The U.S. Postal Service Board of Governors has approved the majority of the changes in domestic rates, fees and classifications proposed in the rate case settlement agreement recommended by the Postal Rate Commission.
The overall increase will be 7.7%, effective June 30.
First class stamps will go up to 37 cents per ounce and another 23 cents for each additional ounce.
Rates will not rise again until 2004, postal officials said, reiterating Postmaster General Jack Potter’s commitment made last Friday.
The expedited manner of this case does not set a standard, or legal precedent, for the next case, said Steve Kearney, vice president of pricing and classification for the USPS.
The Direct Marketing Association supported the BOG decision.
"While we are never pleased when rates increase, we are gratified that the mailing community, the postal service and the Postal Rate Commission could work together to reach this settlement agreement," DMA president H. Robert Wientzen, said in a statement.
Overall Standard Mail rates will increase an average of 7.1%. Specifically, regular and nonprofit Standard Mail rates will increase an average 7.5%. Enhanced carrier route will increase an average 6.2%.
With the increase, the USPS hopes to increase revenue by $500 million to help cover increasing costs and dwindling mail volume caused by the Sept. 11 terrorist attacks, anthrax contamination of the mail and the recession, said Robert Rider, chairman of the BOG.
The postal service lost $1.7 billion in fiscal 2001 and will likely exceed $2 billion this year.
In its second quarter ended Feb. 22, the postal service said it lost $303 million as the agency delivered 1.6 billion fewer pieces of mail than the same period a year ago. More than 1 billion pieces came from Standard mail. Revenue fell 0.3% to $15.6 billion.
Other rate increases include: postcard rates will go up two cents to 23 cents; Priority Mail, will go up 10% to $3.85 for a one-pound package; and Express Mail will go up 9.6% to $13.65.
