Revised Service Standards for Market-Dominant Mail Products, 31190-31200 [2012-12564]

Agencies

• Postal Service

[Federal Register Volume 77, Number 102 (Friday, May 25, 2012)]
[Rules and Regulations]
[Pages 31190-31200]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-12564]


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POSTAL SERVICE

39 CFR Part 121


Revised Service Standards for Market-Dominant Mail Products

AGENCY: Postal ServiceTM.

ACTION: Final rule with phased implementation dates.

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SUMMARY: The Postal Service is revising the service standards for 
market-dominant mail products, as part of its Network Rationalization 
initiative. Some portions of the new standards will be implemented in 
two phases.

DATES: Effective date: July 1, 2012. Please see SUPPLEMENTARY 
INFORMATION

[[Page 31191]]

section for phased implementation dates.

FOR FURTHER INFORMATION CONTACT: Wendy Hocking, Industry Engagement and 
Outreach, at 202-268-8149.

SUPPLEMENTARY INFORMATION:

Table of Contents

I. Introduction.
II. Comments.
III. Decision To Conduct Phased Implementation.
IV. Response to Comments.
V. Statutory Considerations.
VI. Explanation of Final Rules.

I. Introduction

    On September 21, 2011, the Postal Service published an advance 
notice of proposed rulemaking (the Advance Notice) in the Federal 
Register to solicit public comment on a conceptual proposal to revise 
service standards for market-dominant products.\1\ After considering 
comments received in response to the Advance Notice, the Postal Service 
decided to develop the concept into a concrete proposal, termed Network 
Rationalization. The basic logic of Network Rationalization is that 
falling mail volumes and the resultant excess capacity in the Postal 
Service's mail processing network necessitate a major consolidation of 
the network, and this task in turn is contingent on revisions to 
service standards, particularly the overnight standard for First-Class 
Mail.
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    \1\ Proposal To Revise Service Standards for First-Class Mail, 
Periodicals, and Standard Mail, 76 FR 58433 (Sept. 21, 2011).
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    On December 5, 2011, the Postal Service submitted a request to the 
Postal Regulatory Commission (PRC) for an advisory opinion on the 
service changes associated with Network Rationalization, in accordance 
with 39 U.S.C. 3661(b).\2\ On December 15, 2011, the Postal Service 
published proposed revisions to its market-dominant service standards 
in the Federal Register and sought public comment (the Proposed 
Rulemaking).\3\ The comment period for the Proposed Rulemaking closed 
on February 13, 2012.
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    \2\ PRC Docket No. N2012-1, Request of the United States Postal 
Service for an Advisory Opinion on Changes in the Nature of Postal 
Services (Dec. 5, 2011). Documents pertaining to the Request are 
available at the PRC Web site, https://www.prc.gov.
    \3\ Service Standards for Market-Dominant Mail Products, 76 FR 
77942 (Dec. 15, 2011).
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    Having considered comments responsive to the Proposed Rulemaking, 
informal advice that the Postal Service has received through other 
channels, and the results of its market research, the Postal Service 
has decided to implement Network Rationalization in a phased manner. 
The Postal Service believes that the initiative will help ensure its 
long-term viability, and that it complies with all applicable statutory 
requirements. This Notice explains the new rules and their phased 
implementation.

II. Comments

    The Postal Service received 101 written comments in response to the 
Proposed Rulemaking. These responses came from a variety of sources, 
including retail and residential customers, businesses, periodicals 
publishers, mailer trade associations, postal unions, members of 
Congress, and others. As was the case for the Advance Notice, the 
majority of written comments received in response to the Proposed 
Rulemaking opposed Network Rationalization. Some commenters questioned 
various aspects of the initiative but ultimately supported it. A few 
supported it without reservation.
    Commenters focused on the following concerns. They stated that the 
lengthened service standards would unreasonably burden many customers. 
They said, for example, that rural customers who depend on the Postal 
Service for vital deliveries, such as prescription medicines and 
paychecks, would be hurt, that businesses that receive remittance mail 
would suffer financial losses, and that periodicals would see their 
subscriptions decline. Commenters feared that the proposal could delay 
mailed election ballots from reaching their destinations, potentially 
causing some ballots not to be counted. Some mailers stated that it 
would not be possible for them to meet the new Critical Entry Times set 
forth in the Proposed Rulemaking. Overall, many commenters cautioned 
that Network Rationalization could accelerate mail volume declines, 
with customers abandoning the postal system for electronic 
alternatives. Accordingly, they suggested that the Postal Service 
achieve financial stability through other means, such as eliminating 
discounts, shifting to five-day or even three-day delivery, and seeking 
legislative relief from having to prefund the Retiree Health Benefits 
Fund.
    Some commenters did not oppose the proposal but nevertheless 
questioned aspects of its planning, communication, and implementation. 
This was especially true for businesses and larger customers. For 
example, some characterized the Postal Service's current performance in 
meeting service standards as poor, and they wondered whether the Postal 
Service would improve performance under the new standards. Others 
expressed skepticism as to the Postal Service's ability to achieve its 
projected cost reductions. Moreover, they inferred that the initiative 
would shift costs to mailers, and asked why the Postal Service had not 
analyzed such cost impacts. Commenters also pointed out that increased 
costs to customers and decreased service levels are analogous to price 
increases. Some mailers expressed concerns about potentials for loading 
dock shortages and longer waiting times at mail entry locations, given 
the smaller number of mail processing facilities after implementation 
of Network Rationalization.
    More generally, some commenters stated that the proposed 
implementation dates are too early, and they questioned the prudence of 
the Postal Service implementing the initiative before receiving the 
PRC's advisory opinion. In addition, some criticized the Postal 
Service's communication of its plans, particularly of details such as 
new mailing eligibility and software requirements.
    A small minority of written comments supported Network 
Rationalization without reservation, encouraging the Postal Service to 
take whatever steps are necessary for it to remain a viable, self-
supporting entity. One commenter noted that Network Rationalization 
could provide significant cost savings and could improve the 
attributable cost coverage of the Periodicals class of mail.
    In addition to the written comments, the Postal Service received 
informal opinions and advice from commercial mailers, mailer 
associations, and members of Congress. The mailers and associations 
mostly supported Network Rationalization, while Congressional opinion 
was mixed.

III. Decision To Conduct Phased Implementation

    After considering the formal rulemaking comments, the range of 
other informal advice it has received, and the results of its market 
research, and after considering the requirements of 39 U.S.C. 3691 and 
other applicable provisions of title 39, the Postal Service has 
determined to implement Network Rationalization, but on a more gradual 
timeline than it initially envisioned. The Postal Service is adopting 
new rules for market-dominant service standards, with an interim 
version that will apply from July 1, 2012, through January 31, 2014, 
and a final version that will apply on February 1, 2014, and 
thereafter. From the outset, the Postal Service has understood that 
implementation of Network Rationalization will require more than one 
year. The phased

