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					                                                                                                                                      Wednesday,
                                                                                                                                      October 17, 2007




                                                                                                                                      Part II

                                                                                                                                      Postal Service
                                                                                                                                      39 CFR Parts 121 and 122
                                                                                                                                      Modern Service Standards for Market-
                                                                                                                                      Dominant Products; Proposed Rule
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                                                58946               Federal Register / Vol. 72, No. 200 / Wednesday, October 17, 2007 / Proposed Rules

                                                POSTAL SERVICE                                          establish a set of modern service                        (4) Mail volume and revenues
                                                                                                        standards for market-dominant products                 projected for future years.
                                                39 CFR Parts 121 and 122                                no later than December 20, 2007.                         (5) The projected growth in the
                                                                                                        Ordinarily, the Postal Service is                      number of addresses the Postal Service
                                                Modern Service Standards for Market-                    required to request an advisory opinion                will be required to serve in future years.
                                                Dominant Products                                       from the Commission regarding                            (6) The current and projected cost of
                                                AGENCY:    Postal Service.                              proposed changes in service standards                  serving Postal Service customers.
                                                                                                        of at least a substantially nationwide                   (7) The effect of changes in
                                                ACTION:   Proposed rule.                                                                                       technology, demographics, and
                                                                                                        nature under the terms of 39 U.S.C.
                                                SUMMARY: The Postal Service proposes                    3661. However, section 3691(a) sets                    population distribution on the efficient
                                                modern service standards for its market-                forth an alternative process for the                   and reliable operation of the postal
                                                dominant products. Section 301 of the                   required establishment of baseline                     delivery system.
                                                Postal Accountability and Enhancement                   modern service standards by December                     (8) The policies of [Title 39, United
                                                Act (PAEA) (codified at 39 U.S.C. 3691)                 20, 2007, stating that the Postal Service              States Code, as amended by the PAEA]
                                                requires the Postal Service, in                         is to consult with the Commission.1                    and such other factors as the Postal
                                                consultation with the Postal Regulatory                    Section 3691(b)(1) directs the Postal               Service determines appropriate.
                                                Commission (PRC), to establish by                       Service to design modern service                       120 Stat. 3218–19.
                                                regulation a set of modern service                      standards to achieve the following                     Section 1: General Background
                                                standards for market-dominant                           objectives:                                            Information on Service Standards
                                                products, no later than December 20,                       (A) To enhance the value of postal
                                                2007.                                                                                                            According to 39 U.S.C. 3621(a), as
                                                                                                        services to both senders and recipients.
                                                                                                                                                               amended by the PAEA (120 Stat. 3200),
                                                DATES: Comments must be received on                        (B) To preserve regular and effective
                                                                                                                                                               the market-dominant products for
                                                or before November 16, 2007.                            access to postal services in all                       which section 3691(a) requires the
                                                ADDRESSES: Mail written comments to                     communities, including those in rural                  establishment of modern service
                                                Modern Service Standards for Market-                    areas or where Post Offices are not self-              standards in consultation with the
                                                Dominant Products Comments, Post                        sustaining.                                            Commission include the following
                                                Office Box 23280, Washington, DC                           (C) To reasonably assure Postal                     domestic services: First-Class Mail
                                                20026–3280. You may inspect and                         Service customers delivery reliability,                Letters and Sealed Parcels, First-Class
                                                photocopy copies of all written                         speed, and frequency consistent with                   Mail Cards, Periodicals, Standard
                                                comments between 9 a.m. and 4 p.m.,                     reasonable rates and best business                     MailTM, Single-Piece Parcel Post,
                                                Monday through Friday at the Postal                     practices.                                             Media Mail, Bound Printed Matter,
                                                Service headquarters library, 11th Floor                   (D) To provide a system of objective                Library Mail, and Special Services.2
                                                North, 475 L’Enfant Plaza, SW.,                         external performance measurements for                  Section 3621(a) also designates Single-
                                                Washington, DC 20260–1540.                              each market-dominant product as a                      Piece International Mail as a market-
                                                FOR FURTHER INFORMATION CONTACT:                        basis for measurement of Postal Service                dominant product. The Postal Service
                                                Wanda Ayala 202–268–5380.                               performance. However, with the                         proposes that outbound Single-Piece
                                                SUPPLEMENTARY INFORMATION: After
                                                                                                        approval of the Commission, an internal                First-Class Mail International be
                                                stating the requirements of the law, the                measurement system may be                              included within the market dominant
                                                remainder of this notice is divided into                implemented instead of an external                     category.3
                                                five sections. Section 1 recites the                    measurement system.                                      The Postal Service defines service
                                                objectives that the Postal Service must                    See 120 Stat. 3218. Subsection 3691(c)              standards as ‘‘[a] stated goal for service
                                                satisfy and the factors that it must                    directs the Postal Service to take the                 achievement for each mail class.’’
                                                consider in establishing modern service                 following factors into account in                      Publication 32, Glossary of Postal
                                                standards, as mandated by the PAEA.                     establishing these standards:                          Terms, (May 1997, as updated with
                                                The second section summarizes the                          (1) The actual level of service that                revisions through July 2007). This
                                                customer outreach performed to                          Postal Service customers receive under                 definition forms the basis for Postal
                                                ascertain customers’ expectations                       any service guidelines previously                      Service statements and postal
                                                regarding modern service standards, and                 established by the Postal Service.                     customers’ expectations concerning the
                                                describes the Postal Service’s                             (2) The degree of customer                          number of days that it should take for
                                                consultations with the PRC. The third                   satisfaction with Postal Service                       the Postal Service to deliver a mailpiece
                                                section describes the Postal Service’s                  performance in the acceptance,
                                                proposed modern market-dominant mail                    processing, and delivery of mail.                         2 Single-Piece Parcel Post, Media Mail, Bound


                                                product service standards. Section 4                       (3) The needs of Postal Service                     Printed Matter, and Library Mail are separate
                                                                                                        customers, including those with                        products under the terms of section 3621(a). The
                                                describes how the proposed standards                                                                           service standards for these products, historically,
                                                reflect consideration of the objectives                 physical impairments.                                  have been the same. For as long as that remains the
                                                and factors listed in the law. The final                                                                       case, and for purposes of this notice and the
                                                                                                          1 Section 3691(a) explicitly acknowledges that the   regulations proposed herein, these products are
                                                section gives notice of the specific                    Postal Service may, from time to time, by regulation   collectively referred to as Package Services Mail.
                                                service standard regulations the Postal                 revise the modern service standards for market-           3 Docket No. RM2007–1, United States Postal

                                                Service is proposing to adopt and                       dominant products established though this              Service Submission of Initial Mail Classification
                                                solicits public comment.                                consultative process. Therefore, the service           Schedule in Response to Order No. 26, at 22
                                                                                                        standards that ultimately emerge at the conclusion     (September 24, 2007). The Postal Service also
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                                                Requirements of the Postal                              of this notice-and-comment rulemaking should be        proposed that, for a variety of reasons, inbound
                                                Accountability and Enhancement Act                      regarded as establishing a baseline for any            International Mail should be treated on an
                                                                                                        subsequent service changes. The Postal Service         exceptional basis and not ‘‘classified’’ within the
                                                  Section 301 of the Postal                             recognizes that any such subsequent proposals for      Mail Classification Schedule. Docket No. RM2007–
                                                Accountability and Enhancement Act                      service changes that are substantially nationwide in   1, Initial Comments of the United States Postal
                                                                                                        scope could be subject to the requirement that they    Service in Response to Order No. 26, at 13–24
                                                (codified at 39 U.S.C. 3691) requires the               be submitted to the Postal Regulatory Commission       (September 24, 2007). Accordingly, the Postal
                                                Postal Service, in consultation with the                for review in the form of a request for an advisory    Service is not proposing service standards for
                                                Postal Regulatory Commission, to                        opinion under the terms of 39 U.S.C. 3661.             inbound International Mail.



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                                                                    Federal Register / Vol. 72, No. 200 / Wednesday, October 17, 2007 / Proposed Rules                                         58947

                                                from its point of entry in the mailstream               destination. Then, a piece of First-Class             Business surveys (CSM), and the
                                                to its destination.                                     Mail deposited in a collection box                    administration of a separate consumer
                                                   The service standard for a mail                      before the last pickup time posted on                 and small business survey. Postal
                                                product consists of two related                         the collection box at origin on a Monday              Service representatives also met with
                                                elements: the day range and the                         is expected to be delivered at the                    and solicited comments from mailers at
                                                business rules. The ‘‘day range’’ is the                destination the following Wednesday,                  the National Postal Forum, from postal
                                                range of days within which all mail of                  provided that Wednesday is not a                      unions and management associations,
                                                a particular product type is expected to                holiday.                                              and from attendees at the Postal
                                                be delivered. For example, the current                     Currently, the service standard                    Service/Postal Regulatory Commission
                                                First-Class Mail service standard is often              business rules for each domestic mail                 Summit on Meeting Customer Needs in
                                                described as ranging ‘‘from one to three                product (First-Class Mail, Periodicals,               a Changing Regulatory Environment.
                                                days’’ after acceptance. As implemented                 Standard Mail, and Packages Services)                 Additionally, the Postal Service
                                                by the Postal Service, ‘‘business rules’’               vary on the basis of applicable statutory             reviewed the comments received by the
                                                determine the precise delivery day                      postal policies and such factors as:                  Commission at its three public hearings
                                                within the range that applies to a                         • The distance from the center of the              (Kansas City, Missouri; Los Angeles,
                                                specific origin-destination pair within                 origin mail processing facility s service             California; and Wilmington, Delaware)
                                                the postal mail processing network.                     area, as measured in great circle miles.              and in PRC Docket PI2007–1, Service
                                                   Presently, the domestic postal mail                     • The relative degree of expedition or             Standards and Performance
                                                processing network includes all 50                      deferability intrinsic to the mail product            Measurement For Market-Dominant
                                                states and the territories of Guam,                     in question.                                          Products.
                                                Puerto Rico and the U.S. Virgin Islands.                   • Whether the mail product is subject                 The main themes that emerged from
                                                These states and territories are divided                only to surface, or both surface and air              this outreach were that customers want
                                                into service areas, and each service area               transportation.                                       standards that are reliable, consistent,
                                                is represented by a unique 3-digit ZIP                     • The availability, speed, and relative            realistic, and attainable, and that any
                                                Code prefix. Currently, the postal                     reliability of available modes of                     proposed changes reflect sensitivity to
                                                network is divided into 915 originating                 transportation between specific nodes in              the impact of increased postal costs on
                                                3-digit ZIP Code areas and 930                          the Postal Service network.                           rates that they pay. The proposed
                                                destinating 3-digit ZIP Code areas.4                       • Whether an objectively determined
                                                                                                                                                              service standards, described in Section
                                                   As a consequence, there currently are                significant business relationship’’ exists
                                                                                                                                                              3, seek to meet these goals by aligning
                                                a total of approximately 851,000 3-digit                between a particular 3-digit ZIP Code
                                                ZIP Code origin-destination pair                                                                              standards with today’s operational and
                                                                                                        origin-destination pair.
                                                combinations in the Postal Service                         All mail designated by the same                    logistical realities, while continuing to
                                                network. The different business rules for               product name (e.g., First-Class Mail,                 differentiate among distinct products
                                                each mail product determine which of                    Periodicals, Standard Mail, or Package                and minimize any adverse impact on
                                                these origin-destination pairs are                      Services) receives the same particular                postal costs.
                                                overnight, 2-day, 3-day, etc., for each                 service standard day to a given 3-digit                  Each of the outreach methods is
                                                product. As a result, for example, a 3-                 ZIP Code origin-destination pair,                     explained in greater detail below.
                                                digit ZIP Code origin-destination pair                  irrespective of mailpiece shape or level                 1. MTAC. The Postmaster General’s
                                                with a 3-day First-Class Mail service                   of mailer presortation. Thus, within                  Mailers’ Technical Advisory Committee
                                                standard can have an 8-day delivery                     Standard Mail, the senders of cards and               (MTAC) is a venue for the Postal Service
                                                expectation for Standard Mail.5                         parcels currently expect to receive the               to share technical information with and
                                                   For purposes of counting delivery                    same level of service that is provided to             to receive advice and recommendations
                                                days, the day of entry is ‘‘day-zero,’’ if              Standard Mail flats entered at the same               from, mailers on matters concerning
                                                the mailpiece is accepted by the Postal                 origin and delivered to the same                      mail-related products and services.
                                                Service before the posted ‘‘critical entry              destination.                                          Membership in MTAC is comprised of
                                                time’’ (CET) 6 for that day. Assume, for                                                                      mailer associations and other
                                                example, that the application of the                    Section 2: Customer Outreach and                      associations/organizations related to the
                                                current First-Class Mail business rules                 Consultations With the Postal                         mailing industry. The member
                                                results in a 2-day standard from a                      Regulatory Commission                                 associations/organizations reflect the
                                                particular origin to a particular                          The law requires that the Postal                   mailing community in terms of classes
                                                                                                        Service take customer satisfaction, the               and categories of mail used and include
                                                  4 The 930 destinating service areas include the 3-
                                                                                                        needs of customers, and the actual level              both large and small volume mailers
                                                digit ZIP Code prefixes assigned to domestic Army/      of service that customers receive into                and organizations with significant or
                                                Fleet Post Office (APO/FPO) gateway processing
                                                facilities through which mail originating from or       account in the establishment of modern                unique mailing needs. MTAC has been
                                                destinating at United States overseas military          service standards. The law also requires              in existence since 1965.
                                                installations enters and exits the Postal Service       the Postal Service to develop service                    In early February 2007, a special
                                                network.                                                standards in consultation with the PRC.               MTAC workgroup was formed to
                                                  5 Each 3-digit ZIP Code service area is further
                                                                                                           Customer satisfaction, needs, and                  concentrate specifically on service
                                                divided into 5-digit ZIP Code areas that are served
                                                by particular Post Offices. Each 5-digit zone is        service have always been important to                 standards and the requirements of the
                                                further subdivided into sectors and segments that       the Postal Service. Therefore, the Postal             PAEA. The main workgroup consisted
                                                are represented by the 4-digit suffixes that are        Service was able to use a combination                 of nearly 200 participants, including
                                                elements of the ZIP+4 Codes to which each of the        of long-established methods, as well as               representatives from the Postal Service,
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                                                over 145 million domestic delivery points served by
                                                the United States Postal Service postal network are     efforts undertaken specifically because               mail users, mail service providers, and
                                                assigned. Irrespective of the 5-digit or ZIP+4TM        of the enactment of the PAEA, to reach                observers from the PRC and the General
                                                Codes assigned to particular addresses, service         out to customers. Methods included                    Accountability Office. This workgroup
                                                standards generally are established on the basis of     consultations with the Mailers’                       subdivided into four subgroups, which
                                                3-digit ZIP Code prefixes, and apply to post offices
                                                and addresses in a given 3-digit ZIP Code area.         Technical Advisory Committee (MTAC),                  focused on First-Class Mail, Periodicals,
                                                  6 For a definition of Critical Entry Time, see        review of the Postal Service’s Customer               Standard Mail, and Package Services,
                                                Section 3.                                              Satisfaction Measurement—Residential/                 respectively.


