Pentagon issues stop-work order for presidential helicopter

[Muttocracy]

http://www.pressconnects.com/article/20090516/BUSINESS/905160415/

Pentagon issues stop-work order for presidential helicopter
Lockheed shuts down project at Owego

By My-Ly Nguyen • [e-mail] • Staff Writer • May 16, 2009

OWEGO - The presidential helicopter program at Lockheed Martin in Owego came to a screeching halt late Friday afternoon when the Pentagon issued a stop-work order.

The move was not entirely unexpected, though Lockheed said it didn't receive the news from the Navy program office until after 5 p.m. Friday, when most of the company's employees had already left for the day. President Barack Obama's administration had previously recommended cutting the $13 billion program from the proposed fiscal 2010 defense budget.

Starting Monday, Lockheed will begin going through the list of its roughly 800-person presidential helicopter team to decide which employees it will temporarily reassign to other projects at the Owego plant, including possibly the Joint Light Tactical Vehicle program or postal programs, spokesman Tom Greer said.

Lockheed had already planned on laying off about 225 workers in the coming days. Mid-May is the only timetable the company will provide. The facility employs roughly 4,000 people.

Greer said the stop-work order "doesn't change our approach to the previously announced reduction in force, but it does increase the likelihood that further reduction is going to be necessary in the months ahead. I can't qualify at this time."

U.S. Rep. Maurice Hinchey, D-Hurley, whose district includes Owego, called the Pentagon's decision "irrational and fiscally irresponsible."

Hinchey has been among the politicians with constituents in the Binghamton area who have been extremely vocal about efforts to save the program. Hinchey on Tuesday said he sent a letter to Ashton Carter, under secretary of defense for acquisition, technology and logistics, urging him not to issue the stop-work order.

To date, roughly $3.2 billion has been spent on the program. It is estimated it will take at least another $400 million to shut it down.

Hinchey noted the order calls for the Navy to develop a new presidential helicopter construction plan within 30 days, a timeline he called "unrealistic," especially considering the current project has been underway since Lockheed won the contract in 2005.

Greer said the stop-work order "gives the government, the customer, a temporary pause in the program. It's in effect for 90 days unless there's a mutually agreed extension to it. ... All we can do is stand by and abide by the terms of the stop-work and await further direction from the Navy."
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All nine of the production and test copters in Increment One, or the first phase of the program, are in some stage of test or integration at different locations, including Lockheed in Owego and the Navy Air Station facility in Patuxent River, Md., Greer said.

Increment Two, which called for 23 production helicopters and some test aircraft, had been on its own stop-work order since 2007 as the program's costs increased from $6.1 billion to the current $13 billion.

"There's nothing in stop-work that determines what happens to those aircraft at this time," Greer said.

The Navy said it continues to review a range of options, including sales to interested parties, contractor buyback or potential applications to other Defense Department needs.

[lapfog_1]

1. Let's see... $13B v. 800 jobs

Cut everyone a check for $250,000 and a pat on the back for a job well done...

and you would still save the tax payers $12.8 Billion dollars.

I guess there might be a bit of pork in those helicopters.

[Muttocracy]

2. the number are astounding

"To date, roughly $3.2 billion has been spent on the program. It is estimated it will take at least another $400 million to shut it down."

You'd think the Southern Tier of NY would be rolling in dough instead of desperate for natural gas money.

[lapfog_1]

3. No, but some offshore Lockheed account is getting very fat...

As well as some Lockheed executives.

[ProgressiveProfessor]

5. Not quite what happened

There had been a couple of false starts, this was only the most recent version. However they are attributing all costs to it. Not exactly fair, but it makes it easier to condemn it. Also remember that Lockheed was the prime, and most of the work was not being done in Owego.

I for one am disappointed that it is being shut down for technical reasons. The current helos are adequate at best and death traps for the passengers can crew if their is a serious mishap. If Marine 1 goes down hard, we will be calling Joe Biden "Mr President". That might not be true in the new model that was to be built.

The one hope there might be is for the USN to continue a limited in house effort based on current airframes. Would be a lower cost option that while not having all current program envisioned, would still be better than what is there today.

[Muttocracy]

6. thanks for your thoughts

[ControlledDemolition]

8. Just before 911 it was announced that the Pentagon could not account for a couple of trillion! n/t

[ThomWV]

4. Generally speaking if a Stop Work Order is taken to a termination it cost more

Stop work orders are always temporary but they may be the precursor of a termination, either for cause for the convenience of the Government (the former for frauds and the latter normally used when funding is cut for an existing program). However although any Government contract can be terminated for convenience its generally less expensive overall for the Government to just let the contract continue until the money runs out. There are two universal Government contract clauses that limit the Government's exposure to the lower of either funds obligated (Limitation of funds clause) or the face cost of the contract (Limitation of Cost clause).

[Muttocracy]

7. thanks for that info. nt