Proposed Rule2024-27284
Periodic Reporting
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
November 22, 2024
Issuing agencies
Postal Regulatory Commission
Abstract
The Commission is acknowledging a recent Postal Service filing requesting the Commission initiate a rulemaking proceeding to consider changes to analytical principles relating to periodic reports. This document informs the public of the filing, invites public comment, and takes other administrative steps.
Full Text
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<title>Federal Register, Volume 89 Issue 226 (Friday, November 22, 2024)</title>
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[Federal Register Volume 89, Number 226 (Friday, November 22, 2024)]
[Proposed Rules]
[Pages 92614-92616]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2024-27284]
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POSTAL REGULATORY COMMISSION
39 CFR Part 3050
[Docket No. RM2025-4; Order No. 8002]
Periodic Reporting
AGENCY: Postal Regulatory Commission.
ACTION: Notice of proposed rulemaking.
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SUMMARY: The Commission is acknowledging a recent Postal Service filing
requesting the Commission initiate a rulemaking proceeding to consider
changes to analytical principles relating to periodic reports. This
document informs the public of the filing, invites public comment, and
takes other administrative steps.
DATES: Comments are due: December 10, 2024.
ADDRESSES: Submit comments electronically via the Commission's Filing
Online system at <a href="https://www.prc.gov">https://www.prc.gov</a>. 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
III. Notice and Comment
IV. Ordering Paragraphs
I. Introduction
On November 13, 2024, 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 presents a methodology for developing
shape-specific labor productivity data for non-MODS manual distribution
activities using eFlash volumes and workhours derived from costs for
the corresponding In-Office Cost System (IOCS)-based non-MODS cost
pools. Petition at 1.
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\1\ Petition of the United States Postal Service to Initiate a
Proceeding to Change Analytical Principles and Notice of Filing Non-
Public Materials, November 13, 2024 (Petition). The proposed change
is attached to the Petition (Proposal).
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II. Proposal
Background. The Postal Service states that measuring labor
productivity associated with manual letter and flat distribution
operations ``is a longstanding challenge for modeling the
[[Page 92615]]
costs of mail processing flows in the development of avoided costs for
worksharing.'' Id. Proposal at 1. The Postal Service notes that
directly measuring the number of manually processed pieces is
``costly'' in the absence of passive data collection, which is possible
in automated operations. Id. Additionally, the reliability of measuring
productivity depends on accurately measuring workhours. Id.
The Postal Service notes that MODS workhours ``have long been used
both to develop labor costs by cost pool and in labor productivity
statistics for mail processing plants,'' but operation-level workhour
data have not been used to develop costs for non-MODS operations. Id.
The Postal Services states that manual productivities' volume inputs
use either indirect volume measurements or special studies of
distribution productivity, which are limited in frequency and scope.
Id. at 2. The Postal Service notes that, currently, the projection of
manually processed mail volumes is determined as fractions of
automation piece counts, which has not been updated since Fiscal Year
(FY) 2015 ``due to concerns regarding the reliability of those
conversion methods.'' Id. It also notes that manual productivity for
incoming secondary letter distribution dates to Docket No. MC95-1, when
plants conducted significant amounts of manual incoming secondary
sortation for letters and flats.\2\ Although manual productivity has
focused on plant and Network Distribution Center (NDC) operations,
manual distribution work is ``concentrated at non-MODS post offices,
stations, and branches'' making productivities applicable to non-MODS
operations an important aspect for modeling manual mail processing
costs. Id.
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\2\ Id. However, manual processing volume for parcels is
generated as a ``byproduct of tracking scans taken during proceeding
activities.'' Id.
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The Postal Service asserts that the eFlash system can be used as a
source of manual processing volumes for non-MODS operations and covers
letters, flats, and parcels distribution. Id. at 3. These volumes are
obtained by converting linear measurements (in inches) of pieces staged
for processing into piece counts and is standard operating procedure
for both larger and smaller post offices. Id. Additionally, the Postal
Service states that eFlash data also includes workhours for letter,
flat, and parcel operations in Labor Distribution Code (LDC) 43. Id.
