Building Bridges

By Thomas Duffy / December 24, 2008 at 5:00 AM

The latest Inside Missile Defense -- which won't be out until next week -- has a story about the ongoing negotiations between the Missile Defense Agency and Boeing, the lead contractor on the agency's huge program to defend the United States against a ballistic missile attack. Boeing had been working under a contract to develop the Ground-based Midcourse Defense system that was awarded in 2001.

Earlier this year, MDA announced that that contract became too complicated to execute and that Boeing would be signed to a new one by Dec. 31. But both sides are still talking over the details of that arrangement and won't make the Dec. 31 date.

To keep the effort going, MDA told us it will give Boeing a “bridge” contract until the main contract is in place.

And today, the agency told us the cost of the bridge contract will be $398 million in fiscal year 2009 money. It will be doled out to Boeing in two increments, each covering three months.

Here's a sneak peek at the story:

The existing contract Boeing has been working under since 2001 has become “too complex to administer effectively” and associated cost overruns have changed the program’s technical content and schedule, MDA said in a statement issued in early June. The agency decided to end that contract on Dec. 31 and have Boeing signed to a new deal called the “core completion contract.”

On Dec. 22, an MDA spokesman explained to Inside Missile Defense how the interim contract would be used: “It is a six-month bridge with ((an option of)) three months and an option for another three months,” he said. The dollar amount of the bridge contract is being negotiated, the spokesman added. Fiscal year 2009 dollars from the GMD account will pay for the bridge contract.

During a Nov. 12 teleconference with reporters, former MDA Director Lt. Gen. Trey Obering said the two sides had just started talking and that the agency would not be held to the Dec. 31 date. “We are beginning discussions on the negotiations with the contractor right now and I will not be held hostage to a schedule to try to minimize our leverage with respect to negotiations. While that is our target, that's not necessarily going to be a hard and fast date we are trying to meet.”

Obering said the cost of the core completion contract is “a big part of the negotiations.”

The GMD contract Boeing is now signed to calls for work to continue through 2011. The contract to be negotiated will extend that work another two years, through 2013.

During an Oct. 2 breakfast with reporters, Richard Danzig, who was advising the Obama campaign on national security issues, said the GMD effort would be one Pentagon program the new administration would closely review if Obama were elected.