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- Attached to
- USC-6 Federal contract opportunity
- Solicitation number
- HTC711-08-R-0011
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The attached file contains our responses to 31 questions/comments from Industry. We will post responses to the remaining questions/comments prior to issuance of the Final RFP
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Combined Carrier Issues
| Issue | Page # | Section | Topic | Industry Comment | Government Response | Clarification |
| 1 | 7 of 61 | 1.1.2.2.1 | Riyadh, SA Customs Free days | Total free days inclusive of customs is 15 days as in all past U.S.C contracts. | ||
| Submitted 4/29/08 | 1.2.2.1.1 |
Description of issue: Past contracts have allowed for free time that was inclusive of customs clearance. The expansion of free time for unique Saudi customs does not appear to be justified.
Proposed language: As an exception to the application of linehaul rates, service to points identified as “Via Inland Customs” include delivery to a specified customs clearance facility, and after customs clearance is completed, delivery to destination. Additional time is required for customs as follows:
Point Customs Clearance Location Customs freedays (inclusive of contractor allowable freetime)
| Riyadh, SA Riyadh, SA 15 | Concur that the expansion of free time beyond 15 days stipulated is not justified. Revision to RFP language will reflect this position. | |||||
| 2 | 36 of 61 | 4 | Liquidated Damages | The carriers object to the insertion of liquidated damages. They are contrary to commercial practice and contradictory to the furtherance of the relationship. Collectively, the carrier provide best-in-class service to the government unmatched by any other available services. | After careful consideration the Government determined it is in the best interest of our partnership to remove all Liquidated Damages provisions from the U.S.C-6 RFP. | |
| Submitted 4/29/08 | Liquidated Damages – The use of liquidated damages is not a commercial practice in the international ocean transportation market. Prior U.S.C Contracts have contained liquidated damages provision that applied against the carrier and the Government. However, the Government and the Carriers typically did not seek to enforce liquidated damages. The draft U.S.C-06 contract seeks to: (a) eliminate the liquidated damages provisions against the Government; and (b) increase the level of liquidated damages that the Government could assess against the Carrier for not meeting RDDs by up to 300 percent. Moreover, the Government seeks to extend the application of liquidated damages to exigency areas. Under U.S.C-05, liquidated damages did not apply to exigency areas because of the inherent difficulties of providing timely deliveries in those areas. | |||||
| Submitted 4/29/08 | Liquidated damages are not appropriate under the USC-06 Contract because liquidated damages do not reflect best commercial practices. The commercial market does not use liquidated damages because they are not efficient or effective in this environment. From a financial perspective, liquidated damages can be extremely inefficient because carriers may include a contingency in their pricing to offset the potential assessment of liquidated damages. There is also a cost associated with administering liquidated damages provisions. From an operational perspective, liquidated damages are not designed to correct the operational obstacles that may be preventing delivery by the requested dates. Moreover, onerous liquidated damages can backfire on a shipper, especially in a tight market where shippers are competing for space, because cargo without liquidated damages is more attractive to carriers. In addition, liquidated damages may discourage carriers from offering inland transportation for those inland routes that present high risks of delays. | |||||
| Submitted 4/29/08 | Simply put, liquidated damages will not make the cargo move any faster. Liquidated damages are also not appropriate under the circumstances of USC-06 if the FAR is faithfully applied. FAR § 11.501(a) requires that the contracting officer must “consider the potential impact on pricing, competition, and contract administration before using a liquidated damages clause.” As explained above, a possible if not probable impact of liquidated damages is higher prices to account for the increased risks of doing business with the military, particularly in exigency areas where some level of unforeseen delay will be unavoidable. Liquidated damages also will create a contract administration quagmire when carriers challenge an assessment of liquidated damages because of inaccurate data or excusable delay. Indeed, it is quite possible that the costs of administering the liquidated damages provisions will be higher than any amounts actually recovered. | |||||
| Submitted 4/29/08 | FAR § 11.501(b) further provides that liquidated damages cannot be “punitive” or be used as “negative performance incentives.” Rather, liquidated damages are to be used only “to compensate the Government for probable damages.” However, the draft USC-06 liquidated damages provisions appear to violate those regulations. The liquidated damages are punitive because the amounts are so high and 100 percent compliance with RDDs is unrealistic. Indeed, the primary objective served by the USC-06 liquidated damages would be to provide shippers with a “stick” to use as a negative performance incentive. The liquidated damages, moreover, do not appear to be designed to compensate the Government for “probable damages.” The Government has not provided any data to demonstrate how the liquidated damages reasonably approximate probable damages. Furthermore, we do not believe that “probable damages” can be demonstrated where the setting of RDDs is so subjective and the ultimate use of cargoes is so varied. | |||||
