The Insider

By Courtney Albon
November 8, 2018 at 5:59 PM

The Air Force awarded Ball Aerospace & Technologies Corp. a $255 million contract modification today for the Weather System Follow-On Microwave program.

The Nov. 11 award will cover development and fabrication of the first WSF-M space vehicle, and work is expected to be complete in January 2023. It builds on an initial $92 million contract last November, which covered design and risk-reduction for the effort.  

WSF-M is part of the broader WSF program, which is aimed at addressing the Air Force's slate of weather characterization, sensing and monitoring requirements. The service also plans to develop WSF Electro-Optical/Infrared satellites, WSF-E, the first of which should launch in fiscal year 2024.

By Justin Doubleday
November 8, 2018 at 4:41 PM

The Defense Department is putting some guardrails around its new acquisition authorities, with a handbook on other transaction authority set for release later this month, and a policy governing rapid prototyping and acquisition on the way in early 2019, according to the Pentagon's acquisition chief.

DOD hasn't taken full advantage of acquisition authorities like other transaction agreements (OTAs) and rapid prototyping because the law hasn't been translated into guidance, Under Secretary of Defense for Acquisition and Sustainment Ellen Lord said today at the Naval Submarine League's annual symposium in Arlington, VA.

"We're writing handbooks," Lord said. "For instance, other transaction authorities have a very bad name in a lot of bad places because they've been misused a few times. However, they are very, very important contracts to use, because you don't always know exactly what your requirement is. OTAs are used when you're really experimenting and prototyping a little bit to find out exactly what the art of the possible is."

She said the OTA handbook would be ready by Thanksgiving, with courses to follow at the Defense Acquisition University.

Meanwhile, earlier this year, Lord provided the military services and agencies with interim authority to use a streamlined rapid prototyping path for so-called "middle tier of acquisition" programs that can be prototyped and fielded within five years.

Lord described how the authority allows DOD to sidestep the traditional acquisition requirements process, and she said the authority is being used "in the appropriate places."

"For instance, when there's commercial technology that just takes a little tweak to militarize it and get it into the warfighter's hands," she continued. "When you have an already fielded system that really, for an incremental investment, you can get step-function change in capability where you don't need to go through the [Joint Capabilities Integration and Development System] process and go through two years of requirements development."

Lord has already tightened oversight of how the military services are using the authority. Her office is collecting data on current-use cases, with "detailed guidance" expected early next year, she said.

The broadened use of OTAs and the rapid prototyping pipeline were both established in the Fiscal Year 2016 National Defense Authorization Act. But lawmakers moved to restrict DOD's flexibility with OTAs after a cloud services agreement went awry earlier this year.

Congress ultimately left DOD's ability to use OTAs untouched this year, but the FY-19 appropriations measure increases reporting requirements on their use.

Lord said failures will occur in some cases with the new authority, but her aim is to "fail quickly" and continuously prototype and experiment with new ways of doing business. Since finalizing plans for re-organizing the Pentagon's acquisition offices earlier this year, DOD officials have focused more on implementing purchasing reforms like OTAs and rapid prototyping.

"We want people to get out and use these authorities, not to be scared of them, and be very creatively compliant," Lord said.

By Tony Bertuca
November 8, 2018 at 3:23 PM

A large lobbying arm of the defense industry is posturing itself to oppose planned cuts to defense spending directed by the Trump administration and favored by some newly empowered Democrats.

The Aerospace Industries Association released a statement today calling on lawmakers to not "backtrack on military investment." 

"We urge the president and the Congress to provide steady and stable growth in defense spending in the fiscal year 2020 budget request and beyond," AIA said. "The Pentagon's 2018 National Defense Strategy requires armed forces that are large and capable enough to meet multiple threats in multiple environments. To achieve this, we must continue to invest in the most effective technology and weapons we can provide."

AIA's call to protect military spending comes as the Trump administration has ordered the Pentagon to begin planning for a total defense topline of $700 billion in fiscal year 2020, about $33 billion less than the department had planned for and $16 billion less than FY-19. The cuts are intended to help the federal government contain record deficits.

Additionally, Democrats on Tuesday seized a majority in the House for the first time since 2010. Some senior party leaders, including Rep. Adam Smith (D-WA), who is slated to replace House Armed Services Committee Chairman Mac Thornberry (R-TX), has said he thinks defense spending is too high.  

Noting the "huge strides" in military technology made by American adversaries like China and Russia, AIA said that now is the wrong time to cut defense spending.

