[Federal Register Volume 75, Number 128 (Tuesday, July 6, 2010)]
[Rules and Regulations]
[Pages 38725-38745]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-16178]
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POSTAL REGULATORY COMMISSION
39 CFR Parts 3050 and 3055
[Docket No. RM2009-12; Order No. 465]
Service Performance Measurement
AGENCY: Postal Regulatory Commission.
ACTION: Final rule.
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SUMMARY: The Commission is adopting a final rule on service perfomance
measurement and customer satisfaction. The final rule reflects the
Commission's consideration of comments on a proposed rule. Adoption of
the final rule helps give effect to provisions in a 2006 federal law
which, among other things, sought to increase Postal Service
accountability. The Commission recognizes that exceptions from, and
temporary waivers of, some reporting requirements may be appropriate.
The discussion makes clear that these matters may be pursued in
separate follow-up rulemakings initiated by the Postal Service.
[[Page 38726]]
DATES: This rule is effective on August 5, 2010.
FOR FURTHER INFORMATION CONTACT: Stephen L. Sharfman, General Counsel,
at [email protected] or 202-789-6820.
SUPPLEMENTARY INFORMATION: Regulatory History, 74 FR 49190 (September
25, 2009).
Table of Contents
I. Introduction
II. Procedural History
III. Statutory Provisions
IV. General Issues
A. Quantifying Costs and Burdens
B. Objection to Quarterly Reports
C. Implementation of Rules
D. Continuing Oversight
V. Service Performance Measurements Reporting
A. Annual Reporting
B. Quarterly Reports
C. Proposals to Expand the Scope of the Service Performance
Rules
VI. Reporting of Customer Sastisfaction
A. General Considerations
B. Rule 3055.91--Consumer Access to Postal Services
C. Rule 3055.92--Customer Experience Measurement Surveys
D. Rule 3055.93--Mystery Shopper Program
E. Suggested Data Reporting Item
VII. Ordering Paragraphs
I. Introduction
The final rules described herein establish Postal Service reporting
requirements for measuring the level of service and degree of customer
satisfaction for each market dominant product. The reporting of level
of service and customer satisfaction are required by 39 U.S.C.
3652(a)(2)(B) as part of the Postal Service's annual report to the
Commission; are a necessary part of the modern system of rate
regulation for market dominant products as required by 39 U.S.C. 3622;
and support the Commission's responsibility to report on universal
service as required by 39 U.S.C. 3651(b)(1)(A). The Commission's
authority to promulgate the form and content of these reporting rules
is 39 U.S.C. 503, 3622(a), 3652(d) and (e), and 3651(c).
Order No. 292, which provides notice of this rulemaking, describes
each rule as proposed. The original descriptions have not been repeated
in the final order except when necessary to add clarity to the
discussion.\1\ They may be relied upon, except where noted, and may be
considered as incorporated by reference. The rules adopted by the final
order are substantially the same as those originally proposed, with
relatively few modifications. Specific discussions in this order are
limited to rules that are the subject of actionable comments.
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\1\ Notice of Proposed Rulemaking on Periodic Reporting of
Service Performance Measurements and Customer Satisfaction,
September 2, 2009 (Order No. 292); see also 74 FR 49190 (September
25, 2009).
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The order contains three substantive sections: (1) General issues
applicable to both the reporting of service performance measurements
and customer satisfaction (section IV); (2) rules applicable to service
performance measurement reporting (section V); and (3) rules applicable
to reporting of customer satisfaction (section VI).
Four issues of general applicability are addressed in section IV of
this order.
1. The Commission, in the notice of rulemaking, invited the Postal
Service to identify requirements that it might view as onerous or
costly to implement, and to quantify the associated costs. The Postal
Service did not reply to this invitation with the level of specificity
necessary to consider changes to the proposed rules. The Commission and
interested parties would have benefited from this information when
evaluating each rule. Over 3 years have passed since the enactment of
the Postal Accountability and Enhancement Act (PAEA) of 2006. The
Commission finds that reporting of service performance measurements and
customer satisfaction must begin without further delay.
2. The Commission adopted the Postal Service's general approach to
providing both annual and quarterly reports in developing the proposed
rules. However, the Postal Service, for the first time in its comments,
offers a new legal argument that quarterly reporting is beyond what is
required by the PAEA. After adopting the Postal Service's proposed
approach, the Commission does not agree with the Postal Service's new
argument that its approach is legally flawed. The final rule retains
requirements for both annual and quarterly reporting.
3. The Postal Service outlines its capabilities to comply with the
proposed rules. The indications are that the Postal Service still faces
a major effort to be able to report service performance as contemplated
by the PAEA. The Commission finds it necessary to prescribe a process
for ensuring timely compliance with the rules given the current status
of the Postal Service's reporting capability.
4. Finally, several commenters propose various approaches for
continuing Commission oversight of service performance reporting. The
Commission views service performance reporting predominately as part of
the Annual Compliance Report/Annual Compliance Determination process,
but may take other action as necessary.
Section V of this order discusses specific comments concerning the
rules for service performance measurement reporting. Annual reporting
requirements are addressed in section V.A, quarterly reporting
requirements are addressed in section V.B, and proposals which
potentially expand reporting requirements are addressed in section V.C.
For the most part, service performance reporting rules are adopted
as proposed. Explanations are provided where comments indicate there
could be possible confusion in the interpretation of the rules, and
minor wording changes to add clarity to the rules have been
incorporated. A proposal to require the Postal Service to provide
explanations when requirements are not met is adopted in rule
3055.2(h). This is a task required of the Postal Service in any event.
Also, a proposal which modifies the Standard Mail service day groupings
for reporting purposes is adopted. See rule 3055.50(a). Proposals to
modify the proposed rules that were not adopted include elimination of
certain documentation requirements, an alternative documentation
methodology, expanding the categories of exceptions, raising the
standard of review consistent with the ``analytical principles''
methodology, and eliminating a special study of areas with a unique
mailing characteristic.
Proposals also were presented which would expand the reporting
requirements. These include proposals concerning forwarding and return
of First-Class Mail, tail of the mail, remittance mail, critical entry
times, and actionable raw data, among others. None of these proposals
have been adopted at this time.
Section VI of this order discusses the reporting of customer
satisfaction. The reporting of customer satisfaction is a new reporting
requirement imposed for the first time by the PAEA. This requirement is
not well defined, and will require development through the regulatory
rulemaking process. This rulemaking is the first step in the process of
developing satisfactory reporting requirements. Minor terminology
changes to provide the most recent names of Postal Service programs are
incorporated. A requirement to provide certain Mystery Shopper Program
information proposed as rule 3055.93 has not been adopted.
To facilitate the interpretation of the final rules, the market
dominant product list appears in the Appendix as Table 1-Market
Dominant Product List as of August 10, 2009 to this rulemaking;
illustrative examples of annual data reporting charts appear in
[[Page 38727]]
the Appendix as Table 2-Illustrative Annual Report Data Reporting
Charts; illustrative examples of quarterly data reporting charts appear
in the Appendix as Table 3-Illustrative Quarterly Report Data Reporting
Charts; and illustrative examples of customer satisfaction data
reporting charts appear in the Appendix as Table 4-Illustrative
Customer Satisfaction Data Reporting Charts. Because these charts are
merely illustrative, they will not be published in the Federal
Register.
All final rules for adoption as new part 3055 of the Commission's
rules of practice and procedure appear after the signature of this
order. In general, reserved clauses that appeared in the proposed rules
are eliminated in the final version.
II. Procedural History
On September 2, 2009, the Commission established Docket No. RM2009-
11 to consider the addition of service performance and customer
satisfaction reporting requirements to the Commission's rules of
practice and procedure. The Commission issued Order No. 292 to
establish this docket; propose amendments to its rules of practice and
procedure; seek comments and reply comments from interested persons;
and publish notice of this proceeding in the Federal Register. Order
No. 292 also designated Emmett Rand Costich and James Callow to
represent the interests of the general public pursuant to 39 U.S.C.
505.
The Commission proposed to amend its rules of practice and
procedure by adding new part 3055--Service Performance and Customer
Satisfaction Reporting. This part is further subdivided into Subpart
A--Annual Reporting of Service Performance Achievements, Subpart B--
Periodic Reporting of Service Performance Achievements, and Subpart C--
Reporting of Customer Satisfaction.
Establishing rules to report service performance (subparts A and B)
is the final step in a four-step process for incorporating measurements
of level of service into the modern system of rate regulation for
market dominant products. The previous steps established service
standards, identified service performance measurement systems, and
established performance goals.
The establishment of service standards is mandated by 39 U.S.C.
3691, which requires the Postal Service, in consultation with the
Postal Regulatory Commission, to establish by regulation a set of
modern service standards for market dominant products. Initial
consultations between the Commission and the Postal Service concluded
on November 19, 2007, with the Commission providing the Postal Service
with comments addressing the Postal Service's service standards
proposals.\2\ The Postal Service completed this task by publishing as a
final rule Modern Service Standards for Market Dominant Products,
December 19, 2007 (Service Standards).\3\
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\2\ Comments of the Postal Regulatory Commission on Modern
Service Standards for Market Dominant Products, November 19, 2007.
The consultations are described as ``initial'' because of the
ongoing nature of consultations that is necessary to transition from
a set of standards to an operational measurement system encompassing
performance goals (see uncodified section 302(b)(1) of the PAEA) and
reporting mechanisms (see 39 U.S.C. 3652).
\3\ 73 FR 72216 (December 19,2007) (to be codified at 39 CFR
parts 121 and 122).
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In June 2008, the Postal Service identified service performance
measurement systems by providing the Commission with a draft of its
Service Performance Measurement plan (Plan).\4\ The Plan presents the
various systems the Postal Service proposes to use to measure the
standards presented in the Service Standards document.\5\ The Postal
Service submitted the Plan for the Commission's ``review, feedback, and
concurrence.''\6\ In response, the Commission initiated Docket No.
PI2008-1 to consider the Plan and to solicit public comment. This
process culminated with the Commission issuing Order No. 140.\7\ This
order completed the second step in the process by approving the
approaches that the Postal Service proposes to take in developing
internal measurement systems for various classes of mail.\8\
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\4\ The Commission published the Plan in Docket No. PI2008-1,
Second Notice of Request for Comments on Service Performance
Measurement Systems for Market Dominant Products, June 18, 2008
(Order No. 83). The draft published in Order No. 83 was the final
draft in a series of drafts provided by the Postal Service to the
Commission.
\5\ An objective in designing service performance standards is
for the Postal Service to provide a ``system of objective external
performance measurements for each market dominant product as a basis
for measurement of Postal Service performance.'' 39 U.S.C.
3691(b)(1)(D). Howewer, ``with the approval of the Postal Regulatory
Commission an internal measurement system may be implemented instead
of an external measurement system'' for individual products. 39
U.S.C. 3691(b)(2). In the Plan the Postal Service proposes various
internal, external, and hybrid (containing both internal and
external elements) measurment systems to measure the performance of
its mail products.
\6\ Letter from Thomas G. Day, Senior Vice President, United
States Postal Service, to Dan G. Blair, Chairman, Postal Regulatory
Commission, June 3, 2008.
\7\ Docket No. PI2008-1, Order Concerning Proposals for Internal
Service Standards measurement Systems, November 25, 2008 (Order No.
140.)
\8\ Approval was provided with the exception of the measurement
systems for several Special Services where the Commission directed
the Postal Service to propose a remedial plan by June 1, 2009. The
Postal Service submitted remedial proposals on May 15, 2009. See
Letter from Thomas G. Day, Senior Vice President, Intelligent Mail
and Address Quality, United States Postal Service, to Dan G. Blair,
Chairman, Postal Regulatory Commission, May 15, 2009 (May 15, 2009
Letter from Thomas G. Day).
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The PAEA directed the Postal Service, in consultation with the
Commission, to develop and submit to Congress a plan for meeting
service standards. Congress directed, inter alia, that the plan
establish performance goals. The Postal Service posted its FY 2009
targets on its Rapid Information Bulletin Board System (RIBBS) Web page
at http://www.ribbs.gov/targets/documents/tech_guides/Targets.pdf.
The Postal Service's Plan included proposals for both annual and
quarterly reporting of service performance measurements. The Commission
solicited comments on service performance reporting when it considered
the Postal Service's proposals for measurement systems. However, in
Order No. 140, the Commission limits its considerations of those
comments in anticipation of the instant rulemaking, which specifically
addresses reporting requirements. The fourth and final step in the
process, and the subject of this rulemaking, is for the Commission to
issue rules specifying the reporting of service performance (subparts A
and B).
Establishing rules to report customer satisfaction (subpart C)
previously had not been addressed by the Postal Service or the
Commission. Proposed rules appeared for the first time in the notice of
proposed rulemaking establishing this docket.
In this docket, comments pertaining to all proposed rules (subparts
A, B and C) were received from ACMA, PostCom/DMA, Bank of America, PSA,
the Public Representative, the Postal Service, and Valpak.\9\ Reply
comments were received from PostCom/DMA, Bank of America, DMA, MOAA,
PSA, the Public
[[Page 38728]]
Representative, the Postal Service, and Valpak.\10\
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\9\ Comments of the Association for Postal Commerce and the
Direct Marketing Association in Response to Order No. 292 (PostCom/
DMA Comments); Comments of Bank of America Corporation (Bank of
America Comments); Comments of the Parcel Shippers Association on
PRC Notice of Proposed Rulemaking (PSA Comments); Comments of the
Public Representative in Response to Order No. 202 (Public
Representative Comments); United States Postal Service Comments in
Response to Order No. 292 (Postal Service Comments); Valpak Direct
Marketing Systems, Inc. and Valpak Dealers' Association, Inc.
Initial Comments on Proposed Rulemaking on Periodic Reporting
(Valpak Comments), all filed November 2, 2009; and Comments of the
American Catalog Mailers Association, November 3, 2009 (ACMA
Comments).
