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JuLY 2007

U. S. Postal Service strikes again
Postage rate increase impacts American Recycler and other publications

Due to recent changes in the rates charged by the U.S. Postal Service (USPS), the cost to mail American Recycler to its readers has jumped an unprecedented 42 percent.

“It’s unfortunate that a service has become so costly that it could result in the closing of some small publications and periodicals,” stated Esther Fournier, publisher of American Recycler. According to Susan Currier of Tribune Publishing, countless other publications that fall in the same “standard flat mail” category as American Recycler have also been adversely impacted by this rate increase.

Tribune Publishing Company, based in Columbia, Missouri provides printing and mailing services to American Recycler and other newspapers like The New York Times. Currier, commercial printing customer service manager, said “I believe the post office has handled this whole situation very poorly. This will be a nightmare for their public relations department.”

At press time, Currier had just attended a seminar presented by the U.S. Postal Service, for periodical publications that will experience an increase on July 15th. “It was very frustrating. The Postal Service wants publications to consolidate their mail, but this is not an easy fix for all publications, because the cost to consolidate the mail can be more expensive than the rate increase itself. This is more easily done by huge publishers like Time Warner. These companies are dealing with large press runs and are able to commingle mail and have the capability to deliver deeper into the mail stream, taking advantage of the Postal Service’s work-share discounts.” The seminar speaker also advised attendees to write their congress representatives to voice their dissatisfaction with the rate increase.

According to a Z Magazine article published on May 30, 2006, the Postal Service tasked the independent Postal Regulatory Committee (PRC) with coming up with a plan to increase revenues. The USPS itself offered a plan for a rate increase that would have raised costs for all publishers, more or less evenly, by around 12 percent. During the public comment period, Time Warner submitted their proposal.

The Time Warner plan offered various incentives that could only be realized by large publishing groups. To the surprise of many, the PRC announced in late February that it was going with a plan similar to Time Warner’s, instead of adopting what the USPS had originally suggested. In March, the USPS allowed only 8 days for public comment on the 758-page PRC plan before they adopted it. This plan is so complex that even two months later, some publishers said they still cannot calculate exactly how much more their costs will be.

Fournier said, “The latest turn of events are inconsistent with the mission of the Postal Service, which, according to federal law, is to ‘bind the nation together through personal, educational, literary, and business correspondence of the people.’”

A letter from several small publishers sent to the USPS Board of Governors in April said, “These new rates will have grave consequences for disseminating the very type of information our founding fathers strove to protect and foster when they first established the public postal service.” According to a study by McGraw Hill cited in the letter, “Some small magazines will no doubt go out of business. Some will be forced to produce a lesser product to pay for these increases.”

Though the public comment period has passed, public outcry against the plan is growing and is having some effect. Implementation of the new periodical fee structure has been delayed from May until July 15, and a “Stamp Out The Rate Hikes” campaign is underway to generate further public opposition through letters and other actions (Z Magazine, May 30, 2007).

“American Recycler is not in the position of having to discontinue our publication. However, we have asked our readers to help offset a portion of this unexpected expense with an increase in our subscription rate. We believe our readers know the value of AR and they have responded favorably,” Fournier stated.