Defense Watch

Obama’s Navy. President Barack Obama tells Naval Academy graduates that he’ll “keep fighting for the capabilities and technologies you need to prevail.” That includes “a shipbuilding plan that puts us on track to achieve a 300-ship fleet, with capabilities that exceed the power of the next dozen navies combined,” he says at the May 24 commencement ceremony in Annapolis, Md. He tells the graduates: “We need you to project power across the oceans, from the Pacific to the Persian Gulf–100 percent on watch.” He further calls for them to partner with “other navies and militaries from Africa to the Americas” and respond to disasters. He said despite the tough fiscal times, “the United States of America will always maintain our military superiority.”

…Sequester Stab. Obama adds he’ll “keep fighting” to end the $500 billion in decade-long “sequestration” budget cuts, which started in March. He calls the cuts “foolish” and says they are “threatening our readiness.” He says that “it’s time for Congress to budget in a smarter way that protects middle-class priorities, preserves investments in our future, and keeps our military strong–because we have the best-trained, best-led, best-equipped military in history, and I am determined to keep it that way, and Congress should be, too.” Obama and congressional Democrats are at odds with Republican lawmakers over stopping the sequestration cuts.

Reprogramming Run. The congressional defense committees, as if May 24, continue to weigh the $9.6 billion reprogramming request the Pentagon sent them the previous week. The reprogramming proposal would shift around fiscal year 2013 funds already in the Pentagon’s coffers. It comes as the Pentagon is facing across-the-board sequestration budget cuts, which are projected to tap $37 billion in FY ’13–with $20 billion coming from operation and maintenance accounts. Still, Pentagon spokesman George Little reportedly tells reporters the reprogramming request is intended to fill shortfalls in fuel bills and in Overseas Contingency Operations (OCO) funding for wars. He says on May 20 that the reprogramming is “not meant to offset the effects of sequestration.” Congress also is weighing a $79.4 billion FY ’13 OCO request the Pentagon sent two weeks ago, which is smaller than FY ’13 OCO funding of $86.5 billion.

Debarment Considered. OSI Systems, which makes X-ray systems and metal detectors used at airport checkpoints in the United States, as well as cargo scanning systems and whole body imagers, says its Security Division has been notified of Notice of Proposed Debarment from the Department of Homeland Security. The debarment notice stems from a show cause letter the Transportation Security Administration sent the company last November, alleging it did not disclose changes it made to its whole body imager and related automated target recognition software during testing. OSI Systems says the receipt of the notice will allow its Rapiscan Systems division to begin communicating with DHS officials for the first time since receipt of the Show Cause letter. The company believes it has complied with all obligations with the TSA. At the worst, to varying degrees Rapiscan could be debarred from new federal contracts and task orders.

…Low Risk. Analysts that follow the company believe the risk of debarment is very low, minimizing the financial risk to the company. Benchmark Company analyst Josephine Millward notes that OSI Systems has previously reached a settlement with the TSA related to the AIT issues raised in the Show Cause letter, but she warns that since the company can’t seek or accept new federal contracts upon receipt of the debarment notice, the biggest risk could be the timing of a resolution. She says the company is expecting a Foreign Military Sale order worth up to $200 million for Iraq and that reaching a resolution with DHS could take longer than expected. Millward believes a fine is likely.

New Business Unit. The biometric and identity management solutions provider Cross Match Technologies has established a new business unit, Cross Match Ventures, which is looking for industry partners to quickly bring biometric and identity management solutions to commercial markets while still keeping in mind the company’s legacy customers. The new business unit will aim to bring end-to-end solutions to markets in months rather than years, Glenn Hickok, president of Cross Match Ventures, tells our sister publication Homeland Security Report. He says the business will take advantage of Cross Match’s core strength in sensor development and design, and then team with application providers who are already entrenched in emerging markets and others that know how to market to these sectors to go after opportunities faster.

Homeland Cooperation with India. Homeland Security Secretary Janet Napolitano last week met with her counterpart from India, Minister of Home Affairs Sushil Kumar Shinde, to strengthen the strategic partnership between the United States and India on issues ranging from cyber security and megacity policing to counter-terrorism and countering violent extremism. The two countries plan to enhance cyber security and critical infrastructure protection engagement, identify areas where both can collaborate on science and technology development and its application in the homeland security context, and more, DHS says.

