[Federal Register Volume 62, Number 151 (Wednesday, August 6, 1997)]
[Notices]
[Pages 42270-42272]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-20628]


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POSTAL RATE COMMISSION

[Docket No. MC97-5; Order No. 1188]


Notice and Order on Filing of Request for Establishment of a 
Provisional Classification and Fee Schedule for Packaging Service

Issued July 31, 1997.
Before Commissioners: Edward J. Gleiman, Chairman; H. Edward Quick, 
Jr., Vice Chairman; George W. Haley; W.H. ``Trey'' LeBlanc III

    Notice is hereby given that on July 29, 1997, the United States 
Postal Service filed a request with the Postal Rate Commission pursuant 
to 3623 of the Postal Reorganization Act, 39 U.S.C. 101 et seq., for a 
recommended decision on proposed additions to the Domestic Mail 
Classification Schedule (DMCS). The request also includes proposed new 
fees. The request includes attachments and is supported by the 
testimony of three witnesses and seven library references. It is on 
file in the Commission Docket Room and is available for inspection 
during the Commission's regular business hours.

Provisional Character of the Proposed Classifications and Fees

    The Postal Service indicates that it is requesting new 
classifications and fees in order to introduce a packaging service on a 
provisional basis. The Service proposes that the packaging service be 
offered for a period not to exceed two years, unless it submits an

[[Page 42271]]

interim request for establishment as a permanent mail classification, 
in which case the provisional service could be offered for one 
additional year.

Description of Request

    The Postal Service proposes creation of a separate special service 
for packaging service, which ``would enable the Postal Service to offer 
customers the option of having items professionally packaged and staged 
for dispatch by the Postal Service.'' Request at 1. Packaging service 
would be available for ``mailable articles deemed suitable by the 
Postal Service for packaging[,]'' <SUP>1</SUP> and which are to be sent 
as Express Mail, Letters and Sealed Parcels, Priority Mail, or Parcel 
Post. While in effect, the provisional packaging service would be 
offered on a nationwide basis ``at postal retail outlets where demand 
would be sufficient to justify investment in training and inventory.'' 
Ibid.
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    \1\ Proposed DMCS Sec. 17.020, Sec. 953.21. In Attachment A to 
its Request, the Postal Service includes two alternative sets of 
proposed DMCS provisions: one corresponding to the numbering 
convention currently in effect for the schedules of special 
services, and the other in accordance with a new numbering system it 
has proposed in the pending omnibus rate proceeding, Docket No. R97-
1.
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    Fees for the packaging service would vary according to required 
carton size, the fragility of the item(s) to be packaged, and whether 
special packaging techniques are deemed necessary. The proposed fees 
range from $ 8.50 for a small, nonbreakable item to $ 22.50 for a large 
item requiring a special packaging technique.<SUP>2</SUP>
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    \2\ Should the Commission decide to recommend the proposed 
provisional packaging service, it may recommend the fees proposed by 
the Postal Service or a different set of fees, depending upon its 
assessment of record evidence in light of the policies and factors 
prescribed by the Postal Reorganization Act.
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    According to the Postal Service, provision of the proposed service 
would build upon its prior experience in testing Pack & Send service, 
which was the subject of Docket No. C96-1, a complaint 
proceeding.<SUP>3</SUP> However, the Service states that the packaging 
service it proposes in this docket differs from its predecessor in 
several respects. First, the proposed service would be offered only in 
conjunction with existing mail services, not as a stand-alone service. 
Second, fees for the proposed service and the special packaging 
techniques that may be required have been refined and simplified into 
three groupings based on the surface area of the required carton. 
Third, the service would be offered at selected postal retail outlets 
on a nationwide basis, rather than in a few markets. Finally, various 
components of the retail operation in which items are packaged for 
mailing would be automated.
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    \3\ In Docket No. C96-1, the Commission's inquiry focused 
exclusively on whether the subject Pack & Send service was 
``postal'' or ``non-postal'' in character, in order to determine 
whether it was being offered in contravention of the procedural 
requirements of chapter 36 of title 39, United States Code. The 
Commission did not assess the merits of the Pack & Send service in 
light of substantive statutory policies and factors. See Order No. 
1145, December 16, 1996; Order No. 1156, February 3, 1997.
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Expedited Consideration of the Request

