By Bill McAllister, Washington Correspondent

USPS files brief in rate appeal

June 27, 2014 02:25 PM

The United States Postal Service has told a federal appeals court that an argument against its most recent rate increase is fatally flawed, because it assumes that a massive electronic diversion of mail rather than a “great recession” is responsible for massive losses in volume that it began suffering in 2008.

The argument is contained in a brief the USPS filed June 19, challenging arguments made by mailers seeking to overturn the Postal Regulatory Commission’s ruling that approved the 49¢ first-class letter rate.

In the filing, the USPS told the appeals court panel hearing an appeal of the PRC decision that it has “consistently acknowledged the existence of electronic diversion.”

“The key drivers of electronic diversion (such as e-mail, online bill payment, and broadband access) had already existed for years when the recession hit, and other major innovations (such as smartphones and tablet computers) were still in their infancy at that time,” the Postal Service told the court.

“The far more plausible explanation for the mail volume declines is exactly what the Postal Service’s econometric models showed: that the Great Recession was the primary cause of the Postal Service’s severe and ongoing volume losses beginning in 2008.”

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