Mailing a Letter to Cost a Penny More Next Year

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Cost of mailing a letter to rise in JanuaryWASHINGTON (AP) - It'll cost a penny more to mail a letter next year.

The cash-strapped U.S. Postal Service announced Tuesday that it will increase postage rates on Jan. 22, including a 1-cent increase in the cost of first-class mail, to 45 cents.

Under the law the post office cannot raise prices more than the rate of inflation, which is 2.1 percent, unless it gets special permission from the independent Postal Regulatory Commission. The PRC last year turned down such a request.

The post office lost $8 billion in fiscal 2010 and the bottom line is likely to be even worse when final figures for fiscal 2011 are released next month.

The rate increase will make only a small dent in those losses, caused by the recession, movement of mail to the Internet, and a requirement that the agency fund future retiree medical benefits years in advance.

Other proposals to cut the losses have included reduction of mail delivery from six to five days a week and closing thousands of offices across the country.

The current 44-cent rate has been in effect since May 2009.

"The overall average price increase is small and is needed to help address our current financial crisis," Postmaster General Patrick Donahoe said in a statement. "We continue to take actions within our control to increase revenue in other ways and to aggressively cut costs. To return to sound financial footing we urgently need enactment of comprehensive, long-term legislation to provide the Postal Service with a more flexible business model."

The Postal Regulatory Commission now has 45 days to verify that the new prices comply with the law limiting the increase to an average of 2.1 percent across all types of mail. They can then take effect.

Because most stamps being issued are "Forever" stamps, they will remain good for first-class postage. But buying new Forever stamps will cost more when the prices go up.

While the price for the first ounce of a first-class letter will rise to 45 cents, the cost for each additional ounce will remain at the current 20 cents.

Other prices will also change including:

-Postcards will go up 3 cents to 32 cents.

-Letters to Canada and Mexico will increase a nickel to 85 cents.

-Letters to other foreign countries will go up 7 cents to $1.05.

-Prices for advertising mail, periodicals and parcels also will rise about 2.1 percent.

-There will be a new three-month option for renting post office boxes, for people who need them only for a short time.

-Delivery confirmation will be free on some parcel services, rather than being an extra charge.

A major financial problem for the post office has been the requirement, imposed in 2006, that it pay $5.5 billion annually into a fund designed to cover the medical benefits for retired employees in the future. No other agency has such a requirement.

But while the post office is not part of the federal budget, the fund receiving the payment is, so it counts as income to the government, making the federal deficit appear $5.5 billion smaller. Because eliminating the payment would make the deficit seem bigger, there has been reluctance to drop it.

Still, both houses of Congress are working on legislation to try and address the post office's financial problems, though some members are also fighting the closing of local offices and seeking ways to keep six-day delivery.

A bill by Reps. Darrell Issa, R-Calif., and Dennis Ross, R-Fla., waiting action in the House would allow the post office to go to five-day mail delivery, phase out lower rates for nonprofit groups, require most mail to be delivered to cluster boxes rather than door-to-door, and increase the amount postal workers pay for health insurance. It would also set up a system for closing post offices similar to the one for closing military bases, bar no-layoff clauses in contracts and, under some circumstances, call for an emergency board to take over postal management.

Bills by Sens. Tom Carper, D-Del., and Susan Collins, R-Maine, are moving through committees in the Senate.

Meanwhile, the post office's largest union, the National Association of Letter Carriers, has hired its own consultants to study postal operations and make recommendations for the long-term future of the agency.


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Harry Piels

Wow, what happened that stamps need to go up every other year? In the history of the country up until the 1950s, the postage for a letter was only .05. It remained there it seems for a decade or more. On a relative basis, I bet the mail people made as much or more than they do now. Probably the gas increases since the 70s along with the computer email, along with an increase in the number of post offices with population growth did them in big time. My formula for recovery is 1. the electric postal truck 2. charge more for JUNK MAIL 3. close down post offices that are less than tfive miles from another one, and eliminate postmasters for every mail center. They could make do with small, less expensive outposts .

