Postal Rates for Charities Could Rise by 8% in 2007

The U.S. Postal Service on Wednesday proposed new rates that would increase postage costs for charities by 8.4 percent, on average. The new rates are not expected to take effect until at least May 2007.

The proposal comes less than one year after the last postage increase: Charities began paying an average of 5.4 percent more for postage in January.

Postal officials said that organizations that rely on mass mailings, including charities that mail fund-raising solicitations and other materials, would be able to reduce the impact of the proposed increase by taking advantage of new postal discounts that will be based on both the weight and shape of mailings.

For example, charities could mix periodicals with standard letter-sized mail to qualify for discounts on some bulk mailings; such a mail mixture has not previously been eligible for postal disccounts.

But such discounts offer little comfort for charities, said Ellenor Kirkconnell, acting executive director of the Alliance for Nonprofit Mailers, a coalition of several hundred charities that lobbies Congress and other government officials on postage issues.

Ms. Kirkconnell said many groups would face increases far larger than the average amount. For instance, organizations that mail periodicals might have to pay as much as 24 percent more to send those publications. And, she added, it will be particularly difficult for charities to shoulder an additional increase in postage after they just started paying higher rates in January.

The Postal Service said it needed to raise rates because of rising fuel costs and the increasing expense of employee benefits.

The Postal Service's proposal is the first step in a lengthy process involved in setting new rates. Before higher rates can be adopted, the Postal Rate Commission, an independent body, must review the proposal and hold hearings to determine whether to recommend the new rates. The Postal Service Board of Governors must then approve the increases and determine the date on which they take effect.