Pentagon Contracting Surged Before Shutdown

Pentagon Contracting Surged Before Shutdown

The U.S. Defense Department awarded several hundred contracts last month in a fiscal year-end surge of activity as officials raced to ink deals before the government shutdown.

The Pentagon in September announced almost 730 awards potentially worth about $47 billion, according to a Military​.com analysis of the Pentagon’s daily contract announcements.

The value doesn’t include tens of billions of dollars in previously announced Army alternative-energy contracts, or reflect what is actually spent, or obligated, because many deals are only partially funded at first.


Regardless, the quantity alone more than doubled from the previous month. While contracting usually peaks in September — the final month of the government’s fiscal year — the activity was likely fueled this year by a desire to finalize agreements before the shutdown.

A dozen companies, including Lockheed Martin Corp. and General Dynamics Corp., shared the Pentagon’s biggest contract last month, a potentially $4.1 billion deal with the Army for unspecified “communications and transmissions systems,” according to the Sept. 26 announcement. Army Contracting Command at Rock Island Arsenal, Ill., is overseeing the work.

Lockheed, the world’s largest defense contractor, also landed the second– and third-largest military deals in September.

The Bethesda, Md., based company won a $3.9 billion contract from the Missile Defense Agency to build Terminal High Altitude Area Defense, or THAAD, interceptors for the U.S. government and the United Arab Emirates under the Foreign Military Sales program, according to the Sept. 20 announcement.

In such a sale, the U.S. buys weapons or equipment on behalf of a foreign government. Countries approved to participate in the program may obtain military hardware or services by using their own funding or money provided through U.S.-sponsored assistance programs, according to the Defense Security Cooperation Agency.

September_contracting_graphic

Lockheed also received a $3.4 billion Navy contract to build 35 more F-35 fighter jets, according to the Sept. 27 announcement. The agreement was finalized as part of talks covering both the sixth and seventh batches of aircraft, excluding engines.

The seventh batch, or lot, of aircraft calls for 24 F-35As at $98 million a jet; seven F-35Bs at $104 million a jet; and four F-35Cs for the Navy at $116 million a jet, according to information the Pentagon released last month.

Of the two dozen conventional take-off and landing F-35A aircraft, the U.S. Air Force will receive 19, Italy will get three and Norway will take two, according to the contract announcement. Of the seven short take-off and vertical landing F-35B aircraft, the U.S. Marine Corps will receive six and the United Kingdom will get one.

The F-35 Joint Strike Fighter is the U.S. military’s most expensive weapons acquisition program, estimated at $391 billion to develop and buy 2,457 of the fifth-generation, radar-evading fighter jets.

Engine-maker Pratt & Whitney, part of Hartford, Conn.-based United Technologies Corp., won the fourth-largest defense contract last month, a potentially $2.5 billion deal with the Defense Logistics Agency “for various weapons systems spare parts,” according to the Sept. 30 announcement.

The MITRE Corp., based in Bedford, Mass., was the only other recipient in September of a contract valued at more than $1 billion. The nonprofit organization, which manages federal research and development centers, was awarded a $1.7 billion information-technology contract from the Air Force.

The deal covers everything from system engineering to architecture development and include sales to almost two dozen countries, including Saudi Arabia, Pakistan, Jordan, Taiwan, Columbia, Turkey, Kyrgz Republic, Poland, Hungary, Greece, Singapore, United Arab Emirates and Morocco, according to the Sept. 27 announcement.

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In other words, DoD spent almost $50BILLION right before the FedGov shut-down circus started…
Just another Repubtard & Demoncrat dog-and-pony show, with Obama and Boehner as ringleaders…
Maybe we can get some of those DEEP-POCKET FAT CATS to fund our Veterans during the clampdown…
How soon will martial law, or the next false-flag “terror attack” occur…???…

—“The seventh batch, or lot, of aircraft calls for 24 F-35As at $98 million a jet; seven F-35Bs at $104 million a jet; and four F-35Cs for the Navy at $116 million a jet, according to information the Pentagon released last month.”—

That is not the unit cost. That is only for those contracts. It does not included long-lead and other associated contracts. The price scenario for LRIP-6 and 7 is similar to this LRIP-5 scenario shown. I say “similar” with the difference being improvements in LRIP-6 and 7 on who carries the cost for defects. http://​www​.defense​-aerospace​.com/​a​r​t​i​c​l​e​-​v​i​e​w​/​fea

It is typical for the DOD to issue a flood of contracts in September. The contracting offices really cannot do their jobs in a timely manner, so it all piles up until the end, and then they make mistakes.

This year had two issues in addition to the normal year end. Sequestration and the CR (instead of an appropriations bill, like it should be). Three quarters the way through the FY, and some DOD offices had only spent 40% of the money they had because of those two issues. For expiring funds, it has to be obligated by Sept 30. Still, it seems like an awful lot of money disappeared this past year.

What shutdown? We’ve got money…don’t you?

