Operating under the Postal Act, the Postal Service notified the Postal Regulatory Commission (PRC) of modifications in pricing and classification of products and services, established mailing and shipping services contracts for domestic and international mail, and submitted reports, documents, rulemakings, and studies as required. This section summarizes the most significant changes, which can be viewed in detail at www.prc.gov. For some cases, the docket name is followed by a more descriptive designation.
R2009-2 Notice of Price Adjustment
Planned Rate Adjustments and Classification Changes for Market Dominant Postal Products
On February 10, the Postal Service filed its Notice of Market Dominant Price Adjustment. The adjustment took effect on May 11, and affected all the market dominant classes of mail. For this annual price change, the overall inflation-based price adjustment authority was 3.8 percent.
The price adjustment included several different key components. In First-Class Mail, a 2-cent increase (to 44 cents) on the first-ounce price for letters was tempered by holding the additional-ounce price and the nonmachinable surcharge at existing levels. The Postal Service proposal included Full-Service Intelligent Mail prices for certain price categories of letters and flats of First–Class Mail, Standard Mail, Periodicals, and Bound Printed Matter to be implemented in November 2009.
Additional Standard Mail price adjustments included a Saturation Mail Incentive. In Periodicals and Package Services, the focus was on improving the overall efficiency and cost coverage of the respective products in those two classes. Finally, in Special Services, fee increases were generally designed to be close to the cap percentage, while maintaining consistency with historical rounding constraints that often simplify transactions for customers.
R2009-3 Notice of Price Adjustment
Standard Mail Volume Incentive Pricing Program (“Summer Sale”)
The Postal Service implemented a temporary price reduction on incremental volume for Standard Mail from July 1 through September 30 to promote volume growth during the typically low-volume summer months in which there is excess processing capacity and to counteract the dramatic volume reduction due to the economy. This initiative was the first of its kind. The pricing incentive provided a 30 percent rebate on Standard Mail letters and flats above a customer-specific threshold for qualifying customers.
R2009-4 Notice of Price Adjustment for Standard Mail High Density Flats
On June 1, the Postal Service filed a Notice of Price Adjustment to decrease the minimum-per-piece prices for commercial and nonprofit High Density flats by 0.1 cent, and to decrease the per-pound price element. The Postal Service determined that it would be more appropriate to mitigate the High Density flats prices that were implemented May 11, based on concerns from Standard Mail High Density flats mailers that above-average price increases would have a detrimental impact on their businesses. This price change went into effect July 19.
R2009-5 Notice of Price Adjustment for Certain Presorted First-Class Mail
First-Class Mail Incentive Program
Similar in design to the Summer Sale, the Postal Service also initiated a First-Class Mail Incentive Program, aimed at growing presorted First-Class Mail volume between October 1, 2009 and December 31, 2009. The incentive will provide a 20 percent rebate on incremental volume of certain presorted letters, flats, and cards sent by qualifying customers above a predetermined threshold.
CP2009-8 Competitive Products Price Changes; Rates of General Applicability
On November 13, 2008, the Postal Service gave notice of the establishment by the Governors of changes in prices of general applicability for competitive products, including Express Mail, Priority Mail, Parcel Select, Parcel Return Service, Global Express Guaranteed, Express Mail International, Priority Mail International, and International Direct Sacks — M-Bags, effective January 18.
CP2009-23 Competitive Products Price Changes; Rates of General Applicability
On February 10, the Postal Service announced a price adjustment for several shipping services — Parcel Select, Premium Forwarding Service, International Priority Airmail (IPA), International Surface Air Lift (ISAL), and International Ancillary Services. The changes for Parcel Select, IPA, and ISAL also included the addition of new pricing tiers to provide incentives for mailer preparation that reduces postal costs. The adjustment took effect May 11, to coincide with related changes to mailing services.
CP2009-27 Competitive Products Price Changes; Rates of General Applicability
Inadvertent Omission of Price Change for Pickup on Demand Service
On April 9, the Postal Service filed a notice of errata in regard to the May 11 prices announced for Pickup on Demand for Express Mail, Priority Mail, and certain international competitive products. The price change for Pickup on Demand had been inadvertently omitted in the filing for the May 11 price adjustments.
