Having a well-defined travel policy is important to your employees, managers, accounting staff, contract customers, and auditors. A one-size-fits-all policy may be suitable for some companies, while others may benefit from having multiple policies focused on the business base and/or contract requirements.
When performing work on government contracts, adopting the GSA travel guidelines as the basis for travel reimbursement and contract charging is a commonly adopted approach, since so much information has already been gathered on various related topics. However, keep in mind that this was developed for the Defense Department’s Civilian and Uniformed Services’ employees, and therefore could cause contractor employees to misunderstand what are or are not allowable expenses on a Government contract. Most often, travel expenses submitted for reimbursement by employees of the company are fairly cut and dry. But there are other times when unique situations or requests come up which your company hasn’t addressed in your policy, or perhaps know little or nothing about. Hopefully you will find a gold nugget of wisdom within the information provided below.
Are you using the correct location as the basis for employee per diem rates? Per GSA.gov, traveler reimbursement is based on the location of the work activities, and not the specific accommodations. If lodging is not available at the location of the work activity, and obtaining lodging outside of that area is costlier, be sure to document the justification for the excess lodging expense. A few examples could include a special event during (and at) the travel location, or traveling with government personnel for which the customer is providing local transportation. Adding the justification information to the lodging receipt will help to minimize questions by both internal and external auditing personnel.
Airfare: Coach-class accommodations are the accepted standard (301-10.123); however, did you know if the traveler has a special need or medical disability, their condition may qualify them for first class accommodations? Have the employee obtain a written statement from a competent medical authority with specific information detailed in GSA.gov 301-10.123(a)(2)(i). Another exception to the coach-class rule is OCONUS travel in excess of 14 hours. This includes stop overs and changes of planes, and assumes the traveler must report to work duty the following day or sooner.
If your traveler is commuting by private plane, GSA.gov provides a flight mileage rate. Origin to destination distance can be obtained from the website for U.S. Department of Transportation’s Inter-Airport Distance (www.transtats.bts.gov). Any additional air mileage resulting from adverse weather, mechanical difficulty, or other unusual conditions should be documented with an explanation (301-10.302). In addition to the mileage allowance, the traveler can claim expenses such as airport parking, landing and tie-down fees (301-10.304). Costs would be limited to the cost of a commercial flight.
Rental Car Expenses: Unless your traveler is transporting additional passengers or equipment, a mid-size vehicle or smaller with unlimited mileage is the accepted standard. Purchased rental car insurance is not an allowable expense to pass on to your government customer, nor are any expense related to personal days. Requiring your employees to have a separate rental agreement for personal days is the best way to keep any personal expense totally separate.
POV Expenses: Travel by use of a privately owned vehicle (POV) can be very cost effective. According to the Joint Travel Regulations (JTR), it has been determined that travel to locations within 800 miles or less (round trip) can be authorized at its discretion. As a contractor, it should not be assumed this discretion also applies to you. Airfare costs can sometimes be very competitive, so be sure to conduct and document a price analysis comparing POV travel to air travel. Any tolls, fees, lodging, meals and incidental expenses incurred due to POV travel should be considered, while air travel should also include local travel expenses (rental car, cabs, etc.) once the traveler reaches the destination. Including this analysis as backup documentation to the traveler’s travel expense report will show your company’s commitment in providing the best cost value to your government customer.
Conventional lodgings (hotel/motel, etc.) is most often reimbursable at a single occupancy rate using the GSA.gov lodging location rates. So what if a traveler wants to utilize unconventional lodging instead? If the traveler has access rights to stay at government quarters, the actual fee paid for use of the quarters is reimbursable. In order to claim lodging expenses when staying with friends or family, the traveler would need to either substantiate any costs their host incurs in accommodating them, or have a company travel policy that permits a fixed rate (e.g. $25.00) as a gratuity to the host.
Did you know excess airport parking fees can be disallowed if they exceed the cost of taxi fare to/from the terminal? Be sure your company’s travel policy addresses this obligation to your government customer.
Implement a Thorough Travel Expense Policy
As you can see, there are several aspects of travel reimbursement which must be addressed regarding business travel reimbursement. Be sure that you have “covered all your bases,” considering a variety of situations where unique travel or lodging options may present themselves. Understanding GSA.gov guidelines during the creation of your policy (or policies) will help prevent gray areas arise later. The team at Redstone Government Consulting, Inc. are well-versed in GSA travel guidelines and can help you ensure your policy is complete, including proposal and pricing support, contract negotiation and review. Contact us to create and manage policies which will fit within the guidelines.