After 111 Years, Postage Stamps Go Private

By Bill McAllister
Special to The Washington Post
Monday, June 13, 2005

The federal government printed its last postage stamps Friday.

The end to 111 years of stamp production by the Bureau of Engraving and Printing (BEP) came without any public ceremony in the same 14th Street building where many of the nation's most famous stamps have been printed.

Workers pulled a final roll of 37-cent flag stamps from an aging, four-color Andreotti press on the fourth floor. That simple act terminated a once-thriving business that the Treasury Department agency had monopolized for decades.

Now, private printers will produce all the nation's stamps, a decision that U.S. Postal Service officials say will save tens of millions of dollars a year. The bureau will concentrate on printing currency, its other major product.

For Washington's 60 remaining stamp printers and many stamp collectors, Friday marked a sad transition. Lawrence T. Graves, one of BEP's senior stamp officials, called it "bittersweet . . . a sad day."

"It's the end of an era that reflected some of finest workmanship in government stamp design and security printing worldwide," said Rob Haeseler, an official of the American Philatelic Society, the nation's largest organization for stamp collectors.

Finances and what BEP Director Thomas A. Ferguson said was a decision to no longer treat stamps like currency led postal officials away from the hand-engraved stamps that were the bureau's hallmark and toward cheaper, lithographed stamps. In the end, the bureau, with its elaborate security system, unionized printers and large government payroll, declared it could not compete with private printers.

The Postal Service actually began to chip away at the government printing with a contract that gave some commemorative stamps to private printers in 1978. The private printers' share of stamp production grew steadily and accelerated when the agency turned to self-adhesive stamps in the early 1990s.

Even so, Jerry L. Hudson Sr., chief of BEP's stamp production, said officials were stunned when postal officials suggested in 1995 that they wanted to end the bureau's stamp production altogether.

"We were very disappointed when this process started because we had been in this stamp production for over 100 years, and there is a lot of history here and an awful lot of postage stamps," Hudson said. "On the other hand, we understand that times change."

When the end approached, the bureau arranged buyouts, retirements and currency printing jobs for the stamp printers. They decided against a final ceremony, fearing it might prove "too maudlin," said Ferguson, who began his bureau career more than 30 years ago as a stamp quality expert.

"Everyone here is proud of our contribution to the stamp program, and [we] know that our work will live on in the albums of the collector community for generations," Ferguson added.

Postal officials say the switch has already saved them a lot of money. The Postal Service has three firms printing stamps and said that competition cut its printing costs to $88.5 million in fiscal 2004 from a high of $135.5 million in fiscal 2001.

Overall stamp production climbed at the same time to 43.7 billion.

Ironically, many of the stamps the bureau printed last week may never be sold.

If the Postal Service wins its recent request for a two-cent hike to a 39-cent stamp, to be effective early next year, Hudson said, there will no need for the bureau's last stamp run.

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