The Insider

By Courtney Albon
October 30, 2020 at 2:45 PM

The Pentagon today announced it has created a new assistant defense secretary for space policy position, a role that Congress required the Defense Department to create in the Fiscal Year 2020 National Defense Authorization Act.

Justin Johnson, who has been serving as acting deputy assistant defense secretary for space policy, will perform the duties of assistant defense secretary for space policy until a nominee is confirmed. Gregory Pejic will act as Johnson's deputy until someone is appointed to the position.

"The establishment of the assistant secretary of defense for space policy is a change of the civilian oversight of the space enterprise that aligns with the establishment of the U.S. Space Force and U.S. Space Command," Deputy Defense Secretary David Norquist said in a press release.

By John Liang
October 30, 2020 at 1:52 PM

This Friday INSIDER Daily Digest has a scoop on a piece of the Pentagon's COVID-19 spending, plus defense contractors' quarterly earnings and a lot more.

Inside Defense obtained a letter sent by Pentagon acquisition chief Ellen Lord to the Congressional Oversight Commission established to review the $2.2 trillion in COVID-19 stimulus spending:

DOD responds to congressional watchdog on controversial YRC loan

The Defense Department has responded to the inquiries of a special congressional commission in the matter of a controversial pandemic stimulus loan made to a trucking company with connections to the White House, according to a letter obtained by Inside Defense.

Document: DOD's response to congressional watchdog on YRC loan

Our continuing coverage of defense contractors' quarterly earnings:

Contractors warn of uncertainty ahead, but report increased sales

Top contracting executives noted this week the current period -- with surging COVID-19 cases, a continuing resolution and an upcoming election -- is uncertain, but said so far they have been able to maintain sales and profit.

CACI, Oshkosh defense group, others report improved quarterly sales

Less than 1% of CACI International's 23,000 employees have contracted COVID-19, the company's chief executive said today.

The House Armed Services Committee's top Democrat is calling for a rewrite of the National Defense Strategy:

Smith calls for new National Defense Strategy if Biden wins

House Armed Services Committee Chairman Adam Smith (D-WA) said the current National Defense Strategy places too much emphasis on militarily dominating China and Russia and called on Democrats to rewrite it if former Vice President Joe Biden wins the presidential election.

Some Navy unmanned systems news:

Navy finishing unmanned surface vehicles concept of operations 'in next few months'

The Navy is set to complete and release a concept of operations for the medium and large unmanned surface vehicles in "the next few months," a Navy spokesman told Inside Defense.

With MQ-27 expected to sunset, L3Harris, Martin UAV will demo drone capabilities in Arizona

L3Harris Technologies and Martin UAV will conduct live demonstrations of their unmanned aerial systems later this year at Yuma Proving Ground, AZ, as part of the Pentagon's effort to replace a current drone used by naval special forces for intelligence, surveillance and reconnaissance.

Navy shipbuilding news:

Navy's SIOP plans will require two environmental impact statements

Before the Navy can proceed with its plan to revamp the four major public shipyards, the service will have to prepare two environmental impact statements, one for the Hawaii-based shipyard and one for its Washington-based facility.

Force structure review will continue past current analysis, Kilby says

The Navy needs to continue evaluating the future needs of its amphibious force past the current force structure analysis, according to a senior Navy official.

Gillian Bussey, director of the Joint Hypersonic Technology Office, said DOD recently awarded Boeing and Aerojet Rocketdyne a contract as part of the JHTO's effort to promote advanced-concept development projects, an effort now managed by the Air Force Research Laboratory:

Boeing, AFRL eye dual-mode scramjet design to arm F/A-18s with hypersonic cruise missiles

The Defense Department this week disclosed a significant new hypersonic project that is tailored to potentially outfit naval aviators with an ultrafast cruise missile -- particularly F/A-18 Super Hornet fighters operating from aircraft carriers -- that aims to advance a Boeing concept for a dual-mode scramjet design.

Last but never least, some defense cyber news from our colleagues at Inside Cybersecurity:

DOD rule establishes cyber compliance regime ahead of full CMMC implementation

The Pentagon will require government contractors to submit a self-assessment of their compliance with the 110 controls in National Institute of Standards and Technology Special Publication 800-171 starting Nov. 30, establishing a new cyber regime for contractors under the Defense Department that will have a wide-ranging impact on the DOD supply chain.

