USC8_RFP_Questions_(23_JUN_15).pdf

# RFP Section Para # Question Government Response

Exhibit 3, PWS, Attachment 3 1.4

There was no discussion or pre-advice that Afghanistan Linehaul rates would now have to be good for 1 year instead of the usual 6 months. However, the 6 month provision is not mentioned in the USC-8 RFP. Are the Linehaul rates for Afghanistan now required for a 1 year period as opposed to the standard 6 month period?

In accordance with Exhibit 3, Attachment 3, paragraph 1.4, all USC rates will be refreshed annually in conjunction with Exercising the Option Period. This includes the PAKGLOC and Northern Distribution Network linehaul rates.

Exhibit 3, PWS, Attachment 3

Inoperable Vehicles

The government removed this provision from the contract. Carriers invoice inop surcharges to both government and commercial shippers. Carriers do not assume vehicles are inoperable in their liner term rates. There is a true additional cost to tow a non-operational self-propelled vehicle. This requirement should be reinstated, but perhaps clarified to exclude trailers and other equipment that is not intended to be self-propelled. The carriers also ask the rate is increased to $150 as the $75 fee has been in effect for over ten years and does not cover the additional costs invoiced to carriers by its stevedoring companies. In addition, a rate entry was added to CARE to submit a bid for Inoperable Vehicles.

The movement of vehicles, operational or inoperable, are covered under Liner Terms.

Exhibit 3, PWS, Attachment 7

Please provide base year baseline dollar values for BAF (both IFO and MGO separately), FAF, and CAF The baseline will be based on the average fuel price of Feb, Mar, and Apr. Based on feedback received from Industry, there will be a baseline per lane. This revision will be incorporated in the next amendment.

Exhibit 3, PWS, Attachment 1

AV transactions are only permitted for to door moves in Exigency Areas. For to Port Liner out moves, what EDI transaction should be submitted when the government is responsible for and completes all customs clearances and the cargo is available for the government's inland provider to pick up the cargo from the carrier's commercial terminal? Why is the carrier penalized for missing an RDD when the government is responsible to complete local customs clearance (for example to port only in CONUS). The carrier should be measured based on when it makes the cargo available for pick up by the government. Any delays due to USDA, Customs or otherwise are not the carrier's responsibility.

In such cases, carrier shall D-RAP the Government's delay, and will not be held responsible. Please note that for "to port liner out moves" in many cases the carrier nonetheless has certain responsibilities at POD, such as stripping flatracks, customs clearance duties at many locations, and notification responsibilities.

295 CARE II N/A CAREII has a requirement to submit Liner Term rates for USEC North and USEC South. There is no language in the RFP to define the port scope for these new regions. Please clarify.

Amendment 0001 clarifies that Northeast is Maine to Maryland, and Southeast is Virginia to Key West, Florida (inclusive).

Exhibit 3, PWS 3.A.5 The last sentence in this section is incomplete. Please advise the full requirement. Amendment 0001 added "Exhibit 3, PWS, paragraph 3.G.2.2" at the end of the sentence.

Exhibit 3, PWS

3.A.5

We suggest the government removes the statement that carriers cannot counter an RDD beyond 14 days of the offered RDD. The government is forcing carriers to accept a condition in which it cannot perform. The ultimate loser is the receiver where the cargo will most likely miss the RDD but the receiver has planned for on-time delivery. If the government cannot accept the longer RDD, it can refuse the counter and book the cargo with another carrier.

There needs to be (for mandatory bookings) a limit to carrier's ability to counteroffer RDD. Unlimited ability to counteroffer would constitute a constructive refusal. If a carrier feels the offered RDD plus 14 days is unreasonable, the carrier may contact SDDC on a case-by-case basis.

Exhibit 3, PWS 3.F.1.2 Please clarify this second notification provision does not apply if cargo is booked free out as the carrier's responsibility ends upon vessel arrival at the POD.

Exhibit 3, PWS will be amended to clarify that the second notification only applies when the to-port booking of Breakbulk is on a Liner-Terms basis.

Exhibit 3, PWS

3.H.3

Tarping Origin means the cargo is to be concealed from the Place of Receipt to the Port of Embarkation only.

Suggest the following sentence be removed. “In addition, concealment material shall remain on the cargo until final destination unless otherwise directed by the U.S. Government.” The local inland carriers are responsible to provide necessary tarping materials. Those inland carriers will also require the material is returned to them upon loading at the POE or delivery at the final destination.

If concealment material must remain on cargo until final destination, then Tarping Destination will be ordered.

USC-8 RFP HTC711-15-R-W002

RFP QUESTIONS

Exhibit 3, PWS

3.I.3.7

The government's response to question 107 is not correct. Carriers pay overtime to stevedoring firms at "premium hours" as the cargo is loaded on a liner basis and the full liner term freight rates charged to the commercial customer associated with those costs are taken into consideration at time of quoting the business. The USC freight rates for breakbulk cargo are based on free in/free out costs and no stevedoring charges are assumed in those ocean freight rates. The liner term rates cover stevedoring and are only applicable for cargo booked on a liner term basis.

Carriers have advised that they will not normally be calling such ports outside normal business hours, but occasionally late-breaking circumstances arise that require this.

The next amendment to the solicitation addresses this concern by allowing carriers up to 4 occurrences per Rate Year without being charged for such costs.

301 Exhibit 4 2.2.D Request the government provide a sample screenshot of the composite score data visible to the booker at time of carrier selection. Screenshots are currently being developed.

