Dan G. Blair Chairman Postal Regulatory Commission

2007 in Review  Issued Opinion and Recommended Decision on Postal Rate and Fee Changes (last omnibus rate case)  Completed and issued Ratemaking Regulations – 8 months ahead of statutory deadline  Consultation with the Service to develop modern service standards for all market dominant products

Where we stand for 2008  Issued the first Annual Compliance Determination of the U.S. Postal Service Performance for Fiscal Year 2007  Revenue was up, volume was down  Our Findings found that five market dominant postal services did not cover their attributable costs  Annual Compliance Determination available at ww.prc.gov  Price Adjustment Filing for Market Dominant  Filing occurred in February  March 3 rd to submit comments  March 17 th increases on average are within the 2.9% CAP

Where we stand for 2008  Development of accounting principles and methods to calculate “assumed” Federal income tax on competitive products  Negotiated Service Agreements  Update on the Report to Congress on Universal Postal Service and the Postal Monopoly (sect. 702 of the PAEA)

Service Standard & Performance Measurement  Future path of consultation with Postal Service  Link Network Realignment to Service Standards  Goals due at the end of June  IMB  Interim Measurement

Looking Ahead  Coordinate with the Department of State on international postal policy and provide views on international treaties affecting postal rates and classifications  Periodic Reporting Rules  Complaint Rules  Periodical Study  Nonpostal Services – MC  FSS