old. They must be intelligent, of good character, and physically qualified to perform service. They must not have criminal records involving crimes such as those listed in § 521.3 (c) (2) (i) (e) or traffic records that indicate their driving of motor vehicles would be dangerous.

(ii) Supervision. Drivers must comply with all proper orders and instructions of the foremen of their vehicles that are consistent with safety. Safe operation of the vehicle is the responsibility of the driver.

(iii) Schedule of duty. Drivers' schedules must be arranged to comply with Interstate Commerce Commission safety regulations or Post Office Department regulations requiring sufficient rest periods between trips to assure alert, efficient operation of the vehicles.

(iv) Duties. A driver must:

(a) Comply with applicable provisions of subparagraphs (4) and (5) of this paragraph regarding operation of the vehicle and performance of service.

(b) Transfer mail as provided in subparagraph (6) of this paragraph.

(c) Immediately request instructions from the foreman of the vehicle when the highway on the designated route becomes impassable for any reason.

(v) Liability for accidents. The contractor and driver are responsible for accidents occurring in the operation of the vehicle. The Post Office Department is not responsible for damage caused by contract vehicles operated by contractors or their employees.

(3) Placing vehicles. A contractor must place highway post office vehicles at the terminals of the routes at the designated times.

(4) Operating vehicles. The contractor must:

(i) Furnish evidence of financial ability to cover liability for personal injuries in the amount of $100,000.

(ii) Know and comply with both intrastate and interstate laws governing the operation of motor vehicles.

(iii) Observe all safety measures for protection of the general public and operating personnel as prescribed by applicable State and Federal laws and regulations governing operation of motor vehicles, as well as the safety regulations of the Interstate Commerce Commission or those prescribed by the Post Office Department.

(iv) Observe schedules on all routes according to standard time unless otherwise specified.

(5) Performing service. The contractor must:

(i) Perform service promptly, reliably, safely, and without interruption. If he fails to do so after his attention has been called to delinquencies, the director, transportation division, may impose fines for past failures and order the removal of the driver and vehicle from the route. It may order the employment of temporary service at the expense of the contractor until he provides a satisfactory driver.

(ii) Perform service within the limit of the running time prescribed in the advertisement under which he submitted

bid.

(iii) Comply with all orders and instructions from the director, transportation division and the supervising postmaster.

(6) Transporting, transferring, and delivering mail. The contractor must:

(1) Transport all mail to the cubical or weight capacity of the vehicle, promptly, reliably, and safely. This includes foreign mail in transit across the continental United States or its territories.

(ii) Transfer mail between the vehicle and postal installations when the vehicle can normally be driven to a point within 150 feet of the door or tailboard space of the installation, or place the vehicle at the platform or loading dock of a postal installation to permit handto-hand exchange of mail between clerks in the door of the vehicle and clerks on duty at the installation. The director, transportation division, is expected to make reasonable adjustments in these requirements by agreements with postmasters and contractors to assure ontime operation.

(iii) Deliver mail to each intermediate post office on the route on both outward and inward trips unless otherwise instructed by the supervising postmaster.

(7) Transporting postal officials. The contractor shall transport on regular trips all duly accredited officials of the postal service, traveling on official business, on presentation of their credentials. The contractor or his driver must not make known to any person at any time the presence of a postal inspector in his vehicle or in the vicinity of the route.

(8) Transporting passengers. Contractors are prohibited from carrying passengers in highway post office vehicles, other than postal personnel and contractors' employees. Contractors' employees may be permitted to ride in the driver's compartment when traveling on company business directly related to highway post office service, when such travel does not interfere with safe operation of the vehicle.

(e) Extensions, discontinuances, and changes. The director, transportation division, may:

(1) Order an increase in service on any route.

(2) Change schedule of arrivals and departures in all cases, particularly to make them conform to connections with railroads and other mail routes.

(3) Discontinue, change, or curtail the service, to improve mail service or to serve public interest.

(4) Extend the service on a route to improve mail service.

(f) Forfeitures or contract annulment. See § 521.4(d) (3).

(g) Subcontracts. Contractors for highway post office service must not subcontract the service unless the subcontract is approved by the director, transportation division. Subcontractors must conform to all requirements stated for the contractor himself. Approved subcontractors must perform the same service required of the original contractor.

(h) Payments-(1) For regular service. See § 521.4(e) (1).

(2) Allowance for detours. See § 521.4 (e) (4).

(3) Readjustment of compensation. See part 526 of this chapter.

(4) Deductions for service omitted. See § 521.4(d) (4).

(5) Fine. When a contractor fails to comply with terms of the contract or when serious irregularities occur, the postmaster in charge of the mobile unit and the director, transportation division, will make every effort, by letter or by personal interview, to correct the situation. If the contractor persists in the irregularities, the transportation division may issue an order on Form 5440-C-D-E imposing a fine.

(6) Record of performance. See § 521.5. (i) Inspection of highway post office vehicles. Vehicles and equipment shall

be inspected by officials of the postal service to assure compliance with departmental instructions.

