and

* Letters to other international destinations will remain unchanged at 98 cents.

“While changing prices is always a difficult decision, we have made every effort to keep the impact minimal for consumers and customers doing business with us at retail lobbies,” said Postmaster General Patrick R. Donahoe. “We will continue to balance our business needs against the needs of our customers.”

The overall average increase across all mailing services is capped by law at 1.7 percent – at or below the rate of inflation as measured by the Consumer Price Index – although actual percentage price increases for various products and services will vary.

Prices will change for other mailing services, including Standard Mail, Periodicals, Package Services and Extra Services. Larger volume business mailers will see price increases in a variety of categories. Detailed pricing information will be available later today online at www.usps.com/prices. Today’s announcement does not affect Express Mail and Priority Mail prices.

In July 2010, the Postal Service filed an exigent price proposal that was rejected by the Postal Regulatory Commission in September. The Postal Service filed an appeal of that decision with the United States Court of Appeals for the District of Columbia Circuit in November and awaits a decision.

Faced with decreased mail volume traced to the recession and increased use of the Internet, the Postal Service continues to face a daunting financial crisis. Increasing prices is one of a series of solutions the Postal Service proposed in March 2010 to address the crisis. Other actions outlined in the March plan included changes to delivery frequency, restructuring prepayments of future retiree health benefits, creating a more flexible workforce and expanding access to products and services to places more convenient to customers. In December, Donahoe began a reorganization of all administrative and managerial functions as part of his vision to operate “leaner, faster and smarter.”

The Postal Service receives no tax dollars for operating expenses, and relies on the sale of postage, products and services to fund its operations.

A self-supporting government enterprise, the U.S. Postal Service is the only delivery service that reaches every address in the nation, 150 million residences, businesses and Post Office Boxes. The Postal Service receives no tax dollars for operating expenses, and relies on the sale of postage, products and services to fund its operations. With 32,000 retail locations and the most frequently visited website in the federal government, usps.com, the Postal Service has annual revenue of more than $67 billion and delivers nearly 40 percent of the world’s mail. If it were a private sector company, the U.S. Postal Service would rank 29th in the 2010 Fortune 500. Black Enterprise and Hispanic Business magazines ranked the Postal Service as a leader in workforce diversity. The Postal Service has been named the Most Trusted Government Agency six consecutive years and the sixth Most Trusted Business in the nation by the Ponemon Institute.

Full story: Postal Service continues rate case appeal – Fedline – The Federal Times Blog – federal news, government operations, agency management, pay & benefits.

Pursuant to Federal Rules of Appellate Procedure 27(a)(3)(A) and 27(a)(2), Petitioner United States Postal Service hereby opposes the separate Motions to Intervene filed by the Newspaper Association of America, Time Warner Inc., Valassis Direct Mail, Inc., the Affordable Mail Alliance, the Alliance of Nonprofit Mailers, the Association for Postal Commerce, the Direct Marketing Association, Inc., the Magazine Publishers of America, Inc, the National Postal Policy Council, American Business Media, and the National Newspaper Association. These eleven would-be intervenors were not “parties” below; they were merely commenters. Accordingly, they are not entitled to intervene as of right. Further, allowing a host of mere commenters to intervene permissively in this review proceeding would unduly burden the original parties and this Court, interfering with the Court’s ability to resolve this petition with the expeditiousness the Court has already recognized is needed. Therefore, the motions should be denied.

10-11-18 USPS Opposition to Interventions

DC Circuit Court of Appeals Order.