The Postal Rate Commission has reaffirmed its recommendations for a 4.6% postage rate increase in a decision highly critical of the financially ailing U.S. Postal Service's Board of Governors. This is the PRC’s second reaffirmation.
"The governors of the postal service have received the postal rate commission's April 10 2001 opinion and recommended decisions on the R2000-1 rate case," USPS spokesperson Gerry Kreienkamp told DIRECT Newsline.
"The governors are reviewing the commission's latest opinion and will consider their response and an appropriate course of action at a future meeting," he added.
By law, postal governors can challenge the PRC's recommendations in court, or, by unanimous vote, override the PRC and order a new round of rate increases.
The Alliance of Nonprofit Mailers "supports the PRC's final decision, if this is a final decision because it is the only appropriate and legal action the PRC could have taken considering that postal governors refused to update any information in the record," said Neal Denton, executive director.
In the decision, the PRC said that postal governors "seem to suggest that the Commission should treat the size of the [postal service's] revenue requirement as a policy decision of the board that is not subject to change."
Asserting that the law was on its side, the PRC said it "neither acted improperly nor subordinated the governors managerial or policy functions" with its actions and recommendations" in November and again in February when it reaffirmed its earlier actions after reviewing them at the request of postal governors.
The USPS, which now claims to be facing deficit of between $2 billion and $3 billion this fiscal year, asked the PRC last year to endorse a proposed 6% rate increase that would generate approximately $3 billion in new revenue while holding $2.8 billion in reserve for emergencies.
The PRC, rejecting that proposal, reduced the contingency fund by $1.7 billion to $1.1 billion and recommended that rates be increased only by 4.6% to raise a total of $69.9 billion in revenue for the current fiscal year.
