President Barack Obama could veto the Pentagon authorization bill now before the House because of language intended to keep alive the F-35 Joint Strike Fighter’s alternate engine, the White House said yesterday.

“If the final bill presented to the president includes funding or a legislative direction to continue an extra engine program, the president’s senior advisors would recommend a veto,” the Office of Management and Budget (OMB) said in a Statement of Administration policy. It was issued as the House prepared to debate the $690 billion policy-setting defense authorization bill for fiscal year 2012, which begins Oct. 1.

The statement says the White House “strongly objects” to section 215 of the bill. It would ban the Pentagon from spending money on “performance improvements” to the main F135 engine, made by Pratt & Whitney [UTX], if the defense secretary does not support the alternate engine, developed by General Electric [GE] and Rolls-Royce.

The Pentagon believes the alternate engine program is unneeded and too expensive, and terminated it last month shortly after Congress voted to kill FY ’11 funding for it. Yet the engine effort has high-level supporters in Congress, who maintain having competition improves both engines and the long-term cost of keeping or canceling the second engine is nearly the same. The contracting team has offered to spend its own money to continue developing it through the end of FY ‘12.

Leaders of the House Armed Services Committee (HASC) endorsed the language in section 215 that would force the Pentagon to keep alive the second engine if it wants to make performance improvements to the primary one.

The OMB’s statement yesterday says as “the test program unfolds, some improvements are likely to be needed.”

“And this would result in the continued development of an extra engine that adds significant extra costs to the program for something the Administration and the Department of Defense (DoD) have determined is not needed and would destabilize the F-35 program when it is beginning to stabilize,” the statement says. “Additionally, section 215 would delay development of the main engine and affect the viability of the short take off and vertical landing variant.”

The bill also contains a provision that would allow General Electric and Rolls-Royce to use the F136 equipment so the contracting team can continue working on the second engine with its own money. The legislative language calls for the Pentagon to preserve and store F136 equipment so that work can be restarted on the F136 engine.

“The administration also strongly objects to section 252, which requires the (defense) secretary to store and preserve the property developed under the F136 program–a termination that ended an unnecessary and extravagant expense, particularly during this period of fiscal restraint,” the White House says. “The legislation would constitute a new requirement for the preservation and storage of over 250,000 pieces of government property located with hundreds of suppliers and add costs for preserving and storing that property.” 

In response, General Electric-Rolls-Royce argued in a statement that defense bill would “not constitute a new requirement,” because, it said, “the preservation and storage is already occurring under the termination order issued by the Department of Defense.”

“In allowing GE and Rolls-Royce to continue running the F136 development engines, the Fighter Team would actually save the government money–instead of incurring the cost to store them,” the contracting team said in the statement.

“The government is willing to spend millions and millions of dollars to terminate the F136 engine, when we (GE/Rolls-Royce) seek to continue running the development engines in FY2012 at a GE facility, on the Fighter Team’s dime,” it maintained. “The effort would protect the $3 billion investment already made in the F136 engine.”

The OMB cited two additional items in the defense bill that could trigger a presidential veto, related to nuclear force levels and military detainees.

In Congress, the House Rules Committee held a second hearing yesterday afternoon on the defense authorization bill to determine which amendments members can debate on the House floor this week.

Rep. Tom Rooney (R-Fla.) and other alternate-engine foes surprised some observers by not proposing any amendments to the defense authorization bill to strike language supporting the second engine.

Rooney, in a statement, said he did not propose any amendments to strike the F136 language because the “House, Senate, White House and Pentagon have all spoken on this issue and made clear that there is no funding for the wasteful extra engine.”

“While I am concerned that some language in the bill seems designed to keep the extra engine on life support, I am pleased that the bill does not include any funding for the development of that unnecessary program,” Rooney said. “This fight has always been about spending and cost. When we’re facing tight budgets and threats from around the globe, we cannot waste scarce tax dollars on a defense program that the Pentagon has said repeatedly it does not want or need.  Should subsequent budgets seek actual funds for a second engine, we will fight those battles as they come. In the meantime, the Congress has spoken, and the taxpayers are the real winners.”

The House Appropriations Defense subcommittee is scheduled to mark up its budget-setting defense appropriations bill on June 1. The Senate Armed Services committee is planning to craft its version of the policy-setting defense authorization bill in three weeks.