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National Postal Policy Council

NPPC is the trade association for large business users of letter mail, primarily in First Class.  NPPC is committed to ensuring that a postal system to serve business mailers and the public comprehensively, effectively and efficiently be sustained.  With the Postal Service under severe financial stress, NPPC is working with Congress, USPS and the Postal Regulatory Commission, as well as other postal stakeholders, to achieve a solution that will address the
financial challenges.

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Looking Ahead to 2017

On December 20 of this year, ten years to the date the Postal Accountability and Enhancement Act (PAEA) was signed into law by President George W. Bush, the Postal Regulatory Commission will commence a review of the postal rate and classification setting system established pursuant to the provisions of PAEA.  This review is critical:  it may hold the key to the viability of a user-fee based, business-like postal system.  For it may mean steep rate increases, and resultant steep losses in mail volumes and revenues.

PAEA directs this 10-year review and tasks the Commission with determining whether the rate setting system is meeting nine objectives, taking into account fourteen factors, Congress set out for it.  If it is, the system as is can remain in place.  If it is not, the Commission can change the system to one that will better meet those objectives.  Key among those objectives is one that requires the system to “assure adequate revenues” to sustain “financial stability.”  Clearly, USPS has been anything but financially stable for years.

And that is why this review is such a major risk, and even threat, to business mailers, very directly including NPPC members.

There are other objectives that could mitigate some of this risk, including the very first two:  to “maximize” incentives for reducing costs and increasing efficiency; and create “certainty and predictability” of rates.  But if it seems likely that USPS will go belly up and need a taxpayer bailout, the pressure will be extraordinary upon the Commission to come up with the revenues to forestall that.  And that could spell major rate increases.

However, none of this is a foregone conclusion.  NPPC, along with its colleagues in the Major Mailers Association and the National Association of Presort Mailers, has been hard at work preparing for the proceeding that will begin later this year.  This includes economic and legal evaluations of the situation, its impact on mailers and mail service providers, and potential avenues to be pursued that would lead to a constructive conclusion for our members, the system and the public.

As the process unfolds, NPPC and its allies will be full participants.  There will be no easy answers, if Congress offers no legislative change this year.  But we will make sure our industry’s voice is heard loudly, clearly and persuasively.

 


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