The Insider

Senate Armed Services Committee Chairman Carl Levin (D-MI) today released a letter from the Pentagon stating the department's opposition to House legislation that would add mention of the Marine Corps to name of the Navy Department and the title of the Navy secretary.

The House Armed Services Committee's fiscal year 2011 defense authorization bill includes the provision, which is the brainchild of Rep. Walter Jones (R-NC). In recent years, House authorizers have repeatedly tried and failed to enact the proposal, which has never survived the conference process with the Senate Armed Services Committee. The May 26 letter from DOD General Counsel Jeh Johnson is the latest shot across the legislation's bow.

"In our view, the renaming of the Department is unnecessary, would incur additional expense of several hundred thousand dollars a year over the next several years (according to a Congressional Budget Office estimate) and would not enhance the standing or reputation of the Marine Corps," Johnson writes. "A re-designation could be viewed as more than symbolic, and could easily be misinterpreted as a step away from the heritage and tradition of a strong Navy and Marine Corps team." The Navy and Marine Corps have been one team led by one secretary since Benjamin Stoddert was named the first Navy secretary by President Adams in 1798, Johnson notes.

Boeing is still advocating the CH-47 Chinook and V-22 Osprey for the VXX presidential helicopter mission despite launching a new relationship with AgustaWestland for U.S. production of the AW-101 medium-lift helicopter, Phil Dunford, vice president and general manager for Boeing Rotorcraft Systems, said today.

Dunford declined to say whether Boeing will ultimately offer a mix of at least two of those platforms for its VXX bid. Boeing will craft its offer based on what the Navy's analyses of alternatives says about factors such as the performance, "productivity" and the cost of VXX aircraft, he added. Those findings might become apparent in August, he said. Boeing will face competition from a Sikorsky-Lockheed Martin team that plans to offer Sikorsky’s H-92 helicopter. The new Boeing-AgustaWestland relationship for the AW-10 is solely for the VXX program, Dunford said.

According to a Boeing statement, the deal "will give Boeing full intellectual property, data and production rights for the aircraft in support of the VXX program. Because of this arrangement, the aircraft will be a Boeing aircraft, built by Boeing personnel at one of its U.S. facilities. The company will submit information regarding this aircraft in response to the Navy's current Request for Information by the June 18 deadline."

Meanwhile, EADS North America is seizing on the AW-101 deal to criticize its rival Boeing's rhetoric in the Air Force KC-X tanker competition. The AW-101 (also known as the EH-101 and US-101) is based on a foreign design, just like EADS' tanker bid.

“We’re pleased that Boeing has openly acknowledged the contribution that international teams, products and platforms make to U.S. national security,” EADS said in a statement. “For several years, Boeing and its allies have been harshly critical of the participation of EADS North America in the KC-X tanker competition. With this announcement, we now expect Boeing to cease its shrill rhetoric and finally allow the KC-X competition to focus on the merits of the tanker offerings.”

Pentagon acquisition executive Ashton Carter has issued a memo on fundamental research that broadens guidance issued by his predecessor, John Young, on contracted fundamental research. Much of Carter's memo echoes Young's guidance, but there's a key change, according to Robin Staffin, the Pentagon's director of basic science.

"The Secretary maintains his strong support for basic research," Staffin tells us through a spokeswoman. "Since the 2008 memo, it became apparent that there were cases where fundamental research was funded by subcontract from industry with funding categories 6.3 or above, in addition to direct DOD university grants. This memo now covers these cases."

Here's a key section of Carter's May 24 memo:

There will be circumstances in which the DOD Components may find it valuable to perform research with other Budget Activity funds (e.g., Budget Activity 3 and higher) without placing restrictions on publications or personnel. This should be within the discretion of acquisition personnel in consultation with contracting officers, Component management, counsel, and the cognizant Comptroller to ensure consistency with financial management regulations. In addition, the DOD must not place restrictions on subcontracted unclassified research that has been scoped, negotiated, and determined to be fundamental research within the definition of NSDD 189 according to the prime contractor and research performer and certified by the contracting component, except as provided in applicable federal statutes, regulations, or executive orders. Provisions shall be made to accommodate such subcontracts for fundamental research and to ensure DOD restrictions on the prime contract do not flow down to the performer(s) of such research.