[[Page 31192]]

application of the new rules accommodates this reality and also 
provides the Postal Service with enough flexibility that, should 
subsequent events or changed circumstances so warrant, the Postal 
Service will be able to revisit the final version before February 1, 
2014, and amend or withdraw it, as appropriate, through a new notice-
and-comment rulemaking.
    On July 1, 2012, coinciding with the effectiveness of the interim 
version of the new rules, the Postal Service will begin implementing 
the first phase of Network Rationalization. It will suspend Phase One 
from September 1, 2012, through December 31, 2012, to avoid disrupting 
the fall election and holiday mailing cycles, and resume it thereafter. 
The Postal Service will begin implementing the second phase on February 
1, 2014, coincident with the application of the final version of the 
new rules.
    The interim version of the new rules differs from the final version 
in three respects: (1) The interim version applies an overnight service 
standard to all intra-Sectional Center Facility (SCF) First-Class Mail, 
regardless of the point of entry or level of preparation, whereas the 
final version applies it only to intra-SCF First-Class Mail pieces that 
are entered at the SCF and meet specified preparation and entry time 
requirements; (2) the interim version applies a two-day service 
standard to First-Class Mail pieces if there is a six-hour or less 
driving time between the pieces' origin Processing and Distribution 
Center or Facility (P&DC/F) and destination Area Distribution Center 
(ADC), whereas the final version applies it if there is a six-hour or 
less driving time between the pieces' origin P&DC/F and destination 
SCF; and (3) the interim version modifies the delivery day range for 
end-to-end Periodicals in the contiguous forty-eight states from the 
current one to nine days to two to nine days, while the final version 
modifies it further to three to nine days (under both the interim and 
final versions, there will continue to be an overnight service standard 
for qualifying destination-entry Periodicals).
    Operationally, the principal benefit of the new rules is that they 
will allow the Postal Service to expand its nightly processing window, 
smoothing out the peak volume load over more of the workday, thereby 
reducing the number of processing locations needed in the network. 
Presently, the Postal Service's delivery point sequencing (DPS) 
operations are generally run for six and one-half hours per day, from 
12:30 a.m. to 7 a.m. Once implementation of Phase One is complete, the 
DPS window will expand to up to ten hours, from 8 p.m. to 6 a.m. This 
change will facilitate the consolidation of the mail processing 
operations of approximately 140 facilities. Then, once implementation 
of Phase Two is complete, the DPS window will expand to up to sixteen 
hours, from 12 p.m. to 4 a.m. This will make possible the consolidation 
of the mail processing operations of approximately 230 facilities 
(inclusive of the approximately 140 consolidated in Phase One).
    As discussed in the sections below, the Postal Service is convinced 
that Network Rationalization is vital to its long-term viability. At 
the same time, the Postal Service is well aware that sudden changes to 
systems as complex as its mail processing network can precipitate 
unintended consequences. Accordingly, the Postal Service has decided on 
the extended, phased implementation schedule outlined above to help 
ensure that Network Rationalization proceeds in a steady, measured 
fashion, with a minimal level of disruption.
    Of course, the Postal Service's phased implementation schedule by 
its nature builds in time for additional deliberation and 
consideration. As noted above, the Postal Service recognizes the 
possibility that subsequent events or changed circumstances could cause 
it at a future date to revisit the final version of the new rules that 
will apply beginning on February 1, 2014, and to alter or withdraw 
those rules through a new notice-and-comment rulemaking. At this time, 
however, the Postal Service expects to implement the new rules and 
Network Rationalization as set forth in this Notice.

IV. Response to Comments

    As the Postal Service implements Network Rationalization, it will 
remain mindful of the concerns expressed by commenters and will work to 
minimize those concerns. In response to commenters who stated that 
Network Rationalization may lead to accelerated volume declines, the 
Postal Service notes that the initiative is largely focused on First-
Class Mail, a mail class that has seen and will continue to see 
significant volume declines. These declines are linked, in large part, 
to electronic diversion, a secular trend that is outside the Postal 
Service's control. The Postal Service has conducted market research to 
estimate the additional volume that could be lost due to Network 
Rationalization, and it believes that the estimated losses are 
acceptable when compared to the initiative's likely benefits.
    The Postal Service observes that the alternatives proposed by 
commenters would not, by themselves, restore the Postal Service to 
lasting financial viability. Furthermore, many of the suggested 
alternatives require the enactment of legislation. The Postal Service 
has diligently sought such legislation, particularly with regard to the 
Retiree Health Benefits Fund and five-day delivery, but progress has 
been slow, and the prospects for timely enactment, if any, remain 
unclear. On the revenue front, customers have strongly opposed the 
Postal Service's pursuit of an exigent rate increase, and the PRC has 
thus far rejected it. As for cost reductions outside of Network 
Rationalization, the Postal Service is pursuing other cost-saving 
initiatives simultaneously with Network Rationalization, but neither 
Network Rationalization nor any of the other initiatives is sufficient 
in itself to secure the Postal Service's financial stability. Rather, 
they are all necessary. And, even in the realm of mail processing, the 
Postal Service has continually pursued consolidation opportunities 
wherever feasible, but it is now reaching the limit of consolidations 
that can be effected without altering service standards nationwide.
    Though it is true that Network Rationalization will burden some 
customers, most of these burdens can be minimized through relatively 
minor changes on the part of customers. For example, pharmaceutical 
companies can minimize gaps in prescription fulfillment by continuing 
to remind customers to place their refill orders in a timely manner. 
Likewise, customers who mail bill payments and are concerned that their 
payments may arrive late can mail their payments one or two days 
earlier than they do now. In addition, businesses that rely on 
remittance mail can still obtain overnight First-Class Mail service for 
their outgoing mail by meeting the new preparation and entry 
requirements outlined in Section VI below, and they can speed their 
receipt of incoming mail by using Caller Service at the destinating 
processing facility. Indeed, the Postal Service expects overnight 
Caller Service at destinating processing facilities to improve, given 
the larger mail processing operating windows.
    The Postal Service believes that its cost savings estimates for 
Network Rationalization are, generally speaking, somewhat conservative, 
and it is confident that it can achieve the

[[Page 31193]]

savings.\4\ It also recognizes that the initiative will cause 
additional costs for some customers, as most major service changes do. 
In the Advance Notice, the Postal Service requested that customers 
provide information on ``the nature and extent of costs or savings they 
might experience,'' including ``empirical data supporting any cost-
benefit analysis.'' The Postal Service did not receive any responsive 
information, and it does not itself possess such information.
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    \4\ One reason for the estimates' conservatism is that the 
underlying calculations hew to PRC methodologies, some of which 
incorporate assumptions that are, in the Postal Service's view, 
unrealistic.
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    Furthermore, the Postal Service would point out that the decision 
to pursue Network Rationalization does not hinge on a particular level 
of savings in the short term. Rather, the initiative is driven 
substantially by the reality that falling mail volumes have created 
significant excess capacity in the Postal Service's mail processing 
network. Network Rationalization is aimed at realigning the network 
with current mail volume trends. As time goes on, and mail volumes 
continue to decline, the cost savings will grow.
    In response to mailers' concerns about potentials for loading dock 
shortages and longer waiting times at mail entry locations, the Postal 
Service will expand appointment windows at facilities and modify volume 
restrictions. Further, the Postal Service plans to retain all current 
business mail entry units (BMEUs) for the time being. Should the Postal 
Service decide to relocate or consolidate any BMEU operations, it will 
notify mailers 120 days beforehand, and it will relocate or consolidate 
the units to nearby locations that minimize impacts on mailers. As the 
Postal Service moves forward with implementation, it is committed to 
communicating any changes simply and clearly.
    Finally, with respect to the Postal Service's decision to move 
forward with Network Rationalization before receiving the PRC's 
advisory opinion, it is notable that the Postal Service filed its 
advisory opinion request more than 160 days before the publication of 
this Notice and more than 200 days before the July 1, 2012, 
implementation date. The PRC's rules require that such requests be 
filed at least ninety days before implementation.\5\ The time between 
the filing of the Postal Service's request and the implementation of 
Phase One has provided the PRC with a reasonable period within which to 
issue an opinion. It appears now, however, that the PRC will not be 
able to issue an opinion before Phase One implementation commences. 
Nevertheless, the ongoing proceedings have enhanced the Postal 
Service's deliberations, and, given the extended implementation 
schedule that the Postal Service has adopted, the PRC's advisory 
opinion, when issued, can still provide valuable guidance to postal 
management during the implementation process.
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    \5\ 39 CFR 3001.72.
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V. Statutory Considerations