"In 2018 and 2019, the administration and Congress have begun to provide the Department of Defense with more resources to modernize and meet these growing threats," AIA said. "As a result, military readiness is improving, and our industry is responding with more innovation and advanced capabilities. But the shortfalls of the last decade cannot be erased in the space of two years, and now the Administration has announced potential reductions in defense investment that could undermine the improvements that are just now materializing."

It remains to be seen which weapons programs would be most impacted by the administration's proposed budget cut, but Deputy Defense Secretary Pat Shanahan said last month DOD could slow the progress of certain modernization programs, like hypersonics.

"In these projects we can either do them or defer them," he said at the time. "There is prioritization we can make."

By Justin Katz
November 8, 2018 at 2:30 PM

The Navy is planning two different paths forward following the completion of the 12th Columbia-class submarine, both of which involve keeping the line open, according to a service official.

Rear Adm. John Tammen, undersea warfare requirements director, said the service will base its decision on the needs of U.S. Strategic Command.

The first choice would be to produce more Columbia-class submarines, beyond the 12-submarine minimum laid out in the latest nuclear posture review.

If STRATCOM does not request more submarines, then Tammen said the service is developing a "large-volume host platform" which will have "the ability to host vehicles onboard inside that center section" of the submarine. He did not provide further details because the service is still developing the concept.

"Depending on what happens in the strategic environment, we have two paths forward on the Columbia line," he told attendees today at the Naval Submarine League Symposium.

Separately, the admiral said the Navy stood up a sustainment working group for Columbia's predecessor, the Ohio-class submarine, citing the fact the Navy has never had a submarine with a 42-year service life.

The group is "looking at those first Ohio-class [guided missile submarines] and getting everything we can from the maintenance and teardowns we're doing on those, and rolling it forward into the Ohio-class SSBNs to make sure they make the 42-year commitment we've made to STRATCOM."

That group was established earlier in the year, a Navy spokeswoman told Inside the Navy in a Nov. 8 statement.

By John Liang
November 8, 2018 at 2:11 PM

This Thursday INSIDER Daily Digest has news on an Air Force cybersecurity review, coverage of the Naval Submarine League Symposium and more.

An Air Force cybersecurity review has been delayed:

Budget constraints delay Air Force's cybersecurity review of legacy systems

Funding delays dating back to the start of fiscal year 2018 have slowed the time line for a key Air Force assessment of cyber vulnerabilities in its major weapon systems from 2018 to 2020, a service spokeswoman confirmed to Inside Defense this week.

The Naval Submarine League Symposium is taking place this week. Here's our coverage so far:

Wolfe: Trade studies for second Trident D5 life extension program starting in FY-20

The Navy will begin trade studies in fiscal year 2020 to evaluate the possibilities for a second life extension program of the Trident II D5 fleet ballistic missile, according to the service's director of strategic systems programs.

DOD directs Navy to stand up new hypersonic program office for CPS transition in FY-20

The Defense Department has directed the Navy to stand up a formal program office for the U.S. military's marquee hypersonic boost-glide project, a major milestone that caps a decade-long, $1 billion technology development effort and sets the stage for the Navy to weaponize the Conventional Prompt Strike for the submarine fleet.

Navy conducting new inspections of Columbia vendors following missile tube welding faults

The Navy in September began conducting new inspections of its supplier base supporting the Columbia-class submarine program in response to faulty welding on missile tubes found in August, according to a Navy officer overseeing the submarine program.

The GPS ground segment modernization effort will have a $6.09 billion development cost and a $2.3 billion operations and support cost:

Pentagon certifies new cost positions for GPS ground and space segment modernization efforts

The Pentagon recertified the funding baseline for its GPS ground segment modernization effort this summer, estimating the program will cost $8.4 billion.

The Air Force will be done swapping out the legacy Huey helicopters that patrol ICBM bases by fiscal year 2027:

Air Force projects swapping ICBM base Hueys for MH-139s will take eight years

Intercontinental ballistic missile bases in Montana, North Dakota and Wyoming will receive new MH-139 helicopters from fiscal year 2021 through FY-27, as the Air Force looks for ways to mature the fleet faster.

By Rachel Cohen
November 8, 2018 at 1:05 PM

The Air Force Research Laboratory is prototyping four business applications it hopes will create a cheaper, simpler way to oversee research and development programs.

The Air Force aims to streamline how it plans programs and manages money with a shared platform that also respects each AFRL site's unique processes, according to Chadwick Pfoutz, deputy division chief for enterprise business systems at AFRL. He spoke about how the service is modernizing its information technology at a Nov. 8 conference hosted by Pegasystems, which offers the cloud-based Pega business management software.

