Court Opinion

ID: 4438085
Source: CourtListenerOpinion
Date Created: 2019-09-13 15:00:52.597319+00
Date Added: 2024-06-11T14:51:14.132737
License: Public Domain

United States Court of Appeals
         FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued May 10, 2019                Decided September 13, 2019

                         No. 18-1328

                   DOUGLAS F. CARLSON,
                       PETITIONER

                              v.

             POSTAL REGULATORY COMMISSION,
                      RESPONDENT

 PITNEY BOWES INC. AND UNITED STATES POSTAL SERVICE,
                     INTERVENORS

             On Petition for Review of an Order
            of the Postal Regulatory Commission

     Douglas F. Carlson, Pro se, argued the cause and filed the
briefs for petitioner.

    Joshua M. Salzman, Attorney, U.S. Department of Justice,
argued the cause for respondent. With him on the brief were
Michael S. Raab, Attorney, David A. Trissell, General Counsel,
Postal Regulatory Commission, Anne J. Siarnacki, Deputy
General Counsel, and Laura E. Zuber, Attorney.

    Before: MILLETT, KATSAS, and RAO, Circuit Judges.
                               2
    Opinion for the Court filed by Circuit Judge RAO.

     RAO, Circuit Judge: Wedding invitations, birthday cards
from grandma, and electricity bills all travel through the United
States Postal Service with a simple first-class stamp. Perhaps
unnoticed by many who use the “Forever Stamp,” in January
2019, the Postal Service raised the price of this stamp by five
cents, a ten-percent increase. Douglas Carlson’s pro se petition
challenges this stamp price hike, which is part of Postal
Regulatory Commission Order 4875, 1 as inconsistent with the
Administrative Procedure Act (APA).

     We agree with Carlson that the stamp price hike did not
meet the APA’s requirements for reasoned decisionmaking.
The Commission failed to provide an adequate explanation of
the increase and, relatedly, failed to respond to public
comments challenging the increase under relevant statutory
factors and objectives included in the Commission’s organic
statute, the Postal Accountability and Enhancement Act
(PAEA). Accordingly, we grant the petition for review and
vacate the part of Order 4875 addressing rate adjustments for
the category of first-class mail. Because the category of first-
class rates is severable, we leave the remainder of the Order
intact.

                               I.

    We begin with the statutory requirements governing the
Commission. In enacting the PAEA, Congress moved from an
adjudicatory model of postal rate review to a regulatory one.
“[A]dministrative procedures are divided into two categories,”
adjudication and rulemaking, with the latter defined as
“prospective decisions of general applicability focusing on

1
 Postal Regulatory Comm’n, Order No. 4875, Dkt. R2019-1 (Nov.
13, 2018), J.A. 186.
                                 3
policy.” 2 Charles H. Koch, Jr. & Richard Murphy,
Administrative Law & Practice § 5:1 (3d ed. 2019). Regulation
“is primarily concerned with policy considerations” while
“adjudication is concerned with the determination of past and
present rights and liabilities.” Bowen v. Georgetown Univ.
Hosp., 488 U.S. 204, 219 (1988) (Scalia, J., concurring)
(quoting Attorney General’s Manual on the Administrative
Procedure Act 14 (1947) (“AG Manual”)).

     Before the PAEA, adjudication of postage rates was a
lengthy process that delayed rate changes by as much as
eighteen months. S. Rep. No. 108-318, at 3–4 (2004). The
PAEA reconstituted the Postal Rate Commission as the Postal
Regulatory Commission, an agency headed by five
commissioners appointed by the President and removable only
for stated causes. 2 See 39 U.S.C. §§ 501–02. The PAEA
strengthened the role of the Commission by repealing the
Postal Service’s authority to modify rates without the

    2
      From 1789 to 1970, the Post Office Department administered
the Nation’s mails. See Act of Sept. 22, 1789, ch. 16, 1 Stat. 70.
Between 1970 and the enactment of the PAEA in 2006, Congress
abolished the Post Office Department and divided ratemaking
authority between the Postal Service and the Postal Rate
Commission, two distinct agencies. See Postal Reorganization Act of
1970, 84 Stat. 719; see also Nat’l Ass’n of Greeting Card Publishers
v. U.S. Postal Serv., 462 U.S. 810, 813, 821 (1983). Under the prior
Act, the Postal Service initiated rate changes by submitting requests
to the Postal Rate Commission with “such suggestions for rate
adjustments as it deem[ed] suitable.” 39 U.S.C. § 3622(a) (2000).
The Postal Rate Commission then conducted a hearing on the record
and determined what rate to recommend to the Postal Service, taking
into account nine statutory factors. Id. §§ 3622(b), 3624(a). The
Postal Service had authority to challenge the Commission’s rate
recommendation and, in some circumstances, to reject the
Commission’s recommendation and impose its own modifications.
Id. § 3625.
                              4
Commission’s approval. See PAEA, Pub. L. No. 109-435,
§ 201(b), 120 Stat. 3198, 3205 (2006) (repealing 39
U.S.C. § 3625). The PAEA also abolished the requirement for
the Commission to hold a hearing on the record prior to
adopting any rate change. Id. (repealing 39 U.S.C. § 3624).
Instead, Congress directed the Commission to establish “a
modern system for regulating rates and classes for market-
dominant products.” 39 U.S.C. § 3622(a).

     Rather than adjudicate rates through fact-intensive
hearings, the PAEA requires the Commission to establish a
regulatory system for rate approval and then evaluate and
approve specific postal rates through rulemaking, subject to
review under the standards of the APA. Id. §§ 3622, 3663.
Because “[t]he APA does not contemplate the use of
adjudication to develop rules,” Ala. Power Co. v. FERC, 160
F.3d 7, 11 n.5 (D.C. Cir. 1998), Congress’s decision to replace
the Commission’s adjudicatory model with a regulatory model
guided by APA standards is significant. See Bowen, 488 U.S.
at 218 (“The entire [APA] is based upon a dichotomy between
rule making and adjudication.” (quoting AG Manual)).

