For more than a decade, the Department of Defense (DoD) struggled to find the right contracting mechanism that would allow it to take advantage of the enormous logistics capabilities resident in the private sector. Third-party logistics providers have the experience, tools, databases, and procedures to support a network of transportation providers while minimizing both the cost and time involved in moving goods and materials. But just when the Pentagon got it right with its Defense Freight Transportation Services (DFTS) contract, the General Services Administration (GSA) made an unnecessary and possibly illegal power grab, claiming the right to conduct oversight of the DFTS contract. In its alleged oversight role, GSA also saw fit to re-interpret the contract’s provisions, contravening the express wishes of the contracting organization, Transportation Command (TRANSCOM). If the GSA power grab for oversight of defense transportation contracts is allowed to stand, third-party logistics providers may shy away from bidding on future TRANSCOM contracts. I have written more on DFTS and the GSA’s egregious violation of both law and regulations here.
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