\10\ Valpak Direct Marketing Systems, Inc. and Valpak Dealers'
Association, Inc. Reply Comments on Proposed Rulemaking on Periodic
Reporting, November 24, 2009 (Valpak Reply Comments); Reply Comments
of the Association for Postal Commerce and the Direct Marketing
Association in Response to Order No. 292 (PostCom/DMA Reply
Comments); Reply Comments of Bank of America Corporation (Bank of
America Reply Comments); Additonal Reply Comments of the Direct
Marketing Association to Commission Order No. 292 (DMA Reply
Comments); Reply Comments of the Mail Order Association of America
on PRC Notice of Proposed Rulemaking (MOAA Reply Comments); Reply
Comments of the Parcel Shippers Association of PRC Notice of
Proposed Rulemaking (PSA Reply Comments); and United States Postal
Service Reply Comments in Response to Order No. 292, December 2,
2009 (Public Representative Reply Comments).
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Late in this proceeding, the Postal Service informed the Commission
that it would provide additional material concerning forwarded mail.
Postal Service Reply Comments at 36. This material was provided in
response to a Commission request in Docket No. PI2008-1 to ``explore
the cost of periodically conducting studies of service performance for
forwarded and returned First-Class Mail and inform the Commission of
their feasibility by the conclusion of fiscal year 2009.'' Order No.
140 at 24. This material is attached to a Postal Service motion
requesting that it be considered in connection with the instant docket
(Docket No. RM2009-11).\11\ The Public Representative subsequently
offers supplemental comments concerning this material.\12\
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\11\ Motion of the United States Postal Service to File Report
on Performance Measurement of Forwarded Mail, December 10, 2009
(Postal Service Supplemental Comments); see also Order No. 364,
Order Granting Motions Concerning Postal Service Report on
Performance Measurement of Forwarded Mail, December 17, 2009.
\12\ Public Representative Comments in Response to Postal
Service Report on Performance Measurement of Forwarded Mail,
December 16, 2009 (Public Representative Supplemental Comments).
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III. Statutory Provisions
Section 3652(a)(2) of title 39 requires that the Postal Service
include in an annual report to the Commission an analysis of the
quality of service ``for each market-dominant product provided in such
year'' by providing ``(B) measures of the quality of service afforded
by the Postal Service in connection with such product, including--(i)
the level of service (described in terms of speed of delivery and
reliability) provided; and (ii) the degree of customer satisfaction
with the service provided.'' In complying with this requirement, the
Commission has authority to ``by regulation, prescribe the content and
form of the public reports (and any nonpublic annex and supporting
matter relating to the report) to be provided by the Postal Service * *
* .'' 39 U.S.C. 3652(e)(1).\13\ The Commission also is to have access
to ``supporting matter'' in connection with any information submitted
under this section. 39 U.S.C. 3652(d).
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\13\ The Commission's authority is continuing as it has further
authority to initiate proceedings to improve the quality, accuracy
and completeness of data whenever it shall appear that ``the quality
of service data has become significantly inaccurate or can be
significantly improved.'' 39 U.S.C. 3652(e)(2(B).
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Section 3622 of title 39 provides that the Commission by regulation
establish ``a modern system for regulating rates and classes for
market-dominant products.'' The quality of service, and its reporting,
forms an integral part of many of the objectives and factors set forth
in this section. Reporting on quality of service allows assessment of
whether the Postal Service is meeting the objective of maintaining the
``high quality service standards established under section 3691.'' 39
U.S.C. 3622(b)(3). It furthers the objective of increasing ``the
transparency of the ratemaking process.'' 39 U.S.C. 3622(b)(6). It
allows assessment of the factors addressing value of service, and by
association with the proposed measurement systems, the value of
intelligent mail. 39 U.S.C. 3622(c)(1), (8), and (13). Finally, it is
important in relation to the rate cap requirements of 39 U.S.C.
3622(d)(1)(A) when analyzing whether quality of service is impacted in
order to comply with rate cap requirements.
Section 3651(b)(1)(A) of title 39 requires that the Commission
report to the President and Congress on an annual basis estimates of
the costs incurred by the Postal Service in providing universal
service. Describing the quality of service afforded a product, both
anticipated and actual, is a necessary element in analyzing what
service is being provided at a given cost. The Postal Service is to
provide the Commission with such information that may, in the judgment
of the Commission, be necessary in completing this report. 39 U.S.C.
3651(c).
IV. General Issues
The four issues addressed in this section are applicable to both
the rules concerning service performance measurements and to the rules
concerning reporting of customer satisfaction. They include quantifying
costs and burdens, an objection to providing reports on a quarterly
basis, an implementation procedure for ensuring future full compliance
with the rules, and the continuing oversight role of the Commission.
A. Quantifying Costs and Burdens
The Commission invited the Postal Service to identify requirements
imposed by the proposed rules that would be particularly onerous or
costly to comply with.
If a new requirement in these proposed rules is viewed by the
Postal Service as particularly onerous, or involves costly new data
collection that does not appear to add needed transparency, the
Postal Service is requested to identify it and attempt to quantify
its incremental cost.
Order No. 292 at 2.
Other than general comments addressing costs and burdens, the
Postal Service did not reply with the specificity necessary to consider
changes to the proposed rules.
Several parties commented on the Postal Service's limited response.
Bank of America states that it shares the Postal Service's interest in
minimizing implementation costs and administrative burdens. However, it
notes that the Postal Service had not quantified the costs associated
with complying with burdensome requirements, nor had it proposed rule
modifications to mitigate perceived burdens. Bank of America Reply
Comments at 1. PostCom/DMA comments that ``in order to assess what is
or is not reasonable, the Commission and affected mailers must be
provided with some estimation--and not merely broad, unsupported and
self contradictory statements--as to cost.'' PostCom/DMA Reply Comments
at 2. PSA similarly notes that the Postal Service had not quantified
costs or burdens. PSA Reply Comments at 1-2.
Noting that the Postal Service had not quantified onerous costs or
burdens, PSA urges the Commission to not make significant changes to
the proposed rules. Id. at 3. Bank of America suggests that the Postal
Service be provided another opportunity to identify onerous costs or
burdens. Bank of America Reply Comments at 2.
A more detailed response from the Postal Service would have
benefited the Commission and other commenters in weighing the costs and
burdens of complying with the proposed rules against the importance of
the information that is being gathered. This would have provided an
opportunity to consider specific alternatives at this time. As the
Postal Service develops its plan to achieve compliance with these
rules, it will have other opportunities to bring concerns that can be
identified with specificity to the attention of the
[[Page 38729]]
Commission, and possibly to suggest less costly or burdensome
alternatives.
B. Objection to Quarterly Reports
The service performance rules incorporate a two-level system for
reporting service performance consisting of an Annual Report provided
at a high level of aggregation and four Quarterly Reports which provide
information at a more detailed level.
This two-tier approach was proposed by the Postal Service and
adopted by the Commission. It was discussed at several Postal Service/
Commission consultative meetings, where the statutory, 39 U.S.C.
3652(a)(2), product level reporting requirements also were reviewed
with the Postal Service. Section 3652(a) provides that the Postal
Service shall prepare and submit such reports as the Commission deems
necessary to demonstrate (among other things) that the quality of
service it provides complies with all applicable requirements of title
39. Section 3653(b) provides that the Commission shall make a
determination on whether service standards in effect during a year have
been met. The rules established by this order allow for both of these
related, but different, provisions to be met through two-tier
reporting.
The section 3653(b) requirement focuses on whether service
standards are met over the course of a year. Annual reporting of
service performance will enable the Commission to make these
determinations. The section 3652(a) requirement is broader, focusing on
such standards as the obligation to provide services to bind the nation
together and to provide prompt and reliable service to all areas. See
39 U.S.C. 101. To evaluate these requirements, the Commission has
determined that more detailed, quarterly information is necessary.
The Postal Service initially appeared to endorse this approach in
its service performance Plan:
In accordance with Sec. 3652 of the Postal Accountability and
Enhancement Act, the Postal Service is required to report measures
of the quality of service on an annual basis. The Postal Service's
proposal for service measurement goes far beyond annual reporting
and will instead provide quarterly reporting for all market-dominant
products, almost entirely at a district level.
Plan at 12.
The Postal Service now argues that the PAEA contemplates only
annual reporting of service performance and customer satisfaction, and
that the Commission is not authorized to require reports on a different
timeframe. It states that there is no reason why the Commission needs
quarterly service performance and customer satisfaction reports to
effectuate its responsibilities under title 39. Furthermore, it
contends that the Commission's authority is generally confined to
determining the contents of the annual report, and not the timing of
reports. The Postal Service acknowledges that the concept of quarterly
reports arose out of Postal Service proposals, but that was when the
Postal Service was proposing to report at the class, and not the
product, level. Finally the Postal Service contends that the
Commission's authority is significantly limited by 39 U.S.C.
3652(e)(1)(B) which requires the Commission to consider unnecessary or
unwarranted administrative effort and expense on the part of the Postal
Service. Postal Service Comments at 12-17; Postal Service Reply
Comments at 3-8.
The Public Representative contends that the section 3652 statutory
requirement to provide an annual report does not preclude the reporting
of data on a more frequent basis. It argues that the Postal Service's
objection to quarterly reporting of service measurements also is
inconsistent with the Postal Service's position on the reporting of
costs, revenues and rates under the existing periodic reporting rules.
Public Representative Reply Comments at 4-5. In addition, the Public
Representative argues that quarterly data are necessary for the
Commission to carry out its regulatory functions. Id. at 5-10.
If the Commission finds the Postal Service's arguments persuasive,
the Public Representative proposes two alternatives: (1) Either require
the quarterly service performance data proposed by the rules to be
provided as part of each annual report; or (2) require a report
encompassing the previous four quarters (annual) to be provided 4 times
a year (quarterly). Id. at 6. Valpak supports the Postal Service
position that neither 39 U.S.C. 503 nor 39 U.S.C. 3651 authorizes the
Commission to require quarterly reporting. It continues that although
the Postal Service is not prohibited from filing quarterly reports,
this also is not required by 39 U.S.C. 3652. Valpak argues that time is
better spent on improving the quality of reports by product on an
annual basis. Valpak Reply Comments at 1-2.
The Commission finds that prescribing the two-tier approach to
reporting service performance measurements is within the Commission's
statutory authority, provides information necessary to the Commission's
regulatory responsibilities, and is based on sound logic and reasoning.
The Commission has general authority to ``promulgate rules and
regulations and establish procedures, subject to chapters 5 and 7 of
title 5, and take any other action they deem necessary and proper to
carry out their functions and obligations'' pursuant to 39 U.S.C. 503.
Section III, Statutory Provisions, of this order thoroughly explains
how the proffered rules relate to the Commission's regulatory
responsibilities and need not be repeated at this point.
The two-tiered approach is intended to provide the appropriate
level of detail necessary to evaluate a product's overall service
performance for the purpose of an annual compliance determination. Too
great a level of detail could distract from this analysis by requiring
focus on potential anomalies in data that might not be relevant to a
product's overall performance.
The more detailed information provided quarterly is intended to
serve multiple purposes. Foremost, it will be used to verify the
information provided in the Annual Report, and to ensure that a
representative measurement system is in place which produces
statistically reliable data. Additionally, it will provide the
Commission with the level of detail necessary to carry out its other
regulatory functions, such as examining the interaction of level of
service with rate changes, which has rate cap implications, and in
evaluating universal service.
Alternatively, as proposed by the Public Representative, all annual
and quarterly data could be provided annually, i.e., one comprehensive
annual report providing information by quarter.\14\ This alternate
approach was not originally proposed, nor is it desirable. With a
single data intensive report, focus could be lost in evaluating annual
compliance. Compliance issues easily may arise concerning what amounts
to supporting data, rather than a product's overall performance.
Providing a separate Annual Report at the appropriate level of detail,
as proposed, provides a first level filter, which focuses the analysis
on more pertinent information to complete an annual determination of
compliance.\15\
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\14\ This fact substantially weakens the end result of the
Postal Service's new argument, as the rules could require the Postal
Service to provide identical information, either on an annual, or on
a quarterly basis.
\15\ Although the Commission intends to focus on annual data for
the Annual Compliance Determination, it finds no bar to using
quarterly provided information when reviewing any compliance issue
that may arise.
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The once-a-year all-inclusive approach also creates timeliness of
data
[[Page 38730]]
issues. Untimely service performance data quickly loses its relevance.
Timely, reliable data facilitates the Commission's ability to
effectively carry out its many regulatory functions, including review
of periodic rate change proposals and universal service analysis. This
information will facilitate the Commission's ability to make well-
informed decisions.
The Postal Service also argues that the Commission's authority is
limited, and must be balanced against the requirements discouraging
unnecessary or unwarranted administrative effort and expense on the
part of the Postal Service. As discussed previously, the Commission
requested that the Postal Service quantify unreasonable costs or
burdens when evaluating these rules. The Postal Service chose not to do
so with any reasonable level of specificity. For this reason the
Commission rejects this generalized and unsupported argument.
Finally, the Postal Service argues that because 39 U.S.C. 3652 only
specifically identifies an annual report, the Commission is without
authority to ask for more frequent reports. The Commission finds
nothing in the statute that prohibits the Commission from seeking more
frequent reports, if a regulatory need can be demonstrated. The
Commission discusses the regulatory need for quarterly reports
throughout this order. The Postal Service's narrow interpretation of
the statute to conclude that the Commission may seek information only
on an annual basis ignores the other functions this information plays
in the Commission's regulatory responsibilities under the PAEA, and
ignores the need to validate the data that are provided on an annual
basis.
C. Implementation of Rules
The Postal Service's comments inform the Commission of its current
ability to generate information as required by the rules. This includes
both a product-by-product measurement and reporting capability status,
and an estimate of what information may be provided in quarterly and
annual reports in the near term. After review of these comments, it is
evident that an implementation plan must be developed to ensure timely,
full compliance with the service performance reporting rules.
The Postal Service offers that the first annual report should be
provided with the FY 2010 Annual Compliance Report, with the
anticipation that exceptions to reporting will be necessary. It asserts
that it currently lacks the capacity to comply with certain parts of
the rules without modifications to its measurement systems.
Furthermore, the Postal Service states that the first quarterly report
likely will not be capable of reporting on large parts of the
information required by the rules. Postal Service Comments at 9-12; 29.