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                                                58948               Federal Register / Vol. 72, No. 200 / Wednesday, October 17, 2007 / Proposed Rules

                                                   2. Customer Satisfaction                             by type of mail, about their ratings of                  6. PRC Field Hearings. On June 12,
                                                Measurement (CSM)—Residential/                          service.                                              2007, the Commission announced that it
                                                Business. For over a decade, the Postal                    In addition to its ongoing CSM survey              would hold three public hearings as part
                                                Service has been conducting surveys to                  process, the Postal Service has                       of its development of regulations for a
                                                provide ongoing assessments of                          periodically conducted one-time                       modern postal ratemaking system. The
                                                customer experiences with Postal                        surveys to determine customer                         Commission invited different segments
                                                Service products and services, to                       expectations of service. Such surveys                 of the mailing community to testify at
                                                provide rating and diagnostic results for               have been conducted in 2001, 2006, and                three public hearings on their vision for
                                                important customer issues, to identify                  2007. The 2007 survey asked residential               a new ratemaking system and their
                                                opportunities for improvement, to                       customers, and small to medium-size                   views on delivery service standards.
                                                promote positive change by linking                      business customers, for their opinions                These hearings were held in Kansas
                                                management actions with customer                        on overall Postal Service performance,                City, Missouri (June 22, 2007); Los
                                                satisfaction, and to provide operational                and about their expectations regarding                Angeles, California (June 28, 2007); and
                                                and process-related information to the                  delivery (both in their local delivery                Wilmington, Delaware (July 9, 2007).
                                                Postal Service. Residential measurement                 area and outside their local delivery                 The Postal Service reviewed the
                                                began in 1991, and business                             area) for First-Class Mail, Parcel Post,              comments made on delivery service
                                                measurement was added in 1994.                          Periodicals (monthly and weekly                       standards and took them into account in
                                                Surveys are redesigned every two or                     magazines and national, out-of-town,                  developing its proposed modern service
                                                three years, with the survey and                        and local newspapers delivered by                     standards.
                                                analysis conducted independently by                     mail), advertising mail and flyers,                      7. Postal Service/Postal Regulatory
                                                The Gallup Organization and IBM                         Library Rate Mail, Media Mail, and                    Commission Summit Meeting on
                                                Global Business Services, respectively.                 Bound Printed Matter. Survey responses                Meeting Customer Needs in a Changing
                                                   For residential customers, the Postal                were received from approximately 6500                 Regulatory Environment. On March 13,
                                                Service surveys, on a continuous basis,                 residential and 2500 business customers               2007, the Postal Service and the
                                                randomly selected households across                     who had recently responded to the                     Commission met with mailers and other
                                                the United States. Customers have the                   Postal Services CSM survey, and then                  stakeholders to discuss various aspects
                                                option of completing the survey online                  opted to participate in additional Postal             of the recently enacted PAEA.
                                                or in hard copy. Currently, the Postal                  Service research by providing an e-mail               Approximately three hundred people
                                                Service receives completed survey                       address.                                              attended the summit. The summit
                                                questionnaires from about 250,000                          3. National Postal Forum Survey. The               included panel discussions on customer
                                                households per quarter. Responses                       National Postal Forum was held on                     needs related to market-dominant and
                                                provide direct feedback from customers                  March 25–28, 2007, in Washington, DC.                 competitive products and services the
                                                on their experiences when they visit a                  The forum is an annual conference that                PRC–USPS-designed regulatory
                                                post office, when they send and receive                 serves as an educational venue, trade                 framework, and service standards and
                                                mail, and when they contact the Postal                  show, and networking event for mailing                measurements.
                                                Service for information or to report a                  industry professionals. At this forum,                   Beginning in March 2007, the Postal
                                                problem. When responding, customers                     the Postal Service distributed a survey               Service initiated a series of regular
                                                are asked to reflect on the service they                to a group of attendees. The survey                   informational briefings with the Postal
                                                have received in the past 30 days.                      asked respondents how closely they pay                Regulatory Commissioners and their
                                                Specific to service standards and                       attention to service standards when                   technical staff to address service
                                                performance, residential customers rate                 planning mailings and what they                       standard issues on an informal basis.
                                                the Postal Service on: time for local                   thought the Postal Service should                     Members of the Postal Service Executive
                                                letters to be delivered, time for nonlocal              consider when re-evaluating its service               Committee met with Commissioners
                                                letters to be delivered, overall Postal                 standards.                                            and PRC staff monthly, beginning in
                                                Service performance, and comparison to                     4. Briefings to Labor Unions and                   May 2007, to discuss preliminary work
                                                other delivery service companies.                       Management Associations. On July 17,                  performed by the Postal Service in
                                                   For business customers, the Postal                   2007, representatives from the Postal                 developing modern service standards,
                                                Service conducts two types of surveys.                  Service held a briefing on service                    measurement systems, methods for
                                                One survey is mailed on an ongoing                      standards to which representatives from               reporting data, and customer outreach.
                                                basis to randomly selected medium- and                  all of its labor unions and management                In September 2007, the Postal Service
                                                small-size business customers who have                  associations were invited. Issues                     initiated formal consultations with the
                                                the option of responding online or by                   discussed included service standard                   Commission for the purpose of
                                                mail. Approximately 100,000 survey                      elements of the Postal Accountability                 developing modern service standard
                                                responses are received quarterly from                   and Enhancement Act and the                           proposals for each market-dominant
                                                these customers. The Postal Service also                implications for the Postal Service; the              product. The consultations regarding
                                                surveys its larger business customers via               current service standards and the rules               service standards, which were
                                                telephone or through an online response                 to create them; revenue protection; and,              concluded in October 2007, were very
                                                option to assess satisfaction with Postal               how to approach modernization.                        constructive. The Postal Service and the
                                                Service products and services. Like                        5. PRC Docket No. PI2007–1. On June                Commission found common ground on
                                                residential customers, business                         13, 2007, the PRC established Docket                  many issues and the Postal Service was
                                                customers are asked about their                         No. PI2007–1, to obtain a broad                       able to incorporate valuable suggestions
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                                                experiences with sending and receiving                  spectrum of public opinion on service                 offered by the Commission. Equally
                                                mail, but questions are tailored by                     standards and service performance                     productive meetings with the
                                                segment to address the way these                        measurement issues. The Postal Service                Commission regarding the development
                                                customers typically interact with the                   reviewed the comments received in this                of external and/or internal service
                                                Postal Service. With regard to service                  docket as it developed the proposed                   performance measurement systems
                                                standards and performance, business                     modern service standards reflected in                 under the terms of section 3691(b)(2) are
                                                customers are asked more specifically,                  this notice.                                          ongoing.


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                                                                    Federal Register / Vol. 72, No. 200 / Wednesday, October 17, 2007 / Proposed Rules                                          58949

