Affordable Mail Alliance Calls on Postal Commission to Dismiss Rate Hike Request

WASHINGTON, DC—July 26, 2010—The Affordable Mail Alliance (AMA) today called on the Postal Regulatory Commission to dismiss the Postal Service’s rate hike proposal filed on July 6, 2010. AMA’s motion argues that the rate hike violates the cost controls Congress put in law to protect consumers and that the Postal Service needs to cut costs and modernize rather than raise rates an average of ten times the rate of inflation.

“Allowing the Postal Service to raise prices above the Consumer Price Index in this case would nullify the single most important safeguard for mailers and the public in the Postal Accountability and Enhancement Act of 2006 (“PAEA”),” AMA argues in its motion. Senator Susan Collins (R-ME), an author of the 2006 law, has already said the proposed increases do not qualify for an exception under the standards established by Congress.

The Affordable Mail Alliance (AMA) is a coalition of over 700 large and small businesses, nonprofit organizations, and associations of mailers that together account for a majority of the mail sent in the United States. Its members employ over 7.5 million workers and contribute nearly one trillion dollars to the economy each year.

The PAEA limits the average postal rate hike to inflation as measured by the Consumer Price Index (CPI). There is an exception to the CPI cap only for “exigent circumstances” when the Postal Service could not continue operating without overall price increases above the CPI. But this exception is intended only for “extraordinary or exceptional circumstances” that would leave the Postal Service short of funds to provide necessary services despite “the best practices of honest, efficient and economical management.” The AMA argues that the Postal Service has not met that test, pointing out:

• Economic downturns are a part of life. The ups and downs of economic cycles, like changes in the weather, are not “extraordinary” or “exceptional” circumstances.