By Marjorie Censer
October 30, 2020 at 1:25 PM

The chief executive of L3Harris Technologies said today the company has cut the number of projects it's funding with independent research and development dollars to focus on promising technologies.

In a call with analysts today, Bill Brown said the company is dedicating about 3.6% to 3.8% of revenue to IRAD.

"We've reduced the number of projects by about 30%," he said, noting the company has sought to focus on the technologies it thinks will offer the best returns.

Additionally, Brown said L3Harris is seeking to make sure it's using the funding efficiently.

"We've got good opportunities to drive operational excellence skills into the way we develop products," he said.

Brown told analysts he doesn't see the total percentage dedicated to IRAD growing.

"I don't see it stepping up materially," he said. "It'll come up with revenue in terms of a dollar perspective, but I think we're spending a healthy amount on R&D."

Meanwhile, L3Harris Technologies said today sales in its most recent quarter totaled almost $4.5 billion, essentially flat from the same three-month period a year earlier.

The contractor's quarterly profit hit $430 million, down 1% from the prior year.

By John Liang
October 30, 2020 at 1:17 PM

The Defense Department and General Services Administration announced today they have decided to once again award the multibillion-dollar Defense Enterprise Office Solutions cloud services contract to a team lead by General Dynamics Information Technology.

The DEOS Blanket Purchasing Agreement includes tools like email, messaging, word processing, file sharing and storage across the DOD enterprise. The BPA was originally awarded to CSRA and its partners Dell Marketing and Minburn Technology Group in August 2019. CSRA was acquired by General Dynamics in 2018.

Following the award, Perspecta filed a protest with the Government Accountability Office.

In its announcement today, DOD and GSA said they "have made every effort to ensure this process is fair, transparent, and equitable."

"As part of a due process for interested parties, the original DEOS award in August 2019 was initially protested with various supplemental protests being filed with the Government Accountability Office," the agencies added. "GSA elected to take corrective action, amended the solicitation, received and evaluated new quotes, and made an award to the vendor that was determined to provide the best value to the government."

DOD said it estimates the value of the DEOS BPA at $4.4 billion over a 10-year period, which includes a five-year base period with two two-year options and one one-year option.

By Marjorie Censer
October 30, 2020 at 10:41 AM

Private-equity firm Arlington Capital Partners said this week it has formed BlueHalo, a new national security company created by combining AEgis Technologies, Applied Technology Associates and Brilligent Solutions.

Arlington Capital Partners noted that AEgis also previously acquired Excivity and EMRC Heli.

"BlueHalo is purpose-built to provide industry leading capabilities in the domains of Space Superiority and Directed Energy, Missile Defense and C4ISR, and Cyber and Intelligence," Arlington Capital Partners said.

Jonathan Moneymaker will serve as chief executive of BlueHalo.

By Courtney Albon
October 30, 2020 at 10:30 AM

The Air Force Research Laboratory is working with Air Mobility Command to craft a mobility research vision that outlines research needs and priorities to prepare for a 2030 operating environment.

Speaking this week at the virtual Airlift/Tanker Association conference, Deputy Director of AFRL's Aerospace Systems Directorate Col. Tim West and Rapid Global Mobility Deputy Capability Lead John Frazey said the vision will explore research needs within AMC's four main mission areas: airlift, aerial refueling, aeromedical evacuation and the global air mobility support system.

West said the team hopes to have a draft completed in the next month and is looking to solicit input from the field and from industry to help refine the capability gaps and needs in each mission area. He noted that the completed report, which will evolve as threats change, will help AFRL shape its research priorities and advocate for mobility science and technology funding.

"Once we get a document that AMC, [the Air Force Warfighting Integration Capability], the lab and others are in general agreement that it makes sense, we will use that as our way of prioritizing and advocating for S&T funding based on that refined vision," West said.

Frazey said he thinks it is important that the vision look out into the 2030, 2035 timeframe in order to give a better understanding of what investments the service should make in order to be prepared for that future fight.

