Postal rates might rise in 2016 and 2017

For nonprofit mailers, including religious periodicals, postal rate hikes might be on the horizon as early as the end of this year, with further, inflation-based increases in 2017.

That and other news emerged in July, as the U.S. Postal Service’s Mailers Technical Advisory Committee met in Washington D.C. and two bills moved through legislative committee.

MTAC is made up of “industry stakeholders,” including nonprofits that mail periodicals and other material to members; for-profit catalogue companies; mail houses; direct-marketing associations; and fundraisers. The Associated Church Press and the Evangelical Press Association are MTAC members through the Coalition of Religious Press Associations (CRPA), which advocates for members’ interests in postal and other communications public-policy matters.

In April the Postal Service had rolled back the cost of postage, including that paid by religious mailers and other nonprofits. The price reduction marked the end of a 4.3 percent “exigent” (urgent and temporary) rate increase granted by the Postal Regulatory Commission in 2013, to make up postal revenues lost because of the Great Recession.

As reported in February by then-CRPA representative Bob Terry, editor of The Alabama Baptist, most mailers, including the CRPA, argued the rate should be temporary. After the Postal Regulatory Commission and two court cases sided with mailers, USPS announced it would roll back the increase on April 9, 2016, the date when the $4.6-billion shortage was projected to be recovered.

When the 4.3 percent surcharge was removed, rates reset to levels capped by the Consumer Price Index.

Partial reinstatement proposed

But part of the surcharge could return this year. The U.S. House Committee on Oversight and Government Reform passed two bills on July 12 that contain a range of measures affecting the operations and finances of the USPS.

The Postal Service Reform Act [H.R. 5714] has a stated purpose to “enhance revenue, improve efficiency, integrate Medicare, and streamline governance and oversight of the Postal Service.” And the Postal Service Financial Improvement Act of 2016 [H.R. 5707] would “authorize the Secretary of the Treasury to invest a limited amount of the Retiree Health Benefits Fund in market-based index funds and establish a Postal Service Retiree Health Benefits Fund Investment Committee to help advise the Treasury Secretary on investments made from the Fund.”

Addressing postal rates, part of H.R. 5714 says:

“(1) No earlier than the first Sunday after the date of enactment of this Act, on a date selected by the Postmaster General in the exercise of the Postmaster General’s unreviewable discretion, the Postal Service shall reinstate, as nearly as is practicable, 50 percent of the rate surcharge implemented under section 3622(d)(1)(G) (as redesignated by this Act) that was in effect on April 9, 2016; and

(2) the partially reinstated surcharge reinstated pursuant to paragraph (1) shall be considered a part of the rate base for purposes of determining the percentage changes in rates when the Postal Service files a notice of rate adjustment.”

That means half of the 4.3 percent surcharge would be permanently reinstated, increasing rates 2.15 percent.

Both bills would have to be approved by the House of Representatives and the Senate, and be signed into law by the president, but could be on the House Floor for a vote by September. According to GovTrack.us, H.R. 5714 has a 35-percent chance of being enacted this year.

Separate from the possible increase from H.R. 5714, the USPS is expected to follow their historic practice of proposing rate increases for 2017, tied to the CPI.

Autumn mail slowdown feared

Also at the July 12-13 MTAC meeting, industry stakeholders asked postal officials for reassurance about timely delivery of their products during the upcoming political and election season, when unusually heavy mail volume is expected.

For religious mailers, which publish event announcements and deadline dates in their periodicals, late deliveries could inhibit participation in church, diocesan, synod, conference, congregational, community and parachurch activities.

USPS representatives confirmed that this autumn’s political mail will receive first-in, first-out processing according to the service standard mailed, but that postal facilities and workers are preparing for the flood of election mail and expect to be ready. Nonprofits’ periodicals and other matter should receive the same service standard, they said.

Submitted by Joe Thoma. Joe is the CRPA’s MTAC representative and executive director of the Associated Church Press.

Posted July 26, 2016