The Insider

Coverage of last week's "Quad-A" confab, missile defense and more highlight this Monday INSIDER Daily Digest.

Inside Defense's coverage of the recent Army Aviation Association of America symposium in Atlanta:

Key decisions due soon for next-gen Army helicopters

ATLANTA -- The Army’s plan to overhaul its aviation platforms is nearing a critical point, according to a program official.

Army scrambling to balance modernization, readiness

ATLANTA -- The Army is working to balance readiness and modernization at "one of the most challenging times in history," while the service aims to provide soldiers with the most reliable and effective equipment, according to the principal civilian deputy to the Assistant Secretary of the Army for acquisition, logistics and technology.

Training and Doctrine Command chief weighs key Army mandates

ATLANTA -- In order to "win in a complex world," the Army needs to satisfy first-order principles that address the ever-changing global environment, according to the head of U.S. Army Training and Doctrine Command.

Continuing our coverage of GAO's annual missile defense report:

GAO: reliability risks could trip up MDA plan to meet expanded GBI fielding in 2017

The Obama administration's 2013 directive to bolster defense of the United States by 2017 against the North Korean ballistic missile threat could be tripped up by reliability issues stemming from the Missile Defense Agency's "optimistic and aggressive" schedule for fielding a new variant of the Ground-based Midcourse Defense interceptor, according to a congressional audit.

JLENS could get revived:

House bill sets stage for antimissile blimp to be pumped up elsewhere

The House Armed Services Committee last week passed a defense policy bill calling on U.S. Northern Command to think about where next to deploy the Joint Land Attack Cruise Missile Defense Elevated Netted Sensor after a mishap near Baltimore last year.

The National Sea-based Deterrence Fund could be getting SSBN(X) money:

Navy: Ohio-class replacement money to be deposited in deterrence fund

The Navy is planning to deposit shipbuilding funds appropriated for the Ohio-class replacement program in fiscal year 2017 into the National Sea-based Deterrence Fund, according to the service.

Insitu, a wholly owned subsidiary of Boeing, said today it has formed a new commercial business unit to use its experience in unmanned systems to win work in the unmanned commercial aerial data collection market.

It will offer software for operating unmanned systems, software for collecting and processing multi-sensor data and aerial data collection experts.

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

1. The Navy is planning to deposit shipbuilding funds appropriated for the Ohio-class replacement program in fiscal year 2017 into the National Sea-based Deterrence Fund.

Full Story: Navy: Ohio-class replacement money to be deposited in deterrence fund

2.  Naval Air Systems Command is planning to design a replacement emergency oxygen system for the F/A-18 fleet that will provide higher volume and pressure compared to the existing system.

Full Story: Navy is designing a replacement emergency oxygen system for the F/A-18

3. The Navy recently revealed that the future unmanned tanker that will operate from an aircraft carrier will have follow-on increments to include precision weapons targeting, a radar and will be able to receive aerial refueling.

Full Story: Navy reveals follow-on increments for unmanned tanker program

(This regular feature highlights protests decided by the Government Accountability Office.)

Agency: Navy

Awardee: PAE Aviation and Technical Services

Protester: M7 Aerospace

What GAO found: M7 protested the Navy's award of a contract to PAE for maintenance and logistics support services for the F-5 Adversary aircraft fleet, arguing the agency "misevaluated proposals and made an unreasonable source selection."

"M7 argues that the record here is completely lacking in documentation to support the agency’s evaluation finding that all six proposals -- and more specifically its and the awardee’s proposal -- were technically equivalent," the GAO report states.

GAO finds that the record "does not include any information to support the conclusion that the agency, in making its source selection decision, performed a meaningful, qualitative assessment or critical, comparative analysis of the proposals under the technical evaluation factor or its enumerated elements."

However, there were "substantial differences" in the two companies' proposed staffing, according to GAO.

Without any explanation in the record, GAO states that it is "left to guess" at the reasonableness of the agency's conclusion that the proposals were technically equal and sustains the protest.

It recommends the Navy reevaluate all of the offerors' technical proposals and prepare a detailed record. Following that reevaluation, GAO adds, the agency should make a new source selection decision.

Read the decision.

