Sen. Susan Collins Urges PRC to Reject USPS Rate Case Proposal
In a letter filed with the PRC as part of the docket considering the rate proposal, Senator Susan Collins, co-author of the 2006 Postal Accountability and Enhancement Act (PAEA), wrote the following :
As the author of the Postal Accountability and Enhancement Act of2006 (PAEA), which grants the Postal Service the limited authority to file an exigent rate case, I want to make the congressional intent regarding the provision completely unambiguous as the Postal Regulatory Commission considers the pending Postal Service request. Neither the language nor the legislative history of the PAEA authorizes the United States Postal Service to file an exigent rate case under the current circumstances.
During the 2007 rulemaking process for the exigent rate case authority, Senator Tom Carper and I sent a letter to the Postal Regulatory Commission (PRC) explaining that the exigent rate authority in the PAEA was intended to be used sparingly. Specifically, the letter explained that the “extraordinary or exceptional circumstances” required to initiate an exigent rate case under the PAEA exist only if “terrorist attacks, natural disasters, and other events … cause significant and substantial declines in mail volume or increases in operating costs that the Postal Service cannot reasonably be expected to adjust to in the normal course of business.”
This letter lays out the express intent of the legislation, along with supporting legislative history. I urge the PRC to rely on it as you consider the Postal Service’s request. As the author of the exigent rate authority, I can attest that the provision was not intended to be used under the current circumstances. Indeed, the Postal Service’s current financial condition is largely the result of its own failure to sufficiently update its business model to adapt to predictable and natural cyclical changes in the economy and mail usage. The Postal Service’s financial condition is not the result of “extraordinary or exceptional circumstances” required by law to initiate an exigent rate case. As such, I urge the PRC to dismiss the case.
The PRC’s approval of an exigent rate increase under these circumstances would be inconsistent with the law and would undermine the intent of PAEA to provide predictability and stability in postal pricing. In light of the express requirements of the statute and its supporting legislative history. I urge you to follow the letter of the law and reject the Postal Service’s exigent rate case proposal.
PRC Schedule For Three Public Hearings On USPS Rate Increase Request
The Postal Regulatory Commission (PRC) has posted schedule of live audio broadcasts for three public hearings to question Postal Service witnesses in the exigent rate case. Links to the audio will be posted on the PRC website approximately 10 minutes prior to the broadcasts.
All public hearings begin at 9:30 a.m.
- Tuesday, 8/10/2010 – USPS Executive Vice President and Chief Financial Officer, Joseph Corbett
- Wednesday, 8/11/2010 – USPS Vice President, Finance and Planning, Stephen J. Masse
- Thursday, 8/12/2010 – USPS Pricing Economist, James M. Kiefer
PRC Thanks Public For Comments On USPS Proposal To End Saturday Delivery
The Postal Regulatory Commission says it has received over 12,000 comments from the public on the postal service’s proposal to end Saturday mail delivery. The PRC issued this thank you to to the public:
Dear Members of the Public, thank you for writing us.
The Commission has received more than 12,000 letters, cards, emails, and faxes so far in response to our request for public comments on a Postal Service proposal to end Saturday mail delivery service across the United States (Docket N2010-1). Your correspondence has provided the Commission with a valuable range of suggestions, ideas, emotions and experiences that augment the comments and testimony we received at seven field hearings conducted throughout the country this spring, and through the formal proceedings now underway at Commission Headquarters in Washington, DC. We appreciate having thoughtful input from civic-minded citizens to help guide our deliberations. We continue to welcome further input and expect to issue our Advisory Opinion in the fall.
The Commission also is here to help you.
We are pleased to assist customers who experience problems with their postal service. The Commission now has expanded authority under the postal law enacted in 2006 to ensure that service and rate issues sent to us by postal customers are resolved by the Postal Service in a timely and appropriate manner. As of the end of June, we have helped customers by resolving 391 rate and service inquiries. In addition, the Commission has created a variety of online resources to assist postal customers in accessing information and assistance. Simply scroll down this web page to find links under the heading “Information for Postal Customers.”
Please do not hesitate to contact us in the future. My fellow Commissioners and I look forward to hearing from you.
Thanks again for writing.
Ruth Y. Goldway
Chairman
source: Postal Regulatory Commission
NALC: USPS Rejected Our Proposal That Would Of Saved Several Hundred Million Dollars Annually
TESTIMONY OF WILLIAM H. YOUNG ON BEHALF OF THE NATIONAL ASSOCIATION OF LETTER CARRIERS, AFL-CIO submitted to the Postal Regulatory Commission regarding USPS Five-Day Delivery Request:
My name is William H. Young. I submit this testimony on behalf of Intervenor National Association of Letter Carriers, AFL-CIO (“NALC”), which serves as the collective bargaining representative of a nationwide bargaining unit of city letter carriers employed by the United States Postal Service (“USPS”). I served as NALC’s President from 2002 to 2009.
