The Insider

NetCracker, CSC settle with U.S. government
By Marjorie Censer
November 3, 2015 at 9:43 AM

NetCracker Technology has agreed to pay $11.4 million and Computer Sciences Corp. has agreed to pay $1.35 million to resolve allegations they used individuals without security clearances on a Defense Information Systems Agency contract, the Justice Department said Monday.

The two companies implemented software that helps manage the telecommunications network used by the Pentagon, DOJ said in its announcement. CSC was the prime contractor on a DISA contract, while NetCracker was a subcontractor to CSC.

“From 2008 to 2013, NetCracker allegedly used employees without security clearances to perform work when it knew the contract required those individuals to have security clearances, resulting in CSC recklessly submitting false claims for payment to DISA,” the Justice Department alleged.

The settlement resolves a lawsuit filed under a whistleblower provision by a former NetCracker employee, who will receive nearly $2.4 million as his share, according to DOJ. The claims resolved remain allegations, and there has been no determination of liability.

In a statement provided to Inside Defense, NetCracker said it cooperated with the Justice Department. The company “explicitly denies liability for any wrongdoing.”

“We have always taken responsible steps to ensure that best practices are deployed when managing client information and that NetCracker is compliant with the terms of our contracts,” the statement continued. “We have decided that it is in the best interest of all stakeholders to settle the matter.”

CSC said in a statement provided to Inside Defense that “CSC believes it is as much a victim of NetCrack.

Rhodes touts U.S. special operators as 'force multiplier' in Syria
By Courtney McBride
November 2, 2015 at 3:44 PM

The White House’s deputy national security adviser said Nov. 2 that the U.S. special operators deploying to Syria will not have a combat mission, but acknowledged that in limited circumstances, they could play a combat role.

Ben Rhodes said during a DefenseOne event that special operators are “intended to be a force multiplier that will allow for those who are on the front lines of the fight against ISIL to be better coordinated, better equipped, and to hopefully have better results in taking back territory.”

Rhodes emphasized “the purpose of this mission -- just like the purpose of our presence in Iraq -- is not to have a constant raid capacity in the country. It’s to facilitate the operations of these other partners.”

Despite saying that combat “is not their principal function in being deployed,” Rhodes declined to rule out the possibility that special operators could be drawn into combat situations.

Asked about the Oct. 22 raid in Hawijah, Iraq, that resulted in the death of Master Sgt. Joshua Wheeler, Rhodes maintained that that instance “was more the exception than the rule.” He acknowledged the possibility that commanders on the ground in Syria could determine that “they’re under some type of threat that requires them to engage.”

Rhodes said “the norm for these operators is not going to be going out on raids. That’s not their mission.” Still, he continued, “they will make judgment calls” about whether to engage in combat situations on a case-by-case basis.

Challenging the contention that President Obama was going back on his word by sending the special operations contingent to Syria, Rhodes said the commander in chief is merely “changing the nature of how the United States engages in these countries and these conflicts.” The president is adamant, he said, “that we’re not going to take back ownership of security in Iraq and Syria -- or, for that matter, in Afghanistan. But, we need to find ways to use our very unique capabilities to support these other partners on the ground.”

Rhodes said the previous strategy of removing opposition forces from Syria, training them abroad, and reinserting them into the fight “was not working.”

The INSIDER Daily Digest
By
November 2, 2015 at 2:19 PM

We’re closely tracking today’s DefenseOne Summit, featuring some of the top defense officials. Here’s our coverage so far.

Thornberry: Planned spending cuts to be visible soon

The chairman of the House Armed Services Committee said he expects negotiators to finalize $5 billion in cuts to defense spending today, in accordance with the figures outlined in the two-year budget agreement reached last week and signed into law by President Obama on Monday.

ALSO: The Special Inspector General for Reconstruction in Afghanistan has issued a report detailing how $43 million was spent on a gas station in Afghanistan that should have cost $500,000.

Watchdog agency keeps sights set on disbanded OSD task force

The Pentagon’s special inspector general for Afghanistan reconstruction is blasting the Defense Department for continuing to disavow all knowledge of a business task force alleged to have wasted $800 million.

Monday means Army news, and we’ve got plenty. Here are several of the top headlines from Inside the Army.

Army official ties future of robotics revolution to open systems

The key to success in the brave new world of military robotic ground systems lies in the Army's ability to enforce open standards in future technology developments, a service official has argued.

Army is still in waiting mode on potential humvee modernization

The Army will hold off on making any decisions about a potential humvee-upgrade program until a study of the future fleet of light tactical vehicles is completed, according to a key service official.