| Submitted 4/29/08 | If the underlying objective is to obtain reliable service at a reasonable price, there are better ways to achieve that objective than through a liquidated damages program. A reinvigorated joint Quality Council can help eliminate delays resulting from lack of coordination between the Government and Carriers. Performance incentives for exceeding commercial standards also can be explored. Accordingly, the Carriers recommend that the liquidated damages provisions be removed because they are not commercial, do not comport with applicable regulations, and will not achieve the desired results. | |||||
| 3 | 37 of 61 | 5 | Service Contract Act | The carriers object to the insertion of the Service Contract Act. The insertion of the clause and applicability to the CONUS trucking contracts will result in extensive and continuing administrative costs that will be passed on to the Government. This clause is unrealistic/unworkable for an ocean services contract. | SCA is required by Law for performance in US. TCAQ is pursuing a waiver however, it is currently a requirement for USC-6. | |
| Submitted 4/29/08 | (a) Statement of the Issue: The Service Contract Act (SCA) has not previously been applied to USC contracts, and it introduces a tremendous amount of cost uncertainty and administrative burden for both the carriers and the Government. It will not be possible to price inland service in the U.S. until the issues discussed below are resolved. Because container terminal and rail labor tend to be unionized and relatively uniform in terms of wages and employment status, the carriers do not anticipate insurmountable difficulties with respect to those services. With respect to CONUS trucking services, however, implementation of the SCA appears virtually impossible. | |||||
| Submitted 4/29/08 | The reason that CONUS trucking presents such difficulty is that the majority of the drayage drivers that haul containers on short routes between pick-up points and ports are independent owner-operators that are compensated on a per-mile or per-trip basis. They are not employees of any contractor or subcontractor at any tier. The drivers are paid market rates, but those rates are not rationally convertible to hourly wages because port congestion, road conditions, and traffic conditions can substantially affect the time required for a particular move. In addition, the cost structure (and thus the net earnings) of these independent owner/operators differ, making the concept of a “prevailing wage” virtually meaningless. | |||||
| Submitted 4/29/08 | The contract provides that the contractor is to access the prevailing wage determination from the Department of Labor online database. A query of that database indicates only one classification of drivers that would appear to be potentially applicable – category 31364, tractor trailers. The wages listed for that category are presumably from the long-haul or “over-the-road” market, not for drayage hauls. The carriers believe that the rates listed by DOL would not in many cases be matched in the drayage business, even assuming that one could realistically determine what is being paid on an hourly basis for drayage service. |
Based on the statutory exemption at 41 U.S.C. § 356(3) governing transportation by truck, rail, airplane, Submitted 4/29/08 pipeline, etc. “where published tariff rules are in effect,” the carriers do not believe that the SCA applies to this contract. We recognize, however, that DOL might take a different approach based on its regulations at 29 C.F.R. § 4.118. In the event that the SCA is determined to apply, the carriers believe that “special circumstances” exist under 41 U.S.C. § 353(b) to authorize the Secretary of Labor to issue an exemption for this contract.
b. Recommended Solution: Based on the foregoing, the carriers request that the Government agree to establish a joint carrier/Government working group to devise a strategy for resolving this issue. Among the options to consider are:
1.Request that DOL provide a ruling regarding the applicability of the SCA in light of 41 U.S.C. § 356(3).
2.If the DOL rules that the SCA is applicable, request that DOL issue an exemption under 41 U.S.C. § 353(b).
3.If DOL holds that the SCA applies and it declines to adopt an exemption, the Government should petition the DOL to establish a separate category for drayage drivers operating at each U.S. load and discharge port.
| 4 | 9 of 65 | 3.A.9 | Customer Service Assistance | Customer service is available during local business hours, in accordance with commercial standards. | Industry agreed to provide points of contact to support 24/7 issue resolution. No change to RFP language required. |
| Submitted 4/29/08 | Description of Issue: Commercial carriers do not routinely provide 24/7 service outside of local business hours. Proposed language: The Contractor shall establish a customer service capability to respond to U.S. Government activities throughout the business day to provide expert assistance in answering questions, exchanging information, and resolving problems. The Contractor shall provide specific points of contact for each U.S. Government shipper no later than seven days after contract award. | ||||
| 5 | 11 of 65 | 3.A.12 | Required Delivery Dates (RDD) | The Government has failed to provide the transit time matrix used for RDD construction. Any carrier agreement would be predicated on establishing a mutually agreeable, realistic and achievable RDD's. | Matrix will be provided to the Carriers seperately and will not incorporated into the Contract |
| Submitted 4/29/08 | Description of issue: The Government has yet to provide the transit time matrix used for RDD construction. Any carrier agreement would be predicated on establishing a mutually agreeable, realistic and achievable RDD's. |
Proposed language: The Contractor shall deliver all cargo by the Required Delivery Date (RDD) specified in the accepted booking. The booking shall be based on the agreed upon RDD guidelines as stated in attachment 3.
