Alliance Report May 19, 2026, 26-8

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kathleen Siviter
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Alliance Report                                                          

May 19, 2026

Issue 26/8

 

The leading voice of nonprofits on postal issues for over 45 years.                                                                                        

Copyright 2025: Alliance of Nonprofit Mailers—All rights reserved. 

The Alliance of Nonprofit Mailers is a 501 (c)(4) nonprofit organization established by nonprofits for nonprofits.

 

 

USPS Files for July 2026 Parcel Price Increases and Other Changes

The USPS on May 11, 2026, filed a request with the Postal Regulatory Commission (PRC) to raise some Competitive Services parcel prices and make other changes effective July 12, 2026 (which is the same date the Market Dominant price change is scheduled to take effect).  Highlights from the USPS’ request are below.

  • There are no changes to Priority Mail, Priority Mail Express, Parcel Select prices
  • The dimensional weight calculation will have its divisor changed from 166 to 139 “to better align with industry standards,” per the USPS Board of Governors. The change will apply to Priority Mail Express, Priority Mail, Parcel Select, and Ground Advantage.
  • There are two new Hazardous Materials fees that will be implemented — $7.50 for Priority Mail Express and Priority Mail; $0 initially for Parcel Select and Ground Advantage,
  • All Competitive Services parcels: A Hazmat noncompliance fee of $50 will be applied to any competitive commercial product when Hazardous Materials are detected but the customer did not appropriately declare and label them.
  • Parcel Select: The price for Parcel Select Forwarding and Returns, currently set at $3.80, will increase to $6.00 “in order to better drive address quality.”
  • Parcel Select: For customers using Address Correction Service (ACS) with Shipper Paid Forwarding/Return, the price will increase from $3.20 to $5.40.
  • Parcel Select: The definition of Connect Local will be expanded to allow the use of USPS Smart Lockers as a drop off or pickup location.
  • Ground Advantage: The ounce-based rate differentiation for commercial Ground Advantage will be eliminated.  “This change results in an average price increase of 11.8 percent for USPS Ground Advantage Commercial,” the USPS Board of Governors stated, adding that “Retail prices will remain unchanged.”
  • Competitive Post Office Box prices will be increasing 3.0 percent on average, within the existing price ranges.
  • Classification changes will be made to the definition of Package Intercept so that intercepted packages will use the original product and rate category, rather than always being forwarded or returned via Priority Mail.
  • New for July 2026, an Addresses API service and pricing will be introduced under Address Enhancement Services. The Addresses API service will validate and correct address information to improve package and mail delivery service. Monthly tiered pricing will vary based on the number of record requests. “While the Addresses API service is similar to the existing AMS API service,” the USPS said, “both offerings will continue for the foreseeable future.” “Most customers are expected to migrate to the Addresses API offering over time,” it said.

A copy of the USPS’ filing can be found at https://prc.arkcase.com/portal/filings/139951. 

Alliance Files Comments at PRC on USPS Proposed July 2026 Price Changes

The Alliance of Nonprofit Mailers (ANM) on May 11, 2026, filed its comments with the PRC concerning the USPS’ proposed July 2026 price changes.

The Commission Must Freeze Market Dominant Price Changes Until Corrections are Made to the Rate-Making System.  The Alliance maintained its previously stated position that USPS price changes should be paused until the Commission completes its review of the ratemaking system.  “The Commission has now determined that the existing ratemaking system does not meet the objectives of 39 U.S.C. § 3622(b), taking into account the factors in 39 U.S.C. § 3622(c),” ANM said.  “Continuing to allow the USPS to raise prices under the current noncompliant system perpetuates the significant flaws the Commission itself has determined need correcting,” the association said.

Responding to the Commission’s stated position in the July 2025 price change proceeding, ANM said it “strongly disagrees that the Commission ‘has no statutory or regulatory basis’ to reject the Postal Service’s proposed rate hikes.”  “The notion that the Commission has the authority to completely redesign the rate-making system, and has the authority to limit the Postal Service to one price increase for market-dominant products per fiscal year, but does not have the authority to pause price increases until it completes its rate-making system review is at best is in tension with, and at worst is a clear violation of, its role to protect monopoly users of the mail,” the Alliance told the PRC.

