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U.S. Postal Service Seeks Dismissal of Pricing Protest

August 3, 2010
WASHINGTON, DC—Aug. 3, 2010—Saying the Affordable Mail Alliance made “manifestly misleading comparisons” and advanced a “strained and fatally flawed interpretation” of existing law, the U.S. Postal Service today asked the Postal Regulatory Commission (PRC) to deny an alliance request to dismiss the Postal Service’s current pricing request.

“The Commission should refuse the Alliance’s invitation to ‘go through the looking glass,’ deny the motion and proceed to a consideration of whether the Postal Service’s requested rate increases are ‘reasonable, equitable and necessary,” the Postal Service response states.

The Postal Service filed recommended price changes with the Postal Regulatory Commission on July 6, providing data and evidence that “exceptional and extraordinary circumstances” exist, allowing the Postal Service to seek prices above the current .6 percent Consumer Price Index cap. The Affordable Mail Alliance (AMA) last week asked the PRC to deny the request.

The Postal Service motion filed today lists a number of mistakes, misrepresentations and misinformation with the AMA’s request, including:

The Postal Service has proven extraordinary circumstances:

Precipitous, unprecedented and unforeseen drops in mail volume are inarguable and meet the definition and spirit of the law. In fact, a letter from two primary authors of the Postal Act, Sen. Thomas R. Carper (D-DE) and Sen. Susan Collins (R-ME), noted that “extraordinary or exceptional circumstances” include not only terrorist attacks and natural disasters, but also “other events that may cause significant and substantial declines in mail volume…that the Postal Service cannot reasonably be expected to adjust to in the normal course of business,” such as the worst recession since the Great Depression.

“Rather than engage in arcane disputes about whether a particular circumstance could arguably have been foreseen, the focus on the exigent inquiry should be of its impact on the Postal Service,” the Postal Service filing states.

The AMA knows that the Postal Service has very specific legislative and regulatory restraints in labor and workforce issues:

The Postal Service has no discretion under the law to suspend any benefits, payments, including matching contributions to workers’ Thrift Savings Plans. More than 93 percent of private sectors companies and 88 percent of public sector companies do not have union representation. Those that do are not forced to rely on an interest arbitrator to resolve contract negotiations.
 

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