Final Conference Defense Spending Bill from Congress Kills MEADS

Despite threats of a veto from the Obama White House the current conference version of the 2013 Defense Authorization Bill will end the MEADS program. The final version of the law cuts the last planned $400 million expenditure on the new, joint air defense system.

The Medium Extended Air Defense System (MEADS) was being developed by the U.S., Italy and Germany as a replacement for the PATRIOT system made by Raytheon (RTN). Lockheed Martin (LMT) is the lead contractor for the MEADS system. The Administration and Congress have already agreed that newer versions of the PATRIOT will suffice and work on MEADS would end. The dispute is that Congress decided that there was no reason for funding in FY13 rather then completing that year of work.

Italy and Germany had wanted to continue the program having provided several hundred million dollars of funding over its life stretching back to the Nineties. Not only will there be fall out internationally from this decision it is estimated that paying out contract termination fees and close out costs would probably be close to the planned $400 million in funding.

The program had been in its test phase and had recently had some successes.

Unfortunately in the potential fiscal situation new programs that are yet to enter service are the ones that face the biggest cuts as it is possible to utilize some of the things developed but by avoiding production and deployment large amounts of funding are saved. While the Administration wanted that last year of funding it seems clear that Congress intends to not provide it in the FY13 bill.

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Agreement Reached on Latest Production Order for Lockeed’s F-35 JSF

The Pentagon and Lockheed Martin (LMT) signed a deal on Friday for the latest production order for the F-35 Joint Strike Fighter (JSF). The F-35 is the newest combat aircraft for use by the U.S. Navy, Air Force and Marine Corps as well as many allied nations across the world. It will slowly begin replacing the Eighties’ generation F-16, F/A-18 and A/V-8A tactical aircraft.

The contract is worth about $4 billion and will buy 30 F-35 aircraft in the three variants being developed. This includes 21 Air Force Conventional / Take Off and Landing (CTOL), 6 carrier based aircraft and 3 Vertical Take Off and Landing (VTOL) versions for the Marines.

Last fiscal year advanced procurement was awarded in the amount of roughly $500 million last year. This was was for 38 aircraft but after negotiations and the price challenges the JSF program is facing only 30 ended up being bought in the full production contract.

Lockheed along with many other defense contractors is involved in complex discussions with the Defense Department as to how to apportion risk and its costs. The Government would like more transferred to the contractor and obviously the contractor would like to minimize that. In June the Senate tried to write language into the defense authorization bill requiring a fixed price contract for this production buy but this was resisted by both Lockheed and the DoD.

The JSF program while slowly ramping up production still has a lot of testing and development to go. Traditionally this has required a Cost Plus based contract as Lockheed cannot necessarily predict how much work needs to be done or its cost. The Government would assume most of the risk at this stage due to the immaturity of the aircraft and the potential for changes to requirements and configurations. The desire to transfer the risk to the contractor is motivated by saving money but it could drive up bids and costs as well as reduce competition and delay contract negotiations and awards.

The JSF has had its share of cost, schedule and testing troubles. It is moving a lot slower then originally intended and will cost more then planned. The need for a new aircraft, though, is great as the U.S. has an aging F-15, F-16, and F/A-18 fleet. Cancelling the JSF as some have discussed would just mean either a new, existing aircraft would have to be bought or another development program would be started. Without significant changes in requirements the cost would be the same, if not more, if this course was pursued.

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Reports that Initial F-35 Production Batch Costs Over Target Costs

Yesterday Senator John McCain (R-AZ) caused a stir by tweeting that the Pentagon had requested $264 million as part of a reprogramming as a “downpayment” on the cost overruns for the the first three production batches of the F-35 Joint Strike Fighter.

He also said that the total cost would be closer to $800 million. As with a many programs at the stage of the acquisition cycle Lockheed Martin’s (LMT) F-35 is in the government and contractor share cost increases beyond the target or ceiling price. Reportedly this cost increase applies to the first 28 aircraft ordered by the Defense Department.

The Defense Department and Joint Project Office have yet to confirm McCain’s information.

The F-35 is an advanced tactical aircraft being developed to replace F-16, F/A-18 and A/V-8A aircraft currently in service with the U.S. Air Force, Navy and Marine Corps as well as for many U.S. Allied nations. It is the largest defense acquisition program ever planned to date and has suffered from cost and schedule growth due to testing and development issues.

