Update: USPS Remanded Again for Data, Billing Inconsistencies

On Wednesday, The Postal Regulatory Commission (PRC) denied the United States Postal Service’s request for rate changes on market dominant products.  This is the second remand.  The first occurred on March 6th.

We covered the first remand, which stated that the USPS didn’t meet several requirements and included errors and inconsistencies – many of which are required by title 39.  In order No. 2398, released on Wednesday, the PRC stated that “because the Postal Service has not complied fully with applicable statutory and regulatory requirements and Order No. 2378, the Commission remands the revised price adjustments set forth in the Response for further revision, correction, and clarification.”

The PRC’s second analysis still discovered several of the same discrepancies that were found in the first filing for rate changes.  The second remand focused on miscalculations in nonprofit and commercial pricing, the Flats Sequencing System (FSS), and other pricing issues.

In response to the PRC’s findings, the USPS does not plan to propose any price changes to Package Services.  Instead, the Postal Service plans to revise its Package Services price cap calculation.  According to Order No. 2378, the USPS calculates a revised Package Services total price adjustment of 1.947 percent.  As a reminder, this is less than the price cap of 1.966 percent.

The USPS has also filed a Special Weight Report that would address concerns around the FSS.  The USPS has until March 25th to make the PRC’s suggested changes.

More information on the second USPS remand can be found here.

USPS Proposal for Price Adjustments Deemed Incomplete by Postal Regulatory Commission

Click the photo above to be taken to the official announcement of remand on the PRC's website.

Click the photo above to be taken to the official announcement of remand on the PRC’s website.

In January, the USPS filed noticed of a planned price adjustment for market dominant products.  Today, the Postal Regulatory Commission (PRC) announced that they will not honor the requested price increases until the USPS modifies their request.

In Docket No. R2015-4, the PRC highlighted several reasons for their remand:

  • As currently proposed, prices for the Standard Mail, Periodicals, and Package Services classes do not comply with certain statutory and regulatory requirements and are therefore remanded to the Postal Service for further action.
  • The unequal commercial and nonprofit discounts in the Standard Mail class violate the requirement that disparities between commercial and nonprofit discounts must be justified.
  • The Postal Service did not provide a justification for the proposed unequal nonprofit and commercial dropship discounts.
  • Standard Mail workshare discounts exceed 100 percent and have not been adequately justified.
  • The USPS incorrectly adjusted several billing determinants associated with Flats Sequencing System (FSS) prices for Periodicals bundles, sacks, and pallets and failed to provide the Commission with the data necessary to calculate the actual average price increase for the Periodicals class.
  • The Postal Service’s initial filing in this proceeding contained many errors and inconsistencies and lacked information required by title 39 and the Commission’s regulations.

Because of their findings, the Commission determined that the USPS proposal was “incomplete with respect to the price adjustments related to Standard Mail, Periodicals, Package Services, and Special Services.”  If the USPS “complete[s] responses to certain information requests, the Notice would be complete and the 45-day notice period would begin for price adjustments related to the affected classes of mail.”

Specific information on the Commission’s findings above, including explanations for each of their remands, can be read in Docket R2015-4.

New Postmaster General to Focus on Growth

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Megan Brennan was recently announced as the 74th USPS Postmaster General and CEO.

Earlier this month, Megan J. Brennan was formally introduced as the 74th Postmaster General and CEO of the USPS.  In a letter to her colleagues, she outlined her plan for long term success.

“I firmly believe that our future is filled with opportunity, not just through the prism of winning customers and growing our business, but also from the perspective of enhancing our brand and the value we provide to the American public,” Brennan said.  “We can reinvigorate the way we serve our customers and the public by constantly looking forward as an organization, anticipating the changing needs of our customers, and adapting as quickly as we can to a competitive and evolving marketplace.”

While shipping and package volume rose 12.8 percent and standard mail volume increase 3.5 percent in quarter 1 (Q1), the USPS still suffered a $754 million Q1 net loss.  In a recent press release, Brennan added that the organization will focus on the momentum of success by continuing to expand solutions and service.