302 General Given that the Russian / NATO transit agreement has been cancelled, shipment of military cargo to/from the Baltic states may not be possible. Are the Baltic rates still required? This question also applies to the Kyrgyzstan Linehaul

Linehaul rates are solicited to/from a door, with port being carrier's choice. If, at time of rate review, a particular port is not needed, the rate will be marked "no Government requirement".

303 Exhibit 1 Please advise if USTRANSCOM or SDDC can be used as one of the two contractors for the past performance questionnaires?

Contractors may send a past performance questionnaire to USTRANSCOM or SDDC as long as it's not sent to someone in the USTRANSCOM Acquisition Sealift Services Branch.

Exhibit 2

Cargo Claims This Section states that cargo claims will be processed in accordance with DTR Volume II Chapter

2. Under 3.F.1.6. the Carrier will provide a delivery receipt for the consignee to sign acknowledging the receipt of the cargo. In order to reduce the number of claims for missing -non delivered cargo, the US Military has to become a working partner in the Carrier's delivery of cargo. For Exigency areas, each US Military Base - FOB needs to file a daily report that lists the cargo received that day, can that be agreed to? The Carrier's name, container number and date of receipt needs to be listed on the report.

Since the bases/consignees do not work for SDDC, SDDC cannot compel them to prepare daily reports of deliveries.

Exhibit 2

Under Exhibit 2 Section 4 Cargo Claims, PWS Paragraph 3.F.6 or Exigency Annex, B.12 add the following: For Exigency areas, in addition to the Carrier's filing of a POD under PWS 3.F.1.6, the US Military Bases - FOBs will provide daily reports to the Carriers that list the Carrier's containers delivered to the Bases or FOBs the previous 24 hours. The report will be issued to each Carrier and will the container number (s), location and date of receipt.

Since the bases/consignees do not work for SDDC, SDDC cannot compel them to prepare daily reports of deliveries.

Exhibit 3, PWS 3.A.14.2

Chassis can only be provided with an associated ordered linehaul service. Chassis cannot be provided to outside (not carrier contracted) truckers and military operators as required by PWS. Carriers have asked that this requirement be removed. No carrier in international trade provides or can offer chassis commercially. Please remove this requirement from the solicitation. Can the government take commercial realities into consideration when formalizing requirements or provide a system of payment for the services required? This is currently under review.

307 Exhibit 3, PWS 3.A.14.2 Chassis cannot be provided as required by PWS, carriers have asked that this requirement be removed This is currently under review.

308 Exhibit 3, PWS, Attachment 7

1. Bunker Adjustment Factor (BAF)

Due to the new technical factors and rebaselining, the BAF payment has been eliminated under USC-8. Carriers must be allowed to add a commercial bunker increase to the ocean rate without fear of rejection as not fair and reasonable. Can the government provide guidance as to how bunker risk and payment will be approved and reviewed?

The Government understands the BAF language is a change from how it is currently calculated; however, all contractors proposing rates will operate under the same terms and conditions. All rates will need to be competitively bid, and the Government will evaluate them in accordance with FAR 15.404-1.

309 Exhibit 3, PWS, Attachment 7

1. Bunker Adjustment Factor (BAF)

Request reverting back to USC7 formula, i.e. 250 base line, no-rebaseline each year; the new proposed tech factors have essentially eliminated BAF; Is it the government's intention to eliminate bunker payments and/or compensation from the contract and can the USC-7 formula and base-lining be carried over into USC-8?

An independent party performed a study to develop the new technical factors. The agency sought for and considered information provided by Industry. The intent behind the study was not to eliminate BAF. Additionally, General Fraser issued a Memorandum directing the Acquisition Executive to rebaseline BAF annually.

Readjusting the fuel baseline to current market values reflects a sharing of fuel volatility risk between the Government and Industry.

Exhibit 2

2.1 2.1.1

Liability for Lost or Damaged Cargo. Application of COGSA for Government Owned Cargo There is a conflict in the language of Section 2.1.1. The 1st Paragraph states the limit of liability as set forth in Section 4 of COGSA shall apply to each package. The 2nd to last Paragraph refers to UNCITRAL and states the package limitation provisions shall stand in place of the COGSA limits.

The United Nations Commission on International Trade Law (UNCITRAL) Convention on the Carriage of Goods Wholly or Partly by Sea (the Convention) package limitation provisions shall substitute for, or otherwise stand in the place of the COGSA package limitation for the purpose of determining the limits of a Contractor’s liability for loss or damage to US Government cargo arising at any time in the custody of the Contractor. This raises the liability limitation from $500 per package to $925 per package. Language will be clarified in the next amendment.

Exhibit 2

2.1 2.1.1

There is a conflict in the language of Section 2.1.1. The 1st Paragraph states the limit of liability as set forth in Section 4 of COGSA shall apply to each package. The 2nd to last Paragraph states that the UNCITRAL package limitation provisions shall substitute or stand in place of the COGSA limits. Please revise and confirm that the Section 4 COGSA package limits apply from end to end.

The United Nations Commission on International Trade Law (UNCITRAL) Convention on the Carriage of Goods Wholly or Partly by Sea (the Convention) package limitation provisions shall substitute for, or otherwise stand in the place of the COGSA package limitation for the purpose of determining the limits of a Contractor’s liability for loss or damage to US Government cargo arising at any time in the custody of the Contractor. This raises the liability limitation from $500 per package to $925 per package. Language will be clarified in the next amendment.

