81 FR 95071 - Statutory Review of the System for Regulating Market Dominant Rates and Classifications
POSTAL REGULATORY COMMISSION Federal Register Volume 81, Issue 248 (December 27, 2016)
Federal Register Volume 81, Issue 248 (December 27, 2016)
| Page Range | 95071-95074 | |
| FR Document | 2016-31052 |
[Federal Register Volume 81, Number 248 (Tuesday, December 27, 2016)] [Proposed Rules] [Pages 95071-95074] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2016-31052] ----------------------------------------------------------------------- POSTAL REGULATORY COMMISSION 39 CFR Part 3622 [Docket No. RM2017-3; Order No. 3673] Statutory Review of the System for Regulating Market Dominant Rates and Classifications AGENCY: Postal Regulatory Commission. ACTION: Advance notice of proposed rulemaking. ----------------------------------------------------------------------- SUMMARY: The Commission is initiating a review to determine whether the current system of regulating rates and classes for market dominant products is achieving the objectives, taking into account the factors, established by Congress under the Postal Accountability and Enhancement Act of 2006. This advance notice informs the public of the docket's initiation, invites public comment, and takes other administrative steps. DATES: Comments are due: March 20, 2017. ADDRESSES: Submit comments electronically via the Commission's Filing Online system at http://www.prc.gov. Those who cannot submit comments electronically should contact the person identified in the FOR FURTHER INFORMATION CONTACT section by telephone for advice on filing alternatives. FOR FURTHER INFORMATION CONTACT: David A. Trissell, General Counsel, at 202-789-6820. SUPPLEMENTARY INFORMATION: Table of Contents I. Introduction II. Scope of the Review III. Review Framework IV. Objectives V. Notice of Commission Action VI. Ordering Paragraphs I. Introduction On December 20, 2006, the Postal Accountability and Enhancement Act (PAEA) was signed into law.\1\ The PAEA required that the Commission establish a modern system of regulating rates and classes for market dominant products.\2\ The PAEA also mandated that the Commission review this system 10 years later to determine if it is achieving the objectives, taking into account the factors, established by Congress.\3\ If the Commission determines that the system is not achieving the objectives, taking into account the factors, the Commission may, by regulation, make modifications or adopt an alternative system as necessary to achieve the objectives. Id. --------------------------------------------------------------------------- \1\ Pub. L. 109-435, 120 Stat. 3198 (2006). \2\ 39 U.S.C. 3622(a). \3\ 39 U.S.C. 3622(d)(3). --------------------------------------------------------------------------- In accordance with 39 U.S.C. 3622, this Notice and Order establishes the beginning of the Commission's statutory review of the ratemaking system. Based on the Commission's analysis and relevant information obtained through this proceeding, the Commission will determine if the objectives, taking into account the factors, are being achieved by the current system. If the Commission finds that the objectives, taking into account the factors, are not being achieved, the Commission may propose modifications to the system or propose to adopt an alternative system as necessary to achieve the objectives. II. Scope of the Review 4 --------------------------------------------------------------------------- \4\ The Postal Service previously petitioned the Commission to initiate a proceeding to clarify the scope of the statutory review. See Docket No. RM2016-9, Petition of the United States Postal Service for the Initiation of a Proceeding to Clarify the Scope of the Review of the System for Regulating Market-Dominant Rates and Classes, April 7, 2016. In Order No. 3237, the Commission found the petition premature and held the petition in abeyance pending the start of the review. See Docket No. RM2016-9, Order No. 3237, Order Holding Petition in Abeyance, April 12, 2016. The Commission defines the scope of the review at this time. --------------------------------------------------------------------------- The Commission intends to examine all aspects of the ratemaking system [[Page 95072]] provided within section 3622, including the annual limitation on the percentage changes in rates,\5\ the schedule for rate changes,\6\ the 45-day notice before the implementation of rate adjustments,\7\ expedited rate changes due to extraordinary or exceptional circumstances,\8\ class level application of the annual limitation,\9\ the rounding of rates and fees,\10\ the use of unused rate authority,\11\ and workshare discounts.\12\ --------------------------------------------------------------------------- \5\ 39 U.S.C. 3622(d)(1)(A); see also 39 U.S.C. 3622(d)(1)(D). \6\ 39 U.S.C. 3622(d)(1)(B). \7\ 39 U.S.C. 3622(d)(1)(C). \8\ 39 U.S.C. 3622(d)(1)(E). \9\ 39 U.S.C. 3622(d)(2)(A). \10\ 39 U.S.C. 3622(d)(2)(B). \11\ 39 U.S.C. 3622(d)(2)(C). \12\ 39 U.S.C. 3622(e). --------------------------------------------------------------------------- III. Review Framework To assist commenters, the Commission presents preliminary definitions for the objectives as well as potential methods that may be used to evaluate whether the objectives, taking into account the factors, are being achieved. Proposed definitions and potential evaluation methods for each objective are discussed in section IV. After the Commission receives comments and conducts its analysis, the Commission will determine if the current system is achieving the objectives while taking into account the factors listed in 39 U.S.C. 3622(c). If the Commission finds the system is not achieving these objectives, taking into account the factors, it may propose rules that modify the system or adopt an alternative system to achieve the objectives. IV. Objectives Based on research of legislative history, Commission precedent, stakeholder comments in various past dockets, and other sources, the Commission presents preliminary definitions for each objective. In addition, the Commission suggests measurable key concepts within each objective. These key concepts could be measured quantitatively and/or qualitatively to determine if each objective as a whole has been achieved. Because the statute does not require that factors be independently achieved, the Commission is not proposing definitions or measurement methods for the factors. However, over the course of the review, the factors will be taken into account for each objective, as required by the statute. A. Objective 1: To maximize incentives to reduce costs and increase efficiency.