Semi-postal Stamps: Authorization, Revenue, and Selection Process

Semipostal Stamps: Authorization, Revenue,
and Selection Process
Kevin R. Kosar
Analyst in American National Government
Government and Finance Division
Pamela A. Hairston
Information Research Specialist
Knowledge Services Group
Semipostal stamps, postage sold at a premium to raise funds for particular causes,
have only recently been authorized by Congress for use in the United States. The Breast
Cancer Research Stamp (BCRS) was introduced in July 1998, and as of December 2007,
has raised over $60.1 million to support research in treating breast cancer through
distributions to designated agencies. In the 106th Congress, the Semipostal
Authorization Act of 2000 extended the BCRS two years and authorized the U.S. Postal
Service (USPS) to issue other semipostals until 2010. USPS issued regulations inviting
public nominations for future semipostals, providing that each can be sold for two years
but only one can be on sale at any given time. Subsequent Congresses have furtherth
extended the life of the BCRS. Most recently, the 110 Congress authorized its sale
through December 31, 2011. The breast cancer stamp’s success is no guarantee that
other semipostals will be equally successful. The “Heroes of 2001” stamp did not sell
especially well and was withdrawn from circulation. This report will be updated at the
beginning of each new Congress.
Semipostal Stamps
Semipostal stamps are regular postage stamps that are sold at a surcharge over their
postage value.1 The additional charge is recognized by the stamp purchaser as a voluntary
contribution to a designated cause. Europe has a long tradition of using semipostal
stamps to raise funds for worthy causes. Some of the causes supported by European
semipostals include child health, literacy programs, national sports development, and
philately (stamp collecting). The Netherlands, for example, has a tradition in which

1 This report originally was written by Nye Stevens, who has retired from CRS. Readers may
contact Kevin R. Kosar with questions on semipostal stamps.

children go door-to-door to sell semipostals with a 50% surcharge to benefit children’s
health and welfare causes.
In the United States, however, semipostals are a recent innovation. USPS has long
opposed their issuance. While commemorative stamps have from time to time been
issued to raise awareness of social or health problems in the nation,2 USPS was reluctant
to get into the fund-raising business. USPS argued that there was a strong tradition of
private philanthropy in this country, and “due to the vast number of worthy fund-raising
organizations in existence, it would be difficult to single out specific ones to receive
[semipostal] revenue.”3 USPS also warned that the administrative costs involved in
accounting for sales would tend to outweigh the revenues derived from the surcharge.
Philatelic groups also opposed semipostals. They generally thought that USPS was
issuing too many commemorative stamps, with a broader clientele in mind than that of
the stamp collector. Semipostals were a departure from the tradition that stamps are for
postage. Collectors regarded the semipostal surcharge as a tax on their hobby, and
pointed out that unlike other citizens who might be unsympathetic to the cause being
supported, they still had to buy the stamp or their collections would be incomplete.
The Breast Cancer Research Stamp
Despite USPS opposition, Congress authorized a semipostal stamp for the benefit
of breast cancer research in 1997. The idea had first been broached by Dr. Ernie Bodai,
chief of surgery at the Kaiser Permanente Medical Center in Sacramento, California, a
constituent of Representative Vic Fazio. On May 7, 1996, Representative Fazio
introduced the first semipostal bill, H.R. 3401, in the 104th Congress, as the Breast Cancer
Research Stamp Act.
In the 105th Congress, Representative Fazio and Representative Susan Molinari of
New York sponsored H.R. 1585, the Stamp Out Breast Cancer Act. The bill was agreed
to in the House on July 22, 1997, by a vote of 422 to 3, and by unanimous consent in the
Senate on July 24, 1997. The measure became law as P.L. 105-41 on August 13, 1997.
The Stamp Out Breast Cancer Act directed USPS to establish the special rate as the
first class rate plus a differential of up to 25%, with the exact amount to be decided by
USPS’s Board of Governors. It also directed USPS to issue the stamp within a year, to
deduct its “reasonable costs,” which would include costs “attributable to printing, sale,
and distribution” of the stamps, and to pay the remainder of the surcharge to two
designated federal agencies. Seventy percent was to go to the National Institutes of
Health (NIH), and the remainder to the Department of Defense (DOD).

