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Interim Internal Purchasing Guidelines > 4 Purchasing > 4.4 Mail Transportation Purchasing
4.4.1.a Applicability. Mail transportation purchasing is the purchase of mail
transportation and related services. This section addresses the purchase of
mail transportation services authorized in Part V of title 39, U.S. code, and
those authorized under applicable provision of 49 U.S.C. 41904. It also
addresses the purchase of ancillary services directly related to the
transportation of mail.
4.4.1.b Purchasing Method. Generally, and depending on the item being purchase,
mail transportation is purchased following the policies and procedures
contained in 4.2. In case of any conflict between this section and other
sections of these guidelines, the provisions of this section govern.
Administrative officials are Postal Service officials designated by a
contracting officer to supervise and administer a supplier's performance of
mail transportation and related services. Officials so designated do not have
the authority to make contract changes as described in 4.4.3.
4.4.3.a Designation. A contracting officer may designate, by name and position title,
Postal Service employees to serve as contracting officers' representatives
(see 1.4.3 and 6.1.1.b). These individuals are authorized to take actions
related to the award and administration of specified contracts. Designations
must be in writing and must clearly specify the contracts or types of contracts
over which the contracting officer's representative has delegated authority.
Designations remain in effect until:
1. Revoked by the contracting officer or the contracting officer's
successor; or
2. Revoked by the departure or reassignment of the individual designated.
1. A contracting officer's representative is authorized to:
(a) Review and grant contract adjustments when the annual
compensation paid under the contract will not increase or
decrease by more than 10 percent.
(b) Discuss, approve, and sign orders and contract modifications
changing service schedules, provided that the annual
compensation paid under the contract will not increase or
decrease by more than 10 percent; and
(c) Review and sign contract modifications having no effect on cost
or price.
2. A contracting officer's representative may not award, agree to, or sign
any contract or, except as authorized in subparagraph 1 above, any
contract modification or termination notice. Only contracting officers
have such authority.
4.4.3.c Restrictions.
1. They must be employed in the Executive and Administrative Schedule
or the Postal Career Executive Service.
2. They may not redelegate their authority. They may, however, assign the
performance of administrative tasks to their subordinates.
4.4.4.a Establishing Mailing Lists. The Postal Service prequalifies suppliers to the
greatest extent practicable (see 3.5.2). If suppliers have not been
prequalified, the contracting officer, working with the purchase team, must
establish a list of potential suppliers for each solicitation, and maintain lists of
potential suppliers for services solicited on a recurring basis. Suppliers
wishing to be included on the national mailing list may apply by submitting
Form 5436, Mailing List Application - Mail Transportation Services, or by
letter providing the information required by the purchase team.
4.4.4.b Retention on Lists. Suppliers must be retained on mailing lists for 2 years
from the date of their application or the date of their most recent response to
a solicitation, which ever is later. Those that have been removed from mailing
lists may be reinstated by filing a new application.
4.4.4.c Use of Mailing Lists. The purchase team, using its knowledge of the
marketplace and depending on the particular purchase, should solicit enough
mailing list suppliers to ensure adequate competition.
4.4.4.d Publicizing. The contracting officer may have an announcement of the
solicitation published in the Journal of Commerce. Announcements of
solicitations may be made available to newspapers, other news media, and
trade journals at no cost to the Postal Service. Paid commercial
announcements or advertisements may be used when determined by the
contracting officer to be in the Postal Service's interest. Unless precluded by
urgency, any announcement must appear at least 30 days before the date for
receipt of proposals.
4.4.5.a Contract Type. See 2.4.
4.4.5.b Contract Term. Except for air and terminal-handling contracts, the term of the
contract must be one of the following:
1. Regular Contract. A fixed-term contract that cannot exceed 4 years
unless warranted by special conditions or the use of special equipment.
In these cases, the contract may be for a 6-year term.
2. Emergency Contract. A contract entered into for the duration of an
emergency under the authority of 39 U.S.C. 5001.
3. Temporary Contract. A short-term contract that may not exceed 2
years, and that may be terminated by either party without entitlement or
indemnity.
1. Regular contracts should be used whenever possible.
2. Temporary contracts may be used only when (a) the need for the
service is expected to be 2 years or less, or (b) the need for the service
has been established, but the duration, frequency, or volume of mail are
not certain. Temporary contracts must be replaced with regular
contracts as soon as service requirements are firmly established.