Exhibit 2

2.1.2 Application of COGSA for Non- Government Owned Cargo Same conflict as 2.1.1.

The United Nations Commission on International Trade Law (UNCITRAL) Convention on the Carriage of Goods Wholly or Partly by Sea (the Convention) package limitation provisions shall substitute for, or otherwise stand in the place of the COGSA package limitation for the purpose of determining the limits of a Contractor’s liability for loss or damage to US Government cargo arising at any time in the custody of the Contractor. This raises the liability limitation from $500 per package to $925 per package. Language will be clarified in the next amendment.

Exhibit 2

2.1.2 Same Question - Request as 2.1.1. Can the government please clarify that COGSA limits apply end to end?

COGSA shall apply from the point of delivery to the Contractor to the point of delivery to the Consignee whether in connection with intermodal or ocean-only transportation under this Contract. Accordingly, COGSA shall apply in determining the limits of a Contractor’s liability, as set forth above, for loss or damage to cargo booked under this Contract arising at any time in the custody of the Contractor.

Exhibit 2

2.1.5

Increased Liability for Lost or Damaged Cargo. Provisions allowing the Shipper to declare the value of the cargo higher than COSGA liability limits and to order an increased value accessorial. Shipper must identify the type of cargo as well as select the higher value coverage.

Language will be revised in the next amendment. Cargo will be identified in IBS in accordance with current booking procedures. If a customer requires additional coverage for their cargo, tiered liability will be ordered and solicited via the one time only process. This will allow carriers to bid the tiered liability at the time the requirements are known.

Exhibit 2

2.1.5

Request that when the Shipper elects to utilize the Increased Liability Coverage provisions of 2.1.5 that it also identify the type of cargo being moved. The declaration of the type of cargo will assist the Carrier in initiating special steps and procedures appropriate to the type of cargo. How will the Increased Value Accessorial Process work? Will all Carrier rates be accepted?

Language will be revised in the next amendment. Cargo will be identified in IBS in accordance with current booking procedures. If a customer requires additional coverage for their cargo, tiered liability will be ordered and solicited via the one time only process. This will allow carriers to bid the tiered liability at the time the requirements are known.

Exhibit 2

2.1.5 Paragraph states the Carrier is liable up to the COGSA liability limits or the actual amount of the loss or damage whichever is less. Need to reconcile with the Paragraph 2.1.1. liability language.

The United Nations Commission on International Trade Law (UNCITRAL) Convention on the Carriage of Goods Wholly or Partly by Sea (the Convention) package limitation provisions shall substitute for, or otherwise stand in the place of the COGSA package limitation for the purpose of determining the limits of a Contractor’s liability for loss or damage to US Government cargo arising at any time in the custody of the Contractor. This raises the liability limitation from $500 per package to $925 per package. Language will be clarified in the next amendment.

Exhibit 2

2.1.5 TRANSCOM is directed to the different cargo liability limits and references in Paragraphs 2.11 and 2.1.5. Please confirm that the COGSA liability limits apply.

The United Nations Commission on International Trade Law (UNCITRAL) Convention on the Carriage of Goods Wholly or Partly by Sea (the Convention) package limitation provisions shall substitute for, or otherwise stand in the place of the COGSA package limitation for the purpose of determining the limits of a Contractor’s liability for loss or damage to US Government cargo arising at any time in the custody of the Contractor. This raises the liability limitation from $500 per package to $925 per package. Language will be clarified in the next amendment.

Exhibit 2

2.1.6

The paragraph states that the booking covers all cargo booked under a single PCFN and that the Carrier is liable up to the amount declared in the booking or the actual value of the cargo, whichever is less. Issue where the amount declared in the booking does not match Shipper provided documents. Lower value must prevail.

The contractor is liable to the shipper for lost or damaged cargo up to the amount declared in the booking, or the actual value of the lost cargo, whichever is less.

319 Exhibit 2 2.1.6

Where conflicts arise between the Shipper's declared value and the value set forth on the Shipper supplied documents, please confirm that the value or amount set forth on the Shipper supplied documents controls.

The contractor is liable to the shipper for lost or damaged cargo up to the amount declared in the booking, or the actual value of the lost cargo, whichever is less.

Exhibit 3, PWS

3,F.1.6 & 3.F.1.8.

Proof of Delivery Receipts and Contents. These requirements are impractical if not impossible to perform in Non- Exigency Areas. Delete the requirements for Non- Exigency deliveries. This is currently under review.

321 Exhibit 3, PWS

3,F.1.6 & 3.F.1.8.

Modify PWS Paragraphs 3.F.1.6 and 3.F.1.8 and limit the POD requirements to Exigency Areas. If not the Carriers will require all delivery locations to provide daily reports that list Carrier deliveries for the previous 24 hours. This is currently under review.

Exhibit 3, PWS 3.A.14.2 Requirement for the Carrier to provide Chassis for GFCs and port bookings. This is currently under review.

Exhibit 3, PWS 3.A.14.2

Throughout the USC-08 working sessions, the Carriers have advised TRANSCOM that chassis are no longer available or accessible to the Carriers. Delete the requirement carriers CANNOT perform. This is currently under review.

324 Exhibit 3, PWS 3.G.2

Recurring Service Failure Ability of TRANSCOM to secure services from another source and put the Carrier in a limited use status. Need to review - clarify.

The first part (using other sources) is a longstanding requirement from previous contracts. The second part (limited use) is clearly stated and limited to specific circumstances.

