[Federal Register Volume 76, Number 238 (Monday, December 12, 2011)]
[Notices]
[Pages 77271-77273]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-31814]


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POSTAL REGULATORY COMMISSION

[Docket No. CP2012-2; Order No. 997]


Competitive Product Postal Price Changes

AGENCY: Postal Regulatory Commission.

ACTION: Notice.

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SUMMARY: The Commission is noticing a recently-filed Postal Service 
request for a change in competitive products prices. The changes will 
take effect January 22, 2012. This notice addresses procedural steps 
associated with this filing.

ADDRESSES: Submit comments electronically by accessing the ``Filing 
Online'' link in the banner at the top of the Commission's Web site 
(http://www.prc.gov) or by directly accessing the Commission's Filing 
Online system at https://www.prc.gov/prc-pages/filing-online/login.aspx. Commenters who cannot submit their views electronically 
should contact the person identified in the FOR FURTHER INFORMATION 
CONTACT section as the source for case-related information for advice 
on alternatives to electronic filing.

FOR FURTHER INFORMATION CONTACT: Stephen L. Sharfman, General Counsel, 
at (202) 789-6820 (case-related information) or [email protected] 
(electronic filing assistance).

SUPPLEMENTARY INFORMATION: On November 22, 2011, the Postal Service 
filed notice with the Commission concerning changes in rates of general 
applicability for competitive products.\1\ The Filing also includes 
related mail classification changes. The Postal Service represents 
that, as required by the Commission's rules, 39 CFR 3015.2(b), the 
Filing includes an explanation and justification for the changes, the 
effective date, and a schedule of the changed rates. The price

[[Page 77272]]