The Postal Service identifies its current abilities to comply with
detailed service performance reporting requirements. The Postal Service
asserts that it will be able to provide detailed annual and quarterly
reports for all First-Class Mail products, except for Flats.\16\ Id. at
29-30. The exception for the reporting of Flats data is due to
limitations with the existing External First-Class (EXFC) system. The
Postal Service asserts it will be able to report Flats at the national
and area levels for overnight, 2-day and 3/4/5-day service standard
groups, but it will not be able to report service performance down to
the district level as required by the rules. Id. at 31-32.
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\16\ One area of First-Class Mail where the Postal Service's
capability to report service performance exceeds the reporting
requirements of this rulemaking is in the area of Single-Piece
First-Class Mail International. The Postal Service reported Inbound
Single-Piece First-Class Mail International and Outbound Single-
Piece First-Class Mail International disaggregrated by overnight, 2-
day, and 3/4/5-day groupings during the FY 2009 annual compliance
review. This rulemaking currently requires reporting only a single
aggregated number for Inbound Single-Piece First-Class Mail
International and a single aggregate number for Outbound Single-
Piece First-Class Mail International. A future rulemaking will bring
the reporting requirements up to the level of actual reporting
capability. Until that time, the Commission requests that the Postal
Service continue reporting at the more disaggregate level on an
annual basis.
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The Postal Service asserts it will not be able to provide annual or
quarterly reports for Standard Mail by product. Id. at 29-31. This is
due to current electronic documentation requirements for full-service
IMb, which in some instances do not require detailed mailpiece level
data. Id. at 33. The Postal Service also asserts that currently there
is insufficient data to provide overall results at the national, area,
and district levels in the entry type and service standard groups
specified by the rules. Id. at 34.
The Postal Service asserts it will not be able to provide annual or
quarterly reports for Periodicals by product. Id. at 29-31. This is due
to limitations with the Red Tag/Del-Trak measurement systems. Id. at
35-36. However, the Postal Service may be able to separately report on
Destination Entry and End-to-End Periodicals at the class level. Id. at
36-37.
The Postal Service asserts it will be able to provide annual
Package Services reports by product, except for Bound Printed Matter
Flats and Media Mail/Library Mail (to the extent these products do not
utilize Delivery Confirmation), and Inbound Surface Parcel Post (at UPU
rates). Id. at 29. It also will be able to provide quarterly reports
for Package Services statistics by product, except for Inbound Surface
Parcel Post (at UPU rates). Id. at 31.
The Postal Service asserts it will be able to provide annual and
quarterly reports for some, but not all, Special Service products. Id.
at 30-31.
The Postal Service adds that full-service IMb has the capability to
provide granular data below the class level, with the limiting factor
being customer participation. However, rule changes to the measurement
system generally will require a 2 fiscal year time lag before
implementation, even assuming funding, availability of resources, and
no other competing priorities. Id. at 37-40.
The Public Representative acknowledges the Postal Service's
practical concerns as to the capabilities of the measurement systems to
produce reliable and representative service performance measurement
data in the short term. It suggests that this should be dealt with by
granting temporary exemptions from specific reporting elements until
such time as the measurement capabilities are more developed. Public
Representative Reply Comments at 3.
Mailers express an interest in having the Postal Service begin
providing service performance data in compliance with the rules as soon
as practicable. Bank of America suggests that the final rule contain an
effective date on which the Postal Service must comply with the rules.
Bank of America Comments at 6. PostCom/DMA urges the Commission to
require the Postal Service to develop and release interim and long-term
implementation plans for service performance measurement and reporting
systems. PostCom/DMA Comments at 6-8. PSA urges early implementation of
the rules for product level reporting and suggests that reporting begin
no later than Quarter 2, 2010 based upon existing systems. PSA Comments
at 2-3. PSA notes that the proposed rules focus on how performance
information is to be reported, and do not require significant changes
to the Postal Service's performance measurement approach. Id.
PostCom/DMA and MOAA express concern with Postal Service comments
that it may not be able to provide measurement statistics for Standard
Mail by product at any level required by the proposed rules. PostCom/
DMA Reply Comments at 2-4; MOAA Reply Comments at 1-2. PostCom/DMA
urges
[[Page 38731]]
the Postal Service to begin quarterly reporting at the product level to
the extent any data is available, and include explanatory notes as the
measurement systems continue to evolve. PostCom/DMA Reply Comments at
4. MOAA supports PostCom/DMA's suggestion to provide the maximum data
possible under existing systems, and argues that the Postal Service
should provide a schedule for full reporting under a reasonably rapid
timetable. MOAA Reply Comments at 1-2. MOAA asks the Commission to be
sensitive to the costs of providing this data. Id. at 2. Valpak also
suggests requiring a firm schedule for compliance with service
performance reporting by product for Standard Mail. Valpak Reply
Comments at 3-5. Valpak argues that if the Postal Service cannot begin
providing some data by product within the next 12 months, it would
endorse the PostCom/DMA suggestion that data be obtained by other
means, such as by using an alternative measurement system. Id. at 5.
The rules described in this rulemaking shall be effective 30 days
after publication in the Federal Register. There is no expectation that
the Postal Service will be able to provide service performance
reporting in compliance with every aspect of the rules as of the
effective date. In the case of customer satisfaction reporting,
however, there is no apparent reason why the Postal Service cannot
immediately comply with all customer satisfaction data reporting
requirements. Most, if not all, customer satisfaction reporting
requirements are based on information that the Postal Service currently
has available.
Because of the limited initial expectations in the area of service
performance reporting, the Commission shall require the Postal Service
to follow a two-step process to achieve full compliance with all
reporting requirements by the filing date of the FY 2011 Annual
Compliance Report (2011 ACR). The first step requires the Postal
Service to request semi-permanent exceptions from reporting as allowed
by rule 3055.3. These exceptions are applicable only under limited,
specific circumstances. The second step is to request temporary, short-
term waivers from reporting in areas where measurement and reporting
systems need additional time for development. This step further
requires the presentation of implementation plans to achieve full
compliance by the filing date of the 2011 ACR prior to the granting of
a waiver.
In the interim, the Postal Service is directed to provide the
Commission with all available required data as performance reports are
due. When additional data becomes available in the future, this also
shall be provided. Pending action on waivers or exceptions shall not
act as a stay to providing available data.
Step 1: semi-permanent exceptions from reporting. Rule 3055.3
allows the Postal Service to petition the Commission to request that a
product, or component of a product, be excluded from reporting. The
rules establish strict limits on allowable exceptions. Because of these
limitations, most instances that warrant an exception should be readily
identifiable and justifiable. It is anticipated that any exception
approved will be of a semi-permanent nature, as opposed to the
temporary, transitional waivers discussed below. Any request for
exception that is denied under rule 3055.3 may be further addressed by
requesting a temporary waiver until reporting can be provided. The
Postal Service shall file initial requests for exclusions from
measurement with the Commission no later than June 25, 2010.\17\
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\17\ The Commission requests that the Postal Service contact the
Comnmission's Dockets supervisor at the time of filing to establish
a new rulemaking ``RM'' docket for this filing.
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Public comments on the first round of requests will be accepted
until July 16, 2010. The Commission will issue a ruling shortly
thereafter. The public always has an opportunity to comment on any
exception, granted or not, during the Annual Compliance Report/Annual
Compliance Determination process.
Step 2: temporary waivers from reporting. The Postal Service's
recital of its immediate ability to comply with the service performance
reporting requirements indicates that a transition period is necessary
to allow further development of certain measurement and reporting
systems. The Commission will provide an opportunity for the Postal
Service to seek temporary waivers where it cannot immediately comply
with specific reporting requirements. Waivers will be granted for a
defined period of time, and will be applicable to any annual or
quarterly report required to be filed in the interim. The FY 2010
annual report and interim quarterly reports will be viewed in light of
these waivers.
As a condition of granting any waiver, the Commission shall require
the Postal Service to develop and present implementation plans
addressing each reporting requirement for which the Postal Service
cannot provide the required information. The plans shall conform with a
goal of achieving full compliance with all reporting requirements by
the filing date of the 2011 ACR. The Postal Service has been working on
its measurement systems since the passage of the PAEA in December 2006.
Requiring full compliance by issuance of the 2011 ACR provides almost 2
additional years for the Postal Service to implement reporting systems
to report service performance in full compliance with the rules.
Implementation plans at a minimum should provide an explanation of
why a reporting requirement cannot be complied with, the steps
necessary to come into compliance, and a timeline of events necessary
to achieve compliance. Interim milestones shall be included in the
plans where applicable such that both the Postal Service and the
Commission can evaluate progress being made. The Commission needs to be
informed of the Postal Service's plans and the progress being made, but
intends to provide the Postal Service the flexibility to manage its
plans without Commission interference.
The Postal Service's request for temporary waivers shall be filed
with the Commission no later than September 10, 2010.\18\ The Postal
Service shall provide status reports on achieving the milestones of its
implementation plans with the filing of quarterly performance reports.
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\18\ The Commission requests that the Postal Service contact the
Comnmission's Dockets supervisor at the time of filing to establish
a new rulemaking ``RM'' docket for this filing.
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The public has until October 1, 2010 to submit comments on requests
for temporary waivers. Comments directed towards areas of the Postal
Service's plans that are in jeopardy of not meeting the full compliance
deadline will be most helpful.
The Commission will issue a ruling shortly thereafter. For any
requests that may be unjustified or implementation plans that may
appear unreasonable, the Commission intends to direct the Postal
Service to make improvements to its plans or the request may be denied.
Interim reporting. This order provides illustrative examples of
data reporting charts for annual and quarterly service performance and
customer satisfaction reporting. The Postal Service may adopt these
formats, or independently develop similar formats, for reporting data.
All annual and quarterly reports shall be presented using complete data
reporting tables. Where data are available, it shall be provided. Where
data are not available, an appropriate notation shall be made where the
data should have appeared indicating that the data are not
[[Page 38732]]
yet available. This will provide a clear indication of the progress
being made towards full compliance with the reporting requirements.
D. Continuing Oversight
Many comments address the need for some form of continuing
oversight of service performance measurements by the Commission. Bank
of America encourages the Commission to provide ``an ongoing and active
role in ensuring timely, representative, and high quality reporting.''
Bank of America Comments at 6.
Valpak contends that implementing a service performance system is
an ongoing process, and suggests that the Commission revisit the
reporting rules after experience is gained, making adjustments as
necessary. Valpak Comments at 7-8. It further suggests planning for
subsequent discrete service performance measurement reporting dockets,
apart from the annual compliance review process where service
performance may take on a minor role. Valpak Reply Comments at 6-7.
Bank of America argues that mail prepared using full-service IMb
may not be representative of the product as a whole. Thus, it urges the
Commission to implement regular third-party auditing of service
performance measurement systems using IMb to ensure accurate and
representative measurements. Bank of America Comments at 7.
PostCom/DMA also expresses concern with the adequacy of full-
service IMb adoption rates to provide geographically and statistically
representative service performance measurements. They urge the
Commission to monitor adoption rates, and evaluate the related rate
incentive plans.\19\ PostCom/DMA Comments at 4-6.
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\19\ DMA believes that full-service IMb provides a low cost
solution for service performance measurement, but current incentives
are not high enough to elicit large enough quantities of mail for
the system to work. It argues for increasing the discounts to
increase volume, as opposed to funding an external measurement
system that does not rely on full-service IMb. DMA Reply Comments at
2. The Commission also is concerned with IMb adoption rates.
However, potential incentive plans are beyond the scope of this
order.
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Bank of America urges the Commission to review appropriate quality
control and data cleaning procedures, specifically in the area of
Confirm service. Bank of America Comments at 7. PostCom/DMA expresses
similar concerns. PostCom/DMA Comments at 14.
PostCom/DMA urges the Commission to establish a formal annual
review of service performance standards and targets with an eye towards
improving the standards and targets. Id. at 15-16.
Each of these arguments expresses concerns with the ability of the
hybrid IMb-based measurement system approved by the Commission to
provide reliable service performance measurements. The Commission has
an ongoing role in monitoring customer satisfaction and service
performance. Primary oversight will be through the Annual Compliance
Report/Annual Compliance Determination process. This is the appropriate
time to look at customer satisfaction and service performance,
including but not limited to all aspects of data quality, potential
auditing of systems, adequacy of the data being provided, sufficiency
of the measurement systems, monitoring of adoption rates, and proposals
for improvement.
Individual dockets may be initiated as required to consider
improvements to the rules as implemented, or to consider innovative new
approaches to evaluating both customer satisfaction and service
performance. Additional, continuous visibility into the Postal
Service's progress will be obtained through the quarterly reporting
requirements.
The Postal Service has established baseline service performance
standards and targets. The Commission has limited authority to
establish service performance standards and targets on its own, which
is implied by the PostCom/DMA suggestion to annually review the service
performance standards and targets with a goal of improvement. However,
the Commission will have an indirect role in reviewing Postal Service
initiated performance standard and target changes to these baselines as
this may affect the nature of the underlying service, or the rates
associated with the service in regard to the price cap.
V. Service Performance Measurements Reporting
A. Annual Reporting
This rulemaking incorporates the rules for annual reporting of
service performance measurements (or achievements) into new subpart A--
Annual Reporting of Service Performance Achievements, of Part 3055--
Service Performance and Customer Satisfaction Reporting. Table 2--
Illustrative Annual Report Data Reporting Charts shown in the Appendix
provides illustrative examples of data reporting charts.
Rules 3055.2, .3, .5 and .7 concerning the Contents of the Annual
Report of Service Performance Achievements; Reporting Exceptions;
Changes to Measurement Systems, Service Standards Service Goals or
Reporting Methodologies; and Special Study are the subject of
actionable comments, and are addressed below.\20\
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\20\ Order No. 292 at 14-18 describes all rules appearing in
subpart A. The descriptions have not been repeated in the final
order unless pertinent to the discussion.
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1. Rule 3055.2--Contents of the Annual Report of Service Performance
Achievements
Rule 3055.2 describes the contents of the annual report of service
performance achievements. Subsection (b) directs the reader to specific
reporting requirements applicable to each product within a specific
class or group. Subsections (c) through (g) direct the Postal Service
to describe the service standards, performance goals, measurement
systems, and statistical methodologies for each product. Subsection (h)
now requires an explanation where specific service standards are not
met. Subsection (i) requires the identification of each product, or
component of a product, granted an exception from reporting pursuant to
rule 3055.3, along with a certification that the rationale for
originally granting the exception remains valid. Subsections (j) and
(k) (proposed subsections (i) and (j)) in effect require the Postal
Service to demonstrate how it performs each aggregation/disaggregation
of data, both between and among the various reports, and over the
various timeframes. This would include providing volumes and other
weighting factors as necessary to perform the required calculations.