    In addition to considering comments, the Postal Service has 
considered the requirements of 39 U.S.C. 3691 and other applicable 
provisions of title 39. Section 3691(b) sets forth objectives that the 
Postal Service's market-dominant service standards must serve, and 
Section 3691(c) sets forth factors that the Postal Service must take 
into account when revising the service standards. The Postal Service 
believes that it has properly considered the subsection (c) factors, 
and that the revised service standards achieve the subsection (b) 
objectives.
    Since the passage of the Postal Reorganization Act (PRA), the 
Postal Service has been required to be largely self-supporting. The PRA 
established a cost-of-service system, which allowed the Postal Service 
to set prices at levels necessary to fully cover its costs. This system 
was dramatically altered in 2006 with the passage of the Postal 
Accountability and Enhancement Act (PAEA). In contrast to the PRA, the 
PAEA established a price cap system, with strict limitations on price 
increases for market-dominant product classes. As the PRC has observed, 
a primary goal of the price cap system is ``to incent the Postal 
Service to reduce costs and improve efficiency.'' \6\
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    \6\ PRC Docket No. R2010-4, Order No. 547 (Sept. 30, 2010), at 
80.
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    Section 3691 is situated within this larger context of inducing 
efficiency gains, and the subsection (c) factors are aligned with that 
goal in that, taken together, they balance levels of service for 
customers with the Postal Service's operational and business needs. 
From the formal rulemaking comments that the Postal Service has 
received, it is clear that some customers view the current service 
standards as vitally important, and that some customers would 
experience difficulties if service standards are lengthened. On a 
broader level, however, it appears that the public as a whole does not 
view the current service standards as an essential element of the mail.
    The Postal Service has conducted market research into potential 
consumer and business reactions to the proposed service standard 
changes.\7\ Most of the surveyed consumers and small businesses stated 
that the service standard changes would have a limited impact on their 
mailing behavior. Importantly, these customers believed that they could 
easily adapt to the proposed changes by, among other things, mailing 
earlier than they do now. Moreover, many customers were unaware of the 
current service standards, and mistakenly believed that the current 
service standards are of longer duration than they actually are. Larger 
commercial mailers were also accepting of the service standard changes 
and generally indicated that they would be able to adapt. Of course, 
some commercial mailers, such as remittance mailers, have a significant 
financial interest in sustained local overnight First-Class Mail 
service. The new rules make it possible for many of them to retain such 
service.
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    \7\ See PRC Docket No. N2012-1, Direct Testimony of Rebecca 
Elmore-Yalch on Behalf of the United States Postal Service (USPS-T-
11) (Dec. 5, 2011); and PRC Docket No. N2012-1, Direct Testimony of 
Greg Whiteman on Behalf of the United States Postal Service (USPS-T-
12) (Dec. 5, 2011), available at https://www.prc.gov.
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    In its market research, and through its ongoing dialogue with 
mailers, the Postal Service found that most consumers and businesses 
would not prefer a significant price increase in lieu of the proposed 
service standard changes. Thus, their views seem to align with the 
PAEA's overall framework of limiting price increases to induce 
efficiency gains. Overall, then, while the revised service standards 
will burden some customers, it appears that they will satisfy most 
customers' mailing needs and will be broadly acceptable to the mailing 
public.
    In regard to the subsection (c) factors that relate to the Postal 
Service's operational and business needs, the Postal Service has 
already set forth, in the Proposed Rulemaking, the mail volume and 
financial realities that necessitate Network Rationalization. Annual 
First-Class Mail volume peaked in 2001 at 103.7 billion pieces, and 
since then it has fallen by about 30 billion pieces, or 29 percent. 
Because the Postal Service's mail processing network was principally 
designed to achieve First-Class Mail service standards, the decline in 
First-Class Mail volume has made it difficult for the Postal Service to 
consolidate the network quickly enough to align with current volumes. 
The Postal Service expects the declines to continue into the 
foreseeable future, with First-Class Mail forecast to drop from 74 
billion pieces in 2011 to 39 billion pieces in 2020, a

[[Page 31194]]

further 47 percent decline. Over this time, the number of addresses 
that the Postal Service serves will only grow, meaning that the Postal 
Service's revenue per delivery point will fall significantly. It is 
imperative, then, for the Postal Service to streamline its mail 
processing network.
    The Postal Service believes that the revised service standards are 
designed to achieve the Section 3691(b) objectives. First-Class Mail 
and Periodicals should retain most of their value to customers, because 
the service standards for most such mail will increase by only one day. 
Further, the network consolidations made possible by the service 
standard changes will result in a more nimble and sustainable Postal 
Service. The stability of the Postal Service should, to some degree, 
enhance the value of First-Class Mail and Periodicals, by allowing 
customers to depend on the affordability of these products into the 
foreseeable future.
    Network Rationalization will also help improve the Postal Service's 
performance in meeting service standards, by significantly enlarging 
the daily mail processing operating window. While the speed of delivery 
of First-Class Mail and Periodicals will diminish, somewhat reducing 
the value of the mail, this should be mitigated to some extent by the 
enhanced reliability of the service standards.

VI. Final Revisions to Service Standards

    The Postal Service's market-dominant service standards are 
contained in 39 CFR Part 121. The new version of 39 CFR part 121 
appears at the end of this Notice. The following is a summary of the 
revisions.

A. Service Standards Generally

    The service standards contained in 39 CFR Part 121 for each mail 
class can be divided into two elements: (1) A delivery day range within 
which all mail in a given class is expected to be delivered; \8\ and 
(2) business rules that determine the specific number of delivery days 
for each mail piece. Business rules are based on Critical Entry Times 
(CETs). The CET is the latest time on a particular day that a mail 
piece can be entered into the postal network and still have its service 
standard calculated based on that day (this day is termed ``day-
zero''). In other words, if a piece is entered before the CET, its 
service standard is calculated from the day of entry, whereas if it is 
entered after the CET, its service standard is calculated from the 
following day.\9\ For example, if the applicable CET is 5:00 p.m., and 
a letter is entered at 4:00 p.m. on a Tuesday, its service standard 
will be calculated from Tuesday, whereas if the letter is entered at 
6:00 p.m. on a Tuesday, its service standard will be calculated from 
Wednesday.
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    \8\ There are separate delivery day ranges for mail within the 
contiguous forty-eight states and mail that originates or destinates 
outside the contiguous forty-eight states.
    \9\ If the following day is a Sunday or holiday, the service 
standard is calculated from the next Postal Service delivery day.
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    CETs are not contained in 39 CFR Part 121, because they vary based 
on where mail is entered, the mail's level of preparation, and other 
factors. The CETs at retail collection points are generally listed at 
those points. For example, blue collection boxes list the time of day 
when mail is collected from them by the Postal Service; if a blue 
collection box lists three pick-up times on one day, the CET for that 
day is the latest listed pick-up time.
    The Postal Service will institute several new CETs on February 1, 
2014, when the final version of the new rules begin application, as 
described below. Of course, the CETs could be modified again in the 
future, as the operating environment that the Postal Service faces 
evolves.

