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Postal rates increase, under protest

WASHINGTON – The Governors of the U.S. Postal Service today announced that they would allow the recommended decision of the Postal Rate Commission to raise the price of a First Class letter to 34 cents "under protest." New rates for all classes of mail will begin on January 7, 2001.

Board Chairman Einar V. Dyhrkopp once again called for postal reform. "Statutory reform of the nation's postal system is necessary to provide the foundation for a financially secure Postal Service, one that is capable of meeting the needs of the American people today and far into the future," he said.

New 34-cent letter rate stamps will go on sale December 15. The first of the new stamps will be marked " USA FIRST-CLASS". In later stamp printings, the phrase "FIRST- CLASS" will be replaced by the 34-cent amount. Over two billion one-cent stamps are already available for customers to use up supplies of older 33-cent stamps.

The new cost of mailing a two-pound Priority Mail package increases to $3.95, although a new one pound rate is now also available at $3.50. The cost of mailing a one half pound Express Mail package increases to $12.25.

Overall, rates are rising 4.6 percent, although price increases vary some by class of mail in accordance with the legal mandate for each class of mail to cover its own cost. The cost of mailing a letter will increase from 33 to 34 cents. Each additional ounce will decrease from 22 cents to 21 cents. The cost of mailing a postcard will remain 20 cents. International rates will also rise on January 7.

The Postal Reorganization Act grants the presidentially-appointed Governors of the United States Postal Service several options to exercise in response to a recommended decision from the Postal Rate Commission (PRC) Decision.

One of these options is to allow the recommended rates and fees to take effect under protest and return the recommended decision to the Commission for reconsideration (and a further recommended decision). The Governors have elected this option in this case, primarily because of their concerns about the Commission's treatment of the Postal Service's revenue requirement, and certain rate design and costing issues.