2 For example, an “AIDS Awareness” 29-cent stamp was issued on Dec. 1, 1993; a “Breast
Cancer Awareness” 32-cent stamp was issued on June 15, 1996; and a “Prostate Cancer
Awareness” 33-cent stamp was issued on May 28, 1999. For a description of the USPS
commemorative stamp program, see CRS Report RS20221, Commemorative Postage Stamps:
History, Selection Criteria, and Revenue Potential, by Kevin R. Kosar.
3 Statement of criteria for commemorative stamp subject selection, issued by the Citizens’ Stamp
Advisory Committee, USPS, 1998.

The act limited sales of the breast cancer research semipostal (BCRS) to two years
from its initial issuance, and directed the Government Accountability Office (GAO) to
evaluate the program. GAO has since reported twice on the BCRS,4 and the Senate
Governmental Affairs Committee has held an oversight hearing to review it.5 GAO’s
evaluation was that the BCRS “has been an effective fund-raiser,” but GAO also said that
USPS did not have a good way of tracking its costs to avoid inadvertent subsidy from
postal ratepayers.
Revenue Raised and Postal Service Costs
As of December 31, 2007, according to USPS, over 785 million BCRSs had been
sold. The regular postage rate has been raised four times since the stamp was introduced
(from 32 to 41 cents), and its cost has gone from 40 to 55 cents. Overall, according to
USPS, $60.1 million has been transferred to NIH and DOD for breast cancer research.
NIH has used its money to support pilot studies in the prognosis, prevention, and
treatment of breast cancer. DOD has designated the money for awards in biology,
immunology, and genetics related to breast cancer.
In 2000, GAO and the USPS Office of Inspector General (USPSOIG) had some
differences with USPS over the amount USPS had charged for its “reasonable costs” to
be subtracted from the surcharge amount before the net surcharge was turned over to NIH
and DOD.6 Additionally, USPS decided to subtract less than 9% of the BCRS costs it did
identify from the surcharge proceeds before turning the rest over to NIH and DOD.
USPS’s reasoning was that it also stood to recoup most costs from the first-class postage
portion of the stamp, since some of the stamps would be retained by the public and not
used for postage. In this respect, the BCRS was similar to a “blockbuster”
commemorative issue, and “retained revenues” from such issues are a perennial
moneymaker for USPS.7
The Semipostal Authorization Act
The attention given to the breast cancer stamp, and GAO’s pronouncement that it
was a “success,” helped generate interest in other semipostals. Two public opinion
surveys commissioned by GAO, in 1999 and 2003, revealed that about 70% of the public

4 U.S. General Accounting Office, Breast Cancer Research Stamp: Millions Raised for Research,
but Better Cost Recovery Criteria Needed, GAO/GGD-00-80, Apr. 28, 2000; and Breast Cancer
Research Stamp: Effective Fund-Raiser, but Better Reporting and Cost-Recovery Criteria
Needed, GAO-03-1021, Sept. 30, 2003.
5 U.S. Congress, Subcommittee on International Security, Proliferation, and Federal Services,
Senate Committee on Governmental Affairs, The Issuance of Semipostal Stamps by the U.S.thnd
Postal Service, 106 Cong., 2 sess., S.Hrg. 106-674, May 25, 2000 (Washington: GPO, 2000).
6 U.S. Postal Service Office of Inspector General, Review of the Breast Cancer Research
Program, Report RG-AR-00-002 (Washington: USPSOIG, Mar. 31, 2000), pp. 3-4; and U.S.
General Accounting Office, Breast Cancer Research Stamp, pp. 9-10.
7 Retained revenues from commemoratives are discussed in CRS Report RS20221,
Commemorative Postage Stamps: History, Selection Criteria, and Revenue Potential, by Kevin
R. Kosar.

