Reminder: USPS Prices for Mailing and Shipping Go Up January 22
USPS announces updated prices for mailing and shipping services
On Jan. 22, prices for most USPS Mailing and Shipping Services changed. Mailing Services includes domestic and international First-Class Mail, Standard Mail, Periodicals, Package Services and Extra Services.
Highlights include a 1-cent increase to 45-cents in the price of a First-Class Mail stamp and a 3-cent increase to 32-cents in the price of a postcard. The additional ounce rate for single-piece letters remains unchanged at 20-cents. For PO Box customers, a new shorter time period, a 3-month pricing option, is available.
Click here for more information on Mailing Service price changes.
Prices for domestic and international Shipping Services also changed. Shipping Services include Express Mail, Priority Mail, First-Class Package Service, Parcel Select, Parcel Return Service, and other competitive products.
Priority Mail prices increased by an average of 3.1 percent and Express Mail prices increased by an average of 3.4 percent.
Click here for more information on Shipping Services price changes.
Court Sends USPS Case On Rate Hike Rejection Back To PRC
WASHINGTON (AP) — Whether postal rates should rise above the level of inflation is back in the hands of the independent Postal Regulatory Commission.
The federal Court of Appeals for the District of Columbia on Tuesday told the commission to reconsider its rejection of the Postal Service’s request last fall to raise rates. Normally increases are limited to the inflation rate, but the post office cited the unusual circumstances of the recession and the decline in mail volume.
The court said the commission was correct in concluding that, to get the unusual rate increase, the post office must show that the problem is due to the unusual circumstances. But the court said it was wrong to insist that the amount of the increase precisely match the losses caused by those circumstances.
source: Associated Press
Court Sends USPS Rate Case Back to PRC
Postal Service to Adjust Prices
Stamp Price Remains 44 cents; Impact to Retail Customers Minimal
WASHINGTON — The first U.S. Postal Service price change in two years will have minimal impact on retail customers who will continue to pay only 44 cents for a stamp.
The prices filed with the Postal Regulatory Commission today will become effective April 17.
Highlights of the pricing proposal include:
* First-Class letters (1 oz.) remain unchanged at 44 cents,
* First-Class letter additional ounces increase to 20 cents,
* Postcards will cost 29 cents,
* Letters to Canada or Mexico (1 oz.) increase to 80 cents, and
* Letters to other international destinations will remain unchanged at 98 cents.
“While changing prices is always a difficult decision, we have made every effort to keep the impact minimal for consumers and customers doing business with us at retail lobbies,” said Postmaster General Patrick R. Donahoe. “We will continue to balance our business needs against the needs of our customers.”
The overall average increase across all mailing services is capped by law at 1.7 percent – at or below the rate of inflation as measured by the Consumer Price Index – although actual percentage price increases for various products and services will vary.
Prices will change for other mailing services, including Standard Mail, Periodicals, Package Services and Extra Services. Larger volume business mailers will see price increases in a variety of categories. Detailed pricing information will be available later today online at www.usps.com/prices. Today’s announcement does not affect Express Mail and Priority Mail prices.
In July 2010, the Postal Service filed an exigent price proposal that was rejected by the Postal Regulatory Commission in September. The Postal Service filed an appeal of that decision with the United States Court of Appeals for the District of Columbia Circuit in November and awaits a decision.
Faced with decreased mail volume traced to the recession and increased use of the Internet, the Postal Service continues to face a daunting financial crisis. Increasing prices is one of a series of solutions the Postal Service proposed in March 2010 to address the crisis. Other actions outlined in the March plan included changes to delivery frequency, restructuring prepayments of future retiree health benefits, creating a more flexible workforce and expanding access to products and services to places more convenient to customers. In December, Donahoe began a reorganization of all administrative and managerial functions as part of his vision to operate “leaner, faster and smarter.”
The Postal Service receives no tax dollars for operating expenses, and relies on the sale of postage, products and services to fund its operations.
Burrus: Mailers Want To Cut Postal Employees Wages At Least $18,000 Yearly
Burrus Update #13-2010, July 29, 2010
Competing Interests, Diverging Views
In many Updates and editorials on postal issues, I have criticized the influence of large mailers on the USPS — even while acknowledging that they provide much of the volume that makes it possible for the Postal Service to maintain its national network and provide middle-class employment to more than 600,000 Americans. I have frequently pointed out that the interests of these large mailers generally run counter to those of postal employees.
