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Wed, 11/30/2022 - 12:00

##   PRC Issues Advisory Opinion on USPS Proposal to Change Critical Entry Times for Certain Periodical Categories

**Washington, DC** – Today the Postal Regulatory Commission released its advisory opinion on a Postal Service plan to revise the critical entry times (CETs) for some categories of Periodicals mail. The CET is the latest time a mailpiece may be tendered to the Postal Service and still have the day count when measuring that mail’s service performance. (Docket No. N2022-2). Specifically, the Postal Service proposes to standardize four of the five Periodicals CETs (i.e., CETs for all non-palletized Periodicals mail). Instead of the current CET range of 0800-1400 for the affected categories of Periodicals mail, the Postal Service proposes that all of those categories would share a CET of 0800. The Postal Service asserts that this change would “promote simplification of mail processing operations, and hence more effective allocation and use of processing personnel and equipment.”

The Commission’s evaluation of the Postal Service’s proposal finds:
                              - The proposed changes will likely enable the Postal Service to project more easily and accurately the Periodicals volumes and, therefore, will likely improve Periodicals processing. Nevertheless, the Commission questions the necessity of the changes related to workload planning, given that reasonably accurate daily volume projections are possible without these changes.   
                              - The proposed changes are likely to result in more efficient use of the Postal Service’s equipment, particularly its bundle/package sortation machines. The Postal Service uses many employees and considerable staff time to reconfigure these machines for processing bundles and packages, and under current practices, some of the machines must be held in reserve to process later-arriving Periodicals. The proposed changes should mitigate these issues and create cost savings. However, the Commission notes that the cost savings due to this particular issue may be limited because two of the three CETs being changed apply to Periodicals for which the mailer has already completed the bundle sortation as part of the Postal Service’s worksharing program.   
                              - A subset of affected Periodicals mailers have indicated that they will not be able to achieve the revised CETs and are likely to have an additional service day added to the delivery of their mailpieces. Periodicals industry representatives indicate that the Postal Service’s proposal will have a significant impact on the costs and production schedules for this subset of the industry.   
                              - The Postal Service has not analyzed how the expected impact on Periodicals mailers would affect Periodicals volumes, worksharing, or the recipients of Periodicals mail.

Based on its findings, the Commission provides the Postal Service with recommendations to take into consideration before implementing its plan to change the CETs for certain Periodical categories. The Postal Service should:
                              - Continue to evaluate whether the proposed changes are necessary to achieve more effective workload planning.
                              - Balance several competing factors — on one side, the multiplicity of CETs is contributing to the inability of the Postal Service to move the mail as efficiently as it should, which is impacting service performance. On the other side, the Postal Service needs to continue to work diligently with the impacted groups on efforts to ameliorate any negative financial or service impacts of the new CETs.
                              - Monitor implementation of the proposed changes to ensure that increased bundle/package sortation equipment capacity is utilized as planned. Specifically, the Postal Service should evaluate whether the expected spillover efficiencies for other flats and parcel processing are realized. If these anticipated benefits are not realized, the Postal Service should consider further steps, such as purchasing additional equipment, to minimize service failures associated with equipment capacity.
                              - Acknowledge that the revised CETs will likely add an additional service day for a portion of the affected Periodicals mailers.
                              - Monitor and add sufficient Facility Access and Shipment Tracking (FAST) appointments to respond to shifts in mailer behavior and work with mailers to ensure that mailers are not hindered in tendering their mail. FAST is a Postal initiative designed to help mailers present mail to the Postal Service in a more efficient manner by using appointments and reducing wait times at Postal Service docks.
                              - Develop more granular data around tender times and consider how to mitigate the impacts of the proposed changes on the particularly vulnerable segments of Periodicals mailers.
                              - Analyze potential behavioral changes for Periodicals mailers and the potential impact of those changes on the expected net financial benefits and efficiency gains.

The Postal Service is required to request an advisory opinion from the Commission prior to implementing a change in the nature of postal services that will generally affect service on a nationwide or substantially nationwide basis. (39 U.S.C. § 3661(b).) The Commission’s advisory opinion is nonbinding, and the Commission does not have the authority to enforce its advice regarding the Postal Service’s proposed changes to the CETs of the affected Periodicals.  

The Commission’s full Advisory Opinion may be found on the homepage of its website: www.prc.gov. 

*The Postal Regulatory Commission is an independent federal agency that provides regulatory oversight over the Postal Service to ensure the transparency and accountability of the Postal Service and foster a vital and efficient universal mail system. The Commission is comprised of five Presidentially-appointed and Senate-confirmed Commissioners, each serving terms of six years. The President designates the Chairman. In addition to Chairman Michael Kubayanda, the other commissioners are Vice Chairman Ann Fisher and Commissioners Mark Acton, Ashley Poling, and Robert Taub. Follow the PRC on Twitter: @PostalRegulator and LinkedIn.*

N2022-2 Press 11.30.22_0.doc(89 KB)
                            -         PRC Fiscal Year 2024 Budget Justification    

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**Media Contact**Gail Adams202.789.6829**gail.adams@prc.gov**

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