F-35 Alternate Engine Program:
Background and Issues for Congress
Jeremiah Gertler
Specialist in Military Aviation
January 10, 2011
Congressional Research Service
7-5700
www.crs.gov
R41131
CRS Report for Congress
P
repared for Members and Committees of Congress
F-35 Alternate Engine Program: Background and Issues for Congress
Summary
For four successive years, Congress has rejected administration proposals to terminate the
program to develop the General Electric/Rolls-Royce F136 engine as an alternative to the Pratt &
Whitney F135 engine that currently powers the F-35 Joint Strike Fighter (JSF). The
administration’s FY2011 budget submission again proposes to terminate the program.
The alternate engine program began in FY1996, when defense authorization conferees directed
DOD to ensure that the JSF (then “JAST”) program “provides for adequate engine competition.”
Through FY2009, Congress has provided approximately $2.5 billion for the Joint Strike Fighter
alternate engine program. The program is projected to need an additional $1.9-2.9 billion through
2016 to complete the development of the F136 engine.
Critics of the proposal to terminate the F136 alternate engine argue that termination was driven
more by immediate budget pressures on the department than the long-term pros and cons of the
F136 program. They argue that engine competition for the F-15 and F-16 saved money and
resulted in greater reliability. Some who applaud the proposed termination say that single-source
engine production has been the norm, not the exception. Long-term engine affordability, they
claim, is best achieved by procuring engines through multiyear contracts from a single source.
Canceling the F136 engine poses questions on the operational risk—particularly of fleet
grounding—posed by having a single engine design and supplier. Additional issues include the
potential impact this termination might have on the U.S. defense industrial base and on U.S.
relations with key allied countries involved in the alternate engine program. Finally, eliminating
competitive market forces for DOD business worth billions of dollars may concern those seeking
efficiency from DOD’s acquisition system and raises the challenge of cost control in a single-
supplier environment.
Continuing F136 development raises issues of impact on the F-35 acquisition program, including
possible reduction of the numbers of F-35s that could be acquired if program funds are used for
the alternate engine. It also raises issues of the outyear costs and operational concerns stemming
from the requirement to support two different engines in the field.
FY2011 defense authorization bill: In markup on May 19, 2010, the House Armed Services
Committee added $485 million to continue the alternate engine program, and passed language
that would limit F-35 procurement to 30 aircraft and prohibit DOD from spending 25% of its F-
35 budget until all alternate engine funds had been obligated. On May 27, 2010, the House voted
to defeat an amendment that would have eliminated funding for the alternate engine. The version
of the authorization report reported by the Senate Armed Services Committee does not include
such funding.
As passed, H.R. 6523, the Ike Skelton National Defense Authorization Act For Fiscal Year 2011,
did not include program-level detail, so there is no amount specified for the F-35 alternate engine
(nor, for that matter, the F-35 itself.)
FY2011 DOD appropriations bill: The House Defense Appropriations Subcommittee report
included $450 million for the F-35 alternate engine. The Senate Appropriations Committee-
reported version of the bill, released September 16, 2010, included no such funding. In lieu of a
defense appropriations bill, the Congress approved a resolution continuing FY2010 spending
levels.
Congressional Research Service
F-35 Alternate Engine Program: Background and Issues for Congress
Contents
Introduction ................................................................................................................................ 1
Background ................................................................................................................................ 1
Summary of Arguments ........................................................................................................ 2
Frequently Asked Questions ........................................................................................................ 3
Current Status of the Alternate Engine Program........................................................................... 4
Funding Status Under Continuing Resolution ........................................................................ 5
Administration Perspectives .................................................................................................. 5
Secretary of Defense ....................................................................................................... 5
Secretary of the Air Force ............................................................................................... 6
Air Force Chief of Staff................................................................................................... 6
Chief of Naval Operations............................................................................................... 6
Vice-Chairman of the Joint Chiefs of Staff ...................................................................... 7
Office of Management and Budget .................................................................................. 7
GAO Perspective .................................................................................................................. 7
Cost Issues............................................................................................................................ 8
Independent Cost Analyses of the F-35 Alternate Engine ................................................. 9
Size of F-35 Engine Production Run ............................................................................. 11
Contractor Offers of Fixed-Price Contracts.................................................................... 12
Relations with Allies ........................................................................................................... 12
Engine Development Issues ................................................................................................ 13
Testing Incidents ........................................................................................................... 13
Reported F135 Quality-Control Issues........................................................................... 14
Engine Performance...................................................................................................... 15
Issues for Congress ................................................................................................................... 15
How the Alternate Engine Program Should be Funded......................................................... 15
Credibility of Cost Estimates Showing Little Difference Between the Cost of One
Engine Program and the Cost of Two ............................................................................... 15
Controls to Curb Cost Growth Absent Competition ............................................................. 16
Importance of the Potential Fleet-Grounding Issue Attributed to Procuring a Single
Engine ............................................................................................................................. 16
The Operational and Logistical Impacts of Supporting Two Engines.................................... 17
Impacts on the Military Turbine Industrial Base of Procuring One Engine Rather than
Two ................................................................................................................................. 17
FY2011 Legislative Actions ...................................................................................................... 19
FY2011 Defense Authorization Act (H.R. 5136).................................................................. 19
House ........................................................................................................................... 19
Senate ........................................................................................................................... 24
Final Action .................................................................................................................. 25
FY2011 Defense Appropriations Act ................................................................................... 26
House ........................................................................................................................... 26
Senate ........................................................................................................................... 26
Final Action .................................................................................................................. 26
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F-35 Alternate Engine Program: Background and Issues for Congress
Tables
Table 1. Summary of Cost Analysis Results................................................................................. 9
Table B-1. “Great Engine War” Procurement Quantities ............................................................ 60
Appendixes
Appendix A. Prior-Year Legislative Activity.............................................................................. 27
Appendix B. The “Great Engine War” of 1984-1994 ................................................................. 59
Contacts
Author Contact Information ...................................................................................................... 60
Acknowledgments .................................................................................................................... 60
Congressional Research Service
F-35 Alternate Engine Program: Background and Issues for Congress
Introduction
The administration’s proposal to terminate the alternate engine program for the F-35 Lightning II
fighter is a significant issue for Congress in FY2012, with implications for the defense budget,
military capability in the future, and the division of power between Congress and the executive
branch.
The program is developing the General Electric/Rolls-Royce F136 engine as an alternative to the
Pratt & Whitney F135 engine that currently powers the F-35. Successive administrations
proposed terminating the alternate engine program in the FY2007 through FY2010 budgets.
Congress rejected these proposals and provided funding, bill language, and report language
continuing the program. The administration’s FY2011 budget submission again proposed to
terminate the program.
Background
On October 26, 2001, the Department of Defense (DOD) selected the single-engine Lockheed
Martin F-35, powered by the Pratt & Whitney F135 engine, as the winner of its Joint Strike
Fighter (JSF) competition. DOD expects to buy 2,456 JSFs for the Air Force, Navy, and Marine
Corps.1
In FY1996, Congress required development of an alternate engine for the F-35.2 This became the
F136, based on an engine created by the team of General Electric and Rolls-Royce for the
unsuccessful McDonnell Douglas JSF candidate. The F135 and F136 engines were designed to be
used interchangeably, without modification to the F-35 airframe.
In FY2007, the administration proposed terminating the alternate engine program “because
development of the main engine was progressing well and analysis indicated that savings from
competition would not be offset by high upfront costs.” 3 Congress subsequently restored funding
for the program, along with directive bill and report language requiring DOD to continue the
program in future years. Administration-proposed terminations in FY2008, FY2009, and FY2010
were also rejected by Congress.
The administration’s proposed FY2011 budget would again end the alternate engine program.
