LETTER TO HARRY E. FITZWATER FROM L. L. MITCHELL

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP85B01152R000500660009-4
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 11
• Document Creation Date: December 20, 2016
• Document Release Date: December 14, 2007
• Sequence Number: 9
• Publication Date: August 9, 1983
• Content Type: LETTER

 1983
Mr. Harry E. Fitzwater
Deputy Director of Administration
Central Intelligence Agency
Washington, DC 20505
We would like to inform you of the General Services Administration's (GSA)
newest initiative to improve Federal travel management--the use of commercial
charge cards and travelers' cheques as the primary means to pay for employee
travel expenses. While this may represent a radical departure from past
practices in Government, it is a method which is used extensively by more than
350,000 private firms, both large and small. We plan to implement this program
on a pilot basis in October of this year, and estimate it will lead to annual
savings of more than $200 million once fully-implemented Government-wide.
The current payment system for Federal travel, which consists principally of
Government Transportation Requests (GTR's) and cash advances, has long been
regarded as labor intensive, costly to administer, and extremely inefficient.
At the same time, the Government traditionally has been reluctant to venture
into the charge card medium due to fears of potential abuse and increased
liability exposure for the Government. A great deal of care and effort has
gone into the design of GSA's proposed payment system to ensure against both
concerns.
Beginning October 1, 1983, GSA and six additional agencies will inaugurate
the new payment system. Other participants include the: U.S. Army Corps of
Engineers; Federal Horne Loan Bank Board; National Credit Union Administration;
and major components of the Departments of State, Agriculture, and Commerce.
Employees designated by each participating agency as frequent travelers will be
issued individual charge cards to be used to acquire transportation, lodging,
meals, automobile rentals, and other official travel expenses. In addition,
travelers' cheques will be issued in lieu of cash advances to cover miscella-
neous travel expenses, such as tips, ground transportation, light meals, etc.
Upon completing their travel, employees will file claims for reimbursement and
will be reimbursed for allowable expenses. Subsequently, they will be billed
by, and remit directly to, the charge card company. There will be no liability
on the Government's part for payment of those charges. In addition to individ-
ual cards, a limited number of cards will be issued in the name of the depart-
ment or agency to he used as needed by infrequent travelers, as well as to
purchase tickets and other travel arrangements on a group basis. The statements
for such purchases will be sent directly to the agency for payment.
 We are extremely excited about the many advantages offered by this system, and
trust that you also will recognize buth in substantial
rvice to Federal.
just in savings to the taxpayer, improved se
The cost both to Government and to the airline industry to process GTR's, which
is estimated to be $23 million annually, will be substantially reduced. The
cost of staffing and administering over 10,000 separate cashier operations
throughout the Federal Government, many of which exist principally to serve the
needs of travelers, can be substantially reduced by eliminating the use of
cash advances. More importantly, the Government can eliminate a major nega-
tive cash flow problem currently associated with cash advances, which at any
given time account for more than $250 million outstanding in obligations.
Problems such as employee delays in submitting claims for reimbursement and
failures to turn in unused tickets for refunds, delay
of obligated funds, should disappear i
process travel payment vouchers quickly and accurately.
The traveler will gain improved services such as toll-free customer assistance
access, 24-hour emergency card and travelers' cheque replacements. Federal
travel will be made easier, simpler, and consistent with prevailing practices
in the private sector. At the same time, charge card companies will be able
to provide much better management reports than those presently maintained in
order to aid you in controlling travel costs.
To assist you in better understanding this program, we have enclosed salient
portions of the solicitation issued by GSA on July 8, 1983. The solicitation
closes on August 8, and may result in separate contracts for charge cards and
travelers' cheques, or a single contract for both, based upon our evaluation
of the resulting offers. We expect to award the contract(s) in September in
order to meet the October 1 implementation date, and anticipate a relatively
rapid phase-in of additional departments and agencies commencing in 1984. We
look forward to working with you and your representatives in this regard, and
to better satisfying our mutual goal of improved services at a lower cost to
the taxpayer.
