U.S. Postal Service seeks 8.5% increase in postage rates

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Washington, D.C.—On the heels of the 5.4% rate increase that went into effect in January, the U.S. Postal Service Wednesday filed a request to further raise postage rates an average of 8.5%. The request includes a three-cent increase in the price of a first-class stamp.

The USPS also said it intends to move to an annual cycle for rate adjustments. There is currently no set timetable for rate increase requests. The USPS attributed the rate hike request to rising fuel and health care costs.

Industry response to the filing, which had been expected, was swift.

“Postal rate increases are never good news for organizations that rely on the mail to get their messages and packages out, and this latest increase would mean millions of extra dollars in costs for commercial mailers and nonprofit organizations,” said Jerry Cerasale, senior VP-government affairs at the Direct Marketing Association, in a statement. He said the increase “highlights the desperate need for postal reform.”

American Business Media's reaction echoed that sentiment.

"Today's announcement by the United States Postal Service of yet another increase in postage rates, and the prediction of further increases beyond that, illustrates the need to enact postal reform legislation currently pending in the United States Congress," said ABM President-CEO Gordon Hughes in a statement. 

"This legislation has passed both chambers of Congress by huge margins, and the steps necessary to get the bill to the President's desk for signature must be completed without delay."

 The ABM said additional increases could drive small volume periodical publishers out of the mailstream and send the USPS into a spiral of rising costs and falling volumes.

The USPS stressed in its announcement that it plans to give business mailers incentives to create more efficient mail pieces, based on weight and shape.

“The devil could be in the details, with substantially higher rates for some categories of mail,” Cerasale said. For example, the USPS is seeking a 90% increase in the price to mail a two-ounce first-class parcel.”

—Carol Krol

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