1 In-depth discussion of other issues associated with the JSF program can be found in CRS Report RL30563, F-35 Joint
Strike Fighter (JSF) Program: Background and Issues for Congress.
2 In FY1996, defense authorization conferees expressed their concern over a lack of engine competition in the JAST
(later re-named JSF) program and directed DOD to ensure that the program “provides for adequate engine competition”
(H.Rept. 104-450, Sec. 213, p. 706.) In FY1998, authorization conferees directed DOD to certify that “the Joint Strike
Fighter Program contains sufficient funding to carry out an alternate engine development program that includes flight
qualification of an alternate engine in a joint strike fighter airframe” (H.Rept. 105-340, Sec. 213, p. 33).
3 Office of Management and Budget, Terminations, Reductions, and Savings, Budget of the U.S. Government, Fiscal
Year 2010, Washington, May 2009, p. 38.
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F-35 Alternate Engine Program: Background and Issues for Congress
Summary of Arguments
Supporters of the administration’s proposal to terminate the alternate engine program argue the
following:
• Developing and procuring a second engine for the F-35 would add billions of
dollars to the cost of the F-35 program by roughly doubling engine development
costs and halving engine production economies of scale. Such a cost increase
would reduce the number of F-35s that could be procured within a given total
amount of F-35 acquisition funding, forcing cuts in future capabilities and force
structure. An official from the F-35 program office stated that the reduction in F-
35 procurement over the next five years might total 50 to 80 aircraft.4
• Procuring a second engine would increase F-35 life-cycle operation and support
(O&S) costs by requiring DOD to maintain two engine maintenance and repair
pipelines. Supporting two engines on aircraft carriers would be particularly
challenging due to limited space and facilities.
• Having a second engine is not needed to sustain international interest in the F-35,
because the most significant potential foreign buyers are already committed to
the F-35 program, and because committed and potential buyers already have
several significant reasons to be interested in the F-35, starting with the aircraft’s
capabilities, procurement cost, and operating and support cost.
• Congress already accepts the risk of using single designs across fleets, both in
powerplants and airframes. Many other aircraft types in the U.S. inventory use
one engine design across the fleet. Procurement of a single airframe design also
carries the risk of fleet grounding if there is a flaw in the design (as has occurred
in the past),5 yet those risks are acceptable to Congress and DOD. The same risk
logic should apply to F-35 engines.
• Development, testing, and production of the F135 have reached the point where it
is no longer necessary to hedge against the possibility of technical problems in
the F135 engine by pursuing an alternate engine program as a backup. The causes
of F135 test failures in 2007 and 2008 have been identified and fixes are being
implemented.
Opponents of the administration’s proposal to terminate the alternate engine program argue the
following:
• The administration’s proposal to terminate the alternate engine program does not
comply with Section 213 of the FY2008 defense authorization act (H.R.
4 Graham Warwick and Guy Norris, “Second Engine Could Force F-35 Production Cuts, PEO Warns,” Aerospace
Daily & Defense Report, June 1, 2009, p. 3.
5 For example, the Air Force grounded all of its F-15 aircraft on November 3, 2007, following midair structural failure
of an F-15C. The fleet was returned to service on November 21, 2007. (“Entire F-15 Fleet Returning to Flight”, Air
Combat Command News Service, November 21, 2007.) All C-5A aircraft were grounded in January, 1970, due to
cracks discovered in the wings, and again in October, 1971, following the discovery of cracks in engine mounts.
(Darrell Garwood, “Newest Air Force Planes Grounded,” UPI, January 17, 1970, and Richard Witkin, “Entire C-5A
Fleet Grounded By U.S”, The New York Times, October 13, 1971.) On a smaller scale, see Philip Ewing, “104 Hornets
grounded after cracks discovered,” NavyTimes.com, March 14, 2010.
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F-35 Alternate Engine Program: Background and Issues for Congress
4986/P.L. 110-181 of January 28, 2008), which states: “Of the funds appropriated
pursuant to an authorization of appropriations or otherwise made available for
fiscal year 2008 or any year thereafter, for research, development, test, and
evaluation and procurement for the Joint Strike Fighter Program, the Secretary of
Defense shall ensure the obligation and expenditure in each such fiscal year of
sufficient annual amounts for the continued development and procurement of 2
options for the propulsion system for the Joint Strike Fighter in order to ensure
the development and competitive production for the propulsion system for the
Joint Strike Fighter.”
• Given that F-35s are to constitute the vast majority of the country’s strike
fighters, it would be imprudent to have all those strike fighters powered by a
single type of engine, since a problem with that engine could force the grounding
of the entire F-35 fleet.
• Having a second engine in production (or ready for production) would permit
DOD to use competition (or the threat of competition) in procuring and
supporting F-35 engines, which could reduce F-35 engine procurement and O&S
costs compared to what would be achievable in a sole-source procurement,
offsetting the additional costs associated with developing, procuring, and
supporting a second engine.
• Competition (or the threat of competition) would also promote better engine
performance, increased engine reliability, and improved contractor
responsiveness. Having two F-35 engine production lines in operation would also
permit F-35 engine production to be more quickly surged to higher levels if
needed to respond to a change in the strategic environment, and preserve a
potential for maintaining effective competition in the development and
procurement of future tactical aircraft engines, particularly if F-22 and F/A-
18E/F production ends.
• Having a second engine in production would help sustain international interest in
the F-35 program, maximizing F-35 exports. Potential foreign buyers would be
more inclined to purchase the F-35 if they had a choice regarding the aircraft’s
engine, and if they believed that competition (or the threat of competition) in
engine production was holding down the engine portion of the F-35’s total cost.
Frequently Asked Questions
These are the most common questions received by CRS concerning the F-35 alternate engine
program:
Has DOD always opposed the alternate engine
No. From FY1996 to FY2006, funding for an alternate engine
program?
was included in the Administration budget request. Starting in
FY2007, both the G.W. Bush and Obama Administrations
deleted this request.
Was there an earlier competition for F-35 engines
No. Three aircraft companies bid to design and build the F-
that one contractor won?
35. One design used the GE/Rolls-Royce engine; two used the
Pratt & Whitney engine. The two aircraft chosen as finalists
both used the Pratt & Whitney engine. There was no
separate engine competition.
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F-35 Alternate Engine Program: Background and Issues for Congress
Is this about replacing the existing engine supplier?
No. The issue is whether to underwrite development of a
second engine to the point where a competition for
production engines can be held. The estimated cost to do so
ranges from $2 billion-$3 billion.
Will F-35 engine competition save money?
Studies disagree. DOD, the Institute for Defense Analyses,
and the GAO have done separate studies of potential F-35
engine competitions. DOD and IDA found that competition
would not save enough to repay the initial investment; GAO
found that it would. Al studies found non-monetary benefits
to the competition.
Will the competition be winner-take all?
The rules for the competition(s) have not been established. In
the 1985-1990 competition for F-15/F-16 engines, engine
contracts were awarded in annual lots. Although annual ratios
differed markedly, overall one contractor won 51% and the
other 49%.
Do other military jets have multiple engine
Yes. The F-16C/D fleet includes engines from different
suppliers?
suppliers. All other US jet models use single engine types and
suppliers.
What is the chance that all F-35s will be grounded if
It is impossible to state. Historical y, with the F-14, F-15, and
they have the same engine?
F-16, significant engine issues were discovered early in
development, leaving time for the issues to be addressed
through technical fixes, competitions, and/or wholesale
replacement by another engine. No such issue has yet
surfaced for the F-35. It is possible that a serious flaw could
remain undiscovered until much later, when a significant
portion of the F-35 fleet shared a common engine. There is
no way to calculate the probability of this.