\13\ --------------------------------------------------------------------------- \13\ 39 U.S.C. 3622(b)(1). --------------------------------------------------------------------------- Preliminary definition. A system achieving Objective 1 uses available mechanisms, such as flexibility under the price cap, pricing differentials, and workshare discounts, to the fullest extent possible to incentivize the reduction of costs and increases in operational and pricing efficiency. Potential measurement. There are three measurable key concepts within this objective: (1) Maximize incentives, (2) reduce costs, and (3) increase efficiency. First, ``maximize incentives'' could be measured by determining if the maximum benefit was provided by each incentive mechanism (e.g., price cap, price differentials, and workshare discounts), taking into account associated statutory constraints. For example, a review of whether workshare discounts provided the maximum incentives possible would take into account the constraints set forth in 39 U.S.C. 3622(e). Second, measuring ``reduce costs'' could include an evaluation of the costs, including unit operating costs and controllable costs, before and after the PAEA was implemented. Third, ``increase efficiency'' could include a review of operational and pricing efficiency. Measuring operational efficiency could involve reviewing trend analyses of total factor productivity, real unit operating costs, productivity data, and workhours. To measure pricing efficiency,\14\ a comparison of actual prices and prices that adhere to principles of efficient component pricing could be conducted. --------------------------------------------------------------------------- \14\ Pricing can promote allocative efficiency by setting prices at marginal costs or by applying second-best pricing. Pricing can also promote productive efficiency by application of the Efficient Component Pricing Rule. --------------------------------------------------------------------------- B. Objective 2: To create predictability and stability in rates.\15\ --------------------------------------------------------------------------- \15\ 39 U.S.C. 3622(b)(2). --------------------------------------------------------------------------- Preliminary definition. A system achieving Objective 2 fosters rates, including prices for all market dominant products and promotions, that are capable of being consistently forecast with regard to timing and magnitude and that do not include sudden or extreme fluctuations. Potential measurement. There are two measurable key concepts within this objective: (1) Predictability, and (2) stability. Potential approaches for measuring predictability include measuring the time between notices of market dominant price adjustments, or the amount of time between a notice of market dominant price adjustment and the effective date of those prices. The outcomes of these measurements could be compared to price adjustments prior to the passage of the PAEA, or other relevant benchmarks to measure the predictability of the current system. One potential method for measuring stability is to measure average price increases over time and compare them to objective measures, such as the Consumer Price Index for All Urban Consumers (CPI-U). Another method may be to evaluate the number of price categories that deviate significantly from percentage changes in objective measures, such as the CPI-U or the average price adjustment for the class or product. C. Objective 3: To maintain high quality service standards established under section 3691.\16\ --------------------------------------------------------------------------- \16\ 39 U.S.C. 3622(b)(3). --------------------------------------------------------------------------- Preliminary definition. A system achieving Objective 3 is designed for the Postal Service to consistently achieve, for each class of mail, stated days to delivery at a desired target rate. Potential measurement. The key measurable concept within this objective is ``high quality service standards.'' Potential approaches for the measurement of ``high quality service standards'' include measuring the Postal Service's performance, both for discrete time periods and since the passage of the PAEA. Some of these measurements are already conducted in the Commission's Annual Compliance Determination (ACD) Reports.\17\ For example, the Commission typically details the number of percentage points a class or product is above or below its service performance target.\18\ In addition, measurement of this objective could include analysis of changes in service standards over time, analysis of service performance results over time, and determining how satisfied mail users are with service standards. --------------------------------------------------------------------------- \17\ See, e.g., Docket No. ACR2015, Annual Compliance Determination, March 28, 2016, Chapter 5 (FY 2015 ACD). \18\ See, e.g., FY 2015 ACD at 123. --------------------------------------------------------------------------- D. Objective 4: To allow the Postal Service pricing flexibility.\19\ --------------------------------------------------------------------------- \19\ 39 U.S.C. 3622(b)(4). --------------------------------------------------------------------------- Preliminary definition. A system achieving Objective 4 allows for the Postal Service to exercise its discretion [[Page 95073]] to set prices, the price structure, and the price schedule for market dominant products, subject to other requirements under the law. Potential measurement. The key measurable concept within this objective is ``pricing flexibility.'' Potential measurement methods for this term include comparisons to other systems, such as the pricing flexibility afforded to and/or exercised by foreign posts, utilities, the Postal Service pre-PAEA, and private carriers. Measurement of ``pricing flexibility'' could also include a review of price adjustment proceedings and Annual Compliance Report (ACR) dockets, which highlight the pricing flexibility exercised by the Postal Service. Analysis of the time it takes for the approval of a price adjustment, the number of price categories approved without material alteration, and reviewing discussions of pricing flexibility in other Commission proceedings could also be conducted to determine if this objective is being achieved. E. Objective 5: To assure adequate revenues, including retained earnings, to maintain financial stability.