United States f A0 General Accounting Washington, Office D.C. 20548 National Security and International AfTairs Division B-282505 April 15, 1999 The Honorable Herbert W. Bateman Chairman The Honorable Solomon P. Ortiz Ranking Minority Member Subcommittee on Readiness Committee on Armed Services House of Representatives Subject: Defense Transnortation: DOD and GSA Personal Prone&v Programs Following the March l&1999, hearing before your Subcommittee on the Department of Defense’s (DOD) personal property program, you asked us to provide information on the General Services Administration (GSA) and DOD personal property programs. This letter and the enclosure provide the information we gathered on the agencies’ current programs. It should be noted, however, that both agencies are currently in the process of reengineering their personal properly programs. We noted differences in the scope and management between the DOD and GSA personal property programs. GSA is responsible for moving between 12,000 and 15,000 government employees a year, whereas DOD handles approximately 775,000 service member moves annually. GSA deals with far fewer household goods carriers (about 330) compared with DOD (1,300 carriers). Each government agency has the option of selecting one or more carriers from a list of approved GSA carriers, while DOD makes an effort to equally distribu te service member moves among its approved carriers. Another important difference is that DOD allows a second phase in the process, in which carriers are permitted to change previously offered rates to match those of the carriers offering the lowest rates. We discussed the programs with officials responsible for managing the personal property programs at each agency and obtained information from a variety of available sources. We provided a draft of the enclosure to officials from DOD and GSA for their review and cqmments. The officials generally agreed with the information discussed in the enclosure. We conducted our review in accordance with generally accepted government auditing standards. /452~(53 GAO/NSIAD-QQ-139R Personal Property Programs Major contributors to this letter were Nomi R. Taslitt, John R. Beauchamp, and Jacqueline E. Snead. Please contact me at (202) 512-8412 if you or your staff have any questions. . David R. Warren, Director DefenSe Management Issues Enclosure Page 2 GAOI’NSIAD-~Q-139RPersonal Property Programs ENCLOSURE ENCLOSURE Department of Defense and General Services Administration Personal Property Programs ___ .,......... ;“..;“: ,.“’ r. .,,; . . . . ~;;: . . . . . ~. . . . . . . . . . . . . ~;..~:‘c”‘u..,..~~ . ‘“‘:f’ :.:.:.:.:.:.~.:.:.~:.:.:~~:~~,~~~:~~~~~.:.:.:.......:;.~...~ .......... .;.;‘ . . . . . . .A . c ,..............,...-. ,. .I , ,. , . . h . ..,.,. 9,. . ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ :+x.:.:.:-A.. ,,.. Legal authority 49 U.S. Code 13712and DOD 49 U.S. Code 13712 and GSA implementing regulations. implementing regulations. Annual moves 775,000 service members. 12,000-15,000 civilians. Industry involvement: 1,300 carriers and forwarders: Over 330 carriers, forwarders,and prime contractorswith DOD relocation companies. andGSA (A) Papercompanies(B) Carrier approval processdoesnot Carrier approval processgenerally exclude paper companies. excludespaper companies. Traffic distribution/carrier Traffic managersequally No requirement for equal traffic performance(C) distribute traffic. Selection is distribution. Agencies may select one basedon a minimal acceptable or more carriers from GSA’s list of level of quality with the lowest both quality indexed and non-indexed rates receiving preference. carriers. Point to point move No. Yes, if requestedby agency. management Quality assurance Inspections required. Personal Inspections optional. GSA primarily procedures property offices perform relies on carrier approval processand inspections to the extent that customersurveys’ effect on carrier personnel are available. selection and scopeof operationsto assurequality. Small businessimpact No set-asides. No set-asides. (prime contractorswith DOD andGSA) Ratecycle Semi-annual rate filing; two- Annual rate filing with a mid-year phasebid processgives carriers supplementalfiling; single phasebid opportunity to match rate. process,no opportunity to match lowest rate. Weight allowances Rank dependent,ranging from 18,000pounds for all personnel. 5,000 to 18,000 pounds. Customersatisfaction(D) DOD does not solicit or consider GSA usescustomer satisfaction customer satisfaction surveys. surveysto evaluate carrier Local personal property offices performanceand assurequality. do quality scoring. Claims process Indirect: customer submits ~Direct: customer,deaJsdirectly with completed government claim ~carrier to settle claim (in casesof form with Judge Advocate impasse,GSA will offer General’s Office for resolution. recommendations). Coveragelimitations Q Coveragefor depreciatedvalue is Full replacement. capped at $40,000. Relocation service DOD does not provide relocation Agencies can contract for relocation assistance service assistance. servicesincluding guaranteedhome saleprogram home-finding assistance, andreimbursement for sale/purchase/ property managementexpenses. Page 3 