The production buy currently being planned will be the fourth batch and the largest. There has been frustration over the cost increases with the program by many in Congress and especially McCain. The Senate Armed Services Committee recently added to the 2012 Defense Authorization Bill specific language for the F-35 limiting the government’s exposure to cost overruns. The bill if it becomes law after conference with the House would require Lockheed to be responsible for all cost increases past the target price rather then the Government and it sharing in them.

McCain also attempted in Committee to add language that would have allowed the Government to terminate the program if cost increases for the next production lot exceeded ten percent. That vote failed in committee but by only one vote. This illustrates the concern many have for the increased costs the program is facing.

If the contract was cancelled the U.S. would be faced with buying more Boeing (BA) F/A-18 or non-U.S. aircraft or even re-starting the F-22 production line to meet the requirement while a new fighter program was started.

The chances of terminating the contract are low due to the amount of money already invested in it. A more likely scenario is reduced quantities or a longer production run due to cost and funding limitations.

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Senate Tries to Negotiate Next JSF Contract with Lockheed Martin

When a company signs any contract they spend a great deal of time negotiating it with the other party. This is true not only of defense contractors and the government but in any contract. The decision on terms and conditions as well as price may take several months. Now Lockheed Martin (LMT) may be forced to sign a contract for the Joint Strike Fighter (JSF) where the terms and conditions will be dictated by the U.S. Senate.

In the recent Defense Authorization bill passed out of the Senate Armed Services Committee (SASC) for the consideration of the full Senate specific conditions were levied on the JSF program’s next contract. This is fairly unprecedented but indicates how high the level of concern there is with the performance of the program for this new combat aircraft program led by Lockheed.

The Joint Strike Fighter is the largest defense acquisition program in the history of the world. It will buy thousands of modern, stealthy aircraft to replace the aging Eighties fleet of F-16, F/A-18 and A/V-8 aircraft used by the Air Force, Navy and Marine Corps. Many allied nations will also purchase it to replace their F-16 aircraft. The F-35 Lightning II JSF will be made in three variants and ultimately cost the U.S. billions to produce and sustain over the next forty years.

The program has a history of sustained cost and schedule increases as development and testing has turned out to be longer and more complicated then originally thought. Over the last three years the program has been re-baselined and redesigned to account for some of problems but still faces many challenges to achieve its scheduled timeline. Many in Congress, the media and the aviation community have become increasingly concerned about this cost growth and how it will ultimately affect the production and delivery of the aircraft.

Due to these concerns the SASC added two very specific provisions to the 2012 defense authorization bill relative to the JSF. The authorization bill combined with the appropriations bill from the Senate Appropriations Committee tell the Pentagon how much money they have to spend and how it should be spent. Once the bills are approved by the Senate they go to a conference committee with the House to produce the final bills.

These provisions require the next annual production contract for the F-35 to be a fixed priced one with Lockheed absorbing any cost increases over the contracted amount. (http://www.defensenews.com/story.php?i=6845494&c=air;%20budget;%20policy&s=TOP) This is rather unique contracting decision because at this stage in the life of a defense program there remains enough uncertainty that fixed prices are hard to define and agree on. That type of contract is more commonly used when the production line is fairly stable and little or no development effort remains. Lockheed is currently under a fixed price contract but it will received fees for good performance. The contract also has a provision that the maximum the government will pay is 120 percent of the target price.

The second requirement that Lockheed will have to absorb cost overruns is something that will be hard for the company to accept at this time. When a program is in the testing and development stage the Government and the contractor make an effort to share the risk. This means that cost increases due to delays or technical issues are spread between the two parties. In the current contract any cost over the 20% increase would be covered by Lockheed with the Government accepting the cost growth risk to that point. The Senate is proposing that the contractor accept all of the risk meaning Lockheed would begin losing profit immediately.

The JSF is entering into dangerous territory. There is beginning to be extreme concerns about the cost of the program especially when the U.S. budget is facing such pressure due to the needs to reduce the annual deficits. The 2012 budget will include almost $7 billion to buy 28 aircraft for the U.S. military. Some in Congress are now discussing alternatives to the program which would require a different aircraft or approach. Ending or scaling back the program would be huge blow to the U.S. military who are counting on the JSF to provide a major technical upgrade as well as replace many aging systems. The U.S. ended production of the F-22 their last most recent tactical aircraft program in 2009. If there is no JSF they would have to consider re-starting that production, upgrading existing aircraft or looking overseas for a new fighter.

