Nominee questions tanker process

WASHINGTON -- The nominee to lead the Air Force said Tuesday a recent report detailing numerous problems with a $35 billion tanker contract was "troubling," and he is planning reviews of the service's process of awarding contracts.

In response to questions submitted to the Senate Armed Services Committee, acting Air Force Secretary Michael Donley said that while he didn't think the service's procurement system was "fatally flawed," it needs improvement.

"We need to strengthen confidence in the Air Force and the (Department of Defense) to manage these large, complex competitions," Donley said later during his opening statement.

Donley said he planned two 90-day reviews of the Air Force's procurement system, which has come under fire after the decision earlier this year to award the aerial refueling tanker contract to a team of Northrop Grumman Corp. and Airbus parent European Aeronautic Defense and Space Co. over The Boeing Co.

Chicago-based Boeing protested the decision, and the Government Accountability Office listed "significant errors" in a report last month on the award. The Air Force now plans to rebid the contract.

Donley was nominated to replace former Secretary Michael Wynne, and Gen. Norton Schwartz was nominated to replace former Air Force Chief of Staff Gen. Michael Moseley last month after the pair were fired following a series of mix-ups involving nuclear weapons.

Sen. John Warner, R-Va., pressed Donley on his statement that the service's procurement system was not deeply flawed, saying recent problems suggest otherwise.

"To me, when you make a statement that it is not fatally flawed against a background of a lot of problems, I find a lot of disconnect," Warner said.

The Air Force plans to replace 179 of its aging aerial refueling planes, some of which date back to the 1950s.

The service hopes to have the new planes flying by 2013, but many analysts have said the problems with the contract award will likely push that date back.

The GAO concluded in its review that the Air Force did not review the Boeing and Northrop-EADS bids on the same merits and that it showed preference to the Northrop team. The award also created an uproar since Los Angeles-based Northrop has teamed with a European partner, which some lawmakers said would siphon jobs away from the U.S.

Donley said the aerospace industry is inherently international, as most domestic contractors do large amounts of business overseas. But former presidential candidate Sen. Hillary Clinton, D-N.Y., took issue with that logic.

"I am also extremely conscious of the impact of decisions made by our government with taxpayer dollars that undermines our competitiveness for the long run," she said.

The nominations of Wynne and Schwartz, which need Senate approval, come as other big acquisition decisions loom for the service. Those include the F-22 fighter jet, which was built for the Cold War and has been sharply criticized because of its high price tag, about $160 million per plane.

Current plans call for capping the program at 183 planes, and manufacturer Lockheed Martin Corp. said it expected a final decision would be put off until a new administration takes office. Schwartz told lawmakers he thought that 183 should be the low end of production, but that other proposals to build as many as 381 F-22s are probably too high.