     The PAEA dictates that the Commission’s regulatory
system “shall be designed” to achieve nine statutory objectives
and “shall take into account” fourteen statutory factors. 39
U.S.C. § 3622(b)–(c) (reproduced in Appendix, infra). The
Commission established the required “modern system for
regulating rates” in November 2007. See generally Postal
Regulatory Comm’n, Order No. 43, 72 Fed. Reg. 63,662 (Nov.
9, 2007) (the “system regulation”). The part of the system
regulation relevant to this case addresses rate adjustments of
general applicability. See 39 C.F.R. pt. 3010, subpart B. Under
the system regulation, the Postal Service initiates a proposed
rate change by providing notice to the public and to the
Commission. Id. § 3010.10(a). Such notice must be provided
                               5
at least forty-five days prior to a rate change, and the Postal
Service is encouraged to provide as much advance notice as
practicable. Id. § 3010.10. The Postal Service’s notice must
include, among other things, “[a] discussion that demonstrates
how the planned rate adjustments are designed to help achieve
the objectives listed in 39 U.S.C. § 3622(b) and properly take
into account the factors listed in 39 U.S.C. § 3622(c).” Id.
§ 3010.12(b). The notice must also include any “other
information” that would assist the Commission in issuing “a
timely determination of whether the planned rate adjustments
are consistent with applicable statutory policies.” Id.
§ 3010.12(b)(12). The Postal Service’s notice serves as the
proposed rule before the Commission issues a final regulation,
i.e., the rate approval order.

    After receiving notice from the Postal Service, the
Commission establishes a docket allowing twenty days for
public comment on the proposed change. Id. § 3010.11(a).
Within fourteen days of the end of the comment period, the
Commission must “issue an order announcing its findings.” Id.
§ 3010.11(d). The system regulation does not specify how the
Commission must consider the PAEA’s objectives and factors;
however, rate adjustments must be “consistent with applicable
law.” Id. § 3010.11(e), (i). If the Commission finds that a
proposed rate adjustment is inconsistent with applicable law,
the Postal Service must amend its notice, include “sufficient
explanatory information to show that all deficiencies identified
by the Commission have been corrected,” and allow an
additional seven-day period of public comment. Id.
§ 3010.11(f), (g).

    The Postal Service proposed the stamp price hike in
October 2018 as part of a series of adjustments to the category
                                6
of first-class postage rates. 3 See U.S. Postal Serv., Notice of
Market-Dominant Price Change, Dkt. No. R2019-1 (Oct. 10,
2018), J.A. 1. Under the proposal, the rate for a one-ounce,
stamped letter would increase from fifty cents to fifty-five
cents. This ten percent increase required the Service to adjust
other classes of first-class postage rates in order to stay within
the overall statutory price increase cap of about 2.5 percent. See
39 U.S.C. § 3622(d)(1)(A). The proposal thus decreased the
price of some first-class mail products and increased others by
a smaller percentage. The stamp price hike, however, was
remarkable—the largest absolute increase in the price of
stamps since 1863. 4 As a percentage, it was the largest increase
since 1995. 5

     The Postal Service justified the magnitude of the stamp
price hike by asserting an interest in keeping the price of stamps
“at round numbers divisible by five.” J.A. 8. According to the
Postal Service, this approach helps to achieve “simplicity of
structure”—one of the fourteen factors under the PAEA, see 39
U.S.C. § 3622(c)(6)—by “facilitat[ing] convenience for retail
customers” through “a straightforward, understandable pricing
structure.” J.A. 8–9. The Postal Service sought to minimize
concern about the size of the stamp price hike by asserting that
corresponding reductions in postage rates for first-class mail
products with nonstandard weight or shape would mitigate the
impact of the increased price of first-class letter stamps.
Moreover, the Service stated its intent to keep stamp prices
divisible by five in future years, suggesting that a large increase

    3
      The first-class postage adjustments were part of a notice to
adjust rates across several other categories of market-dominant
products. Those other rates are not challenged here.
    4
      See U.S. Postal Serv., Rates for Domestic Letters Since 1863
(Feb.        2019),       https://about.usps.com/who-we-are/postal-
history/domestic-letter-rates-since-1863.pdf (listing rates).
    5
      See id.
                                7
in the price of stamps in 2019 might postpone the need for
another increase, “subject to the business conditions that obtain
in coming years.” J.A. 9.

    The Commission opened a docket to receive public
comment for the required twenty days. See Postal Regulatory
Comm’n, Order No. 4851, 83 Fed. Reg. 52,242 (Oct. 16, 2018).
During this time, the Commission received thirty-four
comments, including a comment from Carlson, a postal
customer and watchdog. See Carlson v. U.S. Postal Serv., 504
F.3d 1123 (9th Cir. 2007).

     Carlson raised a series of arguments against the stamp
price hike, including that the Service failed to account for
several statutory objectives and factors. First, Carlson argued
that keeping the price of a stamp divisible by five did not
promote the value of “simplicity of structure” under 39 U.S.C.
§ 3622(c)(6). J.A. 95–100. Second, he disputed the Postal
Service’s evaluation of the stamp price hike’s likely impact and
argued that the detrimental “effect of rate increases upon the
general public” weighed against the Postal Service’s proposal
under 39 U.S.C. § 3622(c)(3). J.A. 103–05. Third, he argued
that raising the price of stamps by five cents was inconsistent
with the statutory objective of “establish[ing] and
maintain[ing] a just and reasonable schedule for rates” under
39 U.S.C. § 3622(b)(8). J.A. 104. The Greeting Card
Association similarly commented on flaws in the Postal
Service’s simplicity-of-structure rationale and noted the need
to consider other statutory factors. J.A. 111–16. The
Association for Postal Commerce argued that increasing the
price of stamps in five-cent increments could reduce
“predictability and stability in rates,” contrary to the statutory
objective under 39 U.S.C. § 3622(b)(2). J.A. 89.
                                8
     After the close of the public comment period, the
Commission issued Order 4875. The Order included a finding
that the overall first-class mail rate adjustments, including the
stamp price hike, were “consistent with 39 U.S.C. §§ 3622(d)
and 3622(e), and may take effect as planned.” J.A. 250. The
Order referenced, but did not resolve, Carlson’s disagreement
with the Postal Service’s simplicity-of-structure rationale.
Instead, the Order encouraged the Postal Service “to
collaborate with mailers . . . about pricing” in order to reassess
the utility of keeping stamp prices divisible by five in the
future. J.A. 209. Aside from “simplicity of structure,” the
Commission did not cite any of the PAEA objectives and
factors listed in subsections 3622(b) and (c), but instead
evaluated the increase only for compliance with quantitative
rate caps established by other provisions of the PAEA. The
Commission determined that the Postal Service’s proposal
complied with the rate cap and approved the rate increase,
stating that “subject to certain limitations, most prominently
the price cap, the PAEA gives the Postal Service pricing
flexibility within First-Class Mail.” J.A. 208–09.

