E9-3483. Change in Rates of General Applicability for Competitive Products

Editorial Note:

Notice document E9-3483 was inadvertently removed from the issue of Monday, February 23, 2009. It appears in this issue in its entirety.

AGENCY:

Postal Service.^TM

ACTION:

Notice of a change in rates of general applicability for competitive products.

SUMMARY:

This notice sets forth changes in rates of general applicability for competitive products.

DATES:

Effective Date: May 11, 2009.

FOR FURTHER INFORMATION CONTACT:

Daniel J. Foucheaux, 202-268-2989.

SUPPLEMENTARY INFORMATION:

On February 3, 2009, pursuant to their authority under 39 U.S.C. 3632, the Governors of the Postal Service established prices and classification changes for competitive products. The Governors' Decision and the record of proceedings in connection with this Decision are reprinted below in accordance with 39 U.S.C. 3632(b)(2).

Neva R. Watson,

Attorney, Legislative.

Decision of the Governors of the United States Postal Service on Changes in Rates and Classes of General Applicability for Certain Competitive Products (Governors' Decision No. 09-01)

February 3, 2009

Statement of Explanation and Justification

Pursuant to our authority under section 3632 of title 39, as amended by the Postal Accountability and Enhancement Act of 2006 (“PAEA”), we establish new prices of general applicability for the following competitive products, and such changes in classifications as are necessary to define the new prices: Parcel Select, Premium Forwarding Service, International Priority Airmail, International Surface Air Lift, and International Ancillary Services. Management's analysis of these changes is provided in Attachment A and the prices and classification are shown in full in Attachment B. We have reviewed management's analysis and have evaluated the new prices and classification changes in accordance with 39 U.S.C. 3632-3633 and 39 CFR 3015.2. We approve the changes set forth in Attachment B, finding that they are appropriate, and are consistent with the regulatory criteria.

In Parcel Select, there are three categories (Origin BMC Presort, BMC Presort, and Barcoded Inter-BMC and Intra-BMC) that were not included in the January 2009 competitive products' price increase. These categories' prices are calculated based on (market-dominant) Single-Piece Parcel Post prices. Accordingly, these categories' prices are being increased concurrently with the market-dominant price change effective on May 11, 2009, in order to maintain their relationship with the Single-Piece Parcel Post prices on which they are based. As a result, prices for the overall Parcel Select product will increase by an additional one-half of one percent. Minor structural changes are also made within the two Presort price categories to better reflect the discount for barcoding. The nonpresort categories (Barcoded Inter-BMC and Intra-BMC) are now merged into one category, Barcoded Nonpresort.

Premium Forwarding Service prices were not changed as part of the competitive products' price increase in January 2009. Premium Forwarding Service prices will increase by 20.2 percent overall on May 11, 2009.

International Priority Airmail (IPA) and International Surface Air Lift (ISAL) prices were not changed as part of the January 2009 adjustment. Their prices are calculated based on First-Class Mail International prices, which are being increased as part of the market-dominant price change effective May 11, 2009. There are also several structural changes: new country specific price groups are added; pricing will be differentiated by presort level (Direct Country, Mixed Country, and Worldwide Non-presort); and Worldwide Non-presort, previously applicable only to IPA, will now also be applicable to ISAL. In addition, mixed country sacks would only be applicable to dropshipped items, and the minimum volume per mailing for IPA is raised to 50 pounds. Noncontractual IPA will have a price increase of 20.8 percent and noncontractual ISAL will increase by 2.4 percent.

Prices for competitive International Ancillary Services are also increasing to coincide with identical increases in the prices of market-dominant International Ancillary Services. Prices for the competitive International Ancillary Services will increase, on average, by 6.1 percent.

As described in Attachment A, these changes satisfy the statutory requirements. They should not result in the subsidization of competitive products by market dominant products (39 U.S.C. 3633(a)(1)). Each competitive product should cover its attributable costs (39 U.S.C. 3633(a)(2)). They should allow competitive products as a whole to comply with 39 U.S.C. 3633(a)(3), which, as implemented by 39 CFR 3015.7(c), requires competitive products to contribute a minimum of 5.5 percent to the Postal Service's total institutional costs.

Order

The changes in prices and classes set forth herein shall be effective at 12:01 a.m. on May 11, 2009. We direct the Secretary to have this decision published in the Federal Register in accordance with 39 U.S.C. 3632(b)(2). We also direct management to file with the Postal Regulatory Commission appropriate notice of these changes.

By The Governors:

___/s/___,

Alan C. Kessler.

Chairman.