\20\ --------------------------------------------------------------------------- \20\ 39 U.S.C. 3622(b)(5). --------------------------------------------------------------------------- Preliminary definition. In a system achieving Objective 5, the Postal Service is financially solvent while able to respond to changes in its environment (e.g., volume erosion, legal or regulatory framework, demographic trends) and meet its statutory obligations (e.g., pricing and universal service). Potential measurement. The key measurable concept within this objective is ``financial stability,'' which incorporates adequate revenues and retained earnings. ``Financial stability'' could be measured by reviewing short-term, medium-term, and long-term financial stability of the Postal Service. Short-term financial stability could be measured by the Postal Service's operating profit (i.e., operational revenue--operational expenses). Medium-term financial stability could be measured by economic profit (i.e., total revenue - [variable cost + fixed cost]). Long-term financial stability could be measured by solvency (i.e., total assets/total liabilities). The Commission has analyzed these concepts in its recent financial reports and could potentially use those analyses to determine if this objective is being achieved.\21\ For example, in Chapter 4 of its FY 2015 Financial Report, the Commission included an analysis of the Sustainability, Liquidity, Activity, and Financial Solvency of the Postal Service's financial status.\22\ --------------------------------------------------------------------------- \21\ See, e.g., FY 2015 Financial Analysis of United States Postal Service Financial Results and 10-K Statement, March 29, 2016 (FY 2015 Financial Report). \22\ See FY 2015 Financial Report at 75-86. --------------------------------------------------------------------------- F. Objective 6: To reduce the administrative burden and increase the transparency of the ratemaking process.\23\ --------------------------------------------------------------------------- \23\ 39 U.S.C. 3622(b)(6). --------------------------------------------------------------------------- Preliminary definition. A system achieving Objective 6 balances the (sometimes competing) concepts of reducing the costs imposed by rate proceedings or regulatory requirements generated by those proceedings, and the availability of comprehensive understandable material relating to each rate proceeding. Potential measurement. There are two measurable key concepts within this objective: (1) Reduce the administrative burden, and (2) increase the transparency. In order to achieve this objective, the ratemaking system must balance reducing administrative burden with increasing transparency. ``Reducing the administrative burden'' of the ratemaking process could be measured by evaluating the complexity of rate adjustment filings and proceedings and/or quantifying the length, number of information requests and/or staff hours required to review the price adjustment proposal, ACRs, complaints, or dockets related to price setting. ``Increasing transparency'' could be measured in several ways. An analysis of the necessary interaction between stakeholders and the Postal Service and/or Commission could be conducted. Another option could be to analyze the amount and type of information filed under seal compared to publicly available information. These features could also be compared to levels of transparency and administrative burden present prior to the passage of the PAEA. G. Objective 7: To enhance mail security and deter terrorism.\24\ --------------------------------------------------------------------------- \24\ 39 U.S.C. 3622(b)(7). --------------------------------------------------------------------------- Preliminary definition. A system achieving Objective 7 encourages methods of safeguarding the mail system from illegal or dangerous use, or terrorism. Potential measurement. There are two measurable key concepts within this objective: (1) Enhance mail security, and (2) deter terrorism. Possible metrics to determine if Objective 7 is being achieved include a review of available safeguards (and associated available funds) that are intended to enhance security and deter terrorism, and a review of the availability of an exigent-like provision to ensure funds are available to respond to specific threats. H. Objective 8: To establish and maintain a just and reasonable schedule for rates and classifications, however the objective under this paragraph shall not be construed to prohibit the Postal Service from making changes of unequal magnitude within, between, or among classes of mail.\25\ --------------------------------------------------------------------------- \25\ 39 U.S.C. 3622(b)(8). --------------------------------------------------------------------------- Preliminary definition. A system achieving Objective 8 requires that rates and classifications are linked to distinct cost or market characteristics, and the amount charged for each service is neither excessive to the mailer nor threatens the financial integrity of the Postal Service. Potential measurement. There are two measurable key concepts within this objective: (1) Just, and (2) reasonable. These two concepts are associated with both the schedule of rates and the schedule of classifications. To determine whether the schedule of rates and classifications is ``just,'' a review of instances of excessive price increases could be conducted, including a review of classification changes. A review of price and cost relationships could also be conducted to ensure that customers are protected from misuse of the Postal Service's monopoly power. Additionally, a review of the cost or market characteristics that define a price category, product, or service could be conducted. To determine whether the schedule of rates and classifications is ``reasonable,'' an examination of the relationship between price and cost could be conducted to ensure prices and classifications do not threaten the Postal Service's financial integrity. Another option to measure the concept ``reasonable'' could be an examination of the total compensation provided by products/services, classes, and all market dominant classes. I. Objective 9: To allocate the total institutional costs of the Postal Service appropriately between market dominant and competitive products.