Official: 'Philosophical' changes needed to prioritize lightness in vehicles

The Army has embraced the goal of making its vehicles lighter, even though there are fundamental changes needed in the approach to developing new systems, a service official said last week.

Despite Army general's calls, no plans to change U.S. campaign in Europe

Pentagon leaders so far appear unwilling to put a U.S. campaign aimed at reassuring European NATO members in the face of Russia's actions in Ukraine on a new footing, despite calls by an Army general to up the ante.

An In-Q-Tel executive last week took aim at the Pentagon’s approach to finding innovation in Silicon Valley, arguing it’s “short-sighted.”

Industry officials criticize Pentagon's approach to finding innovation

As the Pentagon looks to the West Coast for innovation, panelists at an event sponsored by several industry groups said the department should adapt its approach for pursuing cutting-edge technology.

We have two stories on the Pentagon’s challenges in Russia.

Countering Russia on ground in Baltics requires 3 to 4 heavy brigades: RAND

Three to four heavy combat brigade equipment sets -- provided by the Army and European allies -- along with increased troop rotations are needed in the Baltic states in order to offset a current Russian ground force military advantage in the region, according to the early findings of an Army-commissioned assessment by the RAND Corp.

EUCOM chief: U.S. changing intelligence priorities on Russia

During an Oct. 30 briefing at the Pentagon, the head of U.S. European Command said the intelligence community has moved to address a deficiency with respect to Russia -- a shift for which he is “thankful.”

Coming up tomorrow, the House Armed Services seapower subcommittee has scheduled a Navy aircraft carrier hearing featuring Sean Stackley, the service’s acquisition executive. Check out our latest coverage on aircraft carriers.

McCain: Navy Must Consider Pursuing Carrier Alternatives If Ford-Class Costs Are Not Contained

If the Navy cannot control the cost of its next-generation aircraft carrier fleet, then the service must be willing to pursue other alternatives such as building smaller, less expensive aircraft carriers to bring new competitors in the market, according to a report released by an influential senator.

Navy Must Better Identify Programmatic Risks Before Requesting Funding

The Navy must better identify programmatic risks before asking Congress to authorize and appropriate funding for a major acquisition program such as the multibillion-dollar Ford-class aircraft carrier, according to the service's acquisition executive.

Obama signs budget deal
By Tony Bertuca
November 2, 2015 at 12:27 PM

President Obama has signed the Bipartisan Budget Act of 2015, locking in the terms of the two-year budget deal Congress hammered out last week that would raise the debt ceiling and lift sequestration spending caps by $80 billion.

The total federal spending increase over the 2011 Budget Control Act caps will be $50 billion in fiscal year 2016 and $30 billion in FY-17, with the amounts divided equally between defense and domestic priorities. The additional spending would be funded by cuts to Medicare and Social Security entitlements and sales from the strategic petroleum oil reserve.

The Obama administration is poised to receive $33 billion of the $38 billion national defense spending increase it has sought for FY-16, according to the arrangement.

Congress now has until Dec. 11 to cobble together an FY-16 omnibus spending bill.

Inside the Navy Highlights
By Lee Hudson
November 2, 2015 at 11:03 AM

Highlights from this week's edition of Inside the Navy:

1. Officials at the Marine Corps Warfighting Laboratory made recommendations to senior leadership last month for filling capability gaps the service faces as it begins to build the fiscal year 2018 budget plan, according to the head of the lab.

Full story: Marine Corps futurists make recommendations on POM-18 investments

2. The Navy recently submitted the capabilities development document for a new amphibious warship to the Joint Staff and anticipates wrapping up the preliminary design phase for the ship -- dubbed LX(R) -- this spring.

Full story: Navy submits new amphib warship requirements document to Joint Staff

3. The top priority for the Navy's special warfare requirements branch is intelligence, surveillance and reconnaissance platforms and payloads.

Full story: Navy special warfare requirements top priority is ISR platforms, payloads
 

Booz Allen acquires SPARC unit
By Marjorie Censer
November 2, 2015 at 9:50 AM

Booz Allen Hamilton said today it has purchased the software services unit of SPARC, meant to bolster the contractor's agile software development capabilities.

Under the deal, Booz Allen has purchased the unit, its assets and about 270 employees, who work for the Department of Veterans Affairs as well as other public and private sector clients. The contractor said the acquisition will add about $50 million of incremental annual revenue in fiscal year 2017.

Week Ahead
By Tony Bertuca
October 30, 2015 at 5:33 PM

The week ahead promises exhaustive Inside Defense coverage of a conference featuring many Pentagon officials, several congressional hearings and President Obama's expected signature of the proposed 2015 Bipartisan Budget Agreement.

Defense Secretary Ash Carter is also traveling to the Asia Pacific this week including stops in South Korea, Malaysia, and Hawaii.