GAOMSJAD-99-139RPersonal Proper@ Programs ENCLOSURE ENCLOSURE (A) Industry Involvement DOD’s personal property program is run centrally by the headquarters office of the Military Traffic Management Command (MTMC) but administered locally at about 200 military and DOD transportation offices around the world. DOD works directly with approximately 1,300 moving van companies (carriers) and forwarders, and indirectly with thousands of agents and . owner-operator truckers working for the carriers and forwarders. GSA’s Centralized Household Goods Traffic Management Program is run centrally by its Kansas City Regional Office, which offers operational assistance to federal agencies that use the moving services. GSA works directly with 332 moving van companies (carriers), forwarders, and relocation companies and indirectly with hundreds of agents and owner- operator truckers working for the carriers, forwarders, and relocation companies. (B) Paper Companies Carriers or freight forwarders desiring to participate in the MTMC program must provide proof or certification that they have requisite operational authority and must agree to abide by MTMC’s Tender of Service. The carrier approval process does not exclude “paper companies,” affiliates of larger or parent companies whose purpose is to increase shares in traffic, but do not offer additional transportation capacity. Under the GSA program, any carrier or freight forwarder having requisite operating authority (certificates, licenses, or permits, as appropriate) must submit a written request to participate and must agree to abide by the terms and conditions of GSA’s Tender of Service. The carrier or freight forwarder must also demonstrate its financial responsibility, working capital, and other financial, technical, and management resources to participate in the program. The GSA carrier approval process generally excludes “paper companies” from participating. (C) Traffic Distribution Each local military installation uses a traffic distribution roster. Carriers and forwarders are placed on the roster for each channel by order of rate level and quality score. Traffic managers equally distribute traffic based on a minimal acceptable level of quality with the lowest rates receiving preference. GSA does not have a requirement for equal traffic distribution. Agencies may select one or more carriers from a listing that identifies both “quality indexed” carriers (those with a quality rating based on 70 percent quality using data from customer evaluations and 30 percent price) as well as non-indexed carriers (those without a quality rating, either because they are new in the program or have not had sufficient traffic volume and resulting evaluations to produce a quality rating). Page 4 GAO/NSiAD-99-139RPersonal Properly Programs ENCLOSURE ENCLOSURE (D) Customer Satisfaction DOD does not administer or use customer surveys. Local transportation officials provide performance quality feedback on individual shipments based on three factors: on-time delivery, on-time pickup, and estimate of loss or damage. These factors comprise the Total Quality Assurance Program quality score used in the allocation of traffic. GSA’s personal property program solicits carrier performance evaluations from customers and uses the results to establish carrier rankings and scope of operation that can directly affect carrier selection. GSA officials reported that the customer response rate for calendar year 1998 was about 30 percent. (E) Coverage Limitations DOD has different weight allowances for its members according to military rank. These range from 1,500 pounds for the lowest enlisted rank with no dependents up to 18,000 pounds for higher ranked officers. Coverage in the DOD program is capped at $40,000 for the depreciated value of damaged/lost items. The GSA program provides full replacement protection. This approach takes into consideration the actual costs to replace a lost or damaged item with a like item rather than basing payment on the depreciated value of an item. (709412) Page 5 GAO/NSIAIM%-139R Personal Property Programs Ordering Information The first copy of each GAO report and testimony is free. Additional copies are $2 each. Orders should be sent to the following address, accompanied by a check or money order made out to the Superintendent of Documents, when necessary. VISA and Mastercard credit cards are accepted, also. Orders for 100 or more copies to be mailed to a single address are discounted 25 percent. Orders by mail: U.S. General Accounting Office P.O. Box 37050 Washington, DC 20013 or visit: Room 1100 700 4th St. NW (corner of 4th and G Sts. NW) U.S. General Accounting Office Washington, DC Orders may also be placed by calling (202) 512-6000 or by using fax number (202) 512-6061, or TDD (202) 512-2537. Each day, GAO issues a list of newly available reports and testimony. To receive facsimile copies of the daily list or any list from the past 30 days, please call (202) 512-6000 using a touchtone phone. 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Defense Transportation: DOD and GSA Personal Property Programs
Published by the Government Accountability Office on 1999-04-15.
Below is a raw (and likely hideous) rendition of the original report. (PDF)