WASHINGTON (CBSNewYork) — The cost of mailing a letter is going to drop, but the United States Postal Service says they’ll be paying the price.
Starting Sunday, the price of a first-class stamp drops two cents, to 47 cents. Postcard stamps will drop in price by one cent to 34 cents, 2-ounce letter stamps will drop from 71 cents to 68 cents and 3-ounce letter stamps will drop from 93 cents to 89 cents. Commercial prices will also decrease.
The USPS says the reduction is a result of a mandate from the Postal Regulatory Commission after the government failed to renew a 2014 surcharge instated to help recover $4.6 billion in revenue losses due to the Great Recession in the late 2000s.
But the USPS says the $4.6 billion recoup only partially aided the organization, which reported $7 billion in revenue losses in 2009 alone, according to a release from USPS.
The USPS says the new decrease in stamp price will cost the organization around $2 billion in annual revenue.
“Given our precarious financial condition and ongoing business needs, the price reduction required by the PRC exacerbates our losses,” said Megan J. Brennan, Postmaster General and CEO in a statement. “This unfortunate decision heightens the importance of the review of our ratemaking system, which our regulator is required to conduct later this year.”
The USPS said it plans to take steps toward congressional action to bring back the surcharge.
The Postal Service, however, said it just saw its first profitable quarter following $15 billions in losses over the past decade.
According to Fortune Magazine, this is the first time the USPS has lowered the price of stamps in close to 100 years.
Customers on Friday streamed in and out of the Plainview, Long Island, post office gleeful at word the cost of a stamp will soon drop, CBS2’s Ilana Gold reported.
“I think it’s going to be great,” Ashley Chevlin, of Bellmore, told TV 10/55 Long Island Bureau Chief Richard Rose. “This is going to help our business. We mail a lot of letters out.”
“Whoa! That’s just wonderful,” said Mollie Brown, general manager of a lighting company. “My boss will be very happy where I work that we are finally reducing a stamp price.”
“I read somewhere they have to pre-fund the pension for a certain amount of years, which is the only system that is required by law to do that,” said Plainview English teacher Paul Shaw.
Shaw is right about Congress forcing the Postal Service to overfund its pension system.
But the tens of thousands of employees in the Postal Service unions fear any change in funding could threaten retirement payouts should the USPS go bankrupt.
It’s why Shaw said to enjoy the price cut while you can.
“Buy stamps right now before it goes up,” he said. “Take advantage of the two cents because it’s not going to last long.”