3. Emergency contracts may be entered into only when an emergency
exists, and must terminate when the emergency ceases and the Postal
Service is able to obtain service otherwise pursuant to its contracting
authority. No emergency contract may remain in effect more than 6
months without the approval of the manager, Transportation Portfolio.
Circumstances under which emergency contracts may be appropriate
include the following:
(a) A catastrophic event has interrupted normal transportation
operations.
(b) Strikes or other labor disputes are causing service interruptions.
(c) A mail transportation supplier has been suspended or removed or
a contract has been terminated.
(d) A sole highway supplier has died or become incompetent and the
estate representative will not continue service.
(e) The generation of mail at unanticipated locations or an
unexpected increase in mail volume at regular locations exceeds
the mail hauling capacity of the Postal Service or regular
suppliers.
4.4.5.d Modes of Transportation. Transportation contracts are distinguished by the
mode of transportation service provided. A contract for any mode of service
may require container and additional services such as stevedoring, terminal
handling, and ground drayage between postal facilities and the supplier's
facilities. The modes follow:
1. Air Transportation
(a) Air Taxi. Air taxi contracts call for the transportation of mail by
dedicated aircraft operating between two or more specified
points. In most cases, these contracts also call for the exclusive
use of the entire aircraft capacity for the transportation of mail.
Handbook PO-513, Mail Transportation Handbook, and more
specifically, Handbook PO-509, Air Taxi Contract Administration,
provides guidelines and procedures in the purchase and
administration of air taxi contracts. If any conflict occurs between
the handbooks and these guidelines, these guidelines apply.
(b) Air Network. Air transportation network contracts call for the
transportation of mail by air carrier, usually by dedicated aircraft
between points where hub transfers are used.
(c) Air Segment. Air transportation segment contracts call for the
transportation of mail by air carrier between an origin and a
destination specified by the Postal Service.
(d) Air System
(1) Air system contracts call for the transportation of mail from,
to and between any point(s) within the air carrier's existing
transportation system or network. The air carrier's existing
system may be modified from time to time as determined by
the air carrier. An air carrier's transportation system
consists primarily of transportation by aircraft, but may
include road feeder service (RFS) connections. Such
contracts may be awarded either (a) through a competition
in which price is a factor in the selection decision; or (b) on
the basis of a uniform or common rate set by the Postal
Service.
(2) If price is a factor in selecting air system suppliers, the
purchasing procedures contained in 4.2 must be followed.
(3) If set rate contracts are solicited, the purchasing method
used must be authorized by the manager, Transportation
Portfolio. The method used may deviate from those in 4.2,
so long as those procedures (a) are reasonably adapted to
negotiated, set rate contracting; and (b) are approved in
writing, prior to issuance of a solicitation, by the manager,
Transportation Portfolio.
(e) International Surface Airlift. An international surface airlift contract
calls for the international transportation of surface mail by United
States or foreign air carriers operating from designated departure
terminals in the United States, its territories or possessions to
designated terminals in foreign countries. It is Postal Service
policy to give preference to domestic air carriers. If an award is
based on price alone, a foreign proposal adjustment factor of 10
percent will be added to the lowest acceptable foreign proposal
when it is evaluated against domestic proposals. The manager,
Transportation Portfolio, may specify a more stringent method of
evaluating foreign proposals.
(f) Surface Airlift. A surface airlift contract calls for the airlifting of
surface mail to its destination.
2. Ground Transportation
(a) Highway. Highway transportation is the surface transportation of
mail by means other than bus, rail or water. Service may be
between either two or more designated points (over the road) or
within a local metropolitan area (shuttle service). Highway
transportation contracts may include requirements for the in-route
distribution of mail in specially designed and equipped vehicles,
box delivery, collections and other services similar to those
provided by rural carriers. Under these contracts, another suitable
means of transportation may be authorized when the use of a
motor vehicle would prove impracticable.
(b) Rail Transportation. A rail transportation contract calls for the
transportation of mail in rail carrier supplied or Postal
Service-furnished equipment by freight carriers or their
subcontractors. These contracts may incorporate one or many
origin/destination segments. Handbook PO-513, Mail
Transportation Handbook, provides guidelines and procedures in
the purchase and administration of rail contracts. If any conflict
occurs between the handbook and these guidelines, these
guidelines apply.