"Our adversaries are not staying put," he said. "They're advancing their technology. We need to make sure that we as global mobility personnel really look at what we need and use this vision to help influence the senior leader decisions."

By Sara Sirota
October 29, 2020 at 1:56 PM

The Air Force Research Laboratory is sole sourcing an 18-month contract to Raytheon to experiment with the company's directed-energy weapon prototype called the Counter-Electronic High Power Microwave Extended Range Air Base Air Defense (CHIMERA).

The award marks another victory for Raytheon's directed-energy portfolio after winning contracts last year to supply the Air Force with its High-Energy Laser Weapon System and Phaser, a high-powered microwave, for overseas testing.

A notice the Air Force released today announcing the new contract action doesn't indicate the value of the award or when the service expects to begin and finalize negotiations with Raytheon. The government is using authorities for "other than full and open competition" to sole-source the deal.

Tests with CHIMERA will occur at White Sands Missile Range, NM, Kirtland Air Force Base, NM, and Raytheon facilities. It's not clear when experimentation will begin.

By John Liang
October 29, 2020 at 1:38 PM

This Thursday INSIDER Daily Digest has news on the Defense Department's latest electromagnetic spectrum strategy, the Air Force Research Laboratory's science and technology priorities and more.

The Pentagon has released a new "Electromagnetic Spectrum Superiority Strategy":

New DOD strategy seeks to navigate spectrum sharing with 'commercial partners'

The Defense Department today released a new strategy for "Electromagnetic Spectrum Superiority" that seeks to share access with "commercial partners," though the relationship between the Pentagon and telecommunications companies has been marked by tension in the past.

Document: DOD's electromagnetic spectrum superiority strategy

The Space and Missile Systems Center recently held an industry day at which officials discussed some of the Air Force Research Laboratory's science and technology priorities:

AFRL directorate highlights space S&T priority initiatives

The Air Force Research Laboratory's space vehicles directorate has compiled a list of 13 science and technology areas it plans to prioritize in the near term, the outcome of a two-year strategic planning process.

The Army in the last few weeks won support from Congress to promptly fund a requirement for the Mid-Range Capability missile with $77 million appropriated in fiscal year 2020:

Army immediately launching new Mid-Range Capability program; eyeing Tomahawk, SM-6

The Army is moving to adopt land-based variants of the Navy's strike inventory -- eyeing the Tomahawk cruise missile and Standard Missile-6 -- in order to field by 2023 a prototype Mid-Range Capability battery, filling an "extremely high risk" capability gap by adding a layer to its long-range precision fires portfolio for targets between the ranges of its planned Precision Strike Missile and Long Range Hypersonic Weapon.

Air Force Gen. Stephen Lyons gave a speech this week at an Airlift/Tanker Association conference:

TRANSCOM head: MCRS could drive increased airlift requirement

The head of U.S. Transportation Command said today an ongoing Mobility Capabilities and Requirements Study may reveal a need for more intratheater airlift aircraft.

Air Commodore Terry van Haren, an Australian air force attaché to the Australian Embassy in Washington, spoke this week at an event hosted in Mississippi:

Northrop Grumman says it has started building first Australian MQ-4 Triton

Ahead of a planned production gap with the U.S. Navy, Northrop Grumman this week announced it has begun building the first MQ-4 Triton marked for sale to the Royal Australian Air Force.

Last but certainly not least, some cyber defense news from our colleagues at Inside Cybersecurity:

Arrington: Pentagon to establish resolution process for CMMC assessment disputes

The Defense Department is working with the Cybersecurity Maturity Model Certification Accreditation Body to develop a process for companies to dispute their cyber assessment results and get an objective ruling from the Pentagon's lead contracts agency.

By Justin Katz
October 29, 2020 at 1:00 PM

A July report from the Navy to Congress outlining the causes for delays in ship and submarine maintenance failed to highlight issues "originating in the acquisition process or as a result of operational decisions," according to a new Government Accountability Office report.

Congressional appropriators in their fiscal year 2020 defense legislation directed the Navy to outline what factors have caused the service's chronic problems with completing ship and submarine availabilities maintenance.

The new GAO report says the service's analysis largely lines up with its own but criticizes the Navy for not providing a fuller picture.

