By David Shepardson
WASHINGTON, Nov 12 (Reuters) – The cash-strapped US Postal Service said on Thursday it is seeking approval for an 11% price hike for domestic priority mail and package deliveries in January to deal with rising fuel costs.
USPS, which needs approval from the Postal Regulatory Commission for the price increase, said it was not planning to hike the price of first-class stamps in January, which rose in July from 78 to 82 cents.
The surcharge is rising from a temporary 8% surcharge that was imposed in April. USPS said this week its transportation expenses in the 12 months ending September 30 rose by $225 million due to higher fuel costs.
USPS said it was proposing to hike overall domestic shipping services prices 5.9% on average and is raising prices by an average of 7.9% for international deliveries.
USPS asked Congress on Tuesday for $2 billion in support and reimbursements as its head warned the agency would be forced to make significant cuts in retail post offices and other reductions unless lawmakers act.
USPS reported an annual $6.5 billion loss versus a net loss of $9 billion in the prior 12 months.
The new Democratic-led Congress, which takes office in January, will need to decide whether to help the Postal Service after Republicans held a series of hearings over the last two years on its finances. USPS wants $2 billion from Congress for unfunded requirements it has imposed.
The agency has recorded net losses of more than $120 billion since 2007. The volume of first-class mail, its most profitable product, fell this year to its lowest level since 1965 as consumers have moved to digital communication, while USPS must still pay for costly nationwide delivery.
Postmaster General David Steiner says the agency has a broken business model and needs help from lawmakers to turn around its operations.
In May, USPS suspended non-essential spending on travel, office supplies and consultants. USPS also earlier this year temporarily suspended employer payments for a federal pension program.
(Reporting by David Shepardson in WashingtonEditing by Bill Berkrot)
