Periodic Reporting

SUPPLEMENTARY INFORMATION:

Table of Contents

I. Introduction

II. Proposal

III. Notice and Comment

IV. Ordering Paragraphs

I. Introduction

On October 22, 2024, the Postal Service filed a petition pursuant to 39 CFR 3050.11 requesting that the Commission initiate a rulemaking proceeding to consider changes to analytical principles relating to periodic reports. The Petition identifies the proposed analytical changes filed in this docket as modifications to the mail processing cost model for Parcel Select and Parcel Return Service. Petition, Proposal at 1.

II. Proposal

Background. The Postal Service states that, in Order No. 6536, the Commission approved structural changes designed to simplify the Parcel Select price structure. See id. at 1, n.3. The Postal Service further states that, in Order No. 6798, the Commission approved conforming changes to the Parcel Select and Parcel Return Service (PRS) mail processing and transportation cost models. See id. at 2, n.4. The Postal Service notes that in Fiscal Year (FY) 2024, the Commission approved several Negotiated Service Agreements (NSAs) that include a provision for DHub-entered packages, whose supporting workpapers “utilized the DSCF-SCF mail processing cost as a proxy for the DHub non-presort cost[.]” See id. at 2. The Postal Service states that in its requests it declared the intention to propose a DHub non-presort mail flow model and corresponding mail processing cost for Commission review. Id.

Proposal. For purposes of reporting costs for NSAs under which “the customer will be able to enter machinable non-presorted DHub packages at specific designated Sorting & Delivery Centers (S&DCs) that contain parcel sorting equipment[,]” the Postal Service proposes that the Parcel Select and PRS mail processing cost model be modified to “include a non-presort machinable mail flow (DHub) and corresponding mail processing cost estimates for DHub-entered packages.” See id. at 2-3. This new flow and corresponding cost estimate would be in addition to existing flows and cost estimates for 5-digit presorted DHub-entered packages and non-presorted DSCF-entered packages. See id.

The Postal Service filed under seal the proposed modified mail processing cost model with the Petition. Id. at 3. The proposed cost model includes DHub cost estimates for non-presort machinable Parcel Select Heavy Weight (PSHW) and non-presort machinable Parcel Select Light Weight (PSLW) mailpieces. Id. The corresponding new mail flow includes “differing hub container movement costs and additional sortation” and has “only pallet container unloading costs, as well as additional costs for parcel machine processing and manual processing” along with “[c]osts for the loading and unloading of Postal Service hampers of sorted parcels[.]” Id. The new mail flow uses the same delivery unit cost for secondary parcel sortation as the existing 5-digit presorted DHub mail flow. Id. A second, similar new mail flow is included in the proposed cost model for DHub non-presort PSLW which uses delivery unit costs specific to PSLW. See id.

Impact. The Postal Service emphasizes that existing mail processing unit costs are, in general, not impacted by the Proposal, which instead introduces two new cost estimates. Id. at 4. The Postal Service notes that adoption of the Proposal would not have had any effect on FY 2023 costs at the Cost and Revenue Analysis (CRA) level, and that the approved NSAs that include a provision for DHub-entered packages had no such volume in FY 2024. Id.

III. Notice and Comment

The Commission establishes Docket No. RM2025-2 for consideration of matters raised by the Petition. More information on the Petition may be accessed via the Commission's website at http://www.prc.gov. Interested persons may submit comments on the Petition and the Proposal no later than November 27, 2024. Pursuant to 39 U.S.C. 505, Arif Hafiz is designated as an officer of the Commission (Public Representative) to represent the interests of the general public in this proceeding.

IV. Ordering Paragraphs

It is ordered:

1. The Commission establishes Docket No. RM2025-2 for consideration of the matters raised by the Petition of the United States Postal Service to Initiate a Proceeding to Change Analytical Principles and Notice of Filing Non-Public Materials, filed October 22, 2024.

2. Comments by interested persons in this proceeding are due no later than November 27, 2024.

3. Pursuant to 39 U.S.C. 505, the Commission appoints Arif Hafiz to serve as an officer of the Commission (Public Representative) to represent the interests of the general public in this docket.

4. The Secretary shall arrange for the publication of this order in the Federal Register .

[FR Doc. 2024-25401 Filed 10-31-24; 8:45 am]

BILLING CODE 7710-FW-P