UNITED STATES OF AMERICA Before The POSTAL RATE COMMISSION WASHINGTON, D.C. 20268-0001 Postal Rate and Fee Changes, ,uLIQ 3 13Yji(~~ ,,~,:, ‘J:. ‘~! :,,.T :, 1;: ,~ p:s; ;.i.(j ‘7,~ ,~; I .,!11 6~,,,,I;E 2000) Docket No. R2000-1 OFFICE OF THE CONSUMER ADVOCATE INTERROGATORIES TO UNITED STATES POSTAL SERVICE WITNESS PATELUNAS (OCA/USPS-ST44-13-32) JULY 20,200O Pursuant Commission, requests to Sections the Office of the Consumer for production Instructions to test year included Advocate of documents, purpose of the development revisions 26 and 27 of the, Rules of Practice of the Postal Rate of changes forecasts and These interrogatories are submitted to the OCA’s direct case-in-chief for the with OCA interrogatories 2000, are hereby incorporated hereby submits interrogatories development of rebuttal OCAAJSPS-1-14 by reference. Respectfully submitted, TED P. GERARDEN Director Office of the Consumer SHELLEY Attorney 1333 H Street, N.W. Washington, D.C. 20268-0001 (202) 789-6830; Fax (202) 789-6819 S. DREIFUSS u Advocate dated and for the in supporting testimony. January 24, 2 Docket No. RZOOO-1 OCANSPS-ST44-13. Attachment Please compares refer to the Attachment the “after-rates” to this interrogatory. effects on costs for the “Statements and Expense” filed by witness Tayman as Exh. USPS-9A “Statements 2000. of Revenue and Expense” (a) Please cost segment as compared explain Mailhandlers in full why the 12,2000, the in the “after-rates” with the on July 7, effect on the to all the other segments. “after-rates” effect on Clerks and costs is so slight in your exhibit (a 0.9% after- rates effect) versus a 1.7% after-rates from of Revenue filed by you as Exh. USPS-ST-44A This question focuses on the marked difference “Clerks and Mailhandlers” on January The Attachment effect in witness that no other Tayman’s cost exhibit. segment (Observe displays this phenomenon.) (b) If this effect is due to a non-volume-variable “cost reduction” program” change, provide testimony or exhibits, please so state. Also, citations or any Postal Service library references, or “other to your that shed light on this phenomenon. (4 If this effect is due to a “cost reduction” what distribution subclasses. or “other program” change, explain key was used to distribute the change to the classes and Attachment to Interrogatory OCAIUSPS-ST-44-13 NBR PATELUNAS NAR Difference Postmasters Managers, Supervisors & Technical Clerks & Mailhandlers Cag K Clerks City Carriers Vehicle Service Drivers Spec. Delivery Messengers Rural Carriers Custodial & Maintenance Motor Vehicle Services Miscellaneious Local Operations Contract Transport Building Occupancy Research & Developmt Equip. Maint. & Mgmt Training Support Supplies & Services HQ, Adminis., Corp. Personnel Depreciation, Write-Offs, Claims, Interest Final Adjustments 1839.5 3830.5 19269.6 8.7 13716.2 529.9 0 4507.9 2799.9 738.3 361.4 4774.9 1582.7 45.3 52.5 4077.4 5883.5 4330.2 9.2 1832.8 3790.9 19088.3 8.6 13571 518.3 0 4462.7 2788.6 736.6 361.2 4635 1582.7 45.3 52.5 4070 5883.5 4205.4 8.6 6.7 39.6 181.3 0.1 145.2 11.6 0 45.2 11.3 1.7 0.2 139.9 0 0 0 7.4 0 124.8 0.6 TOTAL ACCRUED COSTS 68357.5 67642.1 715.4 .” .. - % NBR 0.4% 1.0% 0.9% 1.1% 1.1% 2.2% TAYMAN NAR 1.0% 0.4% 0.2% 0.1% 2.9% 0.0% 0.0% 0.0% 0.2% 0.0% 2.9% 6.5% 1876.3 3822 19442.5 9.7 13787.1 523 0 4399.9 2791.9 724.3 328 4755.1 1633.7 45.3 48.5 3814.2 5767.2 4274.8 3 1869.4 3782.6 19118.1 9.6 13638.1 511.9 0 4355.6 2780 722.7 327.8 4619.6 1633.7 45.3 48.5 3807.5 5767.2 4150 2.8 1 .O% 68046.6 67190.6 - . . .^ .