This article by Wyatt Olson originally appeared on Stripes.com. Stars and Stripes serves the U.S. military community by providing editorially independent news and information around the world.

The Defense Department’s effort to streamline its global system of shipping service members’ household goods is meeting resistance from the moving industry and a federal lawsuit challenging the bidding process for a multibillion-dollar contract.

The system overhaul would consolidate oversight and management to a single contractor that oversees and manages all domestic and international relocations for the military, Coast Guard and federal employees.

Single oversight is intended to increase customer satisfaction and tamp down costs, but many in the moving industry have balked. They compare the contract terms unfavorably to the current system.

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In November 2021, U.S. Transportation Command awarded a $20 billion contract to Houston-based HomeSafe Alliance LLC to handle the work being done by more than 900 commercial entities for roughly 300,000 moves a year.

More than three years later, the rollout of the so-called Global Household Goods Contract, or GHC, has made little headway, with growing resistance by much of the industry.

As of Monday, HomeSafe had completed a meager 607 household goods deliveries, according to an email Wednesday from the U.S. Transportation Command in response to a written query.

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“Initially, I think industry was kind of split on whether GHC was going to be a good thing or a bad thing,” Katie McMichael, executive director of Movers for America, a coalition pushing back on GHC’s implementation, said in a phone interview Jan. 8.

“But I think what we’ve seen with the rollout of GHC is there have been a lot of areas that really were not well thought out,” she said.

‘Damaged Goods’

The effort to streamline moves was sparked by a spate of complaints in 2018 by service members over late arrival of shipments, damaged goods and a lack of clarity on whom to blame for the failures.

Problems arising under the GHC model would rest on the shoulders of the sole entity overseeing relocations: HomeSafe Alliance.

Under GHC, HomeSafe, a joint venture between Tier One Relocation and KBR, formerly Kellogg Brown & Root, will eventually replace the roughly 900 forwarding agents who have until now handled military moves.

Forwarding agents — sometimes called transportation service providers — orchestrate domestic and international moves by hiring movers, truckers, ocean shippers and warehousing. In some cases, forwarding agents own subsidiaries to do that work.

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“They’re creating something that’s never existed,” said Anthony Shipp, president and CEO of Hawaii-based M. Dyer Global, which is among those 900 forwarding companies.

If such an all-encompassing agent could have made a go of it, “it would already exist,” Shipp, who opposes GHC, said during a Jan. 7 phone interview.

“To this day, there’s no player in the market that would do something like that,” he said.

GHC will put his company’s forwarding operations, which account for about 25% of its revenue, “completely out of business,” Shipp said.

“So that’s one reason why we’re opposed,” he said.

The GHC contract for the use of his company’s trucks and warehouse space come with fixed rates “not favorable to us” and “an enormous amount of liability that doesn’t exist in the current program,” Shipp said.

“So, when you kind of put all that together, it just doesn’t make business sense for us to do it,” he said. “No mover really wants to sign up for that.”

‘Proprietary’ Rate Info

The Movers for America alliance primarily objects to the payment rates offered under the GHC contract and to complications arising from the federal Service Contract Act that could force moving companies to treat independent truckers as employees.

U.S. Transportation Command is leaving the issue of compensation to HomeSafe.

“Regarding rates, as the prime contractor for GHC, HomeSafe is responsible for building a sub-contractor network to fulfill contract terms to include sub-contractor compensation,” the command wrote in its email.

“It is important to note, specific information on rates is contract proprietary between HomeSafe and the providers in their network,” the email states.

As to the issue of independent contractors and truckers, little wiggle room exists because GHC is a Federal Acquisition Regulation-based contract, according to the command’s email.

To comply with that regulation, HomeSafe and its subcontractors must pay at least minimum wage and furnish fringe benefits to workers, the email said.

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McMichael said the industry has received “no guidance” from the Transportation Command, the Department of Labor or HomeSafe on how this impacts workers.

The bottom line for the alliance is that the entire GHC overhaul is ultimately unnecessary because the current system is working smoothly.

“The current program is seeing record high satisfaction rates,” she said.

“So, at this point, we really don’t support GHC moving forward because it’s over budget and behind in the timeline. It seems like a massive waste of taxpayers’ money.”

Target Missed

In a November 2022 news release, the Transportation Command had projected that by the peak 2024 moving season “all domestic and international household goods and unaccompanied baggage shipments” would move under GHC.

After almost entirely missing that target, the command’s current projections are modest and “subject to change.”

“The DOD is planning to activate all installations in the continental U.S. by spring 2025,” the command wrote in its email. “International shipments under GHC are expected to begin no earlier than September 2025.”

A federal lawsuit filed by several moving companies late last year could further slow or even derail GHC.

The Suddath Companies, a major player in military relocations based in Jacksonville, Fla., filed suit Nov. 22 in the U.S. Court of Federal Claims alleging that Transportation Command violated the bidding process for GHC by changing terms after it was awarded.

Two additional companies joined the suit, with the plaintiffs asserting they would have submitted more favorable bids under the altered terms of service.

The lawsuit alleges that HomeSafe has been given almost four times as long to implement the program as was set out in the bid solicitation and provided an additional $60 million to fund implementation.