The United States Postal Board of Governors has accepted the rate increase recommended by the Postal Rate Commission and set the effective date of the increase for June 30.
The average rate increase will be 7.7 percent, which is the same as the average increase for First Class mail overall. The price of a first class stamp will increase from 34 cents to 37 cents, which equates to a 8.8 percent increase.
According to postal authorities, First Class mail makes up the majority of the United Postal Service's volume and covers most of the overhead costs of operating the system.
Other rates will also increase-some more than others. For example, Priority mail rates will increase by 13.5 percent, and Express mail rates will increase by 9.5 percent.
Parcel rates will increase by an average of 6.4 percent, and there will be some changes in the parcel rate structure. Bound matter rates will increase an average of nine percent. A number of bulk mailing discounts will be available for mailing various types of parcels.
Rates for Registered mail and Special Handling will also increase under the new rate schedule.
Standard Mail Enhanced Carrier Route (ECR) rates, the mail class often used to mail periodicals such as newspapers, will increase by an average of 6.2 percent. Other periodical mailing rates will increase by an average of 7.7 percent.
The rates for newspapers delivered outside the county of publication will increase by an average of 10.3 percent, and "small newspaper" rate for mailing in county will increase an average of 1.7 percent.
Postal officials blame the need for the rate increase on increases in normal operating costs, such as higher fuel prices and the significantly higher cost of health benefits for its employees. In addition, they say the adding of approximately 1.6 million more deliveries each year also contributes to the need for the increase.
The Postal Service does not unilaterally set its rates. The Postal Reorganization Act of 1970 shifted rate-making authority from Congress to two presidentially appointed bodies-the Postal Board of Governors and Postal Rate Commission.
When the Postal Service determines that its revenue needs require raising rates, it requests a recommend decision from the independent Postal Rate Commission. The commission then holds public hearings to give interested parties the opportunity to have input in the rate process.
The commission has 10 months to conduct in-depth hearings on the request before it makes a recommended decision back to the Board of Governors.
The Governors then may act on the decision as recommended or, in some circumstances, modify the recommendation to reflect appropriate revenue requirements.
Unlike most other government agencies, the Postal Service gets no tax support and must operate on the revenues generated by its services.