[Federal Register: December 15, 2006 (Volume 71, Number 241)]
[Notices]
[Page 75509-75511]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr15de06-37]
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DEPARTMENT OF DEFENSE
Department of the Army
Mandatory Provision of Full Replacement Value Coverage by
Department of Defense Personal Property Transportation Service
Providers (TSPs)/Contractors
AGENCY: Department of the Army, DOD.
ACTION: Notice.
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SUMMARY: Pursuant to Chapter 157, Sec. 2636a of Title 10 United States
Code enacted by Congress on November 26, 2003, as amended by the
Department of
[[Page 75510]]
Defense Authorizations Act for FY 2007, the Military Surface Deployment
and Distribution Command (SDDC), as the Traffic Manager for Department
of Defense (DOD) Personal Property Program, is informing the
Transportation Service Provider (TSP)/contractor community of the
mandatory requirement to provide Full Replacement Value (FRV) coverage
to all customers of the DOD Personal Property Program. The cost of FRV
shall be included in contracts with movers and FRV shall be made
available to Service members and civilian employees.
All shipments that have been picked up or are already in storage
prior to the effective dates noted below will not be required to be
covered by FRV. This notice affords TSPs/contractors ample time to
incorporate the cost of providing FRV for loss/damage protection into
their rates.
DATES: Effective Dates: There are two scenarios for the implementation
of Families First and the cost of the new program to include FRV.
1. The Defense Personal Property System (DPS) has a notional
implementation timeline that may partially implement the new Families
First (FF) program to include FRV in May 2007 to some customers moving
under the DoD Personal Property Program for shipments in the dHHG, iHHG
and iUB markets (excluding NTS, DPM and ITT). FF/FRV should be fully
implemented to the remaining customers under this notional timeline by
November 2007. This schedule is dependent upon successful Software
Acceptance Testing (SAT). If SAT is successful, rate filing to support
this timeline will occur during March 2007 for all TSPs. If SAT is not
successful, and DPS is not implemented under this notional timeline,
FRV will be implemented to all DOD customers as indicated in the
``effective dates'' below. It is necessary for all TSPs to file rates
under the current program in the event DPS is not implemented as
planned.
2. Current Program Implementation: The cost for FRV coverage shall
be included in all rates for the International Household Goods (iHHG)
program, the Unaccompanied Baggage (UB) program, the Domestic Household
Goods (dHHG) program, Intra-Theater Tender (ITT) program, Non-Temporary
Storage (NTS) program, and the Direct Procurement Method (DPM) program
according to the following schedule:
For the international household goods (iHHG) program and
unaccompanied baggage (UB), rates filed for the International Winter
2007 (IW07) rate cycle shall include the cost of providing FRV coverage
for all shipments picked up on or after October 1, 2007.
For the domestic household goods (dHHG) program, all rates filed
for the Domestic Winter 2007 (DW07) rate cycle shall include the cost
of providing FRV coverage for all shipments picked up on or after
November 1, 2007.
For the Intra-Theater Tender (ITT) program all rates effective on
or after April 1, 2008 shall include FRV coverage.
For the Non-Temporary Storage (NTS) program, shipments ordered with
a date on or after March 1, 2008 shall include FRV coverage. New rates
that include the cost of providing FRV must be postmarked between
December 16, 2007 and January 15, 2008.
All DPM contracts will be amended to require the provision of FRV.
Contracts having one or more years remaining on March 1, 2008 will be
modified to include the provision of FRV at the stated limits.
Contracts which are due to expire within one year of March 1, 2008 will
not be amended to require FRV. The follow-on contracts will include the
provision of FRV at the stated limits.
ADDRESSES: Requests for additional information may be sent by e-mail
to: FRVComments@sddc.army.mil; or by courier to: Military Surface
Deployment Distribution Command, ATTN: SDDC-PPP, Room 10S67-31, Hoffman
Building II, 200 Stovall Street, Alexandria, VA 22332-5000.
FOR FURTHER INFORMATION CONTACT: Mr. Charles Helfrich, (703) 428-2996.
SUPPLEMENTARY INFORMATION: FRV coverage shall be provided at the
following limits: If a claim is filed directly with the TSP/contractor
within none (9) months of delivery, then the TSP's/contractor's maximum
liability on each HHG and UB shipment will be the greater of: (1)
$5,000 per shipment; or (2) $4 times either the net weight of the HHG
or $4 times the gross weight of the UB, in pounds, not to exceed
$50,000. Certificate of Cargo Liability Insurance/Certificate of
Warehousemen's Liability Insurance must also reflect the new FRV
limits. The TSP/contractor must report settled claims information to
SDDC within seven calendar days of claims settled.
Implementing guidelines and procedures covering liability for loss/
damage along with the claims process can be found on SDDC's Web site:
http://www.sddc.army.mil (HOT ITEMS/Full Replacement Value).
Background
Chapter 157, Title 10 U.S. Code Sec. 2636a, also known as The Full
Replacement Value Act of 2003, was passed on November 26, 2003. This
law amended (in part) chapter 157 of title 10 by inserting after
section 2636 a new section 2636a entitled, ``Loss or damage to personal
property transported at Government expense: Full replacement value;
deduction from amounts due TSPs.'' This law allows the Secretary of
Defense to include a clause for full replacement value in contracts
with TSPs. It also allows a deduction of the FRV from the amount due to
a carrier if the carrier fails to settle.
The FRV Act allowed for immediate inclusion of FRV into the
Personal Property Program, but SDDC decided to delay FRV to coincide
with the rollout of the reengineered future Personal Property Program
known as Families First. Current uncertainty surrounding the actual
roll-out date of Families First and the Defense Personal Property
System (DPS) has caused Congress and SDDC to decide to implement FRV
into the current Personal Property Program.
In June 2006 the Senate Arms Services Committee published the
following recommendation:
``Subtitle C--Travel and Transportation Allowances
Expansion of payment of replacement value of personal property
damaged during transport at Government expense (sec. 631)
The committee recommends a provision that would amend section 2636a
of title 10, United States Code, to require the Secretary of Defense,
no later than March 1, 2008, to include in contracts for the
transportation of baggage and household effects for military members
and civilian employees a clause requiring the carrier to pay the full
replacement value for loss or damage. The provision would also require
certain certifications by the Secretary about, and a review and
assessment by the General Accountability Office on December 1, 2006,
and June 1, 2007, of the ``Families First'' program.
The committee believes that the time is past due for implementing
the contractual authority requested by the Department in 2003 and
included in section 634 of the National Defense Authorization Act for
Fiscal Year 2004 (Pub. L. 108-136). Military personnel and their
families have waited long enough for realization for the Families First
promise of full replacement value for household goods lost and damaged
by movers in connection with permanent changes of station.
The committee has concluded that implementation of the full
replacement standard for both military members and civilian employees
by means of
[[Page 75511]]
contractual changes with TSPs must precede implementation of the
Defense Personal Property System (DPS) under the Families First
program.''
Regulation Flexibility Act
This action is not considered rulemaking within the meaning of
Regulatory Flexibility Act, 5 U.S.C. 601-612.
Paperwork Reduction Act
The Paperwork Reduction Act, 44 U.S.C. 3051 et seq., does not apply
because no information collection or record keeping requirements are
imposed on contractors, offerors or members of the public.
Steven L. Amato,
Colonel, U.S. Air Force, DCS, Passenger and Personal Property.
[FR Doc. 06-9729 Filed 12-14-06; 8:45 am]
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