- Difference % 6.9 39.4 324.4 0.1 149 11.1 0 44.3 11.9 1.6 0.2 135.5 0 0 0 6.7 0 124.8 0.2 0.4% 1.0% 1.7% 1.0% 1.1% 2.1% 1.0% 0.4% 0.2% 0.1% 2.8% 0.0% 0.0% 0.0% 0.2% 0.0% 2.9% 6.7% 856 1.3% Docket No. R2000-1 3 OCANSPS-ST44-14. Services” million, Please is $255 from underlying Exh. USPS-ST-44A Cite to testimony, that your FY 2000 estimate million higher. than witness assumptions also provide confirm and and changes Exh. Tayman’s USPS ($3805.6 & million - 3550.6 9A, respectively). that cause such a dramatic exhibits, or library references of “Supplies Explain increase all in this cost. that shed light on this phenomenon; any other primary or intermediate sources for the determination of this cost. OCANSPS-ST44-15. Services” million, Please is $263.2 from underlying USPS-ST-44A assumptions also provide that your million higher than witness Exh. Cite to testimony, confirm and and changes exhibits, Exh. TYBR estimate Tayman’s ($4077.4 USPS any other primary or intermediate & million - 3814.2 9A, respectively). that cause such a dramatic or library references of “Supplies Explain increase all in this cost. that shed light on this phenomenon; sources for the determination of this cost. OCAfUSPS-ST44-16. & Corporate Personnel million - 5414.7 phenomenon; determination Costs” is $96 million higher than witness million, from Exh. USPS-ST-44A Explain all underlying this cost. Please confirm that your FY2000 estimate of “HQ & Area Admin. assumptions Cite to testimony, also provide of this cost, ($5510.7 and Exh. USPS 9A, respectively). and changes that cause such a dramatic increase in exhibits, any Tayman’s other or library references primary that shed or intermediate light on this sources for the 4 Docket No. R2000-1 OCANSPS-ST44-17. Corporate Personnel million - 5767.2 Admin. & Costs” is $116.3 million higher than witness Tayman’s ($5883.5 million, from Exh. USPS-ST-44A Explain all underlying this cost. Please confirm that your TYBR estimate of “HQ &Area assumptions Cite to testimony, phenomenon; determination also provide and changes that cause such a dramatic increase exhibits, any and Exh. USPS 9A, respectively). or library other primary references or that shed light on this intermediate sources for the of this cost. OCANSPS-ST-44-18. Please refer to Exhibit USPS-ST-44AB. “Key Inflation in the original filing versus the revised filing, the % change annual in Indices” index for FY 2000, “CPI-Urban Wage and Clerical In the table comparing Workers,” in has been an increase of 0.56%, i.e., 3.29% for the revised filing versus 2.73% in the original filing. Please give a ballpark estimate for the percentage cost figure for FY 2000 that is directly affected Workers index. CPI-Urban of the $65.1715 billion total accrued by the CPI-Urban Wage and Clerical Also state all cost segments/components directly affected by use of the Wage and Clerical Workers index. OCANSPS-ST-44-19. Please refer to Exhibit USPS-ST-44AB. In the table comparing “Key Inflation Indices” in the original filing versus the revised filing, the annual index for FY 2000, “ECI-Wages and Salaries-Private Industry,” has not been changed, 3.22 % index figure is used both in the revised filing and the original filing. a ballpark estimate for the percentage of the $65.1715 for FY 2000 that is directly affected by the ECI-Wages Le., a Please give billion total accrued cost figure and Salaries-Private Industry Docket No. R2000-1 index. 5 Also state all cost segments/components Wages and Salaries-Private OCANSPS-ST-44-20. “Key Inflation directly affected Industry index. Please refer to Exhibit USPS-ST-44AB. estimate for the percentage affected of the $65.1715 by the Public Please give a ballpark billion total accrued cost figure for FY 2000 Transportation index. Also segments/components directly affected by use of the Public Transportation OCAfUSPS-ST-44-21. Please refer to Exhibit USPS-ST-44AB. “Key Inflation i.e., 6.17% state all cost index. In the table comparing Indices” in the original filing versus the revised filing, the % change annual index for FY 2000, “Transportation for the revised filing versus ballpark estimate for the percentage FY 2000 that is directly affected cost segments/components Services,” 3.78% in the original of the $65.1715 affected in has been an increase of 2.39%, filing. Please give a billion total accrued cost figure for by the Transportation directly in has been an increase of 4.67%, i.e., 7.22% for the revised filing versus 2.55% in the original filing. is directly In the table comparing Indices” in the original filing versus the revised filing, the % change annual index for FY 