B. First-Class Mail

    The Postal Service is not changing the general delivery day ranges 
for First-Class Mail. The delivery day range for First-Class Mail that 
originates and destinates in the contiguous forty-eight states will 
remain one to three days, and the delivery day range for First-Class 
Mail that originates or destinates in Alaska, Hawaii, American Samoa, 
Guam, Puerto Rico, or the U.S. Virgin Islands will remain one to five 
days. The Postal Service is, however, changing the First-Class Mail 
business rules.
1. Overnight Rule
    Under the current overnight business rule for First-Class Mail, the 
overnight service standard is applied to all intra-SCF mail, as well as 
to some inter-SCF mail pieces if a specified minimum level of mail 
volume regularly flows between the pieces' origin and destination 
SCFs.\10\ Under the interim version of the overnight business rule, the 
overnight service standard will be applied only to intra-SCF mail.\11\ 
It will no longer apply to any inter-SCF mail.\12\
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    \10\ The current overnight rule has an exception that excludes 
from overnight service some mail outside the contiguous forty-eight 
states, specifically: mail between Puerto Rico and the U.S. Virgin 
Islands; and mail originating and destinating in the Alaska 3-digit 
ZIP Codes 996, 997, 998, and 999, and in the Alaska 5-digit ZIP 
Codes 99540 to 99591.
    \11\ The new overnight rule will expand the exception described 
in footnote 10, id., to include American Samoa and the Alaska 5-
digit ZIP Codes 99592 to 99599. These ZIP Codes are currently 
unassigned, but they may be assigned in the future.
    \12\ Both the current and new rules use the terms ``intra-SCF'' 
and ``inter-SCF'' as they are defined in the Domestic Mail Manual 
(DMM). So, with respect to a particular SCF, intra-SCF mail is mail 
that originates and destinates within the 3-digit ZIP Code areas 
assigned to that SCF in the DMM, while inter-SCF mail is mail that 
originates or destinates outside those 3-digit ZIP Code areas.
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    Under the final version of the overnight business rule for First-
Class Mail, the overnight service standard will be applied only to 
intra-SCF Presort mail that is entered at the actual SCF. The overnight 
service standard will not apply to mail that is entered anywhere other 
than the designated SCF, nor will it apply to mail that does not meet 
all of the preparation requirements for Presort mail. Pursuant to these 
revisions, the overnight service standard for First-Class Mail will no 
longer apply to mail sent by retail customers, regardless of where they 
enter the mail.\13\
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    \13\ Some First-Class Mail pieces entered by retail customers 
may, under limited circumstances, continue to receive overnight 
service, but the applicable service standard will not be overnight.
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    On February 1, 2014, when the final version of the rule takes 
effect, the CET at the SCF will become 8 a.m., with a 12 p.m. exception 
that will be available only to intra-SCF Presort First-Class Mail that 
is sorted and containerized to the 5-digit ZIP Code or 5-digit scheme 
level.
2. Two-Day Rule
    Under the current two-day business rule for First-Class Mail, a 
two-day service standard is applied to mail pieces for which the 
driving time between the applicable P&DC/F and ADC is twelve hours or 
less. The interim version of the two-day business rule will revise this 
metric to six hours. The final version will revise it to six hours 
between the applicable P&DC/F and SCF.\14\
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    \14\ After the Phase Two consolidations, the Postal Service will 
be able to sort First-Class Mail at the origin to the SCF level, 
which is typically closer to the destination of the mail piece than 
the ADC level. Therefore, mail will generally bypass ADCs and be 
transported directly to SCFs. It is for this reason that the final 
version of the two-day business rule measures the driving time based 
on the destination SCF.
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3. Three-, Four-, and Five-Day Rules
    The current three-, four-, and five-day service standards for 
First-Class Mail will remain unchanged. All First-Class Mail that 
qualifies for a two-day service standard under the current two-day 
business rule, but does not qualify for a

[[Page 31195]]

two-day standard under the new rule, will qualify for a three-day 
standard.
4. First-Class Mail International
    The new domestic service standards for First-Class Mail 
International will mirror the new service standards for domestic First-
Class Mail, just as the current domestic service standards for First-
Class Mail International mirror the current service standards for 
domestic First-Class Mail.

C. Periodicals

    The Postal Service is changing the delivery day range for end-to-
end Periodicals mailed within the contiguous forty-eight states, from 
the current one to nine days, to two to nine days in the interim 
version of the new rules, and three to nine days in the final version. 
The Postal Service is also changing the delivery day range for end-to-
end Periodicals that originate or destinate outside the contiguous 
forty-eight states, from the current one to twenty days, to two to 
twenty-six days in the interim version, and three to twenty-six days in 
the final version.\15\
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    \15\ The proportion of mail affected by this change is less than 
one percent of total mail volume. The change is being made so that 
the rules more accurately reflect, and better inform customers of, 
the actual service that the Postal Service's network is presently 
capable of providing for such mail. Outside the contiguous forty-
eight states, mail is often dependent on transportation that does 
not run daily (e.g., some boat and air-taxi services used by the 
Postal Service operate only on certain days of the week). For this 
reason, the service accorded to such mail varies widely and is often 
longer than stated in the current service standards.
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    The Postal Service is changing the delivery day range for 
destination-entry Periodicals mailed within the contiguous forty-eight 
states, from the current one to two days, to one to three days in both 
the interim and final versions. The Postal Service is changing the 
delivery day range for destination-entry Periodicals that originate or 
destinate outside the contiguous forty-eight states, from the current 
one to seven days, to one to eleven days in both the interim and final 
versions.\16\
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    \16\ See id. for why this change is being made. The proportion 
of mail affected is less than one percent of total mail volume.
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    The changes to the Periodicals business rules are described below. 
There are separate business rules for end-to-end Periodicals and 
destination-entry Periodicals.
1. End-to-End Periodicals
    Under the current overnight business rule for end-to-end 
Periodicals, an overnight service standard applies to intra-SCF mail 
for which the origin P&DC/F and SCF are located in the same building. 
The new rules will not apply an overnight service standard to any end-
to-end Periodicals (though they will apply an overnight standard to 
qualifying destination-entry Periodicals, as described below).
    The current two- to four-day business rule covers most end-to-end 
Periodicals mail pieces that are mailed within the contiguous forty-
eight states and do not qualify for the overnight service standard.\17\ 
The rule calculates the specific standard for each such piece by adding 
one day to the comparable First-Class Mail service standard that the 
piece would qualify for if it were a First-Class Mail piece. The 
interim version of this rule will remain two to four days, but the 
final version will be three to four days, as a result of the reduced 
scope of the overnight First-Class Mail service standard.
---------------------------------------------------------------------------

    \17\ Mail pieces qualify for this rule based on whether they can 
be merged with First-Class Mail, as determined by criteria set forth 
in the DMM.
---------------------------------------------------------------------------

    The current five- to nine-day business rule covers end-to-end 
Periodicals mail pieces that are mailed within the contiguous forty-
eight states, do not qualify for the overnight service standard, and 
cannot be merged with First-Class Mail. This rule will be retained.
    The remaining business rules for end-to-end Periodicals cover mail 
pieces originating or destinating outside the contiguous forty-eight 
states. In the new business rules for these pieces, the current eight- 
to twenty-day service standard will become a twelve- to twenty-six day 
service standard, to more accurately reflect, and better inform 
customers of, the service that the Postal Service's network is 
presently capable of providing for mail outside the contiguous forty-
eight states. The other end-to-end service standards for these pieces 
will not change.
2. Destination-Entry Periodicals
    The new rules make three significant changes to the service 
standards for destination-entry Periodicals. First, they revise the 
overnight service standard to exclude Periodicals entered at Network 
Distribution Centers (NDCs) and Auxiliary Service Facilities (ASFs). 
This revision is being made to reflect the capabilities of the Postal 
Service's transportation network.
    Second, the new rules revise the seven-day service standard to an 
eleven-day service standard. And third, the new rules revise the five- 
to eight-day service standard to an eight- to eleven-day service 
standard. The second and third changes are being made so that the rules 
more accurately reflect, and better inform customers of, the service 
that the Postal Service's network is presently capable of providing.
    On February 1, 2014, the CETs for destination-entry Periodicals at 
facilities that do not employ the Flats Sequencing System (FSS) will 
change from 4 p.m. for mailings that require a bundle sort, and 5 p.m. 
for mailings that do not require a bundle sort, to 11 a.m. and 2 p.m., 
respectively. The CETs at FSS facilities will not change.

