Diversion Tariff Language Changed to Match DPS Capabilities

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.

Our experience with diversions in the DPS computer system has led us to the opinion that they have never really worked as intended. Since the launch of DPS, there have been a number of challenges for users that makes diversions difficult to handle. The task of putting a shipment into diverted status, and getting the charges paid in full takes a lot of work and time on not only the TSP’s end, but the PPSO’s as well. This can be especially time-consuming in situations when a diversion results in a change in the destination rate area, which may change the GBLOC, or require a change in the applicable single factor rate (SFR).

In the latest update to the International Tender, SDDC has addressed these concerns with extensive changes to the diversion language. At the risk of generalizing, SDDC decided that instead of diverting shipments and dealing with the hassles that comes along with handling new destination GBLOCs and SFRs, they would instead terminate and rebook the shipments whenever possible. This is certainly an easier, quicker fix than the programming that would have been required to get the DPS computer system to handle the previous rules properly.

Ideally, the shipment is rebooked with the same TSP, though the tariff guidance only states “PPSO can attempt to book with original TSP”, not that they should attempt to do so.  In order to book the “new” shipment with original TSP, that TSP must have rates on file in the new channel that is being rebooked. If the TSP does not file rates in that channel, which is common especially for International TSPs in Domestic channels, then the shipment will have to be booked with a new TSP. Even if the original TSP has rates on file in that channel, they must also be in the same DPS shipment distribution quartile as the new booking. If they are in a different quartile, then the shipment will have to be rebooked with a new TSP.

If a shipment transfers to a new TSP, there are some potential problems to consider. The original TSP needs to recover their lift vans. The new TSP may want to transport it in a van as opposed to a lift van. A transfer of liability occurs, and that is always cause for potential problems. While terminating and rebooking the shipment is an easy way to avoid the current problems with diversions in the DPS system, it is not without problems for the TSPs involved.

One final thing to note about the tariff changes for diversions is SDDC decided to take much of the language dealing with different diversion scenarios out of the International Tender and placed in a new document entitled “Item 526 Diversion Table.” The tariff only includes instructions on how to find this document on the SDDC website. We are not sure of the reason for removing this set of instructions from the International Tender, but TSPs need to be aware that there is another document they will need to review to be up to speed on the changes to diversions.

Do you agree with the changes SDDC has made to diversions in the International Tender? Use the comments below to share your opinion:

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