Certification of Governors' Vote In Governors' Decision No. 09-01

I Hereby Certify that the Governors voted on adopting Governors' Decision No. 09-01, and that, consistent with 39 U.S.C. 3632(a), a majority of the governors then holding office concurred in the Decision.

Date: February 3, 2009.

___/s/___,

Julie S. Moore.

Secretary of the Board of Governors.

Analysis of Price and Classification Changes

The prices for the following Shipping Services (competitive) products will change on May 11, 2009, as explained below.

I. Parcel Select

There are three categories within Parcel Select (Origin BMC Presort, BMC Presort, and Barcoded Inter-BMC and Intra-BMC) that were not included in the January 2009 price increase for Shipping Services. Although these categories are part of Shipping Services, their prices are being increased in May because they are calculated based on Single-Piece Parcel Post prices, which are part of Mailing Services. The increase in prices for these categories will increase prices for the overall Parcel Select product by an additional one-half of one percent. Also, the price charts within the presorted categories have been re-aligned slightly to better reflect the inclusion of the 3-cent discount for barcoding, and the inter-BMC and intra-BMC prices are merged into one category for barcoded nonpresort parcels.

II. Premium Forwarding Service

Premium Forwarding Service provides residential delivery with a forwarding service for their mail when they are away from their primary residences. Most mail from a customer's permanent address is forwarded once a week via Priority Mail to the customer's temporary address. The customer is charged an enrollment fee and a weekly fee. Overall, Premium Forwarding Service prices will increase by 20.2 percent. These prices were not changed as part of the Shipping Services price increase in January 2009. This is the first price increase for the service since inception in 2005. Premium Forwarding Service had been part of Mailing Services, but, subsequent to last year's price change, was moved, at the Postal Service's request, to Shipping Services. The Premium Forwarding Service enrollment price will increase from $10.00 to $15.00 and the weekly reshipment price will increase from $11.95 to $13.95.

III. IPA/ISAL

IPA and ISAL are bulk international letter products which are closely related to the single-piece First-Class Mail International (FCMI) letter prices that will change in May 2009. While most IPA and ISAL content is entered under customized contractual arrangements with customers, some IPA and ISAL is tendered by customers that do not maintain contracts. These noncontractual prices were not changed as part of the January 2009 adjustment, but are being changed now to align them with FCMI price change in May. There are also several structural changes: new country specific price groups are added; pricing will be differentiated by presort level (Direct Country, Mixed Country, and Worldwide Non-presort); and Worldwide Non-presort, previously applicable only to IPA, will now also be applicable to ISAL. In addition, mixed country sacks would only be applicable to dropshipped items, and the minimum volume per mailing for IPA is raised to 50 pounds. Once implemented, the noncontractual prices will result in increases in the rates charged to customers that have executed customized agreements.

International Priority Airmail (IPA) is a bulk international airmail service for mailing First-Class Mail International items. Noncontractual International Priority Airmail (IPA) will have a price increase of 20.8 percent. This increase is driven by new cost information for noncontractual volumes.

International Surface Air Lift (ISAL) is an international bulk mailing service for mailing First-Class Mail International items. ISAL shipments are flown to the foreign destinations and entered into that country's surface or nonpriority mail system for delivery. Noncontractual International Surface Airlift will have a price increase of 2.4 percent.

IV. International Ancillary Services

Certain International Ancillary Services that are combined with other competitive products are also within the scope of this competitive price change. Customers may purchase an International Certificate of Mailing for evidence of mailing. Customers who purchase International Registered Mail for additional security and limited indemnity protection may also buy International Return Receipt, which provides the sender with evidence of delivery, and International Restricted Delivery, which limits delivery to an indentified recipient. On average, prices for International Certificate of Mailing increase 6.7 percent, for International Registered Mail 6.5 percent, for International Restricted Delivery 4.7 percent, and for International Return Receipt 4.5 percent.

V. Summary

As shown in the nonpublic annex, the price changes should enable each competitive product to cover its attributable costs (39 U.S.C. 3633(a)(2)) and should result in competitive products as a whole complying with 39 U.S.C. 3633(a)(3), which, as implemented by 39 CFR 3015.7(c), requires competitive products to contribute a minimum of 5.5 percent to the Postal Service's institutional costs. Accordingly, no issue of subsidization of competitive products by market dominant products should arise (39 U.S.C. 3633(a)(1)).

2125 Premium Forwarding Service

* * * * *

2125.2 Prices

	($)
Enrollment	15.00
Weekly Reshipment	13.95

* * * * *

2225.6 Prices

International Priority Airmail

The price is determined by adding the applicable per-piece price to the applicable per-pound price. The per-piece price applies to each mailpiece regardless of weight. The per-pound price applies to the net weight (gross weight of the sack minus the tare weight of the sack) of the mail for the specific rate group.