                                                Section 3: Proposed Modern Service                      the first time, the standards reflect                    A Destination Delivery Unit (DDU) is
                                                Standards                                               consideration of the logistical                       the downstream Postal Service facility
                                                   The Postal Service began the                         challenges associated with providing                  at which mail is dispatched to carriers
                                                development of service standards for                    service to, from, and within the states of            for delivery on their routes or at which
                                                market-dominant products by                             Alaska and Hawaii, as well as the                     it is sorted to a Post Office box.
                                                                                                        territories of Guam, Puerto Rico, and the                Destination entry refers to the
                                                examining the existing standards
                                                                                                        United States Virgin Islands.                         qualified drop-shipment of bulk
                                                applicable to the matrix of nearly
                                                                                                           For special services products, each                quantities of mail at a designated postal
                                                851,000 origin-destination 3-digit ZIP
                                                                                                        service was examined to determine                     facility, either a Destination Bulk Mail
                                                Code pairs in the Postal Service network
                                                                                                        which services logically could have                   Center (DBMC), Destination Area
                                                for each mail product. For First-Class
                                                                                                        standards. Then, standards for those                  Distribution Center (DADC), Destination
                                                Mail, Periodicals, Standard Mail,
                                                                                                        services were proposed. As discussed                  Sectional Center Facility (SCF), or
                                                Package Services, and Outbound Single-
                                                                                                        further below, for certain special                    Destination Delivery Unit (DDU).
                                                Piece First-Class Mail International, the                                                                        An International Service Center (ISC)
                                                                                                        services, the establishment of a
                                                delivery service day ranges were                                                                              is a Postal Service mail processing
                                                                                                        universal service standard would be
                                                reviewed, along with the business rules                 unnecessary, redundant, or infeasible.                facility that, among other things,
                                                that determine the precise number of                       Subsection A, below, highlights some               distributes and dispatches outbound
                                                delivery days for each 3-digit ZIP Code                 of the key features of the proposed                   International Mail originating from
                                                origin-destination pair.                                modern service standards for market-                  designated 3-digit ZIP Code areas in the
                                                   As it reviewed the survey data and                   dominant mail products. Subsection B                  United States or its territories. A
                                                other information regarding customer                    describes the modern service standards                functionally equivalent International
                                                preferences described above in Section                  proposed for domestic special services.               Mail Processing Unit (IMPU) may be
                                                2, the Postal Service performed                         In some instances, the business rules for             established to serve a smaller range of
                                                extensive computer modeling to                          the proposed modern service standards                 origin 3-digit ZIP Code areas.
                                                determine how best to match its current                 refer to certain postal terminology and                  The Periodicals Origin Split and First-
                                                mail processing and transportation                      types of postal mail processing facilities.           Class Mail Mixed ADC/AADC DMM
                                                network capabilities with customer                      For purposes of clarification, the                    Label List (L201) is a 3-digit origin
                                                expectations. An internal cross-                        following brief definitions and                       sortation scheme utilized by Postal
                                                functional team was organized to define                 descriptions are provided:                            Service mail processing plants and
                                                and map standardized mail processing                       An Area Distribution Center (ADC) is               referenced in the Mailing Standards of
                                                and transportation flows for all market-                a mechanized or automated Postal                      the United States Postal Service,
                                                dominant mail products. The resulting                   Service mail processing facility that                 Domestic Mail Manual. Periodicals
                                                flows were benchmarked against                          receives and distributes mail destined                mailers use the scheme to create
                                                existing network capabilities by                        for specific 3-digit ZIP Codes within its             ‘‘origin’’ mixed ADC bundles, sacks, and
                                                utilizing internal mail processing and                  service area under a managed mail                     tubs of mail. Mixed ADC volume is
                                                transportation data systems to ensure                   program. The program identifies, on                   separated into two groups. Pieces and
                                                accuracy. Computer programs were then                   first handling, First-Class Mail that                 bundles destinating within the 3-digit
                                                written to calculate the resulting days-                cannot make next-day delivery owing to                ZIP Code ranges (surface destinations
                                                to-deliver for all of the approximately                 destination distance and eliminates a                 for First-Class Mail) listed in L201 for
                                                851,000 3-digit ZIP Code origin-                        secondary sorting for this mail, so that              the origin mail processing plant serving
                                                destination pairs, separately for each                  it can be airlifted to the destination                the customer’s mailing location are
                                                product: First-Class Mail, Periodicals,                 plant for processing during non-rush                  presorted separately, and can then be
                                                Standard Mail, and Package Services.                    hours the next day.                                   combined and processed with First-
                                                Numerous iterations of the model were                      An Automated Area Distribution                     Class Mail at the origin plant. This
                                                run to test different service standard day              Center (AADC) is a Postal Service mail                allows economies of scale to be realized
                                                ranges and business rules, and the                      distribution center that uses multiline               in mail processing, thereby both
                                                various alternative outputs were                        optical character readers, barcode                    maintaining and increasing Postal
                                                carefully analyzed. As refined potential                sorters, and other equipment designed                 Service network efficiency.
                                                outcomes were developed, they became                    for processing automation-compatible                     A Sectional Center Facility (SCF) is a
                                                the subject of consultations with the                   mail.                                                 Postal Service facility that serves as the
                                                Commission.                                                A Bulk Mail Center (BMC) is a highly               processing and distribution center/
                                                   The creation of new business rules                   mechanized Postal Service mail                        facility (P&DC/F) for Post Offices in a
                                                was a key step in the modernization of                  processing plant that distributes                     designated geographic area, as defined
                                                service standards. Business rules define                Package Services mail in piece and bulk               by the first three digits of the ZIP Codes
                                                how the mail should move through the                    form, as well as Standard Mail parcels,               of those offices. Some SCFs serve
                                                network and include precise facility-to-                and Standard Mail letters and flats in                multiple 3-digit ZIP Code areas. SCF
                                                facility highway transportation distance                bulk form. An Auxiliary Service Facility              turnaround mail has its originating and
                                                measurements. For example, the                          (ASF) is a mechanized facility, usually               destinating processing occur at the same
                                                business rules for surface products, such               part of a general mail facility, that has             Sectional Center Facility
                                                as Periodicals, Standard Mail, and                      its own service area and serves as a
                                                Package Services, allow for shared                      satellite processing hub for a particular             A. Service Standards for First-Class
                                                product transportation, which will keep                 BMC.                                                  Mail, Periodicals, Standard Mail,
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                                                transportation costs down. Where                           A Critical Entry Time (CET) is the                 Package Services, and Single-Piece
                                                appropriate, the business rules also                    latest time a particular type of mail can             First-Class Mail International
                                                recognize the deferability of Standard                  be accepted by the Postal Service in                    Current mail product service
                                                Mail. The proposed service standards                    order for it to undergo the processing                standards were originally designed to
                                                maintain the policy of requiring the                    and/or dispatch to downstream                         reflect a general end-to-end mailflow
                                                same service level for each mail class,                 operations necessary for delivery within              through the Postal Service network.
                                                irrespective of mailpiece shape. And, for               the service standard for that mail.                   However, the proliferation of


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                                                58950               Federal Register / Vol. 72, No. 200 / Wednesday, October 17, 2007 / Proposed Rules

                                                destination entry rate discounts in                     systems for the measurement of                        keep the Postal Service network
                                                Standard Mail, Periodicals, and Package                 commercial First-Class Mail,                          efficient and cost effective. For mail
                                                Services has provided incentives for                    Periodicals, and Standard Mail service                products with destination entry rate
                                                significant mailer presortation and                     performance, the Postal Service                       discounts, the Postal Service is
                                                containerized entry deeper into the                     examined internal diagnostic data, as                 proposing a new destination entry
                                                network. Today, approximately 75                        well as similar data provided by specific             service standard dimension to its
                                                percent of all Standard Mail and 70                     mailers in relation to delivery                       current origin-destination 3-digit ZIP
                                                percent of all Periodicals Mail enters the              performance they have experienced.                    Code matrices. Destination entry service
                                                Postal Service network as destination                   Such data are useful as potential                     standards have been integrated with
                                                entry mail, bypassing significant                       indicators of service performance and in              end-to-end service standards. This
                                                portions of the postal processing and                   evaluating Postal Service network                     results in more realistic and accurate
                                                transportation network. Over time, the                  capability. In addition, the Postal                   delivery expectations for all categories
                                                network has adjusted to accommodate                     Service designed an internal test which               of mailers.
                                                the many methods of mailer                              covered over 300,000 random pieces of                    For mail that both originates and
                                                worksharing and the varying degrees of                  live First-Class Mail, Periodicals, and               destinates within the contiguous 48
                                                destination entry. Both the Postal                      Standard Mail, with different                         states, no changes are proposed in the
                                                Service and Postal Service customers                    preparation levels, to track how mail                 1- to 3-day service standard range for
                                                realize that modern service standards                   flows through its network, and to help                First-Class Mail or the 3- to 10-day range
                                                need to reflect destination entry, as well              identify potential operational and                    for Standard Mail. The outer limit of the
                                                as end-to-end mail flows.                               logistical barriers to the provision of               Periodicals service standard range has
                                                   To develop modern service standards,                 reliable and consistent service.                      been expanded by 2 days, from 7 to 9
                                                the Postal Service began by examining                      Service standards and the underlying               days. This expansion more realistically
                                                data generated by the External First-                   business rules are now being adjusted to              reflects network capabilities, allows for
                                                Class (EXFC) measurement system for                     give appropriate consideration to                     efficient and economical transportation
                                                single-piece First-Class Mail, by the                   contemporary mail processing network                  routing, and will provide customers
                                                International Mail Measurement System                   capabilities and mail entry practices.                with more reliable and consistent
                                                for outbound Single-Piece First-Class                   Business rules for the end-to-end                     service. The outer limit of the service
                                                Mail International, and by its Product                  product flow have been developed to                   standard day range for Package Services
                                                Tracking System for Single-Piece Parcel                 accurately depict the need to                         is narrowed by 1 day, from 9 to 8 days,
                                                Post, Media Mail, Bound Printed Matter,                 consolidate and share both processing                 for the same reasons. These day ranges
                                                and Library Mail. In the absence of                     and transportation resources in order to              are summarized in the table below.




                                                  *The table above reflects service                     for the proposed end-to-end service                   Guam, Puerto Rico, and the U.S. Virgin
                                                standard day ranges for the 48                          standard day ranges for the states of                 Islands.
                                                contiguous states. See the table below                  Alaska and Hawaii, and the territories of
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                                                                    Federal Register / Vol. 72, No. 200 / Wednesday, October 17, 2007 / Proposed Rules                                          58951




                                                   The service standards for mail to and                for a ship to travel from port to port                Islands (USVI), between Puerto Rico and
                                                from addresses in the states of Alaska                  between origin and destination. The                   Hawaii, or between Guam and all points
                                                and Hawaii and the territories of Guam,                 extended day ranges reflect the limited               other than Hawaii. Additional
                                                Puerto Rico, and the U.S. Virgin Islands                availability of economical surface                    transportation time is allotted on a case-
                                                have been designed using the same mail                  transportation options and the logistical             by-case basis to reflect the logistics
                                                processing concepts. However,                           challenges present.                                   required to serve these areas.
                                                transporting mail to and from (and                         The modern service standard day                       In addition to the end-to-end service
                                                sometimes within) these locations                       ranges for mail to and/or from these                  standards, a separate matrix has been
                                                presents significant challenges, many of                states and territories is depicted above.             developed to depict the service
                                                which the Postal Service cannot control.                The lower end of the day range                        standards for those market-dominant
                                                For mail products that rely exclusively                 illustrates the service expectation for               mail products that include destination
                                                on interstate or interterritorial surface               local mail, while the higher end of the               entry mail: Periodicals, Standard Mail,
                                                transportation, for example, the                        day range represents the expectation for              and Package Services. For the
                                                proposed service standard day ranges                    mail traveling between the most extreme               contiguous 48 states, these destination
                                                reflect transportation availability and                 origin-destination pairs, for example:                entry standards are summarized in the
                                                the number of days that it is expected                  between Alaska and the U.S. Virgin                    table below.
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                                                58952               Federal Register / Vol. 72, No. 200 / Wednesday, October 17, 2007 / Proposed Rules




                                                  The destination entry standards are                   territories of Guam, Puerto Rico, and the
                                                summarized in the table below for the                   U.S. Virgin Islands.
                                                states of Alaska and Hawaii and the




                                                  The service standard origin or                        (Alaska); San Juan SCF (Puerto Rico and               transportation of First-Class Mail letters
                                                destination for mail to or from the states              USVI); and Honolulu SCF (Hawaii and                   on a particular flight to a remote area
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                                                of Alaska and Hawaii and Guam, Puerto                   Guam). This is necessary because                      may be deferred in favor of Package
                                                Rico, and the U.S. Virgin Islands, is                   transportation beyond these entry/exit                Services Mail containing groceries or
                                                                                                                                                                                                           EP17OC07.002</GPH> EP17OC07.003</GPH>




                                                defined to/from the 3-digit ZIP Code                    points becomes increasingly                           medicine, where transportation space is
                                                area in which the interstate/                           challenging, increasing the variability in            insufficient to carry both products.
                                                interterritorial gateway mail processing                service performance achieved. For                        The proposed service standards for
                                                facility is located: Anchorage SCF                      example, in the state of Alaska,                      these states and territories also reflect
                                                                                                                                                              local operating plans developed in


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                                                                    Federal Register / Vol. 72, No. 200 / Wednesday, October 17, 2007 / Proposed Rules                                         58953

                                                response to different logistical                        total market-dominant mail volume will                customers can have more realistic
                                                challenges that affect each state or                    have a service standard in the 1- to 5-               expectations and more consistent and
                                                territory. For instance, factors in the                 day range, 10.1 percent will have a                   reliable service.
                                                state of Alaska that contribute to the                  service standard in the 6- to 10-day                    The following is a summary of the
                                                need for longer, more realistic, service                range, and 0.1 percent will have a                    proposed modern service standard day
                                                standard day ranges include: the                        service standard greater than 10 days.                ranges and underlying business rules for
                                                reliance on infrequently scheduled                        Postal Service customers interested in              market-dominant mail. It bears
                                                cargo ships to and from ports in the                    determining what the service standard                 repeating that, where the application of
                                                contiguous 48 states, the absence of                    would be for a mail product from any                  a particular business rule for a
                                                intrastate roads to many remote                         particular 3-digit ZIP Code origin to any             particular mail product indicates a
                                                locations, the infrequency of available                 3-digit ZIP Code destination, assuming                range of possible delivery days, only a
                                                surface transportation, the extraordinary               the adoption of the service standard day              single day within that range applies to
                                                geographical reach of the 3-digit ZIP                   ranges and business rules proposed                    a particular 3-digit ZIP Code origin-
                                                Code service areas in the state, and the                herein, may examine a file which can be               destination pair.
                                                necessary reliance on irregular air and                 accessed at the following Internet link:
                                                                                                                                                              1. First-Class Mail
                                                hovercraft transportation in lieu of                    http://ribbs.usps.gov/svcstandardsprop.
                                                standard commercial trucking and air                    By product (First-Class Mail,                            Domestic First-Class Mail is sealed
                                                service between many locations.                         Periodicals, Standard Mail, and Package               against inspection and typically consists
                                                Extraterritorial mail for Guam is routed                Services) and by origin 3-digit ZIP Code              of such matter as bills, statements of
                                                through Hawaii; extraterritorial mail for               service area, the file provides a list of all         account, solicitations, personal
                                                the U.S. Virgin Islands is routed through               destination 3-digit ZIP Code service                  correspondence and greetings, or other
                                                Puerto Rico. The time-in-transit and the                areas for which the service standard                  personal information that is wholly or
                                                limited availability of cargo ship                      would, for example, be 1, 2, 3, or 4, etc.,           partially handwritten or typewritten.
                                                capacity between the contiguous 48                      days. In addition, the file contains the              The proposed modern First-Class Mail
                                                states and Hawaii and Puerto Rico                       applicable service for each destination               service standard day range appears
                                                significantly affect end-to-end transit                 entry product from point of entry to                  below. First-Class Mail utilizes both air
                                                times for mail dependent on surface                     destination 3-digit ZIP Code.                         and surface transportation. The
                                                transportation, as does the availability                  Whether mail originates or destinates               expected delivery day after the Critical
                                                of interisland shipping within Hawaii.                  on one of the islands of Hawaii or on                 Entry Time for any origin-destination 3-
                                                   The service standard day ranges                      Long Island in New York, modern                       digit ZIP Code pair depends on mail
                                                depicted in the tables above must be                    service standards should reflect rational             processing operating plans, the distance
                                                viewed in the context of the estimated                  operating plans in light of available,                between origin and destination, and
                                                impact. Based on FY 2006 domestic                       reasonably economical, and efficient                  transportation times between processing
                                                volumes, an estimated 89.7 percent of                   logistical options. In that way,                      plants.
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                                                58954               Federal Register / Vol. 72, No. 200 / Wednesday, October 17, 2007 / Proposed Rules
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                                                                    Federal Register / Vol. 72, No. 200 / Wednesday, October 17, 2007 / Proposed Rules                                        58955