§ 523.3 Reports.

(a) Special reports of irregularities. Postmasters and other designated installation heads shall analyze trip reports promptly upon receipt, and issue a brief against the contractor on Form 5500, unless there is a satisfactory explanation, when the following irregularities occur:

(1) Gross negligence on the part of the contractor or his employees.

(2) Trips repeatedly not performed or service omitted.

(3) Delays of 30 minutes or more due to driver's failure to report or because of equipment failure. (Delays of less than 30 minutes may be briefed in unusual circumstances.)

(4) Heat and light failures of 30 minutes or more during one round trip. (5) Unsanitary and unclean conditions in the vehicle.

(6) Failure to provide potable water. (7) Loss or damage to mail or postal equipment.

(8) Failure of the contractor or his employees to follow reasonable instructions of postal officials or employees.

(9) Violation of postal laws or regulations.

(10) Failure to give proper supervision to performance of contracted service.

(11) Transporting as cargo matter due to be in the mail.

(12) Entrusting the vehicle to an unsuitable person.

The postmaster in charge of the mobile unit will review the irregularities reported along with the contractors' comments in section 2 of Form 5500; will conIsult with the contractors and take any corrective action possible. When such corrective action fails to cause the contractor to comply with the terms of the contract, the matter should be referred to the director, transportation division, with the complete file.

(b) Accident reports—(1) Contractor's reports. The postmaster to whom the highway post office is assigned shall require the contractor to submit reports of all accidents occurring when the highway post office is in scheduled operation. Copies of State, municipal, ICC, insurance carrier's accident report forms, or a narrative written report are acceptable.

(2) HPO supervisor's report. Accidents are reported to the postmaster to whom the highway post office is assigned on trip reports. See that each accident reported on trip report is followed by the contractor's report of accident. Form 1769, Supervisor's Report of Accident, must accompany trip report if postal employees are injured or Government property is damaged.

(3) Postmaster's reports. On receipt of accident reports the postmaster to whom the highway post office is assigned must:

(i) Advise the inspector in charge immediately of any accidents requiring inspection service attention.

(ii) Report serious accidents immediately to director, transportation division. (iii) Compare contractor's report with trip report.

(iv) Prepare and submit a brief abstract of accident to the director, transportation division, to include:

§ 524.1 Description.

Water route service is a contract service established by the Department to provide for the transportation of mail between post offices, or other designated points, via steamboats, or other powerboats, when land transport is unavailable or impracticable. It is operated under formal contracts, awarded after competitive bidding. In addition to transportation of mail, contracts may require: (a) Box delivery and collection

service.

(b) Sale of stamp stock.

(c) Delivery of registered, insured, certified and COD matter.

(d) Acceptance of matter presented for registration, certification, or insurance, or to be sent COD, and money with applications for money orders.

(e) Facilities for distribution of mail en route by postal clerks.

§ 524.2 Postal services provided.

(a) Exchange of mail. The contractor shall exchange mail with:

(1) All intermediate post offices and nonpost office points on the route, as stated in the advertisement, on both outward and return trips, unless otherwise instructed.

(2) Post offices established after the advertisement is issued. No additional pay is made in such instances if the distance is not increased.

(3) Post offices at each end of the route, unless the director, transportation division, has otherwise provided for such terminal service.

(4) Mail carriers on connecting routes, if necessary.

(b) Box delivery and collection service. Advertisements and contracts state whether box delivery and collection service is required. They also state the scope of such service. Instructions contained in part 159 of this chapter are applicable to water route service, so far as practicable. See also § 521.2(b) and (c) of this chapter.

(c) Acceptance of mail en route. Every mail carrier shall receive any mail presented to him, if it is properly prepaid by stamps, and deliver it at the next post office at which he arrives. No fees are allowed for this service.

(d) Other postal services. On routes where provisions of the contract require,

the carrier must sell stamp stock and transact money-order and registry business in accordance with instructions contained in the advertisement.

§ 524.3 Contracts.

(a) Contract terms. See § 521.3 (a) of this chapter.

(b) Obtaining bids. See § 521.3(c) of this chapter except § 521.3(c) (2) (i) (a) of this chapter as bidders for water route service are not restricted as to residence.

(c) Award of contract. See § 521.3(d) of this chapter.

(d) Contractor's responsibilities—(1) Providing equipment. Contractors must provide:

(i) Steamboats or other powerboats which are safe, suitable, and satisfactory to the Department.

(ii) The means recessary to transport all mail, regardless of size, weight, or increase in volume during the term of the contract.

(2) Performing service. Contractors shall:

(i) Carry the mail or supervise the service in person or by an agent.

(ii) Be held accountable for the acts and omissions of the persons to whom they commit the care and transportation of the mail and for careful and faithful performance of duties by those persons. They shall discharge any persons engaged in carrying the mail whenever the director, transportation division, requires that they take such action.