| 6 | 12 of 65 | 3.A.15 | Chassis Requirements | Carriers object to the language as it is impractical and not applicable to all points worldwide. | Add language that chassis detention will be applicable and reference detention rate matrix. | Recognizing that situations occur where chassis supporting shipper owned containers are retained beyond free time, the appropriate remedy for industry is that detention shall be assessed for chassis IAW detention rate matrix. |
| Submitted 4/29/08 | Containers delivered to the Government or spotted by the contractor must be on a contractor-provided chassis that supports stuffing/unstuffing operations by the Government. The chassis must remain with the container while in the custody of the Government; unless this requirement is waived by the local receiving facility, or customs of the trade do not normally call for the use of chassis. | |||||
| 7 | 13 of 65 | 3.A.23.1 | Daily ITV | Limit ITV reporting to Afghanistan and Pakistan. All other locations subject to mutual agreement. There is no provision for payment for this service. Insert language from USC05. | 3.A.23.1 Inland ITV services identified in this section shall apply to Afghanistan, Pakistan, Uzbekistan, Tajikistan, Kazakhstan, Turkmenistan, Kyrgyzstan, Jordan and Iraq, or other areas as directed by the Contracting Officer. When ordered, the Contractor shall be paid an additional daily ITV Surcharge in accordance with the Table of Accessorial Rates. | The Government requires this capability in support of the Combatant Commanders when requested by the Contracting Officer. |
| Submitted 4/29/08 | 3.A.23.1 Inland ITV services identified in this section shall apply to Afghanistan, Pakistan, Uzbekistan, Tajikistan, Kazakhstan, Turkmenistan, or Kyrgyzstan "The Stans". All other locations are subject to mutual agreement between Government and Contractor. When ordered, the Contractor should be paid an additional daily ITV Surcharge in accordance with the Table of Accessorial Rates. | |||||
| 8 | 15 of 65 | 3.C.1.3.3 | Pick up of Government owned containers | The pickup requirement including associated costs set forth in this clause must be mutually agreed, considering capabilities of carrier. | 3.C.1.3.3 The Contractor may, at the request of the Ordering Officer, pick up empty U.S. Government owned or leased containers from locations separate from the designated loading location and deliver them to the shipper for loading. Rates for this will be mutually agreed to through bilateral modification to this contract. The container shall be spotted at the shipper’s location using rules for live load, drop and pick or pool as would apply for a Contractor provided container. | Concur with Carrier position with the following exception: the term "payment" has been changed to "rates". |
| Submitted 4/29/08 | 3.C.1.3.3 The Contractor may, at the request of the Ordering Officer, pick up empty U.S. Government owned or leased containers from locations separate from the designated loading location and deliver them to the shipper for loading. Payment for this will be mutually agreed to through bilateral modification to this contract. The container shall be spotted at the shipper’s location using rules for live load, drop and pick or pool as would apply for a Contractor provided container. | |||||
| 9 | 18 of 65 | 3.E.1..6 | Customs Clearance - Border Clearance | Language does not reflect current conditions. The carriers are dependent upon the timely supply of services and submission of requisite documentation in order to secure import/export clearances. Section 6 must be revised to provide compensation to the carrier for Government responsible delays. | ||
| Submitted 4/29/08 | 3.E.1.6.1 Import/Export Services: The Contractor shall be responsible for the preparation and/or completion of all required documentation and the submission of the documentation to the appropriate embassy and/or local U.S. Government agencies for the approval, certification, stamping and/or signatures necessary to obtain border clearances and transit. Countries shall be identified on the Table of Accessorials. |
3.E.1.6.2 The requested services include, but are not limited to, the completion, preparation, and submission of exemption forms, cargo declarations, goods declaration forms, and importation/exportation forms necessary to effect border transit from origin to port.
| 3.E.1.8 The Contractor shall be paid at the rates set forth in Accessorial Table 6 for import and export clearance services. 3.E.1.7 Notification of Cargo Held by Customs. The Contractor shall promptly notify the COR, or designee within 24 hours, if cargo is held up by Customs, or if the local port authorities require direct US Government intervention for cargo terminal clearance. | 3.E.1.6.1 Concur with Industry language. 3.E.1.6.2 Concur with Industry language. 3.E.1.7 Notification of Cargo Held by Customs. The Contractor shall promptly notify the COR, or designee within 24 hours, if cargo is held up by Customs, or if the local port authorities require direct US Government intervention for cargo terminal clearance. 3.E.1.8 Concur with Industry language. 3.E.1.9 The Contractor shall be entitled to reimbursement under Attachment 6 for delays at borders attributable to the U.S. Government. | Language proposed at 3.E.1.9 is provided in lieu of Industry proposed language at 3.E.1.7. | ||||
| Submitted 4/29/08 | The U.S. Government shall be responsible for delays at border clearance attributable to the lack of U.S. Government documents, incomplete Government documents, or the lack of Government investigation/resolution of cargo – customs clearance issues. The Contractor will be entitled to the reimbursement under Attachment 6 – Additional Charges of truck detention, truck waiting time, and other delay related charges incurred at the border attributable to the U.S. Government’s action or inaction. | |||||
| 10 | 18 of 65 | 3.F.1 | Delivery Notification and Receipt | The terms in the clause are impractical in their application. The clause creates a significant administrative burden on the Carrier, SDDC, and its customers and is counter to commercial practice. | Concur with Carriers' position, proposed language provided below. | |
| Submitted 4/29/08 | The contractor must: |
F.1.1 Schedule all deliveries of containers with the consignee or consignee’s agent at least two working days prior to any actual delivery of containers.
F.1.2 Not deliver containers on the same day as notification unless approved by the consignee.
F.1.3 Deliver all containers to each consignee during the consignee’s normal business hours. F.1.1 Schedule all deliveries of containers with the consignee or consignee's agent at least two working days prior to any actual delivery of containers.
F.1.2 Not deliver containers on the same day as notification unless approved by the consignee.
F.1.3 Deliver all containers to each consignee during the consignee's normal business hours.
F.1.4 The Contractor shall provide a delivery receipt for the consignee or agent to sign to acknowledge receipt of the container and to annotate any exceptions.
F.1.5 The contractor shall display on the truck or container a placard with identifying marks where required by local practice.
F.1.6 A signed delivery receipt with no damage noted does not preclude the U.S. Government frompursuing a claim for damages discovered after delivery.
| 11 | 3.F.2 | Expedited Delivery | Should apply to Live-Unload containers only. | See new language below: | Changes in mileage limitations from 500 to 300 miles would have an unacceptable operational impact on Government stakeholders. |
| Submitted 4/29/08 | 3.F.2.1 |
Description of issue: Normal commercial practices in Europe require the trucker to provide his own chassis. The normal practice is for the cargo to be live unloaded for longer haul shipments.
