[Federal Register Volume 83, Number 110 (Thursday, June 7, 2018)]
[Proposed Rules]
[Pages 26392-26396]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-12200]


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POSTAL REGULATORY COMMISSION

39 CFR Part 3050

[Docket No. RM2018-5; Order No. 4630]


Periodic Reporting

AGENCY: Postal Regulatory Commission.

ACTION: Notice of proposed rulemaking.

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SUMMARY: The Commission is noticing a recent filing requesting that the 
Commission initiate an informal rulemaking proceeding to consider 
changes to an analytical method for use in periodic reporting (Proposal 
Two). This document informs the public of the filing, invites public 
comment, and takes other administrative steps.

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DATES: Comments are due: July 16, 2018.

ADDRESSES: Submit comments electronically via the Commission's Filing 
Online system at http://www.prc.gov. Those who cannot submit comments 
electronically should contact the person identified in the FOR FURTHER 
INFORMATION CONTACT section by telephone for advice on filing 
alternatives.

FOR FURTHER INFORMATION CONTACT: David A. Trissell, General Counsel, at 
202-789-6820.

SUPPLEMENTARY INFORMATION:

Table of Contents

I. Introduction
II. Proposal Two
III. Notice and Comment
IV. Ordering Paragraphs

I. Introduction

    On May 25, 2018, 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.\1\ The Petition identifies the proposed analytical 
changes filed in this docket as Proposal Two.
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    \1\ Petition of the United States Postal Service for the 
Initiation of a Proceeding to Consider Proposed Changes in 
Analytical Principles (Proposal Two), May 25, 2018 (Petition).
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II. Proposal Two

    Background. Proposal Two relates to new sampling and weighting 
procedures for the city carrier portion of the In-Office Cost System 
(IOCS).\2\ The current IOCS design uses a multi-stage probability 
sample to randomly select city carriers, then an interval of work time 
from the city carrier's tour, resulting in an observation (``reading'') 
that represents a ``snapshot'' of work activity in a sampled 
interval.\3\ Under the current IOCS design, data collection for city 
carriers is widely dispersed in both time and location, so the Postal 
Service conducts most city carrier readings by telephone. The Postal 
Service states that the availability of detailed clock ring data from 
the Time and Attendance Collection System (TACS) and Delivery 
Operations Information System (DOIS) data now allows for a change to 
the current IOCS sampling design for city carriers. Id. at 1-2.
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    \2\ Petition at 1. The IOCS ``is a continuous, ongoing 
probability sample of work time to estimate costs of various 
activities performed by clerks, mail handlers, city carriers, and 
supervisors.'' See Docket No. ACR2017, Library Reference USPS-FY17-
37, file ``USPS-FY17-37.Preface.pdf,'' at 2.
    \3\ Petition, Proposal Two at 1. The Postal Service currently 
uses cost estimates from the IOCS to develop total accrued costs for 
both city carrier in-office and street time. Id.
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    Proposal. The Postal Service proposes to change the current IOCS 
sample design for city carriers to a cluster sampling approach that 
would include using TACS workhours to weight the sampling data. Id. at 
3-4. In the morning, on-site clustered city carrier readings would be 
conducted by an IOCS data collector, rather than with telephone 
respondents in sampled delivery zones.\4\ In zones with six or more 
routes (sampling mode 1), a maximum of six carriers would be randomly 
selected to represent the zone and morning readings would be taken on-
site by the IOCS data collector once every 30 minutes.\5\ In zones with 
fewer than six city carriers working the selected zone (sampling mode 
2), morning readings would be taken on-site by the IOCS data collector 
on all carriers once every 15 minutes.\6\ In the afternoon (sampling 
mode 3), all city carrier readings would be conducted by telephone and 
clustered into one-hour intervals.\7\
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    \4\ Id. at 2, 4. ``Zone is defined by both ZIP Code and finance 
number.'' Id. at 4 n.5.
    \5\ Id. at 5. All morning readings would begin when carriers 
start their workday and would continue until 11 a.m. Id. at 6.
    \6\ The Postal Service plans to synchronize IOCS-Cluster 
readings with City Carrier Cost System (CCCS) tests when a data 
collector is already scheduled to be at a delivery unit.
    \7\ All afternoon readings would be conducted between 11:00 and 
19:00 hours. Id. at 6.
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    Under the cluster sampling design, the Postal Service proposes to 
use TACS workhours to weight sampling data by zone, and to provide cost 
controls for city carriers by time-of-day (morning and afternoon) and 
day-of-week group (weekday/Saturday group and Sunday/Holiday group). 
Id. at 4-5. Additionally, the Postal Service states that it will use 
DOIS and TACS data for the sampled zone to weight the readings for each 
test relative to other tests within the same Cost Ascertainment Group 
(CAG) strata, and to post-stratify readings by route group and city 
carrier craft group. Id. at 4, 7. However, the Postal Service states 
that all afternoon readings are scaled to the total hours in the 
afternoon and not estimated by CAG separately because it asserts that 
``there are insufficient afternoon tallies'' and ``no significant 
difference [for in-office cost] is expected'' because carriers would be 
on the street. Id. at 7.
    The Postal Service asserts that the proposal adopts the approach 
suggested by the Commission in Order No. 4399 for developing route 
group weighting factors when there were ``empty cells'' within the 
combination of route group and carrier group. Id. at 12.
    Proposal Two would also ``[u]se TACS data to provide control totals 
for the portion of supervisor costs incurred by employees whose base 
craft is carrier, but who have clocked as supervisor.'' Id. at 4. 
Additionally, unlike the current IOCS methodology, under the Proposal 
Two methodology, no IOCS readings would be conducted on Sundays and 
Holidays.\8\ However, for purposes of evaluating and presenting the 
estimated impact on FY 2017 costs, the Postal Service ``shows the 
effects of attributing all Sunday/Holiday costs'' to Parcel Select. Id. 
at 9.
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    \8\ Id. at 5. Instead, the Postal Service states that it will 
develop control total costs for Sunday/Holiday from TACS hours and 
distribute costs using scanning data from Product Tracking and 
Reporting (PTR). Id. at 5, 9. The Postal Service explains that it 
intends to file a separate proposal outlining the use of the PTR 
data for Sunday/Holiday costs. Id. at 5.
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    Rationale and impact. The Postal Service states that the primary 
objective of Proposal Two is to replace telephone readings with on-site 
readings, particularly while carriers are on the premises and handling 
mail. Id. at 10.
    The Postal Service projects that the IOCS-Cluster system will 
obtain twice as much on-premises data as the current system, but ``due 
to the improvement in sampling efficiency, will not require additional 
data collection resources.'' Id. at 8. Further, the Postal Service 
asserts that ``[t]he new design improves data quality by obtaining far 
more data from on-site rather than telephone readings, while 
simultaneously improving data collection efficiency.'' Id. at 1.
    The Postal Service lists several benefits of the proposal including 
the ability to scan barcodes, providing feedback at the time of the 
reading for less-common products and assisting with ``back-end 
processing of tallies.'' Id. at 10. Additionally, the Postal Service 
states that on-site data collectors may do a better job than a 
telephone respondent of recognizing some of the mailpiece markings that 
are less common and more obscure. Id. Further, unlike city carrier 
telephone respondents, under Proposal Two, on-site IOCS data collectors 
would not have other duties that may affect and constrain participating 
in a reading under the current IOCS sampling system. Id.
    The Postal Service states that the proposal will result in a 
significant increase in the percentage of direct tallies where the 
carrier is handling the mailpiece, and decreases in tallies for support 
and administrative activities, training, and mixed mail. Id. at 12. The 
Postal Service also anticipates a

