procure insurance coverage for its benefit, the contracting officer shall ascertain that there is no statutory prohibition and that funds are available therefor, and shall document the need and authorization therefor.

(c) "Valuables" shall be shipped as provided in the Government Losses in Shipment Act (50 Stat. 479 as amended; 5 U.S.C. 134). (See 31 CFR 260 for definition of the term "Valuables" and for applicable procedure.)

(d) When a commercial carrier is required to assume full responsibility for loss or damage to Government property in its possession, and the carrier is required to provide appropriate insurance to cover its assumed responsibility, the cost of such insurance to the carrier shall be included in and properly considered as a part of the transportation cost. Subpart 1-19.2-Transportation Factors in the Procurement of Personal Property

§ 1-19.200 Scope of subpart.

This subpart prescribes policies and procedures designed to assure that proper consideration is given to transportation factors in every phase of the procurement of personal property for the Government.

§ 1-19.201 Transportation considerations in procurement planning. Whether personal property is being procured to satisfy a specific requirement or to fulfill a long-range program, transportation advice and assistance shall be sought by, and furnished to, contracting officers from the beginning of the planning stage of the procurement cycle.

§ 1-19.201-1

Economical quantities.

In the procurement of personal property, consideration should be given to the fact that transportation rates per unit generally are lower for larger quantities than for smaller quantities. Accordingly, where a quantity larger than the quantity shown on a purchase request can be transported at lower unit transportation costs and where it appears that the amount of the savings considered in connection with the need to purchase additional quantities for use would be sufficient to warrant the procurement of the larger quantity, the purchasing activity should consult with the activity which submitted the purchase request to

determine whether procurement of the larger quantity would be advantageous, transportation costs and all other factors considered. This may be the case, for example, when the additional quantity (a) could profitably be stored by the activity for future use or (b) could be distributed advantageously to several using activities on the same transportation route or in the same geographical

area.

§ 1-19.201-2 Crosshauling and backhauling.

In developing the overall plans for the procurement and distribution of personal property, the procuring activity should exert every effort to avoid the expenditure of funds for unnecessary crosshauling or backhauling; that is, the transportation of personal property of the same kind in opposite directions or the return of the property to or through areas previously traversed in shipment. § 1-19.201-3 Transit privileges.

Where it can be anticipated that shipments of personal property being procured in volume lots (e.g., carloads or truckloads) may need to be stopped at an intermediate point, en route to final destination, for storage, export packing, processing, or other purposes, a traffic analysis should be made to determine the possible benefits to be gained by the Government through the use of existing transit privileges accorded by carriers or through efforts to obtain additional transit privileges from the carriers. Such benefits derive from the use of through rates from origin to the ultimate destination, plus a charge specified by the carrier for the transit privilege, in lieu of a more expensive combination of rates covering the transportation from origin to the transit point and the transportation from the transit point to the ultimate destination.

§ 1-19.201-4 Direct deliveries.

Where it is the usual practice of a procuring activity to purchase personal property in large quantities for shipment to a central point and subsequent distribution to using activities, as needed, consideration shall be given to the feasibility of providing for direct delivery from the contractor to the using activity when sufficient quantities are involved to warrant scheduling such delivery.

§ 1-19.201-5 Personal property requiring special handling.

In planning the procurement of personal property which may require special handling because it is of unusual size or weight, because it is potentially dangerous to other property or human life, or for any other reason, transportation advice and assistance shall be obtained at the initial planning stage of the procurement. This will permit (a) examination of the regulations of carriers and regulatory bodies; (b) arrangements for special equipment, permits, and requirements which will have to be met when the items are ready for shipment; (c) the consideration of transportation factors in the design and/or engineering of the items; e.g., with regard to transportation in an assembled or knocked-down condition; and (d) any other action dictated by the application of sound traffic management principles.

§ 1-19.201-6 New and modified articles.

In planning the procurement of new or modified articles, transportation officers shall be alerted, at the initial planning stage of the procurement, in order that they may explore the possibility of negotiations for appropriate freight classification ratings and reasonable transportation rates.

§ 1-19.202 Transportation factors in invitations.

