Are USPS Postage Rates About to Fall?

The cost of mailing a letter in the United States could soon decrease for the first time in nearly 100 years.

Under this planned reduction, which without congressional intervention is set to occur April 10, the current cost of 49 cents per ounce would fall to 47 cents per ounce.

Other rates would also fall:

• Letters weighing more than 1 ounce: 21 cents per additional ounce (down from 22 cents)
• Letters to all international destinations: $1.15 (down from $1.20)
• Postcards: 34 cents (down from 35 cents)

Commercial prices would decrease as well.

While this sounds like great news for consumers, the U.S. Postal Service reports that it’s dire news for the independent agency of the federal government.The Postal Service recently announced that its net losses would increase by about $2 billion annually if the postal rate decrease were allowed to occur.

Business Insider reports that the planned decrease dates back to legislation passed by Congress in December 2013 authorizing the Postal Service to add a temporary 4.3 percent surcharge to help the struggling agency recover in the wake of the Great Recession.

That surcharge was due to expire after it generated $4.6 billion in revenue for the Postal Service, which the agency expects to happen April 10.

Postmaster General and CEO Megan J. Brennan said in the recent announcement:

“Removing the surcharge and reducing our prices is an irrational outcome considering the Postal Service’s precarious financial condition. …

Our current pricing regime is unworkable and should be replaced with a system that provides greater pricing flexibility and better reflects the economic challenges facing the Postal Service.”

The Postal Service’s operations are funded by the sale of postage, products and services, according to its latest news release. The agency does not receive tax dollars for operating expenses.

The last time the postage rate for a 1-ounce letter decreased was on July 1, 1919, when the rate fell from 3 cents to 2 cents, according to Postal Service historical data.

Congress or the courts would have to act to extend the current pricing or make it permanent.

What’s your take on this matter — should postage costs be allowed to decrease or should Congress or the courts intervene to keep costs where they are? Share your thoughts in a comment below or on our Facebook page.