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Army Breaks Up FCS

Lawmakers, or at least the one lawmaker who returned to the hearing after a room clearing floor vote, Rep. Neil Abercrombie, who chairs the Air and Land Forces Subcommittee of the House Armed Services Committee, tried to get an answer today on the status of the Army’s FCS program. Conflicting press reports this week had DoD claiming the entire program had been terminated while the Army said no, in fact just the ground vehicle part had been cancelled, the rest of the program would continue.

It turns out the Army will break apart the program formerly known as FCS into three separate programs; one for new ground combat vehicles, another for technological upgrades or “spin-outs” that will go to all Army units, and a third for a communications network and software, said Army acquisition leader Lt. Gen. Ross Thompson. The confusion as to the program’s status came about because the Army had been awaiting completion of the FCS System of Systems Preliminary Design Review, which is now finished, and for “official guidance” on the way forward in the form of an acquisition decision memorandum from Pentagon acquisition chief Ashton Carter.

Once they get the memo, which should happen in the next few days, the Army will issue a stop work order on the Manned Ground Vehicle portion of the FCS contract and will then renegotiate the details of the remaining contract parts with Boeing, Thompson said. The restructured contract will “redefine” the relationship with Boeing and with subordinate contractors such as General Dynamics and BAE, the companies that were building the vehicles. What portion of the three new Army orders will go to Boeing has yet to be determined.

The Army wants the “best competitive acquisition approach” before it places a new order for what it now calls "Ground Combat Vehicles," which probably won’t be until the fall, Thompson said. The Army is relooking the requirements for the vehicles and will make sure lessons learned from the current wars, in other words better protection against IEDs, are built into the vehicle design.

The Army’s original order was for delivery of 15 armored brigades. That order has now been cancelled, which means Boeing is due cancellation fees. Abercrombie said that according to his own back of the envelope calculation, killing the entire FCS program would mean Boeing gets on the order of $1 billion in termination fees, so killing the vehicles, and the “trifurcation” of the program, should entail some fraction of that figure. Since the vehicles were by far the biggest part of the original FCS program, killing them will cost taxpayers the “major portion” of that amount, said David Ahern, from the acquisition shop in OSD. He said the final figure is under negotiation.

Abercrombie said he was troubled by a $415 million charge in the current budget for software development. That money is to comply with National Security Agency software “protection requirements,” to secure the Army’s mobile communications and battle command networks from hostile attack, Thompson said. In order to get NSA certification that their networks can’t be hacked, it will cost the Army hundreds of millions of dollars, and the network hasn’t even been built yet. Look for that price tag to go up.

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