(iii) Carry the mail with certainty, celerity, and security.

(iv) Transport foreign mail in transit across the territory of the United States.

(v) Not carry, otherwise than in the mail, letters that should go by mail or transport any person engaged in carrying letters that should go by mail.

(3) Maintaining schedules. Contractors shall:

(i) Provide scheduled service satisfactory to director, transportation division.

(ii) Observe the schedule stated in the advertisement or such other schedule of like running time as may be directed by the transportation division having supervision over the route.

(4) Giving preference to mail. See § 521.3 (e) (3) of this chapter.

(5) Transporting postal employees and equipment. (i) Postal clerks may be assigned to water routes. The contractor

on those routes shall provide and fit up suitable space for their use in accordance with specifications in the advertisements.

(ii) Contractors shall furnish post office officials, on exhibition of credentials, transportation on trips handling mail between scheduled points on the mail route.

(iii) The contractor shall transport, without extra charge, all post office blanks, mail bags, lock and keys, and other postal supplies offered to him.

(6) Providing carriers.—(i) Qualifications. See § 521.3 (e) (7) (i) of this chapter.

(ii) Persons ineligible. See § 521.3(c) (2) (ii) (e) and § 521.3 (e) (7) (ii) of this chapter.

(e) Renewals, extensions, and changes without advertising—(1) Renewals. See § 521.3 (f) of this chapter.

(2) Extensions of contract period. See § 521.3(g) of this chapter.

Exten

(3) Changes in service—(i) sions of service. Service may be increased or extended by allowing a pro rata increase in compensation, but the contractor, if he prefers, may elect to relinquish the service on timely notice.

(ii) Reduction of service. Service may be curtailed or discontinued in whole or in part by allowing 1 month's extra pay on the amount of service dispensed with and not exceeding pro rata compensation for the service retained.

(f) Irregularities-(1) Deductions or fines. See § 521.4(d) (1) or (4) of this chapter.

(2) Forfeitures or contract annulment. See § 521.4(d) (3) of this chapter.

(g) Payments (1) Payments. See § 521.4(e) (1) of this chapter.

(2) Pound rate contracts. Claims for payment for service performed will be submitted by the contractor to the director, transportation division, each accounting period, on Standard Form 1034, Public Voucher for Purchases and Services Other Than Personal, with two copies of SF 1034A, Memorandum Copy of SF 1034, supported by an itemized statement of all service performed, rates per pound, and the amount due. The director, transportation division, will verify all items shown on the itemized statement submitted by the contractor with the reports submitted by the postmasters.

SF 1034 will be covered by certification of service on Form 5429, to the postal data center.

(3) Readjustment of compensation. See Part 526 of this chapter.

§ 524.4 Protection of mail.

See § 521.3 (e) (9) of this chapter. § 524.5 Record of performance.

See 521.5 of this chapter. In lieu of Form 5399, postmasters and other designated installation heads may be required by the director, transportation division, to maintain whatever records are necessary as evidence of service performed. § 524.6 Routes under administration of postmasters.

See § 521.7 of this chapter.

§ 524.7 Screening contractors, subcontractors, and certain employees. See § 521.8 of this chapter.

star routes on Form 5435, Advertisement for Mail Service. See § 521.3 (c) (1) of this chapter.

(c) Requirements for bidders. Bidders must meet the following:

(1) Age. Contract motor vehicle contractors shall not be under 21 years of age, and their assistants not under 18.

(2) Residence. See § 522.2(c) (2) of this chapter.

(3) Reliability. See § 522.2(c)(3) of this chapter.

(4) Dual employment. See § 521.3 (c) (2) (i) (b) and (c) of this chapter.

(d) Bid procedures. See § 521.3 (c) of this chapter. Form 5449-5449-A, Contract Motor Vehicle Service Bid and Bond-Work Sheet, is used in submitting bids for contract motor vehicle service. (e) Oaths. See § 521.3 (d) (9) of this chapter.

(f) Employment of assistants. Contract motor vehicle contractors must either personally supervise their contracts or employ competent supervisors who will personally supervise performance of the contracts. They may not assign or sublet their contracts without approval of the director, transportation division. They may employ assistants at their own expense. Assistants so employed must meet the minimum requirements shown in paragraph (c) of this section.

§ 525.3 Operation.

(a) Postal services provided. Contract motor vehicle contractors and their assistants must receive and dispatch mail according to regulations stated for mail messengers. See § 522.3(a) of this chapter.

(b) Instruction for contractors. Postmasters shall instruct contract motor vehicle contractors as to service requirements in accordance with instructions contained in advertisements.

(c) Changes in service.-(1) Extension. The director, transportation division, will issue orders for extension of contract motor vehicle service.

(2) Reduction. Postmasters shall report promptly to the director, transportation division, when contract motor vehicle requirements are reduced, so that a lower rate may be negotiated.

(d) Irregularities.—(1) Observation of service. See § 522.3(d) (1) of this chapter.