The RAND Corp. has come out with a new study on ways to build security in the Persian Gulf.

"Since the 2003 invasion of Iraq, the United States has found itself deeply – perhaps permanently – engaged in providing security throughout the region of the Persian Gulf and beyond," a RAND statement released today reads. "But how can the United States help create conditions that will foster greater security and stability in the region? Can it do so at potentially reduced cost to itself in blood, treasure and opportunities foregone elsewhere? And how can it enlist others in the effort?"

To that end, a new study by the organization "lays out the criteria and parameters for a new security structure for the Persian Gulf region that seeks to answer these questions."

The study, titled "Building Security In The Persian Gulf," is written by Robert Hunter, a RAND senior adviser and former U.S. ambassador to NATO under President Clinton. Hunter also served as a senior National Security Council official for the Middle East under President Carter. It "covers seven region-specific parameters that need to be considered in developing a new security structure," according to the statement. They are:

* The future of Iraq;
* Iran and its roles;
* Asymmetrical threats;
* Regional reassurance;
* The Arab-Israeli conflict; regional tensions,
* Crises and conflicts; and
* The roles of other external actors.

Hunter's study also "canvasses potential roles and/or models that include NATO, the European Union, an Organization for Security and Cooperation in the Persian Gulf, an Association of Persian Gulf Nations, and several arms control and confidence-building measures, such as political and military commissions, formal U.S. security commitments, an incidents at sea agreement, a counter-piracy convention and cooperation against terrorism." Additionally:

Within the context of fully securing U.S. interests and those of its friends and allies, the study also examines ways to reduce the long-term burdens placed on the United States in terms of military engagement, the financial cost of providing security risks, including to U.S. forces, and opportunity costs, especially in relation to East and South Asia, the Russian Federation and management of the global economy.

As Congress continues to pore over the Obama administration's fiscal year 2011 defense budget request, a group of Army financial planners is preparing to meet next month to talk about a vital part of Pentagon budgeting -- how each and every dollar is spent each year.

The Army Financial Improvement Plan Conference/Workshop will be held June 28-29 in the Pentagon, according to the meeting agenda. Army Under Secretary Joseph Westphal and Pentagon Comptroller Robert Hale are scheduled to speak.

The agenda lays out why the meeting is being held:

The conference objective is to inform attendees of Army auditability efforts and outline the Army's approach to obtaining auditability. The conference will address the business processes and controls that lead to audit readiness within the DOD, the importance of new systems (e.g. GFEBS, LMP, and GCSS-Army), the short-term goals to achieve auditability of the Statement of Budgetary Resources and assert the existence and completeness of mission critical assets and the roles the Chief Management Officer and the Army's Office of Business Transformation will play in obtaining and sustaining auditability. This two-day conference focuses on the audit executing roadmap, which includes critical preparatory steps affecting all Army commands.

For years Congress has leaned on the Pentagon to get what is called a "clean audit." Several members of Congress have argued that without knowing where the money is going, no type of budget reform is possible for DOD.

Sen. Tom Coburn (R-OK) recently wrote to President Obama's National Commission on Fiscal Responsibility and Reform, which is trying to tackle the U.S. national deficit problem. After laying out what he sees as serious problems with the nation's defense budget, Coburn offered several steps that could be taken to control defense costs. Coburn's first step may be of interest to the folks attending the Army's June meeting:

Begin a crash program to have the Pentagon pass a financial audit; To provide the necessary incentive for a financial audit the “base” Pentagon budget should be frozen in FY2012 at the FY2011 level. Unless and until all major components and all major defense acquisition programs are certified by the Inspector General or an independent public accountant for an unqualified audit opinion, spending for those components and those programs should remain frozen. This freeze should not apply to any spending for direct support of overseas contingency operations or Defense Department personnel and wounded warrior accounts. If the Secretary of Defense or Congress asserts that a freeze will harm the national security of the United States or our troops in combat, funding may be increased but only by equally reducing other Defense Department components or programs.

