chapter 1
compliance with statutory policies
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RM2003-5, in which it proposed specialized procedures to consider Postal Service requests for rate and classification changes based on NSAs. Many of the PRC's proposals arose out of procedural and other issues encountered in Docket No. MC2002-2 (see item D.2). Participants in this rulemaking have filed comments on the proposed rules.

11. Update on Other Initiatives

     As part of an ongoing review of ecommerce and other new services, the Postal Service has made several changes to the nonpostal initiatives identified in the report on Nonpostal Initiatives filed with the Postal Rate Commission on March 10, 2003. The initiatives in which there have been major changes are listed below:

a. Mail Package Shipment Program

     This program, known as the "All Malls Valet Shipping Program," was a limited pilot test of a variation of free centralized collection service in shopping malls. This program had been discontinued due to limited use during the experiment. It has now been terminated.

b. LibertyCash

     This initiative involved consideration of a stored value card for use in purchasing postage and related products. The Postal Service has terminated this initiative.

c. USPS eBillPay

     USPS eBillPay enables customers to receive, view and pay their bills electronically via the Postal Service Web site. From inception, this service was largely operated by CheckFree Corporation, with the Postal Service retaining a role relating to marketing, promotion and customer service activities. The Postal Service has decided that it will not renew the contract with CheckFree upon its expiration in April 2004, and has so informed CheckFree.

d. USPS Send Money

     USPS Send Money is a service feature available to customers wanting to send money to anyone with a transfer between bank accounts. Since this is provided as a feature under the agreement with CheckFree, it will also no longer be offered by the Postal Service after April 2004.

e. USPS Pay@Delivery™

      This feature allows customers to combine USPS Send Money with the Postal Service's Delivery Confirmation service offering. Since this is provided as a feature under the agreement with CheckFree, it will also no longer be offered by the Postal Service after April 2004.

E. Transportation Policies

1. General

     The Postal Service spent $4.6 billion in 2003 for the contractual transportation of mail. This represents a $42 million decrease from 2002 transportation expenses compared to increases of 1.3 percent and 7.4 percent respectively for the previous two years. After the terrorist attacks on September 11, 2001, the Federal Aviation Authority (FAA) placed restrictions on larger mailpieces which prohibited the Postal Service from using commercial air carriers. The Postal Service was forced to move virtually all Priority Mail items to the FedEx and surface networks. During 2003 the consolidation of routes and improved efficiencies in air transportation resulted in an overall decrease in total transportation costs.

2. Domestic Transportation

a. Air Transportation

     Air transportation costs in 2003 totaled $1.8 billion, a decrease of 3.4 percent over the prior year. These costs include the use of commercial airlines (passenger and freight) and dedicated networks. The Postal Service contracted to move more than 2.4 billion pounds of domestic mail last year. As a result of the September 11, 2001, attacks, the

Chapter 1
Compliance with Statutory Policies Introduction
  1. Fundamental Service to the People
  2. The Workforce
  3. Service to Small or Rural Communities
  4. Postal Cost Apportionment and Postal Ratemaking Developments
  5. Transportation Policies
  6. Postal Service Facilities, Equipment, and Supplies
Chapter 2 Postal Operations

Chapter 3 Financial Highlights

Chapter 4 2003 Performance Report and Preliminary 2005 Annual Performance Plan