Federal Supply Service

Commissioner

Frank P. Pugliese, Jr.
Deputy Commissioner
Donna D. Bennett
Assistant Commissioners
· Jon A. Jordan
Controller
· Gary Feit
Business Management and Marketing
· Patricia M. Mead
Contract Management
· William N. Gormley
Acquisition
· Raymond J. Hanlein
Chief Information Officer
· John R. Roehmer
Distribution Management
· Allan J. Zaic
Transportation and Property Management

Employees: 3,436
Revenue: $2.8 billion -
General Supply Fund
Other Funding
· $26.9 million - Appropriated (Direct)
· $0.3 million - Appropriated (Reimbursable)

The Federal Supply Service (FSS) provides Federal agencies with $14.2 billion a year in direct and contract support, fleet services, travel and transportation services, and disposal of excess personal property. FSS makes these available-predominantly on a reimbursable basis-through its four business lines:

·Supply and Procurement

·Fleet Management

·Travel and Transportation

·Personal Property Management.

Supply and Procurement

In FY 1997, Supply and Procurement programs made it possible for FSS customers to purchase more than $8.1 billion worth of commercial products more easily, with faster delivery and at significant savings. The reimbursable costs of operating these programs continued to decline overall, and dropped from $4.67 per $100 sales in FY 1996 to $4.48 per $100 in FY 1997.

FSS offers more than 4 million commercial items, including office equipment and supplies, paint, tools, furniture, vehicles, and an array of commercial services such as charge cards, temporary clerical assistance, and financial management services. Making products more accessible and easy to obtain, GSA has introduced GSA Advantage!TM, its 24-hour Internet-based Government shopping service at www.fss.gsa.gov. Customers can shop for the items they need, select delivery options and place their orders electronically. They can pay using an IMPAC/VISA Card or a GSA account number and be assured of the highest level of security. Sales on GSA Advantage!TM grew from $5.7 million in FY 1996, its first full year on-line, to $28 million in FY 1997.

FSS offers three methods of professional buying and delivery services.

The FSS Stock Program sales were $880 million in FY 1997. Over 18,000 items are economically procured in bulk and redistributed to Federal customers worldwide through 11 distribution centers. The reimbursable costs per $100 sales increased from $24.04 in FY 1996 to $28.11 in FY 1997, as sales for this program declined by 12% from $990 million in FY 1996 and costs increased marginally. These developments can be attributed to Department of Defense downsizing and commercial credit card ordering. Increasingly, Stock Program customers are changing from centralized logistics, procurement, and administrative offices to mission managers. From a Governmentwide perspective, agencies are benefiting from lower administrative costs and inventory investments by relying on FSS.

Special Order sales rose to $1.5 billion in FY 1997, 7% higher than FY 1996 sales of $1.4 billion. The Special Order program provides products related to special needs or those for which stocking is not desirable but consolidated contracting and ordering is beneficial-e.g., vehicles, appliances and furniture. Shipments are direct from vendor to user. FY 1997 sales included $519 million in purchases for the FSS Interagency Fleet Management System.

Federal Supply Schedules provided a record $5.6 billion direct from vendors. Federal Supply Schedules cover goods or services characterized by the need for broad choice or rapidly changing technology. Customers order from commercial vendors, receive delivery and pay for their orders directly, benefiting from the terms and conditions negotiated by GSA. FY 1997 was the first full year the FSS Schedules Program was covered by an industrial funding mechanism. Because the program is significantly different from the Stock and Special Order Programs, which have been industrially funded for a decade, a distinct cost recovery method was devised for Schedules. Though all costs of the program were successfully funded in FY 1997 through a 1% fee on Schedule sales remitted to FSS by contractors, the new procedures helped identify needed improvements in the reconciliation of sales data and fee payment. In addition, FSS is developing an electronic process that will rely on quarterly Internet reporting of sales and electronic funds transfer instead of paper processing.

FSS Simplifies Procurement

Through its direct service delivery and skilled contract negotiations, FSS facilitates procurement for Federal agencies. FSS contracts with vendors and its direct supply services-such as its Customer Supply Center telephone ordering and new "virtual stores"-let agencies obtain products and services with a minimum of paperwork and delays. In addition, FSS contracts provide charge cards that facilitate routine purchases for Federal agencies, travel for Federal employees and driving Federal vehicles. In FY 1997, GSA Advantage!,TM the FSS on-line catalog, let agencies shop and place orders for over 310,000 products with a few keystrokes. GSA's objective is to minimize the effort required for Federal workers to get what they need to do their work. By simplifying procurement, we help them focus their energies on accomplishing their own missions.

