Advertisement

You will be redirected to the page you want to view in  seconds.

Late fees for military shipping containers soar

Oct. 4, 2012 - 04:13PM   |   Last Updated: Oct. 4, 2012 - 04:13PM  |  
  • Filed Under

WASHINGTON — Late fees for unreturned shipping containers have soared to record levels over the past 13 months despite the military's plans to cut their costs, in part because the military recently discovered invoices dating back six years, according to the Pentagon.

Since late summer 2012, the military has paid shipping companies $188 million for failing to return containers on time. Last year, USA Today first reported on the late-fee issue — about $720 million from 2001 to 2011 — prompting calls from Congress to rein them in and a Pentagon plan that goes into effect Monday to contain costs. The peak year for overdue containers was 2004, when the military racked up late fees of $128 million.

The metal shipping boxes, ranging from about 20 feet to 40 feet in length, have been stuffed with gear and sent to war zones in Iraq and Afghanistan over the past decade. Once there, troops repurpose them for shelter, storage, even bathrooms. Fees mount because shipping firms charge daily penalties for unreturned containers. Under a rent-to-own arrangement, the Pentagon can pay nearly $7,400 for a container worth $3,200.

The late fees declined to $17 million in 2008 before rising again with the surge of troops into Afghanistan. They totaled $39 million for the 2011 budget year that ends in September. Fees spiked in the past 13 months because the Pentagon paid invoices that dated to 2006, said Air Force Lt. Col. Melinda Morgan, a spokeswoman.

"How is that even possible?" said John Pike, executive director of Globalsecurity.org, a defense policy website. "If my phone bill is a day late, my phone rings off the hook. This is too peculiar not to warrant a criminal investigation."

Scott Amey, general counsel for the Project on Government Oversight, said "poor financial management inside the government has been a problem for years, including late fees and duplicate payments. This type of problem is an inexcusable drain on public funds, yet the government is unwilling to correct its payment systems."

In January, Sens. Tom Carper, D-Del.; Scott Brown, R-Mass.; and Tom Coburn, R-Okla., told the Pentagon that it wasn't doing enough to cut the cost of late fees. A new shipping contract that extends the grace period for returning containers from 15 to 20 days and buying containers outright could save as much about $15 million.

This year, the Pentagon formed management teams to identify ways to reduce costs further, Morgan said. In August, the military issued guidance to commanders in the field about how to manage their use of containers.

"With these changes and efforts at all levels of the department, including theater teams that have pushed for better routine accountability and improved container data quality, we anticipate a reduction in container detention in the upcoming fiscal year," Morgan said.

Answers sponsored by RallyPoint

Join trending discussions in the military's #1 professional community. See what members like yourself have to say from across the DoD.

More In News

Start your day with a roundup of top defense news.

VA Home Loan
Rates

Search By:

Product Options:
Zip Code:

News for your in-box

Sign up now for free Military Times E-Reports. Choose from Money and Education. Subscribers: log in for premium e-newsletters.


This Week's Air Force Times

This Week's Air Force Times

Top TA & GI Bill schools
Most popular colleges cater to troops by taking classes to them

Subscribe for Print or Digital delivery today!

Classifieds
MilitaryTimes Green Trusted Classifieds Looking to buy, sell and connect on Military Times?
Browse expanded listings across hundreds of military installations.
Faces of valorHonoring those who fought and died in Operations Iraqi Freedom and Enduring Freedom.
hall of valorThe Hall of Valor is a searchable database of valor award citations collected by Doug Sterner, a Vietnam veteran and Military Times contributing editor, and by Military Times staff.
Woman who cried rape
(3 replies)
   Last Post: TJMAC77SP
        May 3, 2014 1:32 PM
   Last Post: garhkal
        May 1, 2014 5:03 PM
Cliven Bundy
(45 replies)
   Last Post: Chief_KO
        Apr 26, 2014 9:49 AM
Handbooks

All you need to know about your military benefits.

Benefits handbook

Guard & Reserve All you need to know about the Guard & Reserve.

guard and reserve handbook