The Alliance noted that the PRC in its FY2025 Annual Compliance Determination (ACD) states that its “significance lies in protecting consumers and businesses from monopoly pricing, working to make sure the Postal Service doesn’t compete unfairly with the private sector, and supporting the Postal Service’s financial stability and provision of universal service, which is especially critical for rural and low-income Americans who are more reliant on the mail.”   “Allowing the Postal Service to continue the magnitude of price increases that have already harmed nonprofit organizations’ ability to use the mail to support their critical missions — which are especially critical for rural and low-income Americans who are more reliant on the mail — is clearly in conflict with the Commission’s stated role,” it said.

Price Changes of this Magnitude will Further Accelerate Nonprofit Mail Declines and Harm Nonprofit Mailers.  The Alliance strongly opposed the implementation of “yet another price increase significantly above CPI that will further drive nonprofit mail out of the system and harm nonprofit mailers’ ability to use mail to accomplish their critical missions – in many cases because mail remains the only viable option to serve rural communities in the U.S.”

“According to an updated analysis by Quad,” ANM said, “the compounded price increases on the mail products nonprofit organizations purchase have been acute for the period 2021 through the proposed July 2026 change.”  It continued,

“The compounded price change between January 2021 – July 2026 on FCM letters is 62.2 percent, and is nearly double that on FCM flats (a whopping 106.0 percent).  Marketing Mail nonprofit flats, both per piece piece and per pound categories, face massive compounded increases of 105.6 percent and 85.5 percent, respectively.  The compounded rate hikes over this time period for Periodicals are also significant: 95.5 percent (in-county) and 73.6 percent (outside county).”

“Nonprofit Periodicals volume has declined 20% since 2021 (compared to 11% from 2016-2020, and 6.1% from 2011-2015),” the Alliance said.  “Nonprofit Marketing Mail volume has declined 12.4% since 2021 (compared to 7.5% from 2016-2020 and 5.7% from 2011-2015),” it continued.  “These accelerated rates of volume decline likely telegraph that continued above-CPI price increases will harm nonprofit organizations’ ability to use the mail, and further exacerbate volume losses,” the Alliance told the PRC.

The USPS’s Proposed Changes to Outside County Periodicals Will Continue to Significantly Harm Nonprofit Periodicals Organizations.  The Alliance raised concerns and questions about the magnitude of proposed price increases for nonprofit Periodicals mailers, “despite increases in workshare discounts and incentives and highly efficient mail preparation.”

“Although the Postal Service in its proposed price filing states the average price increase for Outside County Periodicals is 6.562%,” ANM noted, “many Alliance members mailing Outside County nonprofit Periodicals are reporting that software modeling available to date indicates they will see double digit price increases.”  “It is difficult to compare the current Periodicals rate structure and prices to the new structure proposed by the USPS,” the Alliance acknowledged, but noted that “initial software modeling being performed by industry is showing significant price increases for many Periodicals, particularly for lighter weight pieces paying per piece rates.”

“It is mystifying that in a proposed price change where the Postal Service is increasing the workshare discounts for Carrier Route and High Density Outside County Periodicals, as well as increasing the IMb Full-Service incentive, and offering new sort and container discounts (all of which we commend the Postal Service for proposing), the net price increases being seen by some Alliance members are still in the double digits,” ANM commented.  Referring to the many nonprofit rural electric cooperatives that sent letters to the PRC opposing the USPS’ proposed removal of the CPI price cap, the Alliance noted that “[t]hese rural electric cooperatives represent just one industry segment using nonprofit Periodicals that has been devastated by greater-than-CPI price increases since 2021.”  “In addition to the impacts on nonprofit Periodicals users from the price increases,” the association said, “service performance for Periodicals continues to decline, meaning these users are essentially paying significantly more for significantly worse service.”  The Alliance stated,

“We appreciate the Commission’s diligence in ensuring that the Postal Service has accurately calculated the Periodicals increase for purposes of price cap compliance, given all the changes to the Periodicals rate design.  If the USPS’ calculations are accurate, the Alliance asks that the Postal Service and the Commission consider a phasing in of the new price structure in a manner that does not result in double digit price increases being implemented at one time because the impact on these mailers will be catastrophic on top of the huge increases they have already experienced the past five years under the flawed rate-making system design.  Since the USPS repeatedly shared its forecast of a 6.8% average price increase for the Periodicals category, nonprofit Periodicals mailers have not budgeted for the double-digit increases they likely are facing.”