(c) Amtrak Transportation. An Amtrak transportation contract
consists of mail movement from various origins to various
destinations via Amtrak passenger train network. Mail is
transported in either mail handling cars (MHCs), baggage cars or
other equipment as specified in the requirements. Handbook
PO-513, Mail Transportation Handbook, provides guidance and
procedures for the purchase and administration of the Amtrak
contract. If any conflict occurs between the handbook and these
guidelines, these guidelines apply.
(d) Intermodal Transportation. Intermodal transportation is the
transportation of mail in carrier-supplied or Postal
Service-furnished equipment by the use of intermodal carriers or
subcontractors. These Intermodal carriers include rail carriers,
highway suppliers, or third party intermodal companies.
Intermodal transportation is the combination of more than one
mode of transportation to move mail between origin and
destination (for example, the use of highway and rail
transportation to complete one movement of mail from origin
entry to destination arrival).
(e) Bus. Bus contracts call for the transportation of mail by passenger
common carriers in passenger-carrying or other motor vehicles
on the routes on which they are permitted to carry passengers.
These contracts may either cover a segment of the particular bus
service or may cover the entire bus system or network.
3. Water Transportation
(a) Domestic Inland Water. A domestic inland water contract calls for
the transportation of mail in vessels between points within the 48
contiguous states or between points within Alaska, Hawaii, or
U.S. territories and possessions. Such a contract may include
provisions requiring box delivery, collection and other services
similar to those furnished by highway suppliers or rural carriers.
(b) Domestic Offshore Water. Domestic offshore water contracts call
for the transportation of mail in vessels between points in the 48
contiguous states and offshore points and points in Alaska,
Hawaii, or U.S. territories and possessions.
(c) International Ocean. An international water contract is a contract
with U.S. or foreign-flag carriers for the transportation of mail by
vessel from points in the United States or its territories and
possessions to points in foreign countries.
4. Ground Transportation Network. Ground transportation network
contracts call for the transportation of mail by ground truck operations
and may include ancillary terminal handling or delivery requirements as
determined by the Postal Service.
5. Terminal Handling. Terminal handling contracts call for the sorting,
dispatching, loading, or unloading of mail into and out of transportation
equipment. These services may be performed at the supplier or the
Postal Service terminal handling facility and may or may not be
ancillary in nature to the line-haul services performed by the same or
other suppliers.
6. Leased Trailer. Leased trailer contracts call for the lease of trailers for
transportation of mail within geographical areas designated by the
Postal Service. These contracts may contain provisions for trailer
maintenance and repair service and load restraint systems, and other
related requirements determined to be in the best interest of the Postal
Service.
4.4.5.e Alternatives to Contracts. The following may be used to obtain mail
transportation services:
1. Domestic Air Transportation Services. Transportation of mail between
points within the state of Alaska performed by scheduled air carriers
and paid for at rates of compensation established by the Department of
Transportation in its service mail rate orders (30 U.S.C. 5402(f)).
2. International Ocean Transportation. International ocean transportation
services may be obtained on a per-pound basis by tender. Mail of all
classes and empty mail equipment may be tendered to U.S. and
foreign-flag steamship companies for transportation in accordance with
the scheduled rates at Exhibit 4.4.5, unless the responsible manager
has negotiated other rates. Mail may be tendered at postal facilities for
transport by the steamship company to the pier, or at the carrier's
facility. The schedule or negotiated rates include any costs incurred for
such transport.
3. International Air Transportation. International air transportation services
other than those for which the Postal Service has contracting authority
under Title 39 U.S.C. 5402(a) and (b) and 49 U.S.C. 41904 must be
obtained from carriers with permits and reimbursed pursuant to
Department of Transportation service mail rate orders.
4.4.6.a General. Competitively awarded regular and temporary mail transportation
contracts may be renewed by the mutual agreement of the Postal Service
and the supplier. Regular or temporary highway and inland water contracts
that have been wholly subcontracted less than 6 months before their
expiration date (except those subcontracted by an immediate family member
of a deceased or incompetent supplier) may not be renewed. Wholly
subcontracted contracts that have been in effect for greater than 6 months
are eligible for renewal and may be renewed by mutual agreement between
the Postal Service and the subcontractor, by which the subcontractor
becomes the prime supplier under the renewal contract.