.L. L.trt1TCNELk ; i
 REQUIREMENTS CONTRACT
FOR
TRAVEL AND TRANSPORTATION PAYMENT SYSTEM
ANY INFORMATION THAT MAY BE DESIRED ON THIS PARTICULAR SOLICITATION CAN BE
OBTAINED FROM THE ISSUING OFFICE ADDRESS SHOWN HEREIN.
SOLICITATION COPIES. To reduce costs, only a single copy of this solicitation
is mailed to addressees on our bidders mailing list. If additional copies
are required, you may reproduce them yourself, provided they are complete in
every respect, or you may obtain them from the GSA Business Service Center, National
Capital Region, 7th and D Streets, SW., Washington, DC 20407, or from the
personnel listed on Page 5.
 A REQUIRED FORMS
B GENERAL TERMS AND CONDITIONS
C SUPPLEMENTAL PROVISIONS
D PROPOSAL FORMAT
E PARTICIPATING AGENCIES
F EVALUATION CRITERIA
G METHOD OF AWARD
 This is a requirements contract for a commercial travel and transportation payment
and expense control system which will provide travelers cheques and charge cards
for official travel and related travel expenses on a worldwide basis; attendant
operational and control support, and management information reports for expense
control purposes. The Federal agencies initially participating in the program and
the annual rate of business volume are listed in Section E. It is the Government's
intention to extend the coverage of this contract to all Federal agencies over a
3 year period. The first year's annual billings are estimated to be in excess
of the annual rate of $200 million. It is estimated that travelers cheque
annual billings under the contract could exceed $3.5 billion. These amounts
are estimates only and furnished to bidders for informational purposes only
and shall not be construed to represent any amount which the Government or its
employees shall be obligated to purchase or expend under the contract. Offerors
may submit proposals for either cards and/or travelers cheques and need not make
an offer for both products. Offerors must be capable of servicing the total
requirements contained in this solicitation on the item(s) for which offers are
subr.;itted. Cards and cheques issued under this contract will be used solely
for official United States Government business.
Historically, the Federal Covernment has purchased transportation relating to
travel directly from either common carriers, Scheduled Airline Traffic Offices
(SATO's) or commercial travel agents under contract to the Government. This
transportation has been paid for by Government Transportation Request (GTR) which
is an ordering and payment document. Travelers have been given a cash advance
to pay for lodging, subsistence, and miscellaneous expenses of between $50 and $75
in the coterminus United States per day based on the locality to which travel is
authorized. Entitlements can be higher for travel outside the coterminus United
States. The employee has not been precluded from exceeding allowances on a personal,
out of pocket basis. Upon completion of travel, the employee reconciles his/her
account with the agency finance office. The finance office pays the provider of
transportation directly and reimburses the employee up to the limit of authorized
expenditures.
Under the proposed system, vendors would be paid either by the card company
and/or with cash or travelers cheques as is appropriate. Not all travelers cheques
used by the Government will be procured through this contract. Federal travel
management centers under existing Government contracts may issue travelers cheques
in certain instances apart from the provisions of this contract. In most cases,
the card issuer will send its bill directly to the employee who is responsible
for the payment of his/her debt. Employees will continue to be reimbursed by
agency finance offices for their authorized expenditures. The Federal agency
will reimburse the travelers cheque issuer for cheques following their issuance.
Certain agencies or their organizational components may choose to have a limited
number of cards issued to specific offices within their organization with the
billings for these cards being sent directly to the agency for payment. In
these instances payment shall be made directly to the issuer by the agency finance
office.
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C-3. NECESSARY FINANCIAL CAPABILITIES.
The offeror must have sufficient financial capacity, working capital, and other
financial, technical, and management resources to perform. the contract. The
offeror shall understand that there may be a large number of diverse Federal
agencies participating in the Travel Payment System Program. The offeror should
understand that the system being procured is materially different from the way in
which the Government currently operates and that transition from its internal
system to a system operated by private industry can only be achieved effectively
through mutual effort. The offeror must be prepared to issue cards to Federal
employees at the Federal agencies direction without credit worthiness checks.