Proposed language: Expedited delivery service: The Contractor shall provide expedited delivery when ordered by the Ordering Officer or COR. The Contractor shall deliver the container to consignees in Germany within two business days and one business day at all other locations commencing at 0001 hours on the first working day following vessel discharge or customs clearance of such containers, whichever is later, for distances of up to 300 miles. For distances greater than 300 miles, Contractors shall be provided an additional day for each 300 miles of distance. Unless otherwise agreed the consignee is required to "live unload" containers transported under Expedited delivery service. EXCEPTION: Expedited delivery of shipments enroute, but prior to commencement of on-carriage at port of discharge, shall be by mutual consent of the U.S. Government and the Contractor. 3.F.2.1 Expedited delivery service: The Contractor shall provide expedited delivery when ordered by the Ordering Officer or COR. The Contractor shall deliver the container to consignees in Germany within two business days and one business day at all other locations commencing at 0001 hours on the first working day following vessel discharge or customs clearance of such containers, whichever is later, for distances of up to 500 miles. For distances greater than 500 miles, Contractors shall be provided an additional day for each 500 miles of distance. When the contractor schedules delivery by appointment for a mutually agreed on time and date the consignee shall be required to "live unload" containers transported under expedited delivery service ordered by the U.S. Government. EXCEPTION: Expedited delivery of shipments enroute, but prior to commencement of on-carriage at port of discharge, shall be by mutual consent of the U.S. Government and the Contractor.
| 12 | 3.F.4 | Container pick-up/return | The Government’s attempt to bill the Carrier for pickup delays is not practical. Government CMST notices are often incomplete and inaccurate. The Government language fails to recognize locations that require transit times that are longer than 3 days. | See new language below: | Expanded Carriers recommendation to include all future exigency areas. | |
| Submitted 4/29/08 | The Contractor shall remove empty containers within three business days after receiving notice from the U.S. Government that the container is available. The U.S. Government may submit to the Contractor documentation for payment of additional costs incurred as a result fo Contrator's delay. Exception: The 3 business day rule does not apply for empties in Iraq, Afghanistan, Pakistan, Uzbekistan, Kyrgyzstan, Tajikistan, and Kazakhstan. | Final Postion: Based on carrier input and customer needs The RFP will contain the following language: The Contractor shall remove empty containers within three business days after receiving notice from the U.S. Government that the container is available. The U.S. Government may submit to the Contractor documentation for payment of additional costs incurred as a result fo Contrator's delay. Exception: Exigency areas are exempt from this requirement. | ||||
| 13 | 23 of 65 | 3.G.3 | Canceled Shipments/No shows | As in USC05, cancellation notice must be at least 24 hours before carrier cutoff. The deletion of Liquidated Damages provision contained in USC05 is in furtherance of our partnership. See comments under 4.3 above. | Concur with Carriers, USC-6 RFP will include the 24 hour cutoff notification requirement. Notification requirement is consistent with USC-05 language. | |
| Submitted 4/29/08 | Please refer to comments under Section 4 (36 0f 61) regarding liquidated damages." | |||||
| 14 | 25 of 65 | 3.G.4.5.2.2 | Investigation of tampering/loss | Limit no carrier charge for wait time to 4 hours. | ||
| Submitted 4/29/08 | (Currently in Draft RFP USC-6) 3.G.4.5.2.2 Shipments delivered with evidence of tampering or loss shall be investigated by base security and drivers may be queried by base security. Wait time is not payable for these delays | 3.G.4.5.2.2 Shipments delivered with evidence of tampering or loss shall be investigated by base security and drivers may be queried by base security. If investigation determines no tampering occurred, applicable wait time rates will be paid. If the investigation determines that tampering/pilferage has occured, wait time will not be payable. | If no pilferage occurred the regular wait time rates shall apply. If evidence of pilferage/loss is present then wait time is not payable. | |||
| 15 | 27 of 65 | 3.G.8 | Damage to Carrier Equipment | Object to the waiver provision at time of container return. Must be done at a carrier port or CY where a true inspection can take place. | Retain USC-05 provisions. | USC and VISA are two separate contracts, and therefore, MSA 2003 applicability to VISA does not apply to USC |
| Submitted 4/29/08 | Damage to Carrier Equipment – The Damage to Contractor Equipment clause should be revised because it is contrary to the compensation principles set forth in the Maritime Security Act of 2003 (“MSA 2003”). MSA 2003 provides that “[a]ll commercial transportation resources activated under an Emergency Preparedness Agreement shall, upon termination of the period of activation, be redelivered to the contractor in the same good order and condition as when received, less ordinary wear and tear, or the Secretary of Defense shall fully compensate the contractor for any necessary repair or replacement.” Since the USC contract has effectively been utilized as the voluntary stage of VISA, the MSA 2003 provisions should apply. Accordingly, the Carriers propose that the Section 3.G.8 of the PWS be replaced with the following language. | |||||
| Submitted 4/29/08 | All commercial transportation resources delivered by the Contractor under the Contract shall be redelivered to the contractor in the same good order and condition as when received, less ordinary wear and tear, or the Government shall fully compensate the contractor for any necessary repair or replacement. The Government shall notify the Contractor of loss or damage to Contractor’s equipment. In the event that the Government does not notify the Contractor of loss or damage to the Contractor’s equipment, the Contractor shall have a reasonable time after redelivery of the container and receipt/inspection at the Contractor Port or CY Facility to notify the Government of such loss or damage. | |||||
| 16 | 28 of 65 | 3.G.10 | Equipment Interchange | Carriers cannot reasonably agree to the interchange of containers anymore than they would agree to the interchange of any other corporate asset. This was discussed thoroughly at the IPT and mutually understood to be impractical. | Concur with Carriers and removed language. | |
| 17 | 30 of 65 | 3.H.6 | Flatrack tie-down surcharge | There is no reference in the PWS to the amount of surcharge for this service. | Concur with Industry approach to flat rack / tie down equipment charges, however, the Industry proposed changes appear high. Therefore, the Governemnt will conduct Market Research to establish the appropriate price for this assessorial charge. | |
| Submitted 4/29/08 | Proposed language - 3.H.6 Flatrack tie-down equipment surcharge: |
When ordered by the Ordering Officer, the Contractor shall deliver the empty flatrack with supplies and materials to secure the load to the flatrack appropriate for the cargo as described in the booking. Contractor is not required to provide dunnage. Rates for chains and binders are $375 per vehicle or piece of cargo to be secured. If two vehicles can be stuffed onto one flatrack, the rate would be $375 x 2 = $750.
