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KECEIVE!!
BEFORE THE
POSTAL PATE COMMISSION
20268-0001
WASHINGTON, D.C.
I3
h
2 42 P/j ‘96
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GFFIC! 9~ it,: ~~~~~~~~~~~
Special
Services
Docket No. MC96-3
Fees and Classifications
REVISED ANSWEROF THE OFFICE OF THE CONSUMERADVOCATE
TO INTERROGATORYUSPS/OCA-T400-21
OF THE UNITED STATES POSTAL SERVICE
REDIRECTED TO WITNESS THOMPSON
(NOVEMBER13, 1996)
The Office
of the Consumer Advocate
hereby
answer of Pamela A. Thompson to interrogatory
filed/on
November 4, 1996, redirected
Collins.
An error
in OCA-LR-6 necessitates
used for
Insurance
from a list
Commission's
percentage
Priority
from "28.3"
of special
services
The revised
response
Respectfully
from witness
changing,
to "28.4"
with
Docket No. R94-1 recommendations
points.
the revised
USPS/OCA-T400-ill,
initially
percentage
submits
the
and deleti.ng
a vari,snce
of more than
from the
10
is attached.
submitted,
EMMETTRAND COSTICH
Assistant
Director
Office of the Consumer Advocate
ANSWEROF OCA WITNESS PAMELA A. THOMPSON
TO REDIRECTED INTERROGATORYUSPS/OCA-T400-21
USPS/OCA-T400-21.
8 and 9 of your testimony
On page 3, lines
you state "I oppose this attempt to raise revenues cmutside an
omnibus rate case".
a.
Is it your testimony
that rates and revenue can never be
increased
except in an omnibus rate case?
If your answer to
(a) is affirmative,
please identify
all legal authority
of
which you are aware that supports
your conclusion.
b.
If your answer to (a) is negative,
please explain
the
circumstances
under which you feel rates and revenues can be
increased
and how you reached this conclusion.
A.
a.
No.
b.
I am not
situations
in a position
in which
However,
the
decision
must b'e rational.
to generate
The predecisional
inequitable,
particular
category
increase,
revenue
burden,
designed
purpose
of a rate
rate
increase
is
to generate
categories
new net
in which
revenue
a selective
can be demonstrated
has caused
a new revenue
attributable
costs),
solely
case
case is
of certain
a situation
below
rate
and discriminatory.
When it
of mail
fall
a general
designed
be rational.
when rates
(e.g.,
rate
would
are jus;tifiable.
an omnibus
arbitrary,
possible
outside
exclusion
increase
I can hypothesize
increalse
rates
then
revenue,
all
increases
When the primary
from a rate
is unfair,
rate
to raise
new net
appropriate.
of mail
selective
to catalog
to recover
may be appropriate.
that
it
a
burden
then
a targeted
the new demonstrated
However,
rate
should
be
Revised
11/13/96
ANSWEROF OCA WITNESS PAMELA A. THOMPSON
TO REDIRECTED INTERROGATORYUSPS/OCA-T400-21
CONTINUATION OF ANSWER TO USPS/OCA-T400-21:
possible
to make even this
any given
cost
year
coverage
recent
there
is
too high
designed
necessary
rate
relative
neutral.
of mail
to the Commissions
to neutralize
discussion
could
the net
was 156.8
BY 95) total
mail
Comparing
individual
indicates
that
refers
revenue
In
whose
most
receive
rate
eflfect
percent.
coverage
projected
cost
coverages
consider
all
points.
The following
of any
coverage
variances
cost
Certified
by 26.5,
19.1,
Stamped Envelopes
for
while
coverages
exceed
Priority
Bound Printed
by 12.2,
-
mail
MC96-3,
was 157 percent.
with
actuals
other-s
than
are below,
For example,
10 percentage
Docket
No. R94-1
10 percentage
by 28.4,
The
total
FY 95 (i.e.,
greater
by more than
by 31.2,
27.9,
are above,
page 4.
No. R94-1 recommendations.
recommendations
Rate Fourth
The actual
cost
Docket
cost
coverage
and services
some coverages
the Commission's
to OCA-LR-6,
R94-1 TYAR) cost
and services
Special
to be categories
Such categories
FY 95 (i.e.,
Commission
revenue
increases.
The following
projeclted
of case net
are likely
recommendation.
reductions
type
points:
Mone!y Orders
Matter
by 25.6,
and Registry
by 11.8.
by
Cards by
Revised
11/13/96
ANSWEROF OCA WITNESS PAMELA A. THOMPSON
TO REDIRECTED INTERROGATORYUSPS/OCA-T400-21
CONTINUATION OF ANSWER TO USPS/OCA-T400-21:
Bringing
Docket
rate
these
cost
"in
line"
No. R94-1 recommendations
decrease.
Commission's
percentage
Classroom
The following
Docket
Single
by 24.6,
these
Docket
No. R94-1
cost
Piece
Special
the Conmission's
require
each to have a
coverages
cost
Third
Delivery
COD by 13.9,
Bringing
could
with
are below
No. R94-1 recommendations
points:
Rate by 17.0,
rate
coverages
by more than
by 44.5,
by 17.5,
"in
line"
recommendations
could
Service
with
10
Second-Class
Fourth-Class
and P.O. Box/Caller
coverages
the
L,ibrary
by 10.3.
the Commission's
require
each to have a
increase.
The Postal
special
service
Service
offerings.
have been net
revenue
tiout
of line"
with
cost
coverages,
more "in
Delivery,
Service
line."
proposes
Conceivably,
neutral.
Several
the Commission's
and rates
could
For example:
Money Orders
reform
Docket
Docket
service
No. 94-1
have been adjusted
service.
select
rates
to bring
However,
are
recommended
Registry,
and COD and targeted
for
No. MC96-3 could
special
Money Orders,
COD and P.O. Box/Caller
ignored
classification
them
Special
the
Certified.
Postal
Revised
11/6/96
ANSWEROF OCA WITNESS PAMELA A. THOMPSON
TO REDIRECTED INTERROGATORYUSPS/OCA-T400-21
CONTINUATION OF ANSWER TO USPS/OCA-T400-21:
In R94-1,
services
for
million.
projected
costs
revenues
attributable
FY 95 were $1,366.7
See Appendix
attributable
total
for
were $1,563.8
million;
G, Schedule
special
FY 95 were thus
$6.2 million
less
actual
were $21.1
million
Clearly,
service
if
Actual
1.
actual
special
service
rates
back "in
in net
revenues
would
be needed.
line"
special
were $1,542.8
total
FY 95
million;
Base Year
attributable
than
(FY
costs
R94-1 projections,
in excess
the purpose
for
were $1,360.5
PRC-LR-2,
million.
Special
projec:tions.
revenues
services
and USPS-T-SC.
revenues
costs
1995),
for
while
of the Commission's
of MC96-3 were to bring
with
R94-1,
then
no increase
DECLARATION
I,
Pamela A. Thompson, declare
the answers
United
States
knowledge,
Executed
to redirected
Postal
information
interrogatory
Service
is true
and belief.
/ 996
under penalty
of perjury
that
USPS/OCA-T400--21 of the
and correct,
to the best
of my
CERTIFICATE OF SERVICE
I hereby
certify
document upon all
accord,ance
with
that
I have this
participants
section
3.B(3)
of record
date
served
in this
of the special
proceeding
rules
EMMETTRAND COSTICH
Attorney
Washington,
DC 20268-0001
November 13, 1996
the foregoing
in
of practice.