D. Standard Mail and Package Services

    The new rules do not revise the service standards for Standard Mail 
and Package Services pieces mailed within the contiguous forty-eight 
states. They do, however, revise service standards for pieces that 
originate or destinate outside the contiguous forty-eight states, to 
more accurately reflect the service that the Postal Service's network 
is presently capable of providing.\18\ The new rules revise Standard 
Mail's maximum delivery expectation from the current twenty-two days to 
twenty-seven days. Within the business rules, they revise the end-to-
end nine- to twenty-two-day service standard to twelve to twenty-seven 
days, and the destination-entry nine- to twelve-day service standard to 
twelve to fourteen days.
---------------------------------------------------------------------------

    \18\ The proportion of mail affected by these changes is less 
than one percent of total mail volume.
---------------------------------------------------------------------------

    Likewise, the new rules revise Package Services' maximum delivery 
expectation from the current twenty days to twenty-six days. Within the 
business rules, they revise the end-to-end seven- to twenty-day service 
standard to ten to twenty-six days, and the destination-entry seven- to 
eight-day service standard to eleven to twelve days.

E. Non-Substantive Changes

    Apart from the substantive changes explained above, the Postal 
Service has also reworded and reorganized portions of rules, 
particularly the First-Class Mail and Periodicals sections, in a manner 
that does not change the substantive effects of the rules but will, the 
Postal Service hopes, make the rules clearer and easier to understand.

List of Subjects in 39 CFR Part 121

    Administrative practice and procedure, Postal Service.

    Accordingly, for the reasons stated, the Postal Service adopts the 
following revisions to 39 CFR Part 121:

[[Page 31196]]

PART 121--SERVICE STANDARDS FOR MARKET DOMINANT MAIL PRODUCTS

0
1. The authority citation for 39 CFR Part 121 continues to read as 
follows:

    Authority: 39 U.S.C. 101, 401, 403, 404, 1001, 3691.


0
2. Section 121.1 is revised to read as follows:


Sec.  121.1  First-Class Mail.

    (a)(1) Until February 1, 2014, a 1-day (overnight) service standard 
is applied to intra-Sectional Center Facility (SCF) domestic First-
Class Mail[supreg] pieces properly accepted before the day-zero 
Critical Entry Time (CET), except for mail between Puerto Rico and the 
U.S. Virgin Islands, mail between American Samoa and Hawaii, and mail 
destined to the following 3-digit ZIP Code areas in Alaska (or 
designated portions thereof): 995 (5-digit ZIP Codes 99540 through 
99599), 996, 997, 998, and 999.
    (2) On and after February 1, 2014, a 1-day (overnight) service 
standard is applied to intra-SCF domestic Presort First-Class Mail 
pieces properly accepted at the SCF before the day-zero CET, except for 
mail between Puerto Rico and the U.S. Virgin Islands, and mail destined 
to American Samoa and the following 3-digit ZIP Code areas in Alaska 
(or designated portions thereof): 995 (5-digit ZIP Codes 99540 through 
99599), 996, 997, 998, and 999.
    (b)(1) Until February 1, 2014, a 2-day service standard is applied 
to inter-SCF domestic First-Class Mail pieces properly accepted before 
the day-zero CET if the drive time between the origin Processing & 
Distribution Center or Facility (P&DC/F) and destination Area 
Distribution Center (ADC) is 6 hours or less; or if the origin and 
destination are separately in Puerto Rico and the U.S. Virgin Islands; 
or if the origin or destination is in American Samoa or one of the 
following 3-digit ZIP Code areas in Alaska (or designated portions 
thereof): 995 (5-digit ZIP Codes 99540 through 99599), 996, 997, 998, 
and 999.
    (2) On and after February 1, 2014, a 2-day service standard is 
applied to inter-SCF domestic First-Class Mail pieces properly accepted 
before the day-zero CET if the drive time between the origin P&DC/F and 
destination SCF is 6 hours or less; or if the origin and destination 
are separately in Puerto Rico and the U.S. Virgin Islands; or if the 
origin or destination is in American Samoa or one of the following 3-
digit ZIP Code areas in Alaska (or designated portions thereof): 995 
(5-digit ZIP Codes 99540 through 99599), 996, 997, 998, and 999.
    (c) A 3-day service standard is applied to domestic First-Class 
Mail pieces properly accepted before the day-zero CET, if the 1-day and 
2-day service standards do not apply, and:
    (1) Both the origin and the destination are within the contiguous 
48 states;
    (2) The origin is in the contiguous 48 states, and the destination 
is in any of the following: the city of Anchorage, Alaska (5-digit ZIP 
Codes 99501 through 99539); the 968 3-digit ZIP Code area in Hawaii; or 
the 006, 007, or 009 3-digit ZIP Code areas in Puerto Rico;
    (3) The origin is in the 006, 007, or 009 3-digit ZIP Code areas in 
Puerto Rico, and the destination is in the contiguous 48 states;
    (4) The origin is in Hawaii, and the destination is in Guam, or 
vice versa;
    (5) The origin is in Hawaii, and the destination is in American 
Samoa, or vice versa; or
    (6) Both the origin and destination are within Alaska.
    (d) A 4-day service standard is applied to domestic First-Class 
Mail pieces properly accepted before the day-zero CET, if the 1-day, 2-
day, and 3-day service standards do not apply, and:
    (1) The origin is in the contiguous 48 states and the destination 
is in any of the following: any portion of Alaska other than the city 
of Anchorage (5-digit ZIP Codes 99501 through 99539); any portion of 
Hawaii other than the 968 3-digit ZIP Code area; or the U.S. Virgin 
Islands;
    (2) The destination is in the contiguous 48 states and the origin 
is in Alaska, Hawaii, or the U.S. Virgin Islands; or
    (3) The origin and destination are in different non-contiguous 
states or territories, excluding mail to and from Guam and mail between 
Puerto Rico and the U.S. Virgin Islands.
    (e) A 5-day service standard is applied to all remaining domestic 
First-Class Mail pieces properly accepted before the day-zero CET.
    (f) The service standard for Outbound Single-Piece First-Class Mail 
InternationalTM; pieces properly accepted before the day-
zero CET is equivalent to the service standard for domestic First-Class 
Mail pieces originating from the same 3-digit ZIP Code area and 
destined to the 3-digit ZIP Code area in which the designated 
International Service Center is located.
    (g) The service standard for Inbound Single-Piece First-Class Mail 
International pieces properly accepted before the day-zero CET is 
equivalent to the service standard for domestic First-Class Mail pieces 
destined to the same 3-digit ZIP Code area and originating from the 3-
digit ZIP Code area in which the designated International Service 
Center is located.