     Carlson timely petitioned this Court for review of the first-
class rate adjustments in Order 4875, arguing that the stamp
price hike violated the APA because the Commission failed to
consider relevant statutory objectives and factors and failed to
provide a reasoned explanation of the exercise of its authority
under the system regulation. The PAEA grants this Court
jurisdiction over orders or decisions of the Commission and
incorporates the APA as the framework for review. 39 U.S.C.
§ 3663; see also GameFly, Inc. v. Postal Regulatory Comm’n,
704 F.3d 145, 148 (D.C. Cir. 2013). Because Carlson is
proceeding pro se, we construe his filings liberally. See, e.g.,
United States v. Gooch, 842 F.3d 1274, 1278 (D.C. Cir. 2016).
                                9
                               II.

     Carlson claims that the stamp price hike is arbitrary and
capricious under the APA because the Commission failed to
consider the objectives and factors listed in the PAEA. The
Commission agrees that these statutory factors and objectives
are relevant to rate review, but maintains that it has discretion
to defer consideration of those provisions until after approving
a rate change, especially given its interpretation that the PAEA
requires the Commission to evaluate rate-change proposals
quickly.

     We conclude that the Commission’s consideration of this
increase fell short of the APA’s requirements for reasoned
decisionmaking because the Commission failed to provide an
adequate explanation for the stamp price hike, and, relatedly,
failed to respond to public comments challenging the stamp
price hike under the PAEA’s statutory factors and objectives.
Moreover, the PAEA does not require the Commission to rush
to decision. Based on the text and structure of the PAEA, we
conclude that the PAEA requires consideration of all relevant
statutory objectives and factors as part of the regulatory process
and does not authorize the Commission to defer evaluation of
those objectives and factors until after it approves a rate
change. Finally, the system regulation requires the
Commission to determine that proposed rate adjustments are
“consistent with applicable law,” 39 C.F.R. § 3010.11(e),
before issuing a rate approval order. At a minimum, this also
required the Commission to comply with the APA and the
PAEA by weighing the statutory factors and objectives before
adopting the stamp price hike.

                               A.

     The stamp price hike is part of Order 4875, which is a
“rule” within the meaning of the APA because it is an
                                10
“approval . . . for the future of rates.” See 5 U.S.C. § 551(4);
see also Order No. 43, 72 Fed. Reg. at 63,666 (“The notice and
comment guarantees of section 553 of the APA apply to . . .
rate adjustments.”). When reviewing a rule under the APA, we
will set aside an order that is “arbitrary, capricious, an abuse of
discretion, or otherwise not in accordance with law” or that is
“in excess of statutory jurisdiction, authority, or limitations, or
short of statutory right.” 5 U.S.C. § 706(2)(A), (C). “The
APA’s arbitrary-and-capricious standard requires that agency
rules be reasonable and reasonably explained.” Nat’l Tel.
Coop. Ass’n v. FCC, 563 F.3d 536, 540 (D.C. Cir. 2009). An
agency violates this standard if it “entirely fail[s] to consider
an important aspect of the problem.” Motor Vehicle Mfrs. Ass’n
v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43 (1983). An
agency also violates this standard if it fails to respond to
“significant points” and consider “all relevant factors” raised
by the public comments. Home Box Office, Inc. v. FCC, 567
F.2d 9, 35–36 (D.C. Cir. 1977).

    Accordingly, an agency must respond to comments “that
can be thought to challenge a fundamental premise” underlying
the proposed agency decision. MCI WorldCom, Inc. v. FCC,
209 F.3d 760, 765 (D.C. Cir. 2000). An agency need not
“discuss every item of fact or opinion included in the
submissions made to it.” Del. Dep’t of Nat. Res. & Envtl.
Control v. EPA, 785 F.3d 1, 17 (D.C. Cir. 2015) (citation
omitted). An agency’s response to public comments, however,
must be sufficient to enable the courts “to see what major issues
of policy were ventilated . . . and why the agency reacted to
them as it did.” Id. (citation omitted). Even when an agency
“has significant discretion in deciding how much weight to
accord each statutory factor,” that does not mean it is “free to
ignore any individual factor entirely.” Tex. Oil & Gas Ass’n v.
EPA, 161 F.3d 923, 934 (5th Cir. 1998) (citing Weyerhaeuser
Co. v. Costle, 590 F.2d 1011, 1045 (D.C. Cir. 1978))
                               11
(evaluating agency’s consideration of statutory factors under
arbitrary-and-capricious review).