1. Duration. The renewal term of a temporary contract may not exceed 2
years, and the renewal term of a regular contract may not exceed the
greater of 4 years or the original contract term.
2. Service. The service provided at the beginning of the renewal term
must be the same as that existing at the end of the previous contract
term.
3. Contract Rate. The contract rate at the beginning of the contract
renewal term must be the contract rate in existence at the end of the
previous contract term.
Exhibit 4.4.5
International Ocean Transportation Schedule of Rates
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Distance (Nautical Miles)
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Rate (cents/lb)
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0-499
|
16.0
|
|
500-999
|
16.4
|
|
1,000-1,499
|
16.7
|
|
1,500-1,999
|
17.1
|
|
2,000-2,499
|
17.4
|
|
2,500-2,999
|
17.8
|
|
3,000-3,499
|
18.1
|
|
3,500-3,999
|
18.4
|
|
4,000-4,499
|
18.8
|
|
4,500-4,999
|
19.1
|
|
5,000-5,499
|
19.5
|
|
5,500-5,999
|
19.8
|
|
6,000-6,499
|
20.2
|
|
6,500-6,999
|
20.5
|
|
7,000-7,499
|
20.8
|
|
7,500-7,999
|
21.2
|
|
8,000-8,499
|
21.5
|
|
8,500-8,999
|
21.9
|
|
9,000-9,499
|
22.2
|
|
9,500-9,999
|
22.6
|
|
10,000-10,499
|
22.9
|
|
10,500-10,999
|
23.2
|
|
11,000-11,499
|
23.6
|
|
11,500-11,999
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23.9
|
|
12,000-12,499
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24.3
|
|
12,500-12,999
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24.6
|
|
13,000-13,499
|
25.0
|
|
13,500-13,999
|
25.3
|
|
14,000-14,499
|
25.7
|
|
14,500-14,999
|
26.1
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1. Establishing Requirements. Before entering into discussions for the
renewal of a contract, the purchase team must determine the need to
be met by the renewal contract and a reasonable rate for the service
that will meet that need.
2. Determining Satisfactory Service. Contracts should not be renewed
with suppliers who are currently providing less than satisfactory service.
Faults in service which do not rise to the level of deficiencies and thus
would justify termination for default may be sufficient to support a
determination not to renew.
3. Negotiating Service and Price. Having determined that a contract is
appropriate for renewal, the contracting officer with the assistance of
the purchase team enters into discussions with the supplier on the
terms of the renewal contract. Before agreeing to the final terms, the
purchase team must determine that renewal offers the best value and
most advantageous alternative to the Postal Service, price, and other
factors considered. For the purpose of this determination, "other
factors" may include the benefits of continuity of service and the
potential costs of disruption arising out of resolicitation.
4. Contract Modifications, Renewal, Resolicitation. If agreement is
reached on the renewal terms, the existing contract is modified to
reflect any adjustments in service and rates. If a contract will not be
renewed, or terms for renewal cannot be agreed upon in whole or in
part, any continuing service requirement may be the subject of a new
competitive solicitation.
5. Documentation. The determinations made throughout the renewal
process must be thoroughly documented in the contract renewal file.
4.4.6.d Restrictions. Emergency contracts may not be renewed.
4.4.6.e Clause. Clause B-78, Renewal, must be included in transportation contracts
that may be considered for renewal.
4.4.7.a When appropriate, contracting officers may issue modifications extending the
term of a contract, as distinct from the renewal of a contract (see 4.4.6).
4.4.7.b The contract term may be extended in increments of up to 1 year, provided
the extension does not result in a total term of more than 2, 4, or 6 years,
whichever is the allowable maximum contract term. The extension must be
made with the consent of the supplier by a supplemental agreement (see
6.5.1.c), and the need for the extension must be documented in the contract
file.
4.4.7.c Pending full renewal in accordance with 4.4.6, an expiring contract that is
eligible for renewal may be renewed for short terms of up to 1 year by mutual
agreement of the parties. When the full renewal is approved, the short-term
renewal may be converted into a full-term renewal to cover the full remaining
term of the contract.
1. Contracting officers working with their purchase team may take action
to discontinue, extend, or curtail contracts; to change and restate
service required; and to increase or decrease frequencies.