Objections to documentation requirements. The Postal Service
believes that the documentation requirements specified by rule 3055.2
(and similarly rules 3055.31 and 3055.32) are unnecessary, in major
respects unworkable, and should be eliminated. Postal Service Comments
at 22-28. The Postal Service's specific comments, however, only focus
on the description of the aggregation methodologies within and between
various reports as required by proposed rules 3055.2(i) and (j).\21\
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\21\ Although the Postal Service only specifically mentions the
aggregation methodologies within and between various reports as
required by proposed rules 3055.2(i) and (j), the Postal Service's
comments also could be interpreted to implicate the documentation
requirements of rules 3055.2(c) through (g). The Commission's
conclusions apply equally to proposed rules 3055.2(i) and (j), and
to rules 3055.2(c) through (g).
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The Postal Service contends that the requirements of proposed rules
3055.2(i) and (j) are akin to requirements seen under the previous
ratemaking regime,
[[Page 38733]]
and are ``overkill'' in the context of the PAEA where interested third
parties do not have to be provided with previous levels of due process.
Id. at 26. It argues that the requirements will create an unwarranted
financial burden for the documentation of some products, and for
certain other products, the Postal Service contends that the complexity
of the systems prevent providing documentation in the formats
anticipated by the rules. Id. at 26-27.
The Postal Service contends that some level of assurance should be
provided in the analysis because many of the calculations are performed
independent of the Postal Service by contractors. The Postal Service
also notes that assurance should be provided because, pursuant to 39
U.S.C. 3652(a), the Inspector General of the Postal Service is required
to conduct regular audits of the performance measurement systems.\22\
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\22\The Postal Service also expresses concern with public
disclosure of certain data that otherwise potentially could have
been packaged and sold to interested mailers, thereby depriving the
Postal Service of an additional revenue source. Id. at 28, n.16.
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As an alternative, the Postal Service suggests that it is always
available to the Commission to answer questions about the derivation of
estimates. As a second alternative, the Postal Service proposes to
submit a certification from a qualified auditor to attest to the
accuracy of the estimates. Id. at 22-28.
Bank of America and PostCom/DMA support the rules which require the
Postal Service to describe the measurement system for each product,
including the process used to aggregate data. Bank of America Comments
at 3; PostCom/DMA Comments at 13-14. However, PostCom/DMA also
expresses concern with additional costs, and suggests clarification of
what is to be provided, including addressing massive IMb data sets and
consideration of potentially sensitive data. Id.
The Commission previously described the intent of proposed rules
(i) and (j):
Subsections (i) and (j) of this section in effect require the
Postal Service to demonstrate how it performs each aggregation/
disaggregation of data, both between and among the various reports,
and over the various timeframes. The goal is to provide independent
parties the information necessary to be able to replicate the
aggregations/disaggregations made by the Postal Service between and
among the various reports, and over the various timeframes. For
example, this should include the ability to aggregate the data
provided in the quarterly reports up to the level of data provided
in the annual reports. It also should include the ability to
aggregate data provided at the District level, to the Postal
Administrative Area level, and to the National level. The Commission
expects that data will be provided in electronic format (Excel files
are anticipated at this time), with electronic links and formulas
that can be followed in order to duplicate the Postal Service's
aggregation methodologies. This would include providing volumes and
other weighting factors as necessary to perform the required
calculations.
Order No. 292 at 15 (footnote omitted).
The Commission finds that this requirement is a critical component
in allowing third parties to understand the data being presented by the
Postal Service. Without an understanding of this process, third parties
cannot properly interpret the service performance data, which renders
the data meaningless.\23\
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\23\ Bank of America provides an excellent example of the
effects of weighting on the presentation of data and a third-party's
ability to interpret the data. See Bank of America Comments at 3-4.
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The Commission assumes that the methodologies involved for service
performance measurements, including aggregation methodologies, is
information that the Postal Service or its subcontractors has available
and which has been documented. Otherwise, it would be difficult to
consistently apply these methodologies when analyzing and transforming
raw data into presentable form. It also would not be possible for any
third party (an independent auditor or the Inspector General of the
Postal Service as suggested by the Postal Service) to audit and verify
the Postal Service's systems without this documentation.
The Commission further assumes that the Postal Service did not
allow its contractors unconstrained latitude in developing performance
measurement systems. For the contractors to efficiently carry out their
tasks, they should have been provided with the parameters of the
systems that they were expected to deliver. In return, the contractors
should have provided documentation to the Postal Service explaining
what they had developed for the Postal Service. For these reasons, the
Commission concludes that documentation can be provided in compliance
with the documentation rule with little additional burden to the Postal
Service.
There is no single answer as to what may be a sufficient level of
documentation, or what level of underlying data must be presented in
support of the data filings. The Postal Service seems to indicate that
for certain products it is possible to provide complete documentation.
For other products, the Postal Service indicates that it will be
difficult, because of the complexities of the measurement systems, to
provide complete documentation. The Commission finds that the level of
documentation provided must be consistent with its previously stated
goals, and to allow parties to reasonably understand and analyze the
Postal Service performance measurement systems. The Commission only is
interested in the Postal Service's underlying raw data sets to the
extent necessary to understand how raw data is transformed into
presentable form. It expects generally to examine data sets that are
already in some aggregate form. The Commission is not asking that the
Postal Service's raw databases be made publicly available.
Assuming that the Postal Service is able to substantially comply
with documentation requirements, it still may be necessary to consult
informally with the Postal Service to understand more fully how its
systems operate. This potentially could include a series of technical
conferences to explain to all parties the performance measurement
systems. The Commission will make its staff available as necessary to
assist the Postal Service to determine how it can best comply with the
documentation requirements.
Alternative documentation proposal. The Public Representative
proposes that the Postal Service only fully document its service
performance measurement system in the first annual report after these
rules go into effect, instead of having to fully document its service
performance measurement system each year. He proposes that the Postal
Service then be required to document only changes to these systems in
future reports. He asserts this change mimics the reporting
requirements established under the existing periodic reporting rules
using the analytical principles concept. Public Representative Comments
at 7-9, and Attachment A, rules 3055.1(c) and 3055.2(e).
The Commission does not adopt the Public Representative's proposal.
The measurement and data reporting systems are in a nascent phase and
are currently under development. The Commission anticipates many
potentially significant changes over the next few years. It may become
extremely cumbersome to track these changes without establishing a new
baseline on an annual basis. The only additional burden placed upon the
Postal Service by this rule is the requirement to re-file, verbatim,
previously filed material where no changes have occurred. Once the
measurement and data reporting systems stabilize, this proposal may be
reconsidered.
Proposal to require explanations. Bank of America requests an
addition to
[[Page 38734]]
rule 3055.2 which requires the Postal Service to explain, in instances
where specific service standards are not met, why they are not met, and
to require the Postal Service to provide a plan for meeting service
standards in the future. Bank of America Comments at 3, n.7.
The Postal Service opposes this suggestion arguing that this is a
purpose of the Annual Compliance Report/Annual Compliance Determination
process. Postal Service Reply Comments at 34. It contends that the
Commission is authorized to seek additional information as might be
necessary at that time.
The Commission agrees with the Postal Service that the Annual
Compliance Report/Annual Compliance Determination process is the most
appropriate time for reviewing postal services that do not meet their
service standards or goals. The Postal Service also is correct in
recognizing that the Commission may seek this information if it is not
provided. However, this process will be facilitated by the Postal
Service providing explanations at the time it files its Annual
Compliance Report, and not waiting for a Commission request. Clarifying
rule 3055.2 to specify that providing explanations is required will
serve as a reminder to the Postal Service to provide this information
at the time of filing, and may eliminate the delay involved with
issuing information requests. Because this information should be
provided anyway, and if not it would be requested, the Commission does
not find this to be a material change to the proposed rule.
The following requirement will be added to rule 3055.2:
(h) For each product that does not meet a service standard, an
explanation of why the service standard is not met, and a plan
describing the steps that have or will be taken to ensure that the
product meets or exceeds the service standard in the future.
Minor wording change. The Public Representative proposes a minor
language change to clarify proposed rule 3055.2(i). He proposes to
change the word ``next'' to ``preceding'' when describing related
levels of aggregation/disaggregation. Public Representative Comments at
11-12, and Attachment A, rule 3055.2(i).
Although the Commission believes the intent of the rules is clear,
it finds that the language can be improved. The wording in rules
3055.2(j) and 3055.31(d) will be modified to read: ``Documentation
showing how data reported at a given level of aggregation were derived
from data reported at greater levels of disaggrgation.''
2. Rule 3055.3--Reporting Exceptions
Rule 3055.3 provides an avenue for the Postal Service to seek
exceptions from the general requirement to report on service
performance in instances where reports would be cost prohibitive in
relation to the revenue generated from the service, it defies
meaningful measurement, or in the case of certain negotiated service
agreements.
Clarification of ``component'' of a product terminology. The Postal
Service expresses several concerns with rule 3055.3 Reporting
exceptions. It asks clarification of the terminology ``component'' of a
product. It opines that this terminology could apply to the various
levels of aggregation required by the rules, or to the absence of
certain elements of required information for an entire product. Postal
Service Comments at 19.
Rule 3055.3 provides that ``[t]he Postal Service may petition the
Commission to request that a product, or component of a product, be
excluded from reporting * * * . The Commission had two applications in
mind for the terminology ``component of a product.'' The first applies
where ``component'' refers to a standalone service provided by the
Postal Service that is grouped under an umbrella product for
administrative purposes only. For example, Ancillary Services is a
product within Special Services. Stamped Cards would be a component of
the Ancillary Services product. The Postal Service may wish to seek an
exception from reporting on the Stamped Cards component of Ancillary
Services if it believes one or more of the exceptions are applicable.
The second is where ``component'' refers to a feature or service
provided as part of a recognized product. For example, the Single-Piece
Letters/Postcards product within First-Class Mail includes forwarding
and return service. Some have argued that forwarding and return service
should be independently measured. The Commission could consider
forwarding and return service a component of the Single-Piece Letters/
Postcards product susceptible to a request for exception from
reporting.\24\
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\24\ The Commission is not prejudging the success or failure of
making any of these arguments in obtaining an exception.
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Proposal to expand allowable exceptions. The Postal Service also
argues that the exceptions should be expanded in three ways: (1) To
apply to failure to meet the documentation requirements of rules 3055.2
and 3055.31; (2) to apply to reports on customer satisfaction; and (3)
to encompass the transition period when the Postal Service fails to
provide specific reports while the measurement systems are brought up
to speed. A further suggestion is to provide an ``other reasons''
catchall category of exceptions for items not specifically addressed.
Id. at 21.
The Commission intended only limited exceptions, and has not been
persuaded that additional exceptions should be provided. Temporary
waivers for near term failure to meet the documentation requirements or
events encountered during the transition period are addressed in the
discussion of an implementation plan in section IV.C. This speaks to
the Postal Service's immediate concern. The Commission is not aware of
any specific reason to extend reporting exception rules to the customer
satisfaction requirements. Most, if not all, customer satisfaction
reporting requirements are based on Postal Service systems already in
place, or from data that it routinely collects. The Postal Service has,
as it has frequently done in the past, the ability to formulate
requests for waivers in the form of a motion to address future issues
that may not be apparent at this time. The Commission does not find a
need to expand the exceptions rule at this time.
Exceptions procedures. Finally, the Postal Service comments that
the rules are silent on specific procedures for executing the exception
mechanism. The Postal Service's view is that the exceptions procedures
need not become a forum for any other purpose than permitting the
Postal Service to explain why reporting requirements are not being met.
Id. at 21-22. PSA contends that rule 3055.3 should include a provision
allowing interested parties to comment on proposed exceptions. PSA
Reply Comments at 3.
The Commission has concluded that it will seek comments and issue
an appropriate ruling on the initial round of exception requests. See
section IV.C. The Commission will reconsider if a more formal process
is warranted at a later date. Interested persons always have an
opportunity to comment on exceptions during the Annual Compliance
Report/Annual Compliance Determination process. Further opportunity for
interested persons to seek reconsideration of exceptions is provided
pursuant to 39 U.S.C. 3652(e)(2)(B).
3. Rule 3055.5-Changes to Measurement Systems, Service Standards,
Service Goals or Reporting Methodologies
Rule 3055.5 requires the Postal Service to apprise the Commission
of all
[[Page 38735]]
changes to measurement systems, service standards, service goals, and
reporting methodologies. The Commission may institute a proceeding to
consider change proposals if it appears that the changes might have a
material impact on the accuracy, reliability, or utility of the
reported measurement, or if the changes might have a material impact on
the characteristics of the underlying product.
Bank of America and PostCom/DMA voice general support for these
rules. Bank of America Comments at 3; PostCom/DMA Comments at 15.
Standard of review. The Public Representative contends that 39
U.S.C. 3652 requires the same standard of review for service
performance as it does for costs, revenues and rates. He equates
internal (including hybrid) service performance measurement systems and
methodologies for data reporting (including the use of proxies) with
analytical principles as defined in rule 3050.1 of the periodic
reporting rules. As such, the Public Representative proposes to
incorporate the more restrictive rules for changes in accepted
analytical principles into the rules for service performance. See 39
CFR 3050 et seq. The Public Representative also would extend the Postal
Service's advance notification requirement from 30 to 60 days, and
differentiate between internal and external measurement systems. Public
Representative Comments at 3-6, 9-11, and Attachment A, rules 3055.1(b)
and 3055.5.
The Postal Service opposes the Public Representative's proposal
arguing that the Commission's approach is both adequate and
appropriate. Postal Service Reply Comments at 15-18.
The periodic reporting rules, along with the concept of
``analytical principles,'' are intended for reporting on technical
areas of rate analysis which have evolved over 30 years. Over this time
the associated data measurement systems, analytical methodologies, and
forms of data presentation have matured and become fairly stable.
