A year-long continuing resolution (CR) threatens to end Air Force negotiations with Lockheed Martin [LMT] over a multi-year deal worth billions of dollars for more than 75 C-130J aircraft, Assistant Secretary of the Air Force for Acquisition William LaPlante said Tuesday.
“Has [this] ever been done before?” LaPlante asked at a Defense One event in Arlington, Va., adding that the Air Force was about ready to reach a deal. “Well, we might do it this year if we have a year-long CR. So it’s pretty severe.”
Lockheed Martin spokeswoman Stephanie Stinn said Tuesday the proposed buy would be for 78 aircraft spread among the Air Force, Marine Corps and Coast Guard, with the Air Force getting “the bulk” of the buy. According to a 2013 DoD budget document, the total value of the proposed deal would be $5.8 billion in 2013 dollars. Delivery would be over five years. The Air Force and Lockheed Martin reached a similar deal in 2003 when the Air Force agreed to purchase 60 aircraft for itself and the Marine Corps for $4 billion.
Stinn said the Air Force would receive 29 MC-130Js, 29 C-130J-30s and 13 HC-130Js. The MC-130J, she said, is for special operations; the HC-130J for search and rescue; and the C-130J-30 is the combat delivery stretch model. The Marine Corps would receive six KC-130J aerial refueling tankers while the Coast Guard would receive one HC-130J with an option for five additional HC-130Js.
Air Force leadership has been making the Washington speaking rounds decrying the effect a year-long CR would have on modernization and acquisition efforts. Along with Secretary Deborah James in September, LaPlante said Tuesday that a year-long CR would be worse than sequestration related budget caps. Continuing resolutions do not allow for new start programs nor modest fleet upsizing, as James said. As it funds programs at the level of the previous fiscal year, a long-term CR is also viewed as a budget cut as it doesn’t provide the necessary spending increases per program, nor does it account for inflation.
Participating in a panel with fellow service acquisition executives Heidi Shyu from the Army, Sean Stackley from the Navy and Under Secretary of Defense for Acquisition, Technology and Logistics (AT&L) Frank Kendall, LaPlante said budget uncertainty costs the Air Force millions of dollars. He recounted the Air Force’s effort to award a Space Fence contract in 2013 before a two-week government shutdown put a wrench in the service’s plan.
LaPlante said the service balked on awarding the Space Fence contract at the end of fiscal year 2013 because it would have to cancel the program if it didn’t receive the budget it expected for the next fiscal year. When the Air Force came around to awarding the contract after reaching some budget certainty, LaPlante said the prices were no longer good for the proposal, forcing the Air Force to perform another source selection, which he said cost the Air Force an extra $120 million and a year delay on its initial operational capability goal (IOC). Space Fence, a space situational awareness (SSA) radar for objects in low earth orbit (LEO), eventually went to Lockheed Martin.
The Air Force did not respond to requests for comment by press time Tuesday.