    The Postal Service's request invokes the operation of subpart J of 
the Commission's rules of practice and procedure, 39 CFR 3001.171 
through 3001.176, which provide for expedited consideration of requests 
for provisional service changes of limited duration. The purpose of 
these expedited procedures, as stated in 39 CFR 3001.174, ``is to allow 
for consideration of proposed provisional services within 90 days, 
consistent with the procedural due process rights of interested 
persons.''
    According to the Service, the requested classification is suitable 
for consideration under the provisional service rules because it would 
create a separate special service, ancillary to the carriage of mail 
and available on a strictly optional basis, that would broaden the 
array of services available to mailers while recovering its costs and 
making a contribution to institutional costs. Thus, the Postal Service 
states, the proposed service would ``supplement, but will not alter, 
existing classifications and rates[,]'' as specified in 39 CFR 
3001.171(a). The Postal Service also claims that adoption of packaging 
service on a provisional basis would be consistent with the 
Commission's policy of recommending ``the introduction of provisional 
services that enhance the range of postal services available to the 
public, without producing a material adverse effect overall on postal 
revenues or costs, and without causing unnecessary or unreasonable harm 
to competitors of the Postal Service.'' Ibid.
    In a separate notice dated July 29, 1997, a copy of which was filed 
with its Request, the Postal Service certifies that it has complied 
with the early notification requirement specified for provisional 
service requests in 39 CFR 3001.173(d).

Compliance With Certain Filing Requirements

    The Postal Service's request was also accompanied by a Notice 
Concerning Compliance Statement, Or, In The Alternative, Motion Of The 
United States Postal Service For Waiver Of Certain Provisions Of Rule 
64(h). In this Notice, the Service observes that the circumstances of 
this docket, and compliance with the filing requirements specified in 
39 CFR 3001.54 and 3001.64, are complicated by the pendency of the 
omnibus rate proceeding in Docket No. R97-1.<SUP>4</SUP> The Service 
states that the information it presented in support of its Request in 
R97-1 is responsive to the requirements of 39 CFR 3001.54 and 3001.64 
for both that proceeding and the instant docket, and that its 
compliance statement in this docket accordingly incorporates certain 
information provided in R97-1 by reference.
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    \4\ The Postal Service filed a Request for a recommended 
decision on proposed changes in domestic postage rates and fees, and 
proposed changes in certain mail classifications, on July 10, 1997. 
See Order No. 1186, 62 FR 39660-39709 (July 23, 1997).
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    Nevertheless, the Service states that it has developed cost 
estimates for the proposed packaging service ``using inputs from prior 
rate proceedings.'' Notice at 2. The Postal Service explains that this 
approach is intended to accommodate participants' and the Commission's 
needs to evaluate the cost information and theories it presents in R97-
1 without tying the procedural schedule in this proceeding to the 
schedule in the ongoing omnibus rate case, and thus to allow 
consideration of its provisional service proposal within the 90-day 
schedule specified in Sec. 3001.174.
    However, should the Commission consider the current filing's 
reliance on documentation presented in the pending omnibus rate case to 
be an impediment to expedited consideration of its packaging proposal, 
the Postal Service moves in the alternative for waiver of certain 
requirements set out in Sec. 3001.64(h). Specifically, the Service's 
alternative motion seeks a waiver of 39 CFR 3001.54(b)(3) in part, (d) 
in part, (f)(2) and (f)(3), (h), (j), and (l) in part. In general, the 
Service justifies waiver of these provisions in light of the limited 
nature and anticipated effects of the packaging proposal.