Competitive Product Contracts – Domestic and International
CP2009-1 through CP2009-7, CP2009-9 through CP2009-22, CP2009-24 through CP2009-26, CP2009-28 through CP2009-66
The Postal Service submitted several contracts for domestic mail services: two for Express Mail, 18 for Priority Mail, five for Express Mail/Priority Mail, and one for Parcel Select/Parcel Return Service. The Postal Service also submitted several contracts for international services: 15 for Express Mail International/Priority Mail International, four for Global Direct for international delivery of letter items with the destination country’s postal indicia, two for Global Plus 1 and Global Plus 2 offering volume-based discounts for a variety of outbound international services, two for International Business Reply Service, and one for Direct Entry Parcels for international delivery of packages with the destination country’s postal indicia. Finally, the Postal Service submitted a number of rates and agreements with foreign postal administrations: inbound rates for Express Mail Service from 190 countries, two Inbound Direct Entry contracts, an agreement for inbound air parcels, and an agreement for surface parcels.
MT2009-1 Market Test of Experimental Product – Collaborative Logistics
The Postal Service endeavors to optimize its complex transportation network serving its processing facilities. Nevertheless, the natural imbalance of mail volume between cities and the need to meet operating plans that support service standards makes some underutilized space on highway transportation predictable. On May 7, the Postal Service began selling that available space to transport nonpostal articles on pallets on a space-available basis and deliver them to large customers and/or postal facilities.
RM2008-1 Regulations to Establish Procedure for According Appropriate Confidentiality
On August 13, the PRC initiated a rulemaking to establish regulations implementing its authority to determine the degree of confidentiality and/or third-party access to accord to information provided by the Postal Service to the PRC in furtherance of its regulatory responsibilities. In September and October 2008, the PRC received initial and reply comments from the Postal Service and other interested parties. The PRC solicited a second round of comments and reply comments in April and May 2009. On June 19, the PRC issued final rules that took effect July 29.
RM2008-3 Rules for Complaints
On March 24, the PRC issued rules for complaints and rate or service inquiries. These rules establish a bifurcated framework for investigating and considering formal complaints alleging violations of law, on one hand, and more localized rate and service inquiries on the other.
RM2008-4 Periodic Reporting Rules
Proposed Rulemaking Prescribing Form and Content of Periodic Reports
This rulemaking, initiated August 22, 2008, was to develop rules covering both the information submitted by the Postal Service as part of its Annual Compliance Report every December, and periodically throughout the year on other matters. As well as specifying the content of the required reports, the proposed rules established procedures by which the analytic methodologies used to develop those reports can be addressed and, if necessary, amended. After the submission of initial and reply comments by interested parties, the PRC adopted final rules on April 16, which substantially (but not entirely) in accord with the proposed rules.
RM2008-5 Accounting Practices and Tax Rules for Competitive Products.
This rulemaking, initiated September 11, 2008, allowed the PRC to prescribe rules applicable to competitive products for the establishment and application of the accounting practices and principles to be followed by the Postal Service, and the substantive and procedural rules for determining the assumed Federal Income Tax on competitive products income. The PRC issued final rules December 18, 2008.
RM2009-1, RM2009-2 Modification of Costing Methods 2008
Periodic Reporting Proposals Twelve and Thirteen
These two rulemakings, initiated in November 2008, provided informal rulemaking proceedings similar to Docket Nos. RM2008-2 and RM2008-6, in which the Postal Service proposed additional changes to the costing methods for the 2008 Annual Compliance Report. The PRC accepted most of these proposals.
RM2009-5, RM2009-7, and RM2009-10 Modification of Analytic Principles Used in Periodic Reporting
Periodic Reporting Proposals One Through Thirteen
These rulemakings, initiated in June, July, and September, provide informal rulemaking proceedings to consider proposed changes to the methodologies used to estimate costs, volumes, and revenues for preparing the 2009 Annual Compliance Report. In these dockets, the Postal Service is seeking approval of 19 methodology changes, and has responded to a number of related Information Requests. The cases are still active.
RM2009-8 Amendment to the System of Ratemaking Regulations
Proposed Rulemaking to Amend the Cap Calculation
This was a minor rulemaking to extend the precision to which the annual price cap is calculated from one to three decimal places. The proposed rule was initiated on July 10 and adopted on September 22.