October 19 2011 at 5:41 PM Report abuse rate up rate down Reply
Billy

Postal Service doesn,t lose the money, the freaking retards in Washington DC keeps taking their money to pay on their BS. Thats a fact folks. They can run a Postal company how do you think they can even run a health care system. They can,t, can,t wait for 2012, we get our country back

October 19 2011 at 5:08 PM Report abuse rate up rate down Reply
Brian Workman

Why not make it an even $0.50 per ounce & come back 5 or 10 years later!?!?!?

October 19 2011 at 4:55 PM Report abuse -1 rate up rate down Reply
Richard

Please keep house deliveries to just THREE days a week. In this day of electronics If you need more then THREE days of delivery then get a PO box. 99% of all mail is JUNK and goes right to the trash bin.

October 19 2011 at 4:40 PM Report abuse -1 rate up rate down Reply
thagrus

Talk about pricing yourself out of business lol. If they would stop buying employees homes when they get transfered that might help

October 19 2011 at 4:37 PM Report abuse -1 rate up rate down Reply
alpentino

For many years now, I have been a loyal paytron of the Postal Service. Now, I have come to believe that it is only a matter of time before the U.S. Postal Service eventually disappears. I do not believe that rates must continually increase to offset the year-to-year losses that the Postal Service sustains. Over the years, customers have been forced to pay more for postage because of the never-ending rate hikes for stamps. Don't use the excuse that other countries may be charging even higher rates. I'm not buying this as an explanation. Personally, I am fed up with the higher cost of postage, therefore, I refrain from buying stamps if at all possible. I'm no time and motion expert, nor do I know if the Postal Service operates with upmost efficiency in its attempt to keep up with modern day practices. With that said, I still wonder if, and why, the Postal Service couldn't adopt a more computerize way of accommodating its customers and reduce its reliance on paper based techniques.

October 19 2011 at 4:22 PM Report abuse rate up rate down Reply
1 reply to alpentino's comment
Scottilla

So go mail your letter at Fedex. See how efficient private enterprise is.

October 19 2011 at 4:46 PM Report abuse rate up rate down Reply
CAMERON

ANOTHER WAY TO SAVE HAVE POSTWORKERS WALK MY CITY THE POST OFFICE IS 1 BLOCK TO TOWN. HAVE TWO WALK TWOSIDES BAD WEATHER YES THE TRUCK IS A MUST BUT IT WOULD SAVE. MY APT IS RIGHT IN BACK OF THE POST OFFICE SO ARE MANY STORE THE POSTWORKER GOES TO. THAT WOULD SAVE CUT THE JUNK MAIL RAISE THE PRICE FOR THE JUNK MAIL IT IS THE BIGGEST WASTE. ALSO STOP THE SATURDAY MAIL YOU CAN HAVE THE POSTOFFICE OPEN TO MAIL PACKAGES FOR LITIMED HRS. MAYBE 8AM -1PM BUT EVEN NOW YOU BUY STAMPS BY MAIL.

October 19 2011 at 4:21 PM Report abuse rate up rate down Reply
mpusairsret

I would be willing to pay $.50 for a first class stamp, if all that junk mail was charged the same rate. I sort my mail before I get to the house and just dump the junk in the recycle before going into the house. A friend of mine lives in the city and has mail delivered to the door. He saves steps by placing the recycle bin under the mail slot.

October 19 2011 at 4:21 PM Report abuse rate up rate down Reply
mebecarl

I find it strange that the USPS and Congress doesn't understand that the postal system has steadily failed because we give reduced rates to large companies and corporations. These people (like Pfizer) have BILLIONS in profits from gouging consumers and showing drug commercials every ten minutes on TV. So they have no one to blame but themselves, along with the idiots in Congress who allow the increases.

October 19 2011 at 4:18 PM Report abuse rate up rate down Reply
CAMERON

WHY NOT JUST STOP SATURDAY MAIL THE MORE THE STAMPS GO UP THE MORE MOST WILL PAY ON LINE BILLS TO SAVE A STAMP. THE JUNK MAIL NEAVER ENDS TALK ABOUT A WASTE OF PAPER AND POSTAGE JUST TO BE TOSSED IN THE TRASH.

October 19 2011 at 4:12 PM Report abuse rate up rate down Reply