At the same time it is unprecedented for Congress to wade into the minutiae of details in contract negotiation like this. Lockheed and the Defense Department must decide on the best contract vehicle to achieve the goals of the program. The program has issues but dictating to Lockheed a situation where there ability to make money which is their goal will make it difficult to award the contract. These provisions will make it more difficult to negotiate the next production contract potentially stretching out the program even more as well as setting a precedent that will make other companies think twice about beginning programs. There is a chance that competition will be reduced causing further price problems for the Pentagon.

Article first published as Lockheed Martin Now Negotiating Contracts with the United States Senate on Technorati.

Photo from ngotoh’s flickr photostream

Pentagon Ordered to Buy American for Green Technology

One of the provisions contained in the Defense Authorization Bill for this fiscal year passed at the end of Congress’ lame duck session is one that extends the Buy American requirements for the Defense Department to solar panels. The rule makes the Pentagon only consider U.S. sources for this piece of “green technology” in their contracting efforts.

The Federal government procurement laws and regulations put a whole host of restrictions on contracts issued by the Pentagon for hardware, services and support. These include the Berry Amendment and Buy American Act. These are used to support U.S. industries by granting them privileged status and providing them a ready market.

The Berry Amendment for example requires prime contractors and their subcontractors to purchase or use food, clothing, tents, cotton, woven silk and other fibers or articles made out of them only from U.S. suppliers.

The Buy American Act has been in existence since the Thirties and requires preferences for American produced or manufactured goods.

While the U.S. Government should be supporting domestic sources at the same time it can force cost or schedule implications to a program. Especially with the change in the world’s economy over the last fifty years there may not be a domestic manufacturer or source for a product. The laws are waived in this case but that causes a potential schedule change or cost growth to a program. The domestic source may also be more expensive driving up the total cost of the procurement.

These kind of social engineering attempts within defense and government contracts are worthy but like the rules pertaining to small businesses or minority owned they may have a cost or efficiency affect. They are also vehicles that may be abused through companies selling non-U.S. material as U.S. made or taking advantage of the efforts to reward certain types of businesses. There have been many cases over time of companies pretending to meet certain criteria that they don’t thus gaining an advantage in sole source or direct contract awards.

The rule about using U.S. solar cells may have the same affect. The industry like so many others is turning to China and a great deal of the world’s production capacity is in that country. U.S. companies have been reducing their footprint and this may make it hard for the Pentagon to find a source capable of delivering the product on time or at the necessary cost.

This illustrates the issue where Congress wants to get the most for their defense dollars but at the same time by favoring a supplier may be forcing the Defense Department to buy something that they could get at a better price or in a more timely fashion.

Photo from sjsharktank’s flickr photostream.

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Obama Administration Wants Secret “Blacklist” for Pentagon Contractors, According to the American Small Business League

PETALUMA, Calif.--(BUSINESS WIRE)--The Obama Administration has included language in the defense authorization bill that may allow senior Department of Defense (DoD) officials to secretly “blacklist” government contractors.

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Effort to Add EADS Subsidies Consideration to Defense Authorization Bill Fails

Senator Murray (D-WA) and Senator Brownback (R-KS) attempted to attach an amendment to the Senate’s 2011 Defense Authorization Bill today that would force the Defense Department and U.S. Air Force to take into account the World Trade Organization (WTO) ruling on subsidies to EADS (EADS:P) by European governments. Due to the fact that the bill did not win enough votes to advance mainly due to the attempt by the Democratic leadership to add the repeal of “Don’t Ask/Don’t Tell” policy on gays in the military the amendment wasn’t considered.

The two whose states stand to gain several thousand jobs if Boeing (BA) wins the KC-X contract will have to wait for this bill to be re-considered or add the amendment to another one. Certainly there are Senators from Alabama and other Southern states who favor EADS who might try to work against the amendment.

Currently the U.S. military cannot consider these kind of trade disputes and rulings in their source selection which is why the attempt was made to add the rule.

This continues to show that the fight for this contract will continue in Congress, the media and across the internet.

Federal Government Continues Moves to Restrict Native American Contracts and Companies

The Federal Government has a program called “Section 8(a)” that is used to favor small businesses. This rule allows the award of sole source contracts to companies meeting certain requirements. The idea is to grow small businesses through this simpler award process and also aid disadvantage groups. The 8(a) rules favor those contractors owned by women, minorities and service disabled veterans. The restriction on the program is that the size of the contract is limited to under $20 million since the goal is jump start small companies into larger ones.