Further Procedures.

    Section 173(b) provides that interested persons may intervene in a 
provisional service proceeding within 28 days after the filing of the 
Postal Service's Request. Accordingly, anyone wishing to be heard in 
this matter is directed to file a written notice of intervention with 
Margaret P. Crenshaw, Secretary of the Commission, 1333 H Street, NW., 
Washington, DC 20268-0001, on or before August 26, 1997. Intended 
participants should indicate whether they request formal

[[Page 42272]]

intervention or limited participator status. See 39 CFR 3001.20 and 
3001.20a.
    Section 173(e) of the rules of practice (39 CFR 3001.173(e)) states 
that the Commission will hold hearings on a Postal Service Request for 
a provisional service change ``when it determines that there is a 
genuine issue of material fact to be resolved, and that a hearing is 
needed to resolve that issue.'' To assist that determination, the same 
provision directs parties who wish to dispute a genuine issue of 
material fact to file a request for a hearing, which:

shall state with specificity the fact or facts set forth in the 
Postal Service's filing that the party disputes, and when possible, 
what the party believes to be the true fact or facts and the 
evidence it intends to provide in support of its position.

Ibid.
    Any participant who wishes to dispute a genuine issue of material 
fact to be resolved in this proceeding shall file a request for a 
hearing as specified in Sec. 173(e) by August 26, 1997. In order to 
assist the Commission's determination of whether a hearing is 
necessary, should any written discovery be directed to the Postal 
Service by a participant before August 26, 1997, the Postal Service 
shall respond within 10 days.
    A prehearing conference will be held in this proceeding on 
Thursday, August 28, 1997, at 9:30 a.m. in the Commission's hearing 
room. Participants should be prepared to discuss what formal 
procedures, including hearings, may be necessary and appropriate in 
this docket. If the Commission determines that formal hearings to 
resolve genuine issues of material fact are required, hearings to 
evaluate the supporting evidence presented by the Postal Service may be 
scheduled to begin as soon as September 3, 1997. The presiding officer 
will establish subsequent procedural dates.

Representation of the General Public

    In conformance with 39 U.S.C. 3624(a), the Commission designates W. 
Gail Willette, Director of the Commission's Office of the Consumer 
Advocate (OCA), to represent the interests of the general public in 
this proceeding. Pursuant to this designation, Ms. Willette will direct 
the activities of Commission personnel assigned to assist her and, when 
requested, will supply their names for the record. Neither Ms. Willette 
nor any of the assigned personnel will participate in or provide advice 
on any Commission decision in this proceeding. The OCA shall be 
separately served with three copies of all filings, in addition to and 
contemporaneous with, service on the Commission of the 24 copies 
required by Sec. 10(c) of the rules of practice (39 CFR 3001.10(c)).

It is ordered:

    1. The Commission will sit en banc in this proceeding.
    2. Notices of intervention shall be filed no later than August 26, 
1997.
    3. Participants who wish to request a hearing in this matter shall 
submit a request in conformance with 39 CFR Sec. 3001.173(e) no later 
than August 26, 1997.
    4. Answers to the Postal Service's Notice Concerning Compliance 
Statement, or, in the Alternative, Motion for waiver of Certain 
Provisions of Rule 64(h) are to be submitted no later than August 26, 
1997.
    5. The Postal Service shall provide responses to any written 
discovery requests submitted to it before August 26, 1997, within 10 
days.
    6. W. Gail Willette, Director of the Commission's Office of the 
Consumer Advocate, is designated to represent the general public.
    7. A prehearing conference in this docket shall be held on 
Thursday, August 28, 1997, at 9:30 a.m. in the Commission's hearing 
room.
    8. The Secretary shall cause this notice and order to be published 
in the Federal Register.

    By the Commission.
Margaret P. Crenshaw,
Secretary.
[FR Doc. 97-20628 Filed 8-5-97; 8:45 am]
BILLING CODE 7710-FW-P