                                                  An estimated 99.7 percent of First-                   other similar publications. The                       depends on the level of destination
                                                Class Mail will have a service standard                 proposed modern Periodicals service                   entry, mail processing operating plans,
                                                in the 1- to 3-day range, and 0.3 percent               standard day range appears below.                     distance between origin and destination,
                                                will have a 4- to 5-day service standard.               Periodicals Mail utilizes surface                     and transportation times between
                                                2. Periodicals                                          transportation. The expected delivery                 processing plants.
                                                                                                        day after the Critical Entry Time for any
                                                   This domestic mail typically consists                origin-destination 3-digit ZIP Code pair
                                                of qualified newspapers, magazines, and
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                                                58956               Federal Register / Vol. 72, No. 200 / Wednesday, October 17, 2007 / Proposed Rules
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                                                                                                                                                                                EP17OC07.007</GPH>




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                                                                    Federal Register / Vol. 72, No. 200 / Wednesday, October 17, 2007 / Proposed Rules                                          58957




                                                  An estimated 92.4 percent of                          publication that is required to be                    plants, and consideration of the
                                                Periodicals will have a service standard                entered as Periodicals Mail). The                     deferrable nature of the product. The
                                                in the 1- to 4-day range; 7.2 percent will              proposed modern Standard Mail service                 proposed business rules incorporate
                                                have a service standard in the 5- to 9-                 standard day range appears below.                     determinations defining specifically
                                                day range; and 0.4 percent will have a                  Standard Mail utilizes surface                        where in the mail flow for Standard
                                                service standard greater than 9 days.                   transportation. The expected delivery                 Mail the product may be deferred for up
                                                3. Standard Mail                                        day after the Critical Entry Time for any             to one day. For origin-entry mail, this
                                                                                                        origin-destination 3-digit ZIP Code pair              occurs at the Postal Service mail
                                                   Any mailable matter weighing less
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                                                                                                        depends on the level of destination                   processing facility designated as the
                                                than 16 ounces may be mailed
                                                domestically as Standard Mail (except                   entry, mail processing operating plans,               origin consolidation site; for
                                                matter that is required to be mailed as                 distance between origin and destination,              destination-entry mail, this occurs at the
                                                First-Class Mail or copies of a                         transportation times between processing               destination delivery unit.
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                                                58958               Federal Register / Vol. 72, No. 200 / Wednesday, October 17, 2007 / Proposed Rules
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                                                                                                                                                                                EP17OC07.010</GPH>




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                                                                    Federal Register / Vol. 72, No. 200 / Wednesday, October 17, 2007 / Proposed Rules                                        58959




                                                   An estimated 79.6 percent of Standard                for matter required to be entered as                  expected delivery day after the Critical
                                                Mail will have a service standard in the                First-Class Mail, Periodicals, or                     Entry Time for any origin-destination 3-
                                                2- to 5-day range, 20.2 percent will have               Standard Mail, as specified by the Postal             digit ZIP Code pair depends on the level
                                                a service standard in the 6- to 10-day                  Service). The proposed modern Package                 of destination entry, mail processing
                                                range, and 0.2 percent will have a                      Services (Single-Piece Parcel Post,                   operating plans, Bulk Mail Center/
                                                service standard greater than 10 days.                  Media Mail, Bound Printed Matter and                  Auxiliary Service Facility (BMC/ASF)
                                                4. Package Services                                     Library Mail) service standard day range              processing relationships, distance
                                                                                                        appears below. Package Services Mail                  between origin and destination, and
                                                   Any domestic mailable matter may be
                                                entered as Package Services mail, except                utilizes surface transportation. The                  inter-BMC/ASF transportation times.
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                                                58960               Federal Register / Vol. 72, No. 200 / Wednesday, October 17, 2007 / Proposed Rules
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                                                                                                                                                                                EP17OC07.012</GPH>




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                                                                    Federal Register / Vol. 72, No. 200 / Wednesday, October 17, 2007 / Proposed Rules                                        58961




                                                  An estimated 70.6 percent of Package                  Code to the 3-digit ZIP Code area in                     • Address Correction Service
                                                Services mail will have a service                       which that origin’s designated                        involves the transmission of corrected
                                                standard in the 1- to 4-day range, 29.1                 International Service Center or                       address information to senders, when
                                                percent will have a service standard in                 International Mail Processing Unit is                 recipients to whom they have sent a
                                                the 5- to 8-day range, and 0.3 percent                  located.                                              specific mailpiece provide a forwarding
                                                will have a service standard greater than                                                                     address to the Postal Service.
                                                8 days.                                                 B. Domestic Special Services                          Information is provided either through
                                                5. Outbound Single-Piece First-Class                    1. Summary of Services                                automated or hardcopy notification,
                                                Mail International Letters and Flats                                                                          depending on the type of service
                                                                                                          There are two categories of domestic                requested.
                                                   Outbound Single-Piece First-Class                    special services: ancillary, and stand-                  • Business Reply Mail, Merchandise
                                                Mail International has been defined as                  alone.                                                Return, and Bulk Parcel Return are
                                                a separate product by the Postal Service                  Ancillary special services are                      alternate postage payment methods
                                                in its proposed Mail Classification                     purchased for a fee in addition to the                established for bulk mail recipients.
                                                Schedule.7 The proposed service                         postage applicable to First-Class Mail,               Postage is paid through a postal account
                                                standard day range for outbound Single-                 Periodicals, Standard Mail, Single-Piece              funded by the recipient for pieces that
                                                Piece First-Class Mail International                    Parcel Post, Bound Printed Matter,                    are mailed without postage fixed.
                                                letters and flats is equivalent to the
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                                                                                                        Library Mail, or Media Mail. These                    Return pieces may be First-Class Mail or
                                                service standard for domestic First-Class               optional, ancillary special services are              Package Services, as allowed for those
                                                Mail from the same origin 3-digit ZIP
                                                                                                        varied in nature. Some may be                         services. Shipper Paid Forwarding is an
                                                  7 PRC Docket No. RM2007–1, United States Postal
                                                                                                        purchased only for specific mail                      alternate postage payment method for
                                                Service Submission of Initial Mail Classification
                                                                                                        products or mailpiece shapes. The                     bulk mailers who establish accounts to
                                                Schedule in Response to Order No. 26, at 22             following is a summary of the ancillary               cover postage, when parcels directed to
                                                                                                                                                                                                         EP17OC07.013</GPH>




                                                (September 24, 2007).                                   services:                                             addressees specified by the shipper


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                                                58962               Federal Register / Vol. 72, No. 200 / Wednesday, October 17, 2007 / Proposed Rules

                                                need to be forwarded to different                       transportation of First-Class Mail and                addressed mail at a postal facility call
                                                addresses designated by the recipients.                 Package Services.                                     window or loading dock, at times
                                                Fees in addition to postage are paid for                   • Stamped Envelopes, Stationery and                arranged between the recipient and the
                                                these various accounting related                        Cards are articles that can serve as                  postal facility.
                                                services.                                               philatelic items or be used as postage-                  • Change of Address Credit Card
                                                   • Certified Mail serviceTM provides                  paid mailpieces.                                      Authentication is a service through
                                                the sender a mailing receipt and access                    A principal feature of a number of                 which a Change of Address notice
                                                to electronic information regarding the                 ancillary special services is the                     submitted via the Internet or by
                                                delivery status of a mailpiece.                         electronic provision of information by
                                                                                                                                                              telephone is authenticated by reference
                                                   • A Certificate of Mailing provides a                the Postal Service to the sender
                                                                                                                                                              to the credit card number provided by
                                                receipt to the sender as evidence that a                regarding the status of a particular
                                                                                                                                                              the requester.
                                                mailpiece was accepted by the Postal                    mailpiece. That information may consist
                                                Service.                                                of confirmation that delivery was either                 • Confirm is a subscription service
                                                   • Collect on Delivery involves postal                attempted or completed, a copy of the                 that enables customers who apply the
                                                collection of payment for merchandise                   recipient’s signature, or information on              appropriate barcode to their mail to
                                                ordered by the recipient, and                           address corrections of applicable                     receive information concerning passive
                                                transmission of the recipient s payment                 mailpieces.                                           scans of that mail captured by
                                                to the sender.                                             For a number of these ancillary                    automated postal mail sortation
                                                   • Delivery ConfirmationTM service                    services, delivery-related information is             equipment while the mail is in transit
                                                provides the sender access to electronic                generated by Postal Service scanning of               between acceptance and delivery.
                                                information regarding the delivery                      mailpieces at delivery units or during                   • Money Orders are financial
                                                status of a mailpiece.                                  carrier delivery. Before the completion               instruments that can be used,
                                                   • Insurance services provide senders                 of daily work shifts, Postal Service                  independently of whether they are
                                                indemnity in the event of loss or                       delivery personnel dock their portable                mailed, to transfer monetary funds
                                                damage to the contents of mailpieces.                   hand-held scanners, so that delivery                  between parties.
                                                   • Parcel Airlift Service provides for                information pertinent to each scanned                    • Post Office Box service provides a
                                                air transportation of Standard Mail                     mailpiece can be uploaded and                         customer with a locked postal
                                                parcels on a space available basis to or                transmitted to appropriate Postal                     receptacle for the receipt of mail as an
                                                from U.S. military Post Offices outside                 Service data systems. New scanners                    alternative to delivery at the recipient s
                                                the contiguous 48 states.                               currently being deployed allow for                    street address.
                                                   • Registered Mail service provides                   signatures to be scanned at the time of
                                                added security for a mailpiece from                     delivery and transmitted with the                        Many mail products, as well as
                                                acceptance to delivery, and indemnity                   delivery information. Automated                       ancillary and stand-alone special
                                                in case of loss or damage in transit.                   address correction of applicable                      services, are purchased at Post Office
                                                   • Return Receipt service provides the                mailpieces is performed passively by                  retail windows. As described above,
                                                sender with evidence that a mailpiece                   certain automated Postal Service mail                 some special services are completed
                                                has been received at the delivery                       sortation equipment that then transmits               during the course of the window
                                                address, including the original or copy                 information to Postal Service systems.                transaction. However, retail window
                                                of the recipient s signature. The receipt               Information from these various Postal                 transactions do not constitute market-
                                                is either in the form of a First-Class Mail             Service data systems is then made                     dominant special services within the
                                                card returned to the sender or                          available to the purchaser of the special             meaning of subsection 3621(a)(9) for
                                                electronically transmitted information.                 service.                                              which service standards must be
                                                   • Restricted Delivery service permits                   In contrast to these ancillary services,           established under section 3691.
                                                the sender to direct that a mailpiece be                stand-alone special services are not                  Accordingly, the Postal Service
                                                delivered to a particular person at the                 contingent upon the sending or receipt                proposes no service standards in
                                                delivery address (or that person’s                      of a particular mailpiece:                            relation to window service transactions
                                                designated agent for the receipt of mail).                 • Address List Services are available              during which mail products or special
                                                   • Signature ConfirmationTM service                   to mailers seeking correction of the                  services can be purchased.
                                                provides delivery status information,                   addresses or ZIP Codes on their mailing               2. Proposed Service Standards for
                                                plus the name and signature of the                      lists, or the sequencing of their                     Domestic Special Services
                                                recipient who signed for the piece upon                 addresses. The corrected addresses are
                                                delivery.                                               then used by mailers to create and send                 The table below, which summarizes
                                                   • Special Handling provides                          mail.                                                 the modern service standards proposed
                                                preferential handling to the extent                        • Caller Service provides an                       for various special services, is followed
                                                practicable in dispatch and                             alternative means of receiving properly               by a discussion of each.
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                                                                    Federal Register / Vol. 72, No. 200 / Wednesday, October 17, 2007 / Proposed Rules                                          58963




