posted on May 8, 2001 06:05:41 AM
Postal Governors Mull Higher Rates
By RANDOLPH E. SCHMID
WASHINGTON (AP) - The post office's governing board is searching for a solution to the problem of rising costs and shrinking income. The answer could be another rate increase.
Just four months after stamp prices increased by a penny, the postal board is meeting Tuesday to consider overriding the independent Postal Rate Commission and imposing increases it earlier denied.
A new increase would not affect the 34-cent first-class rate that took effect in January, although it could boost prices for post cards and for each additional ounce of first-class mail.
It also could mean increases for other types of mail, including magazines and advertising.
At the same time, the governors are searching for a replacement for Postmaster General William Henderson, who is leaving at the end of May. Speculation has focused on Deputy Postmaster General John Nolan, but others reportedly are also under consideration.
Postal officials say the agency is facing a potential $3 billion loss this year as mail volume slips while costs for fuel, transportation and salaries continue to go up.
The agency already has stopped more than 800 construction projects and has taken other steps to save money. Postal managers also are studying whether to file another request this summer to raise postage prices.
A new rate case could take nearly a year. A quicker step might be to return to the rates imposed in January.
The governors accepted that set of new prices under protest after the Postal Rate Commission turned down portions of their request, filed last year. The reductions cut postal income by an estimated $1 billion for this year, reducing the overall increase from the requested 6 percent to 4.6 percent.
Under the law, rate requests have to be reviewed by the independent Rate Commission before taking effect, and it can reduce the postal service's request.
If the postal Board of Governors feels it is necessary, it can overrule the Rate Commission and impose the prices it originally asked for. It takes a unanimous vote of the governors to do so, but it has happened in the past.
Postal officials also have suggested cutting mail deliveries to five days a week instead of the current six, a proposal that drew a storm of criticism in Congress and elsewhere.
While the post office no longer receives tax money for its operations, it remains a part of the government subject to supervision.
For the past several years postal leaders have sought changes in the law to give them more flexibility in changing rates and services so they can better cope with rising costs and changes in competition.
Long negotiations and hearings produced a bill they felt would solve many of their problems last year, but the measure never came up for a vote and died with the end of the last Congress.
The post office had a $199 million loss last fiscal year, after five years in the black during which it was able to reduce, but not eliminate, accumulated losses from earlier years. Under the law, the agency is required to break even over time.
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On the Net: U.S. Postal Service: http://www.usps.com
posted on May 8, 2001 06:39:29 AM
Hmmm...if USPS raises prices even more, then chances are they'll earn a lot less from my auctions. Since the most recent price hike, I went from almost 100% priority mail shipments to maybe 50%. I sell a lot of stuff on the heavier side, and when a package gets above 4# there's almost no chance that USPS will be the most cost-effective method of shipment for my bidders.
(Edited to fix UBB and to add
Right now media mail is usually the cheapest option for books--hope they don't screw around with that rate too much or it could kill my book sales.
posted on May 8, 2001 07:21:00 AM
On another thread someone commented that they heard on the news that the USPS was raising the rates effective July 1st. I just got back from my PO and I asked them about it and they said they hadn't heard a thing about it - but I was the 2nd one this morning to ask about it...
posted on May 8, 2001 07:33:50 AM
"Under the new schedule, rates for a one ounce First-Class letter remain the same at 34-cents, but the charge for an additional ounce will now rise to 23-cents. Postcards will increase by one cent to 21-cents..."
Priority Mail rates will not change, HOWEVER, Media Mail (book rate) is increasing by 3 cents.
posted on May 8, 2001 08:03:11 AM
I just heard on NPR that priority rates ARE also going up, but I missed the details. Sheesh. Why can't they just hike it a big amount and stick with it? I'd almost prefer higher rates to not having them change every five minutes.
posted on May 8, 2001 08:17:07 AM
Postal officials say the agency is facing a potential $3 billion loss this year as mail volume slips while costs for fuel, transportation and salaries continue to go up.
Yeah I can see the fuel cost and salary thingies going up but how can they possibly claim volume is down?
I for one could count the number of packages i shipped my entire life on one hand before I found online auctions a year ago.
Now I spend $200 on a slow month and $400+ on my busy months (december february and wedding season)
And I spend a sizable chunk of money for the shipping of crap I bid on
The boom of online auctions in the last 2-3 years should have them cheering not crying.
Even the small mom and pop e-commerce sites ship with USPS. I do and so do the ones I have bought from as well.
Every post office I use is jam packed with long lines.
I think the USPS should cough up a graph or bar chart and show this decline in volume.
Frankly I can't see it. I want proof lol
http://www.lovepotions.net
posted on May 8, 2001 08:27:04 AM
ExecutiveGirl --
Don't believe anything from the PO clerks or managers.
(I don't mean this sentence as a slam, just pointing out a fact) : They are either entirely clueless or have been instructed to lie to you by claiming no knowledge.
Back in December I was at the post office every 3 days for a few weeks. People would be asking what the new rates would be and they always answered that they have not been informed of any rate increases OTHER than .33 to .34 for first class mail (as they needed since they had to sell 1 cent stamps).
When asked if "other rates" were going up they said they don't know.
The fact was that ALL of us here and on eBay knew the EXACT rates as early as october and the hinted at rates back last summer from their public submissions.
When they answered someone what Priority mail was going up to, they replied "I don't know".
I replied to the other customer: "It's increasing from 15% to 20%.. $3.20 becomes $3.50 and $3.95, $4.30 becomes $5.15"... You should have SEEN the nasty looks I got from the clerks!!!!
And the even sadder thing was: All of this information was posted in HTML and PDF files linked right off the USPS Homepage at that time for ALL the public to see.
