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GSA Negotiates New Travel Management ContractsFederal Government, Travel Agencies, Small Businesses to Benefit

GSA #9620

November 22, 1999
Contact: April Kaufman 202-501-1231


WASHINGTON, DC - In new contracts with 46 travel agencies, the U.S. General Services Administration has changed travel management services for federal travelers, giving agencies more choice in travel agencies and available services.

"These contracts show just how flexible and responsive GSA is," said GSA Administrator Dave Barram. "We've adapted to the marketplace and given agencies more choice in their travel management services. Furthermore, GSA's new travel management contracts will benefit many small businesses."

The new contracts:
-Give federal agencies choices among several service providers in each geographic area.
-Make more customized services available.
-Take advantage of technological advances for travel management services.
-Benefit small businesses.
-Make services fee-based.

Give federal agencies choices among several service providers in each geographic area. The new contracts contain 50 contract line items for service on a nationwide basis or by 49 various geographical areas. Between 2 and 13 firms were awarded contracts to provide service in each area. Contract effective dates will vary by geographic area, with new contracts phased in as existing contracts expire.

Make more customized services available. GSA's federal customers can select from several individually priced value-added services for which they are charged only when used. Such services include customized management reports to help them assess their travel budgets and on-site operations.

Take advantage of technological advances for travel management services. As new technologies are developed, travel agents may add them to their GSA contracts. Making new services available to federal agencies gives them flexibility to adapt to continual changes in the travel industry.

Benefit small businesses. Providing maximum opportunity for small businesses to participate was a major goal in this procurement. Nineteen small businesses, including 6 small, disadvantaged businesses, and 13 small, woman-owned businesses successfully competed for one or more awards. Fifteen line items were set aside for small businesses, and one line item was set aside for competitive 8(a) procurement.

Make services fee-based. Airlines have cut ticket sales commissions by half over the past few years. Because revenue from sales generally supported travel agencies' operations, firms have increasingly found themselves forced to charge fees for services they provide. GSA's new travel management contracts reflect this shift in the marketplace by providing transaction pricing for travel services.

Federal agencies will pay a fee for each transaction. The fee covers all basic services, including issuance of an airline or rail ticket, hotel and rental car reservations and standard management reports. Federal agencies will be refunded the commissions that travel agencies receive from common carrier sales.

Ceiling price fees range from $14.00 - $49.50 for domestic and $14.00 - $98.50 for international travel. Because these are ceiling fees negotiated in the master contract, when agencies award task orders for their travel management services, they generally negotiate significantly lower fees.

As always, federal agencies must have a task order in place to receive travel management services under the new contracts. Agencies will issue task orders and select their own provider or providers based on prices and services offered.

GSA worked closely with its federal customers and travel industry partners to create a procurement approach that would give the government the best value and fairly compensate travel agencies. The contract follows commercial practices and ensures continued quality travel services.

For a complete list of travel management service providers and their service areas, go to http://www.region9.gsa.gov/fss/tmcservices.
Pricing and services offered by each contractor will be posted at a later date.