"We have a full-blown tasker app, we a have work unit initiation [app] -- think of working on a project, we have a program management app and we have a planning, something to help with our [program objective memorandum] process," he said of Pega. "I have five of the nine directorates of AFRL working on those prototypes right now."

Pfoutz told Inside Defense all four will be in production by May. The Air Force should start seeing cost and schedule savings -- as well as more automation and fewer data silos -- by next summer.

By Marjorie Censer
November 8, 2018 at 10:10 AM

Huntington Ingalls Industries said today sales in its most recent quarter reached $2.1 billion, up 12 percent from the same three-month period a year earlier.

The contractor's quarterly profit hit $229 million, up 54 percent from the prior year.

Huntington Ingalls saw the largest sales increase in its Ingalls Shipbuilding business, which recorded $694 million in quarterly revenue.

The contractor attributed the 17 percent increase to "higher revenues in amphibious assault ships and the Legend-class National Security Cutter (NSC) program, partially offset by lower surface combatant revenues."

By Marjorie Censer
November 8, 2018 at 9:51 AM

Leonardo DRS said today it has named John Baylouny chief operating officer, succeeding Terry Murphy, who will retire at the end of the year.

Baylouny was previously the company's chief technology officer and has also served as general manager of its land systems and advanced ISR businesses.

"As COO, Baylouny will be responsible for program operations and execution across all of the eight Leonardo DRS businesses," Leonardo DRS said. "He will lead and manage the business unit leaders as well as the corporate operational functions, including Supply Chain, Technology, and Information Technology."

By John Liang
November 8, 2018 at 9:42 AM

Some must-reads from this week's issue of Inside the Pentagon:

1. Democrats reclaimed a majority in the House last night, ousting GOP committee chairmen from perches of influence and tightening the pressure on defense hawks who must now contend with a White House seeking new fiscal restraint and progressive-minded lawmakers ready to cut defense spending.

Full story: Dems reset Congress as GOP defense hawks face uphill push on spending

2. BALTIMORE, MD -- The Defense Department has launched initiatives for mitigating cybersecurity risks in two key areas -- supply-chain vulnerabilities and consolidating cloud services -- viewed as crucial to the military's mission, according to DOD Deputy Chief Information Officer for Cybersecurity Donald Heckman.

Full story: DOD's deputy CIO highlights initial steps in addressing emerging cyber risks

3. The Defense Information Systems Agency wants to automate more processes used to protect Defense Department networks from cyberattacks and use data analytics to study intrusions and develop algorithms to identify potential threats.

Full story: DISA seeking automated defenses, data analytics to boost DOD cybersecurity

4. The Pentagon in the coming year will be able to implement about one-third of the 300 classified policy recommendations in its recent report on the defense industrial base, according to Deputy Assistant Defense Secretary for Manufacturing and Industrial Base Policy Eric Chewning, who helped manage the study.

Full story: Pentagon moving on defense industrial base policy changes

By Tony Bertuca
November 7, 2018 at 4:32 PM

House Armed Services Committee Chairman Mac Thornberry (R-TX) and Ranking Member Adam Smith (D-WA) made appointments today to a new National Commission on Military Aviation Safety.

The commission, established by the Fiscal Year 2019 National Defense Authorization Act, is intended to investigate the causes of recent high-profile aviation mishaps.

Thornberry has appointed former Texas congressman Pete Geren, who previously served as a Pentagon official from 2001 to 2009, including as special assistant to the defense secretary, acting Air Force secretary, acting Army secretary and acting Army under secretary, according to a statement from the committee. Geren is currently the president of the Sid W. Richardson Foundation.

Smith, slated to succeed Thornberry as committee chairman when Democrats formally reclaim control of the House next year, has named retired Air Force Gen. Raymond Johns, who previously served as chief of Air Mobility Command. John is currently Co-CEO of FlightSafety International.

Under the NDAA, Thornberry and Smith are allowed to appoint one commissioner each, while President Trump may appoint four.

By Justin Katz
November 7, 2018 at 2:47 PM

The Navy will begin refueling the first Los Angeles-class submarine starting with the Cheyenne (SSN-773) in 2023, according to the director of the naval nuclear propulsion program.

Adm. James Caldwell, chief of naval reactors, told attendees today at the National Submarine League Symposium the Navy is working to modernize its facilities at the Portsmouth Naval Shipyard in Kittery, ME, to support the refueling effort.

The refueling is expected to extend the service life of the submarine by 10 years, Navy acquisition executive Hondo Geurts told Congress in March.

Geurts said at the time the Navy would evaluate its performance on the first submarine, and then consider refueling up to four more vessels. However, Caldwell said today the Navy will consider refueling between five and seven Los Angeles-class submarines.

