The PRC’s proposed changes to the postage rate-setting process will mean additional rate hikes for mailers in 2018. The first round of rate hikes, already approved, will take effect January 21, 2018 and will average 1.9%, which is the rate of inflation.
Once the new system is approved, the Postal Service is expected to immediately file for the additional 2% increase above inflation granted in the new system. Additional hikes could also be announced at that time.
The big question is when.
The PRC’s proposed changes will undergo a 90-day comment period before the PRC makes a final ruling. Public comments must be received by March 1, 2018 and reply comments are due by March 30, 2018. After this date, the PRC will issue its final rulemaking.
“The Commission expects to make a final rulemaking in the calendar year 2018,” the PRC stated in its announcement.
Theoretically, there could be changes to the plan and a final rulemaking may be delayed to accomodate the changes. More likely, the PRC — which spent a year devising the new rate system — will move quickly to give the USPS additional revenues.
Industry Reaction To PRC Rate Decision
Industry reaction to the PRC’s proposed rate-setting system has been muted thus far, with the exception of Art Sackler, Executive Director of the Coalition for a 21st Century Postal Service.
“The more-than-doubling over 5 years at current inflation rates proposed by the commission would be harmful to postal customers and the Postal Service,” Art Sackler told the Associated Press. “Once mail leaves, it rarely comes back.”