Sorry, “blight_”, but the onliest moneys I GOT, is what’s left from my disability check…but hey, I live in America…
WHAT, ME WORRY…???…
It’s all *FUNNY*MONEY*, anyways, until they AUDIT the FED…
(…and REMEMBER, “Joe”, on Monday, Sept. 10, 2001, the first report on the MISSING $2TRILLION+, in Pentagon funds, was released…-BUT-, the NEXT day…a little “coincidence” occurred…Like I said, it’s ALL *funny*money*…

this is what happens at the end of fiscal year„,our govt hav “unspent money”„,then scrambles to spend it„,or they will not receive the same budget for upcoming year„„I know„,I have been there…

…yeah, but when they “spend” it, SOMEbody GETS it…So, *WHO* has this money NOW…???…
…it doesn’t just DISAPPEAR, when it is “spent”…

The money hasn’t been spent, its been obligated. They signed contracts for stuff, its end of the fiscal year.….get it obligated or loose it. They actually give it to someone once they provide a deliverable under the contract.

It all goes to Lockheed. Every other story here is about how Lockheed just locked down some multi-billion dollar contract.

Your reply is non-responsive and evasive, “Muttling”… *WHERE* *IS* the money that is now subject to this future “obligation”…???…In the future, when that money is “spent”, *WHERE* will it go, and where will it *BE*, *THEN*…???…Based on what you’re saying, “money” can take the form of a “contract”, isn’t that correct…???…So, in REALITY, a FRN is an IOU, correct…???…
So, America’s currency is actually DEBT NOTES, right…???…

According to the current Air Force exhibits, the F-35A airframe was projected to cost $76 million, the avionics $25 million, and the engine $15 million. That’s $116 million a copy. The airframe contract was scheduled to award in June. So, the real problem with awarding a September contract is that it disguises a 3-month delay, which then overlaps with the following year’s schedule. Do this a few times and you’ve hidden a major program delay.

Plus, while the company is building a backlog (good for them, not good for the taxpayer), there is no adjustment on the government’s cash flow. That is, if the September 2013 contracts basically spend out over the FY 2014 time period, an adjustment could be made to bring the schedule back online, savings the taxpayers that $67 billion, rather than showing that all these programs are executing later than planned. $67 billion is more than enough to cover the Pentagon’s $50 billion cut for the next round of sequestration.

He’s saying that the government obligates (sets aside, creating a government liability) an amount it expects to pay for a good or service. That set aside is paid off when a contractor makes a delivery or provides a service and then bills the government. When he is paid, the obligation is liquidated. Obligations take many forms. Military and civilian payrolls (including allowances), travel orders, PCS, contracts, requisitions, government credit cards, etc.

Take an ad out in the classified sections of the newspapers, some DEEP-POCKETS FAT CATS are bound to respond.

You are correct, as far as that goes, “Taxpayer”, and I thank you for the info.…But you still don’t “get it”…you don’t understand the point I’m making…
I’m NOT trying to argue here…BUT, what about the non-Gov’t “Federal Reserve” Bank…???…
Isn’t ALL our money “funny money”…???…
My Dad used to remind me that “money doesn’t grow on trees, Bradford…“
And I reminded him, that “it’s made on printing presses, Dad”…
If we need more money, we just PRINT MORE, after we BORROW MORE, from the Fed…
Hey, as long as we have “growth”, the Ponzi scheme known as the “economy” keeps growing…
But why should a few super-rich investors and corporate bosses, and Wall Street, keep getting an ever-larger share of the pie, when workers are losing jobs and homes on Main St.…???…

Good idea, “robertabbott”. What should I write in this ad you suggest?
I assume you speak “DEEP-POCKETS FAT CAT” better than I ever will…

Funny, Brad. I used to tell my mom the same thing about the printing press. The only reason the US is still afloat is that everyone GIVES us their extra money because the American dollar is the “reserve currency” and they stupidly believe they’re going to get paid back. But with the dollar declining 20% over the last five years, they have actually lost 4% per year by doing that.

We can only get our jobs and economy back IF we stop shopping at WalMart. But since Americans would rather have cheap goods than a job, it’s probably a lost cause. Except for the few electronic made by defense companies for the Pentagon, there is not a single electronics manufacturing of any size in the US anymore. Companies like Apple — that American’s have made rich — exported all our job years ago. The big boys like GE, Ford, GM, Boeing, now make more than half their money selling overseas. Who’s flag do they support?

How about all the contract mods for config. changes? The award contract is just the beginning.

To all those on this string that know nothing about this article but decided to provide comments just the same, take a course in government accounting and government contracting if you don’t understand and keep your inept stupid thoughts to yourself until you do understand. To Taxpayer and ELP, admiral attempt in trying to help stupid become educated.