While some union leaders have joined forces with the mailers to achieve narrow legislative objectives, and others speak in favor of partnerships, I have counseled APWU members that the large mailers and postal workers have competing agendas.
A case in point involves the Postal Service’s recent proposal to raise the price of stamps. An association of large mailers, the Affordable Mail Alliance, vehemently opposes the rate hike and filed a protest with the Postal Regulatory Commission, which must consider the USPS proposal.
The mailers’ motion vividly exposes the lack of respect they have for postal employees and the collective bargaining process. A casual review of the document [PDF - see pages 50-62] reveals their callous desire to punish postal workers for the Postal Service’s financial difficulties — difficulties the mailers inadvertently fostered by promoting the Postal Accountability and Enhancement Act of 2006. The PAEA imposed crippling financial obligations on the USPS — obligations that are responsible for the Postal Service’s current predicament. To compensate for their colossal mistake, the major mailers wish to penalize postal workers.
In lieu of an editorial describing my reaction to this vicious attack, I invite postal employees to read the motion and draw their own conclusions.
Exercising Influence
The Affordable Mail Alliance, along with other organizations representing large mailers, influences postal policy by lobbying and applying significant resources to shape legislation. They hope to set the tone for the USPS-APWU contract negotiations scheduled for later this year.
While the opinions of these mailers are not dispositive, it is important that postal workers and their unions understand the power they have on matters affecting postal employment. The opinions expressed in this filing are a frontal attack aimed at eliminating collective bargaining as the vehicle for establishing the terms of employment in the United States Postal Service.
The major mailers wish to amend the law so that the Postal Service would have the unilateral right to set wages and benefits, leaving employees with only one option: Accept it or quit. This is the model the large mailers use with their employees; as they generated billions of dollars in profits from worksharing alone, their employees had no vehicle to demand an appropriate share. It would be interesting to review the salaries of the executives in the companies that form the Alliance and compare them with the salaries of postal employees.
The Alliance asserts that postal wages, benefits, and conditions of employment constitute a pay “premium” of more than 33.9 percent over other workers. Their “analysis” is based on USPS figures that suggest that total postal “compensation,” which includes both wages and benefits, averages more than $80,000 per year.
To put the mailers’ conclusion in context, they believe the wages of bargaining unit employees should be cut by at least $18,000 per year, with corresponding reductions in healthcare, life insurance, leave, and other benefits! The reduction they suggest would represent a loss of approximately $700 each bi-weekly pay period.
Yet the July 26 edition of Business Mailers Review, a newsletter prepared by a representative of the mailers — the very mailers who take exception to the results of free collective bargaining — reported on a study that showed mailers reaped $10.7 billion in “profits” from workshare discounts in 2008 based upon the postal costs avoided. With tongue in cheek, I ask, if postal wages were reduced arbitrarily, would the mailers suggest that workshare discounts should be reduced to the arbitrarily set “cost-avoidance” rate?
The Sides
For those members and observers who have not identified the sides in this struggle, on one side we have the employees who have organized into groups (unions) that are committed to playing by the rules of democracy, negotiating the terms of employment, and resorting to binding arbitration when voluntary agreement cannot be reached. On the other side are the mailers, whose profits are affected by postal employee wages and benefits. These mailers believe in capitalism and democracy — as long as “democracy” excludes the opportunity for workers to have a meaningful voice in their place of employment. The mailers would prefer to eliminate collective bargaining entirely, but if they are forced to accept the process they favor a law that would guarantee the outcome.
I encourage postal employees to closely examine the Alliance’s document to enhance their understanding of the forces engaged in this struggle. Please note that the Alliance analysis is not craft specific. The mailers’ efforts are not targeted to a specific group of postal employees, such as clerks, letter carriers, mail handlers, etc: Their goal is to quench their insatiable thirst for profits at the expense of all postal employees.
The indecent pay and bonuses many CEOs receive do not seem to bother the Alliance; however, they put each advance by working people under a microscope for after-the-fact comparison.
