November 3, 2017

USPS proposal to change the ratio between Nonprofit and Commercial Marketing Mail

At some point relatively soon, the Postal Regulatory Commission will issue a decision that could have an additional detrimental impact on nonprofit fundraisers. It is likely to either keep the status quo used for the past ten years, basing the ratio on the full MM class of mail. Or it will create synthetic sub-classes of MM, and result in nonprofit MM rate increases of 3.33 percent for Regular Nonprofit, and 6.94 percent for Enhanced Carrier Route Nonprofit. These massive increases would be in addition to the large hikes already imposed in 2017 and planned for 2018.

The Alliance represents all nonprofit mailers in opposing this unconscionable, arbitrary increase in nonprofit postage. We were joined by 80 nonprofits who wrote letters to the PRC in opposition. The Postal Service was taken aback by the response of the nonprofit community, and it filed an unprecedented second round of comments for what they positioned as a technical adjustment. The Alliance successfully debunked everything the USPS said.

There is no time table for a very busy PRC to announce its decision. We will keep you posted.

Ten-year rate review

The PRC promised an initial decision and a proposed rulemaking in “the fall.” Autumn lasts until winter begins on December 21, 2017. The PRC has done an excellent job keeping their deliberations completely confidential. And this extends to no one outside the PRC knowing when the decision will come out. The operative assumption in the mailing community is that the decision will be issued sooner rather than later. But the PRC is rightfully making sure they do the best job they can, rather than adhering to an arbitrary timeline.

At stake, of course, is the price cap regulatory system that has operated for the past ten years and stood the test of the worst recession since the Great Depression. But it is important to remember that the fall 2017 announcement will be but one, albeit very important, step in an extended process. A proposed rule-making process will follow any decision to change the system in any way, and that will involve rounds of comments and rebuttals. The prevailing wisdom is that any PRC decision will ultimately find its way into the U.S. Court of Appeals.

The good news is that “ten year” refers to the anniversary of the 2006 postal reform law, and not to how long the review will take.