[Federal Register Volume 85, Number 120 (Monday, June 22, 2020)]
[Proposed Rules]
[Pages 37403-37405]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-13188]
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POSTAL REGULATORY COMMISSION
39 CFR part 3050
[Docket No. RM2020-10; Order No. 5548]
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 Three).
This document informs the public of the filing, invites public comment,
and takes other administrative steps.
DATES: Comments are due: August 14, 2020.
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 Three
III. Notice and Comment
IV. Ordering Paragraphs
I. Introduction
On June 11, 2020, 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 Three.
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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 Three), June 11, 2020 (Petition).
The Postal Service also filed a notice of filing of public and non-
public materials relating to Proposal Three. Notice of Filing of
USPS-RM2020-10-1 and USPS-RM2020-10-NP1 and Application for
Nonpublic Treatment, June 11, 2020.
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II. Proposal Three
Background. The Postal Service's current In-Office Cost System
(IOCS) design uses a multi-stage probability sample to randomly select
craft employees, including city carriers, and then an interval of work
time from the employee's tour for a ``snapshot'' of work activities in
the work interval. Petition, Proposal Three at 1. The Postal Service
states that moving data collectors to distant delivery units for
carrier readings is costly so that in FY 2019, of over 250,000
individual readings scheduled on city carriers, over 85 percent were
conducted by telephone. Id. The Postal Service asserts that the
availability of detailed clock ring data from the Time and Attendance
Collection System (TACS) allows reshaping of the sampling design to
improve sampling efficiency and data quality. Id. The Postal Service
explains that In Docket No. RM2019-6, the Commission approved the
modelling of all Special Purpose Route (SPR) carrier costs using TACS
data and econometric equations.\2\
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\2\ Id. at 1-2. Docket No. RM2019-6, Order on Analytical
Principles Used in Periodic Reporting (Proposal One), January 14,
2020 (Order No. 5405).
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Proposal. The Postal Service states that Proposal Three would
change IOCS system design for city carriers to a cluster sampling
utilizing census data from TACS to enable on-site data collection at
locations and times where and when city carriers are working on the
premises. Petition, Proposal Three at 3. Rather than sampling
individual employees, the proposed design would sample blocks of time
and then subsample clusters of carriers working during those blocks of
time. Id. The Postal Service asserts that this new design improves data
quality with more on-site data rather than telephone readings and,
thereby, improves data collection efficiency. Id. at 1.
[[Page 37404]]
The Postal Service states that for in-morning tests (prior to
1100), when carriers typically work on the premises of postal
facilities, on-site data collection of the associated carriers using
clustered on-site readings in sampled individual finance numbers
(within cost ascertainment group (CAG) strata) would be used as
described in the Proposal as Sampling Mode 1. Id. at 3. In the
afternoon period (after 1100), when carriers are typically working on
the street, clustered telephone readings with one-hour intervals of
time would be sampled as described in the Proposal as Sampling Mode 2.
Id.
The Postal Service states that TACS data would be used to control
totals for supervisor costs incurred on weekdays by employees whose
base craft is carrier but clocked in as a supervisor craft. Id. at 4.
The Postal Service asserts that this method was approved by the
Commission in Order No. 5395 for Sundays and holidays.\3\ The Postal
Service states that it will not conduct carrier readings on Sundays and
holidays, but would expand the methodology to all days of the week. Id.
It would use TACS data to provide control totals for carrier costs on
Sundays and holidays described in Docket No. RM2018-5.\4\
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\3\ Id. at 4 n.4. See Docket No. RM2019-12, Order on Analytical
Principles Used in Periodic Reporting (Proposal Seven), January 6,
2020 (Order No. 5395).
\4\ Petition, Proposal Three at 4. See Docket No. RM2018-5,
Order Approving In Part Proposal Two, January 8, 2019 (Order No.
4972).
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Each of the Sampling Modes is described briefly in the Proposal.
Sampling Mode 1 is Morning On-site Tests. Petition, Proposal Three at
3. The Postal Service states that all carriers working in the selected
finance number are identified and software is used to randomly
subsample up to six carriers. Id. at 4-5. Typically a reading is
conducted on each of the six carriers every 30 minutes from the start
of their workday until 1100. Id. at 5. Sampling Mode 2 is Afternoon
Telephone Tests. Id. Telephone tests are scheduled for one-hour blocks
of time between 1100 and 1900. Id. Software randomly selects 30
carriers across a district and groups them by finance numbers. Id.
There are larger CAG groups and smaller CAG groups to allow for
oversampling of smaller CAGs. Id. The Postal Service states that a full
description of the sampling modes is provided in Appendix A as part of
Library Reference USPS-RM2020-10-1. Id. at 4.
The Postal Service states that the sampling methodology utilizes
probability proportional to size (PPS) sampling ``based on the accrued
TACS workhours for carriers from two pay periods out of the prior
quarter.'' Id. at 6. TACS workhours are grouped by CAG finance number,
district and time of day and samples are on a quarterly basis. Id.