One of the legacies of Senator Ted Stevens (R-AK) was a rule that Alaskan Native American companies could win a contract of any size. He had this change made in the defense bills. This has allowed those corporations to grow and win contracts over not only other 8a companies but also traditional contractors as well. This rule had raised the hackles of other Senators and in the last few years there has been movement to eliminate the rule favoring Alaskan companies.

Not only that but one of the reforms that the Obama Administration is trying to accomplish is the reduction in the number of sole source contracts awarded. The goal with that reform is to gain more competition, better pricing and ultimately save money. The use of sole source contracts makes an award process simpler and easier for the contracting command involved as it shortens the time line since there needs to be no competition. There use is often justified to gain speedy awards. These changes are putting pressure on all Native American owned companies but especially Alaskan ones who may see a significant decline in their work if the government does limit awards and increase competition.

The most recent Defense Authorization Bill included a limit of sole source contracts to $20 million dollars without requiring extended approval and justification. This change will make it harder to award these contracts quickly which may lead to more competitions among non-8(a) companies. The Defense Department is meeting with Native American groups to discuss these changes and their affects.

The government is also facing problems because of a recent court case that ruled that HUBZone companies take precedence over other small businesses. Since few Native American corporations are in Historically Underutilized Business Zones which are normally in large urban areas this ruing will also limit their chances of getting sole source awards. This means that Native American companies may have to compete for these contracts as if a HUBZone company wants the business and it is decided to sole source it they must get it.

The government has in the past justified these contracts as a way to help disadvantaged groups at the cost of a small amount of inefficiency and the chance of slightly higher prices. The current deficit situation and the desire to increase efficiency as well as Steven’s exemption of his home state businesses have led to a reevaluation of these processes. The end result may be a significant decrease in the amount of work these companies now get from the government or increased costs for them as they must bid on contracts. Either result limits the effect of the Federal spending on their communities which was the whole point of the program in the first place.

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House Adds Language to Force Pentagon to Consider Subsidies to Defense Authorization Bill

The House of Representatives in their vote on the 2011 Defense Authorization Bill added an amendment sponsored by Washington and Kansas members to force the Pentagon to consider the WTO ruling on illegal subsidies when it comes time to consider EADS’ (EADS:P) bid. The Pentagon has made it clear in the past that their contracting and acquisition laws and regulations do not allow them to factor that into their cost evaluations. This language if it is in the final version of the bill when it is passed after Conference will supposedly make them do that.

One question though is the Air Force plans to receive bids on July and announce a decision in the late Fall. There is a good chance that the source selection if it follows that schedule will be complete before the bill makes it out of Congress. While the Authorization Act often is done before the Appropriations one it is often not complete by 30 September as it should be. The Pentagon could also argue to ignore the language setting up some sort of court fight. EADS could also adjust their prices to take into account the effect of the WTO ruling.

House Armed Services Committee: House Approves FY11 Defense Authorization Bill

May 28, 2010 by · Comment
Filed under: Syndicated Industry News 
House Armed Services Committee: House Approves FY11 Defense Authorization Bill
Ike Skelton, Chairman
May 28, 2010

Washington, DC – House Armed Services Committee Chairman Ike Skelton (D-MO) released the following statement after the U.S. House of Representatives approved H.R. 5136, the National Defense Authorization Act for Fiscal Year 2011, by a vote of 229 to 186.

“This year’s defense authorization bill makes record investments in our nation’s military, authorizing a $726 billion budget to further strengthen our national security, provide our men and women in uniform with the tools they need to do their jobs, and take care of our service members and their families. The bill provides the resources we need to sustain two wars today and be prepared for the wars of tomorrow – whenever and wherever they may be.

“This defense bill makes counterterrorism a priority, improving the ability of our military to protect themselves at home and abroad and providing them with the additional tools they need to disrupt, dismantle, and eventually defeat al Qaeda and its extremist allies. The bill increases funding to restore military readiness that has been strained by two wars, and also demonstrates our commitment to service members and their families by providing a pay raise and other benefits recognizing the personal sacrifices they make to keep our country safe and secure.

