Mail costs to increase Jan. 8

The price of first-class postage stamps will jump 2 cents Jan. 8 and other mailing rates also will increase.

The cost of mailing a letter will go from 37 cents to 39 cents next week, the first increase in postage fees since June 2002. The higher rates are necessary, Postmaster General John E. Potter said, if the post office is to fulfill the requirements of The Postal Civil Service Retirement Funding Reform Act of 2003. The Act changed the way the Postal Service funds its Civil Service pension obligations and required the Postal Service to use "savings" it realized from that change to pay down debt and maintain current rates through the end of 2005.

The rate increase was requested last April.

The post office has seen a decline in first-class mail and, like other businesses, has had increasingly high fuel costs. Chief Financial Officer Richard J. Strasser Jr. said the U.S. Postal Service is projecting a sound financial outlook for this year, and essentially will balance a projected $68 billion budget.

Three years ago the Postal Service committed to take $5 billion in savings and cost avoidances from its annual spending by this year. Potter said $4 billion was saved in the first three years.

Postal Service officials say they will absorb higher fuels costs and offset inflation-driven health benefits cost increases through another year of cost reductions.

Volume forecasts say the post office can look forward to a 2.1-billion-piece decline in first-class mail volume this fiscal year, which began Oct. 1. Standard mail is expected to grow by nearly 3.8 billion

The following rate changes will begin Jan. 8:

• First-class mail, first ounce, up 2 cents to 39 cents.
• First-class, each additional ounce, up 1 cent to 24 cents.
• Post card, up 1 cent to 24 cents.
• Priority Mail, base rate up 20 cents to $4.05.
• Priority Mail, one pound, up 30 cents to $6.15.
• Express Mail, 8 ounces, up 75 cents to $14.40.
• Parcel Post, 2 pounds, up 22 cents to $4.36.
• Certified mail, up 10 cents to $2.40.
• Money orders up 5 cents to 95 cents.
• Weekly news magazine, up 1 cent to 18.5 cents.
• Household magazine, up 1.5 cents to 28.9 cents.
• In-county newspaper, down 0.2 cents to 5.8 cents.
• Small nonprofit publication, up 1.4 cents to 28.3 cents.
• Presorted advertising mail, 2 ounces, up 1.1 cents to 21.4 cents.