Pentagon transfers $25M from Army's ITEP, program remains ahead of schedule

The Pentagon in April approved a $25 million transfer from the Army’s Improved Turbine Engine Program to Army Space Systems Integration, according to a reprogramming memo.

In the April 17 memo, which was recently made public, then-acting Pentagon Comptroller Elaine McCusker transferred fiscal year 2019 research, development, test and evaluation funds from ITEP due to "rephasing costs from the design engineering for the platform/engine integration contract award to a later fiscal year effort."

"These costs budgeted for phase 1 are not needed in FY 2019 and will not be required until a later fiscal year for the Phase 2 integration," the memo states.

The Army awarded an Engineering and Manufacturing Development contract to General Electric last February for the company's T901 turbine engine, which is the designated engine for the Army’s Future Attack Reconnaissance Aircraft.

"Both the budget submittal (November 2018) and the Army Cost Position (January 2019) were finalized and approved before the EMD contract was awarded in February 2019," the Army's Aviation Turbine Engines Project Office told Inside Defense in an email today. "While the ACP is an accurate depiction of the total program cost, it does not represent the funding profile for GE’s execution plan on the awarded EMD contract."

The ACP also did not account for the "phased approach of the Black Hawk and Apache integration contracts" and the service is working to rephase the funding into future years to "ensure alignment for optimal execution of the program," according to the office.

ITEP still remains ahead of the acquisition program baseline schedule and is accelerating to align with the FARA competition, the office added.

The transfer brings the Army Space Systems Integration, a new start requirement, to $95.8 million in RDT&E funds. The memo states the new start is a base budget requirement.

"Funds are required to purchase and integrate hardware for a collaborative interagency project enabling a FY 2021 demonstration of theater tasking and data delivery to Army tactical formations," the memo states. "Additionally, this funding supports terrestrial infrastructure risk reduction activities to enable concept of operations and tactics, techniques and procedures development through FY 2020."

An Army spokesperson in a statement to Inside Defense July 22 said the space systems project will allow the service to integrate its command and control systems into an ongoing interagency project that will demonstrate capabilities in FY 2021.