325 Exhibit 3, PWS 3.G.2 Request that TRANSCOM explain how this provision would be used.

Exhibit 3, PWS, paragraph 3.G.2.2 outlines the circumstances when a contractor may be put into limited use. If one of the circumstances arises, the Contracting Officer will obtain input from Government and Contactor personnel prior to making a determination.

326 Exhibit 3, PWS 3.G.4.1.1.1

Diego Garcia Lease Rates. The unilaterally imposed lease rates are unfair and do not provide adequate compensation to the equipment owners. Diego Garcia has a history of equipment damage, loss, delays, and poor equipment tracking and tracing. Can the government please remove lease rates from the contract?

Diego Garcia has a unique requirement. We are unaware of the history described and do not believe these concerns been brought to SDDC's attention.

327 Exhibit 3, PWS 3.G.4.1.1.1 Not fair and equitable lease rates. Must match existing detention rates.

Lease rates by their very nature are lower than detention rates. Carriers have repeatedly advised that when a requirement is known in advance that rates can be lower than detention rates.

328 Exhibit 3, PWS 3.G.4.1.4

Carriers agreed during discussions to reduce the Automatic Purchase day counts to 330 and 670 days, not to 125 days as proposed in the RFP. Is the government now reneging on previous agreements made in good faith?

The current replacement value is currently under review; however, the DOD will not pay more than the final container's replacement value per OSD's guidance.

Exhibit 3, PWS

3.G.4.1.4 -- 4.

The date the daily detention charges have reached the replacement value costs listed in PWS, The Government appears to be trying to impose a straight day count type container detention purchase stating that when the CD payments reach the 3.G.9 Replacement Value figure the Government owns the container. This was not agreed to by the Carriers. The Carriers agreed to the Optional Purchase provisions 60 days of CD payments and the Purchase Price if completed within the first 60 days or the Automatic Purchase when the Credit Against Purchase Price daily allowance reached the Container Purchase Price. The failure to pay detention and purchase price for the Optional 60 day purchase or the full CD payments for the Automatic Purchase is contrary to Industry agreements with TCAQ made in good faith.

The current replacement value is currently under review; however, the DOD will not pay more than the final container's replacement value per OSD's guidance.

330 Exhibit 3, PWS

3.G.4.1.6.1 Standard Container Detention

The Credit Against Purchase Price column is missing from detention table. Is the Government trying to change the container buyout provisions and eliminate the Credit Against Purchase Price allowance?

There is no separate credit against purchase column required. Since DOD will not pay more than the container's replacement value, every dollar of detention is credit towards to the purchase price.

Exhibit 3, PWS 3.G.4.1.7

Reefer Maintenance Object to the Government's attempt to add 10 additional days of Free Time for each compensable delay - staging evolution. The Government concurs. Exhibit 3, PWS, paragraph 3.G.4.1.7 will be amended.

Exhibit 3, PWS 3.G.4.1.7

Free time must be limited to 10 days per booking. Delete the language providing additional Free Time Cycles for each Compensable Delay or Staging event. Carrier could be required to provide endless Reefer Maintenance for Reefers and Gensets with no compensation. Object to the attempts to insert multiple free times which could give the government unlimited free time. This contradicts the Compensable Delay provisions of Exhibit 2, Section 6.

Can you please revise to clearly state multiple free time periods are not allowed or expected?

The Government concurs. Exhibit 3, PWS, paragraph 3.G.4.1.7 will be amended.

Exhibit 3, PWS 3.G.9.2

Purchase of Containers Delete the Optional transfer language. If the Government pays the Purchase Price or reaches the Purchase Price via CD payments, title for the container should automatically transfer to the Government. Why would the transfer of title be optional?

In some cases, the Government may elect not to purchase the container; however, detention will be capped at the replacement value of the container. If the Contractor has not been notified to pick up the empty container within 60 days of the date the container replacement value has been reached, title will transfer to the Government.

334 Exhibit 3, PWS 3.G.9.2

Delete the Optional transfer language. Insert - "If the Government pays the Purchase Price or reaches the Purchase Price via Container Detention payments, title for the container will automatically transfer to the Government." Carriers object to the government's unilateral establishment of purchase prices. Can the government please make these changes to ensure an accurate understanding of the terms and conditions?

As discussed with the carriers, the requirement has changed IAW OSD direction.

Exhibit 3, PWS, Attachment 6 A.7

Non-Exigency Area (sustainment) ordered services (OCF, Origin and Destination Linehaul, Liner Terms) with the exception of destination accessorial services shall be invoiced on Vessel Departure. Destination accessorial services shall be invoiced upon delivery.

Contractors may bill these accessorials on the final invoice if they so choose, even for an exigency area move

PWS,

Attachment 6 A.8

Payments - Exigency Areas The Paragraph states the "Contractors are authorized to bill for all charges on Vessel Departure in Exigency Areas. Carrier proposes segregating performance type accessorials like Tarping, Washing and CENTCOM ordered items such as Outer Routing and EITV for payment after performance.

Contractors may bill these accessorials on the final invoice if they so choose, even for an exigency area move

Exhibit 3, PWS, Attachment 6

A.8

Change Paragraph A.8 to read: Contractors are authorized to bill for Ocean Freight, Line Haul charges, BAF, CAF and FAF adjustments upon vessel departure in Exigency Areas. Accessorials such as Tarping, Washing, etc. and CENTCOM directives such as Outer Routing and EITV will be billed by the Carrier after performance and the Carriers' verifications - certifications of service.