The Senate just approved the fiscal year 2010 supplemental spending bill by a 69-29 vote.

The legislation would boost Pentagon procurement accounts by $512 million to buy new aircraft, ground vehicles and other equipment needed for operations in Afghanistan and Iraq, a move that would bring spending on new weapons in the supplemental request to $4.9 billion.

Earlier this month, the Senate Appropriations Committee agreed to a $32.7 billion FY-10 war cost supplemental spending request to help pay for the addition of 30,000 U.S. military personnel President Obama last fall ordered to Afghanistan. As InsideDefense.com reported on May 17:

The package hikes procurement spending above DOD-requested sums, including $104.3 million for the Army; $207.8 million for the Navy; $144 million for the Marine Corps; and $55.8 million for the Air Force.

These figures are detailed in the 90-page committee report accompanying the spending bill. InsideDefense.com obtained a copy of the report.

While the procurement accounts saw increases, DOD's $25 billion request for operations and maintenance accounts was cut by $435.5 million to $24.5 billion; and the $1.8 billion request for personnel spending was trimmed by $108 million to $1.7 billion.

The procurement accounts received funding to replace two “battle-loss” Army helicopters, an AH-64 and an UH-60. Also, the Senate measure would fund ballistic protection for Army helicopters.

The bill would fully fund five MC-12 Liberty aircraft for the Air Force.

Further, the Senate panel would add funds to “improve the Army's automated biometric identification capacity,” according to a statement.

The Missile Defense Agency wants to gauge the interest of potential contractors in the agency's follow-on effort to the command, control, battle management and communications (C2BMC) program, according to a May 20 Federal Business Opportunities notice.

With responses due by June 21, MDA seeks the following information from interested contractors:

a. Company profile to include number of employees, annual revenue history, office locations, DUNs number, etc.

b. Explanation of the respondent’s ability to perform the capabilities described above (in whole or in part). This should include a description of the company’s effort in the past three years in support of same/similar requirement(s). Include information such as contract number (indicate if your role was a prime or subcontractor), organization supported, contract value, Government points of contact and current telephone numbers, and a brief description of how the contract referenced relates to the technical services described herein. Of particular interest are past performance examples where the company has developed international capabilities with host nations that share resources and sustain interoperability with U.S. systems; experiences where company has managed multiple contractors in a unified team developing capabilities; and experiences in fast-paced, dynamic programs with constant requirements change.

c. Describe the company's recommended approach to transition work from the current provider to ensure no break in C2BMC service and operation, and minimize schedule impact derived from transition. The company should also discuss whether it currently has specific expertise needed to execute the activities described in this RFI, or how it would gain such expertise.

d. If the company recommends parts of the C2BMC Program for separate development, provide the strategy to seamlessly integrate its parts with the other parts it is not providing with minimal schedule, cost, and performance risk.

e. Describe the company's approach in fostering relationships within and across the BMDS Elements and their respective industry team (to include, but not limited to GMD, THAAD, and Aegis BMD) to ensure responsive and efficient working relationships.

f. Describe the company's recommendation on how to foster innovation within the C2BMC Program to provide new approaches to C2BMC development. Alternate approaches to C2BMC architecture and development may be considered. Explain the alternate approach and provide examples of its performance.

The Pentagon's latest operational test and evaluation report, released in January, recommended that MDA revise its Integrated Master Test Plan “to incorporate the operationally realistic testing needed to support the phased, adaptive approach to providing missile defense for Europe.” The Ballistic Missile Defense System elements that need updating in the plan include: the C2BMC system; Aegis Ballistic Missile Defense; Ground-based Midcourse Defense; and sensors.