Docket No. R2005-1–1 –
PRESIDING OFFICER’S
RULING NO. R2005-1/54
UNITED STATES OF AMERICA
POSTAL RATE COMMISSION
WASHINGTON, DC20268-0001
Postal Rate and Fee Changes Docket No. R2005-1
PRESIDING OFFICER’S RULING DENYING
MAJOR MAILERS ASSOCIATION
MOTION TO COMPEL
(Issued July 19, 2005)
Library Reference USPS-LR-K-101 contains the Postal Service’s calculation of delivery costs by rate category for First-Class and Standard Mail. LR-K-101 is calculated by the Postal Service applyingestablished methods in compliance with the requirements of Rule 53. These are base year estimates calculated by the methodsthe Commission most recently used to determine avoided costs for purposes of designing worksharing discounts.
Major Mailers Association (MMA), MMA/USPS-T16-26, seeks to compel the Postal Service to take LR-K-101 and recalculate unit delivery costs for nonpresorted First-Class Mail by separating unit collection costs from remaining costs. The purpose of its request is to estimate the delivery costs of a proposed new benchmark from which to calculate First-Class Mail worksharing discounts. Major Mailers Association’s Motion to Compel Response to Interrogatory MMA/USPS-T16-26, filed July 7, 2005 (Motion).
MMA has already requested that the Postal Service separate unit collection costs from remaining costs applying the Postal Service’s new estimating methods. See MMA/USPS-T16-13. The Postal Service complied with this request in LR-K-145. MMA argues that it would be unduly difficult, if not impossible, for it to attempt to separate out collection costs under established methods, but that it would be a minor burden for the Postal Service, since the Postal Service created LR-K-101 and is thoroughly familiar with it. Motion at 3.
The Postal Service objects to MMA’s request that it separate rate category delivery costs into collection costs and other costs again, applying Commission methods. Objection of the United States Postal Service to MMA Interrogatory to Witness Kelley (MMA/USPS-T16-26), filed June 23, 2005. It argues that it has a narrower duty to respond to discovery requests with respect to materials that the Commission requires under Rule 53. Response of the United States Postal Service in Opposition to MMA Motion to Compel a Response to MMA Interrogatory to Witness Kelley (MMA/USPS-T16-26), filed July 14, 2005 at 2-3 (Response). It rejects MMA’s assertion that MMA cannot separate collection costs from remaining costs in LR-K-101, arguing that witness Schenk has already shown how this could be done in Docket No. R2001-1. It adds that MMA has made no showing that it has made any attempt to perform the requested task itself. Response at 4-5.
I will not require the Postal Service to recalculate the delivery costs estimated according to Commission-approved methods in LR-K-101. My conclusion rests, in part, on the narrower duty that the Postal Service has to respond to discovery concerning submissions that are prepared to satisfy Rule 53. Such materials are not sponsored by the Postal Service as an advocate of their merits. The purpose of requiring the Postal Service to estimate costs under established methods is to allow participants to track the impact of the Postal Service’s proposed changes in cost methods. The Postal Service has an obligation to document such materials sufficiently to allow others to understand how the estimates were made, and how, with reasonable effort, those estimates could be modified if relevant assumptions were changed.
Preliminarily, it appears that the Postal Service has met that obligation, by documenting LR-K-101, and by having witness Schenk explain in detail in Docket No. R2001-1 how collection costs could be separately identified using established methods. See Response of United States Postal Service Witness Schenk to [MMA/USPS-T43-18(a)], filed December 6, 2001. Under these circumstances, MMA has an obligation to show that it has tried to apply the instructions provided in the above-referenced interrogatory to separate out collection costsusing established methods. The Postal Service has a duty to explain to MMA, in response to traditional discovery, or through a technical conference, how to apply the Schenk approach in this docket, if any modification is needed.
RULING
The Major Mailers Association’s Motion to Compel Response to Interrogatory MMA/USPS-T16-26, filed July 7, 2005, is denied.
George Omas
Presiding Officer