"The report identified stakeholders needed to implement action plans, but did not fully incorporate other elements of results-oriented management, including achievable goals, metrics to measure progress, and resources and risks," the GAO report states.

Navy acquisition executive Hondo Geurts, responding for the Pentagon to GAO's report, contested the watchdog's claim, saying it falsely implied the service had not considered certain issues.

The "Navy's March 2019 report discusses some of these acquisition/operation ideas. The July 2020 report states it does not repeat acquisition/operations, as they were covered in the March 2019 report," he wrote. "[I]t is not accurate to imply the Navy has never considered them."

By Sara Sirota
October 29, 2020 at 12:30 PM

The military today launched an unarmed Minuteman III intercontinental ballistic missile from Vandenberg Air Force Base, CA, to verify the nuclear weapon's readiness and accuracy.

The routine launch featured an ICBM with a single reentry vehicle that contained test instruments and traveled about 4,200 miles to the Kwajalein Atoll in the Marshall Islands, according to an Air Force press release.

"These operational test launches serve multiple purposes," Col. Erik Quigley, Minuteman III systems director, said in the notice.

"First, they are a demonstration of our nuclear launch capability to all potential adversaries," he explained. "Second, they provide assurance of continued launch capability to any allies that rely on our nuclear forces to support their security. And third, they help validate our models of the Minuteman III fleet to ensure the ICBMs continue to meet stringent nuclear launch requirements."

The Minuteman III system is decades-old and the Air Force is currently developing a replacement with prime contractor Northrop Grumman as the legacy weapon nears the end of its service life.

The future Ground Based Strategic Deterrent is on track to begin fielding in the late 2020s. It has a roughly 50-year, life-cycle cost estimate of $264 billion, according to the Pentagon’s latest assessment.

The expensive project has bipartisan support in Congress, though some Democrats, particularly on the House Armed Services Committee, have sought to postpone or even remove funding from the Air Force's GBSD budget. Arms control advocates consistently describe ICBMs as the least valuable leg of the military's nuclear triad.

In today's press release, Air Force Chief of Staff Gen. Charles Brown called for steady support of the ICBM mission, stating, "We must continue to invest in this viable deterrent, and the Airmen who support this mission, as part of the most responsive leg of our nuclear triad."

By Marjorie Censer
October 29, 2020 at 9:11 AM

Parsons said today it has agreed to acquire Braxton Science & Technology Group and its subsidiaries in a move meant to expand Parsons' space, cyber and intelligence work.

"BSTG's broad portfolio of commercial off-the-shelf products -- as well as their sustainment of government off-the-shelf products -- provide mission-critical solutions including spacecraft ground control and spacecraft integration," Parsons said. "BSTG has over 50 differentiated space-mission product offerings consisting of software and hardware products combined with advanced engineering services."

Parsons said the Colorado Springs, CO-based Braxton will be integrated into its space and geospatial solutions business, adding more than 370 employees.

The deal is valued at about $258 million, Parsons said, and Braxton is expected to produce sales of about $133 million in 2021.

By Justin Katz
October 28, 2020 at 4:10 PM

The Navy yesterday awarded a $15 million contract to Energetics Technology Center of Indian Head, MD, for research efforts that will ultimately contribute to a congressionally mandated report on the Pentagon's efforts on energetics.

"The proposed effort has three major components: a national energetics study, automated global energetics [science and technology] awareness, and creating an energetics ecosystem. The national energetics study will collect and analyze information in support of the requirement to develop a plan that fulfills the request of [the] National Defense Authorization Act for fiscal [year] 2020, Section 253," according to a Defense Department statement.

The contract was competitively awarded through a Navy and Marine Corps "long range broad agency announcement," the statement reads.

The FY-20 NDAA directed the Pentagon to provide lawmakers with a long-term research and development plan that "maintains United States technological superiority in energetics technology critical to national security; efficiently develops new energetics technologies and transitions them into operational use, as appropriate," according to the legislation.

By Tony Bertuca
October 28, 2020 at 3:40 PM

Turkey has already been booted from the U.S. F-35 Joint Strike Fighter program for purchasing the Russian-made S-400 air defense system, but a State Department official today said Ankara could face additional consequences if it actually "operationalizes" the system.