William Burrus
President
More Hypocrisy as Big Mailers Decry Rate Hike
In Run-Up to Postal Reform, They Championed Annual Increases
Burrus Update 11-2010, July 13, 2010
The APWU often criticizes the cozy relationship between large mailers and postal management, but we understand that without the major mailers there would be insufficient mail volume to maintain the Postal Service’s national network and to employ 600,000 workers. “Non-household mail” enables us to fulfill our obligation to serve the American people.
Unfortunately, commercial mailers have been permitted to influence postal management beyond the scope of their contribution. While direct mail accounts for an ever-increasing share of mail volume, its contribution to USPS revenue is a pitiful 20 percent. But the voice of the average citizen, who pays 44 cents postage per letter, is drowned out by those who have access to USPS decision-makers.
The APWU has frequently found fault with the major mailers and some unions for championing “postal reform,” which resulted in the Postal Accountability and Enhancement Act of 2006 (PAEA). History will reflect that this legislation — with its onerous requirement that the USPS must pre-fund more than $5 billion of future retiree healthcare liabilities annually for 10 years — has caused immeasurable damage to the Postal Service. The result has been the degradation of service to the public through facility consolidations, station-and-branch closings, reduced service, and mail delays caused by the need to reduce expenses to satisfy this requirement.
One of the most disturbing aspects of the unhealthy relationship between the USPS and major mailers is the mailers’ reaction to the Postal Service’s recent request for a rate increase under the “exigency provisions” of the PAEA. These provisions allow the USPS to increase postage above the rate of inflation.
The influential mailers have formed an organization, the Affordable Mail Alliance, for the sole purpose of denying the Postal Service the opportunity to increase revenue in response to the pre-funding obligation that the mailers imposed. Included in their near-hysterical reaction to the increase is the refrain that the Postal Service is raising rates “again.”
Despite differences in the legal interpretation of an “exigency,” if the mailers were honest, they would accept responsibility for the legislation that resulted in annual rate increases. Prior to the enactment of the 2006 law, the Postal Service’s mandate was to “break even over time.” The mandate was applied to three-year rate cycles, with the intent that the USPS would generate a surplus in year one; break even in year two, and lose money in year three, thus breaking even over time.
The large mailers insisted to Congress that their business model was best served by annual incremental rate increases rather than larger, less frequent rate hikes. Individual citizens and small businesses voiced no opinion about whether postage should increase by 3 cents every three years or by one cent each year for three years.
It was the large mailers who demanded annual increases tied to the Consumer Price Index; now, however, they have joined the chorus criticizing the Postal Service for raising rates “again.” Despite the differences between the large mailers and the unions, we should at least be honest with the American people: The mailers may disagree with the use of the exigency option, but annual rate increases are of their own doing, and they should take responsibility for them.
William Burrus
President
USPS: Volume Discounts Included in Proposed Price Changes
About 90 Percent of Proposed Price Changes Under 6 Percent
WASHINGTON — Volume discounts and free additional weight are included in the proposed price changes the U.S. Postal Service filed with the Postal Regulatory Commission (PRC) today.
Price changes for the majority of products and services fall between 4 percent and 6 percent. These products and services account for about 90 percent of Market Dominant revenue. The Postal Service Governors approved the recommendation for prices for all 18 Market Dominant products.
Products outside the range include Periodicals (8 percent), Standard Mail Parcels (23 percent) and Media/Library Mail (7 percent). The increases above the average are intended to improve the financial performance of products that currently do not cover costs while limiting the impact on customers.
The filing includes two incentives designed to retain and grow profitable mail volume: “Reply Rides Free” and “Saturation Mail/High Density Incentive Program.”
Reply Rides Free encourages the use of bill and statement mailings for marketing messages. For qualifying customers, a 1.2-ounce piece is charged the 1-ounce price if a reply envelope or card is included in the mailing.
The Saturation Mail/High Density Incentive Program provides rebates for volume growth for Standard Mail and Nonprofit Mail letters and flats. A minimum of six Saturation/High Density mailings in a Fiscal Year is required.
If approved as proposed, the new prices would take effect on Jan. 2, 2011 – almost two years since the Postal Service last raised rates.
The proposed price changes would generate $2.3 billion for the last three quarters of the 2011 Fiscal Year (January to September) and an estimated $3 billion for the full 12 months of Fiscal Year 2012.
