Proposed Rule2025-19557
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
October 15, 2025
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 90 Issue 197 (Wednesday, October 15, 2025)</title>
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[Federal Register Volume 90, Number 197 (Wednesday, October 15, 2025)]
[Proposed Rules]
[Pages 48268-48270]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2025-19557]
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POSTAL REGULATORY COMMISSION
39 CFR Part 3050
[Docket No. RM2025-13; Order No. 9228]
Periodic Reporting
AGENCY: Postal Regulatory Commission.
[[Page 48269]]
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: November 3, 2025.
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 September 30, 2025, 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 a methodology to incorporate mail
processing costs for Undeliverable-As-Addressed (UAA) mail into the
First-Class Mail and USPS Marketing Mail letter cost models. Petition,
Proposal at 1.
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\1\ Petition of the United States Postal Service to Initiate a
Proceeding to Change Analytical Principles, September 30, 2025
(Petition). The proposed change is attached to the Petition
(Proposal).
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II. Proposal
Background. The Postal Service explains that UAA mail is mail that
cannot be delivered as addressed and must be forwarded, returned to
sender, or treated as waste or dead mail. Id. The Postal Service
asserts that the processing of UAA mail ``create[s] additional costs
for the Postal Service and affect[s] the timeliness of mail delivery''
because once mail is identified as UAA, it is removed from the general
mail processing stream, its original presort characteristics are
disregarded, and it is redirected before being returned to the mail
processing stream. Id. at 1-2. The Postal Service asserts that this is
primarily driven by large numbers of customer address changes and
resulted in more than 2.5 billion UAA letters in 2024. Id. at 1. The
Postal Service provides detailed information concerning its handling of
UAA mail in the Proposal. See id. at 4-7.
The Postal Service states that the current methodology for
measuring mail processing unit costs and workshare-related savings does
not include UAA activities. Id. at 2. As a result, UAA activities are
currently ``encompassed in the numerator of the Cost and Revenue
Analysis (CRA) adjustment factor[,]'' which ``assumes that UAA
activities are proportional to the presort levels within a mail
category.'' Id. The Postal Service asserts that this assumption is
problematic because the level of presortation of a mailpiece is
independent of whether mail recipients have changed addresses and UAA
handling costs are ``not impacted by the presort discount given to the
piece.'' Id. at 2-3. The Postal Service claims that ``the current
proportionality assumption inflates the measure of presort cost
avoidances, distorts price signals, and generates economic
inefficiencies.'' Id. at 3.
Proposal. The Postal Service proposes to include UAA costs, where
such costs are independent of presort level, in the denominator of the
CRA proportional adjustment factor calculation. Id. at 4. This change
would reduce the CRA proportional adjustment factor for each affected
mail category and reduce the avoided costs associated with
presortation. Id. The Postal Service provides two model workbooks
demonstrating the UAA letter-model framework for Fiscal Year 2024
First-Class Mail and USPS Marketing Mail, respectively, which it
asserts contain all cost calculations with links to supplementary
workbooks containing essential data elements.\2\ In the Proposal, the
Postal Service further describes the essential data elements, how they
are calculated, and how they are applied in the framework to calculate
UAA unit costs. Petition, Proposal at 7-19.
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\2\ Id. at 7; ZIP file ``UAA Letter Cost Models.zip,'' September
30, 2025, Excel files ``UAA FCM Letter Costs FY24.xlsx'' and ``UA MM
Letter Costs FY24.xlsx.'' The supplementary workbooks are contained
in ZIP file ``UAA Letter Cost Models.zip'' and described in the
Proposal. Petition, Proposal at 19-20.
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Impact. The Postal Service evaluates the Proposal's impact by
identifying the changes in the CRA adjustment factor and the resulting
changes in avoided costs as compared to the current approach. Id. at
20. The Postal Service states that including UAA costs would reduce the
CRA proportional adjustment factor compared to the current approach.
Id. at 21. The proposed framework would also result in new CRA unit
costs that vary for each presort category, which the Postal Service
presents in tables in the Proposal. Id. at 21, 24-25 (Tables 8 and 9).
With respect to changes in avoided costs, the Postal Service
provides calculations of the impacts on avoided costs in ZIP file ``UAA
Letter Cost Models.zip,'' Excel file ``UAA Avoided Cost Impacts
FY24.xlsx.'' Id. at 22. The Postal Service states that incorporating
UAA processing activities would result in a decrease in cost avoidance
of $134 million or 8.1 percent for First-Class Mail and of $14 million
or 1.0 percent for USPS Marketing Mail. Id. at 23, 26 (Table 10). The
Postal Service also presents the current workshare discounts, avoided
costs, and passthroughs for First-Class Mail and USPS Marketing Mail
letters in two tables and illustrates how the avoided costs and
passthroughs would be changed by the Proposal. Id. at 23, 27-28 (Tables
11 and 12). The Postal Service acknowledges that the Proposal would
cause some workshare discounts to fall out of compliance with 39 CFR
part 3030, subpart J and represents that it will correct any
noncompliance in future rate adjustment proceedings if the Commission
approves the Proposal. Id. at 23.
III. Notice and Comment
The Commission establishes Docket No. RM2025-13 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
no later than November 3, 2025. Pursuant to 39 U.S.C. 505, Katalin
Clendenin is designated as an officer of the Commission (Public
Representative) to represent the interests of the general public in
this proceeding. The Public Representative does not represent any
individual person, entity or particular point of view, and, when
Commission attorneys are appointed, no attorney-client relationship is
established.
IV. Ordering Paragraphs
It is ordered:
1. The Commission establishes Docket No. RM2025-13 for
consideration of the matters raised by the Petition of the United
States Postal Service to Initiate
[[Page 48270]]
a Proceeding to Change Analytical Principles, filed September 30, 2025.
2. Comments by interested persons in this proceeding are due no
later than November 3, 2025.
3. Pursuant to 39 U.S.C. 505, the Commission appoints Katalin
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 the publication of this order in
the Federal Register.
By the Commission.
Erica A. Barker,
Secretary.
[FR Doc. 2025-19557 Filed 10-14-25; 8:45 am]
BILLING CODE 7710-FW-P
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