changes are scheduled to become effective January 22, 2012.
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    \1\ Notice of the United States Postal Service of Changes in 
Rates of General Applicability for Competitive Products Established 
in Governors' Decision No. 11-8, November 22, 2011 (Filing). The 
Filing is available on the Commission's Web site, www.prc.gov. 
Pursuant to 39 U.S.C. 3632(b)(2), the Postal Service is obligated to 
publish the Governors' Decision and record of proceedings in the 
Federal Register at least 30 days before the effective date of the 
new rates or classes.
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    Attached to the Filing is the Governors' Decision evaluating the 
new prices and classification changes in accordance with 39 U.S.C. 
3632-33 and 39 CFR 3015.2. The Governors' Decision provides an analysis 
of the competitive products' price and classification changes intended 
to demonstrate that the changes comply with section 3633(a) of title 39 
and the Commission's rules. See 39 CFR 3015.7(c).
    The attachment to the Governors' Decision sets forth the price 
changes and includes a draft Mail Classification Schedule (MCS) for 
competitive products of general applicability. Selected highlights of 
the price and classification changes follow.
    Express Mail. Overall, Express Mail prices increase by 3.3 percent. 
Retail prices increase, on average, by 4.4 percent. The existing 
structure of the price categories for zoned Retail, Commercial Base and 
Commercial Price categories does not change. The Commercial Base 
category, which offers lower prices to Customers who use online or 
other authorized postage payment methods, decreases by 5.0 percent. 
Commercial Plus prices, overall, receive a zero percent increase, but 
some individual prices will increase and some will decrease. A new 
Express Mail Flat Rate Box product is added and is priced the same 
across all channels ($39.95).
    Priority Mail. Priority Mail prices increase by 3.1 percent 
overall, with average retail prices increasing by about 3.2 percent. 
Price increase varies by rate cell and price tier. Flat Rate Box prices 
are small ($5.35), Medium ($11.35), Large ($15.45) and Large APO/FPO/
DPO ($13.45).
    The existing structure of Retail, Commercial Base and Commercial 
Price categories does not change. The average increase for Commercial 
Base prices is 3.0 percent. Commercial Plus prices increase by 2.8 
percent. The price category will continue to contain Critical Mail 
letters and flats, a half pound price, an assortment of Flat Rate 
packaging, and Commercial Plus Cubic pricing.
    Changes to the price structure include the following: (1) Adding a 
larger-sized Regional Rate box tier; \2\ (2) the parcel volume 
threshold in Commercial Price Cubic pricing is reduced from 250,000 to 
150,000 pieces, and can use soft packaging; and (3) Open and Distribute 
pricing for specified trays and flat tubs is to be introduced in 
January.
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    \2\ If deposited at retail a $0.75 fee will be added.
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    Parcel Select. Parcel Select service increases, on average, by 8.5 
percent. For destination entry parcels, the average price increases 7.6 
percent for dropshipping at destination delivery units (DDU), 7.8 
percent for parcels entered at a destination plant (DSCF), and 6.8 
percent for parcels entered at a destination Network Distribution 
Center (NDC).
    For nondestination-entered parcels, the average increases are 1.5 
percent for origin NDC presort, 0.9 percent for NDC presort, and 0.8 
percent for nonpresort. The barcode discount is eliminated. Lightweight 
Parcel Select (formerly Standard Mail commercial parcels) increase by 
8.9 percent. The maximum dimensions for Regional Ground increase to 
accommodate any machinable parcel in this price category. In January, 
the Intelligent Mail Package Barcode (IMpb) feature is added for free 
visibility.
    Parcel Return. Parcel Return Service increases, on average, by 4.6 
percent. Return NDC prices retrieved at a return NDC will increase by 0 
percent, and the price for parcels picked up at a return delivery unit 
(RDU) will increase by 8.9 percent. The Postal Service's return product 
offerings will be branded as ``Return Service''.
    Commercial First-Class Package Service. Commercial First-Class 
parcels, recently transferred to the competitive product list, are 
renamed Commercial First-Class Package Service. Commercial First-Class 
Package Service prices increase, overall, 3.7 percent, with no 
structural changes.
    Domestic Extra Services. Premium Forwarding Service prices increase 
3.4 percent. The weekly reshipment fee increases to $15.25. On average, 
Address Enhancement Service prices increase 7.3 percent. On January 
2012, 6,800 Post Office Box locations join the existing 49 locations on 
the competitive product list. Additional fee ranges are added for boxes 
in Fee Groups 2 through 7. A Package Intercept service is introduced 
within the Competitive Ancillary Services product, priced at $10.95.
    Global Express Guaranteed and Express Mail International. Global 
Express Guaranteed service increases, on average, by 6.0 percent. 
Express Mail International (EMI) service increases, on average, by 11.6 
percent.
    For both GXG and EMI, classification changes include changes to 
published discounts: rate cell-specific discounted schedules for both 
GXG and EMI replace across-the-board discounts for customers using 
approved postage payment methods. Commercial base discount schedules 
replace across the board discounts for eligible shipments using 
selected payment methods. Customers tendering at least $100,000 in 
revenue per year for GXG, EMI and Priority Mail International (PMI) can 
request authorization for new commercial plus discounts.
    Two versions of a new Express Mail International Flat Rate Box 
product are added: for Canada ($59.95) and for all other countries 
accepting EMI ($74.95), both with a maximum weight of 20 pounds.
    Classification changes also include A) country group assignments 
for the nation of Tonga, and B) changes to the dimensional limits for 
EMI.
    Priority Mail International. Overall, Priority Mail International 
(PMI) prices increase by 8.7 percent. Classification changes include 
the simplification of dimensional criteria for flat rate envelopes and 
boxes, changes to the dimensional limits for PMI and the introduction 
of commercial base and commercial plus discounts similar to the changes 
for GXG and EMI.
    International Priority Airmail. International Priority Airmail has 
a price increase of 1.0 percent.
    International Surface Air Lift. International Surface Air Lift has 
a price increase of 13.7 percent.
    Airmail M-Bags. The published prices for Airmail M-Bags increase by 
3.5 percent.
    International Ancillary Services. The overall increase for 
international ancillary services is 5.0 percent. Money Order prices 
increase by 4.7 percent.
    Details of these changes may be found in the attachment to 
Governors' Decision No. 11-18.
    The Filing also includes three additional attachments: a redacted 
table that shows FY 2012 projected volumes, revenues, attributable 
costs, contribution, and cost coverage for each product, assuming 
implementation of new prices on January 22, 2012, a similar table 
assuming a hypothetical implementation on October 3, 2011 (for 
comparative purposes only), and an application for non-public treatment 
of the unredacted version of that table. The table calculates and 
identifies a contribution from competitive products as a percentage 
(7.9%) of institutional cost associated with the January 22, 2012 
implementation.
    Notice. The establishment of rates of general applicability for 
competitive products and the associated MCS changes effect a change in 
the draft MCS. Pursuant to subpart E of part 3020 of its rules, 39 CFR 
3020.90 et seq., the Commission provides notice of the Postal Service's 
Filing. Interested persons may express views and offer