Rear Adm. Michael Jabaley, then program executive officer for submarines, testified alongside Geurts in March that Los Angeles-class nuclear-powered submarines are not designed for "ease of refueling." But the Navy has become more confident in its ability to refuel the Los Angeles class based on its work with the Ohio-class submarines, he said.

"The biggest technical risks are taking a ship that was going to serve to 33 years and extending it for an additional 10 years," Jabaley told Congress.

By John Liang
November 7, 2018 at 2:41 PM

This Wednesday INSIDER Daily Digest looks into the implications of the Democrats' takeover of the House on defense.

A look at the implications for defense now that Democrats have won back the House:

Democrats reset Congress as GOP defense hawks face uphill push on spending

Democrats reclaimed a majority in the House last night, ousting GOP committee chairmen from perches of influence and tightening the pressure on defense hawks who must now contend with a White House seeking new fiscal restraint and progressive-minded lawmakers ready to cut defense spending.

. . . Plus a look at the implications for Air Force nuclear modernization programs:

Nuclear modernization programs could face renewed scrutiny in Democrat-controlled House

As the Air Force's multibillion-dollar nuclear modernization programs forge ahead, Democrats are expected to use their new majority in the House to renew the debate over which types of nuclear weapons the United States should own and how to fund their upgrades.

BWXT's chief executive spoke with analysts today about what his company was doing to remedy faulty missile tubes:

BWX Technologies takes $27 million charge for missile tube rework

Realizing the rework necessary for missile tubes slated for the Columbia-class submarine "were more substantial than previously contemplated," BWX Technologies has reserved $26.7 million to cover repairs, the company disclosed today.

The Cybersecurity Risk Management Conference hosted by the National Institute of Standards and Technology is taking place this week in Baltimore:

Pentagon's deputy CIO highlights initial steps in addressing emerging cybersecurity risks

BALTIMORE, MD -- The Defense Department has launched initiatives for mitigating cybersecurity risks in two key areas -- supply-chain vulnerabilities and consolidating cloud services -- viewed as crucial to the military's mission, according to DOD Deputy Chief Information Officer for Cybersecurity Donald Heckman.

More cyber news:

DISA seeking automated defenses, data analytics to boost DOD cybersecurity

The Defense Information Systems Agency wants to automate more processes used to protect Defense Department networks from cyberattacks and use data analytics to study intrusions and develop algorithms to identify potential threats.

Pentagon inspector general examines adequacy of info-sharing under cyber law

The Defense Department inspector general's office has examined the adequacy of sharing cyber-threat indicators under the Cybersecurity Act of 2015, among other measures required by the law, in a new report slated for release next month.

By Marjorie Censer
November 7, 2018 at 11:54 AM

Yesterday's election has led to an improved environment, Tom Kennedy, Raytheon's chief executive, said during a Baird conference today.

Kennedy told attendees he has found both parties supportive of defense spending; the chief difference, he said, has been their stances on domestic spending.

"The one concern that we did have was relative to the deficit hawks," Kennedy said. "Most of the deficit hawks were in the House [of Representatives] and on the Republican side, so with the House actually going Democratic, it actually changes the equation a little bit."

"In the endgame, from our perspective, we feel that the environment is actually nice now. It's settled," he added. "The uncertainty's taken out, and we don't have this issue with the deficit hawks moving forward."

By Marjorie Censer
November 7, 2018 at 11:12 AM

Vectrus said yesterday sales in its most recent quarter reached $308 million, up 14 percent from the same three-month period a year earlier.

The contractor's quarterly profit hit $9.9 million, up 70 percent from the prior year.

Vectrus said 4 percent of its sales boost was related to its base business; the remainder came from its acquisition of SENTEL.

In a call with analysts yesterday, Chuck Prow, Vectrus' chief executive, said the company has diversified its business. Three years ago, Army work made up 91 percent of the company's sales; today, that figure is 72 percent.

Almost half of the contractor's new work has come from the Air Force, according to a company chart.

By Justin Katz
November 7, 2018 at 9:38 AM

Huntington Ingalls Industries announced yesterday General Dynamics Electric Boat awarded the company's Newport News Shipbuilding business a $197 million contract modification for long-lead-time materials and advance construction activities for the first Columbia-class ballistic missile submarine.

The money will be used to procure major components and commodity material and to begin advance construction on the first Columbia-class submarine (SSBN-826), expected to begin full construction in fiscal year 2021 and be delivered in FY-28.

Columbia class is the Navy's stated No. 1 acquisition program.