Air Force Could Request Continuing Resolution Waivers for Top Programs

The Air Force might seek relief from funding restrictions that would affect the KC-46 tanker and F-35 Joint Strike Fighter programs if Congress passes an extended continuing resolution to keep the federal government open, a high-ranking service official said.

Lawmakers are expected to pass a CR before the end of the fiscal year on Sept. 30 to keep the government running as the budget impasse in Washington, D.C. drags on. Defense officials and analysts are concerned that Congress will continue to kick the can down the road and use continuing resolutions to fund the Pentagon for the remainder of fiscal year 2016.

Lt. Gen. Arnold Bunch, military deputy to the assistant secretary of the Air Force for acquisition, warned about the consequences of a year-long CR.

“The way that production goes … we’re limited to what we could do the year before,” he said at an Air Force Association breakfast Sept. 24. “If we start trying to buy more [than we did in fiscal year 2015] we can’t, we’re capped. So that’s the situation that we find ourselves in on those acquisition programs where we’re requiring new assets.”

The Air Force is planning on issuing two low-rate initial production awards for 19 new tankers next year. The Defense Department signed a $4.9 billion contract with Boeing for a fleet of KC-46s. For fiscal year 2016, the Pentagon is planning on purchasing 57 F-35s from Lockheed Martin, up from 38 in fiscal year 2015. Bunch said a CR would hit those programs hard and potentially force the Defense Department to break contracts with industry.

“If we get a year-long continuing resolution it will impact F-35 production, it will impact KC-46 production. And there is a chance that we may have to go in and open up some contracts,” he said. “I don’t think any of us believe we want to go in and do [that] right now.”

To avoid going down that road, the Defense Department might ask lawmakers to waive CR restrictions on the KC-46, Bunch said.

“Right now we haven’t done that because we’re hoping it’s a short-term continuing resolution. But it will probably be one of the ones that we go back in and look for a waiver to” if there is an extended CR, he said.

He also raised the possibility that a waiver will be requested for the F-35.

“That will be a decision we make at the time based on looking at what the ripple effects are and the cost impacts of what we’re trying to do,” Bunch said. “We will be balancing all aspects. So there will be multiple things” that the Defense Department would consider when it comes to asking for waivers.

He said the Air Force has “a little bit of time” before it would need to make a decision about which programs would be selected for waiver requests.

In his speech, Bunch noted that a CR would affect many acquisition projects, not just the biggest ones. He said it would derail about 50 new starts and hinder programs that are slated to move up a gear.

“If I have $4 million or $5 million [in fiscal year 2015] to try to get something started and I’ve got $60 or $80 million coming in next year to really get off and running … there’s no way that I’m going to be able to ramp up and be able to get that out in the field” if there is an extended CR, he said.

Topics: Aviation, Defense Department, DOD Budget