2. The purchase team must carefully consider the effect of any proposed
contract change. No change may be authorized that is contingent on or
related to a change in another contract service without the concurrence
of the contracting officer responsible for the other service.
1. A contract, or any part of a contract, should be terminated if it becomes
unnecessary or if it is to be superseded by some other service. The
supplier must be notified in writing of the termination and is entitled to
the indemnity provided in the contract. If it is more advantageous to
operate than to pay the indemnity, the service should be continued.
2. Discontinuance of service under the contract may, in some instances,
be to the advantage of the supplier. In these instances, if the supplier is
willing to waive the indemnity, the waiver must be included in a contract
modification discontinuing the service. In the case of highway or inland
domestic water routes, the waiver must be included in a supplemental
agreement signed by the supplier.
3. It is the policy of the Postal Service to furnish suppliers as much
advance notice as possible when a contract is to be terminated before
the end of its term. Specific requirements for notice may be stated in
the contract. A supplier may be notified by letter of intent to discontinue
in advance of issuing a formal notice. In the case of highway, inland
domestic water routes or air taxi, the termination must be approved by
the manager, Transportation Portfolio, prior to being issued.
1. Highway or Domestic Inland Water Contracts
(a) Types. There are two general types of service changes: minor
service changes and major service changes. They are effected by
contract modification.
(b) Definitions
(1) Minor Service Change
(i) A minor service change is any change that results in a
change in equipment type or termini; an extension; a
curtailment; a change in line of travel; or a permanent
increase in the frequency or number of trips which,
either individually or in combination with previous
changes, does not increase by more than 100 percent
the mileage required at the beginning of the contract
or renewal term.
(ii) An insignificant minor service change is one that
increases the supplier's rate of pay by no more than
$2,500.
(iii) A significant minor service change is one that
increases the supplier's rate of pay by more than
$2,500.
(2) Major Service Change. A major service change is any
service change other than a minor service change.
(c) Effecting Service Changes
(1) Insignificant Minor Service Change. Insignificant minor
service changes resulting in increased compensation to the
supplier may be ordered by the contracting officer as a
unilateral contract modification (see 6.5.1.c.2). They do not
require the supplier's approval. The contracting officer may
authorize an equitable increase in compensation at the
existing rate or at such other rates as the contracting officer
determines to be fair and reasonable. If the supplier
considers the amount of increase inequitable, the
contracting officer must attempt to negotiate a mutually
agreeable increase and incorporate it by contract
modification. If time permits, the contracting officer may
discuss the change and increase in compensation with the
supplier; if an agreement on compensation is reached, the
change may be made by contract modification. If
agreement cannot be reached, the contracting officer may
issue a unilateral contract modification and determine the
amount of increased compensation, subject to Clause B-9,
Claims and Disputes.
(2) Significant Minor Service Change. Significant minor service
changes are made by contract modification, indorporating a
price adjustment, with the agreement of the supplier.
(3) Major Service Change. Major service changes are
discussed with the supplier and effected by contract
modification. The contracting officer must obtain the
approval of the manager, Transportation Portfolio, before
entering into discussions regarding major service changes.
When determining whether or not to recommend or approve
the negotiation of a major service change, the purchase
team must take into consideration indemnity liability, the
supplier's experience in operating a service of the scope
required, past performance, rate, and any factors that would
indicate the proper course of action to take in the best
interests of the Postal Service. When a major service
change is not approved by the manager, Transportation
Portfolio, the old service may be terminated and the new
service purchased.
2. Other Surface Contracts and Air Contracts. Service changes for
contracts other than those discussed in 4.4.8.c.1 may be made,
consistent with the terms of the contract, provided that these changes
do not:
(a) Alter the original intent of the contract; or
(b) Transform the service into an entirely new service.
1. Exceptional service is additional service to perform scheduled or
backup route operations (such as extra trips, detour miles, and
additional equipment). Exceptional service may be required only when
an unanticipated increase in mail volume or other conditions arise that
require the performance of additional service or equipment.
2. Whenever feasible, contracting officers should hold discussions with
suppliers to establish the rate to be paid for exceptional service before
its performance. When discussions in advance would delay the mail or
otherwise not be feasible, the contracting officer or a designated
representative may order the supplier to perform such service at
pro-rata pay.