Despite eliminating 1 million work hours and reducing expenses by more than $1 billion every year since 2001, a budget gap remains. The proposed price increases will help close a $7 billion projected shortfall in FY 2011. The Postal Service would have needed to raise rates an average of 20 percent across all product lines to completely close that expected gap.
“This proposal is moderate and reasonable and carefully evaluated for its effect on our customers,” said Maura Robinson, vice president, Pricing. “Increasing prices will help overcome some of the financial challenges faced by the Postal Service. We will continue to work with Congress and other stakeholders to implement long-term solutions.”
Postmaster General John E. Potter identified in March a number of actions the Postal Service will pursue, including a change to delivery frequency, expanded access to products and services more convenient to customers and restructuring prepayment of retiree health benefits. Potter was clear at the time that customers would not be asked to close the entire budget gap.
Innovations like Reply Rides Free and Saturation Mail incentive programs reinforce the value of mail, help retain volume and provide opportunities to grow the business. These products also have proven to cover their costs and contribute much needed revenue to the Postal Service. Still, greater product and pricing flexibility is needed if the Postal Service is to remain a vital driver of the American economy.
“Future price increases can be greatly alleviated if the Postal Service is given the tools necessary to be a more flexible, market-oriented company,” Robinson said.
Other highlights from the price filing include:
- First-Class Mail stamps would increase to 46 cents. A new Forever Stamp image will be available in October.
- First-Class Mail postcard prices would increase 2 cents to 30 cents.
- Periodicals would receive an 8 percent increase.
- Recommended increase for catalogs is 5.1 percent.
- Standard Mail parcels would increase about 23 percent.
This is the first time the Postal Service is requesting price increases above the rate of inflation, an action that is allowed under the 2006 Postal law as long as the Postal Service can demonstrate “exceptional or extraordinary circumstance.”
An ongoing recession that has rocked the Postal Service business customer base, continued movement toward electronic alternatives and unprecedented volume loss have created a situation where the price cap of 0.6 percent, based on the Consumer Price Index, is insufficient to cover the extraordinary losses.
The PRC has 90 days to review and make a final ruling on the filing (on or about Oct. 4). The PRC can accept or reject all price requests.
USPS Announces Postage Rate Hike Proposal
Highlights
* First-Class Mail stamps would increase to 46 cents. A new Forever Stamp image will be available in October.
* First-Class Mail postcard prices will increase 2 cents to 30 cents.
* Periodicals will receive an 8 percent increase.
* Recommended increase for catalogs is 5.1 percent.
* Standard Mail parcels will increase about 23 percent.
A new Forever Stamp image will be available as part of a pricing package that would add less than 13 cents a month to the average American household’s budget.
The U.S. Postal Service Governors recommended increasing the price of a First-Class stamp 2 cents to 46 cents and authorized the production of a pane of four evergreen tree branches as the newest image for Forever Stamps. The price of a postcard would increase 2 cents to 30 cents.
The Postal Regulatory Commission must approve the recommended price changes. The increases would not go into effect until Jan. 2, 2011. It would be the first stamp price increase in almost two years.
Holiday Evergreen Forever Stamps will be available to the public in October at the current rate of 44 cents. Once purchased, the stamps are valid literally forever — despite any future price changes.
Faced with plummeting mail volume traced to the recession and increased use of the Internet, the Postal Service is projecting a deficit of nearly $7 billion for the next fiscal year. Despite eliminating 1 million work hours and reducing expenses by more than $1 billion every year since 2001, a budget gap remains.
The proposed price changes, if approved, will raise about $2.3 billion for the first nine months of 2011. Postmaster General John E. Potter said he does not want customers to bear the burden of dramatic price increases. Instead, Potter announced in March that pricing would be one in a series of solutions the Postal Service is pursuing to become financially sound.
“There is no one single solution to the dire financial situation that the Postal Service faces,” Potter said. “These proposed rate adjustments are moderate and part of a fair and balanced approach to insuring mail service for all Americans well into the future.”
Other actions outlined in March included changes to delivery frequency, restructuring prepayments of retiree health benefits, creating a more flexible workforce and expanding access to products and services to places more convenient to customers.
The Postal Service receives no tax dollars for operating expenses, and relies on the sale of postage, products and services to fund its operations.
Complete details of the filing can be found later today at usps.com/prices. No prices will change before 2011.