Price group	Direct country sacks			Mixed country sacks
	Per piece	Full service per lb.	ISC drop shipment per lb.	Per piece	Full service per lb.	ISC drop shipment per lb.
1	$0.43	$7.12	$4.62
2	0.15	6.69	4.19
3	0.42	9.07	6.57
4	0.45	9.52	7.02
5	0.43	9.26	6.76
6	0.44	9.26	6.76
7	0.42	9.00	6.50
8	0.41	9.00	6.50
9	0.33	9.97	7.47
10	0.41	9.20	6.70
11	0.40	9.00	6.50	0.42		6.83
12	0.15	8.00	5.50	0.16		5.78
13	0.16	7.35	4.85	0.17		5.10
14	0.15	9.00	6.50	0.16		6.83
15	0.12	9.50	7.00	0.13		7.35

Worldwide Nonpresorted Sacks

Price group	Per piece	Full service per lb.	ISC drop shipment per lb.
n/a	$0.47	$10.98	$8.09

Price group	Direct country sacks			Mixed country sacks
	Per piece	Full service per lb.	ISC drop shipment per lb.	Per piece	Full service per lb.	ISC drop shipment per lb.
1	$0.43	$3.85	$2.85
2	0.12	4.86	3.86
3	0.43	4.49	3.49
4	0.43	4.59	3.59
5	0.43	4.56	3.56
6	0.43	4.45	3.45
7	0.44	4.66	3.66
8	0.43	4.45	3.45
9	0.31	4.76	3.76
10	0.46	4.67	3.67
11	0.43	4.49	3.49	0.46		3.67
12	0.15	5.45	4.45	0.16		4.68
13	0.15	5.55	4.55	0.16		4.78
14	0.15	5.45	4.45	0.16		4.68
15	0.12	6.60	5.60	0.13		5.88

Worldwide Nonpresorted Sacks

Price group	Per piece	Full service per lb.	ISC drop shipment per lb.
n/a	$0.51	$7.63	6.47

2250 International Ancillary Services

2250.1 International Certificate of Mailing

* * * * *

2250.1.2 Prices

Individual Pieces Prices

	($)
Original certificate of mailing for listed pieces of ordinary Priority Mail International parcels	1.15
Three or more pieces individually listed in a firm mailing book or an approved customer provided manifest (per piece)	0.42
Each additional copy of original certificate of mailing or firm mailing bills (each copy)	1.15

Multiple Pieces Prices

Identical pieces of ordinary Single-Piece First-Class Mail International paid with regular stamps, precanceled stamps, or meter stamps are subject to the following fees:

	($)
Up to 1,000 pieces (one certificate for total number)	6.50
Each additional 1,000 pieces or fraction	0.75
Duplicate copy	1.15

2250.2 International Registered Mail

* * * * *

2250.2.2 Prices

	($)
Per Piece	11.50

2250.3 International Return Receipt

* * * * *

2250.3.2 Prices

Outbound International Return Receipt

	($)
Per Piece	2.30

Inbound International Return Receipt

No additional payment.

2250.4 International Restricted Delivery

* * * * *

2250.4.2 Prices

	($)
Per Piece	4.50

2250.5 International Insurance

* * * * *

2250.5.3 Prices

Outbound International Insurance

a. Priority Mail International Insurance

Indemnity limit not over ($)	Canada ($)	All other countries ($)
50	1.75	2.50
100	2.25	3.40
200	2.75	4.40
300	4.70	5.40
400	5.70	6.40
500	6.70	7.40
600	7.70	8.40
675	8.70
700	N/A	9.40
Over 700	N/A	9.40 plus 1.00 for each 100.00 or fraction thereof over 700.00. Maximum indemnity varies by country.

b. Express Mail International Merchandise Insurance

Amount of coverage: ($)	($)
0.01 to 100.00	0.00
100.01 to 200.00	0.75
200.01 to 500.00	2.15
500.01 to 1,000.00	3.55
1,000.01 to 1,500.00	4.95
1,500.01 to 2,000.00	6.35
2,000.01 to 2,500.00	7.75
2,500.01 to 3,000.00	9.15
3,000.01 to 3,500.00	10.55
3,500.01 to 4,000.00	11.95
4,000.01 to 4,500.00	13.35
4,500.01 to 5,000.00	14.75

Part D—Country Price Lists For International Mail

Editorial Note:

Notice document E9-3483 was inadvertently removed from the issue of Monday, February 23, 2009. It appears in this issue in its entirety.