Current Status of the Alternate Engine Program
Pratt & Whitney, the incumbent engine maker, received a total of $7.3 billion in funding during
the period FY1994-FY2009 for work relating to the F-35 program. This figure included funding
for work performed for the Boeing concept for the JSF (a concept that was not selected to go
forward.) The $7.3 billion also includes $6.1 billion received during the period FY2002-FY2009
for F135 System Development and Demonstration (SDD) work. The estimated cost of the F135
SDD contract increased from $4.8 billion at contract award in 2001 to $6.7 billion as of
September 2009. Approximately $0.8 billion of the increase is cost growth; the remaining $1.1
billion or so reflects an increase in the scope of work to be performed.
The General Electric/Rolls-Royce alternate engine team received a total of $2.4 billion during the
period FY1995-FY2009. This total includes $1.7 billion for SDD work for the F136 engine
during the period FY2005-FY2009. The F136 team’s effort did not include design, development,
test, or delivery of STOVL Lift System components and exhaust systems, which were developed
and provided under the F135 Pratt & Whitney SDD contract. The F136 SDD contract
consequently included fewer test hours and fewer ground test engines.6
A discussion of technical issues follows in the “Engine Development Issues” section of the report,
below.
6 DOD information paper on F-35 program dated September 24, 2009, provided to CRS by Air Force Legislative
Liaison Office on September 29, 2009.
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F-35 Alternate Engine Program: Background and Issues for Congress
Funding Status Under Continuing Resolution
In light of the Administration’s stated opposition to further funding of the alternate engine
program, some members of Congress have questioned the status of the program during the period
of a continuing resolution (CR). Press reports indicate that “even though funding is in place to
continue developing the engine for two more months, (Defense Secretary) Gates could go as far
as to impound funding for the program.”7
CRs prohibit spending on new starts or on procurement rates above FY2010 levels. P.L. 111-242,
the CR effective through March 4, 2011, sets DOD spending at a “rate of operations” consistent
with the FY2010 DOD Appropriations Act (P.L. 111-118) for the base budget, the FY2010
Omnibus for military construction levels set in P.L. 111-117 with reductions for BRAC funding
not requested in FY2011, plus war funding provided in Title IX of the FY2010 DOD
Appropriations Act and in the FY2010 Supplemental (P.L. 111-212).8
In a letter, Office of Management and Budget Director Jacob Lew stated that “DoD would be
expected to continue funding activities on a pro-rata basis during the period covered by the CR,
so as not to impinge on Congress’ full-year funding prerogatives for FY 2011.”9
Administration Perspectives
Secretary of Defense
At a February 3, 2010, hearing, Secretary of Defense Robert Gates testified:
I would just say, you know, from our standpoint, the Congress has added $1.8 billion for this
program. We see it costing us another $2.9 billion over the next five years….
The reality is, the most optimistic analyses and models that we have run show that there is
little advantage to the taxpayer of having a second engine. The truth is, almost none of the
customers will buy two engines. If there’s a European engine or a Rolls-Royce GE engine,
the Europeans are probably going to buy—our European partners are probably going to buy
that one. The Marine Corps and the Navy have both said they’re only going to take one
airplane, because of the limited logistics, space available on ships.
So, the only piece of this that could be competed would be the Air Force part of it. And so,
you end up having two engines for the Air Force.
Look, the key is getting the F135 engine program. It’s doing well. It’s completed 13,000
hours of testing out of 14,700. The F136 has completed 50 hours of testing. There’s no
reason to believe that the second engine won’t encounter the same development problems the
first one has.10
7 Emelie Rutherford, “Pentagon Expected To Announce Plans For Disputed F-35 Engine,” Defense Daily, January 4,
2011.
8 The author is indebted to Amy Belasco, CRS Specialist in U.S. Defense Policy and Budget, for this discussion.
9 Letter from Jacob J. Lew, Director, Office of Management and Budget, to Senator Sherrod Brown, December 21,
2010.
10 Transcript of House Armed Services Committee hearing on Fiscal 2011 budget request for the Defense Department,
(continued...)
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F-35 Alternate Engine Program: Background and Issues for Congress
Secretary of the Air Force
At a February 23, 2010, hearing, Secretary of the Air Force Michael Donley stated:
It is a close enough call that we cannot see right now the benefits of a considerable—what
we think is still a considerable remaining investment that would have to be made in a second
engine, the logistics tail that goes with it, all the pre-production work, the remaining
development, which may be understated in some quarters; the firm costs that are associated
with those activities against the soft savings that might be out there in the future. We’re
just—it just looks too cloudy to us.11
Air Force Chief of Staff
At the same hearing, in response to a question as to why the F-35 should not have an alternate
engine when the F-15 and F-16 did, Air Force Chief of Staff General Norton Schwartz testified:
Because we’re 20 years, 30 years later in technological progress on engine design and
production. And fundamentally … if having more engines results in less F-35s, that is not a
good scenario for the Air Force or the Department of Defense.
Secondly, the reality is that the F-22 and the F-18E/F are single-engine airplanes.12 And, you
know, there’s no dispute about that, and it’s because we collectively in the defense
community, I think, have become comfortable with the reliability and so on of those
respective engines, one of which is a predecessor to the 135.13
General Schwartz commented on funding for the alternate engine on October 12, 2010:
“If Rolls and GE are so confident that their product will succeed and bring value to the
taxpayer, it would be nice if they put a little more against that $1.9 billion bill that they’d like
the taxpayer to undertake,” Schwartz said.14
Chief of Naval Operations
Chief of Naval Operations Adm. Gary Roughead was quoted in a press report as saying, “I’m in
the one engine camp.… On a carrier, space matters.”15
(...continued)
February 3, 2010.
11 Transcript of House Armed Services Committee hearing on Fiscal 2011 budget request for the Department of the Air
Force, February 23, 2010.
12 General Schwartz’s reference to “single-engine airplanes” meant that the aircraft in question used only a single
engine design from a single supplier, not that only one engine was installed in each airplane.
13 Ibid.
14 Marina Malenic, “Air Force Chief: GE, Rolls Should Cover More F136 Development Costs,” Defense Daily,
October 13, 2010.
15 Graham Warwick, “Navy Backs Single JSF Engine As F-35C Rolls Out,” Aerospace Daily & Defense Report, July
29, 2009, pp. 1-2. See also Antonie Boessenkool, “Pratt & Whitney’s Costs Parts-Reject Rate Too High: JSF Official,”
Defense News, August 3, 2009.
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F-35 Alternate Engine Program: Background and Issues for Congress
Vice-Chairman of the Joint Chiefs of Staff
“For the [price of] the alternate engine on the Joint Strike Fighter, I could have 100 more
Predators, easily,” (Marine Corps Gen. James) Cartwright says, referencing the General
Atomics unmanned aerial system in high demand in Afghanistan. “Which would you buy?”16
Office of Management and Budget
An Office of Management and Budget (OMB) document on proposed FY2010 program
terminations, reductions, and savings stated that the Administration believed the alternative
engine program was “no longer needed as a hedge against the failure of the main Joint Strike
Fighter engine program,” and that “financial benefits, such as savings from competition, have
been assessed to be small, if they exist at all, because of the high cost of developing, producing
and maintaining a second engine.” OMB stated that cancellation “will result in estimated near-
term savings of over a billion dollars.”17
GAO Perspective
At a May 20, 2009, hearing before the Air and Land Forces subcommittee of the House Armed
Services Committee, GAO testified that “competitive pressures could yield enough savings to
offset the costs of competition over the JSF program’s life.”18
The GAO testimony reaffirmed previous GAO work, including an estimate that “to continue the
JSF alternate engine program, an additional investment of about $3.5 billion to $4.5 billion in
development and production-related costs, may be required,” and that “a savings of 9 to 11
percent would recoup that investment.”19 GAO went on to assert that “a competitive strategy has
the potential for savings equal to or exceeding that amount across the life cycle of the engine,”
noting that the “Great Engine War” of the 1980s resulted in “(1) nearly 30 percent cumulative
savings for acquisition costs, (2) roughly 16 percent cumulative savings for operations and
support costs; and (3) total savings of about 21 percent in overall life cycle costs.” (For more on
the “Great Engine War,” see Appendix B.)
