4. Discussion

The need for revision of the existing MAX 4 distance and hourly rate boundaries is clear from the record in this proceeding. Changing demographics have resulted in urbanization and higher costs in some geographical areas since the present boundaries were established, and the Commission has not reexamined the underlying data for many years. Declining to make appropriate adjustments would be damaging to carriers' financial health in certain regions, and could redound to the detriment of consumers who require their services.

The revisions agreed upon by DRA and CMSA will resolve the current problems with the MAX 4 tariff. They are rationally designed to correct the problems with the present framework without making major changes to the entire MAX 4 tariff structure. These changes will not harm consumers, because only rate caps will be adjusted, without intruding upon the competitive marketplace. As we found long ago, the used household goods industry is fundamentally competitive. Re Regulation of Used Household Goods Industry by Truck (1990) 38 CPUC 2d 559, 586. It is characterized by relative ease of entry and high sensitivity to price competition, and carriers that consistently price their services higher than their competitors quickly become vulnerable to failure. Consequently, the Commission's larger task is to monitor companies' compliance with consumer protection rules to ensure that price-cutting does not negate pricing requirements and become destructive to consumers' interests.

As CMSA contends, adoption of the suggested changes would make MAX 4 more comprehensible to consumers and easier to use. However, we doubt that the vast majority of consumers ever try to use this intricate and complex document, so the inquiry does not end there. The more important question is whether consumer protection would be enhanced by reason of the simplified content, and we find that it would. Adoption of simplified terms in the tariff would make the price caps easier for Commission staff to administer and enforce. This would be true at every stage, from advising consumers to disciplining carriers for violations. By extension, tariff simplification would make it easier to develop tools for the consumer, such as website content enabling consumers to obtain and evaluate estimated moving costs online. In addition, adoption of the proposed changes would eliminate the current productivity offset factor anomalies, and better promote the efficiency and productivity of moving companies in the state without making any change to the existing incentive mechanism.

In recognition of the existence of universal support for the proposed changes, we will adopt the changes to MAX 4 that have been proposed jointly by CMSA and DRA, but implementation of the changes will be subject to the preparation and issuance of an appropriate resolution by CPSD.