The USPS rate case filed with the Postal Regulatory Commission (PRC) for rate revisions to mailing regulations has been accepted, and new rates will become effective Jan. 22, 2017. The proposed overall rate increase is just under 1%, based on the final Consumer Price Index (CPI). First Class mail increases by an average of 0.8%, Standard mail 0.9%, Periodicals 0.8%, Packages by 1% and Special Services by 2.5%. The adjustment includes an average inflation-based rate increase for each class of mail; however, while some products within each class will see a price increase, other products will actually experience a price decrease.
FIRST CLASS MAIL
The proposal includes a 2-cent increase in the price of a First-Class stamp back to 49-cents. Metered mail would decrease from 46.5-cents to 46-cents. A basic postcard remains at 34-cents.
There would be a single price for First-Class Mail presorted letters weighing up to 3.5 ounces – an increase over the current 2 oz. cap. This encourages First-Class presort mailers to include more in their mail. The Mixed and AADC rates will increase by 1%, while the 5-digit rate will decrease by 0.8%. The 3-digit automation rate would be eliminated and consolidated into the mixed rates.
First-Class flat rates will increase by an average of 1.9%. The single-piece 1 oz. retail flat will increase from $0.94 to $0.98, or 4.3%. This is equal to two First Class letter stamps.
Presort postcards increase by an average of 1%.
Parcels up to 4 oz. will pay a uniform price with an increase of 1.9%, with an incremental 18-cent increase for each additional ounce.
First-Class International rates are unaffected.
STANDARD CLASS MAIL TO “USPS MARKETING MAIL”
It starts with a name change of the “Standard Mail” class to “USPS Marketing Mail”. Mailers will need to change their indicia imprint by July, 2018. More information will follow.
The proposal increases the weight limit of Standard mail automation letters from 3.3 to 3.5 oz., and non-automation letters and flats to 4.0 oz. before piece/pound rates apply. Prices for Standard mail letters increase an average of 2.1% inclusive of non-automated mail. Basic Automated Standard-Mail letters decrease by 1%, while the 5-digit rate decreases by 1.6% from 25.5-cents to 25.2-cents. The 3-digit rate level is being consolidated into a single rate at the AADC level.
Basic Carrier Route letter rates increase slightly by 0.7%; however, High Density rates decrease by 3.9%, and Saturation letters decrease by 4.6%. Prices for Standard flats will increase an average of 2.5% inclusive of non-automated mail.
One major change: By eliminating multiple Flat Sequencing System pricing cells, flats mailers will now pay a standard rate for a rate level instead of the more complicated FSS zone rates; prices are no longer based on the location of equipment used to sort the mail. In addition, the USPS is reducing the structure of NDC, SCF and DDU entry discounts.
The average increase by Outside-County mail is .8%, while the Inside-County increase is 1%. Larger circulation publishers will pay 0.5-3% less; while heavy weight mailers will pay 0.5%-1% less based on presort levels. Smaller, lower circulation publications will see above average increases.
The rate case proposal is encouraging for non-profit letter mailers, but not flats mailers. For letters, the 5-digit letter rates decline 2.9% and High Density/Saturation rates decline 7.5%. For flats, the 5-digit rate increases 3%, and High Density/Saturation rates increase 3.8%.
A few other proposed revisions include:
Full-Service IMB discounts remain in place at $.003 for First-Class mail, and $.001 for Marketing Mail.
Midwest Direct and C.TRAC Direct will continue to monitor the latest information as the final 2017 Rate Case proposal is evaluated by the PRC for final approval. Be sure to follow us on Twitter and LinkedIn.tags: USPS