Invitations involving the procurement of personal property shall contain the information and provisions required by this § 1-19.202 and any other information and provisions deemed appropriate by the contracting officer after considering all transportation factors, including those discussed in Subpart 1-19.1 and this Subpart 1-19.2.

§ 1-19.202-1 Commodity description.

Invitations must contain a complete description of the commodity being procured, including packing and packaging instructions, not only to enable the bidder to quote properly on the commodity but also to provide for determination of the proper transportation charges (see §§ 11.305 and 1-1.307).

§ 1-19.202-2 Packing and marking.

(a) Attention to packing and marking can reduce transportation and administrative costs. Proper packing and marking for shipment helps to effect safe and timely delivery of supplies at desti

nation, while improper packing and marking not only can cause increased or added transportation costs but also necessitate replacement or repair of lost or damaged goods, and give rise to claims against carriers and/or consignors. Circumstances such as those described in (b) and (c) of this § 1-19.202-2, which require special packing and marking, should be foreseen and adequate provision made therefor.

(b) Supplies which are to be stored for long periods, which may be exposed to the elements, or which may ultimately be intended for export shipment, usually require special treatment; e.g., it may be necessary to coat machine surfaces with rust-inhibiting compounds, or otherwise provide special protection.

(c) Shipments arriving at destination must be readily identifiable. This may necessitate special stenciling, marking, or the attachment of packing lists in weather-resistant containers to the exterior of boxes or crates.

§ 1-19.202-3 Guaranteed shipping weights.

maximum

(a) Invitations shall require bidders to furnish information, where appropriate, regarding the guaranteed maximum shipping weights and the cubage of items being procured (see § 1-2.202-3 (b) (3)), so that freight costs may be evaluated on a realistic basis. (See § 119.202-6.)

(b) When the procurement requires guaranteed maximum shipping weights and cubage, the invitation shall include a clause similar to the following:

When actual shipping weights or cubage exceeds the guaranteed shipping weights or cubage, the amount of the Contractor's invoice shall be reduced by a sum equal to the cost incurred by the Government as a result of such excess.

§ 1-19.202-4 Minimum size of ship

ments.

(a) Invitations shall require bidders to furnish information, where appropriate, regarding the minimum size of shipments, so that freight costs may be evaluated on a realistic basis. (See § 1-19.202-6.)

(b) When the procurement is to be for quantities which would qualify for volume rates, the invitation shall include a clause similar to the following:

When the contract requires load-lot shipments and the Contractor, in the absence of special instructions, ships in less-than-load lots, the amount of the Contractor's invoice

(a) Where personal property is being procured on the basis of the delivery terms set forth in §§ 1-19.302 through 1-19.306, the invitation shall include, in addition to the responsibilities of the contractor with respect to the delivery term being used, a requirement that the bidder shall furnish the Government so much of the following data as shall be applicable to the particular procurement:

(1) Modes of transportation and, if rail transportation is used, names of rail carriers serving his facility;

(2) Number of railroad cars, motor trucks, or other conveyances that can be loaded per day;

(3) Type of packing: box, carton, crate, drum, bundle, skids, etc., and, where applicable, package number from the governing freight classification;

(4) Number of units packed in one container;

(5) Guaranteed maximum shipping weight; cubic measurement; and length, width, and height of each container;

(6) Minimum size of each shipment; (7) Number of containers or units that can be loaded in a car, truck, or other conveyance of size normally used (specify type and size) for the commodity;

(8) Description of material in terms of the governing freight classification or tariff under which lowest freight rates are applicable; and

(9) Benefits available to the Government under transit arrangements made by the contractor.

(b) In addition to the data referred to in (a) of this § 1-19.202-6, the bidder

shall be required to furnish, where applicable, supplemental data as follows:

(1) For delivery "f.o.b. origin, contractor's facility" (see § 1-19.303), if the designated facility is not covered by the line-haul transportation rate, the charges required to deliver the shipment to the point where the line-haul rate is applicable must be stated.

(2) For delivery “f.o.b. origin, freight allowed" (see § 1-19.304), the basis on which transportation charges will be allowed shall be specified, including the origin and destination from and to which transportation charges will be allowed.