| 18 | 3.H.9 | RFID Tag | Delete this clause. Impractical for carrier to implement. |
| Submitted 4/29/08 | Proposed Language - 3.H.9 |
At the request of the US Government, the contractor may receive, attach and/or affix RFID tags to containers or cargo. Contractor is responsible to match data on the outside of the tag with the appropriate container or piece of cargo. When no tags are received by the vessel cutoff date, the Contractor shall notify the responsible shipping activity and the SDDC activity responsible for documentation. US Government and carrier will negotiate a price for this service.
| Suggest language to be added that would release liability to the carrier when we perform the RFID placement services. | Retaining language in draft RFP. | This capability is required by the US Government. | |||
| 19 | 30 of 65 | 3.I.1.2 | Cargo Lift reports | Extend time to provide information for BB/Unit cargo. | |
| Submitted 4/29/08 | Description of issue: The inherent booking process for breakbulk cargo, especially large Unit Moves, require both the carrier and the government to work together after a vessel sails to update booking data. Once that data is finalized, the carriers must then update their internal systems. Turning that information around back to the government in a “Lift on Board” report within 24 hours is unrealistic for large shipments. We recommend that timing be extended to two working days. |
Proposed language:
| 3.I.1.2 For breakbulk cargo moving under liner terms, within one working day after vessel departure from each POE, the Contractor shall provide to the cognizant COR a list of cargo by TCN, which was booked but not loaded, and/or loaded but not booked, and the reasons why cargo was not lifted as booked. The contractor shall submit cargo lift reports within two working days after receipt of booking and/or lift details from the government. (See attachment 7) | Concur with Carriers' proposed language. | ||
| Submitted 4/29/08 | Attachment 7 |
Reports and Formats
3. Cargo Lift Information – Breakbulk
3.1. Required by: 3.A.21.
3.2. Reports due: Next business day after vessel departure or two working days after receipt of cargo details from the government.
3.3. Medium: Excel attachment to email
3.4. Distribution: Cognizant SDDC terminal as advised by COR
3.5. Report format:
Contractor Name and SCAC code Cargos lift information (CONUS/OCONUS ports of loading) PCFN/Contractor booking number Name of vessel and voyage document number Transportation Control Number (TCN) Piece, Weight and cube Commodity Code Port of Embarkation Port of discharge Final destination General description of cargo contents; i.e., mail/mail equipment, privately-owned vehicles (POVs), other unboxed wheeled or tracked vehicles, refrigerated cargo seal and/or keyless lock number
| 20 | 31 of 65 | 3.I.2 | Services during Hazardous cargo handling | Contractors payment should not be subject to negotiations, rather carrier is entitled to be paid for services required by local ordinances and regulations. | Concur with Carriers' proposed language. |
| Submitted 4/29/08 | Proposed Language - 3.I.2 |
3.I.2 Services During Hazardous Cargo Handling When ordered by Ordering Officer or required by local ordinance, the Contractor shall provide fireboats, tugs, and pilots on a standby basis, during ammunition, explosives, or other hazardous cargo handling operations. Contractors shall submit charges for such services to the Contracting Officer for compensation
| 21 | NA | Rail pricing | Will there be rail pricing in CARE? For a carrier to offer competitive pricing compared to the existing tender process, we suggest the government include a tiered CLIN structure based upon volume of railcars for a specific move. | Rail pricing will be included in CARE but without a tiered CLIN structure. | The Government will continue to require that all line-haul rates be bid on a per unit basis to preserve a common pricing structure among modes. Where cargo is out of gage or a shipment exceeds 100 carloads, Government may chose to negotiate a one-time price for the shipment as described in Para 3.K.3 below. |
| Submitted 4/29/08 | Description of issue: The draft breakbulk rail pricing requirements are not in line with the current practice in the rail industry. The suggested language provides the most cost-effective process for the government. |
Proposed language:
3.K Linehaul for Breakbulk and Out-of-Gauge (OOG) Cargo 3.K.1 Flatbed and double drop service 3.K.1.3.7 The Contractor may choose to use other types of equipment that can accommodate the cargo, including rail; however, when cargo moved by truck, the Contractor shall be paid for flatbed or double drop service as determined by the height of the cargo as specified in Para. 3.K.2 above.
3.K.2.1 The Contracting Officer may request rail linehaul rates for breakbulk shipments as required. Rates are not solicited but may be negotiated for specific requirements. Government position on each recommendation is reflected in the following language: 3.K.1.3.7 The Contractor may choose to use other types of equipment that can accommodate the cargo; however, the Contractor shall be paid for flatbed or double drop service as determined by the height of the cargo as specified in Para. 3.K.2 below.
