Stamp Price To Increase Jan. 7

WASHINGTON (AP) â€” The price of sending a letter will go up a penny â€” to 34 cents â€” on Jan. 7. <br><br>The board of governors of the Postal Service set the date for the increase on Tuesday, accepting

Tuesday, December 5th 2000, 12:00 am

By: News On 6

WASHINGTON (AP) â€” The price of sending a letter will go up a penny â€” to 34 cents â€” on Jan. 7.

The board of governors of the Postal Service set the date for the increase on Tuesday, accepting under protest the Postal Rate Commission's series of recommended prices.

``We will implement the recommended decision, but are returning it to the commission for further consideration,'' said Board Chairman Einar V. Dyhrkopp.

While the independent rate commission agreed with the post office's requested 34-cent first-class rate, it reduced the agency's proposed increases in other areas.

For example, under the rates recommended by the commission, a letter will cost 34 cents for the first ounce, but the second ounce will cost 21 cents, a penny less than at present.

The result of that and other changes, Dyhrkopp said, will not provide sufficient revenue for the agency.

``We cannot accept a situation that threatens the ability of this organization to provide the levels of service that the American people expect and deserve,'' he said.

Postmaster General William Henderson said the cuts made by the rate commission reduced the post office's planned contingency fund by $1 billion.

The post office is currently in arbitration with three of its largest labor unions and it expects to need the added income to pay higher salaries and to meet other rising costs, including fuel and equipment.

And, also at Tuesday's meeting, post office chief financial officer Richard J. Strasser Jr. reported the agency finished fiscal 2000 with a $199 million loss.

The post office had been in the black for several years, but the request for a rate increase had been made in January in anticipation of a small loss in 2000 and a larger one in 2001.

Changing postage prices is a complex process beginning when the postal service sends a request to the rate commission. The commission then holds hearings and has 10 months to reply with a series of recommendations of its own.

The post office can then accept that set of rates, accept them under protest and ask for reconsideration or reject them. The postal governors can overrule the rate commission and impose their own rates, but only if they vote to do so unanimously.

â€”â€”â€”

On the net:

Postal service: http://www.usps.com