GAO also noted that a number of nonfinancial benefits may result from competition, “including
better performance, increased reliability, and improved contractor responsiveness.”
16 Amy Butler, “In Tough Fiscal Times, Cartwright Says More Is Better,” Aerospace Daily, December 3, 2010.
17 Office of Management and Budget. Terminations, Reductions, and Savings, Budget of the U.S. Government, Fiscal
Year, 2010. Washington, May 2009. p. 38.
18 All GAO quotes in this section are from Government Accountability Office, Joint Strike Fighter[:]Strong Risk
Management Essential as Program Enters Most Challenging Phase, Statement of Michael Sullivan, Director
Acquisition and Sourcing Management. GAO-09-711T, May 20, 2009.
19 The earlier work cited in GAO’s testimony include Government Accountability Office, Joint Strike Fighter[:]
Impact of Recent Decisions on Program Risks, Statement of Michael Sullivan, Director Acquisition and Sourcing
Management, Testimony before the Subcommittees on Air and Land Forces, and Seapower and Expeditionary Forces,
Committee on Armed Services, House of Representatives, GAO-08-569T, March 11, 2008; and Government
Accountability Office, Defense Acquisitions[:]Analysis of Costs for the Joint Strike Fighter Engine Program,
Statement of Michael Sullivan, Director Acquisition and Sourcing Management, Testimony before the Subcommittees
on Air and Land Forces, and Seapower and Expeditionary Forces, Committee on Armed Services, House of
Representatives, GAO-07-656T, March 22, 2007.
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F-35 Alternate Engine Program: Background and Issues for Congress
Cost Issues
Cost has been a significant issue in the alternate engine debate. Proponents of the alternate engine
point to cost growth in the F135 as evidence that a competitor is needed to control costs. The
administration maintains that the benefits of a second engine do not outweigh its costs.
In July, 2009, Pratt & Whitney reported that the cost of an F135 had increased 24%, from $6.7
million apiece to $8.3 million.20 In response, Secretary Gates said:
There is always cost growth associated with a developmental aircraft. It’s one of the reasons
we have over $4 billion in the FY ’10 budget to reduce the program risk [by allowing] for
more engineers, more testing time, more airframes for testing. We think that fixing the
problems we’ve encountered ... with the engine is something that’s quite manageable. And
we don’t think it’s the best use of our money to fund a second engine.21
Also in July, 2009, DOD created a Joint Assessment Team (JAT) “to investigate and understand
Pratt & Whitney’s cost structure and help the JSF office in its assessment of the company’s latest
… bid. The JAT also will look at scrap rates and other production issues.” 22 According to
reporting on a memo from Under Secretary Ashton Carter, the JAT’s charter included
“understanding the production cost, cost drivers, cost projections and long-term affordability of
the F135” and developing “a plan to address F135 cost and affordability.”23
DOD has declined to give CRS access to the JAT results. A February 26, 2010, press report
indicated:
Adding a second engine to the F-35 Lightning II program would cost the same as hewing to
the single-source plan, according to a new Pentagon study. Defense Department officials say
that supports their decision to reject proposals to buy General Electric and Rolls-Royce’s
F136 engine.…
‘The estimated costs of a competitive engine acquisition strategy are projected to be
approximately equivalent to a sole-source scenario, or at the break-even point,’ reads a copy
of a Pentagon memo explaining the JSF ‘Alternate Engine Cost/Benefit Analysis’ that was
sent to lawmakers on Feb. 25.
The memo acknowledges that continued development work on the F136 has reduced the
amount of money it would take to bring the second engine online.
Yet the “fundamental conclusion remains the same: The potential lifecycle cost savings
from” two competing F-35 engine programs ‘do not provide a compelling business case,’
wrote Christine Fox, who directs Defense Department cost assessment and program
evaluation.24
20 Tony Capaccio, “F-35 Engine Shows ‘Fairly Significant’ Cost Growth,” Bloomberg.com, July 27, 2009.
21 “No Means No,” Aerospace Daily & Defense Report, August 24, 2009, p. 1. Ellipsis as in original.
22 Bill Sweetman, “Government Sends F135 Tiger Team Into Pratt & Whitney,” Aerospace Daily & Defense Report,
September 8, 2009, p. 3.
23 John T. Bennett, “Team Must Complete F135 Engine Review by Nov. 20,” DefenseNews.com, September 9, 2009.
24 John Reed, “Study: No Cost Difference for F-35 Alternate Engine,” DefenseNews.com, February 26, 2010.
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F-35 Alternate Engine Program: Background and Issues for Congress
Independent Cost Analyses of the F-35 Alternate Engine
Section 211 of the 2007 defense authorization act (H.R. 5122/P.L. 109-364 of October 17, 2006)
(see Appendix A for text) directed three independent cost analyses of the F-35 engine program.
The studies were conducted by the Cost Analysis Improvement Group (CAIG) within the Office
of the Secretary of Defense (OSD), the Institute for Defense Analyses (IDA), and GAO. The
studies used the same data (which were provided by the JSF program office and contractors), and
were completed in 2007.
The studies came to differing conclusions regarding the estimated financial break-even points for
an alternate engine program. The studies all cited non-financial benefits that would be derived
from an engine competition, including improvements in fleet readiness, contractor
responsiveness, sustainment of industrial base, and stronger international relations.
Table 1. Summary of Cost Analysis Results
Savings required to break even
Savings from past competitions
CAIG 21.1%
($FY2002)
Did not determine
25.6% NPV
IDA 40%
NPV
14.6%
GAO
10.3%-12.3%
30% procurement, 21% lifecycle
CAIG Study
The CAIG study examined the results of the engine competition for the Air Force F-16 fighter
program (also known as the Great Engine War—see “The “Great Engine War” of 1984-1994” in
Appendix B), the engine competition for the Navy and Marine Corps F/A-18 strike fighter
program,25 and the sole-source procurement of the Pratt & Whitney F-119 engine for the F-22.
The CAIG study noted that, in light of their analysis of past cost performance in acquisition
efforts using competition, the CAIG’s baseline “assumptions [were] generally favorable to dual
source case.”26 The study assumed that the second F-35 engine provider (General Electric/Rolls-
Royce) would meet the initial provider (Pratt & Whitney) in pricing in 2014, the first year of
competition. The study also assumed that competition would result in both an immediate 5%
price decrease in engine procurement costs and steeper rate of reduction in cost for producing
subsequent engines (i.e., a steeper slope on the production learning curve).27
25 The competition for the F/A-18 engine differed from the Great Engine War in that both GE and Pratt & Whitney
competed to build the same engine—the GE-designed F404. Although this did not permit a competition for engine
design and development, it permitted a competition for production price and production quality.
26 OSD Cost Analysis Improvement Group Report (v6), “F-35/JSF Alternate Engine Acquisition and Independent Cost
Analyses,” March 15, 2007, Slide 31.
27 The shift to a steeper learning curve in these analyses is referred to as learning curve rotation. The CAIG study
assumed that the learning curve would shift (i.e., rotate) five percentage points. As a notional example, a program
might originally have a 90% learning curve, meaning that the second item requires 90% as much labor to build as the
first, the fourth requires 90% as much as the second, the eighth requires 90% much as the fourth, the 16th requires 90%
as much as the eighth, and so on, with the quantities doubling each time to achieve the next 10% reduction in labor. A
five-percentage-point learning curve rotation would mean that this notional learning curve would shift to an 85% slope,
so that, for example, the fourth item might now require 85% as much labor to build as the second, and the eighth 85%
(continued...)
