ALG Connect: PRC Approves USPS Rate Filing - July 2024

The PRC has just approved the USPS proposed rate case that would go into effect on July 14, 2024.


The PRC cited that The Commission concludes that the planned price adjustments are consistent with the regulations of 39 C.F.R. part 3030 and applicable Commission directives and orders.


The Commission did go on to state that although the price adjustments proposed in this proceeding are consistent with applicable law and the Commission has no legal basis to reject the proposed changes, the Commission is concerned, given the current state of affairs, that the Postal Service’s proposal does not reflect reasoned consideration of the potential widespread effects of its proposal, is not prudent, and is not consistent with the best interests of all stakeholders.  Specifically, the Commission remains concerned about the substantial declines in Market Dominant volumes, overall service performance for Market Dominant products, and the Postal Service’s overall financial situation, issues that have all remained significant, if not worsened, since the current Market Dominant ratemaking system went into effect.  The Commission has opened Docket No. RM2024-4 to consider whether the current ratemaking system is achieving the objectives of 39 U.S.C.


While the review in Docket No. RM2024-4 is ongoing, the Commission reminds the Postal Service that it expects it “to use its business judgment in utilizing the tools provided in the system of ratemaking to craft pricing schemes and specific prices” and encourages the Governors of the Postal Service to consider these issues and the issues raised by stakeholders when exercising their business judgment to determine the frequency and magnitude of future Market Dominant price adjustments. 


The Commission strongly encourages the Governors to consider exercising their business judgment, consistent with statutory and regulatory requirements, not to increase rates by the full amount permitted by law.  Participants in the docket presented a number of reasons why rate increases below the legal limit may be appropriate for business and public policy reasons. 


The PRC decision can be found here