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Barry McVay's FEDERAL CONTRACTS DISPATCH

DATE: July 21, 2000

FROM: Barry McVay, CPCM

SUBJECT: Military Traffic Management Command (MTMC); Freight Transportation Procurement Procedures

SOURCE: Federal Register, July 21, 2000, Vol. 65, No. 141, page 45362

AGENCIES: MTMC, U.S. Army, Department of Defense (DOD)

ACTION: Notice and Request for Comments

SYNOPSIS: MTMC often procures transportation services using contracting procedures that are not governed by the Federal Acquisition Regulation (FAR). Because of changes in the governing law, MTMC proposes to use the FAR (including its format, provisions, and clauses) to procure transportation services involving recurring shipments or long term contracts with motor carriers and barge operators.

DATES: Submit comments on the proposal by September 19, 2000.

FOR FURTHER INFORMATION CONTACT: Submit comments to Headquarters, Military Traffic Management Command, ATTN: MTAQ Room 12N67, Hoffman Building II, 200 Stovall Street, Alexandria, Virginia 22331-5000.

SUPPLEMENTAL INFORMATION: Historically, freight transportation services procured by MTMC have not been governed by the FAR. FAR 47.000, Scope of Part, states "the FAR does not regulate the acquisition of transportation or transportation-related services when when the bill of lading is the contract." Government bills of lading (GBL) rates were governed by 49 U.S.C. 10721 (see FAR 47.104, Government Rate Tenders Under Section 10721 of the Interstate Commerce Act). However, the Interstate Commerce Act has been substantially amended in recent years, most notably by the Trucking Industry Reform Act of 1994, which abolished tariff filing requirements for motor carriers of freight, and by Public Law 104-88, the ICC Termination Act of 1995, which abolished the Interstate Commerce Commission (ICC). What remains of Section 10721 (which has been scattered throughout Title 49 of the U.S.C.) has no practical application to the freight service DOD acquires from carriers (see Munitions Carriers Conference, Inc. v. United States, 147 F.3D 1027 (1998).

Therefore, MTMC is proposing to procure future transportation services involving recurring shipments or long term contracts under the FAR, including procurements based on, or similar to, the guaranteed traffic (GT) agreements that MTMC now utilizes under FAR exempt procedures. However, this proposed change would not apply to the current household goods program, which is covered by different laws (though some household goods transportation contracts are already being conducted under the FAR), and MTMC will continue to use a voluntary tender procedure for shipments not covered under a long term contract since those GBL-based movements continue to be recognized as exceptions to the legal requirement to use the FAR.

FOR FURTHER INFORMATION CONTACT: Barry McVay at 703-451-5953 or by e-mail to BarryMcVay@FedGovContracts.com.

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