Postmaster General Benjamin F. Bailar indicated yesterday that the Postal Service plans to file a request for higher rates "within the next few months," to take effect sometime in 1978.
Although postal rates will remain unchanged for the balance of this year, Bailar said, a formal application must be made shortly "merely to begin the process necessary for getting the authority to raise rates-which would be exercised if and when needed in 1978."
The effective date of the increase, and its amount, will depend on the postal service's financial at the time, Bailar said in remarks prepared for delivery at the Comstock Club, in Sacramento, California.
Bailar confirmed earlier reports that the Postal Service operated with a surplus during the quarter ended Dec. 31, the second quarterly surplus in a row. The recent surplus, $69.8 million, when added to a $15 million surplus in the prior quarter, means that for the last six months, the Postal Service has produced an unprecented $85 million surplus from operations.
Ballar said this turnabout occured "during perhaps the sternest operating test in postal history." In part, the October-December surplus reflected both the 15-state United parcel Service strike and heavy Christmas volume.
The extra parcel colume combined with normal Christmas mailing added up to 400 million pieces of mail a day during the holiday season.
Bailar cautioned that while the surplus does not mean instant financial help, it does "indicate that we have begun for the first time to make significant progess toward complaince with that section of the Postal Reorganization Act which requres that revenues come as close as possible to equalling costs."
Although Bailar provided a few details about the forthcoming rate increase proposal, he did say a major recommendation would be more closely relating the costs of service to some rates. SPecifically, he said periodicals which are presented to the Postal Service pre-sorted in sufficient quantity to go directly to a delivery station would receive a lower rat based on reduced handling costs. In this case, the rate reduction would appear to be between 15 and 20 per cent.
"We must recognize the principle that those who relieve the Postal Service of some of its costs should be compensated accordingly . . . Similarly, we will be looking hard at the monolithic rate structures for parcel post and other categories where ther might be justification for similar changes."
The Postmaster General said the long-term financial outlook is "still clouded" and that "unless we face the future realistically, the progress to date may be undone."
A study commission created by Congress is considering alternatives for postal services and financial aid. Bailar said yesterday he does not favor some of the alternatives begin considered, including massive federal subsidies to continue all services."To avoide facing the hard decisions that might avert a future crisis, some has suggested that cost increases be met simply be subsidies by federal tax payers. It is estimate that this could require subsidies of $21.8 billlion over the next four years . . . What these special interests chose to ignore is that such massive sums might be better applied to other pressing national needs," Bailar asserted.