Direct Marketing, Mail Order, and E-commerce News from the National Mail Order Association

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New rates go into effect January 8

WASHINGTON - The Governors of the U.S. Postal Service today voted to accept the Postal Rate
Commission's recommendations to increase most postal rates and fees by approximately 5.4 percent
across-the-board to take effect January 8.

This rate increase - the first since 2002 - is needed to fulfill the requirement of a federal law passed in 2003.
That law requires the Postal Service to establish a $3.1 billion escrow account, with use of the funds to be
determined by Congress at a later date. Without this federal mandate, it would not have been necessary to
raise rates in 2006.

Among the rate adjustments, the single-piece rate for First-Class Mail will increase from 37 cents to 39
cents, and the postcard rate will increase by one cent to 24 cents. The Board of Governors of the Postal
Service set January 8, 2006, as the effective date for the changes.

Jim Miller, Chairman of the Postal Service's Board of Governors, said: "The Governors take this action
mindful of our obligation to assure the financial integrity of the nation's postal system. These increases will
allow the Postal Service to meet the obligation established by Congress to place funds in escrow in 2006."

The Commission's Recommended Decision came after a proceeding in which most of the participants
signed a settlement agreement adopting the Postal Service's uniform, across-the-board increase proposals.
The settlement shortened to six months the Commission's administrative review, which normally takes ten
months.

International rates, which are determined separately from domestic prices, will be adjusted to coincide
with the domestic rate changes. International rates have not been adjusted since January 2001.

For a chart on selected rates, please see below.

Selected Rate Changes

  Current New
First-Class Letter (1 oz.) 37 39
First-Class Letter (2 oz.) 60 63
Postcard 23 24
Priority Mail (1 lb.) $3.85 $4.05
Express Mail (1/2 lb) $13.65 $14.40
Express Mail (2 lb) $17.85 $18.80

Fee and Service Changes

  Current New
Certified Mail $2.30 $2.40
Delivery Confirmation (Priority) 45 50
Delivery Confirmation (First Class Parcels) 55 60
Return Receipt (Original Signature) $1.75 $1.85
Return Receipt (Electronic) $1.30 $1.35
Money Orders (up to $500) 90 95

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