Letter to Deborah Lee James, Secretary of the Air Force - Air Force Evolved Expendable Launch Vehicle (EELV) Program
Letter
The Honorable Deborah Lee James
Secretary of the Air Force
U.S. Department of the Air Force
1670 Air Force Pentagon
Washington, DC 20330-1670
Dear Secretary James:
I write to obtain additional information about your recent testimony regarding the Evolved Expendable Launch Vehicle (EELV) program before the Senate Armed Services Committee on April 10, 2014, and to convey my concern about the apparently incomplete and incorrect nature of some of that testimony.
As you know, the Air Force--consistent with positions taken by the Government Accountability Office (GAO) and just about every other serious observer of the EELV program--has repeatedly acknowledged (1) that the program must move away from sole-sourcing rocket launches to the incumbent contractor and bring full-and-open competition into the program and (2) that such a change in EELV's contracting strategy could save billions of taxpayer dollars. For this reason, in November 2012, Under Secretary of Defense for Acquisition, Technology and Logistics Frank Kendall directed the Air Force to "aggressively introduce a competitive procurement environment in the EELV program . . . [to] obtain the positive effects of competition as quickly as possible". In furtherance of that directive, Under Secretary Kendall instructed the Air Force to purchase up to 36 rocket cores from the incumbent on a sole-source basis and up to 14 cores through a competitive process, from FY 2015-2017.
While, in December 2013, the Air Force indeed entered into a block-buy contract for the purchase of 36 rocket cores on a sole-source basis with the incumbent, it is now proposing to cut that number in half the number of launches that were originally designated for competition.
At the April 10 hearing, several Members, including me, conveyed serious concerns about the Air Force's proposal and its evidencing a lack of commitment to competition in this program. You attempted to explain the rationale for the proposal by noting that the 36-core block buy contract "tend[ed] to be for the heavier launches" and that "[no potential new entrant has] qualified [to launch heavier rockets] through the process yet."
However, the reasons you cite for the block-buy contract and the lack of competition for those 36 launches appear to be specious for two reasons. First, to date, the Air Force has not announced missions to be flown on the 36 cores purchased in the block-buy. Therefore, the claim that the launches are "heavier" seems unfounded. Second, while no potential prospective bidder has been certified as a new entrant, at least one potential new entrant has qualified to bid for the balance of launches. According to Under Secretary Kendall, in a January 24, 2013, letter to GAO, "The Department [of Defense] will allow new entrants to compete for launch contract awards as soon as the new entrant delivers the data from their final certification launch [emphasis added]." While formal certification may require the Air Force's full review of a new entrant's data, its submitting data after its final qualifying launch is all that is needed to allow it to compete for launch contracts. So, your assertion that no new entrant is qualified to perform "heavier" launches is misleading and possibly false.
Given the importance of the EELV program to ensuring national security, the size of the program, and the need for competition to bring--and keep--EELV's costs down, the necessity for a clear and accurate public record describing the Air Force's current proposal on this program, and the rationale for that proposal, is as imperative as it is self-evident. With this in mind, I expect timely responses to my inquiries about that proposal, including your answers to the questions posed in the letter I sent to you on March 25, 2014, before the upcoming mark-up of the National Defense Authorization Act for Fiscal Year 2015. Further, I invite you to clarify your testimony from the April 10 hearing, particularly on the issue of whether the Air Force has actually assigned missions to the 36-core block-buy at this point.
Thank you for your attention to this important matter. If you have any questions or concerns, please have your staff contact Jack Thorlin, Counsel to the Minority, Permanent Subcommittee on Investigations, at (202) 224-XXXX.
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