The Insider

The Federal Aviation Administration has finalized operational rules for use of small drones in U.S. skies -- a move that has been enthusiastically supported by the Aerospace Industries Association.

On Tuesday, FAA finalized the first operational rules "for routine commercial use of small unmanned aircraft systems . . . opening pathways towards fully integrating UAS into the nation's airspace," according to an FAA release. The rules, applying to systems weighing less than 55 pounds "that are conducting non-hobbyist operations," will take effect in August, according to the release.
In an aim to reduce risks to aircraft in the sky and people on the ground, the rule requires pilots to keep their systems within a visual line of site. It also prohibits flights over unprotected people on the ground not involved in the UAS operations, according to the FAA release.

FAA notes that industry estimates that this rule could "generate more than $82 billion for the U.S. economy and create more than 100,000 new jobs over the next 10 years," according to the release.

In its own press release issued Tuesday, AIA notes that it "enthusiastically supports the FAA's small UAS rule," noting that it represents "the next important step towards routine UAS operations that balance the need for integration of this new technology into the national airspace system, along with the requirement to develop a culture of safety among UAS operators, and the technologies to protect manned aircraft operating at low altitude near airports."

AIA President and CEO David Melcher said that these regulations are a "positive step that provides industry with clarity on our path forward and allows FAA to focus its resources on developing requirements for beyond-line-of-sight operations -- the next critical milestone for small UAS," according to the statement.

"AIA was pleased to be a part of the process to develop and comment on the new Small UAS Rule," Melcher said in the statement. "It's a significant development that also bodes well for the next step in bringing medium- and high-altitude UAS into regular airspace operations."

The Defense Department's "fourth estate" will rely on the Government Services Administration's OASIS vehicle to award $500 million in professional services contracts starting in January 2017, according to a new memorandum of understanding.

DOD's "fourth estate," which includes all entities not in the military departments or the combatant commands, spends about $6 billion annually on professional services.

The core services acquired through OASIS, or One Acquisition Solution for Integrated Services, include program management, management consulting, logistics, engineering, scientific and financial services.

"OASIS has been employed successfully across the Department of Defense, particularly the military services, for some time," Claire Grady, director of defense procurement and acquisition policy, said in a joint DOD-GSA statement.

"This MOU not only paves the way for expanded usage by the 4th Estate, but also supports our commitment to cost-effectively meeting the warfighter's needs by securing the lowest fees for usage," she continued.

As DOD spends more through OASIS, the fee paid to GSA will decrease. At the high end, the fee is .75 percent, but it can be reduced to .1 percent, according to the MOU.

The National Defense Industrial Association has appointed Frank Michael senior vice president for program development.

In that role, he will manage the association's relationships with industry and government officials as well as work with NDIA's members, chapters, divisions and affiliates on programming and activities, NDIA said today.

Michael previously was chief of the Navy Strategy Branch in the Office of the Chief of Naval Operations. He also was a CNO fellow at the Chief of Naval Operations Strategic Studies Group.

The Pentagon recently announced it anticipates awarding a contract to Lockheed Martin in the first quarter of calendar year 2017 for Joint Strike Fighter Lots 12-14.

The proposed contract actions will provide for 100 F-35A conventional-takeoff-and-landing jets, 26 F-35B short-takeoff-and-vertical-landing aircraft and six F-35C carrier variant jets in Lot 12.

Lot 13 includes 104 F-35As, 26 F-35Bs and 12 F-35Cs. Lot 14 provides for 88 F-35As, 30 F-35Bs and 18 F-35Cs, according to a June 16 presolicitation notice posted on the Federal Business Opportunities website.

"Contract actions will provide for long lead time materials, parts, components, and effort; Ancillary Mission Equipment (AME); Production Non-Recurring (PNR) activities to support the F-35 production ramp rate including tooling, test equipment, production aids, production equipment, and support labor; technical, financial and administrative data; and proposal preparation," the notice reads, adding: "Contract actions will also provide for associated sustainment support including spares, support equipment, non-recurring autonomic logistics sustainment activities, training, Autonomic Logistics Information Systems (ALIS) hardware, depot activation, Performance Based Logistics (PBL) operations, and maintenance for all F-35A, F-35B, and F-35C aircraft; and all efforts associated with the procurement of hardware for and sustainment of Joint Reprogramming Enterprise (JRE)."