R. Clarke Cooper, assistant secretary of state for political-military affairs, told reporters today the United States remains clear and consistent in its opposition to Turkey's use of the S-400 and the "potential for sanctions."

"Operationalizing such an asset or system incurs further risk of sanctions and further risk of restrictions," he said.

Turkey, meanwhile, confirmed last week that it had tested the S-400, a move which the Pentagon condemned "in the strongest possible terms."

Cooper said some Turkish officials may have had the sense they were "out of the woods" when the United States removed Turkey from the F-35 program.

"That is not the case," he said.

For instance, Cooper said, Turkey could be prohibited for purchasing additional weapon systems from the United States and allies.

Still, Cooper said, the United States does not want to push Turkey further from the West.

"Having Turkey pushed out completely is to no one's advantage except for Russia," he said.

"What we have here is [an] effort to get Turkey to walk back from operationalizing the S-400 . . . put it away, decommission it, just do not integrate and make it operable," Cooper added.

By Ashley Tressel
October 28, 2020 at 2:16 PM

Testing for the Army's Joint Assault Bridge program was moved from September to November of this year due to the COVID-19 pandemic, the service said this week.

In a statement provided to Inside Defense, Elizabeth Miller, product manager for bridging within the Program Executive Office for Combat Support and Combat Service Support said, "Test events are progressing well" and all test activities will end Nov. 25.

A previous slip affecting the program's full-rate production decision was cited in a congressional response to an August reprogramming request the Defense Department posted this month, in which Congress approved the shift of $33.1 million from the program.

Funds are "available due to the [fiscal year] 2019 reliability failure during Initial Operational Test and Evaluation (IOT&E)," the document states. "The root causes of the IOT&E reliability failure were hydraulic systems failures and fuel system leaks, which caused the Army to delay the Joint Assault Bridge's (JAB) Full Rate Production (FRP) decision for one year. This is the JAB program's first delay requiring funding re-phasing. They will be re-phased in the out-years once the issue has been resolved. The Army will retest the JAB platform in September 2020 with FRP expected in April 2021. This is base budget funding."

The product manager's statement did not address whether the 2020 delay would further push the FRP date, but Miller said the service would have more information "closer to the completion of the test activities."

By John Liang
October 28, 2020 at 1:33 PM

This Wednesday INSIDER Daily Digest has news on several big defense contractors' quarterly earnings, plus the Army's information technology priorities, Navy unmanned systems and more.

General Dynamics, Boeing and Raytheon reported their quarterly earnings this week:

GD reports about 1,800 COVID-19 cases among employees

About 1,800 of General Dynamics' roughly 100,000 employees have come down with COVID-19 and about 1,500 are "fully recovered and back to work," according to the company's chief executive.

Raytheon to divest Forcepoint business

Investment firm Francisco Partners said this week it has agreed to acquire Raytheon Technologies' Forcepoint cybersecurity business.

Army Lt. Gen. John Morrison, who previously was the chief of staff of U.S. Cyber Command, is now serving as the principal military adviser to the Army secretary and service chief of staff and is responsible for implementing the Army's chief information officer's policies:

New Army IT chief lays out priorities after office split

The Army's new information technology chief has laid out a set of priorities a few months into his role following a split of the Chief Information Officer/(G-6) office earlier this year.

Dorothy Engelhardt, director for unmanned systems in the office of the deputy assistant Navy secretary for ships, spoke this week during a webinar hosted by Booz Allen Hamilton:

Navy 'war room' looking at unmanned system capability gaps

As a result of the chief of naval operations tasking the service to develop an unmanned campaign plan, the Navy has created a "war room" to map out the capability gaps in its unmanned systems, according to a senior official.

Both House Armed Services seapower and projection forces subcommittee Chairman Joe Courtney (D-CT) and Ranking Member Rob Wittman (R-VA) support a larger Navy. But in separate interviews with Inside Defense, Wittman expressed optimism with Esper's statements, while Courtney said he was frustrated:

House seapower subcommittee leaders split on Esper's Navy plan comments

The leaders of the House Armed Services seapower and projection forces subcommittee are split on Defense Secretary Mark Esper's statements about his new plan to build up the Navy.