0
3. Section 121.2 is revised to read as follows:


Sec.  121.2  Periodicals.

    (a) End-to-End.
    (1)(i) Until February 1, 2014, a 2- to 4-day service standard is 
applied to Periodicals pieces properly accepted before the day-zero 
Critical Entry Time (CET) and merged with First-Class Mail pieces for 
surface transportation (as per the Domestic Mail Manual (DMM)), with 
the standard specifically equaling the sum of 1 day plus the applicable 
First-Class Mail service standard;
    (ii) On and after February 1, 2014, a 3- to 4-day service standard 
is applied to Periodicals pieces properly accepted before the day-zero 
CET and merged with First-Class Mail pieces for surface transportation 
(as per the DMM), with the standard specifically equaling the sum of 1 
day plus the applicable First-Class Mail service standard.
    (2) A 3-day service standard is applied to Periodicals pieces 
properly accepted before the day-zero CET if: the origin and 
destination are separately in Puerto Rico and the U.S. Virgin Islands; 
or if the origin is in Alaska, the service standards set forth in 
paragraphs (a)(1)(i) and (ii) do not apply, and the destination is in 
the following 3-digit ZIP Code areas in Alaska (or designated portions 
thereof): 995 (5-digit ZIP Codes 99540 through 99599), 996, 997, 998, 
and 999.
    (3) A 4-day service standard is applied to Periodicals pieces 
properly accepted before the day-zero CET if: the origin and 
destination are separately in Hawaii and Guam; or the origin and 
destination are separately in Hawaii and American Samoa.
    (4)(i) A 5- to 8-day service standard is applied to Periodicals 
pieces properly accepted before the day-zero CET if they originate and 
destinate within the contiguous 48 states, they are not merged with 
First-Class Mail pieces for surface transportation (as per the DMM), 
and the Area Distribution Center (ADC) and Sectional Center Facility 
(SCF) are co-located, with the standard specifically equaling the sum 
of 4 days plus the number of additional days (from 1 to 4) required for 
surface transportation between the applicable 3-digit ZIP Code origin-
destination pairs;
    (ii) A 6- to 9-day service standard is applied to Periodicals 
pieces properly accepted before the day-zero CET if they originate and 
destinate within the contiguous 48 states, they are not merged with 
First-Class Mail pieces for surface transportation (as per the DMM),

[[Page 31197]]

and the ADC and SCF are not co-located, with the standard specifically 
equaling the sum of 5 days plus the number of additional days (from 1 
to 4) required for surface transportation between the applicable 3-
digit ZIP Code origin-destination pairs;
    (5) A 12- to 26-day service standard is applied to all remaining 
Periodicals pieces properly accepted before the day-zero CET, with the 
standard specifically equaling the sum of 5 days plus the number of 
additional days (from 7 to 21) required for intermodal (highway, boat, 
air-taxi) transportation outside the contiguous 48 states for the 
applicable 3-digit ZIP Code origin-destination pairs.
    (b) Destination Entry.
    (1) Destination Delivery Unit (DDU) Entered Mail. A 1-day 
(overnight) service standard is applied to Periodicals pieces that 
qualify for a DDU rate and are properly accepted before the day-zero 
CET at the designated DDU.
    (2) Destination Sectional Center Facility (DSCF) Entered Mail.
    (i) A 1-day (overnight) service standard is applied to Periodicals 
pieces that qualify for a DSCF rate and are properly accepted before 
the day-zero CET at the designated DSCF, except for mail entered at the 
SCF in Puerto Rico and destined to the U.S. Virgin Islands, mail 
entered at the SCF in Hawaii and destined to American Samoa, and mail 
destined to the following 3-digit ZIP Code areas in Alaska (or 
designated portions thereof): 995 (5-digit ZIP Codes 99540 through 
99599), 996, 997, 998, and 999;
    (ii) A 3-day service standard is applied to Periodicals pieces that 
qualify for a DSCF rate and are properly accepted before the day-zero 
CET at the designated DSCF, if the they are entered at the DSCF in 
Puerto Rico and destined to the U.S. Virgin Islands, entered at the 
DSCF in Hawaii and destined to American Samoa, or destined to the 
following 3-digit ZIP Code areas in Alaska (or designated portions 
thereof): 995 (5-digit ZIP Codes 99540 through 99599), 996, 997, 998, 
and 999.
    (3) Destination Area Distribution Center (DADC) Entered Mail.
    (i) A 1-day (overnight) service standard is applied to Periodicals 
pieces that qualify for a DADC rate and are properly accepted before 
the day-zero CET at the designated DADC, if the DADC and DSCF are co-
located;
    (ii) A 2-day service standard is applied to Periodicals pieces that 
qualify for a DADC rate and are properly accepted before the day-zero 
CET at the designated DADC, if the DADC and DSCF are not co-located, 
unless the mail is entered at a DADC within the contiguous 48 states 
and destined outside the contiguous 48 states, or entered at the DADC 
in Puerto Rico and destined to the U.S. Virgin Islands, or destined to 
either American Samoa or the following 3-digit ZIP Code areas in Alaska 
(or designated portions thereof): 995 (5-digit ZIP Codes 99540 through 
99599), 996, 997, 998, and 999;
    (iii) A 4-day service standard is applied to Periodicals pieces 
that qualify for a DADC rate and are properly accepted before the day-
zero CET at the designated DADC, if they are entered at the DADC in 
Puerto Rico and destined to the U.S. Virgin Islands, or if they are 
destined to American Samoa or the following 3-digit ZIP Code areas in 
Alaska (or designated portions thereof): 995 (5-digit ZIP Codes 99540 
through 99599), 996, 997, 998, and 999;
    (iv) An 11-day service standard is applied to Periodicals pieces 
that qualify for a DADC rate, are properly accepted before the day-zero 
CET at the designated DADC in the contiguous 48 states, and are 
destined to the 998 or 999 3-digit ZIP Code areas in Alaska.
    (4) Destination Network Distribution Center (DNDC)/Auxiliary 
Service Facility (ASF) Entered Mail.
    (i) A 2-day service standard is applied to Periodicals pieces that 
qualify for a DADC containerized rate, are properly accepted before the 
day-zero CET at the designated DNDC or ASF in the contiguous 48 states, 
and are destined within the contiguous 48 states, if the DADC and DSCF 
are co-located;
    (ii) A 3-day service standard is applied to Periodicals pieces that 
qualify for a DADC containerized rate, are properly accepted before the 
day-zero CET at the designated DNDC or ASF in the contiguous 48 states, 
and are destined within the contiguous 48 states, if the DADC and DSCF 
are not co-located;
    (iii) An 8- to 10-day service standard is applied to Periodicals 
pieces that qualify for a DADC containerized rate, are properly 
accepted before the day-zero CET at the designated DNDC or ASF in the 
contiguous 48 states, and are destined outside the contiguous 48 
states, if the DADC and DSCF are co-located, with the specific standard 
being based on the number of days required for transportation outside 
the contiguous 48 states;
    (iv) A 9- to 11-day service standard is applied to Periodicals 
pieces that qualify for a DADC containerized rate, are properly 
accepted before the day-zero CET at the designated DNDC or ASF in the 
contiguous 48 states, and are destined outside the contiguous 48 
states, if the DADC and DSCF are not co-located, with the specific 
standard being based on the number of days required for transportation 
outside the contiguous 48 states.