     The PAEA sets forth a framework of statutory objectives
and factors for consideration in rate setting. While the statute
does not specify how these objectives and factors must be
accounted for in any particular rate order, the Commission
must apply the relevant objectives and factors to individual rate
adjustments. Our cases confirm this and provide some limited
guidance. We have held that “[i]n reviewing [proposed] rates
for market-dominant products, the Commission must consider
the statutory factors set out in 39 U.S.C. § 3622(c).” Newspaper
Ass’n of Am. v. Postal Regulatory Comm’n, 734 F.3d 1208,
1210 (D.C. Cir. 2013). The factors listed in the PAEA
“establish[] rate requirements for all market-dominant
products.” Id.; see also U.S. Postal Serv. v. Postal Regulatory
Comm’n, 676 F.3d 1105, 1107 (D.C. Cir. 2012) (for purposes
of the Commission’s annual compliance determination, “the
PAEA provides the Commission with fourteen factors to
consider when reviewing Postal Service rates” in effect during
the preceding year).

     Congress left the Commission leeway to establish, through
regulation, a process for considering the PAEA’s objectives
and factors. 39 U.S.C. § 3622(a)–(c). We recognize that not
every statutory factor and objective will be relevant to an
individual rate assessment and that the weight accorded
particular factors may therefore vary in each case. But this does
not mean the Commission may simply disregard the objectives
and factors when approving rate adjustments. Pursuant to the
APA, the Commission’s orders must be “reasonable and
reasonably explained.” Nat’l Tel. Coop. Ass’n, 563 F.3d at 540.

   Indeed, the Commission has long recognized that the
PAEA’s objectives and factors are relevant to the assessment
                               12
of postage rates. See Order No. 43, 72 Fed. Reg. at 63,665
(explaining that the system regulation requires the Postal
Service to address statutory objectives and factors as part of “a
broad range of relevant issues in any notice of rate
adjustment”); Postal Regulatory Comm’n, Order No. 203, 74
Fed. Reg. 20,834, 20,841 (May 5, 2009) (stating that Order 43
implemented “a system of ratemaking to foster achievement of
the requirements, objectives, and factors spelled out in” 39
U.S.C. § 3622(b)–(c)). Similarly, in this case, the Commission
acknowledges that lack of compliance with the objectives and
factors can justify disapproval of a rate-change proposal and
that the objectives and factors are relevant in the annual
compliance review and adjudication of complaints.

     Moreover, consideration of the statutory factors is
implicitly required by the Commission’s system regulation.
Under the system regulation, the Postal Service’s initial notice
to the Commission of a proposed rate change must include “[a]
discussion that demonstrates how the planned rate adjustments
are designed to help achieve the objectives listed in 39 U.S.C.
§ 3622(b) and properly take into account the factors listed in
39 U.S.C. § 3622(c).” 39 C.F.R. § 3010.12(b)(7). More
generally, the Postal Service must provide all information the
Service believes “will assist the Commission to issue a timely
determination of whether the planned rate adjustments are
consistent with applicable statutory policies.” Id.
§ 3010.12(b)(12).

    The Commission must then determine whether the Postal
Service’s planned rate adjustments are “consistent with
applicable law,” id. § 3010.11(e), before the adjustments may
take effect. If the Commission finds the rate adjustments are
“inconsistent with applicable law,” the Postal Service must
submit an amended notice explaining how it has modified the
proposal to comply with relevant law. Id. § 3010.11(f). If an
                               13
amended notice is still “found to be inconsistent with
applicable law, the Commission shall explain the basis of its
determination and suggest an appropriate remedy.” Id.
§ 3010.11(j).

     The system regulation therefore makes clear that the
Commission must exercise its rulemaking authority consistent
with applicable law, which at a minimum includes the
requirements of the PAEA and the APA. After receiving the
Postal Service’s notice, the Commission must independently
determine whether a proposed rate adjustment is “consistent
with applicable law.” A proper application of the system
regulation thus requires the Commission to consider the
statutory objectives and factors before issuing a rate adjustment
order.

                               B.

      The public comments about the stamp price hike
highlighted several relevant statutory objectives and factors the
Commission was required to consider under the APA. See
Motor Vehicle Mfrs. Ass’n, 463 U.S. at 43; Home Box Office,
567 F.2d at 35–36. Of course, the Commission should consider
all relevant statutory factors when reviewing the Service’s rate
adjustment notice, not only those factors raised in the public
comments. The Commission, however, must also respond to
significant points raised by the comments, especially when
those comments challenge a fundamental premise underlying a
rate increase. See MCI WorldCom, 209 F.3d at 765. When
evaluating the Postal Service’s proposed stamp price hike, the
Commission failed to address three categories of public
comments that warranted response.

    First, the Commission failed to address public comments
that undermined the Postal Service’s interpretation of
“simplicity of structure,” a PAEA factor. In its notice, the
                                 14
Postal Service claimed that keeping stamp prices divisible by
five promotes “simplicity of structure” by “facilitat[ing]
convenience” and making prices “straightforward” and
“understandable.” J.A. 8–9. In response, the Greeting Card
Association argued that no individual rate change could
achieve “simplicity of structure” “for the entire schedule.” J.A.
114. In his public comment, Carlson similarly argued that no
individual postage rate constitutes a “structure.” J.A. 100–02.
These comments refer to the text of the PAEA, which requires
a particular type of simplicity: “simplicity of structure for the
entire schedule and simple, identifiable relationships between
the rates or fees charged the various classes of mail for postal
services.” 39 U.S.C. § 3622(c)(6). By its plain terms, the statute
refers to the simplicity of the pricing schedule as a whole and
the relationships between different rates charged for different
classes of postal services. It is not a provision about simple
consumer prices, as suggested by the Postal Service.

     Carlson also challenged the Postal Service’s claim of
convenience, noting that most transactions would not involve
the supposed inconvenience of counting pennies because most
customers pay by debit or credit card and buy stamps in
multiples of five. 6 He suggested that customers who buy one
stamp at a time and pay in cash are more likely to have low
incomes and “may not appreciate the supposed ‘convenience’
of a higher price.” J.A. 100. The Greeting Card Association
added that retail customers are accustomed to stamp prices that
frequently are not divisible by five. J.A. 112. Disputing the
Postal Service’s claims, Carlson also argued that the meaning
of fifty-two cents is just as clear and straightforward as the
meaning of fifty-five cents and noted that the public had never
struggled to understand the price of stamps, even though that
price had not been divisible by five for most of the nation’s

   6
       Stamp booklets contain 20 stamps and stamp coils contain 100.
                                15
history. J.A. 97–98. These public comments called into
question the justifications offered by the Postal Service, and
therefore the Commission should have evaluated whether
divisibility by five did, in fact, promote the statutory interest in
“simplicity of structure.” See MCI WorldCom, 209 F.3d at 765.

