By Emelie Rutherford
Lawmakers are putting pressure on the Pentagon to consider the potential impact on U.S. jobs when awarding contracts for large acquisition programs.
Lawmakers critical of the Air Force’s now-canceled contract award for aerial refueling tankers to a Northrop Grumman [NOC]-European Aeronautic Defence and Space Co. (EADS) team argued the service should have considered the impact on U.S. jobs when weighing bids from two competing teams. Supporters of bidder Boeing [BA] claimed there would be a negative impact on U.S. jobs if the Northrop Grumman team prevailed.
The final version of the fiscal year 2009 defense authorization bill, which was awaiting final Senate passage as of Defense Daily‘s deadline last Friday, requires the defense secretary to issue guidance regarding “the appropriate application of the authority” in two sections of U.S. Code that require agencies to alter contract competitions so that suppliers are available during national emergencies and industrial mobilizations.
This defense guidance, according to the bill, also would have to delve in to how the Pentagon follows another part of the U.S. Code–section 2440 of Title 10–that requires the defense secretary to “prescribe regulations requiring consideration of the national technology and industrial base in the development and implementation of acquisition plans for each major defense acquisition program.”
It’s this section 2440 of Title 10 of the U.S. Code that some lawmakers have claimed the Pentagon does not adequately follow.
The Pentagon says it currently meets the requirement by conducting industrial capabilities assessments.
Yet Boeing backer Rep. Norm Dicks (D-Wash.) questioned if the Air Force adequately considered the U.S. industrial base when it initially awarded the tanker contract to Northrop Grumman.
“They were supposed to do that in the first place, and I’m not sure they did,” said Dicks, vice chairman if the House Appropriations Defense subcommittee (HAC-D). “But they’ll have to do again. Whoever the new administration is will have to do this, look at U.S. industrial base.”
Thus, an explanatory statement for the final version of the FY ’09 defense appropriations bill–which the HAC-D helped craft–specifically says: “The Secretary of Defense is directed to comply with 10 U.S.C. 2440 as it applies to the consideration of national technology and industrial base in the development and implementation of acquisition plans for each major defense acquisition program.”
The appropriations legislation also directs the defense secretary to report to Congress on “how the Department implements Section 2440 in the major defense acquisition programs.”
The defense appropriations bill–embedded in a continuing resolution (CR) temporarily extending most government spending–also was awaiting final Senate passage last Friday, as of Defense Daily‘s deadline, before landing on the president’s desk.
Aides said the industrial-base-related language in the final defense authorization and appropriations bills is meant to signal to the Pentagon that it does have a legal requirement to consider U.S. jobs when awarding lucrative contracts.
When the Air Force came under fire for awarding the tanker contract to Northrop Grumman and a European firm over Boeing in Feb. 29, Air Force acquisition czar Sue Payton maintained it was her job to choose a new tanker based on criteria that did not include the industrial base.
Payton told reporters that current legal exemptions under the Buy America Act instruct the department to treat allied countries as part of the U.S. industrial base, and that was the law she complied with. She said the service based its decision on mission capability, proposal risk, past performance, cost price and an integrated fleet aerial refueling rating–and that the U.S. economic impact did not factor into the decision (Defense Daily, March 4, 6).