0
4. Section 121.3 is revised to read as follows:


Sec.  121.3  Standard Mail.

    (a) End-to-End. (1) The service standard for Sectional Center 
Facility (SCF) turnaround Standard Mail[supreg] pieces accepted at 
origin before the day-zero Critical Entry Time is 3 days when the 
origin Processing & Distribution Center/Facility (OPD&C/F) and the SCF 
are the same building, except for mail between the territories of 
Puerto Rico and the U.S. Virgin Islands.
    (2) The service standard for Area Distribution Center (ADC) 
turnaround Standard Mail pieces accepted at origin before the day-zero 
Critical Entry Time is 4 days when the OPD&C/F and the ADC are the same 
building, unless the ADC is in the contiguous 48 states and the 
delivery address is not, or the mail is between Puerto Rico and the 
U.S. Virgin Islands, or the mail is between Hawaii and American Samoa.
    (3) The service standard for intra-Network Distribution Center 
(NDC) Standard Mail pieces accepted at origin before the day-zero 
Critical Entry Time is 5 days for each remaining 3-digit ZIP Code 
origin-destination pair within the same Network Distribution Center 
service area if the origin and destination are within the contiguous 48 
states; the same standard applies to mail that is intra-Alaska or 
between the state of Hawaii and the territory of Guam or American 
Samoa.
    (4) For each remaining 3-digit ZIP Code origin-destination pair 
within the contiguous 48 states, the service standard for Standard Mail 
pieces accepted at origin before the day-zero Critical Entry Time is 
the sum of 5 or 6 days plus the number of additional days (from 1 to 4) 
required for surface transportation between each 3-digit ZIP Code 
origin-destination pair.
    (5) For each remaining 3-digit ZIP Code origin-destination pair, 
the service standard for Standard Mail pieces accepted at origin before 
the day-zero Critical Entry Time is the sum of 5 or 6 days plus the 
number of additional days (from 7 to 21) required for intermodal 
(highway, boat, air-taxi) transportation outside the contiguous 48 
states for each 3-digit ZIP Code origin-destination pair.
    (b) Destination Entry. (1) Standard Mail pieces that qualify for a 
Destination Delivery Unit (DDU) rate and that are accepted before the 
day-

[[Page 31198]]

zero Critical Entry Time at the proper DDU have a 2-day service 
standard.
    (2) Standard Mail pieces that qualify for a Destination Sectional 
Center Facility (DSCF) rate and that are accepted before the day-zero 
Critical Entry Time at the proper DSCF have a 3-day service standard, 
except for mail dropped at the SCF in the territory of Puerto Rico and 
destined to the territory of the U.S. Virgin Islands, or mail destined 
to American Samoa.
    (3) Standard Mail pieces that qualify for a Destination Sectional 
Center Facility (DSCF) rate, are accepted before the day-zero Critical 
Entry Time at the SCF, and are either entered in Puerto Rico and 
destined to the U.S. Virgin Islands, or are destined to American Samoa, 
have a 4-day service standard.
    (4) Standard Mail pieces that qualify for a Destination Network 
Distribution Center (DNDC) rate, and that are accepted before the day-
zero Critical Entry Time at the proper DNDC have a 5-day service 
standard, if both the origin and the destination are in the contiguous 
48 states.
    (5) Standard Mail pieces that qualify for a Destination Network 
Distribution Center (DNDC) rate, and that are accepted before the day-
zero Critical Entry Time at the proper DNDC in the contiguous 48 states 
for delivery to addresses in the states of Alaska or Hawaii or the 
territories of Guam, American Samoa, Puerto Rico, or the U.S. Virgin 
Islands, have a service standard of 12-14 days, depending on the 3-
digit origin-destination ZIP Code pair. For each such pair, the 
applicable day within the range is based on the number of days required 
for transportation outside the contiguous 48 states.


0
5. Section 121.4 is revised to read as follows:


Sec.  121.4  Package Services.

    (a) End-to-End. (1) The service standard for Sectional Center 
Facility (SCF) turnaround Package Services mail accepted at the origin 
SCF before the day-zero Critical Entry Time is 2 days when the origin 
Processing & Distribution Center/Facility and the SCF are the same 
building, except for mail between the territories of Puerto Rico and 
the U.S. Virgin Islands, and mail destined to American Samoa.
    (2) The service standard for intra-Network Distribution Center 
(NDC) Package Services mail accepted at origin before the day-zero 
Critical Entry Time is 3 days, for each remaining (non-intra-SCF) 3-
digit ZIP Code origin-destination pair within a Network Distribution 
Center service area, where the origin and destination is within the 
contiguous 48 states and is not served by an Auxiliary Service 
Facility; and for mail between the territories of Puerto Rico and the 
U.S. Virgin Islands, and for mail destined to American Samoa.
    (3) The service standard for intra-Network Distribution Center 
(NDC) Package Services mail accepted at origin before the day-zero 
Critical Entry Time is 4 days for each remaining 3-digit ZIP Code 
origin-destination pair within a Network Distribution Center service 
area, where the destination delivery address is served by an Auxiliary 
Service Facility; the same standard applies to all remaining intra-
Alaska mail and mail between the state of Hawaii and the territory of 
Guam, and mail destined to American Samoa.
    (4) For each remaining 3-digit ZIP Code origin-destination pair 
within the contiguous 48 states, the service standard for Package 
Services mail accepted at origin before the day-zero Critical Entry 
Time is between 5 and 8 days. For each such 3-digit ZIP Code origin-
destination pair, this is the sum of 4 days, plus the number of 
additional days (from 1 to 4) required for surface transportation 
between each 3-digit ZIP Code origin-destination pair, plus an 
additional day if the destination delivery address is served by an 
Auxiliary Service Facility.
    (5) For each remaining 3-digit ZIP Code origin-destination pair for 
which either the origin or the destination is outside the contiguous 48 
states, the service standard for Package Services mail accepted at 
origin before the day-zero Critical Entry Time is between 10 and 26 
days. For each such 3-digit ZIP Code origin-destination pair, this 
represents the sum of 3 to 4 days, plus the number of days (ranging 
from 7 to 22) required for intermodal (highway, boat, air-taxi) 
transportation between each 3-digit ZIP Code origin-destination pair.
    (6) The service standard for Inbound Surface Parcel Post[supreg] 
pieces (subject to Universal Postal Union rates) is the same as the 
service standard for domestic Package Services mail from the 3-digit 
ZIP Code area in which the International Network Distribution Center is 
located in the 3-digit ZIP Code in which the delivery address is 
located.
    (b) Destination Entry. (1) Package Services mail that qualifies for 
a Destination Delivery Unit (DDU) rate, and that is accepted before the 
day-zero Critical Entry Time at the proper DDU, has a 1-day (overnight) 
service standard.
    (2) Package Services mail that qualifies for a Destination 
Sectional Center Facility (DSCF) rate, and that is accepted before the 
day-zero Critical Entry Time at the proper DSCF, has a 2-day service 
standard, except for mail dropped at the SCF in the territory of Puerto 
Rico and destined to the territory of the U.S. Virgin Islands, and mail 
destined to American Samoa.
    (3) Package Services mail that qualifies for a Destination 
Sectional Center Facility (DSCF) discount, is accepted before the day-
zero Critical Entry Time at the SCF, and is destined to either American 
Samoa or the U.S. Virgin Islands, has a 3-day service standard.
    (4) Package Services mail that qualifies for a Destination Network 
Distribution Center (DNDC) rate, and is accepted before the day-zero 
Critical Entry Time at the proper DNDC or Destination Auxiliary Service 
Facility, and originates and destinates in the contiguous 48 states, 
has a 3-day service standard.
    (5) Package Services mail that qualifies for a Destination Network 
Distribution Center (DNDC) rate, and that is accepted before the day-
zero Critical Entry Time at the proper DNDC in the contiguous 48 states 
for delivery to addresses in the states of Alaska or Hawaii, or the 
territories of Guam, American Samoa, Puerto Rico, or the U.S. Virgin 
Islands has a service standard of either 11 or 12 days, depending on 
the 3-digit ZIP Code origin-destination pair. For each such pair, the 
applicable day within the range is based on the number of days required 
for transportation outside the contiguous 48 states.