would like to see USPS issue more semipostals on a recurring basis.8 More than a dozen
bills were introduced in the 106th Congress to authorize the issuance of new semipostals.
They would have benefitted causes such as emergency food relief, AIDS research and
education, a World War II memorial, protection of vanishing wildlife, and child literacy.
A May 25, 2000, Senate hearing focused on GAO’s initial report and on legislative
proposals to extend the BCRS and to authorize other semipostals. A USPS witness,
Deborah Willhite, Senior Vice President for Government Relations and Public Policy,
made it clear that while USPS was proud of the work it did on the BCRS, it still did not
favor issuance of other semipostals. She testified that fund-raising was a diversion from
USPS’s core mission, that the philatelic community opposed semipostals on the grounds
that they dilute the quality of the stamp program, but most seriously that choosing among
the many worthy causes eager for semipostal revenue would be difficult for the Postal
Service.9 She said that if semipostals were authorized in the future, she hoped Congress
would make those choices. Congress chose another approach, however.
The Semipostal Authorization Act cleared the House as H.R. 4437 under suspension
of the rules on July 17, 2000, and the Senate by unanimous consent on July 26. The
President signed the bill into law (P.L.106-253; 114 Stat. 634) on July 28, 2000, the day
before the Stamp Out Breast Cancer Act was to expire. The act extended the BCRS for
two more years, until July 29, 2002, and gave USPS broad authority to issue and sell
semipostals for 10 more years “in order to advance such causes as the Postal Service
considers to be in the national public interest and appropriate.” Other than specifying that
the funds raised could go only to federal agencies, the act left broad discretion to USPS
in selecting future semipostals. The act also required USPS to use the notice-and-
comment regulatory process to propose and then issue a regulation specifying selection
criteria, procedures, and any limitations imposed on the issuance of semipostals.
Procedures and Criteria for Selecting Semipostal Stamps
On June 12, 2001, USPS published a regulation setting forth how it planned to
implement its responsibility for the semipostal program (66 F.R. 31822-31828). USPS
said it intended to invite nominations from the public for a new semipostal every two
years, with no more than one semipostal in circulation at any given time. The Citizens’
Stamp Advisory Committee10 would review the eligible proposals and make
recommendations to the postmaster general, who “will act on the recommendations” of
the committee. Submissions need to demonstrate that the cause to be benefitted “has
broad national appeal” and “is in the national public interest and furthers human welfare.”
Submissions must be accompanied by an official letter from an executive agency, or up
to two agencies, certifying that they are willing and able to implement the proposal and
adhere to the conditions set by the act. This requirement in particular suggested that
proposals need to be carefully planned and coordinated, and cannot merely be
suggestions, as is the case with nominations for commemorative postage stamps. On June

8 U.S. General Accounting Office, Breast Cancer Research Stamp, p. 23.
9 Senate Committee on Governmental Affairs, S.Hrg. 106-674, p. 14.
10 For more information on the committee, see CRS Report RS20221, Commemorative Postage
Stamps: History, Selection Criteria, and Revenue Potential, by Kevin R. Kosar.

12, 2001, USPS issued a notice of request for proposals for the next two semipostals (66
F.R. 31829). By the August 31, 2001, closing date, 37 valid nominations had been made
and accepted, nine of them with what USPS calls “congressional interest.” Most proposed
support for medical research and awareness, on such diseases as AIDS, asthma, autism,
colorectal cancer, stroke, deafness, Alzheimer’s disease, sickle cell anemia, diabetes,
lupus, and prostate cancer. Others focused on childhood abuse and neglect, pollination,
missing children, and vanishing wildlife. Former President Jimmy Carter proposed a
semipostal for Habitat for Humanity.
Congress Intervenes to Authorize More Semipostals
According to the semipostal stamp program implementing rules (39 C.F.R. Part 551),
USPS will not issue other semipostals under the Semipostal Authorization Act of 2000
until after the sales period of the BCRS has ended. The implementing regulations also
provide that the Office of Stamp Services will determine the date of commencement of
the 10-year period.
Congress, however, has enacted more semipostal stamp legislation. The Treasury-
Postal Service Appropriations Act for 2002 (P.L. 107-67) contained three provisions
affecting the issuance of semipostal stamps. One provision extended the BCRS
expiration date to December 31, 2003, and authorized raising the price of the stamp from
40 cents to 45 cents. A second provision authorized another semipostal, to be issued “as
soon as possible,” to assist the families of rescue workers killed or disabled in the terrorist
attacks of September 11, 2001. The Federal Emergency Management Agency (FEMA)
would administer the funds. USPS announced at a White House ceremony that the
“Heroes of 2001” stamp would be issued June 7, 2002, and terminate on December 31,
2004. A third provision authorized issuance of a semipostal to support programs of the
Department of Health and Human Services to stop domestic violence, beginning no later
than January 1, 2004, and being withdrawn no later than December 31, 2006. The “Stop
Family Violence” stamp went on sale October 11, 2003, at a price of 45 cents. This stamp
went off the market on December 31, 2006. Over 45 million of these semipostal stamps
were sold, raising about $3 million.
All three of these provisions exempted the stamps from the USPS regulation limiting
circulation of semipostals to one at any one time. It is unlikely that USPS would
authorize a semipostal under its statutory authority to compete with those authorized
directly by Congress, since USPS is well aware that the public could tire of semipostals,
as has happened in several other countries. Of the 170 countries that issue stamps, only
about 50 issued any semipostals in the 1990s, and only 17 did so on a regular basis. Even
fewer had more than one in circulation at a time. Canada, the United Kingdom, and
Sweden discontinued the use of semipostals when they became unpopular with the public
and competed with other fund-raising activities.11
There is some evidence that the public is losing interest in semipostals. Sales of the
BCRS peaked at 121.3 million stamps in FY2000. Sales declined to 83.0 million and