“Our employees delivered double-digit growth in packages this holiday season, which shows our growing ability to compete for and win new package delivery customers,” Brennan said.

Brennan succeeds Postmaster General Patrick Donahoe, who announced his retirement last year.  His final speech was delivered to the Nation Press Club last month.

Specific Q1 financial information is available on the USPS website.  More information on Postmaster General Megan Brennan can be found here.

Global Mail Delivery Delays Update: February 5, 2015

World Map_standing imageHere are the current areas of the world that may be experiencing mail delays.

Source: International Delivery Solutions

Canada – Severe winter storms have disrupted the processing and delivery of parcels and mail to the Atlantic provinces of the country since Feb 3rd.  The provinces of Newfoundland, Labrador, Nova Scotia, New Brunswick and Prince Edward Island were identified as customers who may not receive mail. Once conditions improve, delivery will resume.  In addition, Hamilton and South Western Ontario were affected since Feb 2nd.

Liberia and Sierra Leone – Since the Ebola Outbreak in August of 2014 Mail into Liberia and Sierra Leone has been restricted, restrictions are being lifted as of this week.

France – Starting Feb 1st, heavy snowfall in France has caused delays to the delivery of mail in the following post code areas:  05xxx, 38xxx, 39xxx, 64xxx, 65xxx, 73xxx and 74xxx.

Germany - Airline strikes Jan 29th, expect possible mail delays.

Brazil – Jan 19th, rolling power blackouts occurred in 10 states across Brazil — including Sao Paulo and Rio de Janeiro — as well as the Federal District, expect some mail delays.

Uzbekistan – Since Jan 18th, limited airline capacity, expect mail delays.

Mauritius - Jan 16th, The Post reports international flights from the island nation have resumed. A tropical cyclone had caused flight cancellations earlier in the week, delaying outbound mail dispatches.

Please Note:  Brazil, Latin America & Caribbean, Carnival begins Feb 13th, expect some mail and transportation delays thru Feb 17th.

Service Spotlight: Every Door Direct Mail

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Click the photo above to read more about Every Door Direct Mail.

Every Door Direct Mail (EDDM) can help publications, retailers, and other businesses reach specific neighborhoods.  By targeting a location without an address list, customers can send out local mailings or national campaigns to build traffic or find new customers.

Publications may also find EDDM a cost-effective option for distributing their product(s) to specific areas.  Two options exist for customers looking to participate in EDDM.

Every Door Direct Mail – Retail Information (as listed in the USPS EDDM User Guide):

  • You must log in to the tool to complete or save your order. New EDDM Retail® accounts can be created within https://reg.usps.com/register
  • Appropriate documentation will be provided online to take with your mailing to the Post Office.
  • Mail pieces are limited to Standard Mail® flats only.
  • Each mailpiece must be at least .007” thick (approx. 3 sheets of copy paper) and cannot exceed 3.3 oz.
  • Each mailpiece must display the Every Door Direct Mail – Retail indicia. According to the Quick Reference Guide on the USPS website, each mailpiece must contain “ECRWSS” in the addresss area or within or below the permit indicia.
  • A viable option for local businesses sending up to 5,000 mailpieces a day per ZIP code.

Every Door Direct Mail – Business Mail Entry Unit Information (as listed in the USPS EDDM User Guide):

  • You must have or must obtain an active USPS Standard Mail® permit number.
  • You may register or log in via https://reg.usps.com/register to access the online tool, or obtain updated delivery statistics via one of the appropriate NCSC products.
  • You must bring appropriate documentation with your mailing to the Business Mail Entry Unit (BMMU) where the permit is held.
  • Pieces may weigh up to 16 ounces, and postage prices may vary based on piece weight and entry point.
  • A viable option for local business sending more than 5,000 mailpieces a day per ZIP code.

An online mapping tool available on the USPS website helps customers indicate the size or specification of an area.  A user guide highlighting the step-by-step process of both EDDM options – including map detail – is available here.