Recent changes to analytical principles typically account for recent
changes in the data reporting systems, or are meant to incorporate new
ways of looking at information generated through these systems.
By contrast, the periodic reporting of service performance is a new
requirement of the PAEA. The data measurement systems, analytical
methodologies, and forms of data presentation are currently under
development and are, for practical purposes, untested. Many adjustments
are anticipated before these systems become mature. At this early
stage, the Postal Service must have the flexibility to take the lead in
developing these systems. While the Commission does not intend to
insert itself into the day-to-day development decisions, it still must
be kept apprised of changes to proposed systems to ensure that they
produce and report reliable, useful information. 39 U.S.C. 3652(a)(1).
The Commission finds that the rules as proposed serve this function.
Thus, the Commission does not adopt the proposal to impose the more
restrictive periodic cost reporting procedures in the case of service
performance measurements at this time.
Commission oversight of service standards and service goals. The
Postal Service opposes the portions of rule 3055.5 which imply that the
Commission has limited oversight over service standards and service
goals. By statute, it argues that 39 U.S.C. 3691 reserves to postal
management all authority over the establishment or revision of service
standards, and uncodified section 302 provides postal management
authority to establish service goals. It asserts that these areas are
core management functions. Id. at 18-22.
The Commission does not intend to specify service standards or
service goals for new products, or, on its own, to initiate review of
existing products with the purpose of requiring changes to established
service standards or service goals. However, the Postal Service's
authority in this area is not without limit. Accurate, up-to-date
information is necessary for the Commission to carry out its
responsibilities to monitor and report on quality of service under the
PAEA. This only can be accomplished if the Postal Service provides
notice and continuously keeps the Commission apprised of all changes.
The Commission also finds that service performance standard or goal
changes that might have a material impact on the characteristics of an
underlying product must be reviewed for possible product classification
change issues. They also must be reviewed for rate and rate cap
implications. For example, a reduction in service without a reduction
in price may imply that customers are getting less for their money,
i.e., experiencing a de facto rate increase. The review of rate changes
and establishing rules that delineate how such cases are to be
considered by the Commission are well within the purview of the
Commission. See 39 U.S.C. 3622. The Commission's rules of practice are
clear when the Postal Service directly proposes rate changes, but may
be less clear when rates that are in effect are changed indirectly.
Providing (1) a notice requirement, and (2) establishing the
possibility of a proceeding in rule 3055.5 to remove any ambiguity that
the Postal Service must officially notify the Commission of Postal
Service actions that may indirectly affect rates.\25\
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\25\ A parallel argument can be made for when a service goal or
service standard changes the nature of a product, that effectively
amounts to a classification change.
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Minor wording change. Upon review of the wording of rule 3055.5,
the Commission determined that it may be unclear as to when the
Commission may initiate a proceeding. For clarity, the Commission will
add the words ``at any time'' to the rule. This is consistent with
Commission authority to initiate proceedings at any time pursuant to 39
U.S.C. 3652(e)(2), and authority to establish modern rate regulation
pursuant to 39 U.S.C. 3622.\26\ In some instances, it parallels a
customer's ability to file a complaint pursuant to 39 U.S.C. 3662,
request a proceeding pursuant to 39 U.S.C. 3652(e)(2), or provide
comment pursuant to 39 U.S.C. 3653(a). In some instances, it parallels
the Postal Service's obligation to file a nature of service case
pursuant to 39 U.S.C. 3661. However, the Commission's intent is to make
a preliminary determination of whether or not a proceeding is warranted
within the 30-day notification period, and notify the Postal Service
immediately of any determinations to initiate a proceeding.
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\26\ The Commission views service standard and service goal
changes as potentially affecting the value of a service to the
customer. Thus, service standard or service goal changes may be
equated wtih rate changes.
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4. Rule 3055.7-Special Study
The measurement systems that the Postal Service propose do not
appear to capture certain information on delivery performance; for
example, from the processing facility in Anchorage, Alaska to the outer
reaches of Alaska; from Honolulu to the neighbor islands of Hawaii; or
from San Juan to more distant locations in the Caribbean district.
Proposed rule 3055.7 contemplates the Postal Service conducting a
special study, every 2 years, to evaluate final delivery service
performance in these remote locations.
The Postal Service contends that a special study is not necessary
because transit time measurements already include single-piece, bulk,
and international First-Class Mail, Standard Mail, and Package Services
to and from
[[Page 38736]]
all ZIP Codes in these areas. Parcels having Delivery Confirmation are
currently measured from start-the-clock through delivery to final
destination. Finally, Periodicals measurements will be extended to
these areas when the hybrid measurement approach replaces the Red Tag/
Del-Trak measurement system. Postal Service Comments at 44-45.
The intent of obtaining special studies is to allow evaluation of
the unique aspects of providing service to the less populous/more
remote areas of these districts, and compare how this service differs
from the districts as a whole. Beyond the service performance
implications, this will add to the understanding of universal service
in these areas. The Postal Service states it now is able to measure all
ZIP Codes in these areas. This may provide the necessary information
for the special study. However, if the intent of the Postal Service was
only to aggregate information obtained from these ZIP Codes to obtain a
district level result, this would not provide the insight as required
into the unique aspects of service to the less populous/more remote
areas.
The special study shall remain in the final rule. If the result of
the special study indicates that the more remote/less populous areas of
these districts receive essentially the same service as the less
remote/more populous areas of these districts, the Postal Service may,
in the future, petition the Commission to eliminate this requirement
from future reports.
B. Quarterly Reports
This rulemaking incorporates the rules for quarterly reporting of
service performance measurements into a new Subpart B--Periodic
Reporting of Service Performance Achievements, of Part 3055--Service
Performance and Customer Satisfaction Reporting. Table 3--Illustrative
Quarterly Report Data Reporting Charts shown in the Appendix provides a
visualization of the quarterly data reporting elements specified by the
rules through illustrative examples of data reporting charts.
Rules 3055.31, .32 and .50 concerning the Contents of the Quarterly
Report of Service Performance Achievements; Measurement Systems Using a
Delivery Factor; and Standard Mail are the subject of actionable
comments, and are addressed below.\27\
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\27\ Order No. 292 at 19-23 describes all rules appearing in
subpart B. The descriptions have not been repeated in the final
order unless pertinent to the discussion.
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1. Rule 3055.31--Contents of the Quarterly Report of Service
Performance Achievements
Rule 3055.31 specifies the contents of each quarterly report.
Subsection (b) directs the reader to specific reporting requirements
applicable to each product within a specific class or group. Subsection
(c) requires identification of each product, or component of a product,
granted an exception from reporting pursuant to rule 3055.3, along with
a certification that the rationale for originally granting the
exception remains valid. Finally, subsections (d) and (e) direct the
Postal Service to demonstrate how it aggregates/disaggregates data to
different reporting levels.
Aggregation of data. Bank of America supports the demonstration of
the aggregation of data, rule 3055.31(d)-(e). Specifically, Bank of
America stresses the importance of weighting to allow meaningful
analysis of data, and the impact that weighting has on reported
performance. Bank of America Comments at 3-4.
The Postal Service contends that the documentation requirements
specified by rule 3055.31 should be eliminated, arguing that it is
unnecessary and in major respects unworkable.\28\ See Postal Service
Comments at 22-28.
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\28\ The Postal Service's specific arguments objecting to rule
3055.31 are incorporated into its arguments objecting to rule 3055.2
and are addressed in the discussion of rule 3055.2.
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The Commission previously addressed this issue when discussing rule
3055.2 and did not find the Postal Service's arguments persuasive. The
rule shall not be modified based on the Postal Service's arguments.
Minor wording change. The Public Representative proposes the same
minor language change to add clarity to rule 3055.31(d), as he proposed
for rule 3055.2(j). In both places, he proposes to change the word
``next'' to ``preceding'' when describing related levels of
aggregation/disaggregation. Public Representative Comments at 11-13,
and Attachment A, rules 3055.2(j) and 3055.31(d).
The Commission previously found that the clarity of these rules can
be improved. Consistent with the wording modifications to rule
3055.2(j), the Commission also modifies rule 3055.31(d) to read:
Documentation showing how data reported at a given level of
aggregation were derived from data reported at greater levels of
disaggregation. Such documentation shall be in electronic format
with all data links preserved. It shall show all formulas used,
including volumes and other weighting factors.
2. Rule 3055.32--Measurement Systems Using a Delivery Factor
Rule 3055.32 requires the Postal Service to independently report
delivery factors when used in computing End-to-End service performance.
The Postal Service contends that the documentation requirements
specified by rule 3055.32 should be eliminated arguing that it is
unnecessary and in major respects unworkable.\29\ See Postal Service
Comments at 22-28.
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\29\ The Postal Service's specific arguments objecting to rule
3055.32 are incorporated into is arguments objecting to rule 3055.2
and are addressed in the discussion of rule 3055.2.
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The Commission previously addressed this issue when discussing rule
3055.2 and did not find the Postal Service's arguments persuasive. The
rule shall not be modified based upon the Postal Service's arguments.
3. Rule 3055.50--Standard Mail
Rule 3055.50 specifies the quarterly reporting requirements for all
products within the Standard Mail class.
Destination Entry service standard day groupings. The Postal
Service established 2-day through 10-day service standards for
Destination Entry Standard Mail. The proposed rule separates
Destination Entry mail into two groups for reporting purposes. It
proposes reporting an aggregation of mail subject to the 2-day through
4-day service standards and an aggregation of mail subject to the 5--
day through 10-day service standards. Destination Entry 2-day through
4-day service standard mail roughly coincides with destination delivery
units (DDU) and destination sectional center facility (DSCF) entered
mail. Destination Entry 5-day through 10-day service standard mail
roughly coincides with destination bulk mail center (DBMC) and bulk
mail center (BMC) entered mail.
Valpak proposes slightly different Standard Mail day aggregations
for Destination Entry mail. It contends that its proposal makes the
reporting of Destination Entry mail more meaningful. It proposes
separate reporting of 2-day mail which roughly reflects DDU-entered
mail, aggregating 3- to 4-day mail which roughly reflects DSCF-entered
mail, and aggregating 5- to 10-day mail which roughly reflects DBMC-
and BMC-entered mail.
Valpak also proposes an alternative in case its preferred
aggregations prove impossible or too costly to implement. It proposes
aggregating 2- to 3-day mail which reflects all DDU-entered mail and
over 99 percent of all DSCF-entered mail, and aggregating 4- to 10-day
mail which reflects DBMC and remote
[[Page 38737]]
destinating mail entered at the appropriate BMC, plus any DSCF Virgin
Islands mail. Valpak Comments at 6-7.
PostCom/DMA also proposes different Standard Mail day aggregations
for Destination Entry mail. It proposes aggregating the 2- to 5-day
mail and aggregating the 6- to 10-day mail. PostCom/DMA Comments at 12.
The Postal Service appears to support the rule as proposed. It
contends that increasing the number of reporting groups could have a
negative effect on the representativeness of the underlying data, and
the statistical validity of the reported result. Postal Service Reply
Comments at 27-29.
The Commission adopts Valpak's proposal which separates reporting
of 2-day mail, 3- to 4-day mail, and 5- to 10-day mail. Valpak's
proposal improves upon the Commission's proposal in the notice of
rulemaking by effectively providing separate reporting for BMC (now
network distribution center (NDC))- and DSFC-entered mail. The
Commission acknowledges the Postal Service's concerns about the
representativeness of data and statistical validity. However, this is a
concern regardless of which proposal is adopted, and a final resolution
of appropriate aggregations will not be possible until measurement and
reporting systems are further developed, and actual mail volumes are
considered.
End-to-End service standard day groupings. The Postal Service
established 3-day through 22-day service standards for End-to-End
Standard Mail. The proposed rule separates End-to-End mail into two
groups for reporting purposes. It proposes reporting an aggregation of
mail subject to the 3-day through 5-day service standards and an
aggregation of mail subject to the 6-day through 22-day service
standards. End-to-End 3-day through 5-day service standard mail roughly
coincides with sectional center facility turnaround, area distribution
center turnaround, and intra-BMC area mail. End-to-End 6-day through
22-day service standard mail roughly coincides with all other End-to-
End mail subject to greater transportation needs.
PostCom/DMA proposes slightly different End-to-End Standard Mail
day aggregations. It proposes aggregating 3- to 5-day mail, aggregating
6- to 10-day mail, and aggregating 11- to 22-day mail. This is designed
to improve the visibility of non-contiguous United States mail, monitor
performance due to NDC changes, and monitor the broader Postal Service
network through the four Tier 3 NDCs. PostCom/DMA Comments at 12.
The Postal Service's comments presented above for Destination Entry
mail apply equally to End-to-End mail. Postal Service Reply Comments at
27-29.
The Commission adopts the PostCom/DMA proposal which separates
reporting of 3- to 5-day mail, 6- to 10-day mail, and 10- to 22-day
mail. This proposal effectively provides increased visibility for mail
coming to and going from the contiguous United States, and is an
improvement over the aggregations proposed in the notice of rulemaking.
The same caveats apply concerning the representativeness of data, and
statistical validity of the service performance measurement process.
Aggregating service standard days. PostCom/DMA and Valpak ask the
Commission to clarify which service standards are applicable to the
data that is being aggregated. PostCom/DMA Comments at 12; Valpak
Comments at 4-5.
PostCom/DMA correctly assumes that when aggregating a range of days
for reporting purposes, mail for each individual day will be measured
against that day's standard, and not against the maximum standard of
the group. See PostCom/DMA Comments at 12. For example, a single number
will be reported for 3- to 4-day service standard Destination Entry
mail. All 3-day service standard mail will be measured individually and
compared with respect to the 3-day service standard. All 4-day service
standard mail will be measured individually and compared with respect
to the 4-day service standard. The 3-day result then will be combined
with the 4-day result, weighted by an appropriate factor, and reported
as the result for 3- to 4-day service standard Destination Entry mail.
Three-day service standard mail will not be measured with respect to a
4-day service standard.
A similar process will be used for reporting on all products that
have multiple service standard days. The process is applicable to both
on-time service performance measurements and mail service variance
reports. If reported using the illustrative data tables appearing in
the Appendix, this single number would be reported in the ``%
On-Time'' column. For annual reports, this number will be compared
against the ``Target,'' which is the service goal, not the service
standard. See Valpak Comments at 9.