Contractors may bill these accessorials on the final invoice if they so choose, even for an exigency area move

Exigency Annex

B.1

Mandatory Acceptance of Bookings - Carriers must accept Mandatory Bookings. 14 Day Counter to the RDD permitted. Issue regarding the Mandatory acceptance of GFCs above 200 containers per sailing. Issue of the disruption to the Carrier's business, lack of detention revenue to compensate the Carrier for the daily reporting requirements , in theatre management of the GFCs, etc.. Proposed 5% surcharge does not properly compensate the Carrier. . This is currently under review.

Exigency Annex

B.1

Is there a limit or ceiling to the number of Mandatory Bookings a Carrier must accept? With respect to GFCs is there a limit per vessel, booking? The proposed 5% surcharge after the first 200 GFC containers does not represent fair and equitable compensation to the Carrier. The Carrier is exposed to severe service and business disruptions and is expected to manage and provide daily reporting on the GFCs in theatre with no revenue contribution to the Carrier's direct management or overhead costs. Increase the surcharge to 50% of OCF and acceptance above 200 at carrier's discretion. This is currently under review.

340 Exigency Annex

B.4. and B.5.

Attachment 1

Staging Paragraph B.4 states the Carrier must be cognizant of delays in dispatching from the CY and file a dispatch plan with the COR if all the staged containers cannot be dispatched within 5 days. Please clarify question.

341 Exigency Annex

B.4. and B.5.

Attachment 1

With the Carrier's submission of the Dispatch delay report, the COR will need to adjust the End of Staging Order.

See Attachment 1, specifically the HR reporting discussions. Please confirm this process. Please clarify question.

342 Exigency Annex B.7.5 Driver Wait Time Carrier must file a report with the COR documenting in transit compensable delay. Driver wait time applies only at gate of destination, not in transit.

Exigency Annex

B.7.5 Can the Carrier utilize the Contract rate of $150 per day for In Transit Driver Wait Time? This would serve to streamline the REA process.

Driver wait time applies only at gate of destination, not in transit. Any in transit delays will continue to be handled through the Request for Equitable Adjustment process.

344 Exigency Annex C.3.

EITV Review for the ability to perform and accomplish. Government must provide timely notices of pinging -reporting issues so the Carrier can address or correct.

Please clarify question. This sounds like a matter of improving Government / carrier communication verse a PWS matter.

Exigency Annex

C.3.

It is critical that the US Government provide timely notice to the Carrier and identify EITV tracking - reporting issues and non receipt of data. Without regular government feedback carriers cannot operate utilizing the proper customer/carrier checks and balances.

Please clarify question. This sounds like a matter of improving Government / carrier communication verse a PWS matter.

Exhibit 3, PWS

Sections 3.F.1.6 and 3.F.1.8 concerning proof of delivery receipts

Required Proof Of Delivery Receipts are not available outside the Exigency Area. This is a unique military requirement that cannot be performed in the commercial environment. This is currently under review.

Exhibit 3, PWS, Attachment 7 1.2

Please provide an example of the new bunker baseline number and explain how it is calculated.

The baseline will be based on the average fuel price of Feb, Mar, and Apr. Based on feedback received from Industry, there will be a baseline per lane. This revision will be incorporated in the next amendment.

PWS,

Attachment 7

Attachment 7, 1.2

The RFP states that the baseline fuel price shall be based on the average of the fuel price of the 3 months prior to the issuance of the RFP, which are Feb, Mar and Apr, and should already be calculable at this point. Can you please provide that calculation and starting point number? Additionally it is not totally clear how various grades of fuel treated.

For example: the BAF Table (1.3) for Route 1 (Los Angeles) indicates “High Sulfur Bunker Share” at 84% and “16% ECA Share (low sulfur)” which would seem to indicate we would average the price of the two fuel types.

However, when we refer to paragraph, 1.4.4 which deals with fuel prices, it refers to three fuel types, IFO 380, Ultra Low Sulfur, and MGO which “shall be averaged to calculate monthly average fuel prices” .

There seems to be conflict/confusion among all the terms (bunker types) here: two types in table and three types in pricing section. Please advise which grade’(s) prices should be utilized for purposes of calculating price numbers in accordance with the headings in the BAF Table.

The baseline will be based on the average fuel price of Feb, Mar, and Apr. Based on feedback received from Industry, there will be a baseline per lane. This revision will be incorporated in the next amendment.

Exhibit 3, PWS, Attachment 7

Attachment 7,

1.2 please advise if there are going to be lane-by-lane baselines

There will be a baseline set for each lane. Exhibit 3, PWS, Attachment 7 will be revised in a future amendment.

Q&A #6

Alaska Tradelane

To confirm then that the Ocean rate USWC to Alaska in reality is Puget Sound to Anchorage with the ability to add on "Linehaul" charges for further movement to Kodiak and/or Dutch Harbor Alaska. Currently the RDC-6 Offers Ocean Puget Sound to Dutch Harbor and Kodiak is added as a "Linehaul" charge to the Puget Sound to Anchorage Ocean container rate. Similar should be offered in the USC-8 for utilization of these service options. Not to be limited to Anchorage only.

Exhibit 3, paragraph 6.A.1 will be amended so ocean rates from US West Coast to Alaska for containers will be port-specific just as they are for Breakbulk. This principle will apply to Route 1B (Hawaii-Alaska), 26 (West Coast-Alaska), and 29 (Alaska Interport). Ocean rates for all other routes will be to Alaska as a whole. As a result of this change, the requirements for linehaul rates for Kodiak will be deleted from the CARE II SM.