A reference guide detailing label information and sizing for both EDDM products is also available.  Customers looking for more information can register to receive a kit that includes samples.

Winter Storm Juno: USPS Closings and Mail Delays

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The following United States Postal Service (USPS) mail facilities will be closed due to winter storm Juno:

USPS Facility: SPRINGFIELD NDCSpringfield MA 01Z will be closed 1/26/15 through 16:00 01/27/15

USPS Facility: BROOKLYNBrooklyn NY 112 will be closed 1/26/15 through 16:00 01/27/15

USPS Facility: WESTERN NASSAU
Western Nassau NY 115 will be closed 1/26/15 through 16:00 01/27/15

USPS Facility: MID ISLAND
Mid Island NY 117 will be closed 1/26/15 through 16:00 01/27/15

USPS Facility: NEW YORK
New York NY 100 will be closed 1/26/15 through 16:00 01/27/15

USPS Facility: WESTCHESTER
Westchester NY 105 will be closed 1/26/15 through 16:00 01/27/15

USPS Facility: HARTFORD
Hartford CT 060 will be closed 1/26/15 through 16:00 01/27/15

USPS Facility: STAMFORD
Stamford CT 068 will be closed 1/26/15 through 16:00 01/27/15

USPS Facility: BOSTON
Boston MA 021 will be closed 1/26/15 through 16:00 01/27/15 due to winter storm Juno.

USPS Facility: BROCKTON
Brockton MA 023 will be closed 1/26/15 through 16:00 01/27/15

USPS Facility: MIDDLESEX ESSEX
Middlesex-Essex MA 018 will be closed 1/26/15 through 16:00 01/27/15

USPS Facility: PROVIDENCE
Providence RI 028 will be closed 1/26/15 through 16:00 01/27/15

USPS Facility: CENTRAL MA
Central MA LDC 015 will be closed 1/26/15 through 16:00 01/27/15

USPS Facility: QUEENS NY
Queens NY 110 will be closed 1/26/15 through 16:00 01/27/15

USPS Facility: SOUTHERN CT
Southern CT 064 will be closed 1/26/15 through 16:00 01/27/15

USPS Files for Price Change to Improve Products, Promotions

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Click the photo for more information on the available price cap.

Yesterday, the Postal Regulatory Commission (PRC) received paperwork from the USPS requesting a market dominant price change based on the Consumer Price Index (CPI).

As a reminder, the CPI cap authority is 1.966%.  A helpful tool on the PRC’s website states that the Commission “determines the price cap for any 12-month period by calculating the ratio of two 12-month CPI-U averages that are 12 months apart, subtracting one, and expressing the value as a percentage.”

Information on the PRC’s website notes there will be annual “regular and predictable price changes.”

“On January 27, 2013, the Postal Service implemented a price increase on all market-dominant classes equal, on average, to the applicable price cap limitation.  The Postal Service expects that, in each subsequent year, price changes for all of the market-dominant classes will equal, on average, the price cap limitation applicable in that year,” the homepage states.

Information on the average change in CPI can be found on the PRC’s website.  Information from November 2014 indicated that the 1.966% available price cap for First-Class Mail, Standard Mail, Periodicals, Package Services, and Special Services is from the 1.685% price cap currently available plus an interim unused rate adjustment authority of 0.281%.

A press release issued by the Postal Customer Council stated that “key elements” of this CPI case include the following:

  • Above average price increases to address PRC concerns about underwater products
  • Special Services simplification to reduce redundancy and improve customer ease of use
  • Introduction of a separate Flats Sequencing System (FSS) pricing structure for Standard Mail and Periodicals
  • Introduction of Carrier Route bundle and container pricing for non-FSS flats for Standard Mail and Periodicals
  • Include four promotions (Earned Value Reply Mail, Color Transpromo, Emerging Technologies, Mail Drives Mobile)

If approved by the PRC, this price change will generate $0.9 billion annually and would go into effect in late April of 2015.

More information on the CPI can be found here.