INCENTIVES INCLUDED IN PRICE FILING
MORE THAN 90 PERCENT OF PROPOSED PRICE CHANGES UNDER 6 PERCENT
Volume discounts and free additional weight are included in the proposed price changes the U.S. Postal Service filed with the Postal Regulatory Commission (PRC) today.
Price changes for the majority of products and services fall between 4 percent and 6 percent. These products and services account for about 92 percent of Market Dominant revenue. The Postal Service Governors approved the recommendation for prices for all 18 Market Dominant products.
Products outside the range include periodicals (8 percent), Standard Mail Parcels (23 percent) and Media/Library Mail (7 percent). The increases above the average are intended to improve the financial performance of products that currently do not cover costs while limiting the impact on customers.
The filing includes two incentives designed to retain and grow profitable mail volume: “Reply Rides Free” and “Saturation Mail/High Density Incentive Program.”
Reply Rides Free encourages the use of bill and statement mailings for marketing messages. For qualifying customers, a 1.2-ounce piece is charged the 1-ounce price if a reply envelope or card is included in the mailing.
The Saturation Mail/High Density Incentive Program provides rebates for volume growth for Standard Mail and Nonprofit Mail letters and flats. A minimum of six Saturation/High Density mailings in a fiscal year is required.
If approved as proposed, the new prices would take effect Jan. 2, 2011 — almost two years since the Postal Service last raised stamp rates.
The proposed price changes would generate $2.3 billion for the last three quarters of the 2011 fiscal year (January to September) and an estimated $3 billion for the full 12 months of fiscal year 2012.
Despite eliminating 1 million work hours and reducing expenses by more than $1 billion every year since 2001, a budget gap remains. The proposed price increases will help close a $7 billion projected shortfall in FY 2011. The Postal Service would have needed to raise rates an average of 20 percent across all product lines to completely close that expected gap.
“This proposal is moderate and reasonable and carefully evaluated the effect on our customers,” said Maura Robinson, vice president, Pricing. “Increasing prices will help overcome some of the financial challenges faced by the Postal Service. We will continue to work with Congress and other stakeholders to implement long-term solutions.”
Postmaster General John E. Potter identified in March a number of actions the Postal Service will pursue, including a change to delivery frequency, expanded access to products and services more convenient to customers and restructuring prepayment of retiree health benefits. Potter was clear at the time that customers would not be asked to close the entire budget gap.
Innovations like Reply Rides Free and Saturation Mail incentive programs reinforce the value of mail, help retain volume and provide opportunities to grow the business. These products also have proven to cover their costs and contribute much needed revenue to the Postal Service. Still, greater product and pricing flexibility is needed if the Postal Service is to remain a vital driver of the American economy.
“Future price increases can be greatly alleviated if the Postal Service is given the tools necessary to be a more flexible, market-oriented company,” Robinson said.
Other highlights from the price filing include:
* First-Class Mail stamps would increase to 46 cents. A new Forever Stamp image will be available in October.
* First-Class Mail postcard prices will increase 2 cents to 30 cents.
* Periodicals will receive an 8 percent increase.
* Recommended increase for catalogs is 5.1 percent.
* Standard Mail parcels will increase about 23 percent.
This is the first time the Postal Service is requesting price increases above the rate of inflation, an action that is allowed under the 2006 Postal law as long as the Postal Service can demonstrate “exceptional or extraordinary circumstance.”
An ongoing recession that has rocked the Postal Service business customer base, continued movement toward electronic alternatives and unprecedented volume loss have created a situation where the price cap of 0.6 percent, based on the Consumer Price Index, is insufficient to cover the extraordinary losses.
The PRC has 90 days to review and make a final ruling on the filing (on or about Oct. 4). The PRC can accept or reject all price requests.
The Postal Service receives no tax dollars for operating expenses, and relies on the sale of postage, products and services to fund its operations.
More detailed information on the price filing will be available later today at usps.com/prices.
via PCC Insider – July 6, 2010 Special Edition.
History of Postage Rates for Domestic Letters 1863-2010
* Beginning September 14, 1975, additional ounces were charged a lower rate. Since July 15, 1979, a surcharge has been added for non-standard envelope sizes.
HISTORIAN
UNITED STATES POSTAL SERVICE
MAY 2009