DOCKET SECTION
BEFORE THE
POSTAL RATE COMMISSION
WASHINGTON, D.C. 20266-9001
POSTAL RATE AND FEE CHANGES,
1997
RECEIVE[!
SEP&/
‘-/ 45 f/l ‘97
PGSi.‘~ii:,:;: ~!:,(/
OFFICE
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Docket No. R97-1
I
i
RESPONSE OF UNITED STATES POSTAL SERVICE WITNESS F’ATELUNAS TO
INTERROGATORIES
OF THE OFFICE OF THE CONSUMER ADVOCATE
(OCA/USPS-T15-14-16)
The United States Postal Service hereby provides the responses of witness
Patelunas to the following interrogatories
OCAIUSPS-T15-14-16,
Each interrogatory
filed on September
of the Office of the Consumer Advocate:
10, 1997.
is stated verbatim and is followed by the response.
Respectfully
submitted,
UNITED STATES POSTAL SERVICE
By its attorneys:
Daniel J. Foucheaux, Jr.
Chief Counsel, Ratemaking
Susan M. Duchek
475 L’Enfant Plaza West, SW.
Washington, D.C. 20260-l 137
(202) 268-2990; Fax -5402
September 24, 1997
Response of United States Postal Service Witness Patelunas
to Interrogatories of
Office of the Consumer Advocate
OCANSPS-Tl5-14.
Please refer to your response to OCAIUSPS-T2460b,
redirected
to you by Witness Lion. Witness Lion estimates a decrease of 4.99 percent
(14,839,920 I 15,620,769 - 1) in the number of post office boxes during the test year.
Please identify, and provide citations for, all “components that are used to build
a.
the distribution keys for the PESSA costs” that are affected by the decrease in the
number of post office boxes during the test year.
Please confirm that, if witness Lion had estimated a 4.99% increase in post
b.
office boxes during the test year, only the components identified in part a. above would
be affected.
i.
If you do not confirm, please explain, identify the components affected,
and show the change in attributable post office box costs in the TYAR Include
citations for all figures used.
ii.
If you confirm, please explain whether the distribution
Please provide the percentage
above that occur from
C.
changes for the components
keys would change.
identified in part a.
i.
the Base Year 1996 to Test Year Before Rates 1998, and
ii.
the Test Year Before Rates 1998 to Test Year After Rates 1998.
Please show the changes in attributable post office box costs from the TYBR to
d.
the TYAR as a result of the 4.99% decrease in the number of post office boxes durjng
the test year. Please show the development of TYAR attributable post office box costs
using the components and distribution keys identified in part a. above.
OCNUSPS-T15-14
a.
Response:
Pages 2 and 3 of Attachment
components
I that accompanies
this response show the PESSA
affected by the change in the number of post office boxes in the test year.
The first column is the component number, the second wlumn
the third column is the distribution
explanation concerning
is the component
title,
key and the fourth column is the source of the
the treatment in the model. The PESSA components
treated the same in both the base year and rollforward
.
are
portions of the Postal Service’s
Response of United States Postal Service Witness Patelunas
to Interrogatories of
Office of the Consumer Advocate
OCANSPS-T15-14
Response continued:
cost model. Additionally,
these components
for each year in the cost model, the developrnent
can be found in the following workpapers:
Base Year 1996
FY 1997 Before Volume and Workyear Mix Adjustments
FY 1997 After Volume Mix and Before Workyear Mix
FY 1997 Volume and Workyear Mix Adjusted
TY 1998BR Before Workyear Mix Adjustment
TY 1998BR After Workyear Mix Adjustment
TY 1998AR Before Workyear Mix Adjustment
TY 1998AR After Workyear Mix Adjustment
b.
and use of
WP A-3 end WP A-4
WP-A, Tables B and
WP-B, Tables B and
WP-C, Tables B and
WP-0, Tables B and
WP-E, Tables B and
WP-F, Tables B and
WP-G, Tables B and
C
C
C
C
C
C
C
Part b is not confirmed
i.
In addition to the PESSA components
on page 1 of Attachment
cited above, the components
listed
I to this response change as a result of the change in the
number of post office boxes. Page 1 of Attachment
I shows the components
that
receive a mail volume effect in the rollforward model. Column 1 is the component
number, wlumn
2 is the component title, column 3 is the treatment
the rollforward and wlumn
found.
Particularly,
in the file VBL2 in
4 is the sources in which the VBl2 for eacln year can be
Section 2 is Fiscal Year 1997, Section 5 is Test Year 1998 Before
Rates and Section 7 is Test Year 1998 After Rates. The change in volume variable
costs of post office boxes resulting from the mail volume effect can be seen on a
component by component basis in the following workpapers:
FY 1997 Before Volume and Workyear Mix Adjustments
TY 1998BR Before Workyear Mix Adjustment
TY 1998AR Before Workyear Mix Adjustment
WP-A, Table A, Table 3.