80.1 million in FY2003 and FY2004, rose to 92.6 million in FY2005, then fell to 67.3

11 John M. Hotchner, “Semipostals Should Give Back to the Hobby,” Linn’s Stamp News, May

10, 1999.

million and 65.2 million in FY2006 and FY2007.12 GAO reported the views of some
observers that the large initial sales figures of the “Heroes of 2001” semipostal “were not
sustainable because that semipostal did not benefit from the support of a long-established,
well-organized, nationwide network of organizations to keep the Heroes semipostal in the
public eye,” in contrast to the nationwide support base for the breast cancer stamp.13 In
the last three months of 2004, a period of seasonally heavy mailing, sales of the Heroes
semipostal averaged only 1.6 million per month, and sales of the domestic violence
semipostal averaged only 967,000. The Heroes stamp was withdrawn from sale when its
authorization expired on December 31, 2004. USPS had gradually transferred
$10,174,000 in net proceeds to FEMA by that date. On July 26, 2005, FEMA published
its plans to distribute the money (70 F.R. 43214). The application period for the
assistance program under the 9/11 Heroes Stamp Act of 2001 started on December 2,

2005, and ended on March 29, 2006.

Developments in the 108th, 109th, and 110th Congresses
In the 108th Congress, P.L. 108-199 contained a provision (Division F, Title V,
Section 541) amending 39 U.S.C. 414(h) to extend the BCRS until December 31, 2005.
Because the bill was not enacted until January 24, 2004, the BCRS was briefly withdrawn
from sale early in the year. The 109th Congress extended the BCRS until December 31,

2007 (P.L. 109-100; 119 Stat. 2170). The 110th Congress extended the BCRS further still,

permitting USPS to sell the stamps until December 31, 2011 (P.L. 110-150; 121 Stat.


On February 9, 2005, the House Committee on Government Reform amended its
Rule 19 to discourage the consideration of legislation to authorize new semipostals:
The committee has adopted the policy that the determination of the subject matter of
commemorative stamps and new semi-postal issues is properly for consideration by
the Postmaster General and that the committee will not give consideration to
legislative proposals specifying the subject matter of commemorative stamps and new
semi-postal issues. It is suggested that recommendations for the issuance of
commemorative stamps be submitted to the Postmaster General.
This rule, now numbered as Rule 20, was retained by the House Oversight and
Government Reform Committee in the 110th Congress.14

12 U.S. Government Accountability Office, U.S. Postal Service: Factors Affecting Fund-Raising
Stamp Sales Suggest Lessons Learned, GAO-05-953 (Washington: GAO, 2005), p. 13. USPS
provided data for FY2005 to FY2007 to CRS.
13 U.S. General Accounting Office, Breast Cancer Research Stamp, pp. 24-25.
14 See [].