3.K.2 Carload Service 3.K.2.1 Ordering Officers may order linehaul movement for breakbulk shipments or flatrack container using carload rates when rates are provided and:
3.K.2.1.2 Cargo is:
8'6" or less wide 48' or less long 10' or less high 40,000 lbs or less weight 3.K.2.1.2.4 Rates are not solicited but may be negotiated for cargo exceeding these dimensions.
Submitted 4/29/08 3.K.2.2 Service Requirements 3.K.2.2.1 Contractor's loading and securing of cargo on conveyance at POD and removal from conveyance at POE is included in liner term rates for breakbulk.
3.K.2.2.2 Shipper shall be responsible for loading and securing cargo onto Contractor equipment and shall resecure/reload any cargo the Contractor’s inspector rejects.
3.K.2.2.3 EDI reporting requirements apply for events as specified in Section 3, Para. A.10.21.
3.K.2.2.4 Delivery 3.K.2.2.4.1 Before dispatch from the port, the Contractor shall notify the receiver, SDDC and SDDC's rail ITV Contractor of the imminent shipment. This notice to the consignee shall be by email to the receiver and SDDC. Other organizations shall be included in the email distribution as advised by the consignee or COR.
3.K.2.2.4.2 Receiver is responsible for unloading cargo from Contractor provided equipment. 3.K.2.2 Service Requirements 3.K.2.2.1 Contractor's loading and securing of cargo on conveyance at POD and removal from conveyance at POE is included in liner term rates for breakbulk.
3.K.2.2.2 Shipper shall be responsible for loading and securing cargo onto Contractor equipment and shall resecure/reload any cargo the Contractor’s inspector rejects.
3.K.2.2.3 EDI reporting requirements apply for events as specified in Section 3, Para. A.10.21.
3.K.2.2.4 Delivery 3.K.2.2.4.1 Before dispatch from the port, the Contractor shall notify the receiver, SDDC and SDDC's rail ITV Contractor of the imminent shipment. This notice to the consignee shall be by email to the receiver and SDDC. Other organizations shall be included in the email distribution as advised by the consignee or COR.
3.K.2.2.4.2 Receiver is responsible for unloading cargo from Contractor provided equipment.
Submitted 4/29/08 3.K.2.3 Free time and demurrage applies at both origin and destination.
3.K.2.3.1 Receiver/shipper shall be allowed two free days , starting on the first work day after receipt of equipment. Holidays and weekends do not count as free days. At end of free time, demurrage shall run until the Contractor is notified that equipment is available for pickup.
3.K.2.3.2 Detention shall be paid at rate of $75.00 per day per railcar.
3.K.2.3.3 For cars ordered but not used the Contractor shall be compensated $200.00 per railcar. Contractor is entitled to compensation only if the actual cargo tendered differs from the cargo described in the booking.
3.K.2.4 Accessorial services 3.K.2.4.1 When ordered, the Contractor shall provide Greater Security Service and be compensated in accordance with rates at Table XX for each railcar. 3.K.2.3 free time and demurrage applies at both origin and destination 3.K.2.3.1 Receiver/shipper shall be allowed three freedays , starting on the first work day after receipt of equipment. Holidays and weekends do not count as freedays. At end of free time, demurrage shall run until the Contractor is notified that equipment is available for pickup. Neither demurrage nor free time for any time that the shipper/receiver operations are interfered with by weather, strike etc 3.K.2.3.2 Detention shall be paid at rate of $75.00 per day per railcar 3.K.2.3.3 For cars ordered but not used the Contractor shall be compensated $200.00 per railcar. Contractor is entitled to compensation only if the actual cargo tendered differs from the cargo described in the booking 3.K.2.4 Accessorial services 3.K.2.4.1 When ordered, the Contractor shall provide Greater Security Service and be compensated at $75 railcar.
| Submitted 4/29/08 | 3.K.2.5 Pricing and Rate Rules | ||
| 3.K.2.5.1 Service from/to military installations includes delivery/pickup at a railhead on the facility, except that service to/from military facilities that do not have rail service on base shall be from/to a location designated by activity. Rates include drayage or other service connecting the facility with railhead. | 3.K.2.5 Pricing and Rate Rules |
3.K.2.5.1 Service from/to military installations includes delivery/pickup at a railhead on the facility, except that service to/from military facilities that do not have rail service on base shall be from/to a location designated by activity. Rates include drayage or other service connecting the facility with railhead.
3.K.3 Where cargo exceeds the dimensions at 3.K.1.3.1 or 3.K.2.1.2 above or a shipment exceeds 35 carloads, Government may chose to negotiate a one time price for the shipment.
| 22 | 38 of 65 | 4.A.5 | Provisions for POV's | The carriers object to the insertion of liquidated damages. They are contrary to commercial practice and contradictory to the furtherance of the relationship. Collectively, the carrier provide best-in-class service to the government unmatched by any other available services. | Language of $30 per day is unchanged. This is a cost of the POV contractor who reimburses the member. |
| Submitted 4/29/08 | (use same language as in USC-05) |
4.A.5 Special provisions for Privately Owned Vehicles (POVs).
If the Contractor fails to deliver a POV on or before the booked RDD, the Contractor shall reimburse the Authorized Agent for rental car expenses or other transportation expenses paid to the owner of the POV as a consequence of such delay. This reimbursement shall not exceed expenses actually incurred by the owner of the POV or $30.00 per day for each day past RDD, whichever is less. The Contractor should be resolving any issues of this nature directly with SDDC and not thru AAL as the above statement encourages.