      Second, the Commission did not address public comments
arguing that the proffered justification for the stamp price hike
misstated the “effect of rate increases upon the general public.”
See 39 U.S.C § 3622(c)(3). The Postal Service claimed that
reduced surcharges for nonstandard first-class mail products
would mitigate the stamp price hike’s impact and suggested
that in the future the Service would continue to raise rates in
five-cent increments so that rates would need to be raised less
frequently. J.A. 8–9. In his public comment, Carlson argued
that rate reductions for nonstandard mail products could not
meaningfully mitigate the effect of the stamp price hike
because the reductions applied to only about three percent of
first-class mail. Carlson also noted that the Postal Service had
not committed to less frequent rate increases and that the five-
cent increment simply meant higher prices. J.A. 103–05. The
Commission’s analysis acknowledged that the Postal Service
had not committed to less frequent rate increases and, in fact,
expressly noted the Postal Service’s “flexibility” to depart from
five-cent increases in future price adjustments. J.A. 208–09.
The Commission did not address Carlson’s other concerns
about the stamp price hike’s effect on the general public, did
not acknowledge that the public effect of the increase was a
statutory factor, and did not explain how this factor fit into the
Commission’s overall assessment of the stamp price hike’s
compliance with the PAEA.

     Third, the Commission failed to address public comments
raising three additional statutory objectives and factors that
weighed against a five-cent increase in the price of stamps. For
                               16
example, the Greeting Card Association provided comments
concerning “the available alternative means of sending and
receiving letters and other mail matter at reasonable costs,” 39
U.S.C. § 3622(c)(4). It argued the Commission should consider
the risk that the stamp price hike would hasten the trend toward
electronic bill payment systems. J.A. 115. The Association for
Postal Commerce argued that increasing stamp prices by large
amounts at infrequent intervals would undermine the statutory
objective of “predictability and stability in rates,” 39 U.S.C.
§ 3622(b)(2). J.A. 89. Carlson argued that an unprecedented
stamp price hike based solely on a frivolous appeal to the
convenience of nickels over pennies was inconsistent with the
statutory objective of maintaining “a just and reasonable
schedule for rates,” 39 U.S.C. § 3622(b)(8). J.A. 104. These
comments merited a response because they challenged the
Commission’s primary rationale by raising substantial
countervailing statutory considerations. See MCI WorldCom,
209 F.3d at 765. Yet the Commission did not evaluate any of
these statutory objectives and factors or explain how they
should be weighed against the “simplicity of structure”
rationale to determine whether the stamp price hike was
consistent with the framework of the PAEA.

     In his appeal, Carlson largely repeats the arguments made
in comments before the Commission. In response, the
Commission maintains it satisfied any obligation to consider
the statutory objectives and factors in its rate-approval order by
focusing on pricing flexibility, which is both an objective and
a factor under the PAEA. See 39 U.S.C. § 3622(b)(4), (c)(7).
Order 4875 noted that “subject to certain limitations, most
prominently the price cap, the PAEA gives the Postal Service
pricing flexibility within First-Class Mail.” Order No. 4875 at
19–20. According to the Commission, the Order’s reference to
the Postal Service’s pricing flexibility constitutes a sufficient
evaluation of the statutory objectives and factors.
                                 17
      We conclude that the Commission fell short of the APA’s
requirement for reasoned decisionmaking because it did not
adequately analyze the stamp price hike’s compliance with all
of the PAEA’s relevant statutory objectives and factors,
particularly those raised in the public comments. 7 See
Newspaper Ass’n, 734 F.3d at 1210; Home Box Office, 567
F.2d at 35–36. The Commission did not address whether the
Postal     Service’s    claims     about    the convenience,
straightforwardness, and understandability of prices divisible
by five had anything to do with the PAEA’s requirement for
“simplicity of structure,” and offered no explanation for why it
could not undertake such an analysis in the time provided for
its review. The Commission also failed to evaluate how other
statutory objectives and factors might bear on the proposed rate
change or outweigh the Postal Service’s reliance on “simplicity
of structure.” Thus, the Commission failed to “demonstrate the
rationality of its decision-making process by responding to
those comments that are relevant and significant.” Grand
Canyon Air Tour Coal. v. FAA, 154 F.3d 455, 468 (D.C. Cir.
1998); see also MCI WorldCom, 209 F.3d at 765 (an agency
must respond to comments “that can be thought to challenge a
fundamental premise”). Because the Commission cannot

    7
       We decline to adopt the Commission’s purported “blatant
disregard” standard as the test for when the Commission must
address statutory factors and objectives during a rulemaking on rates.
This standard arises from the Commission’s post-hoc
characterization of its regulations in an order setting forth the
Commission’s approach to workshare discounts under 39 U.S.C.
§ 3622(e). See Postal Regulatory Comm’n, Order No. 536 at 34
(Sept.           14,           2010),           available           at
https://www.prc.gov/Docs/70/70204/Order_No_536.pdf. It is not
established by law, is not codified in any regulation, has no direct
application to rates other than workshare discounts, lacks definition
(as the Commission conceded during oral argument), and conflicts
with the APA requirements described above.
                               18
determine whether a rate adjustment is “consistent with
applicable law” without weighing the PAEA’s enumerated
factors and objectives, the Commission also failed to comply
with the system regulation in adopting the stamp price hike.

                               C.