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The CAIG study estimated that an F-35 engine competition would need to achieve a 21.1%
reduction in engine procurement costs in constant FY2002 dollars over the lifetime of the
program to break even (i.e., to fully offset the costs associated with establishing and maintaining
a second source). On a net-present-value (NPV) basis,28 the study found the procurement-cost
reduction required for break-even would be 25.6%. On that basis, the study estimated that DOD
would be unable to recoup its initial investment in the alternate engine development program
through procurement savings alone. The CAIG study stated that DOD would need to effectively
compete engine operations and support (O&S) contracts to have a chance at attaining a 25.6%
savings to reach a break-even point by 2040. The report seemed skeptical that, even with
competition on O&S contracts, a 25.6% savings could be achieved.29
In addition to the non-financial benefits of engine competition cited by all three studies, the CAIG
study discussed the issue of growth potential in the F-35 engine. The study estimated that a
fourth- or fifth-generation fighter30 would experience an average of 7.2% weight growth between
Critical Design Review (CDR) and Initial Operational Capability (IOC) and an additional 0.3% of
weight growth thereafter.31 Such growth in aircraft weight would eventually require a
commensurate growth in engine thrust. The CAIG study stated that Pratt & Whitney’s F135
engine was already close to exceeding its designed engine temperature specifications, and would
require modifications beyond those that would be needed in the F136 engine to allow for thrust
growth.32
IDA Study
The IDA study examined the engine competition for the Air Force F-16 fighter program (the
Great Engine War) and the engine competition for the Navy and Marine Corps F/A-18 strike
fighter program.
The study estimated that an F-35 engine competition would result in a gross savings of 11% to
18%.33 IDA concluded that past studies of various procurement competitions showed an average
(un-weighted) savings of 14.6%.34
(...continued)
as much as the fourth, and so on.
28 An NPV estimate takes into account the real (i.e., above-inflation) investment value of money over time.
Government cost-estimating regulations call for using NPV analysis in situations involving an expected stream of
expenditures over many years.
29 OSD CAIG Report, Slide 37.
30 The F-15, F-16, and F/A-18 are considered “fourth-generation” fighters; due to stealth characteristics, system
integration, and other factors, the F-22 and F-35 are “fifth-generation.”
31 The CAIG’s estimated weight growth prior to IOC is greater than the F-35 Joint Program Office (JPO) estimate of
3%. The JPO also estimates that the F-35’s weight will remain unchanged after IOC.
32 Ibid. Slides 25 and 26. Note: Since the F136 is earlier in its development cycle, analysts comment that its design is
not as set as the F135 and could better incorporate engine growth requirements without major modifications.
33 Institute for Defense Analyses Report: “Joint Strike Fighter (JSF) Engine Cost Analysis: Summary of Results
(Revised),” March 2007, p. S-3. Note: IDA determined a 11% savings from competition over the upgraded F100-220
Pratt & Whitney engine and an 18% savings from competition between the original Pratt & Whitney F100 and the GE
F110 (p.23).
34 Ibid, p.24. However, IDA noted “significant inconsistencies” with studies of past competitions which need to be
taken into consideration when evaluating potential savings.
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F-35 Alternate Engine Program: Background and Issues for Congress
The IDA study estimated that an alternate engine program for the F-35 would incur direct and
indirect investment costs of $8.8 billion in constant FY2006 dollars.35 The study concluded that it
would not be feasible to recoup these investment costs through procurement-cost savings alone.
The study determined that for the alternate engine program to break even on an NPV basis, the
required amount of procurement-cost savings would be an “unrealistic” 40%, and that the
required amount of savings would decline to 18% if engine O&S contracts were also competed.36
The study stated that DOD “has not typically linked procurement and O&S costs in a single
competition” and therefore had limited historical data on which to base an estimate of potential
O&S savings.37
The IDA study states that contractor responsiveness was “the primary motivation for the Great
Engine War.”38 It stated that F-35s are to constitute 95% of the U.S. fighter/strike-fighter force by
2035, and that having an alternate engine could mitigate the risk of the entire F-35 fleet being
grounded due to an engine problem. The study posited that enhanced industry responsiveness to
engine upgrades and fixes resulting from competitive forces might have a significant effect on
overall fleet readiness.
GAO Study
The GAO study stated that procurement-cost savings of 10.3% to 12.3% would be required for
the alternate engine program to break even on its investment costs.39 The study stated that
analyses of past engine competitions have shown financial savings of up to 20%.40 The study
concluded that it is reasonable to assume that savings generated from competing the engine would
recoup the investment costs. Michael Sullivan, GAO’s director of Acquisition and Sourcing
Management, stated in testimony that he believed the alternate engine program would reach its
break-even point by the late 2020s.41 The study stated that DOD’s program management advisory
group recommended in 1998 and again in 2002 that the alternate engine program be continued
due to its non-financial benefits, in spite of only finding marginal financial benefits.
Size of F-35 Engine Production Run
The expected size of the F-35 production run can affect the potential for reaching a calculated
break-even point for an alternate engine program. Other things held equal, the smaller the F-35
production run, the less potential might exist for reaching a break-even point, and vice-versa. The
size of the F-35 production run will be influenced by both U.S. decisions on the number of F-35s
to be procured for the U.S. military, by foreign governments’ decisions on the numbers of F-35s
they want to purchase for their own militaries, and which engine is installed in each. Such
decisions can be made (and changed) multiple times over the course of many years, during which
time there could be multiple changes in the international security environment and U.S. and
35 Ibid., p. 20.
36 Ibid., p. S-3.
37 Ibid., p. S-3.
38 Ibid., p. 44.
39 Analysis of Costs for the Joint Strike Fighter Engine Program, GAO-07-656T, March 22, 2007, p. 1.
40 Ibid., p. 2.
41 Transcript of March 2, 2007, hearing on DOD aircraft programs before the Air and Land Forces subcommittee and
the Seapower and Expeditionary Forces subcommittee of the House Armed Services Committee.
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foreign defense budgets, making it difficult to project now what the ultimate size of the F-35
production run—or that of any particular engine—might be.
Contractor Offers of Fixed-Price Contracts
On September 1, 2009, the GE/Rolls-Royce team reportedly offered to build F136 engines for a
firm, fixed price after the first few lots.42 43 Two weeks later, Pratt & Whitney made an offer to
reduce the price of the F135 after the first three lots. This proposal would be a cost-plus contract,
although the company said an earlier offer of a fixed-price F135 contract had been declined by
DOD.44 GE/Rolls-Royce made a second fixed-price offer covering FY2012-FY2014 on April 27,
2010.45
A December 1, 2010, press report indicated that Pratt & Whitney and DOD had agreed on a
fixed-price contract for F135s to equip F-35s procured under Low Rate Initial Production Lot
IV.46
Relations with Allies
A Memorandum of Understanding (MOU) between the United States and eight other countries on
the production, sustainment, and follow-on development of the JSF that was signed by the United
States on November 14, 2006, states in Section III, regarding Scope of Work (paragraph 3.2.1.1),
that:
The production work [of the JSF Air System] will include, but will not be limited to, the
following...
Production of the JSF Air Vehicle, including propulsion systems (both F135 and F136).47
In response to a question from CRS on whether this MOU has been superseded or changed, the
Air Force states:
The Joint Strike Fighter (JSF) System Development and Demonstration (SDD)
Memorandum of Understanding (MOU) scope of work includes development of JSF primary
42 John T. Bennett, “GE Pitches Fixed-Price Deal For Alternate JSF Engine,” DefenseNews.com, September 1, 2009.
43 Guy Norris, “Alternate JSF Engine Team Puts Pressure On Pratt & Whitney,” Aerospace Daily & Defense Report,
September 3, 2009, pp.1-2. See also Marina Malenic and Emelie Rutherford, “GE, Rolls-Royce Look To Align With
Acquisition Reformers In Fixed Price Engine Offer,” Defense Daily, September 3, 2009, p. 6.