Individual Federal 'agencies may without incurring any liability therefore assist
in the collection process 60 days after initial billing if the individual traveler
has not paid his/her bills. It should be understood, however, that the Government
cannot withhold payments from an employee's salary to discharge bad debts. Since
payments will be made directly by the cardholder and not the Government for
cards issued directly to employees under Section C-4.a. of this contract, the
contract is not subject to the provisions of the Prompt Payment Act of 1982 for
payments made directly by the employee. Payments made by the agency finance
office are subject to the provisions of the Act.
The Government requires a transportation and travel payment system similar to
the commercially available level of service, which will have two distinct
components: (1) official charge cards, and (2) travelers cheques. The official
charge cards will be required as two differentiated products. One will be issued
and billed directly to named individuals, the second will be issued and billed
directly to Government agencies, bureaus, divisions, offices, or other organizational
elements.
a. The card issued to named individuals will be required minimally to have
the following product characteristics:
(1) Individual billing;
(2) No interest or late charges;
(3) Issuance at Government direction without prior credit approval;
(4) The Government shall not assume any liability for unpaid bills or
for lost and stolen cards;
(5) Bills shall be presented not more frequently than monthly;
(6) 21. hour emergency card replacement;
(7) Emergency personal check cashing capability;
(8) Bill adjustment capability with toll free telephone line
availability;
(9) No pre-set expenditure expense limit assuming no negative payment
history on in individual account;
 C-4. STATEMENT OF WORK (CONT'1) .
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(10) Broad geogr...iic range of acceptance at:
0 All domestic common carriers;
0 International common carriers;
0 Car rental agencies;
0 Lodging establishments;
0 Restaurants;
(11) Confirmed lodging reservations;
(12) Immediate ability to cancel organizationally issued cards;
(13) Ability to issue individual agency card after official notification.
c. Travelers Cheques.
(1) Broad range of acceptance by merchant establishments and financial
institutions.
(2) Same day refundability for lost and stolen travelers cheques
at specified locations.
(3) Wide range of denominations:
0 In prepacks from $50 per pack;
0 In lcose cheques if individual agency requirements so state;
(4) Inventory replenishment options such as:
0 Automatic replenishment to preestablished standard;
0 Toll free telephone line reorder capability.
C-5. CARD MANAGEMEi NT INFORMATION REQUIREMENTS.
The offeror must be currently capable of delivering management information
system reports on a timely basis or have a plan for providing MIS reports
on a timely basis. Offerors must be capable of furnishing MIS reports
in a variety of media such as e.g., microfiche or computer tape. The
following indicate the Government's minimum reporting requirements:
Monthly account activity listing all credits, charges to
individual account number and previous balance;
(h) Monthly individual charge activity identifying expenses by
category with current period and year to date totals;
(c) Monthly exception report identifying accounts where lost,
stolen, or canceled cards have current use and past balances;
 C-5. CARD MANAGEMENT INFORMATION REQUIREMENTS (CONT'D).
(d) Monthly aging analysis listing accounts past due by 60,
90, 120+ day history;
(e) Periodic account listing displaying all individual and agency
accounts by agency of individual user in alphabetical order;
(f) Monthly airline credit report identifying all credit transactions
including refunds by individual and agency account;
(;) Semi-annual supplier analysis aggregating dollar volume by supplier;
(h) Semi-annual airline analysis by city-pair in aggregate.
C-6. CARD ISSUANCE AND CANCELLATION.
Where the Government provides instructions to issue or cancel a card telephonically
written ce:;firmation will follow.
C-7. GOVERNMENT'S OBLIGATIONS.
This request does not commit the Government to award a contract or to pay any
costs incurred to the submission of proposals, or cost incurred in making
necessary studies for the preparation thereof, or to procure or contract
for services or supplies. The Government reserves the right to reject any
or all proposals, to negotiate with any offeror(s) considered qualified, or
to make award without further discussions.
C-8. UNNECESSARILY ELABORATE BROCHURES.
Offerors should limit the scope of their proposals to the requirements of the
Proposal Format (Section D). Unnecessarily elaborate brochures and other
presentations beyond that sufficient to present a complete and effective
proposal are not desired. Elaborate art work, expensive paper and bindings and
expensive visual and other presentation aids are neither necessary nor desired.