“This is an excellent bill and I want to thank the members of the House and particularly the members of the House Armed Services Committee for their efforts to make this the best bill possible for America’s national defense. Next, we await the Senate’s action on the defense authorization bill and look forward to sending a first-rate defense bill to the President for his signature.”

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House Armed Services Committee: Skelton remarks on H.R. 5136, The National Defense Authorization Act for Fiscal Year 2011

May 27, 2010 by · Comment
Filed under: Syndicated Industry News 
House Armed Services Committee: Skelton remarks on H.R. 5136, The National Defense Authorization Act for Fiscal Year 2011
Ike Skelton, Chairman
May 27, 2010

Washington, DC – House Armed Services Committee Chairman Ike Skelton (D-MO) delivered the following remarks during general debate on H.R. 5136, the National Defense Authorization Act for Fiscal Year 2011:

“Madam Chair, I rise in support of H.R. 5136, the National Defense Authorization Act for Fiscal Year 2011. I am pleased to be joined here today with my friend, Buck McKeon. Buck has been a true partner in this effort to bring forward a bipartisan bill that addresses the national security needs of our country. The committee passed the defense authorization bill by a vote of 59 to 0.

“H.R. 5136 authorizes $567 billion in budget authority for the Department of Defense (DoD) and the national security programs of the Department of Energy (DoE). The bill also authorizes $159 billion to support ongoing military operations in Iraq and Afghanistan during fiscal year 2011. These amounts are essentially equal to the President’s budget request for items in the jurisdiction of the Armed Services Committee.

“H.R. 5136 continues Congress’s deep commitment to supporting U.S. service members and their families and to provide the necessary resources to keep Americans safe. The bill provides our military personnel a 1.9 percent pay raise, an increase of 0.5 percent above the President’s request. The bill also includes a number of initiatives to support military families, including extending health care coverage to adult dependent children up to age 26. We also have the single most comprehensive legislative proposal to address sexual assault in the military.

“The bill also fully funds the President’s budget request for military training, equipment maintenance, and facilities upkeep, which continues the committee’s efforts to address readiness shortfalls that have developed over previous years. The bill provides an increase of $12 billion above the fiscal year 2010 budget for operation and maintenance, including $345 million to fully fund the first increment of construction necessary to modernize DOD schools, $13.6 billion for training of all active-duty and reserve forces to increase readiness, and an increase of $500 million for day-to-day operations of Army bases, which has a direct impact on our soldiers. It also provides an increase of $700 million above the Administration’s budget to address the equipment shortfalls in National Guard and Reserve units

“The war in Afghanistan is a critical mission that is essential to our national security. To ensure that our strategies in both Iraq and Afghanistan are effective and achieve the intended goals within well-defined timelines, the bill requires the President to assess U.S. efforts and regularly report on progress, including providing timelines by which he plans to achieve his goals. It also extends the authorization of the Pakistan Counter-Insurgency Fund through fiscal year 2011 to allow commanders to help Pakistan quickly and more effectively go after terrorist safe havens. The bill also provides $1.6 billion for coalition support fund to reimburse nations that are providing logistical, military and other support to our troops in Iraq and Afghanistan.

“On Iraq, the bill upholds Congress’s responsibility to provide oversight to the process of drawing down the mountain of material purchased, transported, and built up in Iraq at tremendous expense to the taxpayer.

“In the area of nonproliferation, the bill continues our focus on keeping weapons of mass destruction and related materials out of the hands of terrorists, and strengthens our nonproliferation programs and activities. The bill increases funding for the Department of Energy’s nonproliferation programs, and adds funding to continue the Administration’s plan to secure and remove all known vulnerable nuclear materials that can be used for weapons.

“There are lots of other good things in this bill, which my colleagues will cover. I want to recognize the members of the House Armed Services Committee for their contributions in making this bill one of the best that the committee has put forward in recent years.

“Madam Speaker, our nation has been at war for nearly a decade. Our troops are worn and their families are tired and the nation recognizes their sacrifices. This bill addresses many of the concerns that they have raised. I urge my colleagues to support our troops and their families, and vote for the defense authorization bill.”