3. If no rate of pay for exceptional service has been negotiated in
advance, the supplier may be paid a lump sum reimbursement for the
difference between costs incurred as a direct result of performing
exceptional service and pro-rata payment, provided that such costs are
adequately supported by evidence satisfactory to the contracting officer.
Claims for compensation above pro-rata pay for exceptional service
must be filed in writing with the contracting officer, with full supporting
documentation, no later than 90 days after the performance of the
service.
4. Disputes regarding compensation are handled as provided in Clause
B-9, Claims and Disputes.
1. Improvement of mail service must be the primary consideration in
ordering a schedule change. Schedules may not be changed for the
convenience of suppliers, subcontractors, or drivers unless the change
will in no way be detrimental to the Postal Service. The purchase team
must consider the following before making schedule changes:
(a) Financial effect on the supplier. Reversing a schedule or requiring
an excessive layover might cause sufficient increase in cost of
operation to provide the basis for a request for pay adjustment.
(b) Hardship on suppliers or customers. Arbitrary action should be
avoided and reasonable effort should be made to work out
arrangements satisfactory to suppliers.
(c) Schedule realism. Schedules may not be set that would require
running times in violation of established speed limits.
2. The purchase team must ensure that schedule changes are
coordinated with all those responsible for other affected services.
4.4.8.f Emergency Contracts. The service and rate of compensation under
emergency contracts may not be changed unless specifically authorized in
the contract or by the manager, Transportation Portfolio.
1. Clause B-71, Termination for Convenience (Transportation), must be
included in all regular and temporary highway and air taxi contracts.
2. Clause B-72, Termination for Convenience - Emergency Contracts,
must be included in all emergency highway and air taxi contracts.
3. Clause B-67, Changes (Transportation), must be included in all
highway transportation regular and temporary contracts.
1. For the purpose of this section, a subcontract is any agreement, other
than an employer-employee agreement or a temporary agreement for
labor by an owner-operator as described below, between a party that
has contracted with the Postal Service to transport mail and a third
party, in which the third party agrees to provide all or part of the
contract service or goods or services that support performance of the
prime contract. An employer-employee agreement is one under which
the employee is subject to the continuing authority of the mail
transportation supplier to supervise and direct the manner of work
performance of the employee. Such an employer-employee agreement
is also characterized by, expressly or implied, the employer's
responsibility to pay compensation directly to the employee and to
withhold taxes and amounts for social security benefits from the
employee's compensation for the work performed under the agreement.
If an owner-operator, because of illness or temporary equipment failure,
is required to obtain labor from another in order to continue
performance of the service as required by the contract, that transaction
is not a subcontract within the meaning of this section.
2. Section 3.2.3, Subcontracting with Small, Minority, and Woman-owned
Businesses, is applicable to subcontracts under this section.
3. All subcontracts that require the subcontractor to handle, deliver, or
otherwise to have access to the mail must be approved by the
contracting officer, except that a supplier may, without approval of the
contracting officer, subcontract the whole or part of a contract or
irregular mail movements such as plant loads with one or more
owner-operators who provide and drive their own vehicles.
4. Execution by a supplier of a subcontract for the performance of contract
service and its approval by the Postal Service does not release the
supplier from its contractual obligations, nor from liability for damages.
5. Whenever the purchase team determines that a supplier has breached
the contract by subcontracting the whole or part of the contract contrary
to the requirements of these guidelines, the contracting officer may
terminate the contract for default.
6. Subcontractors performing contract service must meet the same
capability and qualification requirements as the prime supplier.
7. If a whole contract is subcontracted, the subcontract must be for the full
remainder of the contract term. The subcontractor's initial rate of pay
must be the same as the supplier's, unless there is a change in
operations costs resulting from a service change or from the enactment
of a statute or ordinance or the adoption of lawful regulations by any
federal, state, or local agency.
8. When a subcontract is terminated, the prime supplier may be required
to take charge of the route. A subcontract to provide contract service
may be terminated at the subcontractor's request only with the prior
approval of the contracting officer, which will be given only for good
cause. Subcontracts for contract service are automatically terminated
by death of the subcontractor or abandonment of the service by the
subcontractor.
9. When a subcontractor performing contract service fails to comply with
the terms of a contract, the contracting officer notifies the prime supplier
of the subcontractor's irregularities. The contracting officer may require
removal of the subcontractor for failure to perform and that the prime
supplier resume route operations, or exercise any other remedies
provided by the contracts with the prime supplier.
