Package Coalition Statement on Postal Regulatory Commission Appropriate Share Rulemaking Decision

Washington DC - January 4, 2019 - Following the decision of the Postal Regulatory Commission appropriate share rulemaking proceeding, Package Coalition spokesperson John M. McHugh issued the following statement:


“The Package Coalition is pleased the Postal Regulatory Commission has issued its decision in the appropriate share rulemaking proceeding.  Today’s decision is the result of a two-year deliberative process with input from all stakeholders. The decision is further evidence of the Commission’s commitment to ensuring fair competition between the U.S. Postal Service and private delivery carriers.


“American consumers and businesses, especially given the growth of ecommerce, need a competitive package delivery market in every community of this country, and it is critical in rural America. We are especially pleased to see the Commission reaffirm that the Postal Service is competing fairly with its private competitors, specifically noting there is no evidence to the contrary.  In fact, the decision cites the continuing validity of the Federal Trade Commission’s findings that the Postal Service operates at a net competitive disadvantage relative to its private competitors.


“Congress, in its 2006 Postal Reform legislation, gave the Postal Regulatory Commission the authority to set the appropriate share of the Postal Services’ institutional costs that its competitive package products must cover. The Commission’s new methodology will nearly double the minimum contribution requirement that all competitive postal package products must make to help cover the institutional costs, but will allow the Postal Service to continue to set market-based prices for its competitive postal package products with minimal regulatory interference. The Commission is dedicated to monitoring the delivery services market to ensure that fair competition continues and will adjust its methodology if conditions change.


“The Commission rightly continues to reject arguments to utilize the theory known as fully distributed costs to set pricing. This theory has been repeatedly rejected by economists, the Commission, and the courts.  Finally, the Commission was correct to reject attempts to misuse the regulatory process to force the Postal Service to raise its prices above competitive levels, thereby harming consumers and businesses who rely on and need access to affordable package delivery services.”


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