NEWSPAPER GROUP SUPPORTS RATE HIKE DEAL

Joins Other Mailers in Accepting Early 8.7% Rate Increase

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WASHINGTON (AdAge.com) -- The Newspaper Association of America is the latest group to support a June mail rate hike in return for an agreement by the Postal Service not to impose additional hikes until next year.

That agreement, and rate hike, still needs approval by the Postal Rate Commission. If the rate agreement takes effect, rates aren't expected to rise again until the fall of 2003.

On Sept. 11 the Postal Service announced it was seeking a 3 cent hike in the price of a first-class letter to 37 cents. Direct marketers and publishers were suddenly faced with a rate increase for the third time in little more than 18 months that would average about 8.7% to take effect June 30.

Afraid that the

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Postal Service would use the pending rate case to quickly seek recovery of revenues lost as a result of Sept. 11 and subsequent anthrax problems, direct marketers and magazine publishers earlier this month signed the agreement, which would allow the Postal Service to implement the rate hike two to three months before it normally would take effect.

At the time, the Newspaper Association had some trouble reaching members over the holidays.

In a statement today, the association's president-CEO, John F. Sturm, said the best course of action was "to find an agreement in the pending [rate] case and move forward."

A spokesman for the Postal Rate Commission said it would accept comment on the proposed settlement through Jan. 18.

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