The booking of POVs with the contractor is premised on the ability of the contractor to achieve the RDD associated with each individual POV. The ability of the contractor to achieve the POV RDD is determined by reference to the Ocean Transit, Inland Delivery and other time periods provided herein concerning the overall movement of cargo from the time it is tendered to the contractor by the Government at origin until it is delivered at the designated destination in the booking/shipping order.
| Submitted 4/29/08 | In accepting a POV booking/shipping order, the contractor warrants that it can achieve delivery of the POV by the designated RDD under the terms and conditions of this contract. If the contractor fails to deliver a POV on or before the RDD, the Contracting Officer shall assess $30.00 in damages per diem against the contractor. Damages shall be assessed for each day that the delivery exceeds the RDD, including the day of delivery, up to a maximum period of seven calendar days (maximum contractor liability of $210.00 per POV). The contractor may be exonerated from this liability only under circumstances constituting Force Majeure or an Excusable Delay (FAR 52.212-4(f)). The contractor is at all times required to deliver the POV as soon as possible following the conclusion of any Force Majeure or Excusable Delay circumstance. If the failure to achieve delivery by the RDD is partially excused, damages shall be assessed on a pro rata basis. The contractor bears the burden of establishing exoneration on the basis of any Force Majeure or Excusable Delay circumstance. | |||||
| 23 | 5.A.1.2 | Performance Measurement | Delete references to the Government's right to assess liquidated damages notwithstanding carrier achievement of performance standards. See carrier position under section 4 above. | Concur with carriers, will delete last sentence. | ||
| Submitted 4/29/08 | Delete last sentence……Whether the carrier meets required Performance Standards shall not affect the right of the U.S. government to assess liquidated damages. | |||||
| 24 | 41 of 65 | 5.A.2 | Performance Objectives | Carriers agree with the concepts of assessing performance based on clear metrics. The Governments original intent was to set a baseline performance level for each carrier based on its actual past performance. This language is not included in the PWS. Furthermore, without the transit time guidelines and established, effective RDD model, the carriers cannot agree to the a performance evaluation. Further, the government has not identified the process in which the SDDC G3 will use to determine when a carrier is excluded from cargo bookings, included the government's decision to activate an organic vessel rather than utilizing a commercial Bravo or Charlie carrier.The administrative burden and resulting costs associated with rolling program may outweigh the value and return of such a program. | New Performance Objectives are attached as provided during the 29 May 08 meeting. | |
| Submitted 4/29/08 | Add to section 5.A.2: The Government will establish an average carrier baseline performance level for the two performance objectives and is provided in Table 5.A.2.1. The baseline is calculated from actual carrier performance data for the prior 12 months from the start of this contract. Each carrier will be measured based on the performance standard established for each of the performance objectives (98%). For example, if the average baseline for On Time Delivery for all carriers is 85% then the performance standard for all carriers for on time delivery is 98% x .85 or 83%. | |||||
| 25 | 42 of 65 | 5.A.2.3 | Performance rating | See comments from 5.A.2 above. For BB/Unit cargo should annotate as a percentage; for total # of lifts; for total number of pieces. | See response to issue # 60. | RDD compliance is measured on each individual booking. |
| Submitted 4/29/08 | No further comments needed | |||||
| 26 | 44 of 65 | 6.C.2 | Exigency area Detention | The carriers object to arbitrary reduction of detention and credit against purchase price. Revert to USC05 rates. | Current language in USC-05 shall apply with the following exception as agreed to in the 29 May. | |
| Submitted 4/29/08 | Current rates in USC-05 should apply |
Type Days 1-90 Days 91-180 Days 181+ (Credit Against Purchase Price) 20 ft dry $22.00 $9.00 $22.00 ($13.00) 20 ft flat $22.00 $9.00 $22.00 ($13.00) 20 ft reefer $70.00 $44.00 $70.00 ($26.00) 40 ft dry $35.00 $16.00 $35.00 ($19.00) 40 ft flat $35.00 $16.00 $35.00 ($19.00) 40 ft open top $35.00 $16.00 $35.00 ($19.00) 40 ft reefer $92.00 $57.00 $92.00 ($35.00) Type Days 1-90 Days 91+ (Credit Against Purchase Price) 20 ft dry $22.00 $22.00 ($13.00) 20 ft flat $22.00 $22.00 ($13.00) 20 ft reefer $70.00 $70.00 ($26.00) 40 ft dry $35.00 $35.00 ($19.00) 40 ft flat $35.00 $35.00 ($19.00) 40 ft open top $35.00 $35.00 ($19.00) 40 ft reefer $92.00 $92.00 ($35.00) 20 ft chassis $9.00 $9.00 40 ft chassis $16.00 $16.00
| 27 | 45 of 65 | 6.C.3 | Exigency Area Container Purchase | The carriers object to the Governments unilateral reduction of the container purchase rates and minimum days of detention. Reinsert the agreed upon USC05 container purchase rates and the 180 day detention threshold. | Concur with Carriers' proposed language with the following exception. In coordination with Industry it was determined that the container purchase option can be exercised after the initial 90 days of detention. | Per discussions meeting of 29 May 08 earlier purchase decision point expedites contractors' to replace assets in their networks. |
| Submitted 4/29/08 | (4) A container may be purchased if it has accrued a minimum of 180 days of detention. After the initial 180 days of detention, the Government will be granted a 30-day grace period in which it can return the container, request pick-up of the container, or notify the Carrier that it will purchase the container. Detention accrued/paid through the first 180 days of detention shall not be applied to the purchase price. If, during this 30-day grace period, the Government returns the container, requests pick-up, or notifies the Carrier that it will purchase the container, it will not accrue further detention. If the Government does not take one of these actions within this grace period, it will be obligated to pay further detention from Day 181 until conclusion of detention through container return, pick-up, or purchase. For containers that are purchased, detention accruing beginning on Day 181 shall include a daily credit against the purchase price, as reflected in the table above. | |||||
