PRC rejects USPS effort to shut down public inquiry into Delivering for America

Steve HutkinsBlog, Featured

The Postal Regulatory Commission has denied the Postal Service’s Motion for Reconsideration of the order creating a Public Inquiry docket into the Delivering for America plan (Order No. 6548). The Commission has also issued its first information request about the plan.

In its motion, the Postal Service had argued that the Commission was acting outside of its authority in establishing the public inquiry. “The Commission should use established mechanisms to ensure adequate oversight, consistent with its past decisions and its statutory authority,” wrote the Postal Service. “An open-ended PI docket that encompasses review of all possible initiatives under the Plan is wholly unnecessary, unwarranted, and contrary to the Commission’s statutory authority.”

In denying the motion for reconsideration today, the Commission states that the motion was premature: “The Commission has merely opened a docket, creating a forum to learn more about strategic plan initiatives that may have a significant impact on the postal community. The Commission has not issued any orders or directed the Postal Service to take any action in this proceeding.  By opening this inquiry, the Commission has not required the Postal Service to delay the implementation of any DFA Plan initiatives or required the Postal Service to postpone further strategic planning.”

As for the scope of the Commission’s authority, today’s order says, “39 U.S.C. § 503 grants the Commission general authority to take any action that is ‘necessary and proper’ to carry out its ‘functions and obligations’ under Title 39 of the United States Code.”

And as for the Postal Service’s claim that Section 503 does not allow the Commission to open this docket because this inquiry is not related to another Title 39 provision, the Commission states flatly, “The Postal Service is mistaken.”

Also today the Commission issued its first information request about the DFA plan, some of which integrates questions posed in an information request submitted by PostCom back in April.

The Commission asks the Postal Service to provide a schedule of planned facility activations, including Sort and Delivery Centers (S&DCs), Regional Processing & Distribution Centers (RPDCs), Local Processing Centers (LPCs), Destination Hubs (DHUBs), and any other facility contemplated as part of the DFA Plan, with the location, facility type, planned date of activation, and existing facilities that will be affected and how.

The Commission also asks the Postal Service to provide details about the $34 billion in cost savings promised in the DFA plan, with “documentation with any analysis or study the Postal Service prepared to estimate the cost savings associated with that initiative.”

The Commission then notes the apparent contradiction in the Postal Service’s statements about post office closings. The DFA plan itself refers to closing some stations and branches, but the Second Year Progress Report (as well as other Postal Service statements and the Postmaster General’s testimony to Congress) says that no post offices will be closed as a result of the Sorting & Delivery Center plan.

The Commission therefore asks the Postal Service to “confirm that no post offices will be closed as part of the DFA Plan” and “customers will not experience any changes to their local post office retail operations.”

Finally, the Commission’s information request asks the Postal Service to explain why it has determined seeking an advisory opinion was not necessary prior to the implementation of its new facilities and corresponding processing and logistics network realignments.

It’s not clear what will happen next. The Postal Service could proceed to participate in the proceeding and, as the Commission observes, simply object to individual questions or request non-public treatment of particular responses. In a footnote in the first information request, the Commission also invites the Postal Service to request an informal, off-the-record technical conference to address some aspects of the DFA plan.

A third possibility is that the Postal Service will appeal the Commission’s order denying its motion for reconsideration. That would send the matter to the DC Circuit, where it will take many months before the issue is resolved.

It’s entirely possible that the Postal Service will take this third route since the Postmaster General believes, as he testified to Congress, the PRC’s interference “is not helpful. It is going to put this whole plan in jeopardy.”

If the Postal Service does take this issue to the DC Circuit, it would presumably refuse to respond to information requests while the matter is before the court. The Commission has the power to issue subpoenas, but the Postal Service has already warned the Commission against doing so. As the Postal Service stated in its motion for reconsideration, “An attempt to use the Commission’s subpoena power as a legal basis to initiate Docket No. PI2023-4 would be mistaken.”

The Commission has given the Postal Service until June 28 to respond to the first information request, so we shouldn’t have to wait too long before we learn where this is all headed.

—Steve Hutkins

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