2000, “Public Transportation,” that by use of the ECI- Services index. Also state all by use of the Transportation Services index. OCANSPS-ST-44-22. “Key Inflation Please refer to Exhibit USPS-ST-44AB. In the table comparing Indices” in the original filing versus the revised filing, the % change annual index for FY 2000, “Rent,” has been a decrease revised filing versus 3.33% in the original filing. in of 0.04%, i.e., 3.29% for the Please give a ballpark estimate for the Docket No. R2000-1 percentage affected 6 of the $65.1715 by the Rent index. billion total accrued cost figure for FY 2000 that is directly Also state all cost segments/components directly affected by use of the Rent index. OCANSPS-ST-44-23. Please refer to Exhibit USPS-ST-44AB. “Key Inflation in the original filing versus the revised filing, the % change Indices” annual index for FY 2000, “Supplies & Materials,” that is directly affected of the $65.1715 by the Supplies Please give a ballpark billion total accrued cost figure for FY 2000 & Materials index. Also state all cost segments/components directly affected by use of the Supplies & Materials index. OCAAJSPS-ST-44-24. Please refer to Exhibit USPS-ST-44AB. “Key Inflation in the original filing versus the revised filing, the % change Indices” annual index for FY 2000, “Electricity,” directly of the $65.1715 affected by the Electricity In the table comparing in has been an increase of 2.94%, i.e., 2.69% for the revised filing versus - 0.25% in the original filing. the percentage in has been an increase of 1.28%, i.e., 4.42% for the revised filing versus 3.14% in the original filing. estimate for the percentage In the table comparing Please give a ballpark estimate for billion total accrued index. cost figure for FY 2000 that is Also state all cost segments/components directly affected by use of the Electricity index. OCANSPS-ST-44-25. Please refer to Exhibit USPS-ST-44AB. “Key Inflation in the original filing versus the revised filing, the % change Indices” In the table comparing in annual index for FY 2000, “Gas & Oil,” has been an increase of 13.03%, i.e., 30.69% for the revised filing versus 17.66% in the original filing. Please give a ballpark estimate 7 Docket No. R2000-1 for the percentage directly affected of the $65.1715 billion total accrued by the Gas & Oil index. cost figure for FY 2000 that is Also state all cost segments/components directly affected by use of the Gas & Oil index. OCAAJSPS-ST-44-26. Please refer to Exhibit USPS-ST-44AB. “Key Inflation Indices” in the original filing versus the revised filing, the % change annual index for FY 2000, “Air Freight,” has been a decrease the revised filing versus 1.98% in the original filing. the percentage directly affected of the $65.1715 index. in of 1.08%, i.e., 0.90% for Please give a ballpark estimate for billion total accrued by the Air Freight In the table comparing cost figure for FY 2000 that is Also state all cost segments/components directly affected by use of the index. OCAIUSPS-ST-44-27. Please refer to Exhibit USPS-ST-44AB. “Key Inflation Indices” in the original filing versus the revised filing, the % change annual index for FY 2000, “Interstate i.e., 3.80% for the revised in the original of the $65.1715 directly affected filing. Please give a billion total accrued cost figure for FY 2000 that is directly affected by the Interstate Trucking cost segments/components in Trucking Costs,” has been an increase of 1.16%, tiling versus 2.64% ballpark estimate for the percentage In the table comparing Costs index. by use of the Interstate Also state all Trucking Costs index. OCAIUSPS-ST-44-28. (a) Please confirm the following statements: The Postal Service’s reflects more current revised total accrued cost estimate for FY 2000 key inflation indices than the original total accrued Docket No. R2000-1 8 cost estimate for FY 2000 filed on January 12, 2000. If you do not confirm, then present all reasons for not confirming. (b) As a result of the use of more current key inflation indices in the revised filing (versus the original filing), the