\26\ --------------------------------------------------------------------------- \26\ 39 U.S.C. 3622(b)(9). --------------------------------------------------------------------------- Preliminary definition. A system achieving Objective 9 has a mechanism to appropriately divide total institutional costs between market dominant and competitive products in a manner reflecting the relevant statutory considerations. Potential measurement. The key measurable concept within this objective is ``allocate the total institutional costs appropriately.'' This objective is related to sections 3633(a)(3) and 3633(b). The measurement of [[Page 95074]] Objective 9 could rely on a historical review of the allocation of institutional costs between market dominant and competitive products. The measurement of this objective could also include a review of any action the Commission takes to analyze the competitive products' minimum contribution to institutional costs. V. Notice of Commission Action Using this framework of potential definitions and measurement methods, the Commission establishes Docket No. RM2017-3 to begin its review of the market dominant ratemaking system. The Commission invites comments from interested persons regarding the process and structure of the review, as well as whether the current system is achieving the objectives, taking into account the factors. In particular, the Commission invites comments in response to the following questions: 1. Is the framework proposed by the Commission appropriate for the review? a. For each objective, is the preliminary definition reasonable? If not, please suggest alternative definitions. b. For each objective, are the potential metrics for measuring the achievement of the objective reasonable? If not, please suggest alternative metrics for measuring whether the objective is being achieved. 2. If the proposed framework is not appropriate for the review, please identify the framework that should be used for the review and describe how to measure the achievement of the objectives in that alternative framework. 3. Based on the Commission's proposed framework or an alternative framework provided in response to question 2, is the current system achieving each objective, while taking into account the factors? Please note that review of the system shall be limited to section 3622 as discussed in section II above. 4. If the system is not achieving the objectives, while taking into account the factors, what modifications to the system should be made, or what alternative system should be adopted, to achieve the objectives? Comments are due no later than March 20, 2017. No reply comments will be accepted. Commission regulations require that comments be filed online according to the process outlined at 39 CFR 3001.9(a). Additional information regarding how to submit comments online can be found at: http://www.prc.gov/how-to-participate. However, given the unique nature of this docket, the Commission will waive these requirements for filers who mail their comments.\27\ All information and comments provided, whether filed through the Commission's filing system or sent by mail, will be made available on the Commission's Web site (http://www.prc.gov). --------------------------------------------------------------------------- \27\ Filers who choose to mail in their comments should be mindful of possible delays given the irradiation process for mail delivered to the Commission. --------------------------------------------------------------------------- Pursuant to 39 U.S.C. 505, the Commission appoints Richard A. Oliver to represent the interests of the general public (Public Representative) in this proceeding. VI. Ordering Paragraphs It is ordered: 1. The Commission establishes Docket No. RM2017-3 to initiate the review of the market dominant ratemaking system as required by 39 U.S.C. 3622. 2. Comments regarding the process and structure of the review, as well as whether the current system is achieving the objectives, while taking into account the factors, and if not, whether and what modifications to the system or an alternative system should be adopted as necessary to achieve the objectives, are due no later than March 20, 2017. 3. Pursuant to 39 U.S.C. 505, Richard A. Oliver is appointed to serve as an officer of the Commission (Public Representative) to represent the interests of the general public in this proceeding. 4. The Secretary shall arrange for publication of this order in the Federal Register. By the Commission. Stacy L. Ruble, Secretary. [FR Doc. 2016-31052 Filed 12-23-16; 8:45 am] BILLING CODE 7710-FW-P
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created 25 years or more before the date ■ 8. Amend § 3004.52 by revising ADDRESSES: Submit comments
on which the records were requested. paragraph (e) and adding paragraph (f) electronically via the Commission’s
* * * * * to read as follows: Filing Online system at http://
■ 5. Amend § 3004.13 by revising www.prc.gov. Those who cannot submit
§ 3004.52 Fees—general provisions. comments electronically should contact
paragraph (a) to read as follows:
* * * * * the person identified in the FOR FURTHER
§ 3004.13 Notice and publication of public (e) No requester will be charged a fee INFORMATION CONTACT section by
information. after any search or response which telephone for advice on filing
(a) Decisions, advisory opinions, occurs after the applicable time limits as alternatives.