In November 2006, during the last round of bargaining between NALC and USPS for a new collective bargaining agreement (“CBA”), NALC made an offer to USPS that included a package of proposed savings. In its offer, NALC proposed a separate workforce of letter carriers to delivery mail on Saturday, with all other letter carriers working only on weekdays.
Under NALC’s proposal, the Saturday letter carrier workforce would have been composed in part of letter carriers who had retired from delivering mail full-time but who wanted to continue to work for USPS one day per week. NALC believed that there was a substantial number of retirees who might be interested in such a Saturday-only position.
Under NALC’s proposal, to the extent Saturday positions remained available after retirees were hired, the Saturday workforce would have consisted of new hires hired from the USPS hiring register who agreed to take a position delivering mail one day per week until fulltime positions with USPS became available.
Under NALC’s proposal, the retirees in the Saturday workforce would have been paid at Step O pay under the CBA. However, USPS would have saved a substantial amount employing them since they were already retired; USPS would not have needed to make pension or retiree health contributions on their behalf. USPS would also have saved a substantial amount employing new hires who worked on Saturdays only. These new hires would have earned entry-level Step A pay under the CBA so long as they were part of the Saturday workforce. Moreover, under NALC’s proposal, these new employees would not have been entitled to pension, health, annual leave and other benefits.
NALC estimated that its proposal would have saved USPS several hundred million dollars annually, assuming that the new Saturday workforce were composed half of retired letter carriers and half of new hires. During negotiations, NALC shared this savings estimate with USPS and USPS did not dispute it.
Although NALC’s proposal would have substantially reduced the cost of Saturday deliveries, USPS did not accept it.
Do Congress And PRC Agree On USPS’s Ability To Request An “Exigent” Rate Increase?
From Mailing Mailing Systems Technology via Postcom:
A question that’s top of mind for many mailers who went through the Postal Accountability Enhancement Act of 2006 (PAEA) is, what does Congress think
about the recent USPS filing to the PRC of an exigent rate increase? Here are some things to consider on the legality of the filing (not the rates themselves) that
Congress may weigh in on.
Update: PRC Hearings On USPS Request For Rate Increase
From July 14 through July 27, the Commission will conduct and audiocast five hearings in Docket N2010-1, and three technical conferences in Docket R2010-4. Links to the audio will be posted here approximately 10 minutes prior to the broadcasts. Click on this message for the hearing schedule. http://www.prc.gov
On July 6, 2010, the Postal Service filed a proposed rate adjustment pursuant to 39 U.S.C. 3622(d)(1)(E) and 39 CFR 3010.60, et seq., of the Commission’s rules.\1\ The filing seeks “to increase rates for market dominant products in excess of the otherwise applicable limitations of 39 U.S.C. 3622(b)(1)(A) and 39 CFR 3010.11.” Id. at 11. The proposed prices represent an aggregate increase of approximately 5.6 percent and are to be implemented on January 2, 2011.
The June 16 conference has provided the Commission with a number of potentially useful suggestions and comments. One of the suggestions was that the Commission include a tentative schedule in the Commission’s initial order. The following schedule responds to that suggestion:
July 6, 2010 Exigent Request filed.
July 19, 2010 First Technical Conference (topics to be determined), to start at 2 p.m.
July 23, 2010 Second Technical Conference (if needed).
July 27, 2010 Third Technical Conference (if needed).
August 5, 2010 Deadline for filing suggested questions to be asked of the Postal Service during the public hearing. 39 CFR 3010.65(c).
August 10-12, 2010 Public Hearings.
August 17, 2010 Deadline for filing initial comments. 39 CFR 3010.65(f).
September 2, 2010 Deadline for filing reply comments. 39 CFR3010.65(g).
October 4, 2010 Deadline for Commission determination. 39 CFR
3010.66.
Absent specific notice to the contrary, all technical conferences and hearings will convene at 9:30 a.m., eastern daylight time in the Commission’s hearing room in Suite 200, 901 New York Ave., NW.,
Washington, DC 20268-0001. Further review of the Postal Service filing may warrant adoption of additional procedural dates and/or requirements. If so, the Commission will issue further procedural orders as it deems advisable or necessary in order to ensure both efficiency and fairness. In that connection, the Commission has taken under advisement the further comments and suggestions made by participants at the June 16, 2010 conference.
source: PRC
Schedule of PRC Hearings On USPS Request for Rate Increase and 5-Day Delivery
Filed under: mail delivery, postal, postal news, rate increase, usps
From the Postal Regulatory Commission (PRC)
Schedule for Hearings on Postage Rate Increase
HEARINGS in Docket N2010-1:
July 14 at 9:30 am …
July 16 at 9:30 am …
July 20 at 9:30 am …
July 21 at 9:30 am
July 22 at 9:30 am /
PRC Releases Tentative Schedule To Hear USPS Request For Rate Hike
“The June 16, 2010 conference has provided the Commission with a number of potentially useful suggestions and comments. One of the suggestions was that the Commission include a tentative schedule in the Commission’s initial order.”
