October 22, 2010, 3:14 PM

U.S. Postal Service fights once more for rate hikes

The agency also wants clarity on how postal pricing laws will be applied.

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The U.S. Postal Service has appealed a recent decision by The Postal Regulatory Commission to reject proposed postal rate hikes.

In a statement, the U.S. Postal Service says it is requesting a review of the commission’s interpretation of the law that governs how prices are set and is asking again for permission to increase rates. It’s also asked for more clarity on how postal pricing laws will be applied if it wants to raise rates in the future.

“The Postal Service disagrees with the Postal Regulatory Commission’s interpretation of the statutory language and believes that the PRC applied an incorrect standard in evaluating the request for an exigent price increase,” the statement reads.

The U.S. Postal Services also says it is exploring other ways to come up with the  $2.3 billion the rate hikes were expected to generate.

The Postal Service had sought a new rate schedule that would have raised most of its rates between 4% and 6%, effective next January. But some rate increases would have been higher for particular mail categories, including 23% for standard mail parcels and 5.1% for catalogs, the Postal Service says.

On the same day the request was turned down, competitor FedEx Corp. announced its own average hike of 5.9% slated to go into effect in January for its FedEx Express division, which handles packages of up to 150 pounds.

In an e-mail to members of the cataloger trade group, American Catalog Mailers Association president and executive director Hamilton Davison advised members to stick to the postage pricing forecasts it has provided for now, although he says the final outcome remains unclear. While courts have historically sided with regulators if they can show that they are following their own rules and guidelines, U.S. Postal Services execs would not have gone to the cost and trouble of an appeal if they did not feel their argument could stand up in court, he said.

“What does this mean to you? Right now, it is a little hard to say definitively,” the e-mail reads. “As it has all along this process, ACMA will monitor developments closely and may decide to intervene alone or with others supporting the PRC decision.”

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