Guest Column: Postage Rates Rising
So, we won't know the outcome until as late as Oct. 4. Of major concern right now is the public allegation made by the Commission Chairperson that periodicals mail is only covering 76 percent of its contribution to the postal dollar. Comments made in print and on C-SPAN support that allegation and, it would seem, could prejudice the PRC's opinion.
The method of calculating this shortfall is being challenged by mailer groups for not accounting for up-to-date mailing procedures such as the recent addition of container rates, and the application of co-mailing and co-palletizing procedures. (Only periodicals mail incurs an additional charge for containers and the distance they travel.)
If a decision is made to fully compensate for the alleged 24-percent shortfall, the periodicals industry could be driven out of business completely, or from print to electronic media.
Hopefully, more logical heads will prevail, and the additional 3-percent to 4-percent increase is found to be an acceptable alternative, if indeed there is a need for it.
Are there other ways to offset and forestall this increase? Maybe.
Arguments have been presented to Congress that the amounts currently paid out for future retiree health benefits need to be re-computed. If postal-driven numbers are found acceptable, the $5.4 billion annual payment can be cut virtually in half.
The Office of the Inspector General for the Postal Service detected an error in calculating payments to the Civil Service Retirement System that was initially believed to be $75 billion, and was adjusted to between $50 billion and $55 billion by an independent review from the Segal Co. through the PRC. A bill, HR 5746, the "United States Postal Service's CSRS Obligation Modification Act of 2010," has been introduced in Congress to remedy this and put the money back into the USPS Treasury.
Ed Mayhew worked for the Postal Service for 37 years, becoming one of the most recognized experts on periodicals mail in the country. Ed was a part of the Rates and Classification Service Center (RCSC), ending his career as a Classification Specialist in the New Pricing and Classification Service Center in New York City. He has written rulings, instructions and articles for postal publications, appeared as an expert witness in court, a rebuttal witness for the Postal service at the Postal Rate Commission, co-authored postal handbooks and applications, and was the RCSC coordinator for six postage rate cases.
He is the 2002 winner of the Angelo R. Venizian award for contributions to the publishing industry, the first postal winner of that award in its history.
Ed has made training videos appearing on radio and TV, speaks at numerous seminars and is an 11-time top National Postal Forum speaker. He is founder and president of consultancy Eddie Mayhew’s Classification Station. Contact Ed at 973-462-5662, E-Mail at email@example.com or Twitter @eddiemclass.