Newspapers challenge removal of rate cap established by Congress
Today, the News Media Alliance and the National Newspaper Association – representing thousands of local newspapers across the United States – have joined a legal challenge of an order by the Postal Regulatory Commission (PRC) that would effectively eliminate a Congressionally-mandated limit on postal rate increases for Periodicals and Marketing Mail, which since 2006 has required postal rate increases to remain within a statutory price cap tied to the Consumer Price Index.
Under the new rate-setting system, the U.S. Postal Service will be able to increase the postage assessed to newspapers by roughly 9% annually over the next five years. Rate changes of this magnitude would be unsustainable for newspapers and could force small market and community newspapers to close their doors.
The current pricing structure has provided newspapers and other mailers with smaller, more predictable rate increases, which has convinced businesses to keep mail volume in the postal system. Removing the statutory rate cap will ultimately weaken the nation’s postal system through the loss of mail volume and revenue.