“Eliminate reliance (and associated expense) on commercial TPPS”
That bullet point is from a slide entitled “DP3 Reform Overview and Objectives” presented during the recent Personal Property Forum (PPF). It indicates that USTC is considering a significant change in the DOD HHG invoice and payment process. The current TPPS (short for Third Party Payment System) is USBank’s Syncada payment platform, formerly known as PowerTrack. In short, it appears USTC is considering moving away from using Syncada for DOD HHG invoice payments, and moving toward having the government make payments directly.
In response to a question about the bullet point, Rick Marsh, Director of the Defense Personal Property Management Office, indicated they were reassessing use of the TPPS for financial reasons. He indicated that at the 1.6% fee, over $30 million was paid for the use of the TPPS and with Service budgets being constrained, it made sense to look at alternatives.
Chuck White, President of the International Association of Movers, indicated that while he was supportive of trying to save the 1.6% cost, it was important to the industry that payments be made in the same time frame as the current process. Mr. Marsh indicated that he believed the government could make payments quickly, citing the recent stimulus check distributions as an example.
Mr. White also asked whether this is something that would be implemented only under the GHC contract, or if the plans are to bring it into the current program. Mr. Marsh indicated that it wasn’t limited to any particular “business construct,” and it is something they are looking at addressing over the next couple of years department wide.
Bill Reed from DFAS then addressed the issue, and pointed out some challenges of moving away from using a TPPS. Mr. Reed highlighted the differences in regulations between the government directly making a payment and a payment made by US Bank. Among the points made by Mr. Reed were the need for the government to have the obligation on its books and pre-validated before payment could be made. He expressed concern that those requirements could delay payments to the industry.
Mr. Reed also questioned Mr. Marsh’s categorization of the $30+ million savings by pointing out the costs are borne by the TSPs, not the government. Mr. Marsh responded by saying that he believes that the $30+ million gets passed onto the government through TSPs rates. He then closed the discussion by stating that while there were a lot of things to consider and stakeholders to consult with a change like this, “nothing that is worth doing is ever easy.”