                                                a. Address List Services                                the expected information. Accordingly,                intended to abrogate current
                                                                                                        modern service standards will include                 arrangements in individual Confirm
                                                  The Postal Service currently has a                    an objective expectation of availability              Service Agreements regarding the
                                                standard operating procedure for                        of delivery scan information for the                  frequency of batching, transmission, or
                                                completing customer requests for                        following ancillary special services                  earlier availability of such data.
                                                Election Board Address Changes,                         products: Delivery Confirmation,
                                                Corrections and ZIP Coding of Lists, and                Signature Confirmation, Certified Mail,               c. Insurance Claims Processing
                                                Sequencing of Address Cards. The                        Registered Mail, electronic Return                       A vital element of postal insurance is
                                                Postal Service proposes making this                     Receipt, and Collect on Delivery. For                 the timeliness of the Postal Service’s
                                                standard operating procedure the                        Confirm, the modern service standard                  resolution of indemnity claims filed by
                                                modern service standard for these                       will be an objective expectation of                   customers. Accordingly, as a modern
                                                services. This standard would require                   availability of Confirm scan information              service standard, the Postal Service
                                                that, except for the period between                     obtained from mailpieces. For Address                 proposes that a decision should be
                                                November 16 and January 1, the Postal                   Correction services provided                          transmitted to the claimant no later than
                                                Service return the corrected addresses                  electronically, the modern service                    30 days after the date on which the
                                                within 15 workdays. The exclusion of                    standard will be an objective                         Postal Service has received all
                                                the November 16 to January 1 time                       expectation for availability of address               information from the claimant necessary
                                                period is due to the impact of the surge                correction information obtained in                    for resolution of the claim.
                                                of holiday mail volume on Postal                        relation to specific mailpieces from the
                                                Service personnel ordinarily responsible                customer’s mailing. For these special                 d. Post Office Box Service
                                                for fulfilling these requests within the                services, the Postal Service proposes                    An essential element of Post Office
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                                                15-workday period.                                      that delivery information, Confirm                    Box service is the timely availability of
                                                b. Information Services for Ancillary                   scans, or address correction                          mail by the posted ‘‘uptime.’’ The
                                                and Stand-Alone Services                                information, as appropriate, be                       ‘‘uptime’’ is the time of day by which
                                                                                                        accessible online to the sender within                customers can expect to collect from
                                                  A critical element of the various                     24 hours of the time-stamp of the scan.               their Post Office Box the mail that has
                                                mailpiece delivery information services                 The Postal Service emphasizes that the                been received for delivery that day. On
                                                                                                                                                                                                          EP17OC07.014</GPH>




                                                and Confirm is the timely provision of                  proposed 24-hour standard is not                      the basis of local mail processing plans


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                                                58964               Federal Register / Vol. 72, No. 200 / Wednesday, October 17, 2007 / Proposed Rules

                                                and standard operating procedures, each                 return to destination. Accordingly, there             request, not for the subsequent
                                                Post Office Box section is required to                  is no justification for establishing                  processing of that request. The
                                                establish and publicly post its standard                independent service standards for the                 authentication service is provided and
                                                ‘‘uptime’’ for each delivery day.                       reply, returned, or forwarded portions of             completed at the time that the credit
                                                Accordingly, the Postal Service                         the respective mailstreams through                    card is validated and the fee is debited.
                                                proposes that the modern service                        which such pieces flow.                               The Postal Service does not consider it
                                                standard for Post Office Box service be                                                                       necessary or feasible to establish an
                                                                                                        c. Caller Service
                                                mail availability by the posted daily                                                                         objective standard for the timely
                                                ‘‘uptime.’’                                                Caller Service provides a means for                completion of the authentication which
                                                                                                        (usually high volume) mail recipients to              takes place during a telephone or
                                                3. Special Services Products for Which                  receive their mail at a postal retail
                                                No Independent Service Standards Are                                                                          Internet transaction.
                                                                                                        window or loading dock. From origin to
                                                Being Proposed                                          delivery availability, the mail picked up             f. Money Orders
                                                   As explained below, there are certain                by the customer is subject to the                        As with Stamped Cards and
                                                special services for which the                          standards for each class.                             Stationery, and entirely at the option of
                                                establishment of a universal service                       Daily Caller Service pickup times are              the purchaser, Postal Money Orders may
                                                standard would be unnecessary,                          arranged between the delivery office                  be enclosed in, for example, First-Class
                                                redundant or infeasible. Accordingly,                   and the mail recipient. These pickup                  Mail pieces. Such enclosures do not
                                                the Postal Service interprets subsection                times may be pre-arranged or may be on                affect the application of the First-Class
                                                3691(a) as not requiring the                            an ‘‘on-call’’ basis. They often vary from            Mail service standards for such mail.
                                                establishment of service standards for                  posted Post Office Box section                        Once a Postal Money Order is
                                                the following special services, based                   ‘‘uptimes’’ and many Caller Service                   purchased, the Postal Service does not
                                                upon their present characteristics.                     customers arrange for multiple pickups                necessarily have anything further to do.
                                                                                                        on a given day. Thus, in contrast to Post             For these reasons, the Postal Service
                                                a. Address Correction Service
                                                                                                        Office Box service, there is no one                   concludes that there is no mandate in
                                                   Mailers seeking to maintain up-to-                   posted daily ‘‘uptime’’ standard by                   section 3691 to establish service
                                                date mailing lists can purchase Address                 which all Caller Service, either system               standards for Postal Money Orders.
                                                Correction Service, in order to receive                 wide or at a particular Post Office, is
                                                updated forwarding address information                  offered. Accordingly, it is infeasible to             g. Return Receipt (Hard-Copy)
                                                submitted to the Postal Service by                      establish a service standard for Caller                  After delivery of the mailpiece to
                                                addressees. Unlike delivery scan data                   Service pickup.                                       which it was affixed, a hard-copy
                                                that mailers request at acceptance and                                                                        Return Receipt card is returned by the
                                                expect to receive with every delivery,                  d. Certificate of Mailing
                                                                                                                                                              Postal Service to its purchaser via First-
                                                ACS data are expected by the sender                        A Certificate of Mailing is provided to            Class Mail. The First-Class Mail service
                                                only for those mailpieces which require                 the sender by the Postal Service as an                standard for the 3-digit ZIP Code pair in
                                                the Postal Service to use its mail                      intrinsic element of the acceptance of                question (from destination back to
                                                forwarding address database to deliver                  the mailpiece for which it was                        origin) governs the return transit.
                                                the mailpiece, and then transmit the                    purchased. The purchase of the                        Accordingly, no independent service
                                                new delivery address to the sender.                     certificate is ancillary to sending a First-          standards should be developed for the
                                                Manual ACS information is batched,                      Class Mail letter or Single-Piece Parcel              Return Receipt portion of the First-Class
                                                and the frequency with which it is                      Post package, for example, and does not               Mail stream.
                                                transmitted to the purchasers of ACS                    affect the delivery service standards
                                                varies on the methods employed, as                      otherwise applicable to those pieces.                 h. Special Handling, Restricted
                                                well as specific arrangements between                   Provision of the certificate at the time of           Delivery, and Parcel Airlift
                                                the Postal Service and particular                       mailing is a part of the acceptance of the               A critical element of Parcel Airlift
                                                customers. Accordingly, unlike delivery                 mailpiece for which the certificate is                Service, Restricted Delivery, and Special
                                                scan data, there is no one standard time                purchased and completes the special                   Handling is that each product is
                                                by which all ACS subscribers expect the                 service. Accordingly, the Postal Service              purchased subject to the explicit
                                                requested data to be available.                         sees no means or need for a standard                  understanding that the requested
                                                Additionally, there is no one availability              measuring the timely completion of this               preferential handling, transportation
                                                standard that applies to all ACS                        special service.                                      upgrade, or delivery restriction is
                                                subscribers served by the same Post                                                                           subject to availability. At the time when
                                                                                                        e. Change of Address Credit Card
                                                Office. For these reasons, no service                                                                         these services are purchased, it cannot
                                                                                                        Authentication
                                                standard is proposed.                                                                                         be known whether the processing or
                                                                                                           Change of Address Authentication                   transportation upgrade can be
                                                b. Alternate Postage Payment Methods                    service provides a customer with a                    accommodated, or whether some
                                                   Business Reply Mail, Merchandise                     means of having the Postal Service                    delivery policy exception or limitation
                                                Return, and Bulk Parcel Return are                      verify their address using standard                   applicable to the delivery address
                                                alternate postage payment methods                       Address Verification Service (AVS), by                overrides the requested delivery
                                                established for bulk mail recipients.                   reference to a credit card number the                 restriction. Accordingly, the
                                                Shipper Paid Forwarding is an alternate                 customer provides when they submit a                  establishment of service standards for
                                                postage payment method for bulk                         Change of Address request via                         these conditional service offerings is
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                                                mailers. Mail subject to these alternate                telephone or the Internet. This                       unwarranted.
                                                postage payment methods has the same                    authentication service is an alternative
                                                delivery service standards for the                      to the customer completing a hard-copy                i. Stamped Envelopes, Cards, and
                                                applicable mail product (e.g., First-Class              Change of Address request form. The                   Stationery
                                                Mail or Single-Piece Parcel Post) as                    customer pays a fee for the credit card                  When used, for example, as First-
                                                would any other mailpiece from the                      authentication associated with the                    Class Mail pieces or enclosures,
                                                same point of entry, forwarding, or                     telephone or Internet Change of Address               Stamped Envelopes, Cards, and


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                                                                    Federal Register / Vol. 72, No. 200 / Wednesday, October 17, 2007 / Proposed Rules                                                 58965