4.4.9.b Other Surface Contracts and Air Contracts. For other surface and air
contracts whose terms permit subcontracting, the supplier must give the
contracting officer advance notice of its intent to subcontract. The supplier
may enter into a subcontract unless notice of disapproval is received from the
contracting officer within 30 days of the date the notice was given.
In the case of highway or domestic inland water contracts, when the
purchase team determines that it is in the best interest of the Postal Service,
a supplier may be released from a contract if unable to perform adequately
due to a disability, or when the supplier's life or the public safety would be
endangered by the supplier's continued performance. Whenever practicable,
a replacement contract should be awarded before the current supplier is
released. The supplier must waive any indemnity as a condition of release.
For other than highway or domestic inland water contracts, a supplier may be
released only as provided in the terms of the contract.
4.4.11.a Damages. The contracting officer may make deductions from the payment
due supplier for failure to perform contractually required service, and may
assess damages for delinquencies with regard to any contractual
requirements as provided in the terms of the contract. The contracting officer
may also change or remit deductions and damages. Suppliers are also
answerable in damages to the Postal Service for the proper care and
transportation of the mail. Such damages, as determined by the contracting
officer, may be withheld by the Postal Service from compensation otherwise
due the supplier. Suppliers are accountable to the Postal Service for loss or
damage to the mail or any part thereof due to (1) loss, riffling, damage, wrong
delivery, depredation, or other mistreatment of the mail by the supplier or any
of the supplier's officers, agents, or employees, or (2) the failure of the
supplier or any of the supplier's officers, agents, or employees to exercise
due care in the custody, handling, or transportation of the mail.
4.4.11.b Breach Not Warranting Termination. When a supplier has committed a
breach of the contract not sufficiently serious to warrant termination, the
supplier may be assessed damages in an amount determined by the
contracting officer, in accordance with the terms of the contract.
4.4.11.c Loss or Damage to Mail. When a supplier, or supplier's agent or employee,
permits loss or damage to the mail, the contracting officer may withhold from
the supplier's compensation as damages the value of the mail lost or
damaged plus administrative costs of handling the irregularity.
4.4.11.d Supplier with Several Contracts. When a supplier holding several contracts is
subject to a fine or assessment for damages on one contract, the contracting
officer may withhold compensation due under other contract held by the
supplier until such fines and damages have been recovered.
4.4.12 Death or Incompetence of Supplier
1. The procedures below are to be followed upon the death or legally
adjudged incompetence of an individual contracting in his or her own
name (sole proprietorship), or in the name of a corporation all of whose
stock is substantially owned by the individual (closely held corporation)
and the supplier is a highway or inland domestic water supplier. These
procedures do not apply when the death or incompetence of an owner
or officer of a corporation does not significantly impair the corporation's
ability to perform the contract service.
2. The contracting officer must act to maintain continuity of service. If a
prime contract is affected, the representative of the estate
(administrator, executor, or immediate family member) must be
contacted to ascertain whether the estate wishes to continue to perform
the service. If a subcontract is affected, the subcontract may be
terminated and the prime supplier is responsible for performance of the
service.
3. The death of a sole proprietor terminates the contract, and the estate
has no obligation to continue to provide the service.
4. The representative of the estate may operate the route with the consent
of the contracting officer. If there is reason to deny consent, the
contracting officer must promptly submit a full written report to the
manager, Transportation Portfolio, for determination. The contracting
officer must document the file with evidence of the representative's
authority to represent and assume control of the supplier's business.
5. When an individual regains competence during the performance of the
contract by a representative, the individual may apply to the contracting
office for reinstatement as supplier. Any such application must be
approved by the manager, Transportation Portfolio, before
reinstatement.
4.4.12.b Partnership. When the supplier is a partnership, and the death or
incompetence of a member of the partnership dissolves the partnership, the
surviving partner or partners may continue to operate the route. At the
request of the surviving partner or partners, the contracting officer will order a
simple name change to recognize the new contracting entity.
1. When the representative of an estate assumes a route, the contract
rate remains the same. Pending pay adjustment requests are
processed under instructions in effect at the time of adjustment. The
operator of the route is entitled to all benefits of the adjustment.
2. The representative of an estate may subcontract all or part of the route
in accordance with 4.4.9.