     We find unpersuasive the Commission’s arguments that its
limited review of the stamp price hike was justified because the
PAEA requires a quick decisionmaking process that does not
allow sufficient time to evaluate the statutory objectives and
factors. The Commission asserts that the stamp price hike
satisfies the PAEA’s price cap and other quantitative factors,
and therefore is valid even without a fuller consideration of the
PAEA’s “qualitative” objectives and factors. In effect, the
Commission argues that the demands of the PAEA modify the
ordinary requirements of the APA that a decision be
“reasonable and reasonably explained.” Nat’l Tel. Coop. Ass’n,
563 F.3d at 540.

     Yet absent a clear statement, this court will not assume that
a statute modifies the reasoned decisionmaking requirements
of the APA. See 5 U.S.C. § 559 (“[A] [s]ubsequent statute may
not be held to supersede or modify . . . [the APA] . . . except to
the extent that it does so expressly.”); City of New York v.
Permanent Mission of India to United Nations, 618 F.3d 172,
203 (2d Cir. 2010) (“Subsequent organic statutes may
supersede or modify APA requirements, but they must do so
expressly.”); see also Dickinson v. Zurko, 527 U.S. 150, 155
(1999). This comports with “this Court’s duty to interpret
Congress’s statutes as a harmonious whole rather than at war
with one another.” Epic Sys. Corp. v. Lewis, 138 S. Ct. 1612,
1619 (2018). Moreover, the PAEA specifically incorporates
the APA standards of review for Commission actions and
                              19
nothing in the text or structure of the PAEA suggests the
Commission can shortchange the requirements of the APA.

     Since the enactment of the PAEA and in its system
regulation, the Commission has maintained that Congress
intended the Commission’s review of proposed rate changes to
be simple enough to complete in forty-five days. Order No. 43,
72 Fed. Reg. at 63,665. It claims that this timeline comes from
the PAEA, which provides:

   The system for regulating rates and classes for market-
   dominant products shall . . . not later than 45 days before
   the implementation of any adjustment in rates under this
   section, . . .—
       (i)     require the Postal Service to provide public
       notice of the adjustment;
       (ii) provide an opportunity for review by the Postal
       Regulatory Commission;
       (iii) provide for the Postal Regulatory Commission to
       notify the Postal Service of any noncompliance of the
       adjustment with the limitation under subparagraph (A);
       and
       (iv) require the Postal Service to respond to the
       notice provided under clause (iii) and describe the
       actions to be taken to comply with the limitation under
       subparagraph (A).

39 U.S.C. § 3622(d)(1)(C). In its system regulation, the
Commission interprets this provision to mean that “[t]he
inference is strong that Congress contemplated that
complicated or subjective compliance issues would be
addressed during the annual compliance review, or through the
complaint procedures of section 3662.” Order No. 43, 72 Fed.
Reg. at 63,665. The Commission candidly acknowledges that
it prioritizes the speed of the rulemaking process over its
                              20
thoroughness and scope, based on the view that it could “give
close scrutiny to only a limited number of compliance issues in
the time available” under 39 U.S.C. § 3622(d)(1)(C). Id. The
Commission has consistently maintained this interpretation in
subsequent orders as well as in its litigating position here.

     The Commission’s interpretation, however, is contrary to
the plain language of the statute when read as a whole.
“[C]ourts must give effect to the clear meaning of statutes as
written,” Estate of Cowart v. Nicklos Drilling Co., 505 U.S.
469, 476 (1992), which includes “the broader context of the
statute as a whole,” Robinson v. Shell Oil Co., 519 U.S. 337,
341 (1997). Even an agency’s consistent and longstanding
interpretation, if contrary to statute, can be overruled. “A
regulation’s age is no antidote to clear inconsistency with a
statute.” Brown v. Gardner, 513 U.S. 115, 122 (1994); see also
SEC v. Sloan, 436 U.S. 103, 118 (1978) (“Nor does the
existence of a prior administrative practice, even a well-
explained one, relieve us of our responsibility to determine
whether that practice is consistent with the agency’s statutory
authority.”); Se. Ala. Med. Ctr. v. Sebelius, 572 F.3d 912, 920
(D.C. Cir. 2009) (“No matter how consistent its past practice,
an agency must still explain why that practice comports with
the governing statute and reasoned decisionmaking. . . . [N]o
amount of historical consistency can transmute an unreasoned
statutory interpretation into a reasoned one.”); Antonin Scalia,
Judicial Deference to Administrative Interpretations of Law,
1989 Duke L.J. 511, 517 (1989) (“[T]here is no longer any
justification for giving special deference to long-standing and
consistent agency interpretations of law.”).

     The Commission misreads the PAEA, which requires four
actions to be completed “not later than 45 days before the
implementation of any adjustment in rates under this section.”
39 U.S.C. § 3622(d)(1)(C). One of the actions is “review by the
                              21
Postal Regulatory Commission.” Id. § 3622(d)(1)(C)(ii). The
PAEA is silent about the amount of time the Commission may
take during its review. Congress did not limit the scope and
duration of the Commission’s review, but did charge the
Commission with setting rates through rulemaking (rather than
adjudication), with the due consideration required by the APA.

     Moreover, other provisions within the PAEA provide
relevant context, further reinforcing that Congress did not
abbreviate the Commission’s review period. “[I]n expounding
a statute, we must not be guided by a single sentence . . . but
look to the provisions of the whole law.” Del. Dep’t of Nat.
Res. & Envtl. Control v. EPA, 895 F.3d 90, 97 (D.C. Cir. 2018)
(quoting U.S. Nat’l Bank of Or. v. Indep. Ins. Agents of Am.,
Inc., 508 U.S. 439, 455 (1993)). The PAEA establishes a
ninety-day timeline for “expedited” review of rate changes
under “extraordinary or exceptional circumstances.” 39 U.S.C.
§ 3622(d)(1)(E). Providing for an expedited review in
exceptional circumstances that could take up to ninety days
belies the Commission’s claim that the PAEA requires an
ordinary review to be completed in just half that time.
Similarly, reading the PAEA alongside the APA suggests that
if any inference should be drawn from the forty-five day delay
period, it would be that Congress wanted the public to have
more notice before a rate change. The APA requires a
minimum of thirty days between the announcement of a final
rule and its effective date. 5 U.S.C. § 553(d). The PAEA’s
forty-five day minimum is longer than the ordinary delay
period and the statute is silent regarding the amount of time
allocated for the Commission’s consideration of a rate
adjustment.