                                                Stationery are subject to the service                   integrated with ‘‘end-to-end’’ mail flows             reasonable rates and best business
                                                standards that apply to other First-Class               to enhance the value of mailer                        practices.
                                                Mail pieces. Accordingly, no                            worksharing, in a clear and easy-to-use                 The Postal Service proposes to adjust
                                                independent service standards should                    format. Standard Mail deferability has                service standard day ranges based on
                                                be developed for these products.                        been incorporated into the service                    consistent and modern business rules,
                                                                                                        standard day ranges and business rules,               not only to meet customer needs and
                                                Section 4: The Proposed Modern                          to reduce the potential for cumulative                expectations, but also to conform to the
                                                Service Standards Reflect                               local deferral decisions that can result              capabilities of the current mail
                                                Consideration of Relevant Statutory                     in unpredictable delivery times. In light             processing and transportation network.
                                                Objectives and Factors                                  of recent mail shifts from First-Class                Accordingly, the Postal Service expects
                                                A. The Statutory Objectives                             Mail to Standard Mail, preservation of                that customers will experience more
                                                                                                        clear distinctions between the service                reliable service, with reasonable levels
                                                   As indicated above, subsection
                                                                                                        standards for the different mail classes              of speed consistent with the relative
                                                3691(b)(1) requires the Postal Service to
                                                                                                        (to reflect different service levels) will            degrees of expedition and priority in
                                                achieve certain specified objectives in
                                                                                                        enhance value, consistency, and                       processing that are intrinsic to each
                                                establishing its modern service
                                                                                                        reliability and allow customers to                    market-dominant mail product. Such an
                                                standards. At the same time, subsection
                                                                                                        continue to make informed choices                     approach is consistent with the goal of
                                                3691(c) requires that the modern service
                                                                                                        regarding the service level desired. The              preserving reasonable rates and
                                                standards reflect consideration of a list
                                                                                                        proposed new time-sensitive service                   conforms to best business practices.
                                                of enumerated factors. The proposed                                                                             (D)—To provide a system of objective
                                                                                                        standards for many special services will
                                                service standards reflect limitations                   give customers clearer expectations                   external performance measurements for
                                                inherent in network capabilities, the                   about the services offered, which will                each market-dominant product as a
                                                mail processing environment, and                        enhance the value of those services.                  basis for measurement of Postal Service
                                                transportation. As such, they reflect                      (B)—To preserve regular and effective              performance.
                                                customer interest in standards that                     access to Postal Service services in all                In accordance with subsection
                                                establish reasonable expectations for                   communities including those in rural                  3691(b)(2), the Postal Service is
                                                when mail should be delivered. Service                  areas or where Post Offices are not self-             continuing to meet with the Postal
                                                standard day ranges based on great                      sustaining.                                           Regulatory Commission regarding the
                                                circle mile zone bands are being set                       Long-standing Postal Service policy                employment of a hybrid mix of external
                                                aside in favor of ranges based on precise               has been to provide regular and effective             and internal service performance
                                                facility-to-facility highway                            access to postal services in all                      measurement systems.8 The Postal
                                                transportation distance measurements.                   communities, whether urban or rural,                  Service anticipates that these very
                                                Destination entry service standards have                without regard to whether post offices at             constructive meetings will lead to the
                                                been created to recognize the impact of                 particular origins or destinations are                development of systems that generate
                                                major advances in mailer worksharing                    self-sustaining. The proposed market-                 data sufficiently reliable and robust for
                                                on Postal Service mail processing and                   dominant service standards adhere to                  the management of its market-dominant
                                                delivery capability. More realistic day                 this objective. Service standard day                  mail and special services products, that
                                                ranges have also been established for                   ranges have been extended for the states              keep postal customers reasonably
                                                mail originating from, or destinating to,               of Alaska and Hawaii and the territories              informed about the quality of service
                                                the states of Alaska and Hawaii and the                 of Guam, Puerto Rico, and the U.S.                    provided, and that permit the
                                                territories of Guam, Puerto Rico, and the               Virgin Islands. These changes reflect the             Commission to fulfill its regulatory
                                                U.S. Virgin Islands. These day ranges                   Postal Service’s goal of seeking to satisfy           functions, in a manner that minimizes
                                                more accurately reflect the significant                 customers’ desire for greater consistency             harm to the Postal Service’s commercial
                                                logistical challenges and limited                       and reliability on the basis of more                  interests. Further details regarding the
                                                availability of economical transportation               realistic mail processing and                         nature of these service performance
                                                options that affect service for these                   transportation plans. The proposed day                measurement systems will be reflected
                                                states and territories.                                 ranges more accurately reflect the                    in the Postal Service report to Congress
                                                   Below, the Postal Service explains                   significant logistical challenges and                 detailing its network plan and
                                                how the modern service standards                        limited availability of economical                    operational objectives that will be
                                                described above and its plans for service               transportation options for these service              implemented to meet the service
                                                performance measurement to achieve                      areas. The consultations with the Postal              standards proposed in this notice. That
                                                the objectives of subsection 3691(b).                   Regulatory Commission confirmed that                  network plan will be developed after
                                                   (A)—To enhance the value of Postal                   both agencies share a sensitivity to the              further consultations with the
                                                Service services to both senders and                    needs of customers in these states and                Commission, and the network plan
                                                recipients.                                             territories. As with the contiguous 48                report will be submitted to Congress on
                                                   The value of postal services to both                 states, service standard proposals are                or before June 20, 2008, in accordance
                                                senders and recipients is enhanced                      not influenced by whether any portion                 with PAEA section 302.
                                                when the service standards for those                    of any state or territory may be regarded
                                                services are clear and reflect a balanced               as urban or rural, or the degree to which             B. The Statutory Factors
                                                consideration of reasonable customer                    any Post Offices are self-sustaining.                   As is demonstrated below, the
                                                expectations and the capabilities of the                Additionally, it should be observed that              proposed modern service standards also
                                                mail processing and transportation                      some special services are accessible                  reflect a thorough consideration of the
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                                                networks. By aligning the proposed                      online 24 hours a day, seven days a
                                                standards with operational capabilities,                week, which allows customers access                     8 An ‘‘external’’ service performance

                                                the Postal Service can provide reliable,                regardless of the location in the Postal              measurement system would be one operated by a
                                                consistent service, and properly fulfill                Service network.                                      non-Postal Service entity; an ‘‘internal’’ system
                                                                                                                                                              would be one operated by the Postal Service. Under
                                                the service expectations of both senders                   (C)—To reasonably assure Postal                    the terms of subsection 3691(b)(2), with the
                                                and recipients. Destination entry                       Service customers delivery reliability,               approval of the Commission, the Postal Service may
                                                standards have been created and                         speed, and frequency consistent with                  employ internal systems.



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                                                58966               Federal Register / Vol. 72, No. 200 / Wednesday, October 17, 2007 / Proposed Rules

                                                enumerated factors in subsection                          of mail delivered later than the                    customer preference for minimizing
                                                3691(c).                                                  applicable standard.                                changes in service levels that could
                                                   (1)—The actual level of service that                 —Destination entry service standards                  have an adverse impact on Postal
                                                Postal Service customers receive under                    should be incorporated where such                   Service costs for these mail products.
                                                any service guidelines previously                         rate incentives exist.                                 (3)—The needs of Postal Service
                                                established by the Postal Service or                    —Service standards should vary on the                 customers, including those with
                                                service standards established under this                  basis of seasonality to accommodate                 physical impairments.
                                                section.                                                  the impact of the holiday mailing                      The Postal Service serves different
                                                   As described previously, early in its                  season.                                             types of customers, with varying needs.
                                                review of current service standards, the                —Service standards for deferrable                     To ensure that its diverse stakeholders
                                                Postal Service examined data generated                    Standard Mail should reflect ‘‘in-                  were heard, as explained above in
                                                by the External First-Class (EXFC)                        home’’ delivery day ranges in lieu of               Section 2, the Postal Service used a
                                                measurement system for single-piece                       specific delivery day targets, and                  combination of long-established
                                                First-Class Mail, its Product Tracking                    performance should be measured on                   customer outreach methods, as well as
                                                System for Package Services, as well as                   the basis of compliance with                        efforts resulting specifically from the
                                                data generated by its special services                    requested ‘‘in-home’’ delivery day                  enactment of the PAEA. The Postal
                                                delivery and en-route mailpiece scan                      ranges.                                             Service consulted with the Mailers’
                                                data systems, and its Customer                          —Service improvements and costs                       Technical Advisory Committee (MTAC)
                                                Satisfaction Measurement system. In the                   should be balanced.                                 and reviewed the Postal Service’s
                                                absence of a system for the                                                                                   Customer Satisfaction Measurement—
                                                                                                          The proposed service standards take
                                                measurement of Periodicals and                                                                                Residential/Business surveys (CSM).
                                                                                                        into account technology deployments                   The Postal Service also met with and
                                                Standard Mail service performance, the                  and destination entry mailing practices
                                                Postal Service examined internal                                                                              solicited comments from mailers at the
                                                                                                        that have emerged in the past few                     Postal Service/Postal Regulatory
                                                diagnostic data, as well as similar data                decades, as well as standardized mail
                                                provided by specific mailers in relation                                                                      Commission Summit on Meeting
                                                                                                        processing flows that have been                       Customer Needs in a Changing
                                                to actual delivery performance they                     developed for each market-dominant
                                                have experienced.                                                                                             Regulatory Environment, and at the
                                                                                                        mail product. As a result, the proposed               semi-annual National Postal Forum.
                                                   Such data are valuable as potential                  standards are based upon current
                                                indicators of service performance. In                                                                         Additionally, the Postal Service
                                                                                                        network capabilities. This should                     reviewed the comments solicited by the
                                                addition, as discussed earlier, the Postal              ensure better consistency and reliability
                                                Service tracked over 300,000 live                                                                             Commission at its three public hearings,
                                                                                                        in the delivery of mail, and give                     held in Kansas City, Missouri; Los
                                                mailpieces to examine how mail flowed                   customers a more realistic picture of                 Angeles, California; and Wilmington,
                                                through its network and to help identify                Postal Service delivery capabilities. By              Delaware. Comments received in PRC
                                                potential operational bottlenecks and                   adopting standards based on actual                    Docket PI2007–1, Service Standards and
                                                logistical barriers to the provision of                 network capabilities and what is                      Performance Measurement For Market-
                                                reliable and consistent mail service. The               realistically attainable, the Postal                  Dominant Products, also were reviewed.
                                                Postal Service also gathered information                Service expects to provide more                       The Postal Service also solicited input
                                                from customers using the methods                        consistent and reliable service, and to               from postal unions, management
                                                described in the discussion above in                    reduce the ‘‘tail’’ of the mail. For                  associations, as well as through a
                                                Section 2 of this notice and below in                   Standard Mail, the Postal Service                     consumer and small business survey.
                                                reference to the next factor. All of this               prefers the establishment of service                     Examples of customers’ concerns and
                                                information provided a foundation from                  standards that reflect specific day                   how they were addressed are detailed in
                                                which the Postal Service could assess                   targets, as opposed to a range of ‘‘in-               reference to subsection 3691(c)(2) above.
                                                current levels of service.                              home’’ delivery days for each origin-                 Of course, not every customer proposal
                                                   (2)—The degree of customer                           destination 3-digit ZIP Code pair. The                could be accepted. Recommendations
                                                satisfaction with Postal Service                        Postal Service will collaborate with a                that ran contrary to the policies of Title
                                                performance in the acceptance,                          mailing industry workgroup to further                 39, or that did not appear to reflect a
                                                processing, and delivery of mail.                       explore the needs of mailers who                      balanced consideration of all of the
                                                   The Postal Service used a                            request ‘‘in-home’’ delivery dates. And,              factors discussed here, were set aside.
                                                combination of long-established                         rather than adopt service standard day                   The PAEA also requires that the
                                                customer outreach methods and efforts                   ranges or business rules that vary during             Postal Service take into account the
                                                resulting specifically from the                         the year, the Postal Service considers                needs of customers with physical
                                                enactment of the PAEA to determine the                  that the concerns underlying such                     impairments. 39 CFR 255.1 implements
                                                degree of customer satisfaction in the                  proposals are more appropriate for                    section 504 of the Rehabilitation Act of
                                                acceptance, processing, and delivery of                 consideration in the determination of                 1973, as amended. Section 504 prohibits
                                                mail. Regarding service standards, the                  performance goals, one of the subjects of             discrimination on the basis of disability
                                                main recommendations were that                          the upcoming network plan                             in programs or activities conducted by
                                                service standards should be reliable,                   consultations under PAEA section                      the Postal Service. The Postal Service is
                                                consistent, realistic, and attainable, and              302(b)(1). In the development of those                not proposing to adopt any service
                                                that any proposed changes reflect                       performance goals, the Postal Service                 standards or service standard changes
                                                sensitivity to the impact of increased                  will work with mailers to determine                   that work to the disadvantage of
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                                                postal costs on rates that customer pay.                what types of goals would best address                customers with a disability.
                                                Examples of other suggestions included:                 the issue of seasonality.                                (4)—Mail volume and revenues
                                                —Existing service standard guidelines                     The proposed modern standards                       projected for future years.
                                                   should serve as a baseline for                       preserve the differences in service levels               The Postal Service examined recent
                                                   developing modern standards.                         among the different market-dominant                   mail volume and revenue trends for
                                                —Measures should be taken to reduce                     mail products. In addition, the                       each market-dominant product, as
                                                   the ‘‘tail’’ of the mail, the percentage             standards reflect consideration of                    reflected in its quarterly Revenue Pieces


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                                                                    Federal Register / Vol. 72, No. 200 / Wednesday, October 17, 2007 / Proposed Rules                                             58967

