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Postal Rate Change – Market Dominant Price Adjustment Recap


The US Postal Service filed on October 12th its next postage adjustment to take effect at midnight on January 22, 2017, pending Postal Regulatory Commission (PRC) approval.

Below are a few of the highlights.

R2017-1 United States Postal Service Notice of Market Dominant Price Adjustment.

The incentive for Full-Service IMB remains the same at three tenths of a cent for First-Class and one tenth of a cent for Standard mail and Periodicals.

First Class

The First Class Mail class overall is to be increased by 0.780%

The proposal includes a two cent increase in the price of a First-Class Mail Forever stamp, returning the price to 49 cents, which is what it was prior to the removal of the exigent surcharge.

The new prices, if approved, extends the “Second Ounce free” to presort letters weighing up to 3.5 oz.

Standard Mail

The Standard Mail class overall is to be increased by 0.895%, Standard Mail is being rebranded as USPS Marketing Mail.


Standard Letters

The 3-digit rate cell has been removed.

While the piece presort rate for Mxd, AADC and 5 Digit have gone down, the drop ship discounts have been reduced by $9 & $10 per/1000, which increases the DNDC and DSCF entered letters by 2-3%.   The spread from DNDC to DSCF has decreased from $9 to $8 p/1000.




Standard Flats

The new pricing includes an increase of the piece pound breakpoint from 3.3 to 4.0 ounces for Flats and Parcel shaped pieces to encourage mailers to include more content.

FSS-specific rates for flat-shaped pieces will be eliminated, specifically: DFSS entry, FSS Scheme Pallet/Container, and FSS Other Pallet/Container, and replaced with appropriate 3-Digit, 5-Digit, Carrier Route, and High Density prices.

While the Standard Mail class overall is to be increased by 0.895%, Standard Mail Flats will be increased by a weighted average of 2.493%, reflective of a PRC directive for the Postal Service to pull Standard Mail Flats out of its underwater status. Carrier Route was reduced by an average of 3.09% in part due to the removal of the FSS rates, High Density reduced by 2.025%.

As a mailer of Standard Flat shaped books, remember that the USPS breaks out Carrier Route from Standard Flats, so true the Standard Flats postage will increase about 2.5%, but if your mailing includes Carrier Route pieces that prior were paying FSS rates, your overall postage for the job should not see the same increase.

Mailers will still do their mail prep to the FSS requirements based on the DMM, but the FSS price cells have been removed from the 2017 rates, allowing mail prior qualified as Carrier Route to again pay at the CR rates.  This change will allow the USPS to add zip codes to, and change FSS zones as needed without negatively impacting the mailers postage spend.

While the letter drop ship discounts have decreased the Flat drop ship discounts for pieces 4oz and less have increased from $33 p/1000 pieces for DNDC and $43 p/1000 for DSCF to $40 for DNDC and $52 for DSCF (increasing the spread from $10 to $12 p/1000).  The drop ship pound discounts have remained the same as 2016, ($16.10 p/100 for DNDC, and $20.90 p/100 lbs. for DSCF)


  • The Periodicals overall is to be increased by 0.832%.
  • Pound and piece prices did not change – removed DFSS level
  • Bundle Prices Changes
  • CR Bundle on CR and 5 DG PLT – went from $0.270 to $0.152
  • 5 DG Bundle 5 DG PLT went from $0.313 to $0.323
  • Prices on 3 DG / SCF decreased (except for Firm)
  • ADC on ADC – increased from $0.317 to $0.327
  • Container – only change was Mixed ADC at Origin – $6.251 to $7.214

Other Items to Note

Alternate Postage will change its name to Share Mail, and the program will be revised and simplified.

The Postal Service proposes to eliminate the permit fee for Qualified BRM.

Upcoming Promotions

The U.S. Postal Service has published the final program requirements for the 2017 Promotions & Incentive programs.

Example of some of the rate changes are below.










Postal Update

August 25, 2016

Possible Postal Reform Action Pending….
Recent Postal Reform efforts are actually gaining some traction, with both a House and Senate vote expected before the years end. A favorable vote by congress would lessen the likelihood of a January postage increase.

Highlights of Postal Reform Measures….
• Bipartisan Draft legislation, (“2016 Postal Service Reform Act”) approved by the House Oversight and Government Reform Committee. House and senate, floor vote later 2016.
• Postal retirees to switch to Medicare as primary care.
• Phase out USPS mandated retiree healthcare contribution over 4 years.
• Saturday Delivery will continue
• Aggressive move from curbside delivery to cluster delivery
• Reinstate ½ or all, (4.3%) exigency rate surcharge.
• New rate setting process by 2018

Somebody in Washington is singing….
It appears that the USPS is not holding their breath, being down this path before as two other bills in the last three years have gone nowhere, are now planning to file for new rates in October with implementation on January 8, 2017. This type of information is usually vaulted until a proposal is filed. My guess…leaking such information early will add some fuel to the reform fire, prompting some serious action. But, let’s not forget congress is a little preoccupied with the pending presidential election.

Snap Shot of 2017 Postal Rate Filing….
• First-Class Presort letters weighing from 1 to 3 ounces pay the same 1 ounce rate.
• Consolidate 3-digit and AADC sort for First-Class and Standard mail, to a single AADC sort.
• Eliminate FSS price increments for Standard Mail Flat-size.
• Eliminate Permit Indicia application and annual fees.
• Eliminate Qualified Business Reply annual fees.
• Increase Standard Mail Flats weight limit for piece/pound rate structure from 3.3 ounces to 4 ounces.
• Add digital address or URL data to eDoc to support “Informed Delivery”.
• Postage percentage increase is yet to be determined.