44 Marina Malenic, “Pratt Offers To Trim F135 Costs,” Defense Daily, September 16, 2009, p. 1.
45 GE/Rolls Royce press release, “GE and Rolls-Royce Propose Fixed Price Offer for F-35 Joint Strike Fighter Engine
to Significantly Drive Down Costs,” press release, April 27, 2010.
46 Graham Warwick, “Pratt Agrees To Fixed Prices For F-35 Engines,” Aerospace Daily, December 1, 2010.
47 Memorandum of Understanding among the Department of Defence of Australia and the Minister of National
Defence of Canada and the Ministry of Defence of Denmark and the Ministry of Defence of the Republic of Italy and
the State Secretary of Defence of the Kingdom of the Netherlands and the Ministry of Defence of the Kingdom of
Norway and the Undersecretariat for Defense Industries on behalf of the Ministry of National Defense of the Republic
of Turkey and the Secretary of State for Defence of the United Kingdom of Great Britain and Northern Ireland and the
Secretary of Defense on behalf of the Department of Defense of the United States of America Concerning the
Production, Sustainment, and Follow-on Development of the Joint Strike Fighter (Short Title—JSF PSFD MOU), p.
16. The MOU was provided to CRS on September 17, 2009, by the Air Force legislative affairs office.
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and alternate propulsion systems which—consistent with the provisions used in all
Department of Defense development, acquisition, and support MOUs—is ultimately subject
to the availability of U.S. and partner nation funds for such purposes. The PSFD MOU
provision (para 3.2.1.1.) regarding cooperative production and procurement of F135 and
F136 remains valid. The Department will continue to implement both its JSF SDD and PSFD
MOU obligations subject to availability of U.S. and partner funds. We have engaged in
consultations with our partners on the Administration’s decision not to include F136 in its
RDT&E funding requests.... We do not plan to amend either the JSF SDD MOU or PSFD
MOU regardless of the outcome of the U.S. FY10 authorization and appropriation process.48
Other European countries, such as the Netherlands, are home to firms that participate in both the
F135 and F136 programs.49 As European companies secure more F-35-related contracts, the
position of each partner nation on the need for the second engine might evolve depending on their
economic interest in each engine.
On September 3, 2010, British Secretary of State for Defence Liam Fox wrote to Senator Carl
Levin, Chairman of the Senate Armed Services Committee, in support of the F136. “The U.K.—
and we believe other international partners on the programme—are worried that a decision now to
cancel the second engine may save money in the short term but end up costing the U.S. and her
partners much more in the long term.”50
Engine Development Issues
Both JSF engines have experienced development challenges typical of new engine programs,
including failures during ground testing.
Testing Incidents
On August 30, 2007, and February 4, 2008, the F135 engine experienced failures during ground
testing. The JSF Joint Program Office stated that the engine failures in both cases were due to
“high-cycle fatigue” resulting in the failure of a turbine blade.51 A Navy official testified in 2008
that the second engine failure was as a result of ongoing testing to determine the causes of the
first failure. DOD officials stated that these engine malfunctions delayed the expected first flight
of the F-35B aircraft by a month or two. The engine failures and resulting delays may have
contributed to a reported cost overrun of up to $850 million in the F135 program.52
48 Source: Untitled information paper on JSF PSFD MOU provided to CRS by Air Force legislative liaison office,
September 21, 2009.
49 Joris Janssen Lok. “Double Dutch; Pratt, Rolls Involve More Dutch Partners in F135, F136 Programs,” Aviation
Week & Space Technology, February 11, 2008. On May 20, 2010, the Dutch parliament nonetheless voted to withdraw
from the F-35 program. The withdrawal is not yet binding. Christina Mackenzie, “Dutch Cancel Order for F-35 JSF,”
Aviation Week/Ares blog, May 21, 2010.
50 Frank Oliveri, “U.K. Defense Agency Weighs In on Alternative Engine for Joint Strike Fighter,” CQ Today,
September 24, 2010.
51 Jason Simpson. “Davis: JSF Program Office Anticipated Early-Stage Engine Problems.” Inside the Air Force,
February 15, 2008.
52 Tony Capaccio. “United Technologies F-35 Engine Over Cost Estimate.” Bloomberg.com. July 21, 2008.
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An F135 was damaged in a test on September 11, 2009. Pratt & Whitney attributed the damage to
a worn bushing that led to damage to the tips of some fan blades.53 The company said the damage
occurred to a second generation of the engine, not the version on current flight-test aircraft, and
that a “minor modification” would be incorporated immediately in all initial service release (ISR)
production engines “with little or no impact on cost and schedule.”54
The F136 has encountered three test incidents. In September 2009, an F136 was reported to have
ingested a test sensor, causing minor damage.55 On October 2, 2009, impact damage was found
on a number of blades in the high- and low-pressure turbines.56 Investigation revealed that a nut
had come loose and been ingested into the engine, leading to a minor redesign to better secure the
nut.57 On September 23, 2010, an F136 sustained damage to its fan and compressor. Although the
cause was later attributed to an issue peculiar to that one engine, GE initiated a design change to
prevent a recurrence.58
Reported F135 Quality-Control Issues
In July 2009, then-JSF program manager Marine Corps Brigadier General David Heinz criticized
Pratt & Whitney for quality control deficiencies reported to have led to the 24% growth in F135
costs. “There are portions of articles that I am building today that I throw away one for every one
I build because the scrap and rework rate has not come up to a lean manufacturing process.... I
believe, even at this point, that [the yield] should be eighty percent—where I’m scrapping one in
five [parts] as opposed to one of every two.”59
Pratt & Whitney responded that only a few parts had a high scrap rate. “In the case of a couple of
parts ... we’re at 70 to 80 percent [yield] rate, which at this point in the program is exactly where
we should be,” William Begert, the vice president of business development said. “Overall, we’re
doing very well on scrap rate … we’re running 97 percent for the total engine. So to say that we
have a 50 percent scrap rate ... is grossly inaccurate. It’s just not true.”60
53 Graham Warwick, “Pratt Identifies Probable Cause Of F135 Failure, Aerospace Daily & Defense Report, September
21, 2009, p. 3.
54 Graham Warwick, “F135 Engine Damaged In Ground Tests,” Aerospace Daily & Defense Report, September 15,
2009. A very similar version of this article was published on September 14, 2009, as Graham Warwick, “F135 Engine
Damaged In Ground Tests,” AviationWeek.com, September 14, 2009.
55 Guy Norris, “Alternate JSF Engine Team Puts Pressure On Pratt & Whitney,” Aerospace Daily & Defense Report,
September 3, 2009, pp. 1-2. See also Marina Malenic and Emelie Rutherford, “GE, Rolls-Royce Look To Align With
Acquisition Reformers In Fixed Price Engine Offer,” Defense Daily, September 3, 2009, p. 6.
56 Jason Simpson, “F136 Engine Sustains Impact Damage in Test, Possible Cause IDed (Updated),” InsideDefense.com
(DefenseAlert—Daily News), October 8, 2009. Other press reports on the same incident include Graham Warwick,
“Damage Discovery Halts F136 Engine Testing,” Aerospace Daily & Defense Report, October 9, 2009, p. 3 and
Marina Malenic, “F136 Engine Testing Suspended After Discovery of ‘Dings and Nicks,’” Defense Daily, October 9,
2009, p. 1.