                                                & Weight/Origin-Destination                             time to reflect those advances. Mail                  regarding current standards or proposals
                                                Information System. The Postal Service                  processing capacity in the Postal Service             for change. The Postal Service also will
                                                also reviewed its Docket No. R2006–1                    network must constantly be adjusted in                give due consideration to its obligation
                                                test year volume projections. These data                response to geographic shifts in both                 to formally request advisory opinions
                                                suggest that prudent decision-making is                 population and the level of mail-                     from the PRC regarding any changes
                                                necessary if the Postal Service is to meet              generating economic activity. The Postal              which may be at least ‘‘substantially
                                                customer expectations at reasonable                     Service must continue to improve the                  nationwide’’ in scope, under the terms
                                                costs, especially in light of the price                 flexibility of its network for this reason.           of 39 U.S.C. 3661.
                                                increase constraints on market-                         The proposed service standards reflect
                                                dominant products enacted as the                        reasonable goals in light of the current              Section 5: Request for Comment
                                                centerpiece of modern ratemaking and                    network and technological advances                      It is emphasized that the proposed
                                                the alternatives available for all market-              that are expected in the nearterm.                    regulations are being published for
                                                dominant mail products.                                 Sophisticated network mapping and                     comments and are subject to revision
                                                   (5)—The projected growth in the                      transportation management tools now                   based on the comments received and
                                                number of addresses the Postal Service                  permit the Postal Service to manage and               further consideration by the Postal
                                                will be required to serve in future years.              adjust its operations to meet service                 Service. Although exempt from the
                                                   The Postal Service expects continued                 goals more efficiently. The Postal                    notice and comment requirements of the
                                                growth in the number of delivery                        Service has taken into account the                    Administrative Procedure Act [5 U.S.C.
                                                addresses it must serve. Accordingly,                   advent of Flats Sequencing System                     553 (b), (c)] regarding proposed rule
                                                the Postal Service considered this factor               technology and advances in mailpiece                  making by 39 U.S.C. 410 (a), the Postal
                                                in conjunction with the impact that                     scanning technology to continue to                    Service invites public comments on
                                                such growth could have on the                           refine service management. Careful                    these proposed regulations.
                                                feasibility of providing service at                     coordination will be necessary between
                                                reasonable costs, in light of the current               the implementation of the network plan                List of Subjects in 39 CFR Parts 121 and
                                                mail mix and volume trends. In                          mandated by PAEA section 302 and the                  122
                                                developing the proposed modern                          service standard changes proposed here                  Postal Service.
                                                service standards, the Postal Service                   to ensure that efficiency and reliability               For the reasons stated in the
                                                took a conservative approach to change,                 of service are improved.                              preamble, the Postal Service proposes to
                                                in light of a shifting mail mix that                       (8)—The policies of this title and such            amend 39 CFR Chapter I, Subchapter C,
                                                generates less revenue per piece as First-              other factors as the Postal Service                   as follows:
                                                Class Mail volume declines. Revenue                     determines appropriate.                                 1. The heading of subchapter C is
                                                trends affect the Postal Service’s ability                 The Postal Service has been                        revised to read as follows:
                                                to expend capital and require it to                     established to operate as a basic and
                                                ensure that its operations are designed                 fundamental service to the American                   Subchapter C—General Information on
                                                to more efficiently deliver fewer pieces                public. Management of the national                    Postal Products
                                                per address to a growing number of                      postal system involves the balancing of                 2. Parts 121 and 122 are added are
                                                addresses.                                              important service and operational                     added to read as follows:
                                                   (6)—The current and projected future                 objectives, including promptness,
                                                cost of serving Postal Service customers.               reliability, and efficiency [39 U.S.C.                PART 121—SERVICE STANDARDS
                                                   As highlighted above, in view of the                 101(a)]. To achieve these objectives, the             FOR MARKET-DOMINANT MAIL
                                                constraints on price increases that are                 Postal Service is empowered to                        PRODUCTS
                                                imposed on market-dominant products,                    determine the methods and to deploy                   Sec.
                                                it is more important than ever that costs               the personnel necessary to conduct its                121.1 First-Class Mail.
                                                associated with these services be                       operations [39 U.S.C. 1001(e)]. At the                121.2 Periodicals.
                                                contained. At the same time, great care                 same time, the Postal Service is charged              121.3 Standard Mail.
                                                must be taken to ensure that necessary                  with operating and maintaining such                   121.4 Package Services.
                                                cost containment does not disturb                       facilities and equipment as are                       121.5 Outbound Single-Piece First-Class
                                                customer service expectations.                          necessary to pursue these objectives [39                   Mail International Letters and Flats.
                                                Accordingly, in determining the degree                  U.S.C. 401(6)]. These considerations                    Authority: 39 U.S.C. 101, 401, 403, 404,
                                                of adjustment to the current service                    have weighed heavily in the                           1001, 3691.
                                                standards for market-dominant                           development of the modern service
                                                products, the Postal Service was                        standards proposed here. An improved                  § 121.1    First-Class Mail.
                                                mindful of recent cost trends associated                alignment between service standards                      (a) For all intra-Sectional Center
                                                with these services, as well as available               and current mail processing operational               Facility (SCF) First-Class Mail properly
                                                cost projections for these products. The                capabilities and limitations should                   accepted before the day-zero Critical
                                                Postal Service attempted to strike a                    prove beneficial in many respects.                    Entry Time at origin, the service
                                                reasonable balance between desired                         After the establishment of baseline                standard is 1-day (overnight), except for
                                                customer service and the need to                        modern service standards as a result of               mail between the territories of Puerto
                                                contain costs.                                          this rulemaking, the Postal Service                   Rico and the U.S. Virgin Islands and
                                                   (7)—The effect of changes in                         intends to place a high priority on                   intra-SCF mail originating and
                                                technology, demographics, and                           annual internal review of the service                 destinating in the following 3-digit ZIP
                                                population distribution on the efficient                standard day ranges and business rules                Code areas in the state of Alaska: 996,
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                                                and reliable operation of the Postal                    for its market-dominant products. The                 997, 998, and 999. First-Class Mail
                                                Service delivery system.                                Postal Service expects to consider the                addressed to a destination 3-digit ZIP
                                                   There have been significant advances                 aforementioned statutory factors as a                 Code area outside of an origin intra-SCF
                                                in mail processing technology and                       part of any such internal review. As a                service area may be considered for
                                                postal transportation over the past                     part of this review, the Postal Service,              overnight delivery from that origin SCF,
                                                several decades. Mail processing                        at its discretion, may solicit either                 if that mail is accepted before the day-
                                                procedures have been adjusted over                      informal or formal public comment                     zero Critical Entry Time at origin, if


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                                                58968               Federal Register / Vol. 72, No. 200 / Wednesday, October 17, 2007 / Proposed Rules

                                                sufficient customer need exists [the                    Alaska, the state of Hawaii, or the                      (b) Destination Entry. (1) Periodicals
                                                destination SCF receives at least 1.5                   territory of the U.S. Virgin Islands;                 that qualify for a Destination Delivery
                                                percent of the total annual First-Class                    (3) The origin and delivery address                Unit (DDU) or Destination Sectional
                                                Mail volume originating from the origin                 are in different states or territories,               Center Facility (DSCF) discount, and
                                                Processing & Distribution Center/                       excluding mail to and from the territory              that are accepted before the day-zero
                                                Facility (OPDC/F)], and if operational                  of Guam and mail between the                          Critical Entry Time at the proper DDU
                                                and transportation feasibility permit.                  territories of Puerto Rico and the U.S.               or DSCF, have a 1-day (overnight)
                                                   (b) A 2-day service standard is                      Virgin Islands.                                       service standard, except for mail
                                                established for all First-Class Mail                       (e) A 5-day service standard is                    dropped at the SCF in the territory of
                                                properly accepted before the day-zero                   established for all remaining First-Class             Puerto Rico and destined for the
                                                Critical Entry Time at origin if a 1-day                Mail properly accepted before the day-                territory of the U.S. Virgin Islands, and
                                                service standard is not required and if                 zero Critical Entry Time at origin if                 intra SCF mail in the following 3-digit
                                                the origin PDC/F to Area Distribution                   either the origin or the delivery address             ZIP Code areas of the state of Alaska:
                                                Center surface transportation drive time                is in the territory of Guam.                          996, 997, 998 and 999.
                                                is 12 hours or less, unless the origin and                                                                       (2) Periodicals that qualify for a
                                                                                                        § 121.2    Periodicals.
                                                destination are within the state of                                                                           Destination Area Distribution Center
                                                                                                           (a) End-to-End. (1) For all SCF                    (DADC) discount, and that are accepted
                                                Alaska; or if the origin and delivery
                                                                                                        turnaround Periodicals properly                       before the day zero Critical Entry Time
                                                address are separately in the territories
                                                                                                        accepted before the established and                   at the proper DADC, unless the ADC is
                                                of Puerto Rico and the U.S. Virgin
                                                                                                        published day-zero Critical Entry Time                located with the 48 contiguous states
                                                Islands; or if the mail is intra-SCF and
                                                                                                        at origin, where the origin P&DC/F and                and the destination is not, and where
                                                originating or destinating one of the
                                                                                                        SCF are in the same building, the                     the DADC and DSCF are not the same
                                                following 3-digit ZIP Code areas in
                                                                                                        service standard is 1-day (overnight),                building, have a 2-day service standard,
                                                Alaska: 996, 997, 998, and 999.
                                                   (c) A 3-day service standard is                      except for mail between the territories of            unless the ADC is located within the
                                                established for all remaining First-Class               Puerto Rico and the United States Virgin              contiguous 48 states and the destination
                                                Mail properly accepted before the day-                  Islands and mail originating or                       is not. Mail that qualifies for a
                                                zero Critical Entry Time at origin, if                  destinating in the following 3-digit ZIP              Destination Sectional Center Facility
                                                neither a 1-day nor a 2-day service                     Code areas within the state of Alaska:                (DSCF) discount has a 2-day service
                                                standard is required and:                               996, 997, 998, and 999.                               standard, if it is accepted before the day-
                                                   (1) Both the origin SCF and the                         (2) The Periodicals service standard is            zero Critical Entry Time, and the mail
                                                delivery address are within the                         the sum of the applicable (1- to 3-day)               is dropped at the SCF in the territory of
                                                contiguous 48 states;                                   First-Class Mail service standard plus                Puerto Rico and is destined for the
                                                   (2) The origin SCF is in the                         one day, for each 3-digit ZIP Code                    territory of the U.S. Virgin Islands; or if
                                                contiguous 48 states, and the delivery                  origin-destination pair for which                     the mail is intra-SCF in the following 3-
                                                address is in either of the following: the              Periodicals are accepted before the day-              digit ZIP Code areas of the state of
                                                995 3-digit ZIP Code area (including                    zero Critical Entry Time at origin and                Alaska: 996, 997, 998 and 999.
                                                Anchorage AK), or the 968 3-digit ZIP                   merged with First-Class Mail for surface                 (3) Periodicals that qualify for a
                                                Code area (including Honolulu, HI), or                  transportation (as defined by the                     Destination Area Distribution Center
                                                in the 006, 007, or 009 3-digit ZIP Code                Periodicals Origin Split and First-Class              (DADC) discount and that are accepted
                                                areas of the territory of Puerto Rico;                  Mail mixed Area Distribution Center/                  before the day zero Critical Entry Time
                                                   (3) The origin is in the 006, 007 or 009             Automated Area Distribution Center                    at the proper DADC in the contiguous
                                                3-digit ZIP Code areas of the territory of              (ADC/AADC) Domestic Mail Manual                       48 states for delivery to addresses in the
                                                Puerto Rico and the delivery address is                 label list L201). This standard also                  state of Alaska, or the territories of
                                                in the contiguous 48 states;                            applies to Periodicals mailed between                 Guam or the U.S. Virgin Islands, have a
                                                   (4) The origin SCF is in the state of                the territories of Puerto Rico and the                service standard of either 6 or 7 days,
                                                Hawaii and the delivery address is in                   U.S. Virgin Islands between the state of              depending on the origin-destination 3-
                                                the territory of Guam; the origin is in the             Hawaii and the territory of Guam and                  digit ZIP Code pair. For each such pair,
                                                territory of Guam and the delivery                      between SCFs within Alaska.                           the applicable day within the range is
                                                address is in the state of Hawaii; or                      (3) The Periodicals service standard               based on the number of days required
                                                   (5) Both the origin SCF and the                      for each remaining 3-digit ZIP Code                   for transportation outside of the 48
                                                delivery address are within the state of                origin-destination pair within the 48                 contiguous states.
                                                Alaska.                                                 contiguous states, for which Periodicals
                                                   (d) A 4-day service standard is                      are accepted before the day-zero Critical             § 121.3    Standard Mail.
                                                established for all remaining First-Class               Entry Time at origin, is the sum of 4 or                (a) End-to-End. (1) The service
                                                Mail properly accepted before the day-                  5 days, plus the number of additional                 standard for Sectional Center Facility
                                                zero Critical Entry Time at origin, if                  days (from 1 to 4) required for surface               (SCF) turnaround Standard Mail
                                                either a 1-day, 2-day, or 3-day service                 transportation between each 3-digit ZIP               accepted at origin before the day zero
                                                standard is not required, and if:                       Code origin-destination pair.                         Critical Entry Time is 3 days when the
                                                   (1) The origin SCF is in the                            (4) The Periodicals service standard               origin Processing & Distribution Center/
                                                contiguous 48 states and the delivery                   for each remaining 3-digit ZIP Code                   Facility (OPD&C/F) and the SCF are the
                                                address is in either of the following: any              origin-destination pair, for which                    same building, except for mail between
                                                portion of the state of Alaska not in the               Periodicals are accepted before the day-              the territories of Puerto Rico and the
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                                                995 3-digit ZIP Code area; or any                       zero Critical Entry Time at origin, is the            U.S. Virgin Islands.
                                                portion of the state of Hawaii not in the               sum of 4 or 5 days, plus the number of                  (2) The service standard for Area
                                                968 3-digit ZIP Code area; or the                       additional days (from 4 to 18) required               Distribution Center (ADC) turnaround
                                                territory of the U.S. Virgin Islands.                   for intermodal (highway, boat, air-taxi)              Standard Mail accepted at origin before
                                                   (2) The delivery address is in the                   transportation outside of the 48                      the day zero Critical Entry Time is 4
                                                contiguous 48 states and the origin is in               contiguous states for each 3-digit ZIP                days when the OPD&C/F and the ADC
                                                either of the following: The state of                   Code origin-destination pair.                         are the same building, unless the ADC