Monday

The DefenseOne Summit is scheduled to include discussions with Deputy Defense Secretary Bob Work, Army Chief of Staff Gen. Mark Milley, House Armed Services Committee Chairman Mac Thornberry (R-TX) and others.

Link: http://www.defenseone.com/feature/defense-one-summit-2015/

Obama is expected to sign the proposed budget agreement into law.

Tuesday

The House Armed Services seapower subcommittee has scheduled a Navy aircraft carrier hearing featuring Sean Stackley, the service acquisition executive.

Link: http://1.usa.gov/1Wm6CZ7

Harris reports quarterly earnings.

The House Armed Services strategic forces subcommittee is scheduled to hold a hearing on future options for the nuclear deterrent featuring experts from Project Atom.

Link: http://1.usa.gov/20gGgXS

The Senate Armed Services Committee has scheduled a hearing on the future of warfare featuring retired National Security Agency director Keith Alexander and others.

Link: http://1.usa.gov/1XFCUvl

Wednesday

CSC announces quarterly earnings.

Thursday

The Senate Armed Services Committee is scheduled to hold a hearing with think tank analysts and experts on the roles and missions of the U.S. armed forces.

Link: http://1.usa.gov/1kZJ23A

BWX Technologies, Huntington Ingalls and Kratos Defense & Security Solutions report quarterly earnings.

Pentagon discloses FY-15 military intelligence budget
By Tony Bertuca
October 30, 2015 at 2:45 PM

The Defense Department disclosed that its fiscal year 2015 appropriated budget for military intelligence programs is $16.5 billion, including both base and overseas contingency operations accounts.

“The department determined that releasing this top line figure does not jeopardize any classified activities within the MIP,” according to a DOD statement. “No other MIP budget figures or program details will be released, as they remain classified for national security reasons.”

In FY-14, DOD announced that its MIP budget was $17.4 billion.

Inside the Air Force Highlights
By Courtney Albon
October 30, 2015 at 2:00 PM

Highlights for this week's edition of Inside the Air Force:

1. The Air Force is reporting a new, six-month delay to milestone C for the Small Diameter Bomber II, pushing the weapon's expected required assets available date to January 2018.

Full story: Air Force estimates new six-month delay for initial fielding of SDB II

2. The Air Force has approved the Family of Advanced Beyond Line of Sight Terminal program for milestone C -- about six months later than expected.

Full story: FAB-T approved for low-rate initial production after six-month delay

3. Air Force officials are refining the service's MQ-9 acquisition strategy to better balance urgent needs with programmed upgrades.

Full story: Air Force develops new acquisition strategy for MQ-9 Reaper

Special ops forces headed to the ground in Syria
By Tony Bertuca
October 30, 2015 at 1:38 PM

White House Press Secretary Josh Earnest said today the United States will soon deploy “less than 50” U.S. special operations personnel to the ground in Syria to train and advise anti-government rebels to counter the Islamic State of Iraq and the Levant.

“These forces do not have a combat mission,” Earnest stressed, but acknowledged the forces would be exposed to danger and authorized to protect themselves as necessary.

However, “it will not be their responsibility to lead the charge to take a hill, but rather to offer advice and assistance to those local forces about the best way they can organize their efforts.”

Meanwhile, the Defense Department has scheduled a background briefing for 2 p.m.

Earnest said the deployment of the special operators represented the “intensification of elements of our strategy that have shown some promise.”

That strategy, Earnest said, still revolves around efforts to train indigenous forces to “take the fight to ISIL.”

Meanwhile, Defense Secretary Ash Carter recently told the Senate Armed Services Committee that the U.S. military will be re-working its counter-ISIL mission to include increased special operations raids and airstrikes.

"We won't hold back from supporting capable partners in opportunistic attacks against ISIL, or conducting such missions directly, whether by strikes from the air or direct action on the ground," he told the committee on Tuesday.

Protest Spotlight
By Marjorie Censer
October 30, 2015 at 11:58 AM

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

Agency: Naval Sea Systems Command

Awardee: Lockheed Martin

Protester: General Dynamics

What GAO found: General Dynamics protested the award of a contract for the Navy's surface electronic warfare improvement program block 1B3 full-rate production requirement to Lockheed, arguing the agency "conducted an unreasonable cost realism analysis."

GD contended the Navy wrongly assumed that it had proposed uncompensated overtime and, as a result, incorrectly adjusted the company's cost proposal upward. The Navy evaluated GD's cost at $24.96 million, about $10,000 higher than Lockheed's $24.95 million. The procurement was evaluated using the lowest-price, technically acceptable approach.