The Postal Service explains that, to determine whether eFlash
workhours could be used in productivity calculations, it investigated
``both the extent to which the eFlash workhours covered the
corresponding mail processing cost pools and the extent to which the
eFlash workhours included activities other than the expected shape-
related processing work.'' Id. The Postal Service notes that the
concerns are ``post office activities may be relatively fluid over the
course of the workday, such that actual and clocked work activities may
systematically differ, and relatedly that a substantial amount of post
office distribution labor may be clocked into non-shape-specific mail
processing operations.'' Id. at 3-4. The Postal Service's investigation
indicated that eFlash workhours underestimate total labor used in the
shape-related cost pools and that, as a result, the use of eFlash
workhours will overstate labor productivities. Id. at 4-6.
Proposal. Based on the discussion above, the Postal Service states
that its proposed productivities would use ``eFlash-based aggregate
volumes for letters, flats, and parcels, from the L43L, L43F, and L43P
lines, respectively, for the numerator of the productivity (pieces per
workhour).'' Id. at 6-7. The Postal Service also states that, to obtain
corresponding workhour estimates, the proposed methodology would
convert the total cost for the non-MODS manual letters, flats, and
parcels cost pools into hours using the mail processing wage rate, and
the resulting workhours would then be used as the denominator of the
productivity calculation. Id. at 7. Table 4 of the Proposal
demonstrates the proposed conversion of costs to workhours for FY 2023.
See id. table 4. The Postal Service then combines the eFlash volumes
with the converted workhours, which results in the productivities
presented in table 5 of the Proposal. See id. at 8, table 5.
The Postal Service maintains that the proposed changes are an
improvement to the currently used productivity data. Id. at 8. It
states that the proposed changes ``employ[ ] current data collected in
ongoing systems that directly represent post office distribution
operations and can be updated annually.'' Id. The proposed changes
would also eliminate the use of ``stale'' data. Id. at 8-9; see
generally supra.
Impact. The Postal Service explains that ``the new [labor]
productivity will (other things equal) decrease model costs if the new
productivity is higher or increase them if the new productivity is
lower.'' Petition, Proposal at 10. ``The change in model costs will
then affect the model's proportional adjustment factor in the opposite
direction. . . .'' Id.
The Postal Service then explains that the magnitude of the effect
of the productivity change will depend upon the extent to which various
categories of mail require manual processing in Function 4 operations.
Id. The Postal Service again notes that most parcel volume receives
Function 4 sorts whereas most letter and flat volumes bypass it, either
because of automation or presorting to carrier route. Id.
The Postal Service presents the impact of Function 4 letter
productivity on the letter cost model results in USPS-FY23-10 (table
7), the impact of Function 4 flat productivity on the First-Class and
USPS Marketing Mail flat cost model in USPS-FY23-11 (table 8), and the
impact of Function 4 flat productivity on the piece costs in the
Periodicals model in USPS-FY23-11 (table 9). See id. at 11-12. In
addition, the impact of Function 4 parcel productivity on the Parcel
Select mail processing cost model are filed under seal. Id. at 12.
III. Notice and Comment
The Commission establishes Docket No. RM2025-4 for consideration of
matters raised by the Petition. More information on the Petition may be
accessed via the Commission's website at <a href="https://www.prc.gov">https://www.prc.gov</a>.
Interested persons may submit comments on the Petition and the Proposal
by December 10, 2024. Pursuant to 39 U.S.C. 505, Nikki Brendemuehl 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. RM2025-4 for consideration
of the matters raised by the Petition of the United States Postal
Service to Initiate a Proceeding to Change Analytical Principles and
Notice of Filing Non-Public Materials, filed November 13, 2024.
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2. Comments by interested persons in this proceeding are due
December 10, 2024.
3. Pursuant to 39 U.S.C. 505, the Commission appoints Nikki
Brendemuehl 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 the publication of this order in
the Federal Register.
By the Commission.
Erica A. Barker,
Secretary.
[FR Doc. 2024-27284 Filed 11-21-24; 8:45 am]
BILLING CODE 7710-FW-P
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</html>Indexed from Federal Register on November 22, 2024.
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