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                                                                    Federal Register / Vol. 72, No. 200 / Wednesday, October 17, 2007 / Proposed Rules                                          58969

                                                is in the contiguous 48 states and the                  day zero Critical Entry Time at the                   transportation between each 3-digit ZIP
                                                delivery address is not, or when the                    proper DBMC has a 5-day service                       Code origin-destination pair, plus an
                                                mail is between the territories of Puerto               standard, if both the origin and the                  additional day if the destination
                                                Rico and the U.S. Virgin Islands.                       destination are in the 48 contiguous                  delivery address is served by an
                                                   (3) The service standard for intra-Bulk              states.                                               Auxiliary Service Facility.
                                                Mail Center (BMC) Standard Mail                            (5) Standard Mail that qualifies for a
                                                                                                                                                                 (5) For each remaining 3-digit ZIP
                                                accepted at origin before the day zero                  Destination Area Distribution Center
                                                                                                                                                              Code origin-destination pair for which
                                                Critical Entry Time is 5 days for each                  (DADC) or Destination Bulk Mail Center
                                                                                                                                                              either the origin or the destination is
                                                remaining 3-digit ZIP Code origin-                      (DBMC) discount and that is accepted
                                                                                                                                                              outside of the 48 contiguous states, the
                                                destination pair within the same Bulk                   before the day zero Critical Entry Time
                                                Mail Center service area if the origin                  at the proper DADC or DBMC in the                     service standard for Package Services
                                                and destination are within the                          contiguous 48 states for delivery to                  mail accepted at origin before the day
                                                contiguous 48 states; the same standard                 addresses in the states of Alaska or                  zero Critical Entry Time is between 7
                                                applies to mail that is intra-Alaska,                   Hawaii or the territories of Guam,                    and 22 days. For each such 3-digit ZIP
                                                intra-Hawaii, or between the state of                   Puerto Rico, or the U.S. Virgin Islands               Code origin-destination pair, this
                                                Hawaii and the territory of Guam.                       has a service standard of either 8, 9, or             represents the sum of 4 days, plus the
                                                   (4) For each remaining 3-digit ZIP                   10 days, depending on the 3-digit                     number of days (ranging between 3 to
                                                Code origin-destination pair within the                 origin-destination ZIP Code pair. For                 18) required for intermodal (highway,
                                                48 contiguous states, the service                       each such pair, the applicable day                    boat, air-taxi) transportation between
                                                standard for Standard Mail accepted at                  within the range is based on the number               each 3-digit ZIP Code origin-destination
                                                origin before the day zero Critical Entry               of days required for transportation                   pair.
                                                Time is the sum of 6 days plus the                      outside of the 48 contiguous states.                     (b) Destination Entry. (1) Package
                                                number of additional days (from 1 to 4)                                                                       Services mail that qualifies for a
                                                required for surface transportation                     § 121.4    Package Services.
                                                                                                                                                              Destination Delivery Unit (DDU)
                                                between each 3-digit ZIP Code origin-                     (a) End-to-End. (1) The service                     discount and that is accepted before the
                                                destination pair.                                       standard for Sectional Center Facility                day zero Critical Entry Time at the
                                                   (5) For each remaining 3-digit ZIP                   (SCF) turnaround Package Services mail                proper DDU has a 1-day (overnight)
                                                Code origin-destination pair, the service               accepted at the origin SCF before the                 service standard.
                                                standard for Standard Mail accepted at                  day zero Critical Entry Time is 2 days
                                                origin before the day zero Critical Entry               when the origin Processing &                             (2) Package Services mail that
                                                Time is the sum of 6 days plus the                      Distribution Center/Facility and the SCF              qualifies for a Destination Sectional
                                                number of additional days (from 4 to 18)                are the same building, except for mail                Center Facility (DSCF) discount and that
                                                required for intermodal (highway, boat,                 between the territories of Puerto Rico                is accepted before the day zero Critical
                                                air-taxi) transportation outside of the 48              and the U.S. Virgin Islands.                          Entry Time at the proper DSCF has a
                                                contiguous states for each 3-digit ZIP                    (2) The service standard for intra-Bulk             2-day service standard, except for mail
                                                Code origin-destination pair.                           Mail Center (BMC) Package Services                    dropped at the SCF in Puerto Rico and
                                                   (b) Destination Entry. (1) Standard                  mail accepted at origin before the day                destined for the U.S. Virgin Islands.
                                                Mail that qualifies for a Destination                   zero Critical Entry Time is 3 days, for                  (3) Package Services mail that
                                                Delivery Unit (DDU) discount and that                   each remaining (non-intra-SCF) 3-digit                qualifies for a Destination Bulk Mail
                                                is accepted before the day zero Critical                ZIP Code origin-destination pair within               Center (DBMC) discount, which is
                                                Entry Time at the proper DDU has a 2-                   a Bulk Mail Center service area, where                accepted before the day zero Critical
                                                day service standard.                                   the origin and destination is within the              Entry Time at the proper DBMC or
                                                   (2) Standard Mail that qualifies for a               contiguous 48 states and is not served                Destination Auxiliary Service Facility,
                                                Destination Sectional Center Facility                   by an Auxiliary Service Facility; for                 and that originates and destinates in the
                                                (DSCF) discount and that is accepted                    mail between the territories of Puerto                contiguous 48 states, has a 3-day service
                                                before the day zero Critical Entry Time                 Rico and the U.S. Virgin Islands.                     standard. Mail that qualifies for a
                                                at the proper DSCF has a 3-day service                    (3) The service standard for intra-Bulk             Destination Sectional Center Facility
                                                standard, except for mail dropped at the                Mail Center (BMC) Package Services                    (DSCF) discount, and that is accepted
                                                SCF in the territory of Puerto Rico and                 mail accepted at origin before the day                before the day zero Critical Entry Time
                                                destined for the territory of the U.S.                  zero Critical Entry Time is 4 days for                at the SCF in Puerto Rico, has a 3-day
                                                Virgin Islands.                                         each remaining 3-digit ZIP Code origin-               service standard if it is destined for the
                                                   (3) Standard Mail that qualifies for a               destination pair within a Bulk Mail                   U.S. Virgin Islands.
                                                Destination Area Distribution Center                    Center service area, where the
                                                (DADC) discount, and that is accepted                   destination delivery address is served                   (4) Package Services mail that
                                                before the day zero Critical Entry Time                 by an Auxiliary Service Facility; the                 qualifies for a Destination Bulk Mail
                                                at the proper DADC, has a 4-day service                 same standard applies to all remaining                Center (DBMC) discount and that is
                                                standard, unless the ADC is in the                      intra-Alaska mail and mail between the                accepted before the day zero Critical
                                                contiguous 48 states and the destination                state of Hawaii and the territory of                  Entry Time at the proper DBMC in the
                                                delivery address is not. Mail that                      Guam.                                                 contiguous 48 states for delivery to
                                                qualifies for a Destination Sectional                     (4) For each remaining 3-digit ZIP                  addresses in the states of Alaska or
                                                Center Facility (DSCF) discount, and                    Code origin-destination pair within the               Hawaii, or the territories of Guam,
                                                that is accepted before the day zero                    48 contiguous states, the service                     Puerto Rico, or the U.S. Virgin Islands
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                                                Critical Entry Time at the SCF in the                   standard for Package Services mail                    has a service standard of either 6, 7, or
                                                territory of Puerto Rico, has a 4-day                   accepted at origin before the day zero                8 days, depending on the 3-digit ZIP
                                                service standard if it is destined for the              Critical Entry Time is between 5 and 8                Code origin-destination pair. For each
                                                U.S. Virgin Islands.                                    days. For each such 3-digit ZIP Code                  such pair, the applicable day within the
                                                   (4) Standard Mail that qualifies for a               origin-destination pair, this is the sum              range is based on the number of days
                                                Destination Bulk Mail Center (DBMC)                     of 4 days, plus the number of additional              required for transportation outside of
                                                discount and that is accepted before the                days (from 1 to 4) required for surface               the 48 contiguous states.


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                                                58970               Federal Register / Vol. 72, No. 200 / Wednesday, October 17, 2007 / Proposed Rules

                                                § 121.5 Outbound Single-Piece First-Class               provision of delivery-related                         available for pickup at the box each
                                                Mail International Letters and Flats.                   information is that it be made available              delivery day no later than the daily ‘‘up-
                                                   The service standard for properly                    to the sender no later than 24 hours after            time’’ publicly posted at the Post Office
                                                accepted outbound Single-Piece First-                   the time of the recorded delivery-related             in which the box section is located.
                                                Class Mail International letters and flats              scan performed by the Postal Service:
                                                is equivalent to the service standard for                                                                        (b) The service standard for
                                                                                                        Certified Mail, Delivery Confirmation,
                                                domestic First-Class Mail from the same                                                                       completion of Address List Services
                                                                                                        Registered Mail, electronic Return
                                                origin 3-digit ZIP Code to the 3-digit ZIP                                                                    (change-of-address information for
                                                                                                        Receipt, and Signature Confirmation.
                                                Code area in which that origin’s                           (2) For electronic Address Correction              election boards and registration
                                                designated International Service Center                 Service, the service standard for the                 commissions, correction and ZIP Coding
                                                or International Mail Processing Unit is                electronic provision of forwarding                    of mailing lists, and address sequencing)
                                                located.                                                address information is that it be made                is transmission of the corrected
                                                                                                        available to the sender no later than 24              addresses within 15 workdays of receipt
                                                PART 122—SERVICE STANDARDS                              hours after the time of the recorded                  to the requester, except for the period
                                                FOR MARKET-DOMINANT DOMESTIC                            forwarding of the mailpiece by the                    from November 16 through January 1.
                                                SPECIAL SERVICES PRODUCTS                               Postal Automated Redirection System.                     (c) For the domestic market-dominant
                                                Sec.                                                       (b) For the domestic market-dominant               mail products identified in part 121 of
                                                122.1     Ancillary Special Services.                   mail products identified in part 121 of               this chapter, Confirm service allows
                                                122.2     Stand-Alone Special Services.                 this chapter, mailers may purchase                    subscribing customers to obtain
                                                  Authority: 39 U.S.C. 101, 401, 403, 404,              insurance from the Postal Service to                  electronic information regarding when
                                                1001, 3691.                                             provide indemnity against loss or                     and where mailpieces undergo barcode
                                                                                                        damage to the contents of a mailpiece.                scans in mail processing operations. The
                                                § 122.1    Ancillary Special Services.                  The service standard for the
                                                  (a) For the domestic market-dominant                                                                        service standard for the electronic
                                                                                                        administrative resolution of insurance
                                                mail products identified in part 121 of                                                                       provision of Confirm scan information
                                                                                                        claims is that a final agency decision
                                                this chapter, mailers may purchase                      must be transmitted to the claimant no                is that it be made available to the sender
                                                various ancillary special services                      later than 30 days after the date on                  no later than 24 hours after the recorded
                                                products, which are designed to provide                 which the Postal Service has received                 time of the Confirm scan performed by
                                                electronic access to information                        all information from the claimant                     the Postal Service.
                                                regarding delivery-related events or                    necessary for analysis of the claim.                  Stanley F. Mires,
                                                forwarding addresses for individual
                                                                                                        § 122.2    Stand-Alone Special Services.              Chief Counsel, Legislative.
                                                mailpieces.
                                                  (1) For the following special services,                 (a) The service standard for Post                   [FR Doc. 07–5065 Filed 10–16–07; 8:45 am]
                                                the service standard for the electronic                 Office Box service is that mail be                    BILLING CODE 7710–12–P
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