Two industry groups have sent a letter to Pentagon acquisition chief Frank Kendall arguing the Defense Information Systems Agency is wrongly using the lowest-priced, technically acceptable contracting approach for its multiple-award vehicle, worth up to $17.5 billion.

The letter, sent last week by the Professional Services Council and the IT Alliance for Public Sector, is aimed at the ENCORE III program, for which the request for proposals was released in March.

"In our opinion, LPTA is the incorrect source selection process to use for ENCORE III, and its use directly contradicts your March 2015 memo on the appropriate use of LPTA," the letter says. "We have repeatedly raised our concern about the use of LPTA for ENCORE III and we have received no substantive response from DISA."

In the 2015 memo the letter references, Kendall wrote that LPTA is the appropriate approach "only when there are well-defined requirements, the risk of unsuccessful contract performance is minimal, price is a significant factor in the source selection, and there is neither value, need, nor willingness to pay for higher performance."

Industry executives have long complained LPTA is being overused, and Kendall has publicly said he's clarified DOD's policy.

But the new letter claims the "technological complexity" of the solutions to be bought under ENCORE III as well as the "disparate technical capabilities" of competitors necessitate a different buying strategy.

The letter says it "is troubling that a contract used to procure such complex information technology (IT) services intended to support 'information superiority' is being awarded on price and not the qualities that would deliver a technological edge to our warfighters" and argues that a cost/technical tradeoff source selection approach should be used.

Eight former defense secretaries -- Democrats and Republicans alike, including Republicans who served Democratic presidents -- have written to congressional leaders urging passage of the Trans-Pacific Partnership on national security grounds.

TPP "is an important step in the process of furthering peace and increasing prosperity here in America and around the globe," they write. "The TPP will deepen relationships with allies in the Asia-Pacific region, strengthen the U.S. economy, establish high standards that mirror U.S. interests and values, and contribute to a safer world for ourselves, our children, and our grandchildren."

The trade deal between the United States and 11 other Pacific Rim countries was signed in February after years of negotiations. Congress may take it up this year, most likely in a lame-duck session after the November elections, but its passage is anything but assured.

The former defense secretaries single out "engagement and leadership in Asia" as "especially critical," calling the region the most important for American prosperity and security over the next century. "By 2030, two-thirds of the world's middle class -- more than 3 billion people -- will reside in Asia. This population not only represents a critical consumer base for Made-in-America exports, but an opportunity to strengthen alliances with regional powers such as Japan and Singapore," the letter states.

Then they get to the trade deal:

The TPP represents a choice for the United States. It is a choice between leading the world toward a future that supports U.S. values and interests, or standing back and allowing others -- most likely China -- to write the rules of the road for Asia in the 21st century. And let us be clear: trade rules written by China would not promote a trading system consistent with American interests and values.

The United States cannot and should not fall behind on the world stage. Our leadership in a troubled world is dependent on our military, diplomatic, and economic power. We cannot afford to weaken any element of our strength at this critical time. With a trade agreement of this magnitude, there will be elements that some dislike, but the overall benefits to our economy and national security cannot be overstated. We urge you to support the TPP and to help the United States maintain its leadership in the 21st century.

Signatories include Chuck Hagel, Leon Panetta and Robert Gates, who served under President Obama (Gates also served under President George W. Bush); Donald Rumsfeld (Bush and Gerald Ford); William Cohen and William Perry (Bill Clinton); Frank Carlucci (Ronald Reagan); and Harold Brown (Jimmy Carter).

Oshkosh said today sales in its defense business during its most recent quarter grew 87 percent to hit $297 million.

"The increase in sales was primarily due to increased sales of Family of Heavy Tactical Vehicles . . . and international Mine Resistant Ambush Protected All-Terrain Vehicles," the company said. "The company experienced a break in production under the FHTV program in the second quarter of fiscal 2015."

Oshkosh's defense unit reported quarterly profit of $27.8 million, up from a loss of $12 million in the same three-month period a year earlier.

"The outlook for our defense business has continued to improve," Wilson Jones, Oshkosh's chief executive, said during a call with analysts today. "We now expect a production ramp-up of the [Joint Light Tactical Vehicle] will be quicker than we previously expected."