PRC Announces New Ratemaking Regulations

The Postal Regulatory Commission Service has issued its regulations to implement new modern ratemaking and classification systems for market-dominant and competitive mail products.

The regulations, available on the Postal Regulatory Commissions website at www.prc.gov, were announced eight months ahead of the statutory deadline set by the new postal law.

The regulations consist of three parts:

• Regulations related to rate adjustments for market-dominant products, including the formula for the calculation of the rate cap under which annual adjustments may be made.
• Regulations related to competitive products.
• Establishment of a Mail Classification Schedule, which categorizes products as either market-dominant or competitive.

Postmaster General John Potter, in remarks before a congressional subcommittee, says the publication of the new rate regulations takes us a giant step closer to moving from an infrequent, primarily cost-based pricing model, to an annual one that is market based.

Potter said, We are grateful for the commissions quick action in this area, many months ahead of the statutory deadline, and we look forward to moving toward this new pricing model.

Flexibility to adjust prices and product offerings promptly in response to dynamic market conditions and changing customer needs is important to the Postal Services long-term success in providing affordable, universal mail service, says Potter.