Military’s $17.9 Billion Moving Contract Off to Slow Start

A monumental $17.9 billion Global Household Goods Contract (GHC) designed to relocate military families faced hurdles before finally launching this summer. So far, only about 100 local moves have been executed, focusing on gradual expansion, as the U.S. Transportation Command (Transcom) collaborates with contractor HomeSafe Alliance. Domestic implementation is targeted by spring, while international shipments are delayed until at least September 2025. Despite initial positive feedback, the program faces skepticism from major moving companies concerned about compliance with the Federal Service Contract Act (SCA). This law complicates operations for independent contractors, who prefer not to be classified as employees, making compliance financially burdensome for moving firms. Experts from various companies emphasize the need for clearer guidance from Transcom and the Department of Labor to proceed without significant risks. The complexities of GHC highlight fundamental challenges in adapting policy to meet the nuances of the moving industry. As transportation professionals advocate for transparency and clarity in federal regulations, the path forward will require collaboration between government entities and industry stakeholders to enhance operational feasibility. Transportation companies involved in military moving services are facing significant challenges regarding compliance with the Federal Service Contract Act (SCA). Executives from various moving companies expressed concerns about the lack of clear guidelines from the Department of Labor on how to ensure compliance, particularly regarding the requirements for independent contractors. With the Department of Defense managing approximately 325,000 moves annually, the ambiguity surrounding SCA compliance poses risks to operations and profitability for these movers. Bill Lovejoy, president of Republic Moving and Storage, highlighted that he cannot participate in the program without being able to achieve profitability, as current offered rates are inadequate. Similarly, Tim Helenthal from National Van Lines and Steven McKenna from Allied Van Lines emphasized the difficulties in understanding the application of the SCA to their business models, creating fears about potential liabilities and financial instability. This situation underscores a broader issue within the transportation sector: the relationship between regulatory compliance and business viability. Transportation companies must navigate a complex regulatory landscape while maintaining operational efficiency, and without clear guidance, the risk of non-compliance becomes a looming threat. Striking the right balance between adhering to legal requirements and ensuring financial health will be crucial for the success of these companies moving forward.