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House Armed Services Committee: Skelton Welcomes Congressman Mark Critz

May 25, 2010 by · Comment
Filed under: Syndicated Industry News 
House Armed Services Committee: Skelton Welcomes Congressman Mark Critz
Ike Skelton, Chairman
May 25, 2010

Skelton Welcomes Congressman Mark Critz to House Armed Services Committee

Washington, DC – House Armed Services Committee Chairman Ike Skelton (D-MO) released the following statement on the appointment of Congressman Mark Critz (D-Pa.) to the House Armed Services Committee:

“I extend a warm welcome to Congressman Mark Critz of Pennsylvania as the newest member of the House Armed Services Committee. Congressman Critz’s assignment to the Armed Services Committee will allow him to focus on supporting our men and women in uniform and protecting our national security. I look forward to working with him as our committee continues its work on this year’s national defense authorization bill.”

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House Armed Services Committee: House Armed Services Committee Approves Fiscal Year 2011 Defense Authorization Bill

May 24, 2010 by · Comment
Filed under: Syndicated Industry News 
House Armed Services Committee: House Armed Services Committee Approves Fiscal Year 2011 Defense Authorization Bill
Ike Skelton, Chairman
May 19, 2010

House Armed Services Committee Approves Fiscal Year 2011 Defense Authorization Bill

Washington, DC – House Armed Services Committee Chairman Ike Skelton (D-Mo.) announced that H.R. 5136, the National Defense Authorization Act for Fiscal Year 2011, was reported favorably by the committee on a vote of 59 to 0. A detailed summary of the bill as reported is available here.

H.R. 5136 authorizes $567 billion in budget authority for the Department of Defense (DOD) and the national security programs of the Department of Energy (DOE). The bill also authorizes $159 billion to support overseas contingency operations during fiscal year 2011, and authorizes $34 billion for fiscal year 2010 supplemental appropriations for overseas contingency operations in Afghanistan, Iraq, and to provide humanitarian and disaster assistance to assist victims following the earthquake in Haiti.

Skelton released the statement below following the committee’s approval of the defense authorization bill:

“This defense bill aligns our military strategy with the 21st century to sustain the 2 wars today and prepare for the threats of tomorrow – whatever and wherever they may be. The bill reflects our continued commitment to defend America, support U.S. service members and their families, and keep Americans safe.

“The bill makes counterterrorism a priority, improving the ability of our military to protect themselves at home and abroad and providing them with the additional tools they need to disrupt, dismantle, and eventually defeat al Qaeda and its extremist allies. The bill includes funds to implement the initial recommendations of the Fort Hood Follow-on Review conducted by the Department of Defense in the wake of the shooting at Fort Hood. The bill also addresses urgent force protection needs in Afghanistan, allowing DOD to cut through red tape by expanding rapid acquisition authority to deliver the resources needed to protect our troops.

“The bill enhances the capacity of the U.S. military, particularly the U.S. Special Operations Forces, to act directly against terrorist organizations. The bill also builds upon past efforts and creates new initiatives to discredit extremist ideology, increasing funds for research and taking additional steps to counter the use the Internet by extremists.

“Recognizing the important role that foreign nations play in helping us succeed in our fight against terrorists, the bill expands funding to build the partnership capacity of foreign military forces to participate in support of military and stability operations. The bill authorizes Coalition Support Funds to reimburse nations providing support in connection with the wars in Iraq and Afghanistan and with the broader counterterrorism and counterinsurgency mission in Pakistan to fight against al Qaeda, the Pakistan Taliban, and other violent extremists. The bill also extends the authorization of the Pakistan Counterinsurgency Fund to ensure the success of efforts to build the counterinsurgency capabilities of Pakistan’s security forces.

“Earlier this year, the President implemented a new counterinsurgency strategy in the way in Afghanistan to reverse the downward momentum from nearly a decade of no real plan under the previous administration. To better reflect these changes in the U.S. strategy, the bill requires a new semi-annual report on trends and developments in Afghanistan and requires reporting on progress in stopping the momentum of the Taliban and their allies, building the capacity of the Afghan National Security Forces, and building the capacity of the Afghan government.

“The bill also continues close Congressional oversight of operations in Iraq, requiring reports focused on the redeployment of U.S. troops and their equipment over the next few months, and on the development of military capabilities that are necessary for the Government of Iraq to stand on its own.

“The bill prepares America to deal with 21st century threats, moving away from the Cold War mindset to adopt smarter policies on issues such as missile defense and nonproliferation. The bill provides $10.3 billion, $361.6 million above the budget request, for ballistic missile defense and in support of the Administration’s Phased Adaptive Approach, which addresses immediate needs. To prevent the spread of weapons of mass destruction and to reduce the risk that these weapons could fall into terrorists’ hands, the bill fully funds the DOD Cooperative Threat Reduction (CTR) Program and the DOE’s nonproliferation programs, which includes funding for the President’s effort to secure within four years all known vulnerable nuclear material around the world that can be used for weapons.

