USPS Board Accepts PRC Decision; Postage Hike Takes Effect Jan. 8
USPS Board Accepts PRC Decision; Rate Hike Takes Effect Jan. 8
Nov. 15, 2005
The U.S. Postal Service Board of Governors voted yesterday to accept the Postal Rate Commission's recommendations to increase most postal rates and fees 5.4 percent. The new rates take effect Jan. 8.
This rate increase, the first since 2002, is needed to fulfill the requirement of a federal law enacted in 2003 requiring the postal service to establish a $3.1 billion escrow account. Without this federal mandate, a rate increase in 2006 would have been unnecessary, the USPS has said.
Among the rate adjustments, the single-piece rate for First-Class mail will rise from 37 cents to 39 cents and the postcard rate will increase 1 cent to 24 cents.
"The governors take this action mindful of our obligation to assure the financial integrity of the nation's postal system," board chairman Jim Miller said in a statement. "These increases will allow the postal service to meet the obligation established by Congress to place funds in escrow in 2006."
The governors voted by fax yesterday to approve the rates. They still are scheduled to have a closed meeting tomorrow to discuss other postal matters.
Though the PRC recommendation called for a rate and fee increase around 5.4 percent for nearly all mail classes and subclasses, different rate changes were necessary in some areas to comply with statutory requirements. For example:
* Rates for small local newspapers will decrease 2.3 percent.
* Rates for solicitations from nonprofit organizations also vary. Generally, Nonprofit Standard Mail will rise 3 percent while Nonprofit Enhanced Carrier Route mail will increase 12.3 percent. In all, nonprofits will pay $17 million less than requested by the postal service.
* The book rate will increase 12.7 percent. By law, all classes of mail must cover their direct cost of service, and books, CDs and library materials would otherwise violate this requirement.
In general, regular Standard mail will increase 5.4 percent and Enhanced Carrier Route Standard mail will rise 5.5 percent. Priority Mail will increase 5.4 percent, Express Mail 5.5 percent, Outside County Periodicals 5.5 percent, Parcel Post 7.1 percent and Bound Printed Matter 5.5 percent.