WASHINGTON - There is a penalty for failure to put additional postage on first-class mail starting Sunday - your mail will be returned to you.
About a month after winning approval to boost first-class mail rates by a penny - from 33 cents to 34 cents - the U.S. Postal Service quickly is moving ahead to impose the higher rate "because we're so far in the hole" financially, spokesman Greg Frey said.
Mail processed Sunday, Jan. 7, or later must have the correct higher postage or it will be returned to sender, he said.
Even with the postage hike, the U.S. Postal Service projects a revenue loss of about $480 million this fiscal year.
The agency, under a 1970 federal law, has to win approval from the Postal Rate Commission for any postage increases. The commission approved less than postal officials requested - a 4.6 percent increase instead of more than 6 percent.
The last first-class rate hike was two years ago when there was another penny increase.
All classes of mail this year, even advertising sent at bulk rate, face higher rates of about 4.6 percent.
About 2 billion 1-cent stamps have been distributed. Another 2 billion soon will be shipped nationally to use until the supply of 33-cent stamps is exhausted.
Also, about 7.6 billion stamps saying "First Class" have been shipped nationally for use as 34-cent stamps until new stamps saying "34" appear on the general market Jan. 22.
The Postal Service delivers 208 billion pieces of mail a year, and one-fourth of revenues come from first-class pieces, Frey said.
The congressional General Accounting Office predicted last year that Postal Service's first-class mail growth will level in 2004 and 2005 because of competition, and total volume will begin declining about 2005.
For a $1 handling fee, stamps may be ordered by phone (1-800-STAMP-24) or by Web site, www.usps.com.
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