The Pentagon’s Broken Book-keeping

Defense reform critics like Chuck Spinney, and government organizations like the GAO, have complained for years that the Pentagon’s accounting system is broken. Considerable amounts of money are still being spent trying to improve the services’ systems in order to realize a “clean audit,” but the DoD’s books are such a mess that its accountants aren’t wasting any money by trying to run comprehensive audits. Last year, Managing Director Gregory D. Kutz of the Government Accountability Office told Congress that these accounting problems would cost taxpayers approximately $13 billion in 2005. Indeed, the GAO has classified the Pentagon’s accounting systems as “high risk” since the 1990s.

Now the Raleigh-Durham News & Observer has a report that details the extent of the problem, and the troubles these systems are causing for some troops in the field. But why do the problems persist, even after all of these years?

$2.6 Bn in Last-Minute Cuts to US Army’s Heavy Forces Biting Deep

M1A2 Abrams TUSK

InsideDefense.com describes the ripple effect spreading outward from eleventh hour cuts to the Army’s portion of the FY 2006 supplemental spending request, which stripped more than $2.6 billion for key improvements to Abrams tanks, Bradley fighting vehicles, and other armored vehicle programs. It notes that these cuts will have significant effects, depriving the Army of key urban survival kits for its tanks, slowing modernization of the fleet and of a number of units, and driving up the price paid in the end while seriously disrupting production lines in the short term.

These effects also highlight some of the points that Straus Military Reform Project head Winslow Wheeler recently made about the budgetary process.

$12.3M for 350 Mid-Range Tow Tractors

Small business qualifier TUG Technologies Corp. in Marietta, GA received a $12.3 million modification to a previously awarded firm-fixed-price contract (N68335-04-C-0111) to exercise an option for the procurement of 350 Mid-Range Tow Tractors for use in moving aircraft and equipment up to 80,000 pounds. Work will be performed in Marietta, GA and is expected to be complete in April 2008. The Naval Air Warfare Center Aircraft Division at Lakehurst, NJ issued the contract.

USMC Goes For the Turret Option With New LAV-A2s

Marines showin’ some LAV

In February 2006, the US Marine Corps was about to buy 130 new LAV-A2 8×8 armored vehicles in seven variants. The contract was worth $257 million, potentially rising to $307 million if an option for electric turrets was exercised. General Dynamics Land Systems just announced that it was, via a $49 million contract for electric turret drives to retrofit U.S. Marine Corps Light Armored Vehicles (LAV). General Dynamics will provide 394 electric turret drives for existing LAVs, some of which entered service in the 1980s.

The LAV-A2 is an improved version that is equipped with an electric turret drive and improved suspension. It is also fitted for enhanced armor protection and features an automatic fire suppression system for crew protection. The four rear wheels drive the vehicle on a full-time basis, but eight-wheel drive is selectable for more challenging terrain.

$7.8M Building for Security Forces’ Vehicles at Minot AFB, ND

Small business qualifier Rolac Contracting Inc. in Minot, ND won a $7.8 million firm-fixed-price contract for Construction of a Security Forces Vehicle Building at Minot Air Force Base, ND. The base hosts the 5th Bomb Wing’s B-52s and the 91st Space Wing’s Minuteman III nuclear ICBMs.

There were 165 bids solicited on Oct. 12, 2005, and 2 bids were received. Work is expected to be completed by June 12, 2007. The U.S. Army Corps of Engineers in Omaha, NB issued the contract (W9128F-06-C-0012).

P&W, Rolls Royce Define Cooperation on F135 Jet Engine

F-35B: lift fan open

In January 2006 changes in the F-35 Joint Strike Fighter program were proposed in the Pentagon’s FY 2007 budget request. One of those cuts was to the F-35′s engine choice program when the contenders were issued $3.43 billion in contracts in August 2005. The General Electric/Rolls Royce F136 would be canceled, and the entire contract (and implicitly, future spares and maintenance) awarded to Pratt & Whitney’s F135, currently powering the F-35 JSF test fleet.

