Postal Rate Decreases Coming in April

BEB POSTAL RATES DECREASING APRIIL 2016The USPS & PRC (Postal Regulatory Commission) have started preparation for the end of the exigent surcharge that’s been in place since January 2014.  The surcharge removal is projected to end in early April, but that date is only a forecast at this point, as it’s based solely on when the full amount authorized to be derived from the surcharge ($4.63 billion) will be collected.

For obvious reasons, the PRC is interested in ensuring that the correct date is set for the end of the surcharge and, accordingly, had directed the Postal Service to provide biweekly updates on the amount collected beginning in the postal quarter when the end of the surcharge was anticipated. Also, the agency must give 45 days’ notice of the end of the surcharge.

In its February 14 report, the USPS explained that it had collected an estimated $4.347 billion, including $827.1 million so far in FY 2016.   For the 750 days that the surcharge had been in effect through February 14, the USPS averaged about $5.796 million per day in additional revenue. At that rate the total should take just over 799 days to collect, or until about April 3, 2016.   As the PRC has noted, the USPS is entitled to collect only the amount the commission authorized, and there’s no process for refunding any excess collected from ratepayers, so the need to be as precise as possible in setting the end date is clear.  In the meantime, the surcharge revenue continues to accumulate, mailers look forward to lower rates in April, and the Postal Service worries how it will replace the 4.3% of revenue.

See below for rate changes and comparisons:

2016-04 NP STANDARD LETTER AND FLAT COMPARISON

2016-04 STANDARD LETTER AND FLAT COMPARISON

2016-04 FIRST CLASS AND PC RATE COMPARISON

If you have questions or need additional information, please don’t hesitate to contact us!

 

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