Updated: Aug. 6, 2021
Electric cooperatives will pay a lot more to mail everything from bills to magazines starting Aug. 29 after regulators gave final approval to an unprecedented postal rate increase for nonprofits.
The Postal Regulatory Commission’s order, issued July 19, will raise rates for nonprofit marketing mail by an average of 7.8%. This includes 5.7% for first-class letters, 10.4% for large envelopes, newsletters and magazines and 8.6% for parcels.
NRECA joined with the Alliance of Nonprofit Mailers and fought against these rate increases, arguing that they’re not needed because of the influx of COVID-19 relief funds received by the U.S. Postal Service. The comments filed by NRECA and ANM called on the USPS to return to its policy of indexing increases to the rate of inflation, which is currently below 3%.
“This unprecedented rate hike for electric co-ops and other not-for-profits will penalize the organizations that need the U.S. Postal Service most for key communications with their members,” said Bobby Hamill, NRECA’s government relations director on this issue.
The hike was approved despite 21 members of Congress from both parties expressing “serious concern” to the USPS that the “substantial rate increases” would result in revenue and job losses, especially for small businesses.
“At this most critical moment in our nation’s economic recovery from the devastating impact of COVID-19, and in light of improving revenues for the Postal Service, this increase is premature and counterproductive,” the House members said in a July 1 letter asking the USPS to defer the hike until January 2022.
The postal service, in a July 13 response to the lawmakers, rejected the call for delay, asserted its authority to raise rates to that level and said the hike was essential for its continued operations.
ANM has documented the harm that would be suffered by nonprofit mailers and filed litigation in federal court against the Postal Regulatory Commission to reverse its decision to separate rate hikes from inflation.
Briefs were filed July 19 with the U.S. Court of Appeals for the D.C. Circuit. ANM also requested a stay on July 23 that would prevent the new rates from taking effect until after the court rules, but that is unlikely to be granted.
“We are likely to have a few months of the new higher rates before the court rules,” said Stephen Kearney, ANM executive director. “With or without the stay, we believe we have strong legal arguments for the court to overturn the regulator’s new rules allowing above-inflation rates.”
Oral arguments on the case are slated for Sept. 13. A decision by the court is expected in early 2022.
Cathy Cash is a staff writer for NRECA.