Panel Recommends 2-Cent Postal Rate Hike

Postal Service Wanted 3-Cent Rise; Actual Increase Expected In May

(CBS/AP)  Postal rates are a step closer to going up, but not as much as the Postal Service had wanted.

The Postal Service asked to raise the cost of mailing a basic letter by 3 cents, to 42 cents, and to establish a "Forever" stamp, largely because of higher fuel costs.

What it got in a recommendation by the Postal Regulatory Commission was only 2 cents more for letters and postcards, for a 41-cent first-class rate.

However, each additional ounce would cost 17 cents under the proposal, down 7 cents, a boon for those mailing documents, tax returns and wedding invitations. Currently, a two-ounce envelope costs 63 cents to mail; if this proposal is adopted, it would cost 58 cents.

The PRC took ten months to reach its conclusions, but they're only recommendations. The panel doesn't always agree with the Postal Service, which can accept the findings, or, by a unanimous vote of its Board of Governors, reject them or modify them, reports CBSNews.com's Lloyd de Vries.

The governors won't make a decision until at least March 8, a USPS spokesman told de Vries. It's expected new rates will go into effect in mid-May.

The Forever stamp, or stamps, would be sold at the current rate, whatever it is, and good for mailing a letter even if rates subsequently go up.

"If you buy it today, or whenever you buy it, it will always be good for mailing a single letter at the one-ounce rate," David E. Failor, executive director of Stamp Services of the USPS, said.

Other countries already have these "Forever" stamps, and the PRC has wanted one in the U.S., too, to cut down on the confusion when postal rates change, reports de Vries. The USPS went along with the request, in the hopes of expediting the panel's findings.

Postal officials and mailers have been expecting a rate increase in mid-May. In fact, most of this year's new postage stamps have been pushed off until after that date. Only stamps with a definite date tie-in (Ella Fitzgerald for Black History Month, Love and Kisses for Valentine's Day) and two others will be issued before then. (The Oklahoma centennial commission requested that the statehood stamp be issued early in the year, and the Henry Wadsworth Longfellow stamp will be issued at a stamp collecting show the USPS co-sponsors.)

No design or theme has been announced for the Forever stamp. While the Postal Service might lose money on customers who stock up on the issue and hold it past subsequent rate changes, it will make money on stamps purchased but not immediately used, as well as not having to issue as many rate-change stamps.

The U.S. already has something of a "forever" stamp: the Breast Cancer Research charity stamp, reports de Vries.

Issued in 1998 for a two-year period, part of the price of this stamp goes to charity. It's already raised more than $53 million, and outlasted all other charity stamps. Every time the stamp is due to expire, Sen. Diane Feinstein (D-Calif.) moves to extend it.

Right now, it costs 45 cents, or 6 cents more than the current first-class letter rate. When postal rates go up later this year, as is expected, the Breast Cancer Research stamp will go up another dime, to 55 cents.

If it was purchased at a cheaper price, customers are supposed to pay the difference when they use it to mail a letter. But there's really no way to know what was paid.

Other highlights from the proposal (.pdf) include:

• Express Mail, flat rate up from $14.40 to $16.25.
  
  
• Three-ounce barcoded bank statement, down from 73.9 cents to 58.4 cents
  
  
• Bulk-mailed weekly newsmagazine, up from 18.5 cents to 20.6 cents.
  
  
• Household magazine, up from 28.9 cents to 33.6 cents.
  
  
• Postcard, up from 24 cents to 26 cents.

The cost of a first-class stamp went from 37 cents to 39 cents in January 2006, because Congress had required the USPS to help fund federal pensions. Before that, the price had been unchanged since 2002.

[thenamesdave]

Just let me keep using the first-class stamps I still have on hand.

[bildooreilly]

Service has been horrible ever since the beginning of the year, and now you want to charge me more for it?

[inventagod]

Just double the cost of mailing catalogs and leave the letter writers alone!

[afmca]

This will just force me into paying all my bills electronically and communicating by e-mail or phone. I will also accept receiving my bills electronically. Basically as the Postal Service keeps raising rates they are destroying their base. I agree, let all the junk mail and catalogues cover the entire cost of the increase. I get so much junk e-mail from credit card companies, phony mortgage companies, and worthless advertisements .. personal first class mail shouldn't subsidize corporate mailings! But, of course, under Republican rule the people always subsidize American business.

[rharrin1]

Everyday people that drive back and forth to work don't get a raise when the price of fuel goes up.

They have to learn how to run it more efficiently.

