UPDATED: Mike Wynne Comments.
Rep. Jack Murtha's House Appropriation defense subcommittee has granted the Pentagon some latitude for the tanker program, giving it the choice of a single or dual buy. Perhaps more importantly, Murtha says the Pentagon should double the number of planes it buys each year so it doesn't leave the nation with some tankers that are 80 years old by the time the 513-fleet is rebuilt.
As we reported earlier, the bill contained $440 million for the tanker deal, whatever shape it might take.
"During this period, the Air Force will invest billions of taxpayer dollars in maintenance of an ever aging and increasingly unreliable fleet. Based on studies conducted by the Department of Defense, total fleet costs are anticipated to increase from $2.1 billion per year to $3 billion per year by 2040 due to increasing depot maintenance and forecasted modernization programs in avionics and aircraft systems. Additionally, the Department anticipates depot maintenance costs increasing from $320,000,000 to $1,100,000,000 in 2040 due to aging aircraft related maintenance," the report says.
There are a few conditions in the bill language. The Pentagon gets to choose either a single contract award "based on a best value or lowest cost source selection derived from full and open competition, subject to the condition that non-development aircraft produced under such contract must be finally assembled in the United States." This will include analysis of "the life-cycle costs of each aircraft over a 40-year period (including costs of fuel consumption, military construction and other factors normally associated with operation and support of tanker aircraft) and shall include an independent 40-year life-cycle cost estimate conducted by a federally funded research and development center."
If that choice isn't palatable -- and it would appear from a quick read to be tilted to Boeing -- then the Pentagon can issue a contract to two companies as long as the planes are "finally assembled" in the US. Imagine the number of lawyers it will take to determine just what constitutes "finally assembled..."
Mike Wynne, former Air Force secretary, said in an email that Murtha's committee seemed to be making the right moves. "The House appropriators have recognized that a dual award might be a good idea because of the litigious nature of our procurement system, and that doubling the rate of acquisition of tankers to 24 units a year would reflect less than a quarter of the rate they were procured in the late 1950’s; both excellent suggestions. But this has left to the SecDef the actual decision; and he has already opined on the subject and is very likely not inclined to listen to this sage advice," Wynne wrote. Gates should change his mind, the former secretary said, because, "without tankers, we can hardly call ourselves an expeditionary power."
One of the capital's best known defense analysts also said the HAC-D was on the right track.
"Mr. Murtha is right about the inefficiency of the proposed tanker buy. At 15 planes per year, it would take three decades to replace the current fleet of Eisenhower-era KC-135s. That means heavy maintenance costs to keep the legacy fleet flying, at the same time new tankers are being bought at uneconomical rate," Loren Thompson of the Lexington Institute said in an email.
Also, the Defense Secretary must certify in writing by October that its choice "represents the most cost-effective and expeditious tanker replacement strategy that best responds to U.S. national security requirements."
Murtha does offer a sweetener to the Pentagon, at least in terms of rationale for doubling the purchase rate. "The lower cost per flying hour alone will save the taxpayer $1,795,500,000 per year for a fleet of 513 aircraft (current total aircraft inventory) or $3,500,000 per plane per year replaced," the report says.
In addition, the report language requires a study "that includes a description of key mission requirement and performance parameters that will be used as the basis for determining the key selection criteria in the source selection process; a full and complete characterization and definition of “best value”; a description of the process that the Department of Defense intends to use to ensure open, balanced and transparent communications with potential offerors; and a full description of the corrections made to the source selection process that addresses the issues raised by the Government Accountability Office in it’s 'Statement Regarding the Bid Protest Decision Resolving the Aerial Refueling Tanker Protest by the Boeing Company, B311344 et.al, June 18, 2008.' "