0
6. The Appendix to Part 121 is revised to read as follows:

Appendix A to Part 121--Tables Depicting Service Standard Day Ranges

    The following tables reflect the service standard day ranges 
resulting from the application of the business rules applicable to 
the market-dominant mail products referenced in Sec. Sec.  121.1 
through 121.4:

[[Page 31199]]

    Table 1. Prior to February 1, 2014, end-to-end service standard 
day ranges for mail originating and destinating within the 
contiguous 48 states and the District of Columbia.

                        Contiguous United States
------------------------------------------------------------------------
                                                              End-to-end
                         Mail class                             range
                                                                (days)
------------------------------------------------------------------------
First-Class Mail...........................................          1-3
Periodicals................................................          2-9
Standard Mail..............................................         3-10
Package Services...........................................          2-8
------------------------------------------------------------------------

    Table 2. On and after February 1, 2014, end-to-end service 
standard day ranges for mail originating and destinating within the 
contiguous 48 states and the District of Columbia.

                        Contiguous United States
------------------------------------------------------------------------
                                                              End-to-end
                         Mail class                             range
                                                                (days)
------------------------------------------------------------------------
First-Class Mail...........................................          1-3
Periodicals................................................          3-9
Standard Mail..............................................         3-10
Package Services...........................................          2-8
------------------------------------------------------------------------

    Table 3. Prior to February 1, 2014, end-to-end service standard 
day ranges for mail originating and/or destinating in non-contiguous 
states and territories.

                                                          Non-Contiguous States and Territories
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                          End-to-end
                                    --------------------------------------------------------------------------------------------------------------------
                                             Intra state/territory               To/From contiguous 48 states       To/From states of Alaska and Hawaii,
                                    ------------------------------------------------------------------------------  and the territories of Guam, Puerto
                                                                                                                      Rico and the U.S. Virgin Islands
             Mail class                             Hawaii,                                Hawaii,                --------------------------------------
                                                    Guam, &    Puerto Rico                 Guam, &    Puerto Rico                 Hawaii,
                                        Alaska      American      & USVI       Alaska      American      & USVI                   Guam, &    Puerto Rico
                                                     Samoa                                  Samoa                     Alaska      American      & USVI
                                                                                                                                   Samoa
--------------------------------------------------------------------------------------------------------------------------------------------------------
First-Class Mail...................          1-3          1-3          1-2          3-4          3-5          3-4          4-5          4-5          4-5
Periodicals........................          2-4          2-4          2-3        13-19        12-22        11-16        21-25        21-26        23-26
Standard Mail......................          3-5          3-5          3-4        14-20        13-23        12-17        23-26        23-27        24-27
Package Services...................        * 2-4          2-4          2-3        12-18        11-21        10-15        21-26        20-26        20-24
--------------------------------------------------------------------------------------------------------------------------------------------------------
* Excluding bypass mail.

    Table 4. On and after February 1, 2014, end-to-end service 
standard day ranges for mail originating and/or destinating in non-
contiguous states and territories.

                                                          Non-Contiguous States and Territories
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                          End-to-end
                                    --------------------------------------------------------------------------------------------------------------------
                                             Intra state/territory               To/From contiguous 48 states       To/From states of Alaska and Hawaii,
                                    ------------------------------------------------------------------------------  and the Territories of Guam, Puerto
                                                                                                                      Rico and the U.S. Virgin Islands
             Mail class                             Hawaii,                                Hawaii,                --------------------------------------
                                                    Guam, &    Puerto Rico                 Guam, &    Puerto Rico                 Hawaii,
                                        Alaska      American      & USVI       Alaska      American      & USVI                   Guam, &    Puerto Rico
                                                     Samoa                                  Samoa                     Alaska      American      & USVI
                                                                                                                                   Samoa
--------------------------------------------------------------------------------------------------------------------------------------------------------
First-Class Mail...................          1-3          1-3          1-2          3-4          3-5          3-4          4-5          4-5          4-5
Periodicals........................          3-4          3-4            3        13-19        12-22        11-16        21-25        21-26        23-26
Standard Mail......................          3-5          3-5          3-4        14-20        13-23        12-17        23-26        23-27        24-27
Package Services...................        * 2-4          2-4          2-3        12-18        11-21        10-15        21-26        20-26        20-24
--------------------------------------------------------------------------------------------------------------------------------------------------------
* Excluding bypass mail.

    Table 5. Destination-entry service standard day ranges for mail 
to the contiguous 48 states and the District of Columbia.

[[Page 31200]]



                                            Contiguous United States
----------------------------------------------------------------------------------------------------------------
                                                                  Destination entry (at appropriate facility)
                                                             ---------------------------------------------------
                         Mail class                                                                    NDC/ASF
                                                               DDU (days)   SCF (days)   ADC (days)     (days)
----------------------------------------------------------------------------------------------------------------
Periodicals.................................................            1            1          1-2          2-3
Standard Mail...............................................            2            3  ...........            5
Package Services............................................            1            2  ...........            3
----------------------------------------------------------------------------------------------------------------

    Table 6. Destination entry service standard day ranges for mail 
to non-contiguous states and territories.

                                                          Non-Contiguous States and Territories
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                   Destination Entry (at appropriate facility)
                                                       -------------------------------------------------------------------------------------------------
                                                                          SCF (Days)                    ADC (Days)                    NDC (Days)
                                                                ----------------------------------------------------------------------------------------
                      Mail class                          DDU              Hawaii,                        Hawaii,                      Hawaii,
                                                         (Days)            Guam, &    Puerto              Guam, &    Puerto            Guam, &    Puerto
                                                                  Alaska   American   Rico &    Alaska    American   Rico &   Alaska   American   Rico &
                                                                            Samoa      USVI                Samoa      USVI              Samoa      USVI
--------------------------------------------------------------------------------------------------------------------------------------------------------
Periodicals...........................................        1      1-3          1      1-3   1-4 (AK)   1 (HI) 2      1-4    10-11         10     8-10
                                                                                               11 (JNU)       (GU)
                                                                                               11 (KTN)
Standard Mail.........................................        2        3        3-4      3-4  .........  .........  .......       14         13       12
Package Services......................................        1        2        2-3      2-3  .........  .........  .......       12         11       11
--------------------------------------------------------------------------------------------------------------------------------------------------------
AK = Alaska 3-digit ZIP Codes 995-997; JNU = Juneau AK 3-digit ZIP Code 998; KTN = Ketchikan AK 3-digit ZIP Code 999; HI = Hawaii 3-digit ZIP Codes 967
  and 968; GU = Guam 3-digit ZIP Code 969.


Stanley F. Mires,
Attorney, Legal Policy & Legislative Advice.
[FR Doc. 2012-12564 Filed 5-24-12; 8:45 am]
BILLING CODE 7710-12-P