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Today, the
Postal Service Board of
Governors announced that future
price adjustments will follow
the new regulations issued by
the Postal Regulatory Commission
on October 29, 2007. Future rate
increases will follow the
regulations of the Postal
Accountability and Enhancement
Act (PAEA) of 2006.
This announcement confirms that
a cost of service full-blown
rate case will not be pursued.
The Board of Governors had the
option of filing one more rate
case using the old rules, and
had to file the rate case by
December 19, 2007.
Using the new rules, future
pricing will be reasonably
predictable, and capped at the
rate of inflation. No category
of mail as a whole can exceed
the rate of inflation, but
segments of a category can go
higher or lower, as long as the
composite rate does not exceed
the rate of inflation. Further,
pricing changes can take effect
within months, instead of the
lengthy rate case scenario of
the past.
Many details still have to be
worked out, and I would expect
rates changing in the late
spring of 2008. |
