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Postage in 2017: The bottom line for your budget

Production Solutions

Many of our clients are starting to budget for 2017, so I thought this would be the best time to make some 2017 postage predictions and give you an update on Postal Reform.

There are currently many variables when it comes to this prediction; however, I believe it is fairly safe to budget for a 2% increase by January, with the potential for a mid-year increase in 2017.

With the current postal regulations, the USPS can only increase postage by the consumer price index (CPI), which is currently .6%; however, we have several more months before the USPS would file for a January increase and there are many variables that affect CPI, making it a moving target and difficult to definitively pin down.

Postal reform has been gaining some traction in Congress, but it is nowhere near finalized. There are several sections of the Reform Bill that make 2017 predictions challenging; for example, the current bill calls for a 2.15% postage increase (the true increase is 50% of the original Exigent Surcharge that was removed earlier this year) over all categories of mail. If that were to go into effect it would be in place of the 2017 CPI increase, not in addition to it.

Additionally, the bill also requires the Postal Regulatory Commission (PRC) to do a full audit on the current rates by the end of 2017. The goal is to allow the USPS and PRC to re-assess the rates to ensure each category/tier is properly balanced.

These factors take time and could prolong a definitive answer on a postage increase, which makes budgeting difficult. A 2% estimate is a safe prediction given the multitude of unknowns.

As always, our team is committed to keeping our clients updated as things change. As a member of the Mailers’ Technical Advisory Committee (MTAC) I have the unique opportunity to participate in discussions and gain insights that we will bring you throughout the year.

If you have questions about your specific budgets, please feel free to contact a member of our Business Development Team for planning help.