The free-franking privilege, allowing delegates of the Continental Congress to send mail free of charge, was first extended on November 8, 1775. This was almost seven months before the signing of the Declaration of Independence. Through subsequent enactments the privilege was expanded to include a large number of government officials. The system was open to abuse, as there was no way to distinguish between official and personal mail. Philip Ward noted that by 1869 some 31,933 people enjoyed franking privileges, which cost the Post Office Department approximately $5 million a year.
In an effort by the Grant administration to stem the tide of postal abuse, stamps were issued in 1873 for the nine departments of the Executive branch. They include the Agriculture, Executive, Interior, Justice, Navy, Post Office, State, Treasury and War Departments. Stamps were issued to the various departments by the Post Office as needed, and an accounting was kept for budgeting purposes and for reimbursement of the Post Office Department.
In an article by Morrison Waud in the Feb. 1975 Chronicle, he quotes Third Asst. Postmaster General W. H. H. Terrell’s report to Postmaster General A.J. Creswell: "The abolition of the franking privilege, to take effect July 1, 1873, renders it necessary that stamps, somewhat different in appearance from the ordinary adhesive postage stamps now in public use, should be adopted... we consulted with the officers of the "Continental" and were gratified to find them ready and willing to meet our wishes to the fullest extent. Within two or three days they submitted new designs for all of the Departments embracing the eleven denominations now in use..."
Four new, large-size bicolor stamps were added for the State Department, in $2, $5, $10 and $20 denominations, all bearing William H. Seward’s portrait. It has been surmised that these higher values were prepared for use on consular mail, which was often sent out in large parcels and would have been charged a high postage rate.
In 1875 a set of Officials was released as part of the Special Printings program. These were overprinted "Specimen", because, unlike the regular-issue Special Printings, the Officials were not valid for postage. Like the 1875 Bank Note Special Printings, most of the Official Special Printings were scissors-separated, often cutting into the design. The Zoellner collection contains a complete set of imperforate Official Special Printings (lot 894), many with the imprint or plate number showing in selvage.
In December 1878 Continental merged with American Bank Note Company, who assumed production for United States stamps early in 1879, including the Officials. As with the regular Bank Note issues, the Officials printed by American can be distinguished by the use of soft, porous paper. There is, however, an intermediate paper used by Continental just before American took over, and these should not be confused with the American printings.
American Bank Note Co. printed stamps only as the available Continental supply became depleted. The American printings were few in number, because, for the most part, existing supplies of Continental stamps were sufficient to meet demand.
On July 5, 1884, the Official stamps became obsolete with the universal adoption of the Official Penalty envelope.