2011-129. New Postal Product

AGENCY:

Postal Regulatory Commission.

ACTION:

Notice.

SUMMARY:

The Commission is noticing a recently-filed Postal Service request to add Priority Mail Contract 35 to the competitive product list. This notice addresses procedural steps associated with this filing.

DATES:

Comments are due: January 12, 2011.

ADDRESSES:

Submit comments electronically via the Commission's Filing Online system at http://www.prc.gov. Commenters who cannot submit their views electronically should contact the person identified in FOR FURTHER INFORMATION CONTACT by telephone for advice on alternatives to electronic filing.

FOR FURTHER INFORMATION CONTACT:

Stephen L. Sharfman, General Counsel, [e-mail] or 202-789-6820.

SUPPLEMENTARY INFORMATION:

Table of Contents

I. Introduction

II. Notice of Filing

III. Ordering Paragraphs

I. Introduction

In accordance with 39 U.S.C. 3642 and 39 CFR 3020.30 et seq., the Postal Service filed a formal request and associated supporting information to add Priority Mail Contract 35 to the competitive product list.^[1] Priority Mail contracts enable the Postal Service to provide Priority Mail service to an individual customer at customized rates.^[2] The Postal Service asserts that Priority Mail Contract 35 is a competitive product “not of general applicability” within the meaning of 39 U.S.C. 3632(b)(3). Request at 1. The Request has been assigned Docket No. MC2011-18.

The Postal Service contemporaneously filed a redacted contract related to the proposed new product under 39 U.S.C. 3632(b)(3) and 39 CFR 3015.5. Id., Attachment B. The instant contract has been assigned Docket No. CP2011-57.

Request. To support its Request, the Postal Service filed six attachments as follows:

• Attachment A—a redacted copy of Governors' Decision No. 09-6, authorizing certain Priority Mail contracts, and a certification of the Governors' vote;
• Attachment B—a redacted copy of the contract;
• Attachment C—proposed changes to the Mail Classification Schedule competitive product list that would add Priority Mail Contract 35 under Domestic Negotiated Service Agreements;
• Attachment D—a Statement of Supporting Justification as required by 39 CFR 3020.32;
• Attachment E—a certification of compliance with 39 U.S.C. 3633(a); and
• Attachment F—an application for non-public treatment of materials to maintain redacted portions of the contract, customer-identifying information, and related financial information under seal.

In the Statement of Supporting Justification, Josen Punnoose, Manager, Shipping Support (A), Shipping Services, asserts that the service to be provided under the contract will cover its attributable costs, make a positive contribution to covering institutional costs, and increase contribution toward the requisite 5.5 percent of the Postal Service's total institutional costs. Id., Attachment D at 1. Mr. Punnoose contends that there will be no issue of market dominant products subsidizing competitive products as a result of this contract. Id.

Related contract. The Postal Service included a redacted version of the related contract with the Request. Id., Attachment B. The contract is scheduled to become effective 1 business day after the Commission issues all necessary regulatory approvals. Id. at 2. The contract will expire 3 years from the effective date unless, among other things, either party terminates the agreement upon 30 days' written notice to the other party. Id. at 2-3. The Postal Service represents that the contract is consistent with 39 U.S.C. 3633(a). Id., Attachment D.

The Postal Service filed much of the supporting materials, including the related contract, under seal. Id., Attachment F. It maintains that redacted portions of the contract, customer-identifying information, and related financial information should remain confidential. Id. at 2-3. This information includes the price structure, underlying costs and assumptions, pricing formulas, information relevant to the customer's mailing profile, and cost coverage projections. Id. The Postal Service asks the Commission to protect customer-identifying information from public disclosure indefinitely. Id. at 7.

II. Notice of Filings

The Commission establishes Docket Nos. MC2011-18 and CP2011-57 to consider the Request pertaining to the proposed Priority Mail Contract 35 product and the related contract, respectively.

Interested persons may submit comments on whether the Postal Service's filings in the captioned dockets are consistent with the policies of 39 U.S.C. 3632, 3633, or 3642, 39 CFR 3015.5, and 39 CFR part 3020, subpart B. Comments are due no later than January 12, 2011. The public portions of these filings can be accessed via the Commission's Web site (http://www.prc.gov).

The Commission appoints Paul L. Harrington to serve as Public Representative in these dockets.

III. Ordering Paragraphs

It is ordered:

1. The Commission establishes Docket Nos. MC2011-18 and CP2011-57 to consider the matters raised in each docket.

2. Pursuant to 39 U.S.C. 505, Paul L. Harrington is appointed to serve as officer of the Commission (Public Representative) to represent the interests of the general public in these proceedings.

3. Comments by interested persons in these proceedings are due no later than January 12, 2011.

4. The Secretary shall arrange for publication of this order in the Federal Register.

By the Commission.

Shoshana M. Grove,

Secretary.

Footnotes

1.  Request of the United States Postal Service to Add Priority Mail Contract 35 to Competitive Product List and Notice of Filing (Under Seal) of Contract and Supporting Data, December 30, 2010 (Request).

2.  Decision of the Governors of the United States Postal Service on Establishment of Rates and Classes Not of General Applicability for Priority Mail Contract Group, Docket No. MC2009-25, issued April 27, 2009, at 1 (Governors' Decision No. 09-6).