(c) Where personal property is being procured on the basis of the delivery terms set forth in §§ 1-19.307 through 1-19.315, the invitation shall include, in addition to the responsibilities of the contractor with respect to the delivery term being used, a requirement that the bidder shall furnish the Government data applicable to the particular procurement as follows:

(1) For delivery "f.o.b. vessel, port of shipment" (see § 1-19.307); "f.a.s. vessel, port of shipment" (see § 1-19.308); and "f.o.b. inland carrier, point of exportation" (see § 1-19.309):

(i) Delivery schedule in number of units and/or long or short tons;

(ii) Maximum quantities available per shipment;

(iii) Quantity that can be made available for loading to vessel per running day of twenty-four hours (if procurement involves a commodity to be shipped in bulk);

(iv) Minimum leadtime required to make supplies available for loading to vessel; and

(v) Port and pier, or other designation, and, where applicable, the maximum draft of vessel (in feet) that can be accommodated.

(2) For delivery "f.o.b. inland point, country of importation" (see § 1-19.310); and "f.o.b. designated air carrier's terminal, point of importation" (see § 1-19.315):

(i) Delivery schedule in number of units and/or long or short tons;

(ii) Maximum quantities available per shipment; and

(iii) Other data appropriate to shipment by air carrier.

(3) For delivery "ex dock, pier, or warehouse, port of importation" (see § 1-19.311), and "c.&f. destination" (see § 1-19.312):

(i) Delivery schedule in number of units and/or long or short tons;

(ii) Maximum quantities available per shipment; and

(iii) Number of containers or units that can be loaded in a car, truck, or other conveyance of size normally used (specify type and size) for the commodity.

(4) For delivery "c.i.f. destination" (see § 1-19.313):

(i) The same as specified in (3) of this § 1-19.202-6(c); and

(ii) The amount and type of marine insurance coverage; e.g., whether the coverage is W.A. (With Average) or F.P.A. (Free of Particular Average) and whether it covers any special risks or excludes any of the usual risks associated with the specific commodity involved.

(5) For delivery "f.o.b. designated air carrier's terminal, point of exportation" (see § 1-19.314):

(i) Delivery schedule in number of units, type of package, and individual weight and dimensions of each package;

(ii) Minimum lead time required to make supplies avaliable for loading to aircraft;

(iii) Name of airport and location to which shipment will be delivered; and (iv) Other data appropriate to shipment by air carrier.

§ 1-19.202-7 Use of appropriate delivery terms.

(a) In the selection of the appropriate delivery terms for inclusion in invitations, the delivery term ("f.o.b. origin," "f.o.b. destination," etc.) shall be that which is most advantageous to the Government. Where alternative terms of delivery are feasible and may provide economy in transportation, invitations shall provide for alternative bases so that the contracting officer can, at the time of evaluation, select the delivery term which is most favorable to the Government.

(b) The following guides may be followed in selection of the appropriate delivery term (see Subpart 1-19.3) for inclusion in the invitation:

(1) Shipments within the United States (excluding Alaska and Hawaii) — (i) Industry practice. When it is the general practice of an industry to include the delivery costs in the selling price of a certain commodity, invitations shall ordinarily provide for delivery "f.o.b. destination."

(ii) Nature of commodity. In procuring articles having peculiar transpor

tation characteristics which the supplier is especially equipped to deal with, consideration shall be given to the advisability of procuring such articles on an "f.o.b. destination" basis. An example of such procurement would be precision machinery for which the supplier has specially designed transportation and handling equipment and which could easily be damage by being subjected to normal transportation hazards.

(iii) Destinations known-(a) Small lots. Generally, invitations shall provide for delivery "f.o.b. destination" when it is anticipated that shipments will involve small lots; e.g., less-thancarload or less-than-truckload quantities.

(b) Volume lots. Generally, invitations shall provide for bids to be submitted on the basis of delivery "f.o.b. origin" and "f.o.b. destination" when it is anticipated that shipments will be made in carloads, truckloads, barge loads, or other volume lots.

