Latest News and Highlights  

U.S. Postal Service Files Annual Compliance Report Postal Accountability and Enhancement Act, today the Postal Service filed its Annual Compliance Report (ACR) with the Postal Regulatory Commission (PRC). The ACR is used to determine that the Postal Service is in compliance with the relevant statutory and regulatory requirements that govern USPS pricing and costing. It includes detailed information on product volumes, revenues, and attributable costs as well as the cost avoidance estimates used to develop workshare passthroughs. Given the proposed changes to the PRC’s system of regulating USPS rates, these estimates take on particular importance.  Accompanying the report itself is an extensive set of USPS workpapers and technical appendices which can be found here.

Postal Regulatory Commission (PRC) issues ruling in Ten-Year Regulatory Review On December 1, 2017, the Postal Regulatory Commission (PRC) issued the long awaited ruling in R2017-3: Statutory Review of the System for Regulating Rates and Classes for Market Dominant Products. The Postal Accountability and Enhancement Act (PAEA) stipulated that after ten years, the PRC was required to conduct a review of the ratemaking system established under PAEA to determine if the goals of the legislation were being met. According to the PRC the current system is not meeting the objectives of PAEA. As a result, the PRC is initiating a notice of proposed rulemaking (NOPR) that includes the following: Retention of a price cap based system;  USPS gains additional 2% pricing authority above CPI for next 5 years after which the PRC will evaluate the financial health of USPS; USPS may gain additional 1% pricing authority if service and operational targets are met; Products that are not covering attributable costs must have price increases at least 2% more than the average for their class; For periodicals all workshare passthroughs must be between 75% and 125%; For all other products passthroughs must be between 85% and 115% and Non-compliant workshare discounts will be subject to a three year grace period.   Op-Ed Written by Michael Plunkett, PostCom President & CEO   PostCom's Summary of the Decision 

U.S. Postal Service Issues 2018 Financial Plan The Postal Service has released its 2018 Integrated Financial Plan. For Fiscal Year 2018 – which began on October 1, 2017, USPS is projecting an operating loss of $1.4 billion and a net loss – after accounting for USPS funding of retiree obligations - of $5.2 billion. FY 2017 ended with an operating loss of $800 million and a net loss of $2.7 billion. For 2018, USPS is predicting that volume will decline from 149.5 billion pieces to 144.9 billion. While package volumes are expected to increase by 400 million pieces, USPS is projecting that First-Class Mail will decline by 2.5 billion pieces and that marketing mail will fall from 78.3 billion pieces to 76.1 billion. Despite the 4.6 billion piece decline in volume, USPS is projecting that compensation and benefits expenses will increase from $50.5 billion to $50.7 billion. 

U.S. Postal Service Reports Fiscal Year 2017 Results On November 14, the USPS reported its financial results for FY 2017. The Postal Service reported a net loss for the year of $2.7 billion, a decrease in net loss of $2.8 billion compared to 2016. Of this decline in net loss, $2.4 billion was the result of changes in interest rates, outside of management's control, that reduced workers’ compensation expense compared to last year.  In 2017, mail volumes declined by approximately 5.0 billion pieces, or 3.6 percent, while package volumes grew by 589 million pieces, or 11.4 percent, continuing a multi-year trend of declining mail volumes and increasing package volume. While mail volume declines for the year were somewhat offset by growth in package volume, overall volume has declined by 4.9 billion pieces.

PRC approves U.S. Postal Service Proposed Price Change On November 7, the Postal Regulatory Commission approved the Postal Service's proposed price changes for its competitive products. The new prices will go into effect on January 21, 2018. 

White House Announce Board of Governor Nominees On October 26, 2017, the White House announced nominations for three individuals to be postal governors. They are Calvin Tucker of Pennsylvania, Mike Duncan of Kentucky and David Williams of Illinois. These nominees are: Calvin R. Tucker of Pennsylvania, for the remainder of a term expiring December 8, 2023;  Robert M. Duncan of Kentucky, for the remainder of a seven-year term expiring December 8, 2018, and an additional term expiring December 8, 2025 and David Williams of Illinois, for the remainder of a seven-year term expiring December 8, 2019.

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Five Things You Need to Know

1. USPS's price changes will be implemented on January 21, 2018

2. CPI rises 0.4 percent as gas prices increase

3. USPS simplified the Customer Supplier Agreements (CSAs) structure

4. USPS Marketing Mail Change will not be implemented prior to January 2019

5. USPS Chief Customer Office James (Jim) Cochrane is Retiring February 2018 

Upcoming Events

January 16, 3pm EST. PostCom Monthly Member Webinar. Register Here

January 23-24, PostCom Study Day & Board of Directors Meeting. Alexandria, VA

June 5-6, PostCom Study Day & Board of Directors Meeting. Alexandria, VA

Oct 16-17, PostCom Study Day & Board of Directors Meeting. Alexandria, VA

Every Wednesday, 2-3pm EST:  USPS Move Update Webinars 

ICYMI: All past USPS presentation are available on RIBBS.