The Alliance also asked the PRC to “reconsider its order that the Postal Service assess the non-compensatory rate authority (additional 2%) on Periodicals as mailers transition from the current pricing structure to the new one,” reminding the PRC that “[t]his additional rate authority is optional and may be used at the Postal Service’s discretion.”   “Since the Commission in its FY2025 ACD ordered the USPS to use the non-compensatory additional rate authority for the Periodicals mail class, the Commission would need to rescind that order,” ANM said, noting that it “also believe[s] that there are categories within Periodicals (e.g., Periodicals that are more than 50% High Density/Saturation) that do cover their costs.”  The Alliance urged the PRC to “explore ways to not penalize such compensatory categories with the non-compensatory additional rate authority.”

A complete copy of the Alliance’s comments can be found here https://prc.arkcase.com/portal/filings/139955.  The PRC is expected to issue its decision on the July 2026 price change around the end of May.

Updated July 2027 Price Change Forecast

The Bureau of Labor Statistics on May 12, 2026 released the April 2026 CPI, which increased by 3.8 percent from April 2025 and by 0.6 percent from March 2026 (seasonally adjusted).  That brings the USPS CPI price cap authority for a July 2027 price increase to 0.583 percent.

The below table, prepared by SLS Consulting, provides an updated estimate for July 2027 USPS rate authority under the existing Market Dominant ratemaking system.  Given the substantial recent increases and volatility in energy costs, these estimates are subject to heightened uncertainty and may change.  Also, keep in mind that there is an open proceeding before the Postal Regulatory Commission (PRC) to make changes to the ratemaking system, which could significantly impact what happens in 2027 with USPS price changes.   The USPS has also said that the Density additional rate authority is likely to be significantly higher in 2027 than it is in 2026 because the comparison years do not include election mail, which brings additional volume to the equation.

The Alliance will continue to provide updated estimates over time.

PRC Commissioner Says USPS “RTO” Initiative has Not Achieved Projected Financial Result

Postal Regulatory Commissioner Tom Day on May 12, 2026, posted on LinkedIn an analysis of the USPS’ Regional Transportation Optimization (RTO) initiative’s financial results to date.  “The first year of Regional Transportation Optimization (RTO) is now complete and the results are in,” Day said.  He noted,

“The data used to analyze the result is from the USPS publicly reported Monthly Financial Performance. The RTO plan announced by USPS projected savings were to be achieved by reduced Transportation Costs and reduced Processing Operations resulting from improved Mail Flow. In order to fully measure the cost impact, ‘Other Operating Expenses’ which includes USPS Internal Transportation costs, is included in the analysis.”

“In the 6 months that preceded the implementation of RTO, USPS reduced these total costs by $63M,” the PRC Commissioner noted. “This amount likely would have been  greater if not for costs associated with the 2024 Election Mail,” he said.  “In the 1 year since RTO was implemented costs increased by $831M,” Day posted.  “Again,” he said, “there is some influence from the lower costs associated with only local elections.”  “The total cost increase might have been slightly higher,” he noted.

“Bottom-line,” Commissioner Day said, “a shift from a $63M (annualized to $125M) REDUCTION; to a $831M INCREASE.”  “Approximately a $1 Billion negative shift,” he said, concluding “[t]here is no sign that RTO achieved the financial result that had been projected.” He included the below chart with his analysis.

USPS OIG White Paper Looks at Government Services Opportunities for USPS

The USPS Office of Inspector General (OIG) on May 14, 2026, published a white paper, “Expanding Access to Government Services Through the Postal Network,” that assesses the USPS’ ability to offer government services beyond what it has in the past.

The Postal Service Reform Act (PSRA), enacted in 2022, broadened the USPS’ authority to partner with government agencies beyond the federal level to allow it to provide nonpostal services to state, local and tribal governments.  “These services are strictly limited to core government functions,” the OIG noted, “or services provided on behalf of government agencies that prioritize public value and accessibility, such as lowering costs or increasing community convenience, rather than operating for the sole purpose of financial gain.”  “Under the PSRA,” it explained, “government services must satisfy three primary criteria: they must provide a clear public benefit, maintain operational integrity by not interfering with core postal duties, and ensure full cost coverage by generating revenue that accounts for at least 100 percent of attributable costs.”

The USPS’ existing government services portfolio includes activities such as passport services (which typically have represented 80% of the revenue from these activities), identity verification services, leasing of USPS-owned property, distribution of critical supplies (like the COVID-19 test kit program), providing address-related postal data, and support for processing EEO (Equal Employment Opportunity) claims for other federal agencies.  The OIG found that for FY2025, nonpostal government services generated $387 million in revenue for the USPS, and noted that in FY2022 the revenue surged to over $1.46 billion due to the COVID test kit fulfillment program.