4. Rule 3055.65--Special Services
In Order No. 292, the Commission proposed an approach to measuring
the service performance of green card Return Receipt service within the
Special Services, Ancillary Services product. Order No. 292 at 26-28.
Requirements specifying the form for reporting these measurements were
incorporated into proposed rule 3055.65(b). The Postal Service was
directed to respond to these proposals.
The Postal Service's response informs the Commission that it will
incorporate the requirements proposed by the Commission into a special
study concerning green card Return Receipt service that it intends to
undertake in FY 2010. Postal Service Comments at 43-44.
The Commission will review the Postal Service's special study
methodology and initial results during the FY 2010 Annual Compliance
Report/Annual Compliance Determination process.
C. Proposals to Expand the Scope of the Service Performance Rules
Forwarding and return of First-Class Mail. In Order No. 140, the
Commission asks the Postal Service to explore the cost of periodically
conducting studies of service performance for forwarded and returned
First-Class Mail, and to consider whether it is possible to incorporate
pieces delivered to post office boxes and pieces requiring forwarding
and return into its current EXFC measurement system design. Order No.
140 at 21, 24.
In response, the Postal Service concludes that it is not feasible
to use EXFC, and that estimated costs and challenges stand as
compelling barriers to the development of special studies to measure
forwarding and return performance.\30\ See Postal Service Supplemental
Comments.
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\30\ Additionally, the Postal Service contends it ``does not
consider that section 3691 can fairly be read to impose any
obligation to establish service standards of measurement reporting
for mail within a product on the basis of it being subject to one or
a variety of applicable mail flows or processing technologies, or
whether such mail is forwarded, returned to sender or subject to
different modes address correction.'' Postal Service Supplemental
Comments, Attachment at 1, n.1. The Commission respectfully
disagrees with the Postal Service's interpretation. It might lead to
the conclusion that only one performance characteristic could be
measured for each product. The Postal Service itself recognized that
this is not the case. It proposes separate reporting within Standard
Mail for destination entry and End-to-End mail due to differences in
mail flows. Within First-Class Mail, rational arguments can be made
for measuring forwarded and returned mail separately from properly
addressed mail, as opposed to the Postal Service's approach of
excluding this segment of First-Class Mail from measurement or
alternatively to include this mail in overall First-Class Mail
product reporting.
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In the instant docket, the Public Representative again suggests
including service performance reporting of forwarded First-Class Mail.
Public
[[Page 38738]]
Representative Comments at 15-17. He submits that the Postal Service
has a statutory obligation to measure the service performance of this
mail. He further requests that the Postal Service be directed to
measure service performance using EXFC, special studies, or a
combination of the two. Alternatively, the Public Representative asks
that the Postal Service provide partial measurements by capturing
existing operational data. Public Representative Supplemental Comments
at 2.
At this time, the Commission will not require reporting on
forwarded or returned mail. The Commission likely will revisit this in
the future because forwarding and return is an important characteristic
of First-Class Mail which affects the service performance of each
product within that class. At that time, the Commission will find it
helpful for the Postal Service to attempt to develop ideas for
attaining meaningful measurements instead of focusing on potential
impediments to doing so.
Tail of the Mail. Bank of America and PostCom/DMA suggest reporting
mail service variances as a cumulative percentage of mail delivered
each day for mail exceeding their respective service standards until 99
percent of the mail entering the system is accounted for. Bank of
America Comments at 3, n.5; PostCom/DMA Comments at 9-10. The variance
reports as proposed generally only provide data on the percentages of
mail delivered within 1 day, 2 days or 3 days of the applicable service
performance standard.
The Commission addressed this issue in Order No. 140 at 43-44,
where it did not recommend expanding variance reporting beyond the 1-
day, 2-day, and 3-day reporting as proposed by the Postal Service.
Although the Commission recognizes potential benefits to mailers of
more detailed reporting, the Commission remains unconvinced of a need
to provide variance reporting beyond the proposed 3 days to fulfill its
regulatory functions. Reporting at the 1-day, 2-day, and 3-day level
should provide an indication of the Postal Service's consistency in
meeting its service performance requirements, and provide an indication
of potential tail of the mail problems. However, this issue is subject
to re-evaluation once measurement systems begin generating actual data
and specific problems are identified.
Remittance mail. Bank of America argues that the Postal Service
should measure and report service performance for remittance mail
containing payments separately from other First-Class Mail. Bank of
America Comments at 4-5.
The Postal Service opposes this suggestion arguing that neither the
statute nor the proposed rules require reporting of service performance
at a subproduct level. The Postal Service also agrees with the
Commission's position expressed in Order No. 140 which does not require
the separate reporting of remittance mail. Postal Service Reply
Comments at 34-35.
The Commission expressed its position in Order No. 140.
The Commission distinguishes separate reporting of remittance
mail from treating remittance mail as a distinct category of First-
Class Mail. The Postal Service has indicated to the Commission in
consultations that it is considering ways to separately measure the
performance of remittance mail, which indicates a future potential
for separate reporting of remittance mail. However, treating
remittance mail as a distinct category of First-Class Mail raises
classification issues that are beyond the scope of this discussion.
Order No. 140 at 146.
The rules will not be modified at this time to require the separate
reporting of remittance mail from other First-Class Mail.
Critical Entry Times (CETs). Bank of America suggests expanding
rule 3055.2 to report on CETs, and to subject CETs to the change notice
provisions of rule 3055.5. Bank of America Comments at 3, n.7.
The Postal Service approves of the Commission's conclusions reached
in Order No. 140 at 17. It believes that requiring reporting of CETs
would amount to an inappropriate and unauthorized intrusion on the
management function. Postal Service Reply Comments at 33.
The Commission expressed its position in Order No. 140.
The Commission perceives start-the-clock as a detailed and
difficult issue, and urges the Postal Service to continue working
with the mailing community in developing a working, user friendly,
information system. The Commission supports the Postal Service's
proposal to document CETs and encourages it to develop systems to
make this information publicly available in the very near future.
Order No. 140 at 17.
The Commission accepts the Postal Service's representation that it
will document CETs on a facility-by-facility basis in a central
location. Unless it is shown that CETs are being unreasonably
manipulated to influence the performance measurement system, the Postal
Service needs the flexibility to establish CETs based on its business
requirements. Subjecting CETs to the notice provisions of rule 3055.5
now would needlessly restrict this flexibility. Individual CETs do not
have to be reported to the Commission.
Actionable, raw data. Bank of America and PostCom/DMA argue that
they have business needs for service performance reporting beyond what
the Commission requires to perform its regulatory function. Bank of
America suggests that the Commission encourage the Postal Service to
provide mailers access to aggregate raw data. Bank of America Comments
at 2. PostCom/DMA also contends that customers have a need for access
to actionable service performance data. PostCom/DMA Comments at 8-9.
The Commission is not persuaded to modify its previous position on
this topic.
The Commission observes that business needs of some mailers may
vastly exceed the needs of the regulator to perform its functions.
Although the Commission may well specify reporting in a greater
level of detail over time, it is not anticipated that the level of
reporting will reach the provision of near real time data envisioned
by some mailers. The Postal Service should be allowed time to
explore the business needs of its customers and propose information
products to meet those needs outside the context of the regulatory
requirements.
Order No. 140 at 42.
Year-to-year comparisons. Valpak suggests a requirement for the
Postal Service to provide year-to-year comparisons of data. For
example, percentage on-time (last year) data could be compared with
percentage on-time (current year) and a percentage on-time change could
be calculated. Valpak Comments at 10.
All data will be available for interested persons to make
comparisons of their own choosing. The Postal Service may choose to
make comparisons in its reports to the Commission if it finds a
comparison style format helpful. However, until experience is gained
with the reporting of service measurement data, the Commission will not
require the Postal Service to provide year-to-year comparisons.
Improving the transparency of service performance information.
PostCom/DMA express frustration with the form and content of service
performance information the Postal Service posts on its Web site. They
ask the Commission to work with the Postal Service to improve the
transparency and accessibility of service standards, service
performance targets, and service performance reports. PostCom/DMA
Comments at 16-17.
The Postal Service controls what it posts to its Web site. The
Commission can only suggest that the Postal Service
[[Page 38739]]
work with its customers in improving the quality and usefulness of the
information it posts. The Commission, however, will post all public
sections of both annual and quarterly service performance and customer
satisfaction reports to its Web site as they are filed by the Postal
Service. This will improve the transparency of the reporting systems
and will provide more detailed information than what currently is
posted on the Postal Service's Web site.
Including variance reports in the Annual Report. Valpak contends
that 39 U.S.C. 3652(a)(2)(B)(i) requires annual variance reports as a
measure of a product's reliability. It asserts that providing this
information is a Postal Service statutory requirement that the
Commission cannot waive even though the Commission is capable of
compiling this report using information obtained through quarterly
reports. Valpak Comments at 14-17.
The Postal Service suggests that this information potentially could
be provided as part of the annual report. Postal Service Reply Comments
at 27.
The rules as adopted require the provision of variance reports as
part of each quarterly report, but not as part of the annual report.
The proposed quarterly reporting rules also require the Postal Service
to aggregate quarterly reports up to an annual level. Thus, Valpak will
have access to the information it seeks under the rules as proposed.
Both quarterly reports and the annual report will be available for
analysis under the Annual Compliance Determination process. Under these
circumstances there is no reason to require the separate entry Valpak
seeks.
VI. Reporting of Customer Satisfaction
A. General Considerations
This rulemaking incorporates the rules for reporting customer
satisfaction into new Subpart C--Annual Reporting of Customer
Satisfaction, of Part 3055--Service Performance and Customer
Satisfaction Reporting. Table 4--Illustrative Customer Satisfaction
Data Reporting Charts shown in the Appendix provides a visualization of
the annual data reporting elements specified by the rules through
illustrative examples of data reporting charts.\31\
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\31\ Order No. 292 at 29-34 describes all rules appearing in
subpart C. The descriptions have not been repeated in this order
unless pertinent to the discussion.
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Rule 3055.90 specifies the general requirement for the Postal
Service to file a report on customer satisfaction as part of its Annual
Compliance Report unless more frequent reporting is specifically
requested. See 39 U.S.C. 3652(a)(2)(B)(ii).
The Postal Service comments generally that 39 U.S.C.
3652(a)(2)(B)(ii) provides little guidance on Congressional intent
regarding what would constitute appropriate reports on customer
satisfaction. Nevertheless, the Postal Service contends that the rules
as proposed go further than necessary, intrude upon matters more
appropriately left to postal management, and may exceed the intended
statutory authority for the Commission to specify such reporting.
Postal Service Comments at 45-47.
The Commission also recognizes that little guidance is provided by
statute concerning the measurement of customer satisfaction and the
relationship of customer satisfaction to other aspects of the statute.
However, the Commission disagrees that the rules go further than
necessary or intrude upon postal management. Congress clearly intended
the Commission to have a role in both considering and improving
visibility into customer satisfaction, as evidenced by Congress
including the statutory provisions concerning customer satisfaction in
the PAEA. This includes the development of reporting requirements
concerning this new and relatively unexplored area through the current
rulemaking process.
B. Rule 3055.91--Consumer Access to Postal Services
Rule 3055.91 requires the Postal Service to provide information
encompassing four areas of customer access. First, it requests
information on the number, type, and status of post offices servicing
the public. Second, it seeks information pertaining to the number and
type of delivery points accessed by the Postal Service. Third, it
requests information pertaining to the number of collection boxes
accessed by the Postal Service. Finally, it seeks information on
customer wait time in line for retail services.
The Postal Service contends that reporting of consumer access as
required by rule 3055.91 does not provide direct evidence of customer
satisfaction, falls outside the scope of information Congress intended
the Postal Service to report, and is outside the scope of information
the Commission is authorized to require in reports on quality of
service. Thus, it contends that the provisions specified in rule
3055.91 should be eliminated. Id. at 50-51.
Valpak contends that requiring the Postal Service to report on
consumer access to postal services as part of measuring the degree of
customer satisfaction lacks statutory basis and should be
withdrawn.\32\ It argues that the information sought does not relate to
how customers feel about postal services and can only be used by the
Commission to ``attempt to determine how the Commission feels that
consumers might feel.'' Valpak Comments at 17-18.
---------------------------------------------------------------------------
\32\ Its argument is directed at the requirements to report on
post offices, delivery points, and collection boxes, but not towards
the requirement to report wait time in line.
---------------------------------------------------------------------------
The Public Representative contends that data on customer access and
Mystery Shopper Program information are important measures of customer
satisfaction and service quality, even if they are indirect measures.
He argues that the requirement to report on consumer access to postal
services is directly responsive to Congressional intent in establishing
modern service standards to ``preserve regular and effective access to
postal services in all communities, including those in rural areas or
where post offices are not self-sustaining.'' See 39 U.S.C.
3691(b)(1)(B). Public Representative Reply Comments at 10-12.
The Commission agrees with the Postal Service that the data
required by the customer access rule does not provide a direct
indication of customer satisfaction. However, it finds that several of
these reporting requirements are relevant to an analysis of customer
satisfaction. For example, if a customer cannot access a needed postal
service, that customer cannot be satisfied with that service. At some
point, access may become so limited that service is effectively
unavailable. Quantifying specific modes of customer access is a first
step in the analysis, which asks what level of access is available.
Information quantifying post offices, delivery points, and collection
boxes should be readily available to management and can be provided
with little burden. Changes in the levels of access over time then can
be correlated with customer satisfaction. The Commission finds that
measuring customer access to postal services is likely to be an
important aspect of customer satisfaction, as well as a critical aspect
of evaluating universal service. Thus, the Commission shall retain the
customer access provisions in the final rule.
In Docket No. N2009-1, the Postal Service provided information on
alternative access channels for obtaining postage and certain postal
services. The Postal Service provided percentages of revenues obtained
through various ``brick and mortar'' and alternative
[[Page 38740]]
access channels,\33\ and a comparison of products that can be purchased
in brick and mortar facilities and products that can be purchased
online.\34\
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\33\ Docket No. N2009-1, Responses of United States Postal
Service Witness VanGorder to Public Representative Interrogatories
PR/USPS-T1-1-5, and 7(c-d), 8, July 27, 2009.
