Congress yesterday barred the Air Force from pursuing a $23 billion deal to lease and then buy tankers from Boeing Co. and raised the possibility that European rival Airbus SAS could compete to build the refueling planes.
The action ends a three-year-old defense program that spurred a federal investigation, the resignation of Boeing's chief executive and a nine-month prison sentence for a former Air Force official who admitted inflating the contract's price to help her job prospects at Boeing.
_____Essential Background_____
•
Deal Would Bar Lease of Boeing 767s (The Washington Post, Oct 8, 2004)
•
EADS May Sue Over Pricing Data (The Washington Post, Oct 7, 2004)
•
Ex-Air Force Official Gets Prison Time (The Washington Post, Oct 2, 2004)
•
Report Examines Defense Hiring (The Washington Post, Jun 29, 2004)
•
Boeing Deal Skipped Protocol, Report Says (The Washington Post, May 19, 2004)
•
Ex-Pentagon Official Admits Job Deal (The Washington Post, Apr 21, 2004)
•
Boeing Lax on Hiring By Rules, Review Finds (The Washington Post, Mar 10, 2004)
•
SEC Probes Dismissal of 2 Boeing Executives (The Washington Post, Mar 6, 2004)
•
Federal Prosecutors Probing 2 Ex-Employees of Boeing (The Washington Post, Dec 13, 2003)
•
Boeing Fires 2 Top Officials In Hiring Probe (The Washington Post, Nov 25, 2003)
•
Air Force-Boeing Negotiator Criticized (The Washington Post, Oct 27, 2003)
•
New Questions Raised About Boeing Deal (The Washington Post, Oct 8, 2003)
•
U.S. Probes Actions Of Boeing Executive (The Washington Post, Sep 4, 2003)
|
| |
|
Under the 2005 defense authorization bill that won final House and Senate approval yesterday, the Air Force can buy as many as 100 of the refueling aircraft through a traditional purchase but not lease them initially, as had been planned. The measure sets aside $100 million to start the program and requires the Air Force to hold a competition for a $5 billion contract to maintain the aircraft. Boeing had been awarded the maintenance work without competition.
Even as they approved the conference report on the $422 billion defense bill, House and Senate members remained split on the outcome for Boeing. Senate members argued that the Air Force is now required to hold a competition to build the refueling planes, which would allow Airbus to compete for the work.
"Any program to acquire tankers must start from the beginning . . . on a traditional budget, procurement, and authorization track," Sen. John McCain (R-Ariz.), the chief critic of the lease-buy strategy, said in an exchange on the Senate floor with Sen. John W. Warner (R-Va.), chairman of the Senate Armed Services Committee. Warner said he agreed.
But House members, including Rep. Duncan Hunter (R-Calif.), chairman of the House Armed Services Committee, disagreed.
"The most important point is we don't have to go back and have another procurement, because if we did that it would take years and years before we would start getting the tankers," said Rep. Norman D. Dicks (D-Wash.), whose district includes thousands of Boeing workers. "And I believe it's the position of the Congress that this is going to be built by an American company."
The Air Force began pushing the program to modernize its fleet of more than 500 aging refueling planes in 2001, arguing had the 40-year-old aircraft were being used heavily in Iraq and Afghanistan and had corrosion problems. Leasing reconfigured 767 passenger planes from Boeing and then buying them at the end of the lease contracts would be more expensive overall but would cost less in the early years, Air Force officials said, and would allow the planes to be delivered quickly.
Critics have complained that the program was an expensive bailout for Boeing's 767 production line. And the merits of the program were overshadowed last year by controversy over improprieties.
Boeing fired former Air Force procurement officer Darleen A. Druyun for negotiating her job with the company while overseeing Boeing's work at the Air Force, including negotiating the tanker deal. Chief executive and chairman Philip M. Condit resigned after Druyun's dismissal.
Get paid for your H I P I M P L A N T troubles.>>