“Our military personnel are the heart and soul of our national security, and this bill makes sure that our troops and their loved ones are receiving the first class benefits that they deserve. To improve the quality of life for our forces and their families, the bill provides a 1.9 percent pay raise for all service members, continuing our efforts to reduce the pay raise gap between the uniformed services and the private sector. The bill also increases the maximum amount of hostile fire and imminent danger pay for the first time since 2004, and increases family separation allowance for our service members whose deployment or temporary duty requires them to live away from their families.

“The bill includes provisions based on the recommendations of the Defense Task Force on Sexual Assault in the Military Services, reflecting the committee’s commitment to protecting service members by improving DOD’s sexual assault prevention efforts and response to victims.

“The bill also allows TRICARE beneficiaries to extend coverage to their dependent children until age 26, the same benefit that was afforded to individuals with private insurance policies under the new health care law. Other initiatives to support military families include $345 million to modernize DOD schools, $65 million for Impact Aid education programs, and the creation of a new career development pilot program for military spouses.

“The strain of two wars has taken a toll on military readiness. To boost readiness and reduce the strain on our forces, the bill increases the size of the military by 7,000 Army troops and 500 Air Force personnel, and recognizes the Navy’s need to temporarily remain at a higher force size, which reflects the President’s budget request. The bill significantly increases Operation and Maintenance (O&M) funding to support the daily operations, training, and administration of U.S. military forces at home and abroad

“The bill also provides critical funds to restore equipment stocks, including $9.9 billion for Army and Marine Corps equipment reset and depot maintenance, $4.5 billion for depot maintenance of active and reserve Air Force aircraft, and $109 million for Navy ship and aircraft depot maintenance. To address National Guard and Reserve equipment shortfalls, the bill authorizes $7.2 billion to provide aircraft missiles, wheeled and tracked combat vehicles, ammunition, small arms, tactical radios, and other equipment.

“To help prepare for future military requirements, the bill authorizes major weapons programs and platforms that will protect our national security in the years ahead. Demonstrating our commitment to reverse the decline in the size of the Navy fleet, the bill authorizes 9 new ships, including 2 Virginia-class submarines, 2 DDG 51 destroyers, and 2 Littoral Combat Ships. The bill also authorizes F-35 competitive engine program, a necessary insurance policy on the trillion dollar Joint Strike Fighter program that will generate long term savings for taxpayers and also reduce the national security risk of depending on a single engine for ultimately 95 percent of our nation’s fighter fleet.

“In keeping with the committee’s interest and longstanding defense policy oversight, the bill seeks to improve the Quadrennial Defense Review (QDR) process. The bill replaces the QDR Independent Review Panel appointed by the Secretary of Defense with a National Defense Panel consisting of ten members, with the Secretary of Defense appointing two panel co-chairs, and the Chairmen and Ranking Members of the House and Senate Armed Services Committees each appointing two members.

“Each year, members of the House Armed Services Committee work very hard to make this the best bill possible for our military and for our nation. I want to thank all of our members for helping our committee fulfill our Constitutional obligation to raise and support the U.S. Armed Forces.”

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House Armed Services Committee: Skelton Welcomes New Democratic Members to House Armed Services Committee

May 7, 2010 by · Comment
Filed under: Syndicated Industry News 
House Armed Services Committee: Skelton Welcomes New Democratic Members to House Armed Services Committee
Ike Skelton, Chairman
May 7, 2010

Skelton Welcomes New Democratic Members to House Armed Services Committee

Washington, DC – House Armed Services Committee Chairman Ike Skelton (D-MO) released the following statement on the appointment of two new Democratic Members to the House Armed Services Committee:

“I extend a warm welcome to Congressman John Garamendi of California and Congressman Leonard Boswell of Iowa who will be joining the House Armed Services Committee. I’m confident Congressman Garamendi and Congressman Boswell will discover they have joined one of the best committees in Congress, particularly now as we work toward the markup of the annual defense authorization bill. Each of our Committee Members will have the opportunity to play an important role as we work together to support our men and women in uniform and protect U.S. national security.