[[Page 77273]]

comments on whether the planned changes are consistent with the 
policies of 39 U.S.C. 3632, 3633, or 3642 and 39 CFR part 3015 and 39 
CFR 3020, subpart B. Comments are due no later than December 12, 2011.
    Pursuant to 39 U.S.C. 505, Natalie R. Ward is appointed as Public 
Representative to represent the interests of the general public in the 
above-captioned docket.
    Supplemental information. Pursuant to 39 CFR 3015.6, the Postal 
Service is requested to provide a written response to the questions 
below. To assist in the completion of the record, answers should be 
provided as soon as possible, but by no later than December 5, 2011.
    1. Please refer to the redacted tables attached to the Filing, 
which present Competitive Product Contribution & Cost Coverage 
Analysis'' for FY 2012 ``January 22, 2011 Implementation'' and 
``October 3, 2011 Implementation.''
    a. Provide FY 2012 volumes, revenues, attributable costs, 
contribution, and cost coverage data similar to that provided in Docket 
No. CP2011-26 to support all data in both the redacted and unredacted 
tables.\3\
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    \3\ See, e.g., Docket No. CP2011-26, Notice of the United States 
Postal Service of Filing Supplemental Information Under Seal in 
Response to Commission Order No. 575, November 12, 2010; 
Supplemental Information Provided by the United States Postal 
Service in Response to Commission Order No. 575, Question 2 and 
Notice of Filing Material Under Seal, November 16, 2010.
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    b. Provide a narrative explaining the method used to forecast data 
in the referenced tables.
    c. Provide attributable costs, revenues, and volumes data for each 
product grouped in ``Competitive International (including Services)'' 
at the same level of detail provided for all other competitive products 
in this docket. For each of these international products, explain how 
the expected revenues and costs comply with 39 U.S.C. 3633(a).
    d. Please explain how the price adjustments for Parcel Select are 
consistent with 3633(a) and Docket No. MC2011-22, Order No. 689.\4\
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    \4\ Docket No. MC2011-22, Order Conditionally Granting Request 
to Transfer Commercial Standard Mail Parcels to the Competitive 
Product List, March 2, 2011 (Order No. 689).
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    2. Please refer to Governors' Decision No. 11-8. The Postal Service 
provides overall price increases for the following products: Express 
Mail 3.3 percent, Priority Mail 3.1 percent, Parcel Select 8.5 percent, 
Parcel Return Service 4.6 percent, First-Class Package Services 3.7 
percent, Premium Forwarding Service 3.4 percent, Address Enhancement 
Service 7.3 percent, Global Express Guaranteed 6.0 percent, Express 
Mail International 11.6 percent, Priority Mail International 8.7 
percent, International Priority Airmail 1.0 percent, International 
Surface Airlift 13.7 percent, Airmail M-Bags 3.5 percent, International 
Ancillary Services 5.0 percent, and international money orders 4.7 
percent. Please describe the weights used to derive the Before Rates 
and After Rates indices relied upon to calculate the overall (average) 
percentage price increase for each product and service referenced above 
similar to the supplemental data filed in Docket No. CP2011-26. ld. 
Please show all calculations in Excel, and explain any adjustments made 
due to classification changes.
    3. Please provide the specific prices assigned to the competitive 
Semi-Annual Fees for each Box Size and Fee Group. (Attachment at 141.)
    4. The following refers to Note 3 at 142. Please clarify what is 
meant regarding the portion of the fee that ``may serve as postage on 
packages delivered to competitive Post Office box service customers 
after being brought to the Post Office by a private carrier.''
    It is ordered:
    1. The Commission establishes Docket No. CP2012-2 to provide 
interested persons an opportunity to express views and offer comments 
on whether the planned changes are consistent with the policies of 39 
U.S.C. 3632, 3633, or 3642 and 39 CFR part 3015 and 39 CFR 3020, 
subpart B.
    2. Comments on the Filing are due no later than December 12, 2011.
    3. The Commission appoints Natalie R. Ward as Public Representative 
to represent the interests of the general public in this proceeding.
    4. The Postal Service shall provide a written response to the 
supplemental information requested in this order no later than December 
5, 2011.
    5. The Secretary shall arrange for publication of this order in the 
Federal Register.

    By the Commission.
Ruth Ann Abrams,
Acting Secretary.
[FR Doc. 2011-31814 Filed 12-9-11; 8:45 am]
BILLING CODE 7710-FW-P