Stock up on those forever stamps now because the price of a first class stamp is going up from 46 cents to 49 cents.
The United States Postal Service announced several proposed price changes , effective Jan. 26, 2014. Along with the three cent increase on letters weighing an ounce or less, letters weighing more than one ounce will cost you 21 cents more, letters to all international destinations will run you $1.15 and sending a postcard now costs 34 cents. The USPS says the hikes will generate $2 billion for the financially strapped federal agency.
“It’s no secret that the U.S. Postal Service continues to face serious financial challenges and is looking for ways to improve its dire fiscal situation,” Homeland Security and Governmental Affairs Chairman Tom Carper, D-Del, said of the first class stamp’s 5.9 percent increase. “While I understand the Board of Governors’ desire to take whatever steps that it can do on its own to keep the lights on at the Postal Service, I believe the best way to help the Postal Service gain a sustainable financial footing is through comprehensive postal reform legislation.”
Typically stamp prices have stayed consistent with the average annual rate of inflation of 4.2 percent since the Postal Service was formed in 1971, however, in a letter sent to customers today, Board of Governors Chairman Mickey Barnett described the agency’s “precarious financial condition” and the “uncertain path toward enactment of postal reform legislation” as major factors behind the significant spike in prices.
“Of the options currently available to the Postal Service to align costs and revenues, increasing postage prices is a last resort that reflects extreme financial challenges,” Barnett wrote in the letter. “However, if these financial challenges were alleviated by the timely enactment of laws that close a $20 billion budget gap, the Postal Service would reconsider its pricing strategy.”
Just before the August recess, Chairman Carper and Ranking Member Tom Coburn (R-Okla.) introduced the bipartisan Postal Reform Act of 2013. Sen. Carper, who chaired the subcommittee overseeing the Postal Service, spoke to First about the measure on Aug. 23.
“The idea behind it is to do a number of things. One, is to help the Postal Service right-size the enterprise, kind of like the U.S. auto industry has done as they’ve returned to profitability; second, is to enable them to have the ability to make some money in ways, that frankly, use their unique distribution system, you know, going to every mailbox in the country five or six days a week, how do you use that? Nobody else has that,” Carper said.
“We are encouraged by the recent introduction of comprehensive postal reform legislation in Congress,” Barnett said. “Despite an uncertain legislative process, we are hopeful that legislation can be enacted this year.”
The Postal Service recorded a $15.9 billion net loss last fiscal year and expects to record a loss of roughly $6 billion in the current fiscal year.