CNO Praise For X-47B. Chief of Naval Operations Adm. Jonathan Greenert says the recent launch of the X-47B from an aircraft carrier, the first for an unmanned aerial vehicle, marked a new era of naval aviation. He tells a gathering Tuesday the ability to operate UAVs off an aircraft carrier will make a “huge difference” in terms of payloads, providing a persistent presence and for intelligence, surveillance and reconnaissance mission. “This is a great opening to a new chapter in carrier aviation,” Greenert says at an event in downtown Washington hosted by the Center for a New American Security. The Northrop Grumman-built X-47B flew off the USS George H.W. Bush on May 14 under a demonstration program that will be followed by the Unmanned Carrier Launched Surveillance and Strike (UCLASS) program. The Navy hopes to operationally field that system by the end of the decade. Several defense firms in addition to Northrop Grumman are competing for the UCLASS program.

DDG Keel. General Dynamics has laid the keel for the second ship in the Zumwalt class (DDG-1000) of destroyers. The keel laying ceremony took place Thursday at the defense firm’s Bath Iron Works yard in Maine. The future USS Michael Monssor is the second of three destroyer planned in the Zumwalt class of guided missile and land attack destroyers. Petty Office Second Class Michael Monsoor was a Navy SEAL who died in Iraq in 2006 after jumping on a grenade to save the lives of his fellow SEALS and some Iraqi soldiers. He was posthumously awarded the Medal of Honor.

KC-46A Basing. The Air Force announces finalists for the KC-46A aerial refueling tanker program. The Air Force prefers Altus AFB, Okla., as the preferred alternative for the KC-46A aerial refueling tanker formal training unit, according to a service statement. McConnell AFB, Kan., is the service’s preferred alternative for the first active duty-led KC-46A main operating base while Fairchild AFB, Wash., and Grand Forks AFB, N.D., are the reasonable alternatives. The Air Force’s preferred alternative for the first Air National Guard tanker main operating base is Pease Air Guard Station, N.H., while the reasonable alternatives are Forbes Air Guard Station, Kan., Joint Base McGuire-Dix-Lakehurst, N.J., Pittsburgh International Airport Air Guard Station, Pa., and Rickenbacker Air Guard Station, Ohio. The 179 planned KC-46As are the first phase of a three-phase effort to replace more than 400 KC-135 and 59 KC-10 aircraft.

F/A-18C TOFT. The Kuwait Air Force (KAF) accepts two F/A-18C Tactical Operational Flight Trainers (TOFTs), according to an L-3 statement. The high-fidelity F/A-18C TOFTs replace the KAF’s F/A-18 Weapons Tactics Trainers that were initially delivered by L-3 in 1996. The networked simulators enable KAF pilots to jointly conduct simulated air-to-air and air-to-ground tactics, normal and emergency procedures and night vision goggle operations in a robust, synthetic environment.

ATK HPGP. ATK successfully completes the first U.S.-based testing of the High Performance Green Propulsion (HPGP) thruster technology for the NASA Goddard Space Flight Center, according to a company statement. HPGP is a green propulsion alternative that has been flight-proven in space to provide increased performance over traditional hydrazine propulsion technology. HPGP, by comparison, is significantly safer and more cost-effective in terms of storage, material handling, transportation and launch-site processing. ATK conducted its testing at its facility in Elkton, Md., in April.

Protecting American IP. The Treasury Secretary should be able to close the banking system to foreign firms that have stolen intellectual property from the United States, according a to a new report from the independent Commission on the Theft of American Intellectual Property. The report suggests that participation in the American marketplace is a “principal interest of firms desiring to become global industrial leaders.” A prerequisite for joining the market is protecting IP. The commission is the co-chaired by former Director of National Intelligence Dennis Blair and former Ambassador to China John Huntsman.
Contractor Collaboration On Cyber. Mike Papay, Northrop Grumman vice president and chief information security officer, has said that major defense contractors share information on cyber attacks. Last week Papay was part of a panel of Northrop Grumman executives promoting the company’s use of embedded cyber protections in the development phase of their platforms and products instead of adding them in later. Concerning emebedded cyber practices, Papay says there has not been any official agreement among contractors to make embedded cybersecurity standards similar, though their platforms are likely to run into each other on the battlefield. “I imagine that eventually all of the contractors will be looking at it from this perspective. I think we’re one of the first,” Papay says. As for a future meeting, he says, “We’d be happy to support it.”