3. If a contract expires while being performed by the representative of an
estate, the contract cannot be renewed, unless the representative is the
surviving spouse or child of the deceased, in which case the contract
may be renewed in that individual's name.
4. If the representative of an estate does not want to continue the service,
or if consent is denied for the representative to continue the service, the
contracting officer should purchase emergency service and issue a
solicitation for a new permanent service contract.
5. Procedures for processing payments to deceased or incompetent
suppliers are described in Handbook PO-513.
4.4.13.a Eligibility Requirements for Suppliers. Any individual 21 years of age or older,
any partnership in which at least one partner is 21 years of age or older, and
any corporation in which at least one of the officers is 21 years of age or
older may hold mail transportation contracts. See 1.6.4 for restrictions
concerning contracts with Postal Service employees and business
organizations substantially owned or controlled by Postal Service employees
or their immediate families. Solicitations may establish other eligibility
requirements as needed.
1. The following persons are ineligible to perform services under a
contract:
(a) Persons on parole or under suspended sentence for commission
of a felony.
(b) Persons with known criminal records which involve convictions for
offenses involving moral turpitude or dishonesty.
(c) Persons who associate with convicted felons.
(d) Persons known to engage in the illegal use, possession, sale, or
transfer of narcotics or other drugs.
(e) Persons who knowingly submit false data or conceal data for the
purpose of gaining employment.
(f) Persons whose traffic records indicate that their driving motor
vehicles would be hazardous (applies only to drivers and
assistants).
(g) Pilots with unsatisfactory aircraft operations safety performance
records.
(h) Persons who through their abusive or disruptive behavior would
pose a danger to fellow workers.
2. Supplier employees engaged as drivers of vehicles with a GVW of
10,001 lbs. or more must be at least 21 years old. All other drivers must
be at least 18 years old.
1. ID Cards. No supplier, subcontractor, or employee of a supplier or
subcontractor may be allowed access to mail matter or postal
operational areas unless he or she displays a valid identification card
issued by the Postal Service.
2. Screening. Except for those categories of persons identified in
paragraph d below, the Postal Service will not issue the identification
cards described above to individuals until they have been screened to
determine their suitability for that access. Forms and procedures for
screening are as set forth in Handbook PO-508 and in any applicable
Management Instruction.
1. Persons employed by suppliers whose own security screening
procedures have been approved by the contracting officer and
reviewed by the Inspector-in-Charge.
2. Persons who are civil service personnel otherwise subject to
investigation under Executive Order 10450.
3. Persons previously screened under another contract with a break in
service of less than 1 year.
4. Persons hired for service in an emergency of not more than 15 days.
(This does not exempt regular relief or substitute employees or those
repeatedly hired on an emergency basis.)
5. Persons employed to transport plant-load mail, but only if such mail is
not generated with regularly recurring frequency.
4.4.13.e Notification of Supplier. The contracting officer will notify the supplier of the
grounds on which any person has been denied access to the mails under the
procedure set out herein. Any decision as to whether a supplier,
subcontractor, or contract or subcontract employee is to be denied access to
the mail or precluded from operating a vehicle transporting mail must be
made by the contracting officer in accordance with the eligibility requirements
of 4.4.13.a and 4.4.13.b.
4.4.13.f Disclosure of Information. All information obtained or developed in the
screening program must be restricted from disclosure outside the Postal
Service to anyone other than the supplier, subcontractor, or contract or
subcontract employee concerned.
4.4.14.a General. The purchase team is responsible for monitoring contract
performance in a manner appropriate to ensure that the supplier provides all
services and equipment required under the terms of the contract (see 6.1.1).
4.4.14.b Unsatisfactory Service. The purchase team under the direction of the
contracting officer must take necessary action to correct any problem caused
by unsatisfactory supplier performance. If the remedies and damages
provided in 4.4.11 are insufficient, termination for default should be
considered.
4.4.14.c Major Irregularity. A major irregularity is an action or service deficiency
requiring summary suspension or removal of the supplier in the public
interest (such as subcontracting without approval, or theft, deliberate loss,
damage, or abandonment of the mail or contract operation). When a major
irregularity occurs, the contracting officer may take immediate suspension or
removal action, without prior notice to the supplier. Suspension may be with
or without pay, as provided in the contract.
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