The FSS Multiple Award Schedule (MAS) program, under which FSS awards contracts to multiple vendors of a broad array of products and services, has experienced the greatest growth for FSS sales. Reengineered to simplify ordering, relax small dollar procedures, reduce prices and improve delivery times, this program is highly popular with FSS customers. Drawing on its MAS contracting expertise, FSS has distinguished itself in contracting for services. These include management, organizational and business improvement services, equal opportunity and employee relocation services. Multiple award schedules for professional temporary support services, auditing and financial system services will be available in FY 1998.

FSS contracts for Government charge cards to pay for products and services. Beginning with the travel card it has provided since 1983, FSS has contracted for charge cards that simplify Federal procurement, employee travel and vehicle use, and eliminated administrative processes that would have cost an estimated $616 million in FY 1997. In addition, use of the cards provides regular management reports with a clear audit trail.

The next generation of purchase, travel and fleet cards will offer a variety of products and services through many different card service providers. The new programs will provide flexibility, richer transaction detail and state-of-the-art technology while streamlining payments. New five-year contracts will be awarded in early 1998, bringing closer the day when all card services might be integrated in a single card.

The popular IMPAC/VISA Purchase Card is used by 264,505 Federal workers Governmentwide. In FY 1997, the card was used to make over $4.9 billion in Government purchases, 69% more than in FY 1996. The number of cardholders rose 26% from 209,295 in FY 1996. Use of the IMPAC/VISA card brought $7 million in refunds that were allocated among user agencies for the year ending July 1997.

American Express Travel Cards offer savings, convenience, documentation. Federal employees purchased $3.6 billion in travel and related services in FY 1997, using American Express Travel Cards provided through FSS. Individually billed travel cards are issued to Federal employees, reducing administrative costs for Government travel and providing information that can be used to monitor travel funds. Refunds of $20 million were paid to the Government in FY 1997 and distributed proportionally among the user agencies. The number of travel card users increased 7% from nearly 1.4 million in FY 1996 to nearly 1.5 million in FY 1997, continuing a steady rise in the use of Government travel cards.

Interagency Fleet Management System

The Interagency Fleet Management System (IFMS) provides vehicle services to 75 Federal agencies, offering a modern fleet and timely replacement of vehicles, low lease costs, professional maintenance management, and a selection of alternative-fuel vehicles. It is the largest civilian U.S. Government fleet outside the Postal Service.

GSA's fleet size is growing. IFMS business volume totaled $787 million in FY 1997. During the year, GSA's fleet size increased with the consolidation of 4,795 vehicles, including the first 1,650 vehicles from the Army-Europe's non-tactical fleet. The remaining vehicles were consolidated from the Marine Corps, the Army Corps of Engineers, the Navy, NASA and the Environmental Protection Agency.

Over the past 11 years, GSA's fleet has grown by nearly 61,000 vehicles to total 155,000 automobiles, passenger vans, light, medium and heavy trucks, buses, ambulances and special purpose equipment. In FY 1997, annual savings attributable to consolidations grew to $58 million. The IFMS now manages 41% of the Government's vehicle inventory and will consolidate another 11,000 vehicles by FY 2000.

GSA contracted with Wright Express Corp. in FY 1997 to provide Fleet Service Cards for users of Government fleet vehicles. These are the first Government-provided commercial charge cards for use in purchasing fuel and services for its fleet vehicles. In addition to the cards provided for use with the 155,000-vehicle GSA fleet, FSS also provided cards for 175,000 customers from more than 75 other civilian agencies. Use of the cards helps fleet managers identify unauthorized purchases, time and place of purchase, and fuel consumption, and provides other information essential to efficient fleet operations.

GSA provides the most economical, effective and efficient fleet management. IFMS provides Federal agencies with automobiles at lease prices as low as $146 a month, plus fuel and mileage, for a 4-door sedan. Reimbursable costs per mile increased 4% to 28.5 cents for FY 1997. Most of the higher cost can be attributed to a one-time increase in reported petroleum expenses for FY 1997. Lower-than-expected proceeds from sales of IFMS used cars was another factor.

GSA Maintenance Control Centers (MCCs) provide immediate advice on vehicle maintenance. IFMS customers and maintenance and repair vendors rely on the trained automotive technicians at the MCCs to give advice and approval on maintenance and repairs of fleet vehicles. In FY 1997, to ensure a prompt customer response, the IFMS installed a new calling system that extends hours of service and virtually eliminates hold time. In the past, maintenance operations were controlled by regional MCCs. Now, customers and vendors alike can access IFMS technicians and vehicle repair histories through a single nationwide toll-free number.