\34\ Docket No. N2009-1, United States Postal Servce Notice of
Errata in Filing of Response of Witness VanGorder to Public
Representative Interrogatory PR/USPS-T1-1(a) [Errata], July 28,
2009.
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In Order No. 292, the Commission concluded that the Postal Service
may find that reporting of information on alternative access channels
will provide a more balanced view of the current status of customer
access to postal services, and that such reports also may provide
another avenue to promote the use of alternative access channels. The
Commission sought comments on the benefits of reporting this aspect of
customer access and any proposal that the Postal Service may have on
what and how any related data items can be reported.
The Commission did not receive responsive comments addressing this
subject. The Commission eventually may want to expand evaluation of
different types of access to postal services, but it shall not
establish reporting requirements on alternative access channels in this
rulemaking.
The Postal Service specifically asks the Commission to delete the
requirement to report wait time in line as required by rule 3055.91(d).
It contends that this measurement would not necessarily allow one to
draw particular conclusions about customer satisfaction. Furthermore,
wait time in line (as a component of the Mystery Shopper Program)
should remain within the purview of the Postal Service as an internal
management diagnostic tool. Postal Service Comments at 56-57.
If the Postal Service's concern is with the confidentiality of the
Mystery Shopper Program data, the Commission is not requiring the
Postal Service to use data from this program to develop wait time in
line statistics. The Postal Service may develop an independent system
for generating data. However, the Commission is of the opinion that
using Mystery Shopper Program data as the basis for reporting wait time
in line would be the most economical for the Postal Service.
The Commission infers from previous Postal Service presentations
that the Postal Service has determined an acceptable wait time in line
is less than 5 minutes. If the Postal Service has any studies that it
could share with the Commission which sheds light on a customer's
perception of wait time in line, the Commission would find those
studies most helpful. This will help the qualitative aspect of
analyzing wait time in line as it relates to customer satisfaction.
The Postal Service asks for clarification of rule 3055.91(a)
pertaining to reporting the number of post offices. The explanatory
note contained in Order No. 292 specifies that the responsive
information must be ``disaggregated by the types of post offices as
appearing in the Postal Service's Annual Report.'' Order No. 292 at 30.
The Postal Service explains that the disaggregation in the annual
report is by facility type, not by types of post offices. These are
Post Offices, Classified Stations, Branches and Carrier Annexes;
Contract Postal Units; and Community Post Offices. The Postal Service
argues that if the intent is to reflect the locations at which
customers may access retail services, it would seem unnecessary to
include Carrier Annexes. Postal Service Comments at 47-48.
The Commission's intent is to encompass both retail and commercial
customer access points. The Commission's understanding is that some
Carrier Annex locations accept mail from commercial customers. The term
``post office'' is used in the generic sense in the rule to indicate
customer access points. In this instance, it is consistent with the
Postal Service characterization of reporting on facility types. Thus,
Carrier Annexes are to be included in reporting.
Customer access is to be reported annually. In Order No. 292, the
Commission asked that for the immediate future the Postal Service
voluntarily provide these reports on a quarterly basis. Order No. 292
at 30-31. The Commission again requests that this information be
provided voluntarily.
C. Rule 3055.92--Customer Experience Measurement Surveys
Rule 3055.92 requires the Postal Service to file with the
Commission a copy of each type of Customer Experience Measurement
Survey instrument used in the preceding fiscal year, and to report a
summary of the information obtained on an annual basis. Where the
Postal Service solicits information through multiple choice questions,
it is required to provide additional detail by providing the number of
responses obtained for each possible response. The summary of
information obtained also must include a description of the customer
type targeted by each distinct type of survey instrument, statistics on
the number of surveys initiated, and the number of surveys returned to
the Postal Service.
The Postal Service previously informed the Commission that it
intends to redesign its Customer Satisfaction Measurement Survey to
meet the requirements of the PAEA and to generate customer satisfaction
data on a product-by-product basis.\35\ The Postal Service anticipated
that it will be transitioning from the former Customer Satisfaction
Measurement system to a newly named Customer Experience Measurement
system during FY 2010. The Postal Service recently informed the
Commission that the transition to the new Customer Experience
Measurement system is complete. The final rule has been updated to
reflect this name change, and to account for potential future name
changes.
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\35\ Docket No. PI2008-1, Reply Comments of the United States
Postal Service, February 1, 2008, at 11.
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The Public Representative states that the Customer Experience
Measurement program was developed without Commission consultation.
Thus, it argues that the Commission is currently unable to determine
whether the Customer Experience Measurement program will satisfy the
statutory requirements. The Public Representative asks the Commission
to conclude that the Customer Experience Measurement program is an
internal measurement system that has not been approved by the
Commission pursuant to 39 U.S.C. 3691(B)(2). He then asks that the
Commission request public comment on the information that should be
included in this program for measuring customer satisfaction. Public
Representative Reply Comments at 12-15.
The Customer Experience Measurement survey is an internal Postal
Service management tool, which also may be of use for reporting
customer satisfaction. The Postal Service may develop internal
management tools with or without Commission approval. The Commission
provided guidance during the consultation process to increase the
likelihood that future consumer surveys, including the Customer
Experience Measurement survey, would produce reliable and meaningful
information. Order No. 292 at 32. The Postal Service did not believe
that the Commission should be involved in the actual survey process.
Postal Service Comments at 51-53.
As a starting point in developing a customer satisfaction
measurement system, the Commission defers to the Postal Service's
expertise in developing this form of survey. After experience is
[[Page 38741]]
gained, the Commission may identify topics on which additional
information is needed. The Postal Service will be responsible for
developing appropriate means for producing this information. The
Commission does not adopt the Public Representative's proposal.
D. Rule 3055.93--Mystery Shopper Program
Proposed rule 3055.93 seeks information obtained from the Mystery
Shopper Program. It requires the Postal Service to file a copy of the
National Executive Summary Report (which summarizes data from the
Mystery Shopper Program) on a quarterly basis, along with each type of
survey instrument used in preparing each report. The Commission
understands that the Mystery Shopper Program is a management tool for
developing proprietary information and is aware of the necessity that
the ``mystery'' of the program be maintained.
The Postal Service argues that the requirement to file copies of
the National Executive Summary Report generated by the Mystery Shopper
Program is unwarranted and should be eliminated. The Postal Service
explains that the program is primarily designed to help local retail
managers retain business in a competitive marketplace. The Postal
Service contends that the information generated by this program is
commercially sensitive and proprietary in nature. Furthermore, the
program consists of objective observations about the conditions in
postal facilities and operational practices, and does not provide
direct evidence of customer satisfaction within the meaning of the
statute. Id. at 53-56.
The usefulness of using Mystery Shopper Program data in the
evaluation of customer satisfaction is best explained by example. The
Commission finds the effect of wait time in line to mail a parcel
requiring counter service relevant to customer satisfaction with the
overall product. If mailers have to wait an excessively long time to
enter parcels into the system, they will become dissatisfied and place
less value on using the product.
Nonetheless, the Commission agrees that the detailed operational
information gathered by the Mystery Shopper Program is designed to
assist local managers to identify and correct problems rather than to
capture the attitudes of customers. Therefore, the Commission will
eliminate proposed rule 3055.93 from the final rules on service
performance measurement.
E. Suggested Data Reporting Item
The Public Representative proposes that customer satisfaction
reporting can be improved by requiring the reporting of Call Center and
other customer inquiry data. Public Representative Comments at 17-20.
The Postal Service opposes incorporating requirements to include Call
Center and other customer inquiry data. It argues that this data is
compiled for management and diagnostic purposes and should not be
reported. Postal Service Reply Comments at 36-37.
The Commission will not accept the Public Representative's
proposal. The potential benefits and limitations of this type of
information have not been sufficiently explored in this docket for an
informed decision to be made.
Concurring Opinion of Commissioner Dan G. Blair and Vice Chairman Tony
L. Hammond
We concur with the regulations establishing reporting requirements
for measuring the level of service performance for market dominant
products as required by 39 U.S.C. 3652. We do not, however, agree that
section VI of this order meets the intent and spirit of the Postal
Accountability and Enhancement Act (PAEA), Pub. L. 109-143, 120 Stat.
3218 (2006).
Section 3652 requires that the Postal Service include in an annual
report to the Commission an analysis of the quality of service ``for
each market-dominant product provided in such year'' by providing ``(B)
measures of the quality of service afforded by the Postal Service in
connection with such product, including--(i) the level of service
(described in terms of speed of delivery and reliability) provided; and
(ii) the degree of customer satisfaction with the service provided.''
Section VI of this order includes reporting rules on customer
satisfaction. However, this reporting is not tied to any specific
market dominant product. Rather, these reporting requirements focus on
the number, type, and status of post offices serving the public; the
number and type of delivery points accessed by the Postal Service; and
the number of collection boxes provided by the Postal Service. Access
to postal services are provided through means beyond brick and mortar
facilities such as those on the internet, at retail stores, or at
kiosks, just to name a few. While this information has relevance in a
broader context of postal operations, see 39 U.S.C. 3651, the reporting
requirements are not related to specific market dominant products.
In addition, the rules require the submission of data compiled from
Customer Experience Measurement surveys. We recognize such surveys are
a useful management tool. However, the information sought is not
directly tied to market dominant service level performance. We find it
significant that while 39 U.S.C. 3652 requires that the Annual
Compliance Report include information on the degree of customer
satisfaction, 39 U.S.C. 3653 does not specify customer satisfaction as
a topic on which a finding of compliance or noncompliance must be made.
These reporting requirements may place an unnecessary burden on the
Postal Service at a time when it has limited resources.
VII. Ordering Paragraphs
It is ordered:
1. The Commission amends its rules of practice and procedure by
adding new part 3055--Service Performance Measurement and Customer
Satisfaction Reporting. This part is subdivided into Subpart A--Annual
Reporting of Service Performance Achievements, Subpart B--Periodic
Reporting of Service Performance Achievements, and Subpart C--Reporting
of Customer Satisfaction.
2. The Postal Service's initial request for semi-permanent
exceptions from reporting shall be filed with the Commission no later
than June 25, 2010. Interested persons may file comments concerning
this request until July 16, 2010.
3. The Postal Service's request for temporary waivers from
reporting, including its implementation plans, shall be filed with the
Commission no later than September 10, 2010. Interested persons may
file comments concerning this request until October 1, 2010.
4. The Secretary shall arrange for publication of this notice in
the Federal Register.
List of Subjects
39 CFR Part 3050
Administrative practice and procedure, Postal Service, Reporting
and recordkeeping requirements.
39 CFR Part 3055
Administrative practice and procedure, Postal Service, Reporting
and recordkeeping requirements.
By the Commission.
Shoshana M. Grove,
Secretary.
0
For the reasons discussed in the preamble, the Postal Regulatory
Commission amends chapter III of title 39 of the Code of Federal
Regulations as follows:
[[Page 38742]]
PART 3050--PERIODIC REPORTING
0
1. The authority citation for part 3050 continues to read as follows:
Authority: 39 U.S.C. 503; 3651, 3652.
Sec. Sec. 3050.50 through 3050.53 [Removed]
0
2. Remove reserved Sec. Sec. 3050.50 through 3050.53.
0
3. Add part 3055 to read as follows:
PART 3055--SERVICE PERFORMANCE AND CUSTOMER SATISFACTION REPORTING
Subpart A--Annual Reporting of Service Performance Achievements
Sec.
3055.1 Annual reporting of service performance achievements.
3055.2 Contents of the annual report of service performance
achievements.
3055.3 Reporting exceptions.
3055.4 Internal measurement systems.
3055.5 Changes to measurement systems, service standards, service
goals or reporting methodologies.
3055.6 Addition of new market dominant products or changes to
existing market dominant products.
3055.7 Special study.
3055.20 First-Class Mail.
3055.21 Standard Mail.
3055.22 Periodicals.
3055.23 Package Services.
3055.24 Special Services.
3055.25 [Reserved]
Subpart B--Periodic Reporting of Service Performance Achievements
Sec.
3055.30 Periodic reporting of service performance achievements.
3055.31 Contents of the Quarterly Report of service performance
achievements.
3055.32 Measurement systems using a delivery factor.
3055.45 First-Class Mail.
3055.50 Standard Mail.
3055.55 Periodicals.
3055.60 Package Services.
3055.65 Special Services.
3055.70 [Reserved]
Subpart C-Reporting of Customer Satisfaction
Sec.
3055.90 Reporting of customer satisfaction.
3055.91 Consumer access to postal services.
3055.92 Customer Experience Measurement Surveys.
Authority: 39 U.S.C. 503, 3622(a), 3652(d) and (e); 3657(c).
Subpart A-- Annual Reporting of Service Performance Achievements
Sec. 3055.1 Annual reporting of service performance achievements.
For each market dominant product specified in the Mail
Classification Schedule in part 3020, appendix A to subpart A of part
3020 of this chapter, the Postal Service shall file a report as part of
the section 3652 report addressing service performance achievements for
the preceding fiscal year.
Sec. 3055.2 Contents of the annual report of service performance
achievements.
(a) The items in paragraphs (b) through (k) of this section shall
be included in the annual report of service performance achievements.
(b) The class or group-specific reporting requirements specified in
Sec. Sec. 3055.20 through 3055.25.
(c) The applicable service standard(s) for each product.
(d) The applicable service goal(s) for each product.
(e) A description of the measurement system for each product,
including:
(1) A description of what is being measured;
(2) A description of the system used to obtain each measurement;
(3) A description of the methodology used to develop reported data
from measured data;
(4) A description of any changes to the measurement system or data
reporting methodology implemented within the reported fiscal year; and
(5) Where proxies are used, a description of and justification for
the use of each proxy.
(f) A description of the statistical validity and reliability of
the results for each measured product.
(g) A description of how the sampled data represents the national
geographic mail characteristics or behavior of the product.
(h) For each product that does not meet a service standard, an
explanation of why the service standard is not met, and a plan
describing the steps that have or will be taken to ensure that the
product meets or exceeds the service standard in the future.
(i) The identification of each product, or component of a product,
granted an exception from reporting pursuant to Sec. 3055.3, and a
certification that the rationale for originally granting the exception
remains valid.