The OIG reported that even though the USPS’ authority for nonpostal government services was expanded beyond the federal level from the PSRA in 2022, the USPS “does not have IAAs [Inter-Agency Agreements] with state, local, or tribal entities, and has not yet initiated outreach or systematic efforts to assess the interest, service needs or technical requirements of non-federal government agencies.”

The OIG said that to identify strategic opportunities, it “interviewed federal stakeholders (including the Federal Communications Commission and the U.S. Treasury Inspector General for Tax Administration), held deep-dive discussions with state officials in Colorado, Texas, and New Mexico, and engaged with the National Governors Association.”  It noted,

“USPS OIG discussions with state and federal officials highlight the untapped potential of new government partnerships, particularly in rural and underserved areas where the post office often serves as a primary civic hub. Potential growth is evident in providing in-person identity verification for social benefit programs like SNAP or Medicaid, and in streamlining high-assurance biometric services, such as fingerprinting for state professional licensing. Facilities could also transform into digital access points by hosting DMV or IRS kiosks in “service deserts” where residents currently travel long distances for simple renewals or tax assistance. Additionally, USPS could lease rooftop space for 5G and broadband infrastructure to help bridge the digital divide in the thousands of underserved counties it already serves.”

“Future possibilities also include equipping the delivery fleet with sensors for passive data collection on air quality and road conditions,” the OIG said, “and leveraging the last-mile network to report infrastructure failures during national disasters.”

The OIG researched what posts in other countries that have successful government service portfolios have done.  “To turn these concepts into reality,” it said, “the Postal Service could look toward international peers in Australia, France, and Italy, which have built successful government service portfolios through proactive sales teams and centralized management units.”  “These operators thrive by standardizing their offerings to lower technical costs and using market intelligence to target areas where private competition is absent,” it noted.

The OIG white paper includes discussion of specific potential opportunity areas identified by government agencies, including expanded identity services, expanded facility leasing opportunities, self-service kiosks, leasing rooftop space, collecting nonpostal data from postal vehicles, services by mail carriers, and emergency fulfillment services.

The OIG concluded that “[c]urrently, the Postal Service’s approach to government partnerships remains largely reactive and fragmented across multiple departments.”  “To capitalize on its vast infrastructure and the interest expressed by state agencies,” it said, “the OIG recommends postal leadership develop a unified strategic roadmap.”  “This plan would outline the steps necessary to identify, evaluate, and prioritize expansion opportunities across all levels of government, finally moving the organization beyond case-by-case federal agreements toward its vision of a modern, multi-level government storefront,” it concluded.

The USPS largely agreed with the OIG’s recommendation to develop a government services strategic roadmap.  “The Postal Service intends to formalize and refine previous evaluation efforts into a roadmap featuring a structured, phased approach to assessing partnership opportunities,” the OIG said, noting that “[t]he target implementation date is May 31, 2027.” 

USPS Executive Retirements & Appointments

The USPS on May 11, 2026, announced that Janine Egloff has been appointed to the executive position of Senior Director, Product Acceptance and Support, the position recently vacated by the retirement of Randy Workman. Egloff previously served as the Director, Pricing Classification Service Center (PCSC).

The USPS on May 13, 2026, announced that Jason DeChambeau has been named Vice President, Processing Operations.  DeChambeau had been acting in the position since January 1, 2026.

Beyond USPS.com…

Hopefully all our readers are familiar with the USPS.com website, where you can find a wealth of information on sending and receiving mail, postal retail products, business services and international mailing information.  But there are other USPS websites with information that may not be as well known…

About USPS (https://about.usps.com/welcome.htm).  The About USPS website contains more information about the organization itself, including org charts, lists of USPS leadership and its Board of Governors, recordings of past Board of Governors meetings, government relations and law department information, stamp committee and selection information, the USPS strategic plans, financial and service performance reports, sustainability and security information, local and national postal news and service alerts, postal facts, postal history, and USPS publications, handbooks, and forms.

USPS Delivers (https://www.uspsdelivers.com/).  USPS Delivers is designed to provide insights on shipping, logistics, marketing and engagement with a focus on mail and parcels.  There are some great resources to be found here – if we were to make suggestions for improvement it would be to add new content more regularly and also date the articles and keep the data current.