C-9. NONCONFORMING TECHNICAL PROPOSALS.
To be considered, the offeror must submit a definitive proposal, as requested
by this solicitation for the work to be accomplished under the proposed contract.
Proposals which merely offer to conduct a program in accordance with the general
requirements of the Government's Statement of Work (C-4) will be considered
nonconforming to this solicitation and will not be considered.
C-10. GOVERNMENT EMPLOYEE'S OBLIGATIONS.
Government regulations require employees to pay their just financial obligations
in a proper and timely manner pursuant to Section 206 of Executive Order 11222
(May 8, 1965), and Office of Personnel Management Regulations, 5 C.F.R.
735.207.
The appropriate Government agency office without Government liability,
may
assist in the collection process of individual deliquent accounts after
sixty days at the request of the contractor.
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a. Because of the potentially high volume of card contractor revenues
which this program is likely to generate, the Government does
not anticipate any fees being reguried by potential offerors.
However, in the event that an annual management fee is included
as a part of any offer, such fee shall be evaluated as one
of the factors in such offer. For travelers cheque offerors,
a remittance schedule and retained commission schedule, if any, will
also be evaluated as one of the factors in such offer. The Government
shall pay the contractor for supplementary services that it may
require from time to time, on a fee basis which shall be established
through negotiation.
b. Billing and payment procedures will be established with each Federal
agency receiving services under this contract. This provision applies
only to Sections C-4.b and C-4.c. of the Statement of Work.
The contract will be effective October 1, 1983, for twelve months. The
Government reserves the right at its sole option to renew the contract for
up to four additional twelve month periods. A notification of exercise of such
option shall be made at least thirty days prior to the end of each twelve month
period.
The Government reserves the right to require the successful offeror to place
an appropriate description on the face or reverse side of the card and/or
travelers cheque referencing this contract or the fact that the card is issued
at the direction of the General Services Administration or other Federal agency.
The contractor shall provide full time project management which would be
responsible for the administration, supervision and coordination of its operation.
C-15. CONTRACTOR'S CARD QUALITY CONTROL PROGRAM.
The contractor should identify minimum standards for card operations in the
following areas:
0 Inquiry response;
0 Issuance;
0 Replacement capability;
0 Billing procedure;
0 Credit collection;
0 Cancellation;
and for traveler's cheque operations in the following areas:
0 Inventory replenishment;
0 Refundability.
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C-1S. CONTRACTOR'S CARD QUALITY CONTROL PROGRAM (CONT'L,.
The General Services Administration shall be notified of aggregate customer
complaints and resulting corrective action in a monthly narrative report
to be furnished by the contractor with the MIS reports required in Section C-5.
C-16. CONTRACTOR-FLRNISHED EQUIPMENT.
The contractor shall provide all necessary office equipment, furnishings, supplies,
systems, communications services, and related items necessary to conduct its
operation, and in order to fulfill the contract requirements.
C-17. FACILITIES INSPECTION.
The Government will conduct on-site inspection of any or all facilities prior to
contract award.
C-18. GOVERNMENT'S ABILITY TO AUDIT TRANSPORTATION CHARGES.
The offeror must provide the Government with a complete listing of all common
carrier transactions including refunds and adjustments with the hard copy or
facsimile of all common carrier records of charge in order to enable GSA to audit
carrier charges to the Government pursuant to Section 322 of the Transportation
Act of 1940 (31 U.S.C. 3726), see also, 41 C.F.R. 101-41.101. Each monthly
report or record of charge must show the traveler's name and agency, date of
travel, and leg-by-leg routing showing origin and destination, carrier, class of
service and fare. This report must be sent monthly to United States General
Services Administration, Office of Plans, Programs and Financial Management,
Transportation Audits (BW), Washington, DC 20405. See also Section C-5(f).
C-19. GOVERNMENT RIGHT TO INSPECTION.
In addition to any other inspection clauses in this contract, participating Federal
agency offices of Inspectors General shall have access to all transactional
records under this contract.
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