Exhibit 3, PWS, Attachment 6

6.A.1.

To lump all Alaska ports into one rate line "Alaska" is unworkable. The ports in Southeast Alaska, Central Alaska and Western Alaska/Aleutians are serviced by entirely different vessels, voyages and routes. A competitive rate to Anchorage would not cover Carriers cost to Dutch Harbor and would be well above the market to Ketchikan.

Even within an area like Southeast Alaska one size rate does not fit all. Barge transportation rates vary greatly by distance. A Juneau rate that is competitive and compensatory is not the correct rate and would be overpriced for cargo to Ketchikan. as far as drayage from Anchorage is concerned most other Alaska destinations have no land connection at all to Anchorage. The custom of the trade is definitely to have different rates to at least Anchorage, Kodiak, Cordova, Dutch Harbor, Valdez, Ketchikan, Sitka, Juneau, Petersburg. You have many of the needed origin/destination pairs in the Ocean Breakbulk rates, but for container rates you lump it all into "Alaska". If there is only Alaska as a destination, we have no choice but to charge the highest rated destination for all locations.

This does not serve the Government well. Multiple Carriers have now pointed out this issue. Will the Government reconsider and seek rates appropriate to the vastly different regions and ports of Alaska?

Exhibit 3, paragraph 6.A.1 will be amended so ocean rates from US West Coast to Alaska for containers will be port-specific just as they are for Breakbulk. This principle will apply to Route 1B (Hawaii-Alaska), 26 (West Coast-Alaska), and 29 (Alaska Interport). Ocean rates for all other routes will be to Alaska as a whole. As a result of this change, the requirements for linehaul rates for Kodiak will be deleted from the CARE II SM.

Attach 6 Overall

Will there be a phased approach to use this process first beginning with invoices that are manually paid today versus immediately moving away from a proven Third Party Payment System (TPPS)?

US Bank Additional comment for consideration.

While we understand the proposal to remove the TPPS for the current IBS category, a better strategy for USTC and SDDC would be to convert your existing paper payment processing for Ocean payment areas ie: Inbound, BreakBulk and OConus into the new, untested TFMS process that is specified within the new RFP. This would allow you to ensure all payment actions occur as you've described within the RFP without impacting the current Outbound container traffic that TPPS pays.. Permitting this option would allow you to phase in paper payments as IPP is rolled out. Once the concept is working as desired then move the outbound container traffic to IPP.

As a trusted partner we understand the governments desire to move payments to IPP but want to assist in making this transition smooth for the carrier community.

This option will be considered as we finalize our plans for IPP implementation for the USC-8 contract.

353 Exhibit 1 b.1 Technical Proposal - In addition to items noted, what else are you looking for in the technical proposal?

Exhibit 1, 52.212-1, paragraph (b.1)(3) provides what is required in the Volume II - Technical Proposal submission.

Exhibit 3, PWS, Attachment 7

BAF

In BAF/CAF/FAF rules, it states: BAF applies the month the vessel departs the load port at the time of booking shall determine the month for calculation of BAF charges." - What about new Ocean rates and linehauls when the new contract goes into effect? What is the policy for USC8 in this regard?

In accordance with Exhibit 3, Attachment 7, paragraph 1.4.2, the average price shall be calculated on or after the first of the month for the prior month and shall apply to shipments booked for sailings in the next month.

Exhibit 3, PWS, Attachment 3

Rate Rules It appears that language has been clarified to the extent Mileage rates are always applied when available before a derived (percentage) calculation process is used to make up a missing rate. Is this correct? Yes. Derived rates are used only when a non-derived rate is not available.

356 Exhibit 1 b.1 Technical Proposal - Reference to Routes is removed.

Unlike previous contracts, carriers are no longer required to identify the routes they can provide service on.

357 Exhibit 3, PWS

3.G.4.1.6

Detention rates at $22 per day has not been updated in over a decade and the buy out process continues to force Carriers into being penalized for the Military's inability to manage equipment. This buy out process should be incentivized to encourage the Military to return equipment in a timely manner. What effort is the Military willing to consider to stop buying containers and find other means to resolve their detention problem?

The Government is constantly reviewing internal processes to make improvements in the container management process. However, the Government still requires the ability to purchase containers in the event that they can not be returned by shippers.

Exhibit 3, PWS, Attachment 6 A.2 How are Carriers to bill Direct Booking Customers? Will this be detailed in an amendment?

The processes associated with direct booking remain unchanged from RDC-6 and USC-7 for now.

Exhibit 2

2.1.5 Will the Increased Liability Accessorial be limited to Non Exigency areas?

Language will be revised in the next amendment. If a customer requires additional coverage for their cargo, tiered liability will be ordered and solicited via the one time only process. This will allow carriers to bid the tiered liability at the time the requirements are known. This language will apply to exigency and nonexigency areas.

360 Exhibit 3, PWS 3.A.12

Why was the RDD table removed? Without it, workload will be increased by having to counter an increased amount of unrealistic RDD's.

IBS is programmed to avoid unrealistic RDDs. If a carrier receives an offer that they feel is unrealistic (as opposed to ambitious), this should be brought to SDDC's attention.

361 Exhibit 3, PWS 3.H Accessorials

References to CARE have been replaced with "Rate Guide". If Rate guide is found to be in error, will Carriers be able to use CARE as evidence of actual rate input?

