Postal Commission Denies USPS Exigent Rate Increase Request
The Postal Service has asked the Commission to find that volume declines resulting from the recent recession are an extraordinary or exceptional circumstance. The Postal Service also supported its request with a statement from its Chief Financial Officer that it is facing a cash flow crisis, and that without some assistance it will be unable to make Congressionally-required payments in September and October of 2011.
The documentation provided by the Postal Service demonstrated that the primary cause of the liquidity crisis was structural and related to an overly ambitious requirement for the Postal Service to prefund its future retiree health benefit premiums.
After careful consideration, the Commission agreed with the Postal Service that the recent severe recession, and the decline in mail volume experienced during the recession, do qualify as an extraordinary or exceptional circumstance under the law. However, the Commission finds that the requested exigent rate adjustments are not due to the recent recession, or its impact on mail volume. Rather, they represent an attempt to address long-term structural problems not caused by the recent recession. The Commission finds, therefore, that the Postal Service has failed to meet its burden under the law and the Commission is unanimous in denying its request for an exigent rate increase.
About The Postal Regulatory Commission
The Postal Regulatory Commission is an independent federal agency that provides regulatory oversight over the U.S. Postal Service to ensure the transparency and accountability of the Postal Service and foster a vital and efficient universal mail system. The Commission is comprised of five Presidentially-appointed and Senate-confirmed Commissioners, each serving terms of six years. The Chairman is designated by the President. in addition to Chairman Goldway, the other Commissioners are Vice Chairman Tony Hammond, Dan Blair, Nanci Langley, and Mark Acton.
