January 27

Price of stamp goes up by 3 cents Monday

But the rate increase will be in effect only for about 24 months.

By Lisa Rein
The Washington Post

WASHINGTON — Postage rates on first-class letters and most other mail will rise Monday by 3 cents to help the financially ailing U.S. Postal Service recoup millions of dollars it lost during the economic downturn.

But the largest rate increase in 11 years will be in effect only for about 24 months, the time postal regulators determined it would take the Postal Service to recover recession-related losses.

The new prices will take effect despite legal challenges filed in federal court last week by the mail agency and the industry representing bulk mailers. Both were unhappy with the Postal Regulatory Commission’s Dec. 24 ruling authorizing the increase.

The Postal Service is frustrated because the higher price is not permanent, and the mailers are unhappy because the price boost exceeds the rate of inflation at which postage costs have been capped for years.

The price of a first-class letter will jump to 49 cents, but the Postal Service is not printing new stamps to reflect the change. Instead, it will rely on its “Forever” stamps, which will now cost 49 cents instead of 46.

The Postal Service, which sought a permanent, 6 percent rate increase from regulators, is asking the U.S. Court of Appeals for the District of Columbia Circuit to stop the higher price from being phased out in two years.

The mailing industry, which depends on low postal rates to keep profits healthy, is asking the same court to overturn the ruling, saying the agency’s request for an increase based on recessionary losses masks other, structural problems.

“We hope the legal system will see through the Postal Service’s fuzzy math,” Mary Berner, president of the Association of Magazine Media, said in a statement last week. The association is part of a coalition including direct marketers and newspapers.

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