U S Bank Freight Payment Third Party Payment

U. S. Bank Freight Payment Third Party Payment System for United States Government Agencies Next Generation Delivery Services (NGDS) Gov’t Trans Policy Council Meeting 11 May 17 Proprietary and Confidential 1

U. S. Bank Freight Payment – Pioneered electronic freight payment with Department of Defense in 1998 to deliver 100% Pre-Payment Audit in accordance with MRM 15. Over two dozen patents granted. leader transportation payment services – • Global 200+ Fortune 1000 in clients, Best in Class commercial depended on by the world’s largest shippers including: – Integrated with Transportation Management Systems and Enterprise Resource Planning (ERP) and accounting systems for seamless audit, payment, cost allocation, accrual and posting – World Class Cyber Security – One of only 8 Tier 4 Data Centers in U. S. − 98% electronic processing via EDI - eliminated paper processes − 10, 000+ In Network carriers in all modes − 20, 000+ end users in over 20 countries − Payments made to carriers in 49 countries and 14 currencies – Award winning customer service – Headquarters in Minneapolis, MN Proprietary and Confidential 2

U. S. Bank Freight Payment – Overview • Third Party Payment Service (TPPS) for Do. D and other Federal Agencies. • U. S. Bank pays over 48, 000 Freight and Small Parcel payments daily for DOD, DOS, DHS, and HHS • No cost to any Federal Agency plus ability to earn rebate and 30 -day terms no interest • Small Parcel Payments specialization for NGDS Do you really know all the unknown charges of your Small Parcel process? Proprietary and Confidential 3

U. S. Bank Freight Payment – NGDS TPPS Advantages for Federal Agencies Process Improvements Cost Savings Fully Automated Electronic Payment Reduces labor and Paper costs Quarterly Incentives to Agency Prompt Payment Interest Savings & 30 day terms Cost Savings & Efficiency Proven Setup Process—U. S. Bank performs transition. Carrier Coordination 100% Audit Cyber Secure Data Retention How the process works Proprietary and Confidential 4

Federal Agency Proven Savings—A Case Study Current Client, $12 MM Spend/1. 7 MM Packages annually Agency Improvement Savings Opportunities U. S. Bank Enablers Agency Potential Annual Savings Estimated Savings Per $12 million Spend Annually Automated Cost Recovery • • Service Level Validation Guaranteed Service Refunds Manifested Not Shipped Contract Verification 2% to 3% of annual Small Parcel Spend $300 K-$425 K or $. 17 -$. 24 per package Process Improvement Savings Opportunities • • • Air to Ground charges Consolidation shipments Address Corrections Declared Value Early AM Charges Lost/Damaged Packages 5% to 10% of annual Small Parcel spend $1. 1– $1. 5 million or $. 59 -$1. 29 per package Total Cost Oversight and Compliance • • Fully loaded costs Weight corrections (DIM) Saturday Fees Delivery Areas /Extended Area Surcharges Reduce internal costs Receipt of invoices, validation, data entry, GL coding, audit, contract maintenance, exception handling, reporting, and payment $3. 00 - $10. 00 per invoice 1 File Turn Incentive & Cash Management Extend DPO by 30 days enabled by U. S. Bank Trade Finance PLUS Incentives + 15 days added (30 days under TPPS contract) Budget compliance Potential savings for proposed model: 1: American Shipper 2016 Transportation Payment Benchmark Study. $3 - $10 automated, $20 - $30 paper Proprietary and Confidential Ability to carry out Agency mission $170 -250 K $ 460 K ~ $1. 1 – $3 million per $12 million spent annually 5

How to Participate with U. S. Bank Third Party Payment System Options, Efficiency and Ease of Procurement • Automated cost recovery • Gain visibility and improve control • Improve process efficiency • Deliver greater savings and value • Enhance strategic decision making Option #1 Option #2 Option #3 Agency Direct with U. S. Bank DOD/USTRANSCOM GSA Smart. Pay Tier 2 Jeremiah Otting Jeremiah. Otting@usbank. com (651) 235 -5510 Contracting Officer Debbie Young 618 -220 -7157 (DSN 770) deborah. m. young 8. civ@mail. mil Jeremiah Otting Jeremiah. Otting@usbank. com (651) 235 -5510 Jeff Lineberger Jeff. Lineberger@usbank. com (210) 587 -9416 Sean Joyce Sean. Joyce@usbank. com (612) 430 -4528 Program Manager Kevin Welk, DFAS 317 -212 -3463 kevin. p. welk. civ@mail. mil Proprietary and Confidential Jeff Lineberger Jeff. Lineberger@usbank. com (210) 587 -9416 Sean Joyce Sean. Joyce@usbank. com (612) 430 -4528 6

U. S. Bank Freight Payment Demonstration Small Parcel Payments for Federal Agencies Proprietary and Confidential 7