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USPS Exigent Surcharge – Final Court Ruling

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On Friday, June 5, 2015, the United States Court of Appeals ruled that the Postal Regulatory Commission’s (PRC) original ruling on the Exigent Increase will stand. Meaning, the Exigent surcharge of 4.3%, that was implemented in January of 2014, will eventually be removed.

However, the Court remanded how the PRC calculated the total revenue lost due to the Great Recession. Basically, the PRC used only the first year’s decreased mail volume to calculate total revenue lost; which was originally totaled $3.2 billion. The Court’s remand allows the Postal Service to recoup revenue based on the point in time that the volume decreased and the time it took the Postal Service to adjust to the “new normal” volume. This means, the PRC must determine the true time it took for the Postal Service to adjust to the “new normal” volume and how much revenue was lost over that total time period.

It is too early to know what will happen next, as there are a few possibilities: remove the current surcharge in August; allowing the PRC time to recalculate lost revenue and then roll-out a new surcharge; or keep the current surcharge active while the PRC recalculates the new revenue loss and timeline.

The entire Court ruling can be read here