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MPA Says Postal Rate Case Should be Off the Table this Year

Press release from the issuing company

Washington, DC, May 8, 2001 - Magazine Publishers of America (MPA) today responded angrily to an announcement by the Board of Governors of the U.S. Postal Service that they are modifying the rate increase that went into effect last January by increasing postal rates for magazines another 2.6% effective July 1. This latest rate hike follows a 9.9% increase for periodicals last January. In addition, the Postal Service has already announced that it is considering filing still another rate case this summer that would call for an additional average increase of 10-15% and perhaps double that for magazines. "Magazine publishers do not believe the modified rate increase announced today is justified," said Nina Link, MPA's President and CEO. "Yet, given today's announcement, we assume that any new rate case planned for later this year is now off the table. Clearly, for the Postal Service to seek a third rate increase in one year would be misguided. The Postal Service needs to get its own house in order before strapping the American consumer with yet another rate hike." "Enough is enough," added Link. "This 'raise the rates' mentality must be stopped. It's time the postal service operate more like a business and do what any company facing these financial problems would do - cut costs and improve productivity." Senate Majority Leader Trent Lott also weighed in with a letter to Postmaster General William Henderson, in which he wrote, "I continue to look at postal rates in the same way I view taxes - don't increase them. I am quite concerned that a new postal rate increase would be planned so soon after the earlier one took effect. I am also deeply troubled by the rumored 15%-20% size of the planned increase. " In a letter to the Chairman and Vice Chairman of the Board, House Majority Leader Dick Armey said, "Concerns about losing revenue to email and other electronic communications will only be exacerbated by raising rates. Most businesses worried about losing market share provide incentives to customers - rebates, rate cuts, or improved services. Or they dramatically cut costs. If raising postal rates was the solution, last years excessive increase should have been enough - another rate increase now is simply inexcusable." In a separate letter to the Board, House Majority Whip Tom DeLay encouraged the Governors to "offer that leadership by making the tough decisions to get your fiscal house in order by some other way than hitting your customers with higher rates that will not fix the long-term problems."

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