CNS STORY: Charities, periodicals fight postal rate hikes that could sink some

WASHINGTON LETTER Jul-9-2010 (890 words) Backgrounder. With graphic. xxxn

Charities, periodicals fight postal rate hikes that could sink some

By Nancy Frazier O'Brien
Catholic News Service

WASHINGTON (CNS) -- It couldn't come at a worse time.

That's the message coming from Catholic and other charitable organizations, magazine and newspaper publishers and direct mailers in response to the postal rate hikes proposed by the U.S. Postal Service for next year.

"If the rates increase 5 to 10 percent, some organizations have already guesstimated that their income would go down at least 10 percent," said Franciscan Sister Georgette Lehmuth, president and CEO of the National Catholic Development Conference.

Originally called the Catholic Fundraising Conference, the organization based in Hempstead, N.Y., brings together about 300 Catholic dioceses, religious institutes, educational institutions, social services or health-related groups, shrines and pious societies for education, networking and advocacy on their common interests, including postal rates.

The postal service announced a wide-ranging set of proposed price increases July 6, averaging about 5 percent, to cover part of a projected $7 billion loss in 2011. The increases -- which cover first-class and advertising mail, periodicals, packages and other services -- have to be approved by the Postal Regulatory Commission within 90 days in order to take effect Jan. 2, 2011.

Under the plan, first-class mail would increase from 44 to 46 cents for the first ounce and first-class postcards would go from 28 to 30 cents. Periodicals would receive an 8 percent increase, catalog mailings would go up 5.1 percent, standard mail parcels would increase about 23 percent and media/library mail would be subject to a 7 percent rise.

Also under consideration to cover the projected deficit is an end to Saturday mail delivery, but that change would require the approval of Congress and few think such a decision is likely in an election year.

The National Catholic Development Conference -- which includes such heavy hitters as Catholic Charities USA and Catholic Relief Services but also many small charities -- joined with scores of other mail-dependent organizations in a protest of the rate hikes organized by the Affordable Mail Alliance.

To grant the requested price hikes, the Postal Regulatory Commission must waive a rule requiring that postal rate increases stay in line with inflation -- which would keep the increases under 1 percent, the alliance said.

The Postal Accountability and Enhancement Act of 2006 limits such waivers to "extraordinary or exceptional" circumstances, which the alliance said would include another anthrax attack or a major natural disaster, but not an economic recession or bad business practices.

"The first rule of business is if you're in a hole, stop digging," said Tony Conway, executive director of the Alliance of Nonprofit Mailers, at a July 6 news briefing.

"Increasing rates won't put the Postal Service back on track -- it will just drive more customers away, making their situation even worse," he added. "USPS needs to stop avoiding the difficult decisions and stop taking out their problems on the customers they desperately need."

Tom Schmidt, president of Carroll Publishing, which publishes the Spanish-language El Pregonero and the English-language Catholic Standard newspapers in the Archdiocese of Washington, said the increases, if approved, might cause Catholic and other publications to move away more quickly from a print-only model.

He told Catholic News Service July 7 that Carroll Publishing already has been wrestling with ways to "reduce the extent we rely on print" and, like other dioceses around the country, has been "looking for better ways to use a strained resource pool."

Schmidt, who chairs the Catholic Press Association's advocacy committee, said postal rate increases might "hasten people's decisions about what sort of mix they want for their delivery channels."

In the case of Carroll Publishing, if the mail rates for periodicals go up 8 percent as planned, "that's $25,000 I don't have," he added.

But Sister Georgette said the situation is even more dire for charities that rely on direct mailings for most of their donations.

"The Catholic community, like the rest of the nonprofit world, depends on mail as the primary way that people donate," she told CNS July 7.

Citing a new study by the Boston College Center on Wealth and Philanthropy that said U.S. charitable giving was down about 5 percent in 2009, representing a total decrease of $11.2 billion, she said "things are just beginning to turn around."

But charities that provide social services, in particular, "are caught in a big Catch-22," Sister Georgette said, because state and federal funding has dried up while the recession has brought in more people seeking assistance.

Of the proposed postal rate increases, she said, "This is just the worst time for this to happen to us. It would make it much more difficult to support our ministries."

Sister Georgette said studies have shown that those who support charities through direct-mail solicitations will not move easily to other types of appeals.

"There is something about holding a piece of paper in your hands and reading a story with pictures that encourages" people to give, she said.

Even the massive amounts of money given by Internet, phone or text-message donations after Hurricane Katrina or the earthquake in Haiti would not have been possible unless charitable organizations "were already in place to be able to commit money to the services needed" in the disaster areas, Sister Georgette said.

And many of those organizations were built -- and will continue to rely -- on donations received from direct-mail solicitations, she added.

END

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