     As the Commission admitted at oral argument, it is unable
to locate a short review period within the PAEA’s text or
structure. Instead, the Commission leans heavily on legislative
                               22
history and defends its limited and expedited consideration
during the rate approval process with citations to a Senate
Report, as well as to a post-enactment letter signed by two
senators and submitted as part of the public comments on the
proposed system regulation. Yet when the statutory text is
clear, legislative history should not be used to muddy its
meaning. See Ratzlaf v. United States, 510 U.S. 135, 147–48
(1994). And, by definition, post-enactment statements of
members of Congress are not even part of the legislative
history. Bruesewitz v. Wyeth LLC, 562 U.S. 223, 242 (2011)
(“Post-enactment legislative history (a contradiction in terms)
is not a legitimate tool of statutory interpretation.”). The PAEA
is silent about how long the Commission has to approve a
proposed rate adjustment and legislative history cannot provide
the express statement necessary to eliminate the reasoned
decisionmaking required by the APA. See 5 U.S.C. § 559.
Nothing in the PAEA justifies a truncated rulemaking analysis
that fails to meet the requirements of the APA.

     We also reject the Commission’s argument that it can
satisfy the PAEA by deferring consideration of the statutory
factors and objectives until its annual compliance review or in
the adjudication of individual complaints that a specific rate
regulation is inconsistent with the PAEA. Standing alone,
annual reviews and complaint adjudications do not satisfy the
PAEA’s requirement that the Commission create a “modern
system for regulating rates” that is specific to market-dominant
products and reflects the concerns enumerated in 39 U.S.C.
§ 3622(b)–(c). The annual reviews and complaint
adjudications were established by Congress in separate
sections of the PAEA that apply to postage rates generally and
reflect no special consideration for concerns specific to market-
dominant products. See id. §§ 3653(b), 3662(a). Complaints
and annual reviews take place after rulemaking is complete.
Such post-implementation review of rates shifts the burden of
                               23
proof to the public to demonstrate the unreasonableness of rates
that have already been adopted, instead of requiring the
Commission to demonstrate through reasoned rulemaking that
its proposed rates comply with the APA and PAEA. See, e.g.,
Nat’l Lime Ass’n v. EPA, 627 F.2d 416, 433 (D.C. Cir. 1980)
(“[A]n initial burden of promulgating and explaining a non-
arbitrary, non-capricious rule rests with the [a]gency.”).

     In addition, as a practical matter, an invalid rate increase
can result in overpayment to the Postal Service without any
means of recovery. See 39 U.S.C. § 3681 (prohibiting
reimbursement for any amount paid pursuant to a rate later
determined to be unlawful). Moreover, the complaints and
annual reviews have separate dockets, and there is no
mechanism for taking into consideration issues that were raised
in the public comment period but were not addressed by the
Commission during the initial rulemaking.

     The statutory structure confirms the annual review and
separate complaint process cannot provide a post-hoc
rationalization of rate adjustments. “Just as Congress’ choice
of words is presumed to be deliberate, so too are its structural
choices.” Univ. of Tex. Sw. Med. Ctr. v. Nassar, 570 U.S. 338,
353 (2013). The annual review and complaint process exist
apart from the regulatory system for market-dominant products
and cannot satisfy the PAEA framework, the APA’s
requirements for reasoned decisionmaking, or the system
regulation’s requirement that the Commission determine
whether a proposed rate adjustment is “consistent with
applicable law” in the development and issuance of a rate
approval order.

                           *   *    *

     Congress directed the Commission to serve as more than
just a rubber stamp of the Postal Service’s proposed rate
                               24
increases. The PAEA establishes a robust rulemaking process
for the Commission, subjecting rate-change proposals to the
deliberative and participatory process of notice-and-comment
rulemaking under the APA. By failing to consider relevant
statutory objectives and factors and declining to respond to
significant public comments, the Commission violated the
APA when it approved the stamp price hike.

                               III.

     We must next determine whether the stamp price hike can
be severed from the other parts of Order 4875, which includes
a rate adjustment for first-class mail products as well as
adjustments for other mail categories. The APA requires a
reviewing court to “hold unlawful and set aside agency action”
that is arbitrary and capricious. 5 U.S.C. § 706(2). An “agency
action” may be either “the whole or a part of an agency rule
[or] order.” 5 U.S.C. § 551(13) (incorporated by 5 U.S.C.
§ 701(b)(2)). Thus, the APA permits a court to sever a rule by
setting aside only the offending parts of the rule. See, e.g.,
K Mart Corp. v. Cartier, Inc., 486 U.S. 281, 294 (1988);
Virginia v. EPA, 116 F.3d 499, 500–01 (D.C. Cir. 1997). Two
conditions limit the exercise of this power. First, the court must
find that “the agency would have adopted the same disposition
regarding the unchallenged portion [of the regulation] if the
challenged portion were subtracted.” Sierra Club v. FERC, 867
F.3d 1357, 1366 (D.C. Cir. 2017). Second, the parts of the
regulation that remain must be able to “function sensibly
without the stricken provision.” Sorenson Commc’ns. Inc. v.
FCC, 755 F.3d 702, 710 (D.C. Cir. 2014) (quoting MD/DC/DE
Broads. Ass’n v. FCC, 236 F.3d 13, 22 (D.C. Cir. 2001)).

