For the first time in nearly a century, the United States Postal Service is reducing rates effective Sunday, as part of forced price reductions being imposed by the Postal Regulatory Commission.
The price for a 1-ounce stamp will decrease from 49 cents to 47 cents. The cost for a postcard stamp will go from 35 cents to 34 cents.
USPS estimates that it will lose $2 billion annually from the price drop. Officials from the post office said the price drop worsens an already dire financial situation for USPS.
“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.”
USPS said that it has reduced costs by $15 billion since 2008, as the service has seen a decline in usage. USPS is completely self-funded and does not use tax revenue.
The Postal Regulatory Commission was formed in 1970 and sets rates for the USPS, as well as works with the State Department on international mail issues.
“To properly compete for customers and continue to meet America’s evolving mailing and shipping needs, the Postal Service needs the financial capability to invest in the future,” said Brennan. “We continue to seek legislative reforms to put the Postal Service back on a sustainable financial path, and pricing is an important component.”