DOR projecting quarter million increase in costs for postage

  

JEFFERSON CITY, Mo. — The Missouri Department of Revenue is projecting postage costs to increase by as much as a quarter million dollars.

In correspondences, obtained by the Missouri Times through a sunshine request, the Department of Revenue cited a “budgetary impact of the postage rate increase for FY19 is estimated to be $200,000 – $250,000” based on FY 2017 department mail volumes.

The United States Postal Service increased the price of stamps on January 21, 2018. Mailing services increased nearly 2 percent; $0.49 to $0.50 for first class mail, $0.46 to $0.47 for metered mail and $0.34 to $0.35 for postcards.

In an email exchange stemming from the state’s chief operating officer asking cabinet members to look for ways to reduce their budget, the Department of Revenue originally proposed a $500,000 postage restriction for FY 2019 but later revised the figure.

“Due to the January 21, 2018 postage rate increase, I recommend a $250,000 postage restriction for FY19,” the email said.

In the original reduction proposal, it states cutting the postage budget for the department would “reduce the DOR’s ability to absorb postage rate increases by the USPS and upgrade equipment to mail refunds, titles, and notices.”

The Department of Revenue has two inserting machines. One that can only process checks and notices, while the other can process checks, notices, and titles.

“The DOR does not have a backup machine to process titles,” the original budget worksheet states. “A new inserter costs $390,000. If the equipment cannot be replaced and the aging inserter requires maintenance, DOR would not be able to mail titles to Missouri citizens.”

The budget issues come as the state struggles to issue tax refunds on time.

In his budget proposal, Gov. Eric Greitens suggested the state take out a $250 million loan to pay tax returns on time. The idea was described as the equivalent of seeking an advance and that the state would have to pay it back with interest, but that they would make it “pretty close to cost neutral.”

Rep. Scott Fitzpatrick, Chairman of the House Budget Committee, shot down the idea saying, “We’re not going to do this.”