RM2009-9 Allocation of Assets and Liabilities to Competitive Products Enterprise
This rulemaking, initiated on August 24, follows up on several minor issues about financial accounting practices and tax rules remaining from closely related Docket No. RM2008-5. The case is still active.
RM2009-11 Periodic Reporting of Service Performance Measurements and Customer Satisfaction
On September 2, the PRC issued a notice of proposed rulemaking to establish rules for reporting service performance and customer satisfaction achievements for market dominant products. The case is still active.
RM2009-12 Regulations Establishing Procedures for Obtaining Information from the Postal Service
On September 2, the PRC issued a notice of proposed rulemaking for the procedures by which the PRC will exercise its subpoena authority. Among other things, the proposed rules would allow the PRC to require the Postal Service, its contractors, or its agents to produce information, under penalty of a court sanction, on the PRC’s own accord or at the request of another party. The case is still active.
C2008-3 Complaint of Capital One Services, Inc.
Capital One Services, Inc., filed a Complaint on June 19, 2008, alleging that the Postal Service unduly discriminated against Capital One by not offering it an identical contract as the Bank of America contract. On May 21, Capital One filed a Motion to Withdraw its Complaint, as a result of settlement with the Postal Service. The Presiding Officer granted that motion and closed the docket on June 2.
C2009-1 Complaint of GameFly, Inc.
GameFly, Inc., filed a Complaint on April 23, asserting several claims of unreasonable discrimination and other undue preferences allowed by the Postal Service in violation of the law. GameFly alleged that the Postal Service extended preferential services and inequitable rates to certain high-volume rival mailers who similarly use First-Class Mail to send and receive DVDs. The case is still active.
PI2009-1 Report to Congress and the President on Universal Postal Service and the Postal Monopoly
On December 19, 2008, the PRC sent to Congress and the President a Report on Universal Postal Service and the Postal Monopoly as required by the Postal Act of 2006. The report represents over eight months of review and analysis of information, comments, and testimony submitted in Docket No. PI2008-31 by many interested parties including the Postal Service, other federal agencies, representatives of Postal Service employee unions and postmaster associations, users of the mail, and mail service providers.
The report presented the history and development of universal service and the postal monopolies, the current legal scope of the universal service obligation, the postal letter and mailbox monopolies, and the scopes and standards of universal service and postal monopolies likely to be required in the future.
The report recommended no immediate changes in universal service, the universal service obligation, the letter monopoly, or the mailbox monopoly. The report recognized that the Postal Service faces many challenges from technological and social trends and volume declines caused by the economic downturn. The report offered recommendations identifying areas where additional information would assist decision makers if future action becomes necessary.
N2009-1 Station and Branch Optimization and Consolidation Initiative
On July 2, the Postal Service filed a request for an advisory opinion regarding a plan to optimize the retail network in urban and suburban areas by consolidating the operation of retail stations and branches in close proximity to one another. No facility-specific consolidations are anticipated to be implemented before the end of calendar year 2009. An advisory opinion from the PRC is expected in early calendar year 2010.
A2009-1 Hacker Valley Post Office, Hacker Valley, WV 26222 (Retha Casto, Petitioner)
The PRC chose to docket this matter as an appeal of a Post Office discontinuance, thereby failing to follow its usual practice of first verifying the procedural stance of the matter. Operations had been suspended, not formally discontinued, a situation the PRC would normally handle by advising the attempted petitioner that an appeal was premature. In Order No. 319, the PRC denied the Postal Service motion to dismiss proceedings, promised to examine more closely the relationship between suspension and discontinuance and, without formal notice to that effect, closed the docket. Subsequently, via Order No. 335, the PRC opened a public inquiry docket, PI2010–1, requesting public comment on Postal Service suspension and discontinuance of Post Offices.
MC2008-1 (Phase II), MC2009-19, and MC2009-20 Review of Nonpostal Services and Modification of Mail Classification Schedule Product Lists
These three proceedings all involve further steps to address services that, under the 1970 Postal Reorganization Act, were treated as nonpostal services. Under the new criteria of the Postal Act of 2006, some have been reclassified as postal services. Current efforts are focused on laying an appropriate foundation for future regulation of these products. All three cases are still active.