revised total accrued cost estimate for FY 2000 is likely to be more accurate than the original estimate. If you do not confirm, then present all reasons for not confirming. OCANSPS-ST-44-29. (a) Please confirm the following statements: The Postal Service’s revised total accrued cost estimate for the FY 2001 test year reflects more current key inflation indices than the original total accrued cost estimate for the FY 2001 test year filed on January 12, 2000. If you do not confirm, then present all reasons for not confirming. (b) As a result of the use of more current key inflation indices in the revised filing (versus the original filing), the revised total accrued cost estimate for the FY 2001 test year is likely to be more accurate estimate. If you do not confirm, then present than the original all reasons for not confirming. OCANSPS-ST-44-30. For each of the Key Inflation Indices set forth in Exh. USPS-ST- 44AB, state the date that original filing inflation index was generated, Urban Wage and Clerical Workers, Public Transportation, (g) Electricity, (b) ECI-Wages (d) Transportation Services, i.e., for (a) CPI- and Salaries-Private Industry, (c) (e), Rent, (f) Supplies & Materials, (h) Gas & Oil, (i) Air Freight, and (j) Interstate Trucking Costs. Then state Docket No. R2000-1 9 how many months later the revised filing inflation index was generated. information for all Key Inflation Indices used for FY 2000 and FY 2001 (Test Year). OCAIUSPS-ST-44-31. applied Provide this the formula Please refer to USPS-T-9 “Employment Cost at 19, lines 3-14. Index for Wages Industry, less one percent, (ECI minus 1) for bargaining effective in the test year.” Have you applied your revised estimate of bargaining and Salaries for Private units that do not have contracts the same formula, i.e., ECI minus 1, in unit wages for the test year (excluding contract extends through the test year)? OCAIUSPS-ST-44-32. Witness Tayman NALC whose If not, explain fully. Please refer to the following news item published in PostCom Bulletin, July 14, 2000: STRASSER REVEALS NET LOSS, BOG APPROVES FUNDING. At the July 11 USPS Board of Governors meeting, Acting Chief Financial Officer and Executive Vice President Richard J. Strasser, Jr. that a big portion of the unplanned costs in fiscal year 2000 was due to workers’ compensation increases of $100 million, transportation and fuel cost increases of $240 million, and cost of living raises of $50 million. Every penny increase in the price of gasoline adds $5 million to annual transportation costs. (4 Has PostCom accurately of Governors? reported Mr. Strasser’s statements to the Board If not, please provide the correct figures and state their source. (b) Have the cited $100 million of workers’ directly presented incorporated into the in USPS-ST-44A? FY 2000 compensation total accrued increases cost been estimate If so, explain how it has been incorporated, 10 Docket No. R2000-1 including citations to testimony, other exhibits, this increase has not been incorporated, (c) incorporated presented including into the in USPS-ST-44A? FY 2000 citations to testimony, the cited incorporated total other exhibits, million of cost If so, explain to testimony, accrued other CERTIFICATE of living raises cost estimate exhibits, and library been directly presented in including references. If this document upon all OF SERVICE in accordance with Section Practice. ,,e,,,,,_ Stephanie Washington, D.C. 20268-0001 July 20, 2000 If explain why not. I hereby certify that I have this date served the foregoing of record in this proceeding estimate and library references. how it has been incorporated, increase has not been incorporated, participants cost been explain why not. into the FY 2000 total accrued USPS-ST-44A? citations $50 and fuel increases If so, explain how it has been incorporated, this increase has not been incorporated, Have If explain why not. Have the cited $240 million of transportation directly (4 and library references. .~ecu? S. Wallace 12 of the Rules of
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