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Rural Alaskans feeling the crunch of higher postage

Devin Kelly

Like most rural Alaskans, Heidi Ivanoff made sure to visit the grocery store while she and her husband were in Anchorage this week.

While shopping at Costco, Ivanoff decided to buy a 60-pound case of sugar. The case cost a little less than $30, and Ivanoff expected to pay about $20 to ship it back home to Unalakleet.

But at the Huffman branch of the U.S. Post Office, Ivanoff was told her package would be shipped through something called standard post, instead of parcel post. Also, the shipment cost $37.50, nearly double what she anticipated and more than the cost of the sugar itself.

"It was a shock to pay that much," said Ivanoff, 53.

She's one of a growing number of Alaskans, particularly those living in rural areas, feeling the effects of a sweeping set of national rate changes recently introduced by the Postal Service.

The changes, which took effect Jan. 26, include hikes in shipping costs for heavier parcels. In a key shift, the USPS eliminated the parcel post service and changed the name to "standard post," said Ernie Swanson, a Postal Service spokesman for the Alaska region.

Standard post offers comparable rates to priority mail. Compared to the old parcel post rates, sending a package through standard post costs about 35 percent more on average , officials said.

The heavier the package, the greater the cost increase. For a 17-pound package, the increase amounts to 4.9 percent.

But a 25-pound package will cost the sender 22 percent more to send, and for a 50-pound package, the cost more than doubles, to an increase of nearly 53 percent, according to a rate schedule published by the Postal Service.

Bypass mail, more commonly used by businesses for large shipments, will see a more modest increase. Those packages, at least 70 pounds in weight and consolidated onto 1,000-pound pallets, will cost 6.75 percent more to send, or an extra $4 for a 70-pound package.

The new rates come as the financially strapped federal mail service seeks ways to offset deep revenue losses. The Postal Service posted some $27 billion in net losses between 2011 and 2013, according to a September letter published online by Mickey D. Barnett, chairman of the service's board of governors.

"Our business model is inherently inflexible as we have limited ability to adapt to a changing marketplace," Barnett wrote.

On Thursday, Sen. Mark Begich sent a letter to Postmaster General Patrick Donahue, expressing his concern over numerous issues with mail processing in Southeast Alaska, including parcel post shipping. His staff said the senator was planning to meet with Donahue in the coming weeks.

Sen. Lisa Murkowski is also communicating with the Postal Service and deciding a course of action, a spokesman said.

Middy Johnson, the mayor of Unalakleet, was among the public officials in rural Alaska seeking an explanation.

Most rural Alaskans use the parcel shipment service after purchasing food and other items in Anchorage, Johnson said. A dog musher, Johnson said it used to cost about $21 to send a 40-pound bag of dog food.

"Now I don't know what it's going to be," Johnson said.

He's worried about smaller businesses keeping up against retail giants like Amazon, which typically ship through priority mail.

The increase to shipping costs also comes on top of an already higher cost for fuel and utilities in villages in Southwestern Alaska.

"We're getting dinged all over," Johnson said.

Ivanoff, a lifelong Unalakleet resident, said she can find ways to adapt, including shopping on Amazon. But she's especially worried about fellow villagers who live from check to check, don't use credit cards and can't afford the additional expense to ship goods from Anchorage.

At the local grocery store, 10 pounds of sugar costs $16.50, compared to $4.98 at Costco, she said.

The operations manager at the Unalakleet Native Corporation, Chester Millett, said he spent five years working at the post office. Once he caught wind of the rate changes, he did a bit of research.

He said he found out that the Native corporation was less affected because most shipments arrive through bypass mail. But he expects the changes to resonate among individual villagers.

"One of my co-workers' sons just tried to ship something back, and found out the only option was priority mail," Millett said. "We're looking at twice the cost of shipping items."

Reach Devin Kelly at dkelly@adn.com or 257-4314.


By DEVIN KELLY
dkelly@adn.com