Table 1 of the Proposal presents the Mode 1 quarterly sample size by
CAG Group. Id. Table 2 shows the Mode 2 quarterly sample size by CAG
Group. Id. at 7. Table 3 of the Proposal displays the proposed number
of tests by each Sampling Mode and CAG Group and the proposed number of
``non-stop'' readings (when a carrier is actively working in the tested
finance number) expected from each mode. Id. at 8. The Postal Service
would estimate costs for carriers using quarterly TACS data to weight
the IOCS-Cluster sample readings. Id. The Postal Service states that
equations for the estimations are provided in Appendix A of Library
Reference USPS-RM2020-10-1. Id.
The Postal Service states that with the approval of Proposal One in
Docket No. RM2019-6, tallies are no longer used to distribute SPR
activity costs. Id. at 9. It states that the current proposal will
continue to sample SPR carriers, but will not use the readings to
attribute any costs. Id. The Postal Service states that the change in
sampling methods does not change the activity or mail-related questions
of the data collectors; only administrative fields and back-end
variables will be affected by the sampling methodology. Id.
Rationale. The Postal Service states that there are numerous
reasons it views the cost estimates from the new sampling systems as
more accurate than the cost estimates from the current IOCS sampling
system. Id. at 10. It offers the following reasons. Dedicated on-site
data collectors can provide valuable information and validate data. Id.
They are trained and may better implement IOCS data collection
procedures with a primary objective to complete their tests compared to
the current data collecting employees who also have other
responsibilities. Id. On-site data collectors will have time for
increased sampling with less disruption and delay of carriers and
respondent clerks and supervisors. Id. at 10-11.
Based on Table 4 of the Proposal, the Postal Service asserts that
direct mailpiece costs using the allocation of direct mailpiece tallies
when carriers were in the office increased 44 percent, and increased
223 percent when carriers were in the parking lot. Id. at 10. It also
asserts that in-office mixed mail costs decreased 24 percent and that
parking lot mixed mail costs decreased 9 percent. Id. at 10-11.
The Postal Service asserts that there will be a reduction in
ambiguous route costs. Id. at 12. No costs except certain training
costs will be allocated to unidentified routes; whereas, in Non-Cluster
IOCS, numerous tallies are assigned to the ambiguous route 99 when
carriers are not assigned to a specific route or not working on a valid
route. Id. The Postal Service asserts Table 6 of the Proposal
demonstrates that larger route categories appear stable between the two
systems. Id. at 13.
As its last rationale, the Postal Service states that use of the
TACS system to weight tests by finance number or district means that
the Postal Service no longer needs to absorb the inefficiency of simple
random sampling. TACS allows sampling at all CAGs, and weights the
results according to accrued hours and costs. Id.
Impact. The Postal Service asserts that Table 7 of the Proposal
demonstrates that the proposed IOCS-Cluster sampling would result in a
49 percent increase in costs allocated based on direct tallies, where
the carrier was handling a mailpiece and the mailpiece was able to be
sampled. Id. at 13-14. It also asserts that costs decreased for mixed
mail, training, support and administrative activities, all readings
without an actual mailpiece. Id.
The impacts at the Cost and Revenue Analysis (CRA) product level
are indicated in Table 8 of the Proposal. Id. at 15. The Postal Service
states that the material cost changes are seen in competitive products
which increased overall, that First-Class Mail Single-Piece Letter
costs decreased, accounting for most of the decrease in First-Class
Mail, and that costs of other market dominant products increased. Id.
at 14. Competitive product details were filed under seal in Library
Reference USPS-RM2020-10-NP-1. Id.
The Postal Service provides the results of the coefficients of
variation (CVs) by CRA Subproducts in Table 9 of the Proposal. Id. at
16-17. The Postal Service asserts that, using Quarter 2 FY 2020 data,
the majority of CVs projected for IOCS-Cluster were lower than during
FY 2019. Id. at 16. The Postal Service also asserts that the efficiency
gains for street time outweigh the slight increase in CVs. Id. It
claims that First-Class Mail experiences a slight increase in CVs due
to a drop in allocated costs, but that the approval of modeling SPR
costs in Docket No. RM2018-5 improved the CVs compared to the previous
IOCS-Cluster filing. Id.
III. Notice and Comment
The Commission establishes Docket No. RM2020-10 for consideration
of matters raised by the Petition. More information on the Petition may
be accessed via the Commission's website
[[Page 37405]]
at http://www.prc.gov. Interested persons may submit comments on the
Petition and Proposal Three no later than August 14, 2020. 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. RM2020-10 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 Three), filed June
11, 2020.
2. Comments by interested persons in this proceeding are due no
later than August 14, 2020.\5\
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\5\ The Commission reminds interested persons that its revised
and reorganized Rules of Practice and Procedure became effective
April 20, 2020, and should be used in filings with the Commission
after April 20, 2020. The new rules are available on the
Commission's website and can be found in Order No. 5407. Docket No.
RM2019-13, Order Reorganizing Commission Regulations and Amending
Rules of Practice, January 16, 2020 (Order No. 5407).
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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.
Erica A. Barker,
Secretary.
[FR Doc. 2020-13188 Filed 6-19-20; 8:45 am]
BILLING CODE 7710-FW-P