GAO backed GD, recommending the Navy perform a "reasonable cost realism evaluation" of the company's proposal. Additionally, the audit agency recommended the protesters be reimbursed the costs of pursuing the protest.

The decision: http://www.gao.gov/assets/680/673410.pdf

Rockwell Collins reports government sales down
By Marjorie Censer
October 30, 2015 at 11:05 AM

Rockwell Collins said today its government systems unit saw a decline in sales and earnings in the most recent quarter.

Quarterly sales hit $581 million, down 4 percent from the same three-month period a year earlier, while quarterly earnings declined 6 percent to reach $129 million.

The company said avionics sales increased "due to higher tanker/transport hardware deliveries," but Rockwell reported reduced rotary wing hardware and Joint Tactical Radio System Manpack sales.

The INSIDER Daily Digest
By John Liang
October 30, 2015 at 10:30 AM
Bomb Delay.

The Small Diameter Bomb II program is facing another delay:

Air Force estimates new six-month delay for initial fielding of SDB II

The Air Force has reported a six-month delay of a key acquisition milestone for Raytheon's Small Diameter Bomb II, bumping the target date for declaring the first batch of SDB II ready for operations from July 2017 to January 2018, a shift that reflects -- in part -- knock-on effects of earlier development delays with the 250-pound, precision-guided weapon.

Grab Bag.

Headlines from the front page of today's Inside the Air Force:

F-35 propulsion experts focused on limiting ALIS schedule risks

A top concern for F135 engine experts as the Air Force initial operational capability deadline approaches next summer is making sure the next release of the Joint Strike Fighter program's logistics information system is delivered on time, program officials said this week.

Air Force begins acquisition analysis for intellectual property study

The Air Force office of transformational innovation is conducting discussions with industry about current gaps and future requirements for intellectual property, the results of which will inform a pilot program which the service plans to launch next spring.

Otto calls for combined pilot and sensor operator solution for RPAs

The Air Force's deputy chief of intelligence dismissed enlisted personnel as the panacea for the Air Force's stressed remotely piloted aircraft teams, instead calling for a one-seat ground control station that would take more humans out of the cockpit.

FAB-T approved for low-rate initial production after six-month delay

The Pentagon this week approved the Air Force's Family of Advanced Beyond Line of Site Terminal program for milestone C, following a six-month delay.

Defense Biz.

More earnings news:

L-3 Communications reports loss for the quarter

Defense contractor L-3 Communications reported Thursday that third-quarter sales fell 4 percent to hit $2.8 billion, and the company reported a loss of $299 million for the three-month period.

'Risk Tolerance.'

The Navy's top civilian wants more money for fleet experimentation:

Navy has green light to suggest new funding levels for fleet experimentation

Navy Secretary Ray Mabus, bemoaning the lack of "risk tolerance" in technological development, is directing the service to send him recommendations to increase funding for fleet experimentation in fiscal year 2016 and beyond, according to a recent memo.

Document: Navy memo on resources and opportunities for experimentation

Remote Minehunting.

More than one team is looking at the Remote Minehunting System:

Program office, contractor team examining Remote Minehunting System

NORFOLK, VA -- While an independent review board analyzes the Navy's Remote Minehunting System, a second team comprised of program officers, testers and contractors is also examining the system to see where improvements could be made, according to a service official.

Huntington Ingalls names new CFO
By Marjorie Censer
October 30, 2015 at 10:00 AM

Huntington Ingalls said Friday its board has elected Christopher Kastner to succeed Barbara Niland as the company's chief financial officer, effective March 1.

Niland is set to retire.

Kastner currently serves as corporate vice president and general manager of corporate development. He has also previously served as CFO for HII's Ingalls Shipbuilding division and was CFO for Northrop Grumman Shipbuilding-Gulf Coast.

He started his career at Northrop -- which later spun off Huntington Ingalls -- working on the B-2 program, Huntington Ingalls said.

Budget deal headed to Obama for signature
By Tony Bertuca
October 30, 2015 at 9:57 AM

The Senate early this morning voted 64-35 to send the bipartisan two-year budget deal to the White House for President Obama's signature.

Lawmakers adjourned at 3:15 a.m. after approving the measure, which will raise the national debt limit and lift the 2011 Budget Control Act spending caps by $80 billion over the next two fiscal years.

Passage of the bill came after Sen. Rand Paul (R-KY), a presidential candidate, tried unsuccessfully to block the deal by raising a procedural point of order.

Analysts have told Inside Defense the bill is a significant victory for the Defense Department.

Obama, who worked with Republicans and Democrats to reach an accord on the spending, is expected to sign the proposed Bipartisan Budget Act of 2015 into law as soon as possible.