57 Andrea Shalal-Esa, “GE, Rolls To Redesign Part Of F-35 Engine,” Reuters.com, November 2, 2009.
58 Guy Norris, “GE/Rolls-Royce Team Details Design Fix For F136 Test Glitch,” Aerospace Daily, October 22, 2010.
59 Marina Malenic, “Heinz Raps Pratt On F-35 Engine Manufacturing Practices,” Defense Daily, July 29, 2009, p. 3.
Material in brackets as in original.
60 Marcus Weisgerber, “Pratt & Whitney: Allegations About F135 Engine Scrap Rates ‘Not True’ (Updated), Inside the
Air Force, August 7, 2009.
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Engine Performance
A production-representative General Electric F136 reportedly achieved 115% of its required
thrust in testing in August, 2010. Pratt & Whitney “plans to start tests of a higher-thrust F135 in
January 2011.”61
Issues for Congress
Because the administration’s FY2011 budget again proposes terminating the alternate engine
program, a fundamental issue for Congress is whether to continue the program or accept program
termination.
If the alternate engine program is continued, subsidiary questions may include (but are not limited
to) the following:
How the Alternate Engine Program Should be Funded
Congressional appropriations have drawn on various sources of funds to support the alternate
engine program. Some money came from existing F-35 program funds, and some from adding
funds from within the DOD topline. Although the topline was increased in each year, it is not
clear what portion of the increases were dedicated to the alternate engine program.
The source of funds may have a direct effect on other DOD programs. If alternate engine funds
are allocated within the existing F-35 budget lines, other F-35 activities may be curtailed in favor
of the alternate engine program. For example, “[f]orcing the program to fund development of the
General Electric/Rolls-Royce F136 from within the existing JSF budget would ‘take 50-80 tails
out of the program’ over the next five years, says [then] program executive officer (PEO), Marine
Corps Brig. Gen. David Heinz.”62
Similarly, increasing the F-35 program topline to account for the effects of increased alternate
engine funding, without concomitantly increasing the DOD topline, could force the transfer of
funds from other defense programs to F-35.
Congress may face a choice of whether the alternate engine program should be continued if doing
so means reducing in the number of F-35s procured (either overall or in a given year); incurring
other delays in the program; or reducing other defense capabilities to pay for it.
Credibility of Cost Estimates Showing Little Difference Between
the Cost of One Engine Program and the Cost of Two
As noted earlier, press accounts stated that DOD’s Joint Assessment Team found that fielding and
support of two F-35 engines would cost about the same as just one engine, due in part to the
effect of congressionally directed appropriations over the past four years. A February 2010 letter
61 Guy Norris, “Alternate JSF Engine Thrust Beats Target,” Aviation Week, August 17, 2010.
62 Graham Warwick and Guy Norris, “Second Engine Could Cut F-35 Production,” AviationWeek.com, May 29, 2009.
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from DOD’s Director of Cost Assessment and Program Evaluation cited the need for an
additional “$2.9 billion (TY$) over the next six years” to develop the F136 to the point where
competition would be possible.63 A September 15, 2010 Government Accountability Office report
stated that the $2.9 billion figure “does not include the same level of fidelity and precision
normally associated with a detailed, comprehensive estimate” and that “(d)ifferent assumptions
and more detailed information could either increase or decrease the $2.9 billion funding
projection accordingly.”64
It may be useful to note that two very different costs are being discussed here: the up-front cost of
developing the F136, which can have consequences in the current budget year, and the lifetime
cost. Supporters of the F136 refer to GAO’s May 20, 2009 study showing that the up-front cost of
developing the F136 may be balanced over the life of the program by savings from competition, a
point on which point the CAIG and IDA studies disagreed. Assumptions regarding the effects of
competition on cost are key to these analyses. Congress may have to choose which assumptions it
believes.
Controls to Curb Cost Growth Absent Competition
Competition is cited by GAO and advocates of alternate engine procurement as providing an
inherent check on cost growth in either competitor’s product. Absent competition, DOD (and
other government agencies) negotiate contracts based on experience with similar products to
establish prices. Those contracts take different forms, but generally include incentives for the
contractor to achieve certain cost targets and penalties for missing them.
Importance of the Potential Fleet-Grounding Issue Attributed to
Procuring a Single Engine
Congress may consider whether the fleet-grounding risk of a single engine type for F-35
represents a greater risk than is already accepted with other aircraft fleets, and whether the risk is
sufficient to justify procurement of a second engine.
Those supporting an alternate engine note that F-35s are to constitute the majority of future U.S.
fighters, and that using a single type of engine creates a risk of all F-35s being grounded in the
event of a problem with that engine. The Marine Corps grounded 106 AV-8B Harriers in July
2000 after a faulty engine bearing was cited as the cause of a crash.65 About 18% of Navy
groundings from 1997 to 2006 were due to engine issues.66 The Air Force stood down two fleets
due to engine issues between 1990 and 2006.67
63 Christine Fox, “Information memorandum: Update of Joint Strike Fighter (JSF) Alternate Engine Cost/Benefit
Analysis,” undated. Press reports and CRS sources indicate that the letter was received by the Congressional defense
committees in February, 2010.
64 U.S. Government Accountability Office, Joint Strike Fighter: Assessment of DOD’s Funding Projection for the F136
Alternate Engine, GAO-10-1020R, September 15, 2010.
65 Mark Oliva, “Pilots defend Harrier jet.” Stars and Stripes. (Pacific Edition). January 19, 2003.
66 66% were due to airframe-related issues. (“JSF Engine Second Source Executive Summary,” Whitney, Bradley, and
Brown Consulting; December 2006. Slide 23.)
67 Ibid. As noted above, during the same period the Air Force grounded the entire F-15 fleet due to airframe issues.
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DOD officials argue that terminating the F136 alternate engine program poses little operational
risk. Past decisions to pursue alternate engines for Air Force F-15s and F-16s and Navy F-14s,
they state, were made at a time when the services were dissatisfied with the performance of
existing engines (the F100 and TF30). DOD argues that these same conditions do not exist today.
DOD argues that advances such as computational fluid design for airflow prediction and
advanced software for prognostic health monitoring reduce the operational risks of relying on a
single engine type for an aircraft.68 They argue that the advanced software will result in engines
that can diagnose their own condition and notify the pilot of impending failure (as opposed to
notifying pilots of a failure once it has occurred). Advanced warning of impending failures could
give a pilot time to land prior to failure, and allow more efficient and cost-effective maintenance
procedures.
The Operational and Logistical Impacts of Supporting Two Engines
Even if the costs of supporting two engines are the same as supporting one, operational and
logistical issues may complicate the use of multiple engines. The Navy, for example, has limited
facilities to support multiple engines. As noted earlier, Chief of Naval Operations Admiral Gary
Roughead was quoted in a press report as saying, “I’m in the one engine camp… On a carrier,
space matters.”69
This was implicitly recognized by Air Force Chief of Staff Norton Schwartz in testimony before
the House Armed Services Committee when he said, “[A] concern that I have is the reality that
the alternate engine is not for anybody else but the Air Force. The Navy isn’t going to operate an
alternate engine aboard ships. The European partners are not going to operate two engines. You’re
talking about focusing this on your Air Force, which is problematic in my view.” 70 Nonetheless,
the Air Force has considerable experience supporting multiple engine types for single-airframe
fleets, having done so with the F-16 and F-15 for over 20 years.
Congress may be faced with the choice of whether to direct multiple engines for one service or
the entire F-35 buy.