The Professional Services Council's latest acquisition policy survey found optimism from respondents about the acquisition workforce as well as concern about the barriers to innovation.

During a conference call with reporters Monday morning, David Bertea, PSC's chief executive, said this year's survey, conducted with Grant Thornton, had more respondents than any prior version.

Phil Kangas of Grant Thornton told reporters the biennial survey registered hope among the 80 federal officials, including senior acquisition executives, contracting professionals and congressional staff, surveyed about the acquisition workforce.

"There's definitely optimism that the workforce is getting better," he said.

However, more than one-third of respondents said it's "extremely difficult" to hire employees with the needed skills, while close to 40 percent said it's "difficult."

This combined figure is "a stark reminder that this is a set of skills that is very difficult to find in the talent marketplace," Kangas said.

Alan Chvotkin, PSC's executive vice president and counsel, told reporters the survey found workforce skills and fear of protests were listed by many as significant barriers to accessing innovation.

Asked about recommendations PSC might make, Berteau told reporters the organization would like to see the federal hiring process work better.

The government "being able to hire and retain and promote . . . the contracting workforce and the acquisition workforce would be very high on our list," he said.

Additionally, Berteau said PSC would like to see the government take a more innovative approach itself as it seeks innovation.

"A lot of this innovation comes from the existing contractor base as well as from the outside," he said, noting that improved buying rules and processes would benefit both groups.

Some must-reads from this week's edition of Inside the Army:

1. The Army "continue[s] to improve across all business areas," from leader engagement to accountability and implementation of new processes as it heads toward a full audit late next year, according to its assistant secretary for financial management and comptroller.

Full story: Army comptroller: Auditability 'not yet in our DNA'

2. The Army is ready to proceed to the next development phase for its Mid-Tier Networking Vehicular Radio, with a milestone C decision expected this summer, according to a spokesman.

Full story: Low-rate production decision for mid-tier Army radio expected in summer

3. The Army's Research, Development and Engineering Command is set for a leadership change, according to a June 8 Defense Department announcement.

Full story: RDECOM to see change of command

4. House and Senate lawmakers are in the early stages of considering how to best reconcile dueling defense policy bills with significant differences, including an $18 billion delta in how much the Pentagon would be authorized to spend in fiscal year 2017, and a host of acquisition reform measures that could significantly impact the defense industry.

Full story: House and Senate defense policy bills head to conference with major differences

The week ahead features many high-profile think tank conferences and panel discussions with top officials from the Pentagon, Congress and the defense industry.

Monday

The Center for a New American Security hosts its annual conference in Washington featuring Vice President Joe Biden and Defense Secretary Ash Carter.

Tuesday

The American Enterprise Institute hosts the staff directors of the House and Senate Armed Services committees to discuss their respective defense authorization bills.

The Center for Strategic and International Studies hosts a panel discussion on the future of Army missile defense.

The Senate Armed Services Committee will consider the nominations of Marine Corps Lt. Gen. Thomas Waldhauser to become chief of U.S. Africa Command and Army Lt. Gen. Joseph Lengyel to become chief of the National Guard Bureau.

Wednesday

The House Armed Services Committee hosts a panel of U.S. defense officials to discuss military cyber operations.

Thursday

The Center for Strategic and International Studies hosts Army Chief of Staff Gen. Mark Milley to discuss the service's priorities.

Deltek hosts its Federal MarketView 2016 conference, featuring Ken Brennan, deputy director for services acquisition within the Pentagon's defense procurement and acquisition policy office.

Booz Allen Hamilton and the Center for Strategic and Budgetary Assessments hold the Directed Energy Summit, featuring Gen. Ellen Pawlikowski, commander of Air Force Materiel Command, and Vice Adm. James Syring, director of the Missile Defense Agency, among others.

Friday

The Center for Strategic and International Studies hosts Navy Adm. Philip Davidson, chief of U.S. Fleet Forces Command, to discuss fleet design in the current environment.