orders, public reports, and frequently described in §§ 3004.43 and 3004.44,
FOR FURTHER INFORMATION CONTACT:
requested agency records will be made unless:
David A. Trissell, General Counsel, at
available to the public by posting on the (1) The Commission extends the time
202–789–6820.
Commission’s Web site at http:// limit for its response due to unusual
circumstances, pursuant to § 3004.45(a), SUPPLEMENTARY INFORMATION:
www.prc.gov.
and the Commission completes its Table of Contents
* * * * *
response within the extension of time
■ 6. Amend § 3004.43 by revising I. Introduction
provided under that section; or II. Scope of the Review
paragraph (a) and adding paragraph (2) The Commission extends the time
(d)(4) to read as follows: III. Review Framework
limit for its response due to unusual IV. Objectives
§ 3004.43 Response to requests. circumstances, pursuant to § 3004.45(a), V. Notice of Commission Action
and more than 5,000 pages are necessary VI. Ordering Paragraphs
(a) Within 20 days (excluding
to respond to the request and the
Saturdays, Sundays and legal holidays) I. Introduction
Commission has discussed with the
after receipt of a request for a On December 20, 2006, the Postal
requester how they could effectively
Commission record, the Secretary or Accountability and Enhancement Act
limit the scope of the request or made
Assistant Secretary will notify the (PAEA) was signed into law.1 The PAEA
at least three good faith attempts to do
requester of its determination to grant or required that the Commission establish
so; or
deny the request and the right to seek a modern system of regulating rates and
(3) A court has determined that
assistance from the Commission’s FOIA classes for market dominant products.2
exceptional circumstances exist and
Public Liaison. The PAEA also mandated that the
excused the Commission from
* * * * * responding by court order. Commission review this system 10 years
(d) * * * (f) The Commission may, however, later to determine if it is achieving the
(4) The right to seek dispute charge fees for a partial grant of a objectives, taking into account the
resolution services from the request while it reviews records that factors, established by Congress.3 If the
Commission’s FOIA Public Liaison or may be exempt and may be responsive Commission determines that the system
the Office of Government Information to the request, if it is made within the is not achieving the objectives, taking
Services. applicable time limits. into account the factors, the
* * * * * [FR Doc. 2016–30905 Filed 12–23–16; 8:45 am] Commission may, by regulation, make
■ 7. Revise § 3004.45 to read as follows: BILLING CODE 7710–FW–P
modifications or adopt an alternative
system as necessary to achieve the
§ 3004.45 Extension of response time limit. objectives. Id.
(a) The Commission may extend the POSTAL REGULATORY COMMISSION In accordance with 39 U.S.C. 3622,
time limit for a response to a request or this Notice and Order establishes the
appeal for up to 10 business days due 39 CFR Part 3622 beginning of the Commission’s statutory
to unusual circumstances, as specified review of the ratemaking system. Based
in 5 U.S.C. 552(a)(6)(B)(iii). In such a [Docket No. RM2017–3; Order No. 3673] on the Commission’s analysis and
case, the Commission will notify the relevant information obtained through
requester in writing of the unusual Statutory Review of the System for this proceeding, the Commission will
circumstance causing the extension and Regulating Market Dominant Rates and determine if the objectives, taking into
the date by which the Commission Classifications account the factors, are being achieved
estimates that the request can be by the current system. If the
AGENCY: Postal Regulatory Commission.