(c) Specific quantities unknown. When total requirements and destinations to which shipments will be made are known, but the specific quantity to be shipped to each destination cannot be predetermined, invitations shall provide for bids to be submitted on the basis of delivery "f.o.b. origin" and/or "f.o.b. destination" and bids shall be evaluated on both bases. In order to evaluate "f.o.b. destination" bids and to protect the interests of both the Government and the contractor during the course of the performance of contracts awarded on this basis, where the specific quantities are unknown, the following clause shall be incorporated in both the invitation and the contract:

For the purpose of evaluating "f.o.b. destination" (bids) (proposals), and for no other purpose, it is estimated that the quantity specified will be shipped to the destinations indicated. If the quantity shipped to each destination varies from the quantity estimated, and if the variation results in a change in the transportation costs, appropriate adjustment will be made.

following clause shall be incorporated in such invitations:

For the purpose of evaulating (bids) (proposals), and for no other purpose, the final destination (s) for the supplies will be considered to be (insert location(s)).

(2) Shipments from the United States (i) Industry practice. When it is the general practice of an industry to include the delivery costs in the selling price of a certain commodity, invitations shall ordinarily provide for delivery to the port or airport of exit; e.g., "f.o.b. named port of exportation," "f.o.b. vessel," "f.a.s. vessel," etc.

(ii) Government control. Where it may be desirable to have available the use of alternate ports or to stop the supplies in transit for export packing or consolidating with other supplies; or where, for some other reason, the Government may need to control the transportation, invitations shall provide for delivery on the basis of "f.o.b. origin."

(iii) Alternative basis. Where it is feasible, invitations shall provide for delivery on the basis of alternative delivery terms so that the delivery term most favorable to the Government may be selected; e.g., (a) "f.o.b. origin" and "f.o.b. vessel, port of shipment," when procuring bulk commodities, or (b) "f.o.b. origin" and "f.a.s. vessel, port of shipment," when procuring other than bulk commodities.

(3) Shipments from outside the United States. Langauge barriers, the lack of agency representatives in foreign countries, or other factors, may restrict the feasibility of procuring supplies for delivery at points within foreign countries. In such cases, invitations should provide for bids to be submitted on the basis of delivery to the foreign port or airport of exit, delivery to the United States, or delivery to another destination country. Where feasible, invitations shall provide for bids to be submitted on the basis of alternative delivery terms.

(c) The appropriate delivery term definition and related contractor responsibilities, as set forth in §§ 1-19.302 through 1-19.315, shall be incorporated (by reference, where appropriate) in the invitation.

§ 1-19.202-8 Options in shipment and delivery.

Although the Changes article (see § 1-7.101-2) allows certain changes to be made in regard to shipment and deliv

ery, it may be desirable, in some instances, to provide specifically for certain options in the invitation.

(a) Where appropriate, the Government may reserve the right to (1) direct deliveries of all or part of the contract quantity to destinations or to consignees other than those specified in the invitation and in the contract; (2) direct shipments in quantities which may require different transportation rates from those on which the contract price is based; and (3) direct shipments by a mode of transportation other than that which may have been stipulated in the invitation and in the contract.

(b) Where the transportation charges are for the account of the contractor and changes in the transportation requirements, as directed by the Government, result in an increase or decrease in transportation costs, an appropriate equitable adjustment shall be made.

§ 1-19.203 Transportation factors in evaluation of bids.

The evaluation of bids shall include appropriate consideration of the transportation factors set forth in this. § 1-19.203.

§ 1-19.203-1 Freight cost determinations.

When requesting assistance in evaluating bids, the contracting officer shall furnish the transportation officer with all pertinent data, including such information as the following:

(a) A complete description of the commodity being purchased, including packing and packaging instructions; (b) The planned date of award; (c) The date of initial shipment; (d) Total quantity to be shipped (including weight and cubic content, where appropriate);

(e) The delivery schedule;
(f) The contract period; and

(g) The possible use of transit privileges, including stopoff for partial loading or unloading, or both.

§ 1-19.203-2 Adequacy of loading and unloading facilities.

(a) Adequacy of loading facilities. When determining the transportation capabilities of a bidder, consideration shall be given to the type and adequacy of the bidder's shipping facilities, including his ability to consolidate and ship in load lots.

(b) Adequacy of unloading facilities.