Dan, I believe you are mixing up non-machineable surcharge and balloon rate. The balloon rate does apply on priority mail. Here is the wording from the USPS website:
"Priority Mail Rates
Parcels that weigh less than 15 pounds but measure more than 84 inches in combined length and girth are charged the applicable rate for a 15-pound parcel."
P.S. You can mail a parcel larger than 108" length plus girth, there is just an oversize surcharge that applies. In fact, you can mail up to 130" length plus girth. Anything larger than that is not mailable, as well as anything that exceeds 70 pounds regardless of size.