Postal Explorer (https://pe.usps.com/). Postal Explorer is a great online resource for accessing the USPS Domestic Mail Manual (DMM), International Mail Manual (IMM), Publication 417 (Nonprofit USPS Marketing Mail Eligibility – note a few updates are in order), Customer Support Rulings (CSRs), Industry Alerts, pending updates to the DMM and IMM, and USPS price lists and upcoming price change information.

Postal Pro (https://postalpro.usps.com/).  PostalPro provides more in-depth and user-friendly information on postal products and services, including Promotions, Informed Visibility, Election Mail, the Mailer Scorecard, Address Quality solutions, the Mailers Technical Advisory Committee (MTAC), Postal Customer Councils (PCCs), AIM (Areas Inspiring Mail) meetings, and much more.  To check for recent updates, go to https://postalpro.usps.com/resources-list.

Business Customer Gateway (https://gateway.usps.com/eAdmin/view/signin).  The Business Customer Gateway, or BCG, requires log in credentials and is where a mail owner or mail service provider can get information specific to their mailings. Mailers can use the BCG services to create artwork for reply mail, manage their Mailer ID (MID) and mailing activity, make appointments in the FAST system, access the USPS Ship system and many more services to manage your mail and shipping.

USPS Service Performance Information.  Though not all located on one USPS website, those looking for information on service performance should check these:

  • USPS Service Alerts and Disruption Information. https://about.usps.com/newsroom/service-alerts/ This area of USPS.com provides lists of specific ZIP Codes where service has been disrupted, as well as postal facilities not accepting drop shipments and international postal disruptions.

You can also use the tool at https://about.usps.com/what/performance/service-performance/historical_trends/index.html to pick your own time period to see past quarterly reports for a longer period than one quarter.

For close to real time service performance, try the IMb Planning Tool at https://iv.usps.com/imb-planning-tool/, which shows data only a few days old.  The USPS Public Service Performance dashboard (see below) shows data more recent than the last quarter, but not as real time as the IMb Planning Tool.

The USPS Office of Inspector General (USPS OIG) has also developed a Focus Area on its website for USPS Service Performance data (https://www.uspsoig.gov/focus-areas/service-performance) with user-friendly interactive tools and colorful map displays to see quarterly service performance.

Of course to see performance data for a specific mailing or mailpiece, mailers must use barcodes on pieces, handling units and containers and subscribe to a USPS or other provider service to obtain their tracking data.

Into the Postal Weeds…

For those who live in the “postal weeds,” and are looking for news on mail entry, preparation, discounts, incentives, and more, this column in the Alliance Report will be right up your alley!  We won’t go all the way into the weeds…but we will offer up highlights on useful resources and mailing standard changes.

  • Registration Deadline – Mail Growth Incentives 2026 — Final opportunity to register for a chance to earn 30% postage credit! May 31st, 2026, is the last day to initiate registration to participate in the 2026 Mail Growth Incentives and both the mail owner and the Postal Service must agree to the baseline on or before June 30th, 2026.  As a reminder – Registration for the First-Class Mail and Marketing Mail Growth Incentives is to be done in the My Products Portal, accessed through the Business Customer Gateway.  Even if an MGI 26 registration was system-initiated based on a 2025 MGI registration, the SR Owner must still take action (agree with baseline or initiate a discussion) by May 31st.   

Once registration is initiated, a Service Request (SR) is opened and all communications between registrant and USPS need to occur within the Service Request. This streamlines communication, allowing easy access across the organization in a centralized location.  Registrants should promptly review the baseline volume and associated CRIDs shown within the registration Service Request – accessible in the Related Tab.  If the volume and CRID information match the mail owner records, the registrant should click on the “I Agree” button to complete the registration process from their side. If the information does not match, or the mail owner would like to discuss further, they should click the “Registration Assistance” button in the SR and select the type of discussion needed. Discussions can take time to investigate and review data to reach consensus among all parties. Any registrations in discussion and not finalized by June 30th will be ineligible to participate, even if baseline discussions were initiated prior to May 31st but not agreed to by both the Postal Service and the registrant by June 30th.  Detailed information including Frequently Asked Questions, Terms and Conditions, and recorded presentations are available on PostalPro in Mail Growth Incentives under “Resources” Link: Mail Incentives | PostalPro

 

 

 

 

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