processed. Commission finds that the objectives,
ACTION:Advance notice of proposed taking into account the factors, are not
(b) If an extension will exceed 10 rulemaking.
business days, the Commission will: being achieved, the Commission may
SUMMARY: The Commission is initiating propose modifications to the system or
(1) Provide the requester with an
a review to determine whether the propose to adopt an alternative system
opportunity to limit the scope of the
current system of regulating rates and as necessary to achieve the objectives.
request or to arrange an alternative
timeframe for processing the request or classes for market dominant products is II. Scope of the Review 4
a modified request. The applicable time achieving the objectives, taking into The Commission intends to examine
limits are not tolled while the account the factors, established by all aspects of the ratemaking system
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Commission waits for a response from Congress under the Postal
the requester under this subsection; and Accountability and Enhancement Act of 1 Pub. L. 109–435, 120 Stat. 3198 (2006).
(2) Make its FOIA Public Liaison 2006. This advance notice informs the 2 39 U.S.C. 3622(a).
available to the requester and apprise public of the docket’s initiation, invites 3 39 U.S.C. 3622(d)(3).
the requester of their right to seek public comment, and takes other 4 The Postal Service previously petitioned the
administrative steps. Commission to initiate a proceeding to clarify the
dispute resolution services from the scope of the statutory review. See Docket No.
Office of Government Information DATES: Comments are due: March 20, RM2016–9, Petition of the United States Postal
Services. 2017. Continued
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to set prices, the price structure, and the Commission included an analysis of the like provision to ensure funds are
price schedule for market dominant Sustainability, Liquidity, Activity, and available to respond to specific threats.
products, subject to other requirements Financial Solvency of the Postal H. Objective 8: To establish and
under the law. Service’s financial status.22 maintain a just and reasonable schedule
Potential measurement. The key F. Objective 6: To reduce the for rates and classifications, however
measurable concept within this administrative burden and increase the the objective under this paragraph shall
objective is ‘‘pricing flexibility.’’ transparency of the ratemaking not be construed to prohibit the Postal
Potential measurement methods for process.23 Service from making changes of unequal
this term include comparisons to other Preliminary definition. A system magnitude within, between, or among
systems, such as the pricing flexibility achieving Objective 6 balances the classes of mail.25
afforded to and/or exercised by foreign (sometimes competing) concepts of Preliminary definition. A system
posts, utilities, the Postal Service pre- reducing the costs imposed by rate achieving Objective 8 requires that rates
PAEA, and private carriers. proceedings or regulatory requirements and classifications are linked to distinct
Measurement of ‘‘pricing flexibility’’ generated by those proceedings, and the cost or market characteristics, and the
could also include a review of price availability of comprehensive amount charged for each service is
adjustment proceedings and Annual understandable material relating to each neither excessive to the mailer nor
Compliance Report (ACR) dockets, rate proceeding. threatens the financial integrity of the
which highlight the pricing flexibility Potential measurement. There are two Postal Service.
exercised by the Postal Service. measurable key concepts within this Potential measurement. There are two
Analysis of the time it takes for the objective: (1) Reduce the administrative measurable key concepts within this
approval of a price adjustment, the burden, and (2) increase the objective: (1) Just, and (2) reasonable.
number of price categories approved transparency. In order to achieve this These two concepts are associated with
without material alteration, and objective, the ratemaking system must both the schedule of rates and the
reviewing discussions of pricing balance reducing administrative burden schedule of classifications.
flexibility in other Commission with increasing transparency. To determine whether the schedule of
proceedings could also be conducted to ‘‘Reducing the administrative burden’’ rates and classifications is ‘‘just,’’ a
determine if this objective is being of the ratemaking process could be review of instances of excessive price
achieved. measured by evaluating the complexity increases could be conducted, including
E. Objective 5: To assure adequate of rate adjustment filings and a review of classification changes. A
revenues, including retained earnings, proceedings and/or quantifying the review of price and cost relationships
to maintain financial stability.20 length, number of information requests could also be conducted to ensure that
Preliminary definition. In a system and/or staff hours required to review the customers are protected from misuse of
achieving Objective 5, the Postal Service price adjustment proposal, ACRs, the Postal Service’s monopoly power.
is financially solvent while able to complaints, or dockets related to price Additionally, a review of the cost or
respond to changes in its environment setting. market characteristics that define a price
(e.g., volume erosion, legal or regulatory ‘‘Increasing transparency’’ could be category, product, or service could be
framework, demographic trends) and measured in several ways. An analysis conducted.
