Posted on 05/03/2006 8:10:38 AM PDT by Extremely Extreme Extremist
WASHINGTON - The Postal Service said Wednesday it wants to raise the price of a first-class stamp by 3 cents — to 42 cents — and proposed a "forever" stamp that people could use as hedge against future rate increases.
The changes would take effect in the spring of 2007 if approved by the independent Postal Rate Commission.
"A forever stamp would help ease the transition to any future price adjustments," board Chairman James C. Miller III said.
Postmaster General John E. Potter said the agency would not be making a rate change if it were not necessary.
"The Postal Service is not immune to the cost pressures affecting every household and business in America," he said.
For example, each penny increase in the price of a gallon of gasoline costs the post office $8 million, and payroll, health expenses and other costs also have been rising.
And, unlike private delivery companies, the post office cannot simply add a fuel surcharge to its rates.
In addition to the increase in first-class prices, the package of rate changes includes boosts in other categories — and even some rate cuts.
For example, while the first ounce of a letter would rise 3 cents to 42 cents, additional ounces would cost 20 cents instead of the current 24 cents. That means a saving on heavier items such as wedding invitations. The cost to mail a 2-ounce letter would drop from 63 cents to 62 cents.
Other changes would include Express Mail, flat rate up from $14.40 to $16.25; 2-ounce barcoded bank statement, down from 54.5 cents to 48.6 cents; bulk-mailed weekly newsmagazine, up from 17.9 cents to 20 cents; presorted catalog, up from 32.1 cents to 33.6 cents; post card, up from 24 cents to 27 cents.
The forever stamp would help soften the blow of a rate increase by allowing customers to stock up. As originally proposed it would sell for the first class rate and, once purchased, the special stamp would remain valid for whatever the first-class rate is when it is used, regardless of future increases.
Once the post office proposes a rate change, including the new stamp, the matter goes to the Postal Rate Commission, which holds hearings and has 10 months to consider the matter before responding.
The earliest a change would take effect would be May 2007.
The cost of a first-class stamp went from 37 cents to 39 cents in January. Before that, the price had been unchanged since 2002.
The proposed increase would boost the price of mailing a letter to 42 cents.
The increase in January was required so the post office could place some $3 billion in an escrow account, a step required in law.
The House and Senate have both passed bills to eliminate that requirement and efforts are under way to resolve differences between the two versions, but it also faces the threat of a presidential veto.
Since that increase went into the escrow account, the Postal Service still must cover rising costs of fuel, salaries, equipment and other expenses.
In addition to its own fuel expenses, the post office has about 70,000 employees who use their own vehicles and are reimbursed for fuel costs, and there are some 17,000 contractors whose rates are adjusted for rising fuel costs.
Overall, the Postal Service expects to finish this fiscal year about $2 billion in the red.
While a 3-cent increase in first-class stamps would be the most visible change, rates will change for other types of mail also.
For example, it currently costs 63 cents to mail a two-ounce first-class item whether it's a letter, large flat envelope or package. But the post office makes more than 30 cents on the letter, 10 cents on the flat and loses money on the package.
That means the agency will be looking at shape as well as weight in setting new rates, officials have said, particularly in the face of a decline in first-class mail as more people pay bills and send messages via the Internet.
Congress mandated the escrow requirement in 2003 when it passed a law reducing the amount of money the agency has to pay into its retirement system, which auditors said was being overfunded. Instead, Congress ordered the money to be used to reduce debt and, when that was done, to be put into the escrow fund.
The White House has opposed the release of the money from the fund because placing it there counts as income for the federal government and releasing it would have the effect of raising the deficit.
Holy smokes! Again!
Net thing you know they'll get Congress to pass a law to allow them to tax EMAIL's!!!!
;^)
That's the part I never understood. What, do you slide dollar bills into the floppy drive opening? What about the coins?
Remember that stamp cost is an *average*. Costs the same whether you're mailing a birthday card across town, or across the country to the backwoods of Idaho.
Greedy buggers, aren't they?
Also, that would be a specific, individual gallon of gas. Can't get my gas mixed up with my neighbor's.
I'm not the USPS' biggest fan, but I still think that what they pull off on a daily basis is pretty amazing.
I've been paying bills online for about 3 years. It's great.
Now, I only send out 1 actual payment per year -- county taxes. I mail it with a check because they charge a $3.50 processing fee for online credit card payments. Its the principle.
We could get back to 15 cent stamps if we replaced postal workers with illegal aliens.
'Course we may never see our English addressed mail again, either.
The postal service STINKS!!!!
I subscribed to a sports teams newspaper that highlights the prior weeks game and previews the coming game. It was sent first class mail every week(on tuesdays), with TIME SENSITIVE MATERIAL below the post marks.
I NEVER RECIEVED THE PAPER ON TIME. NOT ONCE!!!!
IT ALWAYS SHOWED UP THE FOLLOWING MONDAY OR TUESDAY.
I called to complain and the next weeks issue showed up on the following FRIDAY!!!!!
The postal service SUCKS!!!!!!
I have recieved monthly magazines, sent the first week of the month, in the last week of that month.
The things I WANT are always late, yet I get junk mail everyday.
THE POSTAL SERVICE SUCKS!!!!!
I mail a lot of packages during a year, and you can not beat the USPS. Priority and first class mail is far superior to UPS, fedex, and DHL.
Don't give them any ideas. That has been considered. Tax the Internet! Aren't some ISPs starting to charge for commercial emails? The govt. will get get into it soon enough. Remember they had the bright idea to pay farmers for NOT growing some crops. Take it a step further and charge folks for NOT using the Postal Service.
"More people will switch to online bill pay."
USPS makes their money from bulk rate mail. Your bills and other 1st Class mail items are a nuisance.
That's about as long as I have been paying bills online. It's convenient and I love computers anyway. And boy, do I hate making out a check for my Avon orders now. LOL!
And amtrak
"3 years".....you guys are amateurs......I've been paying bills online for about 16 years.....it is GREAT! (The company that developed the online bill pay software/system was in my city....and I worked in hi-tech at the time)
If I ship something across the country---even a small package, it's already over $6.00.
"What would happen to the price of sending a first class letter if UPS/FEDEX/DHL/ETC where allowed to compete with the USPS?"
This argument comes up on FR at least once a month. The USPS HAS to deliver mail to even the most remote shanty in upper Alaska to an isolated house on the top of a hill in the middle of Nowhere, USA.
UPS/FEDEX/DHL/ETC cherry pick the most profitable routes. Hand it over to them and you cut out a good-sized number of people who would cost them too much to deliver to.
And people would still bitch.
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