NEW YORK (TheStreet) -- Faced with plummeting mail volume traced to the recession and increased use of the Internet, the Postal Service is projecting a deficit of nearly $7 billion for the next fiscal year.
This, despite eliminating millions of work hours and reducing expenses by more than $1 billion every year since 2001.
Its solution to the problem? The first stamp price increase in almost two years.
The U.S. Postal Service Governors recommend increasing the price of a First-Class stamp by 2 cents to 46 cents and have authorized the production of a pane of four evergreen tree branches as the newest image for Forever Stamps. The price of a postcard would increase by 2 cents to 30 cents.
The Postal Regulatory Commission must approve the recommended price changes. If approved, the proposed price changes would raise about $2.3 billion for the first nine months of 2011, according to the Postal Service. The increases would not go into effect until January 2, 2011.
"There is no one single solution to the dire financial situation that the Postal Service faces," Postmaster General John Potter said. "These proposed rate adjustments are moderate and part of a fair and balanced approach to insuring mail service for all Americans well into the future."
In the meantime, Holiday Evergreen Forever Stamps will be available to the public in October at the current rate of 44 cents. Once purchased, the stamps are valid literally forever -- despite any future price changes.
-- Reported by Andrea Tse in New York
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