If there is a discrepancy between the Rate Guide and a rate awarded in CARE, this should be brought to the Contracting Officer's attention.

PWS

3.H & 3.H.1.3.1

There is a MINI STOP OFF Accessorial in the CARE Requirements, yet there is also charges for mini stops in the PWS. When does the accessorial apply that we put in CARE? "3.H.1.3.1 A "per container" stop-off charge of $150 CONUS and $225 OCONUS shall be paid for each stop off. A mini-stop will be paid at the rate of $50 CONUS and $100 OCONUS. " "Accessorial services, when ordered by the Ordering Officer, and actually provided by Contractor, shall be paid in accordance with the Contractor’s established rate in the Rate Guide, or at the Government-set rate if applicable."

Carriers do not need to offer a rate for Mini Stop-Off. As for a regular Stop-Off, this is a Government set rate. The contract has a variety of Government set rates which appear in CARE so the Booking office can order them when needed.

Exhibit 3, PWS

3.F.1.2

While we understand the requirement to notify cognizant SDDC office and consignee for port deliveries to a commercial port, it does not make sense and only causes confusion to notify the consignee when it is a military terminal. The SDDC personnel at the military terminal is the appropriate party to notify the consignee as they do the coordination of the delivery under their CULT contract. Please revise clause to state that only notification to the SDDC cognizant party and not the consignee is required for port delivery to military terminals.

If the to-port booking is on free-out terms, the PWS will be amended to not require this notification.

Exhibit 3, PWS, Attachment 3

1.2.3 Extra Length charge - We note that this paragraph has been amended to make this charge only applicable to general cargo. The genesis of this clause many years ago was because there is added time and expense in loading an unusually long piece whether it is general cargo or a vehicle. For example it is much more difficult, costly and time consuming to load an 80 foot vehicle vice two 40 foot vehicles. You often need special equipment to raise the back wheels so you do not bottom out when you are clearing the crest of the ramp. This is the reason the clause was inserted years ago and we see no valid reasons for USTC to now eliminate it.

Extra Length was never intended to apply to vehicles, but previous language was not sufficiently clear. Extra Length is intended for General cargo (e.g. Telephone Pole) of an unusual shape and dimension and which might have low Mtons, so additional compensation is justified beyond the standard MTon basis. Long vehicles have high MTons, so the MTon-basis provides sufficient compensation. Carrier is free to take this into account when offering rates or (as has occasionally occurred) reject bookings for cargo whose rate it deems noncompensatory.

Exhibit 3, PWS, Attachment 3 1.2.5

We note that the inoperable vehicle charge has been deleted. We had been asked during the I-SAW to come up with a more realistic compensable rate for this service which we provided and now see that has been deleted instead of decreased. We find no rationale for this as carriers incur an additional expense to move an inoperable vehicle either via towing or dragging the vehicle on. Alternatively all of these items should be booked as general cargo. Please provide the rationale for deleting this valid compensation.

The movement of vehicles, operational or inoperable, are covered under Liner Terms.

Exhibit 3, PWS, Attachment 6

A.5 The sentence "The Government has the right to request additional information in support of the charges in the invoice." is too broad of a term with no limits - The contract already details what support is needed so request that this sentence be deleted.

The government reserves the right to request clarification or additional information to determine entitlement. This does not mean we will be asking for different artifacts, rather we may need some additional information or clarification in regards to documentation provided.

Exhibit 3, PWS, Attachment 6

A.7-A.9

A.7 states that contractors are authorized to bill for Liner Out upon vessel departure. A.9 states that invoices shall not be submitted by the Contractor until the required EDI transaction pertaining to the billed service has been submitted. Please confirm that vessel arrival is not needed to bill Liner Out and only vessel departure as per A.7 is required. Confirmed. Liner In and Liner Out can be billed at vessel departure.

Exhibit 3, PWS, Attachment 6

B.3 Proper Invoice states that it needs Delivery Date /Proof of Delivery. Please advise if proof of delivery is anything in addition to the required EDI transactions. Otherwise this is an impossible administrative burden on the carriers and not realistic. The Government will use the carrier X1 data for the carrier proof of delivery.

Exhibit 3, PWS, Attachment 7

BAF

We note that the Government has maintained that the BAF will be reset annually but did not change the technical factors from the previous draft. Part of the negotiations in USC-7 was that the carrier assumed less risk because the baseline did not change. Therefore the risk factor portion of the technical factor was reduced. Now the baseline changes every year, but yet the technical factors are drastically reduced from USC-7. This is inconsistent.

The carriers as a group provided details on our vessels in regards to the VOLPE study, but the tech factors are unchanged from the first draft. One route that is key to our service is Route 01 and the technical factor has been decreased by 1,636% from USC7 and the baseline is reset. We do not see how the Government can find a reduction of 1,636% reasonable or equitable.

An independent party performed a study to develop the new technical factors. The agency sought for and considered information provided by Industry. The intent behind the study was not to eliminate BAF. Additionally, General Fraser issued a Memorandum directing the Acquisition Executive to rebaseline BAF annually.

Readjusting the fuel baseline to current market values reflects a sharing of fuel volatility risk between the Government and Industry.

