Postal rate hike rejected, but other changes likely to come

The Postal Service may be in deep financial trouble, but it won't mean consumers will have to pay two-cents more for a stamp come January.

The Postal Regulatory Commission today rejected the Postal Service's request for a 5.6% rate increase. The commission's action wasn't a complete surprise. The Affordable Mailers Alliance, a group of mailers who normally fight among themselves on rate hikes, argued that the proposed increase violates the law, which generally limits rate increases to the cost of living except in extraordinary circumstances.

The Postal Regulatory Commission said the Postal Service, which had blamed the recession and the popularity of e-mail for the "extraordinary circumstance," hadn't fully documented its claim.