PowerTrack use increases for MTMC carrier payments
ALEXANDRIA, Va. (USTCNS)---All transportation carriers of domestic military cargoes for the Military Traffic Management Command are now paid by PowerTrack automated software.
In a period of three years, MTMC has instituted PowerTrack payments as a requirement for all freight shipments, said Tom Hicks, coordinator.
"This is an incredible achievement," said Hicks. "It pays the carriers promptly and provides us a treasure trove of transportation data. We absolutely would not have had the success with this initiative without the full support of the military services, defense agencies and our industry partners."
In the last fiscal year ending Sept. 30, PowerTrack paid $1.1 billion in MTMC transportation charges based on 2.7 million transactions. Currently, there are 550 participating MTMC transportation carriers. The largest category is 430 trucking firms. Other carriers include: Barge, 25; pipeline, 20; rail, 20; and ocean, 15.
Not included in the PowerTrack payments are personal property carriers for MTMC's household goods shipments.
PowerTrack is an automated payment system of USBank, in Minneapolis. For a sliding fee of 1-2 percent, depending on contract award, carriers are paid within several days for their shipments. USBank, in turn, is reimbursed by the Defense Finance & Accounting Service.
"The automated payment system has been well received by our carriers," said Hicks. "This includes truck, rail, barge, air, pipeline and ocean carriers. Our transportation partners receive their charges promptly and move on to other business. They don't get involved in the process of seeking reimbursement from the Defense Finance & Accounting Service-which, in the past, was sometimes lengthy."
MTMC mandated PowerTrack payments for its military cargoes in the fall of 2000. Within a few months, said Hicks, most carriers switched to the USBank payment system. In the year that followed, additional carriers were added.
"We're at 100 percent today," said Hicks.
MTMC carriers are positive about their PowerTrack experience.
"With only a few exceptions, CSX Transportation's experience has been outstanding," said Jon Meyer, Senior Account Manager. "We're often paid in less than the three business days as provided for in the agreement. Compared to the 'paper environment,' which often took upwards of 70 days, this is a real cash flow benefit for CSX Transportation."
Landstar trucking was equally supportive.
"Landstar is pleased with the performance of PowerTrack, especially with the speed we're being paid, and the ease of working with the shippers in dispute resolution," said Dave Larson, Vice-President, Government Transportation Services. "Our only complaint is that government agencies other than the Department of Defense have not adopted Power Track as their billing and payment system."
The use of PowerTrack represents labor cost savings for Maersk Sealand.
"The number of man-hours required to manage the military contract revenue has decreased significantly," said Tony Nowotarski, Director, Government Marketing. "More importantly, the length of time it takes to receive payment has reduced dramatically from an average of 45 days to an average of 4.5 days.
"It is a revolutionary initiative."
PowerTrack is one of the most successful parts of Management Reform Memorandum #15, said Hicks. The Department of Defense initiative seeks to implement commercial practices within the transportation system in lieu of government-unique or military-unique systems or processes.
The payment system was approved by the Department of Defense in February 1999. As of March 31 Government Bills of Lading may no longer be used for invoicing domestic freight shipped by the Department of Defense.
(FROM MILITARY TRANSPORTATION MANAGEMENT COMMAND PUBLIC AFFAIRS)
In a period of three years, MTMC has instituted PowerTrack payments as a requirement for all freight shipments, said Tom Hicks, coordinator.
"This is an incredible achievement," said Hicks. "It pays the carriers promptly and provides us a treasure trove of transportation data. We absolutely would not have had the success with this initiative without the full support of the military services, defense agencies and our industry partners."
In the last fiscal year ending Sept. 30, PowerTrack paid $1.1 billion in MTMC transportation charges based on 2.7 million transactions. Currently, there are 550 participating MTMC transportation carriers. The largest category is 430 trucking firms. Other carriers include: Barge, 25; pipeline, 20; rail, 20; and ocean, 15.
Not included in the PowerTrack payments are personal property carriers for MTMC's household goods shipments.
PowerTrack is an automated payment system of USBank, in Minneapolis. For a sliding fee of 1-2 percent, depending on contract award, carriers are paid within several days for their shipments. USBank, in turn, is reimbursed by the Defense Finance & Accounting Service.
"The automated payment system has been well received by our carriers," said Hicks. "This includes truck, rail, barge, air, pipeline and ocean carriers. Our transportation partners receive their charges promptly and move on to other business. They don't get involved in the process of seeking reimbursement from the Defense Finance & Accounting Service-which, in the past, was sometimes lengthy."
MTMC mandated PowerTrack payments for its military cargoes in the fall of 2000. Within a few months, said Hicks, most carriers switched to the USBank payment system. In the year that followed, additional carriers were added.
"We're at 100 percent today," said Hicks.
MTMC carriers are positive about their PowerTrack experience.
"With only a few exceptions, CSX Transportation's experience has been outstanding," said Jon Meyer, Senior Account Manager. "We're often paid in less than the three business days as provided for in the agreement. Compared to the 'paper environment,' which often took upwards of 70 days, this is a real cash flow benefit for CSX Transportation."
Landstar trucking was equally supportive.
"Landstar is pleased with the performance of PowerTrack, especially with the speed we're being paid, and the ease of working with the shippers in dispute resolution," said Dave Larson, Vice-President, Government Transportation Services. "Our only complaint is that government agencies other than the Department of Defense have not adopted Power Track as their billing and payment system."
The use of PowerTrack represents labor cost savings for Maersk Sealand.
"The number of man-hours required to manage the military contract revenue has decreased significantly," said Tony Nowotarski, Director, Government Marketing. "More importantly, the length of time it takes to receive payment has reduced dramatically from an average of 45 days to an average of 4.5 days.
"It is a revolutionary initiative."
PowerTrack is one of the most successful parts of Management Reform Memorandum #15, said Hicks. The Department of Defense initiative seeks to implement commercial practices within the transportation system in lieu of government-unique or military-unique systems or processes.
The payment system was approved by the Department of Defense in February 1999. As of March 31 Government Bills of Lading may no longer be used for invoicing domestic freight shipped by the Department of Defense.
(FROM MILITARY TRANSPORTATION MANAGEMENT COMMAND PUBLIC AFFAIRS)
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