Given Britain’s $2 billion participation as the only other Tier 1 partner with the USA, the implied snub to Britain was not taken well. Engine choice programs have worked well for the F-16 and F-15 fighters, and Congress may yet decide to restore this competitive aspect of the program in order to keep future costs in line. If not, however, Pratt & Whitney has moved to sign a Memorandum of Understanding with Rolls Royce to define their future collaboration on the F135 engine, which may also help them take some of the steam out of British lobbying efforts to reinstate engine choice. This remains to be seen, of course.

At the same time, testing has resumed on the GE/RR F136 under the $2.4B System Design and Demonstration contract that was awarded in August of 2005.

General Dynamics Looks to Canada for Ammo-Related Acquisition

In September 2005 General Dynamics had just become a second-source prime for small-caliber ammunition to the US military, as a result of the Army’s small-caliber ammunition shortage. This broke Alliance Techsystems’ sole lock on the prime supplier position from its single remaining plant in Lake City, MO. That award may be having ripple effects now, as General Dynamics has just entered a definitive agreement to acquire Canadian ammunition system integrator SNC Technologies Inc., a wholly owned subsidiary of SNC-Lavalin Group Inc., for approximately $275 million (CDN$ 315 million).

AGM-154 JSOW Wins US DoD Acquisition Award

JSOW-A: Not confetti…
(click to view larger)

The USA’s AGM-154 Joint Stand-Off Weapon (JSOW) precision glide-bomb has proven to be popular with the US DoD as well as foreign buyers. Indeed, the program has gone so well that the U.S. Department of Defense presented Raytheon’s JSOW program with its highest acquisition honor in November 2005. The David Packard Excellence in Acquisition Award is given to civilian and military organizations that have made highly significant contributions or demonstrated exemplary innovations and best practices in the defense acquisition process.

Block II JSOW manufacturing began in FY 2006, maintaining all standoff and survivability capabilities but costing less.

$26M for CH-46 Sea Knight Engine Improvements and TiN Anti-Sand Coatings

CH-46E Sea Knight

General Electric Aircraft Engines in Lynn, MA received a $26.4 million modification to a previously awarded firm-fixed-priced contract (N00019-02-C-3021) to purchase 60 T58 engine reliability improvement program (ERIP) module kits, including titanium nitride (TiN) coating of their engines’ compressor airfoil blades, for the Marine Corps CH-46E Sea Knight helicopters. In addition, this modification provides for the procurement of 96 TiN coated retrofit kits for modification of previously delivered ERIP Modules and TiN Miscellaneous Tooling.

DID has covered a similar contract before, and the British are now testing a similar coating for their own Lynx helicopters. Work will be performed in Lynn, MA and is expected to be complete in November 2007. The Naval Air Systems Command in Patuxent River, MD is the contracting activity.

TiN Coating Trialed to Keep British Lynx Helicopters Airborne in the Sandbox

Lynx, landing

A trial programme run by Britain’s Defence Logistic Organisation’s Helicopter Engines Integrated Project Team (HEIPT) is trying to reduce sand erosion to the Lynx helicopter Gem engine Low Pressure (LP) compressor blades. Iraq’s and Afghanistan’s environments cause significant erosion, forcing replacement with new blades, extra overhaul costs and lower availability stats. Attaching sand filters to the engines has helped, but not solved the problem.

The titanium nitride coating comprises both hard layers for surface protection and soft layers that have elastic properties to encourage particles to bounce off without penetrating; it also provides limited protection against Foreign Object Damage. The coating has an impressive provenance acquired during use on Russian helicopter engines, and in further separate testing in the United States, which uses it on the US Marines’ CH-46E Sea Knights. The test project follows extensive research into the effects of sand erosion undertaken in conjunction with engine designer Rolls Royce, and includes experts from the Defence Science and Technology Laboratory (DSTL) who will advise and independently assess all aspects of the project. If the trial goes well and the new coating performs as well as expected, MoD will consider whether to roll it out to the rest of the Lynx fleet. See full release for further information and statistics.