WP-D, Table A, Table 3.
WP-F, Table A, Table 3.
The change in volume variable costs of post office boxes resulting from the PESSA
treatment can be seen on a component by component
part a. of this response.
basis in the workpapers
listed in
Response of United States Postal Service Witness Patelunas
to Interrogatories of
Office of the Consumer Advocate
OCANSPS-T15-14
C.
Response continued:
ii.
Not applicable.
i.
Any percentage
changes for the components
identified in part a. that
occur from the Base Year 1996 to the Test Year Before Rates 1998 and the Test Year
After Rates 1998 can be calculated using the sources provided in my responses to
parts a and b and the sources provided to Attachment
ii.
I to OCNUSPS-T15-14.
Part ii. is confusing because there is no change from Test Year 1998
Before Rates to Test Year 1998 Afler Rates. The changes are from Fiscal Year 1997
to Test Year 1998 Before Rates and from Fiscal Year 1997 to Test Year 1998 After
Rates. As stated in my response to part I., any of these calculations
by referring to the sources cited.
d.
See my response to part c.
.
can be performed
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Response of United States Postal Service Witness Patelunas
to Interrogatories of
Office of the Consumer Advocate
OCNUSPS-T15-15.
Please refer to your response to OCANSPS-T2460b,
to you by Witness Lion.
redirected
Please confirm that the ‘BY96” post office box percentages in components 1099
TTotal Key of Space Components) and 1199 (Total Key of Rental Value Components)
are computed as follows.
i.
1oo,ooo,ooo
Component
ii.
Component
9,669,160 I100,000,000
1099 (Total Key of Space Components):
8.89% = 8,886,754 I
1199 (Total Key of Rental Value Components):
9.67% =
Please confirm that the ‘TYAR” post office box percentages in components 1099
FTotal Key of Space Components) and 1199 (Total Key of Rental Value Components)
are computed as follows.
Component
i.
1 ,oo,ooo.ooo
1099 (Total Key of Space Components):
ii.
Component
9,568,770 I100,000,000
1199 (Total Key of Rental Value Components):
kotal
b.
C.
9.57% =
Please provide the ‘TY98BR” post office box percentages for components 1099
Key of Space Components) and 1199 (Total Key of Rental Value Components).
OCANSPS-T15-15
a.
8.81% = 8,814,255 I
Response:
i.
Subpart i. is confirmed.
ii.
Subpart ii. is confirmed.
i.
Subpart i. is confirmed.
ii.
Subpart ii. is confirmed
Using the same calculation
method employed in parts a and b, please refer to
the amounts shown on pages 46 (Component
1099) and 66 (Component
workpaper WP-E, Table B.
.
1199) of my
Response of United States Postal Service Witness Patelunas
to Interrogatories of
Office of the Consumer Advocate
OCAIUSPS-Tl5-16.
Docket No. MC96-3.
Please refer to Appendix B of your testimony (USPS-T-5)
In Appendix 8, page 1, lines 4-7, you state
in
The presentation is based on the assumption that a percentage decrease in the
number of Post Office Boxes in use will be followed by [the] same percentage of
mail delivered on the street, either by city delivery carriers or rural carriers.
a.
Please confirm that you made the same assumption in your testimony in Docket
No. R97-1, that “a percentage decrease in the number of Post Office Boxes in use will
be followed by [the] same percentage of mail delivered on the street.” If you do not
confirm, please explain. If you do confirm, please provide a citation to the document
that implements the assumption.
If the assumption stated in the quote above is no longer applicable to post office
b.
boxes in Docket No. R97-1, please explain what has changed in this docket to make
the assumption no longer applicable.
OCAIUSPS-T15-16
a and b.
Response:
Pan a. is not confirmed.
Nothing has changed in this docket to make the
assumption no longer applicable.
To see the impact of employing my Docket No.
MC96-3 Appendix B methodology,
see USPS Library Reference
H-274, Cost
Adjustments for Changes Due to Proposed Rates Impact on Post Office Boxes
Provided in Response to OCAIUSPS-T15-9c.
,
DECLARATION
I, Richard Patelunas, declare under penalty of perjury that the foregoing answers to
interrogatories are true and correct to the best of my knowledge, information, and
belief.
-2CERTIFICATE
OF SERVICE
I hereby certify that I have this day served the foregoing dOCment upon all
participants of record in this proceeding in accordance with section 12 of ttie Rules of
Practice.
PLh,Nw4
Susan M. Duchek
475 L’Enfant Plaza West, S.W.
Washington, D.C. 20260-l 137
(202) 268-2990; Fax -5402
September 24, 1997