The Postal Service may soon gain more freedom to raise stamp prices.
WASHINGTON — It may be time to stock up on Forever stamps.
Regulators appear likely to accept the financially beleaguered Postal Service’s request for more freedom to raise the price of mailing letters. It would be the biggest change in the Postal Service’s pricing system in nearly a half-century, allowing stamp prices to rise beyond the rate of inflation.
After a 10-year review, the Postal Regulatory Commission could make its decision next month. It might limit how high prices could go, but the cost of a first-class stamp, now 49 cents, could jump. It’s not known how much.
Financial analysts praise the plan, but it has raised the ire of the mail-order industry, which could pay millions more for sending items like prescription drugs and magazines and pass the costs on to consumers.
The Postal Service is trying to stay financially afloat as it seeks to invest billions in new delivery trucks to get packages more nimbly to American homes.
An independent agency of government, the Postal Service has lost money for 10 consecutive years. While online shopping has led to years of doubledigit growth in its packagedelivery business, it hasn’t offset declines in first-class mail. Overall mail volume, which makes up more than two-thirds of postal revenue, dropped 27 percent over the last decade.
Congress’ failure to address the Postal Service’s financial woes, such as onerous requirements to pre-fund retiree health benefits, has left the commission more likely to embrace the request for more pricing freedom. The Postal Service has ruled out closing post offices and ending Saturday delivery.
Robert Taub, the Republican chairman of the regulatory commission, declined to comment on the upcoming decision but stressed a need to fix the balance sheet at the 242-year-old Postal Service, which generates $71 billion in annual revenue.
The decision comes as internet sales continue to flourish. Forty percent of the e-commerce giant’s packages are delivered by the Postal Service, compared with 20 to 25 percent by UPS and 15 to 20 percent for FedEx, thanks to lower delivery rates the Postal Service can offer by tapping into a network that already delivers to every U.S. household six days a week.
Still, growing competition is challenging postal dominance in the “last mile” portion of delivery, usually the priciest stretch of a package’s journey. Amazon has been testing the use of drones and launched Amazon Flex, a network of contract drivers. UPS has been trying deliveries via golf carts.