[ edited by mrlatenite on May 8, 2001 08:29 AM ]
posted on May 8, 2001 08:35:26 AM
There are many things I've stopped buying on ebay because of the high postage. The final price (total) just isn't worth it.
I think USPS should be forced to stop all advertising. There's a lot of bucks they'd save.
posted on May 8, 2001 08:41:39 AM
Heres the link to the OFFICIAL STATEMENT by the post office on their site, AND a summary of the increases: (Money orders increase from 75 to 90 cents!.. Looks like my gas station will continue getting my 19 cents for a western union MO!)
posted on May 8, 2001 09:06:41 AM
Wait a minute!!??? The money the USPS makes off of selling "damaged packages" on E-bay, isn't that profit?????? From some of the prices they get on there, they shouldn't have to raise any shipping prices. Am I wrong???
posted on May 8, 2001 09:26:45 AM
What I find a little weird is that there are rate hikes, but USPS still continues to give away shipping materials for free.
Dunno about anyone else, but I don't use priority mail because I can use a free box.
posted on May 8, 2001 09:55:09 AM
Thank goodness Priority Mail is staying the same for 1 and 2 lbs, and going up very little for heavier amounts. Still...I'll probably do some checking into alternatives to Priority.
I guess the question I have is...how can the Postal Service be losing that much money, as much as they say they're losing? I find it hard to believe. I heard from one of the local tellers that they have almost as many supervisors as they do tellers and delivery people...hhmmmmm, anyone see a problem here? They don't receive tax $$ anymore, but I have a feeling they've slipped back into their $$-wasting ways.
If USPS keeps jacking with the rates, they're going to cut their own throats...and may have done so already.
"Who's tending the bar? Sniping works up a thirst"
posted on May 8, 2001 12:13:18 PM
There have been several threads in the last month or so about FedEx Home Delivery (FedEx Ground is for business delivery). FedEx.come website has all the info if you want to price your packages (works to your advantage if it's over a few pounds--tracking and $100 insurance is included in the price). If you have high volume and can get an account with them, I believe I read that they will pick up at your house.
posted on May 8, 2001 01:15:00 PM
FedEx just had a press release and stated their earnings are down and volume has dropped. UPS annouced the same earlier.
If fuel prices don't stop rising, all shippers will be increasing rates.
But I have yet to find a better deal than USPS. Perhaps it is because they are losing money ?
posted on May 8, 2001 07:18:30 PM
While it is good to discuss this Postal hike here, it is more effective to contact your US Senator or Representative via telephone, email or a letter. Most likely if every eBay users contacted their representatives in Washington with their objections there wouldn't be a raise.
posted on May 8, 2001 08:02:15 PM
Maybe only booksellers notice this, but since the last increase, there are now two "book" rates. One is media mail and the other is bound-printed. I am frequently startled by how inexpensive the BP rate is, depending on weight and zone. I am sure there are times I innocently charge my buyer $3 and end up paying just over $2. The parcels take a while and they are not returned if undelivered. But despite my large mailing volume these days, I have very few problems with undelivered mail.
I just wonder why they decided to institute such an inexpensive new rate.
posted on May 8, 2001 08:36:56 PM
Dunno if this is true, but I heard from a postal worker that the USPS has spent BILLIONS of dollars on machines to do automated mail sorting down to the individual carrier level. But the automated sorting technology has never worked at the levels necessary for the machines to pay for themselves (by savings in human salaries) and have been a financial drain on the USPS.
The machines are like 10-15 years old and are now breaking down all the time. Maintenance is expensive and replacing them is expensive. I got the impression these are one-of-a-kind machines, like when the Air Force contracts with Boeing to build a jet or something.
posted on May 8, 2001 11:26:30 PM
rubylane
You are correct in that the machines (dps)are 10-15 years old. But we have technicians specially trained just for these machines.
The letters are sorted into delivery sequence. The machines read the barcodes you see on the bottom of your letters.
The carriers have to still manually sort the letters that are too thick for the machines, have glossy plastic windows over the address, or have illegible writing.
mrlatenite:They are either entirely clueless or have been instructed to lie to you by claiming no knowledge.
We are not lieing, we are not informed about anything! I find out about the price hikes from the news and the USPS website (and here) just like everyone else.
It is a running gag at out office that they don't want well-informed employee's because then the employee's would start to think for themselves and ask questions. Management just wants followers.
There is serious talk about deregulating the USPS. There is a decrease in 1st class letter mailings. What with emails and bill paying online. Whenever the USPS tries to venture into new areas for increase in income, UPS charges in and stops it; "infringeing on the private business sector..."
The only way for the USPS to prosper and move forward is to deregulate. Either get assist. from Canada (the only postal service I see MORE complaints about than the USPS) or Germany.
This way they will not have to ask for "permission" for price hikes (UPS and Fedex don't have to get permission, they just do it), and for the USPS to get into other areas of income...
Whenever the USPS raises rates, UPS and FEDeX follows...
posted on May 8, 2001 11:29:16 PM
Just came across this today, should be interesting........
US court of federal claims last month ruled in favor of USPS and Federal Express Corporation's transportation agreement, which is scheduled to be implemented in august. Under the agreement FedEx will transport Express and Priority Mail in its existing air system. Emery had challenged the validity of the agreement before the court saying the contract should have been competitively bid.
posted on May 8, 2001 11:37:37 PM
...and in exchange for this service the USPS agreed to allow Fedex drop boxes at major postal facilities. UPS and Emery got upset so now UPS drop boxes will also be allowed. Emery hasn't been given this privilege (that I know of).
At one time the talks were even considering allowing Fedex to deliver the business priority/express and USPS would deliver the fedex residential priority/express deliveries but the letter carrier union fought and got this removed.
Sniping works up a thirst"