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significant increase in tallies in the parking area, potentially making 
it possible to distribute mixed mail tallies separately from in-
facility. Id. at 13.
    The Postal Service states that the pilot data indicate some 
significant shifts in product costs, including a decrease in costs for 
First-Class letters, and increases in costs for a number of products 
including parcel-shaped products, carrier route bundled products, 
Periodicals, and International Mail. Id. at 14-15. The Postal Service 
asserts that the shifts in product costs are most likely due to the use 
of on-site data collectors rather than telephone respondents. Id. at 
15. The proposal would also impact costs associated with supervising 
city carriers.\9\
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    \9\ Id. at 14. The pilot data showed a 9.1-percent increase in 
supervisor city carrier costs, which resulted in a slight increase 
in piggyback factors on city carrier costs. Id.
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    The Postal Service's estimate of the effect on product unit costs 
is presented in Table 5 of Proposal Two, which is reproduced here. Id. 
at 16.
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[GRAPHIC] [TIFF OMITTED] TP07JN18.004

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III. Notice and Comment

    The Commission establishes Docket No. RM2018-5 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 Proposal Two no later 
than July 16, 2018. Pursuant to 39 U.S.C. 505, Lyudmila Y. 
Bzhilyanskaya 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. RM2018-5 for consideration 
of the matters raised by the Petition of the

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United States Postal Service for the Initiation of a Proceeding to 
Consider Proposed Changes in Analytical Principles (Proposal Two), 
filed May 25, 2018.
    2. Comments by interested persons in this proceeding are due no 
later than July 16, 2018.
    3. Pursuant to 39 U.S.C. 505, the Commission appoints Lyudmila Y. 
Bzhilyanskaya 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 publication of this order in the 
Federal Register.


    By the Commission.
Ruth Ann Abrams,
Acting Secretary.
[FR Doc. 2018-12200 Filed 6-6-18; 8:45 am]
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