United States Postal Service Announces New Prices for 2014
Buy your forever stamps before January 26, 2014 because first class postage is going up! The following chart highlights some of the new prices:
- Letters (1 oz.) — 3-cent increase to 49 cents
- Letters additional ounces — 1-cent increase to 21 cents
- Letters to all international destinations (1 oz.) — $1.15
- Postcards — 1-cent increase to 34 cents
In a letter distributed to customers, Board of Governors Chairman Mickey Barnett described as “precarious” the financial condition of the Postal Service. Barnett also cited the “uncertain path toward enactment of postal reform legislation” as primary reasons for seeking price changes above the CPI increase. He also indicated that the price adjustment above the CPI increase is necessary for the Postal Service to be able to maintain and continue the development of postal services of the type and quality that are needed.
“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,” said Barnett 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. We are encouraged by the recent introduction of comprehensive postal reform legislation in Congress, and despite an uncertain legislative process, we are hopeful that legislation can be enacted this year.”
With the exception of extraordinary circumstances, increases in postal rates are capped at the rate of inflation as measured by the CPI-U. The Postal Service is filing a price increase above CPI-U due to extraordinary and exceptional circumstances which have contributed to continued financial losses. In the most recent fiscal year the Postal Service recorded a $15.9 billion net loss and expects to record a loss of roughly $6 billion in the current fiscal year. Additionally, USPS has intolerably low liquidity even after defaulting on its obligation to make prefunding payments for retiree health benefits.
Pricing for Standard Mail, Periodicals, Package Services and Extra Services also will be adjusted as part of a filing to the Postal Regulatory Commission (PRC) was scheduled to take place Sept. 26.
The Postal Regulatory Commission (PRC) will review the prices before they become effective Jan. 26, 2014, and must agree the prices are consistent with applicable law. The new price proposals are scheduled to be filed Sept. 26 and will be available on the PRC website at www.prc.gov and also will be available at http://pe.usps.com.
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