     Carlson requests that the court invalidate the five-cent
stamp price hike. We determine that the category of first-class
rate adjustments, including the stamp price hike, are a single
                              25
agency action that can be severed from the other parts of the
Order. Although only the stamp price hike was at issue in this
case, that increase cannot be separated from the rate adjustment
for the category of first-class mail because the first-class
provisions are “intertwined.” Epsilon Elecs., Inc. v. Dep’t of
Treasury, Office of Foreign Assets Control, 857 F.3d 913, 929
(D.C. Cir. 2017). The PAEA links the prices of all first-class
mail products, including stamps, by applying a rate cap to all
first-class mail rather than to individual products within that
category. See 39 U.S.C. § 3622(d)(2). The ten percent increase
in the first-class letter stamp limited the Commission’s ability
to raise rates for other first-class mail products. In fact, the
Order lowered rates for nonstandard first-class mail products
and still fell barely within the rate cap. The Commission also
approved the changes in rates for first-class mail as a package,
treating them together in Ordering Paragraph One. See North
Carolina v. FERC, 730 F.2d 790, 796 (D.C. Cir. 1984) (noting
agency statement that it approved three agreements as “a
comprehensive settlement which, as a package, appears
reasonable”).

      The first-class mail adjustment, however, has no
connection with the Order’s other categories, which are
concerned primarily with rate changes for marketing mail,
periodicals, package services, overweight item charges, and
special services. These rates are not interconnected by statute
and the Commission analyzed them independently in separate
ordering paragraphs. We see no reason why these other rates
cannot “function sensibly” without the first-class mail
category. MD/DC/DE Broads. Ass’n, 236 F.3d at 22. Because
both requirements for severability are satisfied, we vacate the
first-class rate adjustments and leave the remainder of Order
4875 in place.
                                26
                                IV.

     Although the five-cent stamp price hike may have gone
unnoticed by many, the American Revolution was fomented in
part by ordinary people who objected to taxation through
stamps. 8 Carlson’s objections arise in less fraught times. We
conclude that this stamp price hike violated the APA because
the Commission failed to consider the relevant policies of the
PAEA, particularly those raised in the public comments. We
therefore grant Carlson’s petition for review, vacating the part
of Order 4875 that includes the stamp price hike and the rate
adjustments to the category of first-class mail.

                                                       So ordered.

8
  See, e.g., Justin DuRivage & Claire Priest, The Stamp Act and the
Political Origins of American Legal and Economic Institutions, 88
S. Cal. L. Rev. 875, 875 (2015) (“The British Parliament’s enactment
of the Stamp Act of 1765 is widely acknowledged as a starting point
for the acceleration of tensions that led to the Declaration of
Independence in 1776.”) (citing Edmund S. Morgan, The Birth of the
Republic, 1763-89, at 18–28 (3d ed. 1992); Gordan S. Wood, The
American Revolution 29–37 (2003)).
                              27
                         APPENDIX

Title 39 U.S.C. § 3622(b) provides:

“[The Commission’s system for regulating rates and classes]
shall be designed to achieve the following objectives, each of
which shall be applied in conjunction with the others:

        (1) To maximize incentives to reduce costs and
            increase efficiency.
        (2) To create predictability and stability in rates.
        (3) To maintain high quality service standards
            established under section 3691.
        (4) To allow the Postal Service pricing flexibility.
        (5) To assure adequate revenues, including retained
            earnings, to maintain financial stability.
        (6) To reduce the administrative burden and increase
            the transparency of the ratemaking process.
        (7) To enhance mail security and deter terrorism.
        (8) To establish and maintain a just and reasonable
            schedule for rates and classifications, however
            the objective under this paragraph shall not be
            construed to prohibit the Postal Service from
            making changes of unequal magnitude within,
            between, or among classes of mail.
        (9) To allocate the total institutional costs of the
            Postal Service appropriately between market-
            dominant and competitive products.”
                              28
Title 39 U.S.C. § 3622(c) provides:

“In establishing or revising such system, the Postal Regulatory
Commission shall take into account:

        (1) the value of the mail service actually provided
            each class or type of mail service to both the
            sender and the recipient, including but not limited
            to the collection, mode of transportation, and
            priority of delivery;
        (2) the requirement that each class of mail or type of
            mail service bear the direct and indirect postal
            costs attributable to each class or type of mail
            service through reliably identified causal
            relationships plus that portion of all other costs of
            the Postal Service reasonably assignable to such
            class or type;
        (3) the effect of rate increases upon the general
            public, business mail users, and enterprises in the
            private sector of the economy engaged in the
            delivery of mail matter other than letters;
        (4) the available alternative means of sending and
            receiving letters and other mail matter at
            reasonable costs;
        (5) the degree of preparation of mail for delivery into
            the postal system performed by the mailer and its
            effect upon reducing costs to the Postal Service;
        (6) simplicity of structure for the entire schedule and
            simple, identifiable relationships between the
            rates or fees charged the various classes of mail
            for postal services;
                      29
(7) the importance of pricing flexibility to encourage
    increased mail volume and operational
    efficiency;
(8) the relative value to the people of the kinds of
    mail matter entered into the postal system and the
    desirability and justification for special
    classifications and services of mail;
(9) the importance of providing classifications with
    extremely high degrees of reliability and speed of
    delivery and of providing those that do not
    require high degrees of reliability and speed of
    delivery;
(10) the desirability of special classifications for both
     postal users and the Postal Service in accordance
     with the policies of this title, including
     agreements between the Postal Service and postal
     users, when available on public and reasonable
     terms to similarly situated mailers, that—
       (A) either—
                 (i) improve the net financial
                     position of the Postal Service
                     through reducing Postal Service
                     costs or increasing the overall
                     contribution to the institutional
                     costs of the Postal Service; or
                 (ii) enhance the performance of mail
                      preparation,        processing,
                      transportation,    or     other
                      functions; and
       (B) do not cause unreasonable harm to the
           marketplace.
                      30
(11) the educational, cultural, scientific, and
     informational value to the recipient of mail
     matter;
(12) the need for the Postal Service to increase its
     efficiency and reduce its costs, including
     infrastructure costs, to help maintain high quality,
     affordable postal services;
(13) the value to the Postal Service and postal users of
     promoting intelligent mail and of secure, sender-
     identified mail; and
(14) the policies of this title as well as such other
     factors as the Commission determines
     appropriate.”