To the idiot that wrote the article, great job at taking open source information and twisting it into an article that completely misinformed the public. Contracting in Sept of any fiscal year has absolutely nothing to due with the future fiscal year. Decisions aren’t suddenly made in Sept to contract for weapons systems (Aircraft, ships, etc) these decisions were made months if not years before, to your statement regarding lots. That contract has been in place for years. What do you think occurs during a continuing resolution ? Why didn’t you reference a continuing resolution in this article instead of a shutdown, since a continuing resolution has been the normal mode of operations for the past 10 + years? Behavior and decisions made during a continuing resolution impact and effect the remaining fiscal year, and possibly the future years. Why didn’t you compare the amount and number of contracts awarded a year ago in Sept? If you really wanted a relative reference for DoD spending. Wouldn’t have made such a sensational story now would it?

There are these little know facts, called Fiscal Law, Appropriation Law, and the Federal acquisition regulations (FAR) the govern contracting. Maybe you should learn about the. Before trying to write an article about something you obviously no nothing about.

For DoD Buzz editors — you should be ashamed for publishing this type of blanant misinformation to your readers.

Nice try, “DoD-FM”, but, NO CIGAR…your own brand of mis-, and dis-information really adds little to the discussion, and you lose credibility points because you didn’t PROOF-read your comment BEFORE you clicked the “submit comment” button. You should know as well as the rest of us here, that the FedGov Budget is largely SMOKE-and-MIRRORS. The “Sequester”, –AND– the “FedGov Shutdown” are simply more D.C. Dog-and-Pony Shows. BOTH Repubtards and Demo-crackers PLAY that GAME with the Taxpayers money. The real WASTE, FRAUD, and ABUSE in the FedGov budget *IS* “defense spending”, much of which is a pointless jobs-and-spending SCAM which contributes little or nothing to National Defense. And, which too often simply further bulges the bloated bank accounts of Fat Cat CEO’s and investors. Again, which does little or nothing to contribute to National Defense. Tell us, again, which Branch of Gov’t *IS* the “Federal Reserve”…???…Is it Judicial, Legislative, or Executive…???… Isn’t the TRUTH that the Fed was created by a cabal of Global Banksters, 100 years ago, at Jekyll Island, GA., and that it “creates” “money” literally out of thin air?… TELL THE TRUTH, “DoD-FM”, IF YOU DARE…
(…and please keep posting, “Taxpayer”, and “ELP”, I, for one, enjoy reading your comments…

I didn’t know the Pentagon had an EBT card too. I guess I shouldn’t be surprised that the Pentagon should act just like any other group of government sponges. After all, they are just as “entitled” to our money as every other loser and victim in this nation, why shouldn’t they behave just the same?

The unit prices under Foreign Military Sales were prenegotiated to exclude the over-runs. The risks are placed on DOD. Thus the taxpayer gets screwed once again.

I just hope that with all of the cash that the pentagon was sitting on, they used some of it to purchase tools for my sons shop so he can help keep those fighters flying!

Well, get used to it! The entitlists are continuing to drop out of the workforce and the administration just put the screws to the taxpayers again. When you have more people reaping our tax dollars than you have contributing, collapse is immenent. You can’t stop it now!

Yeah, dude, I’d rather sit on my backsides, and collect $700.month Social Security Disability, get $200.month in EBT Food Stamps, and free drugs from Obamacare, than pull in $70. — $100K+ /year, doing REAL WORK…
Actually, it’s the Flush Limpbaugh Repubtards like YOU that are America’s REAL PROBLEM…“Get a clue, morans”…BOTH PARTIES are screwing you over, grandpa, but you’re 1/2 BLIND…
Yeah, kiddo, I just deposit my whole monthly Disability check in my secret Swiss bank account, and never spend a penny of it…How STOOPID are you fat cats…???…You probly don’t want the Fed to be audited, do ya…???…

When popular culture makes it “cool” to be on welfare, then we have a problem. Luckily, our social conditioning systems ensure people who are poor are made to feel ashamed of themselves (which is why we hate on them). The system is working as intended.

I guess if you really wanted to kill those welfare rolls, you could publish a list of people on the public dole. Go with a Leaderboard of Using Most Services. If the leaderboard is single moms fleeing abusive husbands, perhaps you’d feel a little less jaded about the safety net. But if it’s full of men using their family’s SNAP to buy beer, then they need a good public flogging.

Thank-you, “blight_”, you’re on the right track…The talking heads — both “conservative” AND “liberal”, always over-simplify this issue, and argue, rather than explain… Some of us are retired, some truly disabled, some are on actual “welfare”. That “47 million” figure, who “don’t pay taxes”, according to turds like Flush Limpaugh, are largely retired, and disabled, and MOST of them are living on less than minimum wage. It would actually cost more to collect the taxes, than the taxes themselves would pay. But the Repubtards can’t see that… Too many “SNAP”/EBT/food stamps DO go to beer, cigs, etc… But, BUT, in all these cases,
the MOST WASTE, FRAUD, and ABUSE, is from the Gov’t employees of these programs. That, and the outright FRAUDSTERS.…There’s no easy answers, but idiots like “Sandratpa”, above, and their IGNORANCE, are more part of the problem, than the solution. And, from what I see, “Obamacare” will NOT make anything better, that simply expanding Medicare & Medicaid would.

He needs a cost-plus contract.

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