meet its statutory obligations (e.g., of the necessary interaction between To determine whether the schedule of
pricing and universal service). stakeholders and the Postal Service and/ rates and classifications is ‘‘reasonable,’’
Potential measurement. The key or Commission could be conducted. an examination of the relationship
measurable concept within this Another option could be to analyze the between price and cost could be
objective is ‘‘financial stability,’’ which amount and type of information filed conducted to ensure prices and
incorporates adequate revenues and under seal compared to publicly classifications do not threaten the Postal
retained earnings. available information. These features Service’s financial integrity. Another
‘‘Financial stability’’ could be option to measure the concept
could also be compared to levels of
measured by reviewing short-term,
transparency and administrative burden ‘‘reasonable’’ could be an examination
medium-term, and long-term financial
present prior to the passage of the of the total compensation provided by
stability of the Postal Service. Short-
PAEA. products/services, classes, and all
term financial stability could be
G. Objective 7: To enhance mail market dominant classes.
measured by the Postal Service’s I. Objective 9: To allocate the total
security and deter terrorism.24
operating profit (i.e., operational Preliminary definition. A system institutional costs of the Postal Service
revenue—operational expenses). achieving Objective 7 encourages appropriately between market dominant
Medium-term financial stability could and competitive products.26
methods of safeguarding the mail
be measured by economic profit (i.e., Preliminary definition. A system
system from illegal or dangerous use, or
total revenue ¥ [variable cost + fixed achieving Objective 9 has a mechanism
terrorism.
cost]). Long-term financial stability Potential measurement. There are two to appropriately divide total
could be measured by solvency (i.e., measurable key concepts within this institutional costs between market
total assets/total liabilities). objective: (1) Enhance mail security, and dominant and competitive products in a
The Commission has analyzed these
(2) deter terrorism. Possible metrics to manner reflecting the relevant statutory
concepts in its recent financial reports
determine if Objective 7 is being considerations.
and could potentially use those analyses Potential measurement. The key
mstockstill on DSK3G9T082PROD with PROPOSALS
achieved include a review of available
to determine if this objective is being measurable concept within this
safeguards (and associated available
achieved.21 For example, in Chapter 4 of objective is ‘‘allocate the total
funds) that are intended to enhance
its FY 2015 Financial Report, the institutional costs appropriately.’’ This
security and deter terrorism, and a
20 39
review of the availability of an exigent- objective is related to sections 3633(a)(3)
U.S.C. 3622(b)(5).
21 See,e.g., FY 2015 Financial Analysis of United
and 3633(b). The measurement of
22 See FY 2015 Financial Report at 75–86.
States Postal Service Financial Results and 10–K
23 39 U.S.C. 3622(b)(6). 25 39 U.S.C. 3622(b)(8).
Statement, March 29, 2016 (FY 2015 Financial
Report). 24 39 U.S.C. 3622(b)(7). 26 39 U.S.C. 3622(b)(9).
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Objective 9 could rely on a historical their comments.27 All information and revision to the Mendocino County Air
review of the allocation of institutional comments provided, whether filed Quality Management District
costs between market dominant and through the Commission’s filing system (‘‘MCAQMD’’ or ‘‘the District’’) portion
competitive products. The measurement or sent by mail, will be made available of the applicable state implementation
of this objective could also include a on the Commission’s Web site (http:// plan (SIP) for the State of California
review of any action the Commission www.prc.gov). pursuant to requirements under the
takes to analyze the competitive Pursuant to 39 U.S.C. 505, the Clean Air Act (CAA or Act). We are
products’ minimum contribution to Commission appoints Richard A. Oliver proposing a limited approval and
institutional costs. to represent the interests of the general limited disapproval of one rule and we
public (Public Representative) in this are proposing to approve the remaining
V. Notice of Commission Action
proceeding. three permitting rules. The submitted
Using this framework of potential revisions include amended rules
definitions and measurement methods, VI. Ordering Paragraphs
governing the issuance of permits for
the Commission establishes Docket No. It is ordered: stationary sources, including review and
RM2017–3 to begin its review of the 1. The Commission establishes Docket permitting of minor sources, and major
market dominant ratemaking system. No. RM2017–3 to initiate the review of sources and major modifications under
The Commission invites comments from the market dominant ratemaking system part C of title I of the Act. The intended
interested persons regarding the process as required by 39 U.S.C. 3622. effect of these proposed actions is to
and structure of the review, as well as 2. Comments regarding the process update the applicable SIP with current
whether the current system is achieving and structure of the review, as well as MCAQMD permitting rules and to set
the objectives, taking into account the whether the current system is achieving the stage for remedying certain
factors. In particular, the Commission the objectives, while taking into account deficiencies in these rules. If finalized
invites comments in response to the the factors, and if not, whether and what as proposed, the limited disapproval
following questions: modifications to the system or an actions would trigger an obligation for
1. Is the framework proposed by the alternative system should be adopted as EPA to promulgate a Federal
Commission appropriate for the review? necessary to achieve the objectives, are
a. For each objective, is the Implementation Plan (FIP) for the
due no later than March 20, 2017. specific New Source Review (NSR)
preliminary definition reasonable? If 3. Pursuant to 39 U.S.C. 505, Richard
not, please suggest alternative program deficiencies unless California
A. Oliver is appointed to serve as an submits and we approve SIP revisions
definitions. officer of the Commission (Public
b. For each objective, are the potential that correct the deficiencies within two
Representative) to represent the years of the final action.
