Tanker News 27 June

The following tanker related items caught our eye:

Tanker Recompete Act Introduced:
U.S. Representative Todd Tiahrt (KS), U.S. Senators Pat Roberts (KS) and Sam Brownback (KS) introduced the KC-X Tanker Recompete Act in both the U.S. House of Representatives and the U.S. Senate. The legislation would prohibit use of any funds by the Department of Defense (DoD) on the KC-X Tanker unless the DoD chooses to outright award the KC-X tanker to Boeing or decides to fairly recompete the KC-X contract.

Chairman Waxman Announces Tanker Hearing:
The House Oversight Committee Announces Tanker Hearing for July 15 to examine the actions of the Air Force in awarding the contract to manufacture aerial refueling tanker aircraft. The Honorable Gene L. Dodaro, Acting Comptroller General of the United States (Head of the GAO) will testify.

Labor Unions Deliver Letters in Support of Boeing to Congress:
Twenty-three unions,labor federations and affiliated organizations have signed and delivered a letter to House and Senate lawmakers calling for Boeing to be immediately awarded the Air Force refueling tanker contract.

Citing the Government Accountability Office (GAO) report that said the KC-30 tanker lacked the ability to refuel all of the Air Force's aircraft and calling Boeing's KC-767 "the clear winner" in the competition to replace the Air Force's aging fleet of tankers, the labor groups urged Congress to award the contract to Boeing without delay.

AFP: Gates Says No decision yet on US air tanker purchase
Key passage:

"I haven't made any decisions yet," Gates said. "But I would say that I take the GAO report very seriously. They've clearly pointed out some areas where we were deficient.

"We've clearly had problems with the tanker contract. And this time around is not the first time, obviously. And so, I think I need to get a better feel for the GAO report and for the criticisms and the nature of the criticisms that they have made."

Congress is now out of session until 7 July, so Gates has some time to think it over before everyone gets back in town. After that, the pressure that has already building will become extreme. DoD has until mid-August to respond to the GAO decision, but no one expects them to try to run the clock down and punt to the next administration.

EADS Tanker Funding May Stall in FY2009

In an article published yesterday, former Republican presidential candidate Senator Sam Brownback states that the Air Force's decision to award the tanker deal to France-based Airbus instead of Boeing is not over.

The closing line of the article is the most telling. Senator Brownback,

"states he is hopeful that when the U.S. House sends the fiscal year 2009 defense bill to the Senate it will include language that 'slows down' the Airbus contract, and the Senate will act in similar fashion."

In the FY09 budget the Air Force has requested $831.759 M for the "Next Generation Aerial Refueling Aircraft", which is a new budget item. (Source: pg 34, line #83 of FY09 RTD&E Programs Budget) It also still has available in FY09 $239.8 M from the "Tanker Replacement Transfer Fund," which are funds remaining from FY05 and FY08 appropriations that went unspent.

So, the total to be available to the Air Force if allowed to continue with the purchase of the EADS tanker in FY09 would be $1.0716 billion. Given the overwhelming sentiment of both the House and the Senate, the Air Force should not expect authorization or appropriation of anywhere near that amount.