SDDC Confirms Linehaul Mileage Based on Blocks 18/19
January 25, 2012 
1 Comment
Note: This article is part of a series on changes to the 2012 400NG and International Tender. (To view the entire series of articles, click here.) Please note that these articles are not intended to cover every change made, so TSPs still need to read the tariffs prior to filing rates. Also, these posts are based on our own interpretation of the tariffs, and we cannot guarantee that our interpretation will always be shared by SDDC, the PPSOs, or GSA.
During last year’s series of blog posts on the upcoming tariff changes, we posted an article entitled “Did SDDC Change the 400NG Linehaul Calculation?“. The article’s title was in the form of a question because we weren’t sure of SDDC’s intent on how mileage should be calculated on the 400NG. Our reading of the tariff led us to believe that linehaul mileage should be based on the distance from Block 19 of the GBL to Block 18 of the GBL, not actual pickup and delivery locations.
However, it was an interpretation that was not based on any clear guidance, rather it was a judgement based on a number of different sections in the tariff. It is likely there were TSPs who disagreed with our interpretation, and were billing based on actual mileage. And the actual rating done by DPS provided no clue which interpretation was correct, since DPS uses the mileage provided by the TSP to calculate linehaul, and does not independently calculate the miles to be used.
It was a less than ideal situation to have the largest and most frequently billed line item being calculated with unclear directions, so we looked forward to seeing the new 2012 400NG with the hope this issue would be clarified. When the new tariff was released, we were disappointed to find out that the new tariff actually made the situation less clear. Much of our conclusion from the prior tariff was based on a definition of “Total Shipment Miles” which appeared in Appendix A of the 2011 400NG. This definition was removed in the 2012 tariff as part of extensive changes to the Appendix A sections.
Once again, we requested that SDDC clarify how mileage on linehaul was to be calculated, and in the release of Change 1 to the 2012 400NG, we believe they have finally done that. They have changed the definition of the “Base Linehaul” element of the linehaul charge to read as follows:
Base Linehaul (BLH) is the charge element for the transportation of the shipment from origin (block 19) to destination (block 18), through any stops along the way. BLH is computed using the total weight and total miles of the shipment.
While there are still concerns with the growing reliance of SDDC’s usage of Block 18/19, we are pleased that at least they have clarified this important issue. The fundamental building block of the cost of moving a shipment for the DoD should not be left to guessing and interpretation about its calculation. With Change 1 to the 2012 400NG, SDDC has finally added the clarity that was needed.
Do you agree with SDDC’s decision to base linehaul mileage on Blocks 18/19? Please use the comments below to share your opinion:
Related Posts
- Tariff Changes: Did SDDC Change the 400NG Linehaul Mileage Calculation? - January 26th, 2011
- Tariff Changes: Delivery Out of SIT Mileage Based on Block 18 - January 13th, 2011
- Tariff Changes: Shorthaul Calculation Simplified in 400NG - January 18th, 2011
We emailed the top brass at SDDC in May, 2011, giving several examples. No response. The biggest complaint I have heard is that the destination address is frequently not known, so the dest address is given as the receiving GBLOC. Of course, if the shipper is getting base housing, then the rating would be correct. But in many cases, the Zip3 of the dest GBLOC will not be the same as the Zip3 of the dest residence. If the residence falls into a different BPC than the GBLOC, either the carrier or SDDC is losing money. My examples dealt with Ft Belvoir, which has employees that LIVE in DC, MD, VA, and WV, if not others. A carrier moving a shipment from FL to MD is ONLY getting paid to Ft Belvoir if the final dest address is not known at the time the GBL is issued. Perhaps an email campaign would get better results. Don’t get me started on SIT.