“I also want to thank Congressman Patrick Murphy of Pennsylvania for his service as he leaves the House Armed Services Committee to join the House Appropriations Committee. He will be missed by our Committee, but I know Congressman Murphy will continue to be a strong advocate for our national defense and for our service members and their families.”


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House Armed Services Committee: Skelton on Military Power of Iran Report

April 19, 2010 by · Comment
Filed under: Syndicated Industry News 
House Armed Services Committee: Skelton on Military Power of Iran Report
Ike Skelton, Chairman
April 19, 2010

WASHINGTON, D.C.—Today, House Armed Services Committee Chairman Ike Skelton (D-Mo.) released the following statement after receiving a report on the Military Power of Iran that was mandated in last year’s national defense authorization bill:

“Today, we received a report providing a comprehensive view of the military situation in Iran, including conventional and unconventional weapons capabilities. It is clear from this report that the Department of Defense has a thorough understanding of the potential threats posed by Iran’s military capabilities, setting a strong foundation upon which to build the necessary strategies to address these issues and keep America and our allies safe. I appreciate the Administration’s demonstrated and ongoing effort to end the Iranian nuclear weapons program, and I look forward to working with my colleagues in Congress and with President Obama to protect our nation from the threats posed by Iran to our national security.”

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House Armed Services Committee: Skelton to Introduce Legislation to Protect TRICARE

March 18, 2010 by · Comment
Filed under: Syndicated Industry News 
House Armed Services Committee: Skelton to Introduce Legislation to Protect TRICARE
Ike Skelton, Chairman
March 18, 2010

Skelton to Introduce Legislation to Protect TRICARE

Washington, D.C.—Today, House Armed Services Committee Chairman Ike Skelton (D-Mo.) released the statement below regarding his intent to introduce legislation to explicitly state in law that TRICARE and the DOD nonappropriated fund (NAF) health plans meet all of the health care requirements currently under consideration by Congress for individual health insurance. These programs provide health coverage to members of the military and their families, military retirees and their families, and employees of U.S. military post/base exchanges and other nonappropriated fund activities.

“Our nation’s military provides us with first-class protection, and it is our obligation to provide them—and their families—with first-class health care in return. While some of this Committee’s members may disagree on overall health care reform, we are united in our commitment to ensuring that any measure signed into law will not have any unintended consequences that adversely impact the military health care programs for our men and women in uniform and their families.

“Although the health care legislation passed by the House explicitly exempted TRICARE from being affected, the Senate bill did not. Unfortunately, the parliamentary rules of the reconciliation process did not allow for the inclusion of language that specifically protects these programs. To reassure our nation’s service members and their families that their health coverage will remain unaffected by this, I will introduce legislation this week to explicitly state that TRICARE and the NAF health plans meet all requirements for individual health insurance; this language will also be included in this year’s national defense authorization bill.”

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House Armed Services Committee: Skelton Statement on Earmark Changes

March 10, 2010 by · Comment
Filed under: Syndicated Industry News 
House Armed Services Committee: Skelton Statement on Earmark Changes
Ike Skelton, Chairman
March 10, 2010

Skelton Statement on Earmark Changes

Washington, D.C.— Today, House Armed Services Committee Chairman Ike Skelton (D-Mo.) released the statement below following the announcement by the House Appropriations Committee that it will not approve requests for earmarks that are directed to for-profit entities:

"The House Armed Services Committee is committed to transparency and competition. As we enter the early stages of crafting the FY11 defense authorization bill, we will adjust our processes to reflect the earmark changes adopted by this Congress."

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House Authorizers set own priorites

The House Armed Services Committee marked up the FY09 Defense Authorization Bill to their own priorities. See an article here. Big cuts were made to the Army’s Advanced Reconnaissance Helicopter (ARH) and Future Combat System (FCS). ARH, a new Bell helicopter to replace the OH-58D Kiowa Warrior, has had its struggles. FCS is a vast system of systems that will still get over $2 B of funding with the House cut. Of course the Senate has fully funded both programs so that will have to be worked out in Conference. Some programs did gain such as the C-17 and the House continued the second engine for the F-35 JSF despite Pentagon protests that it is not necessary. There will be many more changes by October.

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U.S. House Armed Services Committee Moves to Preserve Competition for JSF Propulsion

EVENDALE, Ohio--(BUSINESS WIRE)--The U.S. House Armed Services Committee today led the charge for defense acquisition reform by voting on a National Defense Authorization Bill that includes $485 million in continued funding for F136.

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