| Submitted 4/29/08 | (For example, the Day 181+ detention rate for a D20 is $22. Of the $22, $13 is a credit against the purchase price.) Day 181+ detention will continue to accrue until the container is returned or requested for pick-up, or the Government notifies the Carrier that it will purchase the container. | |||||
| Submitted 4/29/08 | If the Government returns or requests pick-up of the container after Day 180, it shall not be entitled to a refund of any accumulated Day 181+ detention including the purchase price credit. Detention will cease to accrue when the accumulated credit against detention for the container equals the container purchase price herein. When the Government pays the purchase price as adjusted by any applicable credits, and any unpaid detention, for the equipment or accumulates credit equal to the purchase price and has paid all accrued detention, it shall on that date have title to the equipment. |
The Government will have the unilateral right to purchase immediately any container that has been lost or destroyed. The purchase will be completed in accordance with Section 3, G.8 and G.9 at any time during the detention period, after free time has expired, at the rates established in this clause for purchase of containers (see below). In calculating the purchase price under G.4.3, detention already accrued will not be credited against the purchase price, except as otherwise provided herein.
Submitted 4/29/08 If the containers are purchased in accordance with G.4.3.2 the following Container Purchase Rates shall apply:
Container Type Purchase Price 20 ft Dry $3,200 20 ft Flat $5,000 20 ft Reefer $31,500 40 ft Dry $5,100 40 ft Flat $7,000 40 ft Open Top $6,500 40 ft Reefer $35,000 Genset* $11,000 *In order to purchase a genset under G.4.3.2, the Government also must purchase the reefer that the genset services.
The Prompt Payment Act shall apply to carrier invoices for detention and container purchases under G.4.3.
| 28 | 46 of 65 | 6.D.1.2 | Performance Requirements | Carriers agree with the concepts of assessing perfomance based on clear metrics. The Governments original intent was to set a baseline performance level for each carrier based on its actual past performance. This language is not included in the PWS. Furthermore, without the transit time guidelines and established, effective RDD model, the carriers cannot agree to the a performance evaluation. The administrative burden and resulting costs associated with rolling program may outweigh the value and return of such a program. | See response to issue # 60. | |
| Submitted 4/29/08 | Add to section 6.D.1: The Government will establish an average carrier baseline performance level for the two performance objectives and is provided in Table 6.D.1.2. The baseline is calculated from actual carrier performance data for the prior 12 months from the start of this contract. Each carrier will be measured based on the performance standard established for each of the performance objectives (98%). For example, if the average baseline for On Time Delivery for all carriers is 85% then the performance standard for all carriers for on time delivery is 98% x .85 or 83%. | |||||
| 29 | Attachment 3 | Transit Time Matrix | Government has included the USC05 SCR transit time matrix. It was agreed to replace this with an RDD model that is agreeable to carriers and the Government. Please see comments in 3.A.12. | Matrix will be provided seperately. | ||
| Submitted 4/29/08 | The current USC-05 SCR Transit Time Matrix should be replaced by the Required Delivery Date (RDD) model to be provided by the Government and substituted for the current (Attachment 3) in USC-06. RDD's should be consistent and agreed upon between Contractor and Government and used as a guide at the time of booking. | |||||
| 30 | New Issue: DBA Submitted 4/29/08 | Prior USC contracts did not contain any contract clauses that provided the Defense Base Act (DBA) and its associated insurance requirements applied to the services provided under those contracts. For over a year, Carriers have raised the issue with SDDC/TRANSCOM of whether the DBA applied and, if so, how does it apply given the nature of the services provided under the USC contracts. Carriers received very little feedback from the Government until a contract clause appeared in the draft USC-06 solicitation. | ||||
| The application of the DBA to the services provided under the USC contracts remains unclear to the carriers. Until the carriers and the Government reach a mutual understanding of DBA requirements as they apply to the USC contract services, it is extremely difficult if not impossible for the carriers to develop a viable compliance program. Carriers, moreover, are unable to estimate the cost of DBA compliance and ascertain the most practical way to recover such costs from the Government (e.g., cost reimbursement, fixed surcharge, etc.). | Required by Law for performance in USC-6. | |||||
| Submitted 4/29/08 | For these reasons, the Carriers propose the establishment of a joint Government/Carrier task group to analyze DBA issues. Based on the findings of that joint task group, the Parties can amend/modify the USC Contract in a fair and equitable manner. The goal should be to ensure compliance with the DBA in the most cost-efficient manner available, without imposing additional risk on the Carriers for this military-unique requirement. | |||||
| 31 | 8 | Space Commitment | As discussed at the one on one meeting, this 10% space commitment used to only apply to designated routes. Please reinsert this language. | Concur with Industry and will reinstate USC-05 language |
&C&14Government Response #2 to Industry Comments on Draft RFP&R6 June 2008 &C &RPage &P of &N
Attachment 1
| PERTFORMANCE REQUIREMENTS MATRIX |
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