By Emelie Rutherford

President Barack Obama signed into law on Wednesday a temporary federal budget bill that allows the Navy to change its acquisition strategy for littoral ships and keeps the F-35 second engine program going.

The House and Senate on Tuesday passed the continuing resolution (CR), which continues the fiscal year 2011 budget largely at FY ’10 levels until March 4. A previous temporary CR expired at the end of the day Tuesday.

The new CR grants the Navy permission to scrap plans to buy 10 Littoral Combat Ships (LCSs) from either the Austal USA or Lockheed Martin [LMT]-Marinette Marine, and instead use both ship designs and buy 10 copies of each. Under the new acquisition strategy, the Navy would buy 20 instead of 19 LCSs over the next five years. Because the shipbuilders offered lower-than-expected prices in their bids, Navy officials said, the dual-buy approach would save the government $2.9 billion.

Senate Armed Services Committee Ranking Member John McCain (R-Ariz.) opposed the new LCS acquisition plan, criticizing it comments he submitted to the Congressional Record Tuesday, but was not able to block its approval within the CR in the Senate.

While there have been questions regarding whether the March 4 CR would fund the F-35 Joint Strike Fighter’s second and alternate engine, developed by General Electric [GE] and Rolls-Royce. Obama and Defense Secretary Robert Gates want to stop developing the engine that has significant support in Congress.

Sen. Sherrod Brown (D-Ohio), a second-engine supporter, said Tuesday he received confirmation from White House Office of Management and Budget (OMB) Director Jacob Lew that the CR would continue funding the alternate engine.

Brown sent Lew a letter asking if the Obama administration would fund the second engine if the CR passes.

“OMB responded that the Continuing Resolution, as drafted, would follow Congressional intent and continue the competitive engine program,” Brown’s statement said.

However, Sen. Joseph Lieberman (I/D-Conn.), in whose state Pratt & Whitney’s [UTX] primary engine is built, argued Lew’s letter contradicts “OMB’s own guidelines about funding programs under a continuing resolution and is inconsistent with the strong opposition of President Obama and Secretary Gates to this second engine.”

Also, the Senate on Wednesday passed the policy-setting defense authorization bill for FY ’11 last night, clearing it for Obama’s approval.

The House last Friday passed compromise authorization legislation, which House and Senate lawmakers hashed out two days earlier.

That authorization bill no longer contains a specific authorization for the F-35 second engine.