Exhibit 2 2.1.3 Where does UNCITRAL apply in relation to COGSA? In USC-07, the clause read that UNCITRAL would apply upon Senate approval - is that still the case? Is the conversion to UNCITRAL still pending? The United Nations Commission on International Trade Law (UNCITRAL)

Convention on the Carriage of Goods Wholly or Partly by Sea (the Convention) package limitation provisions shall substitute for, or otherwise stand in the place of the COGSA package limitation for the purpose of determining the limits of a Contractor’s liability for loss or damage to US Government cargo arising at any time in the custody of the Contractor. This raises the liability limitation from $500 per package to $925 per package. Language will be clarified in the next amendment.

Exhibit 2 2.1.4 Clause ends with "This recovery is limited to the amount paid for the services by the Government." What is the definition of "services" in this case? (It is referring to transportation costs AND enhanced ITV/enhanced security.

Kindly request clarity to this clause. This is currently under review.

Exhibit 2 2.1.5 The "Increased Liability" accessorial provisions have not been provided to carriers for review prior to the Final RFP. Because the accessorial is to be input into the rate guide for each liability ceiling, without consideration for POE/POD or routing, and applies the ceiling to an entire "booking", We need additional time to analyze this provision. We has also reached out to its P&I insurer to determine whether this approach is feasible from an insurance perspective. Considering the issues above, and the complexities of this liability regime as applied to a global contract, we request additional time to analyze this provision.

Language will be revised in the next amendment. If a customer requires additional coverage for their cargo, tiered liability will be ordered and solicited via the one time only process. This will allow carriers to bid the tiered liability at the time the requirements are known. This language will apply to exigency and nonexigency areas.

Exhibit 2 6 & 7 We are looking to confirm that the clauses in these paragraphs are superseded by those instances in which standard, Attachment 6 invoicing is relevant. Language does seem to indicate this in section 6, therefore only looking to confirm This is currently under review.

Exhibit 3, PWS, Attachment 1

Additional Rules for AV Transaction

Does the term "requested" infer that we will have to begin using the AV option within DRAP for Door moves in Exigency Areas. Today in Afghanistan and Pakistan only we Auto Trigger AV. AV is to be used only when truck is physically at gate of consignee base in an

Exigency area. It is not to be used under any other circumstances.

Exhibit 3, PWS, Attachment 1

RA Event Is it anticipated that all USG facilities will be required to submit an RA event for all empty notifications? Manual notification of empty container status is being phased out. See Exhibit 3, paragraph 3.G.4.1.5. Ultimately, all notifications will be done via a container return management module.

Exhibit 3, PWS, Attachment 6

A.2 Will COR continue to certify Direct Booking, after which carriers are to invoice the costs directly to the Direct Bookers? Today IPP submissions handle Direct Booker shipments, and invoices outside IPP for DB's are routed through G8, and appropriate COR certifies, then DB makes payment. Will this continue? Yes, the CORs will continue to certify direct booking invoices.

Exhibit 3, PWS

3.A.6 With regard to Schedule Maintenance, due to the number of ocean routes for us, the schedule maintenance requirements in Section 3.A.6.1 requiring the carriers to maintain and update regular vessel schedules in IBS at least 45 days prior to sail date will be overwhelming. We recommend that these schedule maintenance requirements be limited to P1 and P2 service (with schedules relevant to P3 updated as bookings become available.)

The Government is only soliciting 1003 ocean rates in the CARE II SM, which represents about 200 distinct routes (keeping in mind that major routes have 8 separate rates on the same lane). Since no carrier serves all lanes, at most only about 150 schedules will need to be maintained. The auto-feed feature under development will address this concern.

Exhibit 3, PWS

3.A.6 & 3.A.7 Contract requests inclusion of all global schedules into IBS. This is an exceedingly burdensome requirement with which we non-concur, and there would be concern that the immense data would adversely impact USM systems.

Request that this requirement is stricken / left to existing USC-07 expectations.

The Government is only soliciting 1003 ocean rates in the CARE II SM, which represents about 200 distinct routes (keeping in mind that major routes have 8 separate rates on the same lane). Since no carrier serves all lanes, at most only about 150 schedules will need to be maintained. The auto-feed feature under development will address this concern.

379 Exhibit 3, PWS

3.A.12 Clauses understood, however we request a standardized approach from the global CORs with regard to DRAP / BRT requirements, as in the current environment there are differing expectations geographically that have become difficult to manage procedurally. Business rules are being developed to standardize processes.

PWS

3.A.14.2 As discussed during the USC-08 SAW, carriers no longer own chassis and so they are required to lease chassis from third parties. It was discussed whether chassis costs would be billed as a straight pass through as carriers cannot predict how long chassis will need to remain available to USC shippers while remaining in Container Pools;

and during which time, carriers will incur out-of-pocket leasing costs. As a result, we disagree with the statement in 3.A.14.2 that, "This $45 or $80 fee shall not apply to Contractor-provided chassis at locations where Contractor has established a Container Pool IAW 3.A.15 even if the container/chassis combination is used for a from-port booking.'' To the contrary, we recommend that the $45/$80 chassis fee be payable on each chassis remaining in a Container Pool in excess of ten (10) days, and payable on each ten (10) day increment during which the chassis remains in the Container Pool. Carriers would notify the USC Contracting Officer of the initial chassis availability to begin the relevant time period, and would report the incurrence of each $45/$80 usage fee at regular intervals thereafter. This would minimize the costs borne by the Government, as USC carriers would not be required to price in unknown/unpredictable chassis costs into USC-08 rates.

This is currently under review.

Exhibit 3, PWS

3.F.1.2 Proposal: We request language to be added…