1 in 5 Domestic DoD Household Goods Shipments Had Damages in 2018

January 15, 2020

This article by Karen Jowers originally appeared on Military Times, the nation's largest independent newsroom dedicated to covering the military and veteran community.

A new analysis shows that 21 percent of all domestic Defense Department household goods shipments in 2018 had at least one damage claim.

The report by the DoD Inspector General isn’t likely to surprise the many military families who complained loudly about their household goods shipments during that year’s moving season. They complained of unexpected delays in pickups or delivery, and about the quality of work by moving companies, resulting in loss and damage for some families.

The IG report also provides some insight into just how frustrated some DoD members may have been about their lost and damaged belongings. One DoD member filed a claim for $1 trillion — which was denied. Information was not available about whether that person was a military member. Another seven claims were filed for over $1 million, including one person who filed a claim for 22 damaged or lost goods, each valued at $1 million, to include a $1 million trash can, which was denied.

But the analysis also concluded that the U.S. Transportation Command — the command in charge of the process of moving the household goods of service members and other DoD personnel — doesn’t have reliable enough information to determine whether troops’ belongings are getting delivered on time, or whether their claims for damage and loss are being completed, according to the report.

While officials at TRANSCOM agreed with some of the recommendations of the report, they disagreed with some, such as the recommendation to issue warnings or letters of suspension to the moving companies within 14 days of missing the delivery date. While they agree with the ultimate goal of improving service for DoD members, issuing additional letters of warning “will not translate into improved service,” officials wrote.

The current system is “fundamentally flawed“ and will never generate the moving capacity, accountability and clear responsibility that DoD requires.

“Today, DoD does not have a formal contract with any of our current providers and cannot hold them accountable in any meaningful way,” officials wrote.

The command is currently moving toward a centralized approach which would transition the process for moving DoD members’ household goods to a single move manager, by the 2021 peak moving season.

Lack of finalized damage claims means money lost to DoD personnel when their belongings are damaged or lost. Some don’t follow through on their claims by taking them to their military claims office if the moving company doesn’t settle their claim satisfactorily, according to the report. In addition, some service members aren’t filing inconvenience claims for their out-of-pocket expenses for lodging, food and rental or purchase of household necessities when there are delays in getting their household goods at their destination.

For example, in reviewing a sample of 124 late shipments, auditors found that only 25 inconvenience claims were filed, for a total of $17,945. Auditors recommend TRANSCOM develop a program to help DoD members and families file inconvenience claims with moving companies within 14 days after a missed delivery date. They also recommend that officials review all household goods claims more than 60 days old and contact the DoD member to find out the status. If the member wants to pursue reimbursement, the claim should be transferred to the military claims office, auditors said.

Auditors were tasked with reviewing personal property shipment information for 2018, after a number of military families complained about their household goods shipments during that year’s moving season. That included a petition on Change.org started in the summer of 2018 asking officials to hold moving companies accountable for loss and damage in military families’ household goods shipments. As of Jan. 8, the petition had more than 107,000 signatures.

The DPS data showed that 21 percent of all domestic household goods shipments had at least one damage claim filed during fiscal 2018. Information was not available about how that compares with civilian moves. Although the IG report cited a statistic from the American Moving and Storage Association that about 20 percent of all civilian moves result in a damage or loss claim, an official with that association said the organization doesn’t track those numbers and didn’t provide that. The civilian percentage is likely significantly less than that for a variety of reasons, said John Becker, interim president of the association.

Becker said the military claims process has been a problem since it began under the Defense Personal Property Program. For example, some service members think they have filed a claim, but they haven’t, he said. They first have to do a loss and damage report, and then file a claim. “It’s been a difficult process,” he said, for service members as well as moving companies.

In addition, there have been issues with how the system tracks delivery dates, he said. For example, if the moving company doesn’t get notified by the truck driver that the shipment was delivered, it’s not entered into the system. The delivery dates can’t be back-dated.

In fiscal 2018, the Defense Personal Property System included nearly 176,000 shipments of DoD personnel within the continental U.S., at a cost of $1.3 billion for taxpayers. Of those, more than 37,000 shipments had at least one claim filed for lost or damaged household goods. Some had more than one claim: As of December 20, 2018, DoD members filed more than 40,000 claims for damaged or lost household goods.

Auditors reviewed information in the Defense Personal Property System, or DPS, a web-based system that supports the DoD Personal Property Program with shipment management, invoicing, damage claims, and quality assurance.

Of the nearly 176,000 shipments, more than 100,000 or 57 percent, were delivered within five days of the required delivery date — meaning about 43 percent were delivered late, at least according to the DPS data. But there are questions about the accuracy of the data.

But auditors found a number of inaccuracies. They reviewed more than 18,000 shipments that were delivered at least five days late, and had at least one claim filed for damage or lost belongings. Of those shipments, more than half were processed by the top four joint shipping offices – Mid-Atlantic, Southeast, South Central and North Central.

When they reviewed nearly 9,900 shipments at those four joint shipping offices that were identified in the system as being delivered late, auditors found that moving companies actually had delivered nearly 5,700 of those shipments on time. IG auditors recommend that TRANSCOM require validation of the delivery information in the system within 14 days of the completed move.

The DPS also inaccurately identified 342 of 793 damaged household goods claims as still in process, when they should have been identified as closed. This happened because the moving companies and DoD personnel didn’t update their information in DPS when the household goods claims were finalized, auditors stated, and the shipping offices are not required to review household goods claims data.

Auditors recommend that TRANSCOM officials update the Defense Transportation Regulation to review all household goods claims greater than 60 days old and contact the DoD member to determine the status. If the DoD member wants to pursue reimbursement from the moving company, the shipping office should counsel the member to transfer the claim to the military claims office for processing. In their response to this recommendation, TRANSCOM officials agreed to update the regulation to require shipping office personnel to help military families with the claims process.