[Federal Register Volume 84, Number 137 (Wednesday, July 17, 2019)]
[Proposed Rules]
[Pages 34082-34083]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-15128]


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POSTAL REGULATORY COMMISSION

39 CFR Part 3050

[Docket No. RM2019-7; Order No. 5146]


Periodic Reporting

AGENCY: Postal Regulatory Commission.

ACTION: Notice of proposed rulemaking.

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SUMMARY: The Commission is acknowledging a recent filing requesting the 
Commission initiate a rulemaking proceeding to consider changes to 
analytical principles relating to periodic reports (Proposal Two). This 
document informs the public of the filing, invites public comment, and 
takes other administrative steps.

DATES: Comments are due: August 12, 2019.

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 July 9, 2019, 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), July 9, 2019 (Petition). The 
Postal Service filed a non-public library reference with Proposal 
Two. Library Reference USPS-RM2019-7/NP1, Nonpublic Material 
Relating to Proposal Two, July 9, 2019; Notice of Filing of USPS-
RM2019-7/NP1 and Application for Nonpublic Treatment, July 9, 2019.

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[[Page 34083]]

II. Proposal Two

    Background. In Docket No. RM2018-8, the Commission approved the 
Postal Service's methodology to distribute dispatch format revenue it 
receives from inbound LC/AO mail based whether the mailpiece was a 
letter, flat, or small packet/bulky letter.\2\ However, the Commission 
noted that it was possible to refine the Postal Service's methodology 
to distribute inbound LC/AO revenue and that ``distributing dispatch 
format revenue to item formats based on the revenue per piece and 
revenue per pound for those mail flows where terminal dues are 
calculated on a per-item and per-kilogram basis [is] worthy of further 
evaluation.'' Order No. 4827 at 18. Although the Postal Service 
incorporated such a revenue distribution methodology in its Fiscal Year 
(FY) 2018 Annual Compliance Report (ACR), the Postal Service asserts 
that there was ``no prior opportunity . . . to seek Commission review 
of the new procedure incorporated into the ACR.'' Petition, Proposal 
Two at 2. In the FY 2018 Annual Compliance Determination, the 
Commission accepted the Postal Service's revenue distribution for 
inbound LC/AO mail for purposes of the compliance review, but directed 
the Postal Service to ``file a petition for the initiation of a 
proceeding to consider this proposed change in analytical 
principles[.]'' \3\
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    \2\ See generally Docket No. RM2018-8, Order On Analytical 
Principles Used in Periodic Reporting (Proposal Five), September 21, 
2018 (Order No. 4827). ``LC/AO'' is an abbreviation for ``lettres et 
cartes'' and ``autres objets,'' and is French for ``letters and 
cards'' and ``other objects.'' LC/AO refers to international 
letters, cards, flats, bulky letters, and small packets, whether 
under the Universal Postal Union (UPU) terminal dues system or 
bilateral or multilateral agreements. Inbound LC/AO contrasts with 
Inbound Letter Post, which refers to the Postal Service product 
consisting of letters, cards, flats, bulky letters, and small 
packets received under the terminal dues system. See Mail 
Classification Schedule (MCS), section 1130.
    \3\ Docket No. ACR2018, Annual Compliance Determination Report, 
April 12, 2019, at 81.
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    Proposal. The Postal Service's proposal seeks to revise the revenue 
distribution methodology for inbound LC/AO mailpieces. Currently, the 
Postal Service distributes inbound LC/AO revenue based on weight 
proportions by shape in the dispatch data. Petition, Proposal Two at 3. 
Proposal Two would distribute dispatch format revenue to item formats 
based upon the revenue per piece and the revenue per pound for those 
items where remuneration is based on a per-item and per-kilogram basis. 
Id. at 2-3.
    Rationale and impact. The Postal Service states that Proposal Two 
will apply more detailed piece and weight data to distribute inbound 
LC/AO revenue. Id. at 3. The Postal Service notes that Proposal Two 
requests review of the methodology it used to distribute inbound LC/AO 
revenue in its FY 2018 ACR, which was described in its response to 
Chairman's Information Request No. 1. Id. at 2-3.
    The impact of Proposal Two is that revenue for inbound small 
packets and bulky letters decreases as revenue for inbound letters and 
flats increases. Id. at 3. The Postal Service states that this result 
is expected as the previous revenue distribution method, based solely 
on weight, would allocate more revenue towards the heavier weighted 
small packets and bulky letters. Id.

III. Notice and Comment

    The Commission establishes Docket No. RM2019-7 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 August 12, 2019. Pursuant to 39 U.S.C. 505, Katalin K. Clendenin 
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. RM2019-7 for consideration 
of the matters raised by the Petition of the United States Postal 
Service for the Initiation of a Proceeding to Consider Proposed Changes 
in Analytical Principles (Proposal Two), filed July 9, 2019.
    2. Comments by interested persons in this proceeding are due no 
later than August 12, 2019.
    3. Pursuant to 39 U.S.C. 505, the Commission appoints Katalin K. 
Clendenin 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. 2019-15128 Filed 7-16-19; 8:45 am]
 BILLING CODE 7710-FW-P