[bildooreilly]

Gee at the rate they've been raising prices it's gonna cost $2 to mail a freakin letter in 3 years.

[jonw1115]

Who writes letters anymore. My 67 old dad knows how to use the internet and send emails. It is pretty much common sense that the reason for price increase is because of the drop in use of the postal service. Their operational costs are skyrocketing and they have less of a base to pay for it. Even large retailers have moved to electronic ordering. Personally, I went from mailing bills 5 or more years ago to paying almost everything electronically today. We are all witnessing the death of a dinasour!

[gwagener]

I'm glad to see the forever stamp finally coming to the US. I rarely mail anything anymore with electronic bill pay and e-mail, so I always end up with left over stamps when the rates change.
The postal rates in Europe are a lot higher than in the US, but there, the customers get next day delivery. Their contries are musch smaller than the US of course.
Postal rates are only as high as they are because we have delivery to all the remote areas all over this huge country.

[michellem99-2009]

I can't believe that the post office wants to keeps jacking up the prices of every thing just because of fuel. I don't care for cars as I walk or take the bus. It looks we all pay one way or another. I write very few letters,but I will still use snail mail. My parents don't use computers as they don't care/understand them. I use the computer as I like read the news on-line. I have to read large print. I feel the smamps are getting to high. Bills have to be paid. I don't trust on line bill pay. I am from the old school as the say goes.

[willyn3]

It's time to start thinking about eliminating the USPS. Next time you pick up your mail check how much is necessary. My guess is about 1% by weight, 10% by pieces. All your bills can be paid electronically. Who needs them?

Next on my list of cost savings will be the US Navy, virtually useless except to "show the flag" and try and intimidate other countries. We need a modern air force and a few highly skilled ground forces, that's all!

[sharncedar]

what is amazing is what an orderly, effective, and inexpensive service the USPS is. if this was a set of competing sleazeball corporations, like our cell phone service, the prices would be 5 times higher if not more and the coverage incomplete, and the customer service combative when not downright fraudulent.

It gives the lie to the "capitalism extremists" who say that private business always gives better service and better prices than government or regulated industries. there are many other examples, for example deregulated energy companies in our area is more expensive and worse service.

it seems like we've reached the point in history where its time to start nationalizing and regulating industries again, it leads to better prices and more consistent service, at least if the USPS is a good example.

I mean, e=imagine some sleazy outfit like GE trying to provide first class mail service to every home in America for 30 cents a letter, its unthinkable. their greed and propensity to hasty management decisions makes private businesses in many cases more wasteful and far less efficient than government business.

[hollyt2-2009]

hey willy3 you almost had me on your side. I agree with electronically paying for things. But then you had to make it political. thanks. now im in "inventagod's" corner. He stayed with the topic. You go!!!

[sclaires]

Oh, I know the reason they want to raise the rates and that is so that they can continue to pay huge bonuses to management. Why should management, who are nothing but postal employees, in the first place, but have managed to get promoted, receive bonuses?? Have already heard about the bonuses from someone who is now retired from the USPS.

[nothappyatall]

"All your bills can be paid electronically. Who needs them? WillyNJ"

Not quite, many businesses do not have electronic payments, Mid American energy does, Iowatelecom does not so that means mailing a check for the phone.
A browse thru mycheckfree.com list of businesses will show a long list of companies and utilities who accept payment electronically thru them at no charge to us.

Far as I'm concerned they can pretty much close the Post Office down, why would anyone spend paper, envelope and postage to mail a letter when email is free and is instant??

[costanoan]

You might want to rethink that doing away with the USPS idea. I can't think of an alternative for transmitting notarized documents (although there may be some states not requiring a raised seal -- mine does). There's the issue of greeting cards. Are you [theoretically] going to send your sweet, old grandmother an e-card ('when you care to send the very least')? I wouldn't want to have to FedEx a card to mine, at approx. $20 a pop. Not everyone has a computer; not everyone is capable of navigating the internet. If your banker or lawyer have to go that route to get legal documents to you, the price of their services goes up. Hmm - I wonder how many folks the USPS employs. I don't wonder enough to look it up, mind you, but consider the surge in the unemployment rate that would come with closing the USPS down. Sometimes we gotta think things through.

[rhs648]

Let's put things in perspective. People who have broadband internet probably pay between $30 to $60 per month. Now you pay 10 bills on the internet. Compare that to paying $3.90 to pay 10 bills through the mail. Suddenly, postage seems cheap. Of course, you can do other things on the internet besides paying bills.