metrics for measuring the achievement interests of the general public in this
of the objective reasonable? If not, proceeding. DATES: Any comments must arrive by
please suggest alternative metrics for 4. The Secretary shall arrange for January 26, 2017.
measuring whether the objective is publication of this order in the Federal
being achieved. ADDRESSES: Submit your comments,
Register.
2. If the proposed framework is not identified by Docket ID Number EPA–
By the Commission. R09–OAR–2016–0726 at http://
appropriate for the review, please
identify the framework that should be Stacy L. Ruble, www.regulations.gov, or via email to
used for the review and describe how to Secretary. r9airpermits@epa.gov. For comments
measure the achievement of the [FR Doc. 2016–31052 Filed 12–23–16; 8:45 am] submitted at Regulations.gov, follow the
objectives in that alternative framework. BILLING CODE 7710–FW–P online instructions for submitting
3. Based on the Commission’s comments. Once submitted, comments
proposed framework or an alternative cannot be edited or removed from
framework provided in response to ENVIRONMENTAL PROTECTION Regulations.gov. For either manner of
question 2, is the current system AGENCY submission, the EPA may publish any
achieving each objective, while taking comment received to its public docket.
into account the factors? Please note 40 CFR Part 52 Do not submit electronically any
that review of the system shall be information you consider to be
[EPA–R09–OAR–2016–0726; FRL–9957–12–
limited to section 3622 as discussed in Region 9]
Confidential Business Information (CBI)
section II above. or other information whose disclosure is
4. If the system is not achieving the Approval and Limited Approval and restricted by statute. Multimedia
objectives, while taking into account the Limited Disapproval of Air Quality submissions (audio, video, etc.) must be
factors, what modifications to the Implementation Plans; California; accompanied by a written comment.
system should be made, or what Mendocino County Air Quality The written comment is considered the
alternative system should be adopted, to Management District; Stationary official comment and should include
achieve the objectives? Source Permits discussion of all points you wish to
Comments are due no later than make. The EPA will generally not
March 20, 2017. No reply comments AGENCY: Environmental Protection consider comments or comment
will be accepted. Commission Agency (EPA). contents located outside of the primary
regulations require that comments be ACTION: Proposed rule. submission (i.e. on the web, cloud, or
mstockstill on DSK3G9T082PROD with PROPOSALS
filed online according to the process other file sharing system). For
outlined at 39 CFR 3001.9(a). Additional SUMMARY: The Environmental Protection additional submission methods, please
information regarding how to submit Agency (EPA) is proposing action on contact the person identified in the FOR
comments online can be found at: four permitting rules submitted as a FURTHER INFORMATION CONTACT section.
http://www.prc.gov/how-to-participate. 27 Filers who choose to mail in their comments
For the full EPA public comment policy,
However, given the unique nature of should be mindful of possible delays given the
information about CBI or multimedia
this docket, the Commission will waive irradiation process for mail delivered to the submissions, and general guidance on
these requirements for filers who mail Commission. making effective comments, please visit
VerDate Sep<11>2014 20:09 Dec 23, 2016 Jkt 241001 PO 00000 Frm 00009 Fmt 4702 Sfmt 4702 E:\FR\FM\27DEP1.SGM 27DEP1](https://thefederalregister.org/doc/81_FR_95319/page/4.svg)
Document Created: 2018-02-14 09:13:39
Document Modified: 2018-02-14 09:13:39
| Category | Regulatory Information | |
| Collection | Federal Register | |
| sudoc Class | AE 2.7: GS 4.107: AE 2.106: | |
| Publisher | Office of the Federal Register, National Archives and Records Administration | |
| Section | Proposed Rules | |
| Action | Advance notice of proposed rulemaking. | |
| Dates | Comments are due: March 20, 2017. | |
| Contact | David A. Trissell, General Counsel, at 202-789-6820. | |
| FR Citation | 81 FR 95071 |
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