IFMS Pioneers Alternative-Fuel Technologies. GSA's Fleet Management program helps implement new and advanced automotive technology, in the spirit of the Alternative Motor Fuels Act of 1988, the Clean Air Act of 1990, the Energy Policy Act of 1992 and various Executive Orders. GSA has been proactive in development of alternative fuel vehicles (AFVs), purchasing over 14,500 AFVs since 1991. It has been instrumental in moving AFVs from test units to production line vehicles and in organizing a refueling site infrastructure, especially ethanol and methanol refueling sites in the Midwest and California.

The GSA fleet provides vehicles for emergency and special use. GSA provided over 300 fleet vehicles to the Secret Service, the State Department and various other agencies, during the June 1997 G-8 Summit meeting in Denver.

Travel and Transportation Services

FSS helps control and reduce Federal costs through its commercial travel and transportation programs. Travel services include negotiated airline contracts, travel agency services, hotel and motel discounts, and a travel expense payment system. Transportation services include the shipment of parcels, freight and household goods.

FSS programs save billions in travel costs. Federal employees spent $8 billion on travel and related services in FY 1997. By leveraging the size of the Federal travel market, FSS is able to negotiate favorable prices for Government travel and accommodations and offer significant savings through several programs:

The Contract Airline City-Pair Program provided airfares at 62% discounts. This program offered Federal travelers unrestricted discount airfares on 6,100 routes that yielded $2.4 billion in savings in FY 1997 under contracts with 18 commercial airlines. Rates negotiated for FY 1998 will save 70% over full, unrestricted fares and produce an estimated $2.65 billion in savings. Discounts will be available on only 5,800 routes, however, apparently reflecting about 300 routes found to be less economical or unprofitable to the airlines, and changes in government travel patterns.

Travel Management Centers (TMC) cut administrative costs. The TMC program enables Federal agencies to shift the administrative burdens of arranging travel from in-house staff to commercial travel agents at no cost to the Government. Use of Travel Management Centers also ensures that Federal travelers take advantage of City-Pair and other cost-saving programs.

FSS provides low-cost shipping services for Federal agencies through industry-negotiated agreements and contracts with private sector providers. These include next-day and second-day express small-package deliveries, freight shipments and transport of relocated employees' household goods.

FSS customers saved $82 million on overnight and second-day deliveries. Federal shippers sent over 17.9 million shipments in FY 1997 at rates 44% less than the cost of comparable corporate customer service. Small-package business volume totaled almost $101 million in FY 1997, over 36% more than the $74 million spent to send 11.6 million shipments in FY 1996. Federal Express holds the contract for Government small-package delivery. It offered two new services in FY 1997-second-day delivery and overnight delivery by 10:30 a.m.-with a money-back guarantee if delivery is even one minute late. The contract also provides for weekend and holiday pick-up and delivery.

FSS-negotiated agreements saved $47 million on freight shipments, with motor carriers charging FSS customers 45% less than regular tariff rates.

FSS agreements with household goods carriers save 49% on employee moves. Government agencies spent a total $62 million in FY 1997 to relocate employee households. Savings from this program are estimated to be as high as $73 million based on equivalent commercial rates.

FSS oversees audits of Federal freight and passenger transportation vouchers to recover or avoid excess charges. Government transportation costs were reduced by $3 million by auditing transportation bills prior to payment. Savings have exceeded $37 million over five years.

Personal Property Management

FSS manages and operates an asset management program for Governmentwide personal property through its utilization, donation, and sales programs. Reuse of Government-owned property saved taxpayers over $1.9 billion by avoiding new purchases and making the most of the investment already made.

FSS transfers excess property among Federal agencies. Under this program, property no longer needed by one agency is screened for use by others. In FY 1997, property having a replacement value of approximately $1.1 billion was transferred among agencies, thereby avoiding an outlay of Federal tax dollars for new purchases.

Property unneeded by the Federal Government may be donated to State Governments for use by public agencies and certain nonprofit, tax-exempt activities, saving State and local tax dollars. Of the $617 million in this category in FY 1997, over $7 million went to public and nonprofit agencies that assist the homeless.

Surplus property no longer needed by the Government is sold to the public. In FY 1997, sales totaled $216 million. This includes the "exchange sale" of Government-owned personal property where sales proceeds are applied to offset the cost of replacements. Vehicles, furniture, computers, cameras and tools are some of the most popular items sold.

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