(j) Documentation showing how data reported at a given level of
aggregation were derived from data reported at greater levels of
disaggregation. Such documentation shall be in electronic format with
all data links preserved. It shall show all formulas used, including
volumes and other weighting factors.
(k) For each product, documentation showing how the reports
required by subpart A of this part were derived from the reports
required by subpart B of this part. Such documentation shall be in
electronic format with all data links preserved. It shall show all
formulas used, including volumes and other weighting factors.
Sec. 3055.3 Reporting exceptions.
(a) The Postal Service may petition the Commission to request that
a product, or component of a product, be excluded from reporting,
provided the Postal Service demonstrates that:
(1) The cost of implementing a measurement system would be
prohibitive in relation to the revenue generated by the product, or
component of a product;
(2) The product, or component of a product, defies meaningful
measurement; or
(3) The product, or component of a product, is in the form of a
negotiated service agreement with substantially all components of the
agreement included in the measurement of other products.
(b) The Postal Service shall identify each product or component of
a product granted an exception in each report required under subparts A
or B of this part, and certify that the rationale for originally
granting the exception remains valid.
Sec. 3055.4 Internal measurement systems.
Service performance measurements obtained from internal measurement
systems or hybrid measurement systems (which are defined as systems
that rely on both an internal and an external measurement component)
shall not be used to comply with any reporting requirement under
subparts A or B of this part without prior Commission approval.
Sec. 3055.5 Changes to measurement systems, service standards,
service goals, or reporting methodologies.
The Postal Service shall file notice with the Commission describing
all changes to measurement systems, service standards, service goals or
reporting methodologies, including the use of proxies for reporting
service performance, 30 days prior to planned implementation. The
Commission may initiate a proceeding at any time to consider such
changes if it appears that the changes might have a material impact on
the accuracy, reliability, or utility of the reported measurement, or
if the changes might have a material impact on the characteristics of
the underlying product.
Sec. 3055.6 Addition of new market dominant products or changes to
existing market dominant products.
Whenever the Postal Service proposes the addition of a new market
dominant product or a change to an existing
[[Page 38743]]
market dominant product, it also shall propose new or revised (as
necessary) service performance measurement systems, service standards,
service goals, data reporting elements, and data reporting
methodologies.
Sec. 3055.7 Special study.
Included in the second section 3652 report due after this rule
becomes final, and every 2 years thereafter, the Postal Service shall
provide a report, by class of mail, on delivery performance to remote
areas of the Alaska, Caribbean, and Honolulu districts.
Sec. 3055.20 First-Class Mail.
(a) Single-Piece Letters/Postcards, Bulk Letters/Postcards, Flats,
and Parcels. For each of the Single-Piece Letters/Postcards, Bulk
Letters/Postcards, Flats, and Parcels products within the First-Class
Mail class, report the on-time service performance (as a percentage
rounded to one decimal place), disaggregated by mail subject to the
overnight, 2-day, and 3/4/5-day service standards.
(b) Outbound Single-Piece First-Class Mail International and
Inbound Single-Piece First-Class Mail International. For each of the
Outbound Single-Piece First-Class Mail International and Inbound
Single-Piece First-Class Mail International products within the First-
Class Mail class, report the on-time service performance (as a
percentage rounded to one decimal place).
Sec. 3055.21 Standard Mail.
For each product within the Standard Mail class, report the on-time
service performance (as a percentage rounded to one decimal place).
Sec. 3055.22 Periodicals.
For each product within the Periodicals class, report the on-time
service performance (as a percentage rounded to one decimal place).
Sec. 3055.23 Package Services.
For each product within the Package Services class, report the on-
time service performance (as a percentage rounded to one decimal
place).
Sec. 3055.24 Special Services.
For each product within the Special Services group, report the
percentage of time (rounded to one decimal place) that each product
meets or exceeds its service standard.
Sec. 3055.25 Nonpostal products [Reserved]
Subpart B--Periodic Reporting of Service Performance Achievements
Sec. 3055.30 Periodic reporting of service performance achievements.
For each market dominant product specified in the Mail
Classification Schedule in part 3020, appendix A to subpart A of part
3020 of this chapter, the Postal Service shall file a Quarterly Report
with the Commission addressing service performance achievements for the
preceding fiscal quarter (within 40 days of the close of each fiscal
quarter).
Sec. 3055.31 Contents of the Quarterly Report of service performance
achievements.
(a) The items in paragraphs (b) through (e) of this section shall
be included in the quarterly report of service performance
achievements.
(b) The class or group-specific reporting items specified in
Sec. Sec. 3055.45 through 3055.70.
(c) The identification of each product, or component of a product,
granted an exception from reporting pursuant to Sec. 3055.3, and a
certification that the rationale for originally granting the exception
remains valid.
(d) Documentation showing how data reported at a given level of
aggregation were derived from data reported at greater levels of
disaggregation. Such documentation shall be in electronic format with
all data links preserved. It shall show all formulas used, including
volumes and other weighting factors.
(e) A year-to-date aggregation of each data item provided in each
Quarterly Report due for the reported fiscal year, where applicable,
including volumes and other weighting factors provided in electronic
format, with formulas shown and data links preserved to allow
traceability to individual Quarterly Reports.
Sec. 3055.32 Measurement systems using a delivery factor.
For measurements that include a delivery factor, the duration of
the delivery factor also shall be presented independent of the total
measurement.
Sec. 3055.45 First-Class Mail.
(a) Single-Piece Letters/Postcards, Bulk Letters/Postcards, Flats,
and Parcels. For each of the Single-Piece Letters/Postcards, Bulk
Letters/Postcards, Flats, and Parcels products within the First-Class
Mail class, report the:
(1) On-time service performance (as a percentage rounded to one
decimal place), disaggregated by mail subject to the overnight, 2-day,
and 3/4/5-day service standards, provided at the District, Postal
Administrative Area, and National levels; and
(2) Service variance (as a percentage rounded to one decimal place)
for mail delivered within +1 day, +2 days, and +3 days of its
applicable service standard, disaggregated by mail subject to the
overnight, 2-day, and 3/4/5-day service standards, provided at the
District, Postal Administrative Area, and National levels.
(b) Outbound Single-Piece First-Class Mail International and
Inbound Single-Piece First-Class Mail International. For each of the
Outbound Single-Piece First-Class Mail International and Inbound
Single-Piece First-Class Mail International products within the First-
Class Mail class, report the:
(1) On-time service performance (as a percentage rounded to one
decimal place), provided at the Postal Administrative Area and National
levels; and
(2) Service variance (as a percentage rounded to one decimal place)
for mail delivered within +1 day, +2 days, and +3 days of its
applicable service standard, provided at the Postal Administrative Area
and National levels.
Sec. 3055.50 Standard Mail.
(a) For each product within the Standard Mail class, report the on-
time service performance (as a percentage rounded to one decimal
place), disaggregated by the Destination Entry (2-day), Destination
Entry (3-day through 4-day), Destination Entry (5-day through 10-day),
End-to-End (3-day through 5-day), End-to-End (6-day through 10-day),
and End-to-End (11-day through 22-day) entry mail/service standards,
provided at the District, Postal Administrative Area, and National
levels.
(b) For each product within the Standard Mail class, report the
service variance (as a percentage rounded to one decimal place) for
mail delivered within +1 day, +2 days, and +3 days of its applicable
service standard, disaggregated by the Destination Entry (2-day),
Destination Entry (3-day through 4-day), Destination Entry (5-day
through 10-day), End-to-End (3-day through 5-day), End-to-End (6-day
through 10-day), and End-to-End (11-day through 22-day) entry mail/
service standards, provided at the District, Postal Administrative
Area, and National levels.
Sec. 3055.55 Periodicals.
(a) Within County Periodicals. For the Within County Periodicals
product within the Periodicals class, report the:
[[Page 38744]]
(1) On-time service performance (as a percentage rounded to one
decimal place), provided at the Postal Administrative Area and National
levels; and
(2) Service variance (as a percentage rounded to one decimal place)
for mail delivered within +1 day, +2 days, and +3 days of its
applicable service standard, provided at the Postal Administrative Area
and National levels.
(b) Outside County Periodicals. For the Outside County Periodicals
product within the Periodicals class, report the:
(1) On-time service performance (as a percentage rounded to one
decimal place), disaggregated by the Destination Entry and End-to-End
entry mail, provided at the Postal Administrative Area and National
levels; and
(2) Service variance (as a percentage rounded to one decimal place)
for mail delivered within +1 day, +2 days, and +3 days of its
applicable service standard, disaggregated by the Destination Entry and
End-to-End entry mail, provided at the Postal Administrative Area and
National levels.
Sec. 3055.60 Package Services.
(a) Single-Piece Parcel Post. For the Single-Piece Parcel Post
product within the Package Services class, report the:
(1) On-time service performance (as a percentage rounded to one
decimal place), disaggregated by mail subject to the 2-day through 4-
day and 5-day through 20-day service standards, provided at the
District, Postal Administrative Area, and National levels; and
(2) Service variance (as a percentage rounded to one decimal place)
for mail delivered within +1 day, +2 days, and +3 days of its
applicable service standard, disaggregated by mail subject to the 2-day
through 4-day and 5-day through 20-day service standards, provided at
the District, Postal Administrative Area, and National levels.
(b) Bound Printed Matter Flats, Bound Printed Matter Parcels, and
Media Mail/Library Mail. For each of the Bound Printed Matter Flats,
Bound Printed Matter Parcels, and Media Mail/Library Mail products
within the Package Services class, report the:
(1) On-time service performance (as a percentage rounded to one
decimal place), disaggregated by the Destination Entry and End-to-End
entry mail, provided at the District, Postal Administrative Area, and
National levels; and
(2) Service variance (as a percentage rounded to one decimal place)
for mail delivered within +1 day, +2 days, and +3 days of its
applicable service standard, disaggregated by the Destination Entry and
End-to-End entry mail, provided at the District, Postal Administrative
Area, and National levels.
(c) Inbound Surface Parcel Post (at UPU rates). For the Inbound
Surface Parcel Post (at UPU rates) product within the Package Services
class, report the:
(1) On-time service performance (as a percentage rounded to one
decimal place), provided at the Postal Administrative Area and National
levels; and
(2) Service variance (as a percentage rounded to one decimal place)
for mail delivered within +1 day, +2 days, and +3 days of its
applicable service standard, provided at the Postal Administrative Area
and National levels.
Sec. 3055.65 Special Services.
(a) For each product within the Special Services group, report the
percentage of time (rounded to one decimal place) that each product
meets or exceeds its service standard, provided at the National level.
(b) Additional reporting for Ancillary Services. For the Certified
Mail, electronic Return Receipt, Delivery Confirmation, Insurance, and
an aggregation of all other services within the Ancillary Services
product, individually report the percentage of time (rounded to one
decimal place) that each service meets or exceeds its service standard.
For green card Return Receipt report:
(1) The number of EXFC seed mailpieces sent;
(2) The percentage of green cards properly completed and returned;
(3) The percentage of green cards not properly completed, but
returned;
(4) The percentage of mailpieces returned without a green card
signature; and
(5) The percentage of the time the service meets or exceeds its
overall service standard.
(c) Additional reporting for Post Office Box Service. For Post
Office Box Service, report the percentage of time (rounded to one
decimal place) that the product meets or exceeds its service standard,
provided at the District and Postal Administrative Area levels.
Sec. 3055.70 Nonpostal products [Reserved]
Subpart C--Reporting of Customer Satisfaction
Sec. 3055.90 Reporting of customer satisfaction.
For each market dominant product specified in the Mail
Classification Schedule in part 3020, appendix A to subpart A of part
3020 of this chapter, the Postal Service shall file a report as part of
the section 3652 report, unless a more frequent filing is specifically
indicated, addressing customer satisfaction achievements for the
preceding fiscal year. The report shall include, at a minimum, the
specific reporting requirements presented in Sec. Sec. 3055.91 through
3055.92.
Sec. 3055.91 Consumer access to postal services.
(a) The following information pertaining to post offices shall be
reported, disaggregated by type of post office facility, and provided
at the Postal Administrative Area and National levels:
(1) The number of post offices at the beginning of the reported
fiscal year;
(2) The number of post offices at the end of the reported fiscal
year;
(3) The number of post office closings in the reported fiscal year;
(4) The number of post office emergency suspensions in effect at
the beginning of the reported fiscal year;
(5) The number of post office emergency suspensions in the reported
fiscal year; and
(6) The number of post office emergency suspensions in effect at
the end of the reported fiscal year.
(b) The following information pertaining to delivery points shall
be reported, disaggregated by delivery point type, provided at the
Postal Administrative Area and National levels:
(1) The number of residential delivery points at the beginning of
the reported fiscal year;
(2) The number of residential delivery points at the end of the
reported fiscal year;
(3) The number of business delivery points at the beginning of the
reported fiscal year; and
(4) The number of business delivery points at the end of the
reported fiscal year.
(c) The following information pertaining to collection boxes shall
be reported, provided at the Postal Administrative Area and National
levels:
(1) The number of collection boxes at the beginning of the reported
fiscal year;
[[Page 38745]]
(2) The number of collection boxes at the end of the reported
fiscal year;
(3) The number of collection boxes removed during the reported
fiscal year; and
(4) The number of collection boxes added to new locations during
the reported fiscal year.
(d) The average customer wait time in line for retail service shall
be reported. Data shall be provided for the beginning of the reported
fiscal year and for the close of each successive fiscal quarter at the
Postal Administrative Area and National levels.
Sec. 3055.92 Customer Experience Measurement Surveys.
(a) The report shall include a copy of each type of Customer
Experience Measurement instrument, or any similar instrument that may
supersede the Customer Experience Measurement instrument used in the
preceding fiscal year.
(b) The report shall include information obtained from each type of
Customer Experience Measurement instrument, or any similar instrument
that may supersede the Customer Experience Measurement instrument
including:
(1) A description of the customer type targeted by the survey;
(2) The number of surveys initiated and the number of surveys
received; and
(3) Where the question asked is subject to a multiple choice
response, the number of responses received for each question,
disaggregated by each of the possible responses.
[FR Doc. 2010-16178 Filed 7-2-10; 8:45 am]
BILLING CODE 7710-FW-S