The following schedule responds to that suggestion.
- July 6, 2010 Exigent Request filed.
- July 19, 2010 First Technical Conference (topics to be determined), to start at 2:00 p.m.
- July 23, 2010 Second Technical Conference (if needed).
- July 27, 2010 Third Technical Conference (if needed).
- August 5, 2010 Deadline for filing suggested questions to be asked of the Postal Service during the public hearing. 39 CFR 3010.65(c).
- August 10-12, 2010 Public Hearings.
- August 17, 2010 Deadline for filing initial comments.39 CFR 3010.65(f).
- September 2, 2010 Deadline for filing reply comments.39 CFR 3010.65(g).
- October 4, 2010 Deadline for Commission determination.39 CFR 3010.66.
see full press release: http://prc.gov/Docs/68/68812/Order485.pdf
PRC Affirms USPS Overpaid $50 Billion to Retirement Fund
OPM Must Reconsider Calculations
The Postal Regulatory Commission (PRC) released an independent actuarial report [PDF] on June 30 which confirms that the Postal Service was overcharged $50-$55 billion for payments to the Civil Service Retirement System (CSRS) between 1972 and 2009. The report recommended an “adjustment” of $50-$55 billion in favor of the Postal Service.
The PRC has submitted the report to Congress and the Office of Personnel Management (OPM), which administers the fund. By law, OPM must reconsider its calculation of the Postal Service’s pension assets in light of the report; make any appropriate adjustments, and submit the results of its reconsideration to the Commission, the Postal Service, and Congress.
“There seems to be agreement that an updated recognition and disposition of any surplus, if it is to take place promptly, will require Congressional action,” the report noted.
The Postal Service is facing severe budget deficits due to a requirement of the 2006 Postal Accountability and Enhancement Act (PAEA) that the USPS must “pre-fund” future retiree healthcare benefits at a cost of more than $5 billion a year for 10 years. To help restore the Postal Service to financial health, postal unions and other “stakeholders” have been urging Congress to relieve the USPS of the pre-funding obligation – a burden that no other government agency or private business bears.
“The APWU has opposed the elimination of Saturday mail delivery and other cutbacks,” said APWU President William Burrus. “This finding denies the Postal Service any excuse for refusing to provide the American people the service they have received for more than 200 years.”
The PRC study, Civil Service Retirement System Cost and Benefit Allocation Principles, [PDF] was commissioned by the PRC in response to a request by the USPS. It followed a Jan. 20, 2010, report by the USPS Inspector General [PDF] which concluded that the Postal Service had overpaid CSRS obligations by $75 billion.
Sen. Carper Welcomes News of PRC Discovering $50 Billion USPS Overpayment
The office of Sen. Thomas Carper, D-Del., issued the following news release:
WASHINGTON,DC- Sen. Tom Carper (D-Del.), chairman of the Senate’s Federal Financial Management Subcommittee with jurisdiction over the U.S. Postal Service, issued the following statement reacting to a report submitted to Congress by the Postal Regulatory Commission earlier today:
“Every once and a while in life we find money in places that we aren’t expecting, sort of like when you find a ten dollar bill you forgot in the pocket of your jeans that you haven’t worn in a while. This is a very good day indeed because rarely in life do you discover an extra $50 billion lying around. This discovery couldn’t have come at a better time, as the Postal Service is facing a serious financial crisis. In fact, the overpayment the Postal Regulatory Commission has identified represents less than 25 percent of the Postal Service’s projected long-term budget deficit. That said, this certainly is a helpful development that will give Congress some assistance as we work to provide the Postal Service with much-needed relief from the overly-aggressive retiree health funding schedule that was placed on in 2006. It is my hope that it can also provide some momentum to efforts to remove the roadblocks that often prevent the Postal Service from streamlining its operations. Both of these things – financial relief and more aggressive cost cutting – must take place in the very near future if we want a Postal Service capable of continuing to deliver the goods and services millions of Americans depend on.”
Earlier today, the Postal Regulatory Commission submitted to Congress, the Office of Personnel Management (OPM) and the United States Postal Service, an independent actuarial report on the allocation of the Civil Service Retirement System (CSRS) benefits paid to former Post Office Department employees. The Commission report found that an adjustment of $50-$55 billion in favor of the Postal Service would be equitable.
By law, OPM, which is responsible for calculating the Postal Service’s CSRS pension liability, must now reconsider its calculation of the Postal Service’s pension assets in light of this report, and submit the results of its reconsideration to the Commission, the Postal Service, and Congress.
The Commission report suggests that Congress may wish to alter the schedule established in the Postal Accountability and Enhancement Act (PAEA) for potential transfers from the Postal Service Retirement Fund to its Retiree Health Benefit Fund. Currently, such transfers may not take place before September 30, 2015.
The full report, Civil Service Retirement System Cost and Benefit Allocation Principles, is available on the Commission website, www.prc.gov.