**BEFORE THE**

**POSTAL RATE COMMISSION**

**WASHINGTON, DC 20268-0001**

  ----------------------------------- -----------------------------------
  **SPECIAL SERVICES REFORM, 1996**   **Docket No. MC96-3**

  ----------------------------------- -----------------------------------

**DOUGLAS F. CARLSON**

**INTERROGATORIES TO THE UNITED STATES POSTAL SERVICE**

**(DFC/USPS-1-6)**

**November 11, 1996**

Pursuant to section 25 of the [Rules of Practice]{.underline}, I,
Douglas F. Carlson, hereby submit interrogatories to the United States
Postal Service.

Respectfully submitted,

Dated: November 11, 1996
\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

> DOUGLAS F. CARLSON

**DFC/USPS-1**. Please confirm that the Postal Service stopped printing
postal cards in a single-color design after a former postmaster general
complained during the 1980\'s that the single-color postal cards were,
in his opinion, unattractive, and he suggested or directed that the
Postal Service, from that point on, produce only postal cards that were
more attractive than the single-color postal cards that he did not like.
If you do not confirm, please explain.

**DFC/USPS-2**.

\(a\) During the year 1985, the Postal Service produced two single-color
postal cards, Charles Carroll and George Wythe (both in the Patriot
series), and one multi-color postal card, Clipper Flying Cloud. Please
confirm that the per-unit manufacturing cost of producing these
single-color Patriot postal cards was less than the per-unit
manufacturing cost of producing the Clipper Flying Cloud postal card. If
you do not confirm, please explain fully.

\(b\) If, for any reason, you are not able to make the comparison
requested in (a), please select an appropriate period of time during
which both single-color and multi-color postal cards were produced and
then confirm that the per-unit manufacturing cost of producing the
single-color postal cards was less than the per-unit manufacturing cost
of producing the multi-color postal cards. If you cannot confirm, please
explain fully.

**DFC/USPS-3**.

\(a\) On September 9, 1996, the presiding officer asked Postal Service
witness Lyons whether the Postal Service has considered producing
single-color postal cards, since those cards might cost less to produce
than multi-color cards. Tr. 2/184-85. As of November 11, 1996, has the
Postal Service considered whether to develop a less-expensive postal
card?

\(b\) If the answer to (a) is yes, please explain the status of this
consideration.

\(c\) If the answer to (a) is no, please explain why the Postal Service
has not considered producing a less-expensive postal card.

**DFC/USPS-4**.

\(a\) Please confirm that all postal cards are manufactured by the
Government Printing Office.

\(b\) Please confirm that some postage stamps are produced by outside
contractors, rather than the Government Printing Office, because these
contractors can produce the stamps at a cost lower than the Government
Printing Office would charge. If you do not confirm, please explain
fully.

\(c\) Please confirm that the Government Printing Office purchased a
color press primarily or exclusively for produc­tion of multi-color
postal cards for the Postal Service. If you confirm, please provide the
year of purchase.

**DFC/USPS-5**. Subparts (a) and (b) request that the Postal Service
confirm a practice or event that has [actually]{.underline} happened,
not respond by discussing the proper procedure that [should]{.underline}
be followed.

\(a\) Please confirm that the Postal Service, at some time in the past
12 months, has, pursuant to a written or unwritten agreement,
understanding, or procedure, delivered to at least one private company,
individual, or government agency other than the Postal Service letters,
flats, or parcels with Form 3811, Domestic Return Receipt, still
attached and allowed the recipient, at a later time and not under the
visual supervision of a postal employee, to sign the Forms 3811,
indicate the date of receipt on the Forms 3811, and then deposit the
Forms 3811 in the mail.

\(b\) Please confirm that the Postal Service, at some time in the past
12 months, has, pursuant to a written or unwritten agreement,
understanding, or procedure, delivered to at least one private company,
individual, or government agency other than the Postal Service letters,
flats, or parcels with Form 3811, Domestic Return Receipt, still
attached and allowed the recipient, at a later time and not under the
visual supervision of a postal employee, to sign the Forms 3811,
indicate the date of receipt on the Forms 3811, and then return the
Forms 3811 to a Postal Service employee for that employee to review to
verify that the Forms 3811 were filled out accurately and completely.

\(c\) If you confirm neither (a) nor (b), please reconcile your answer
with Attachment 1 to DBP/USPS-T1-3. Your answer should explain why you
cannot confirm (a) or (b), given that the first and fourth bulleted
paragraphs of Attachment 1 to DBP/USPS-T1-3 suggest that the practices
described in (a) and/or (b) do, in fact, exist.

**DFC/USPS-6**. Please refer to Presiding Officer\'s Information Request
No. 4 (Question 8).

\(a\) Does the Postal Service agree with Witness Lyons\' response? If
the answer is anything other than an unqualified yes, please explain
fully.

\(b\) For this question, please assume the following: (1) The Postal
Service believes that some nonresident boxholders would be willing to
pay a higher fee for their box than the Postal Service presently charges
them; (2) the Postal Service\'s [only]{.underline} goal in proposing a
nonresident fee is to increase its total revenue by charging a fee to
nonresident boxholders that would be higher than the fee that presently
applies to nonresident boxholders. Does the Postal Service believe that
a boxholder who initially rejected a fee increase would subsequently
accept the fee increase if he understood that the fee increase were
motivated solely by the Postal Service\'s desire to increase its
revenues? If the answer is yes, please explain fully and cite any
studies on which the Postal Service relies in support of its answer.

\(c\) For this question, please assume the following: (1) The Postal
Service concludes that nonresident boxholders impose greater costs on
the Postal Service than resident boxholders; (2) the Postal Service\'s
only goal in proposing a nonresident fee is to recover the additional
costs that nonresident boxholders impose on the Postal Service; (3) the
nonresident boxholder to which the following sentence refers does not,
by any objective or subjective measure, impose costs on the Postal
Service greater than the average cost imposed by resident boxholders in
the post office in which the nonresident has his post-office box. Under
these three assumptions, does the Postal Service believe that a
nonresident boxholder who initially rejected a fee increase would
subsequently accept the fee increase if he were told that the
nonresident fee was being imposed to recover the additional costs that
nonresident boxholders impose on the Postal Service? If the answer is
yes, please explain fully and cite any studies on which the Postal
Service relies in support of its contention.

\(d\) The three assumptions in (c) apply to this question. Does the
Postal Service believe that a nonresident boxholder who initially
rejected a fee increase would subsequently accept the fee increase if he
were told that (1) the nonresident fee was designed to recover the
additional costs that nonresident boxholders impose on the Postal
Service and (2) no studies were conducted to measure and compare the
costs that resident and nonresident boxholders impose on the Postal
Service? If the answer is yes, please explain fully and cite any studies
on which the Postal Service relies in support of its contention.

**CERTIFICATE OF SERVICE**

I hereby certify that I have this day served the foregoing document upon
the required participants of record in accordance with section 12 of the
[Rules of Practice]{.underline} and sections 3(B)(3) and 3(C) of the
[Special Rules of Practice]{.underline}.

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

DOUGLAS F. CARLSON

November 11, 1996

Emeryville, California