Impacts on the Military Turbine Industrial Base of Procuring One
Engine Rather than Two
Since Pratt & Whitney and General Electric are the only two U.S. manufacturers of fighter
aircraft engines, a potential issue for policy makers is what effect terminating the F136 engine
might have on General Electric’s ability to compete for future fighter aircraft engines, assuming
domestically owned and sourced competition is desirable.71 “The engine debate is complex, but it
68 Ibid.
69 Graham Warwick, “Navy Backs Single JSF Engine As F-35C Rolls Out,” Aerospace Daily & Defense Report, July
29, 2009, pp. 1-2. See also Antonie Boessenkool, “Pratt & Whitney’s Costs Parts-Reject Rate Too High: JSF Official,”
Defense News, August 3, 2009.
70 Transcript of House Armed Services Committee hearing on Fiscal 2011 budget request for the Department of the Air
Force, February 23, 2010.
71 Rolls-Royce is a co-developer of the F136, but does not currently supply its own engines for any U.S. fighter.
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boils down to whether the Pentagon should pay GE up to $3 billion to compete with Pratt,” stated
a USA Today editorial.72
General Electric has a significant share of the market for commercial aircraft engines. It also
builds and maintains F400 series engines for the Navy and Marine Corps F/A-18E/F strike
fighters and EA-18G electric attack aircraft, and supports the F110 series of engines for domestic
and international clients. The CAIG and IDA studies of 2007 noted General Electric’s strong
position in the commercial engine market. The CAIG study stated that General Electric produced
1,000 commercial engines in 2007, while Pratt & Whitney produced 220 commercial engines.73
The CAIG study noted that General Electric derives about 15% of its business from military
engines, while Pratt & Whitney derives about 50% of its business from military engines.74
A key question is how sufficient General Electric’s work on engines other than the F136
(including the F400 and F110 series military engines) would be for preserving General Electric’s
ability to design and produce fighter engines if the F136 program were terminated. The CAIG
study of 2007 stated that about 200 General Electric military jet engineers would be unable to
transfer their skills to General Electric’s commercial engines if the F136 engine were terminated,
potentially reducing GE’s ability to compete for future military engine contracts.
Ending the F136 program might lead to a reduction in the number of suppliers for F-35 engine
spare parts, potentially increasing the vulnerability of the F-35 engine spare parts supply chain to
disruptions caused by labor disagreements or natural disasters. Alternatively, maintaining a
competition between the F135 and F136 for the production of F-35 engines could reduce the
workload for individual F135 suppliers and create uncertainty for both F135 and F136 suppliers
regarding annual business volumes. One defense consulting firm stated in 2006 that
approximately 50% of each engine is procured in a competitive environment today, suggesting
that multiple vendors could create parts for each of the engines.75 The IDA study of 2007
examined the top F136 component suppliers and concluded that it is “unlikely that any supplier
would exit the domestic industrial base because of F136 termination.”76
Although the IDA study of 2007 concluded that the U.S. industrial base may not be “irreparably
harmed” if the F136 engine is terminated, the study expressed reservations about DOD placing all
of its fighter engine production with a firm that has a weak position in the commercial
marketplace, because a firm with a relatively small presence in the commercial marketplace
would have fewer resources that could be leveraged for use on DOD products.77 As mentioned
earlier, the IDA study of 2007 examined the top F136 component suppliers and concluded that it
is “unlikely that any supplier would exit the domestic industrial base because of F136
72 “Our view on defense spending: It’s time to put a hold on the Pentagon’s blank check,” USA Today, May 21, 2010,
on USAToday.com.
73 OSD Cost Analysis Improvement Group Report (v6), “F-35/JSF Alternate Engine Acquisition and Independent Cost
Analyses,” March 15, 2007, Slide 44.
74 Ibid. Slide 44.
75 Ibid. Slide 22. Note: See http://www.wbbinc.com on Whitney, Bradley, and Brown, their corporate profile and their
clients.
76 IDA JSF Final Report, p. 165.
77 Ibid, p. 169.
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termination.”78 The IDA study concluded that, overall, the U.S. industrial base would be stronger
as a result of an active F136 program.
Some of those who participated in or studied the Great Engine War argue that the competition
between General Electric and Pratt & Whitney made Pratt & Whitney and General Electric better
and “proved invaluable to future engine development.”79
Congress may consider whether such industrial policy implications add a non-monetary value to
the choice of one or two engines, and an appropriate financial cost to achieve the benefits of
competition.
FY2011 Legislative Actions
FY2011 Defense Authorization Act (H.R. 5136)
House
As reported by the House Armed Services Committee on May 19, 2010, H.R. 5136 included $485
million for development of an alternate F-35 engine. The bill also included language that would
prevent DOD from spending more than 75% of its F-35 budget until all alternate engine funds
had been obligated.80 The language states:
SEC. 212. LIMITATION ON OBLIGATION OF FUNDS FOR F–35 LIGHTNING II
AIRCRAFT PROGRAM.
Of the amounts authorized to be appropriated by this Act or otherwise made available for
fiscal year 2011 for research, development, test, and evaluation for the F–35 Lightning II
aircraft program, not more than 75 percent may be obligated until the date that is 15 days
after the date on which the Under Secretary of Defense for Acquisition, Technology, and
Logistics submits to the congressional defense committees certification in writing that all
funds made available for fiscal year 2011 for the continued development and procurement of
a competitive propulsion system for the F–35 Lightning II aircraft have been obligated.
The bill as reported also includes obligation of alternate engine funds as one of the criteria
required before DOD can acquire more than 30 F-35 aircraft. In pertinent part:
SEC. 141. LIMITATION ON PROCUREMENT OF F–35 LIGHTNING II AIRCRAFT.
(a) LIMITATION.—Except as provided in subsection (c), of the amounts authorized to be
appropriated by this Act or otherwise made available for fiscal year 2011 for aircraft
procurement, Air Force, and aircraft procurement, Navy, for F–35 Lightning II aircraft, not
78 Ibid, p. 165.
79 Maj. John Nix and Maj. Riley Shelnutt. “Behind the Alternate Fighter Engine Competition.” Aerospace America.
May 1984.
80 H.R. 5136, National Defense Authorization Act for Fiscal Year 2011, as passed by the House Armed Services
Committee on May 19, 2010.
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more than an amount necessary for the procurement of 30 such aircraft may be obligated or
expended unless—
(1) the certifications under subsection (b) are received by the congressional defense
committees on or before January 15, 2011; and (2) a period of 15 days has elapsed after the
date of such receipt.
CERTIFICATIONS.—Not later than January 15, 2011—
(1) the Under Secretary of Defense for Acquisition, Technology, and Logistics shall certify
in writing to the congressional defense committees that—
…(F) advance procurement funds appropriated for the advance procurement of F136 engines
for fiscal years 2009 and 2010 have either been obligated or the Secretary of Defense has
submitted a reprogramming action to the congressional defense committees that would
reprogram such funds to meet other F136 development requirements; and
…(E) six F136 engines have been made available for testing; and
(F) not less than 1,000 test hours have been completed in the F136 system development and
demonstration program.
H.R. 5136 would also require the Secretary of Defense to include alternate engine funding in
DOD’s annual budget submission:
SEC. 213. INCLUSION IN ANNUAL BUDGET REQUEST AND FUTURE-YEARS
DEFENSE PROGRAM OF SUFFICIENT AMOUNTS FOR CONTINUED
DEVELOPMENT AND PROCUREMENT OF COMPETITIVE PROPULSION SYSTEM
FOR F–35 LIGHTNING II AIRCRAFT.
(a) ANNUAL BUDGET.—Chapter 9 of title 10, United States Code, is amended by adding
at the end the following new section:
‘‘§ 236. Budgeting for competitive propulsion system for F–35 Lightning II aircraft
‘‘(a) ANNUAL BUDGET.—Effective for the budget for fiscal year 2012 and each fiscal
year thereafter, the Secretary of Defense shall include in the defense budget materials a
request for such amounts as are necessary for the full funding of the continued development
and procurement of a competitive propulsion system for the F–35 Lightning II aircraft.
‘‘(b) FUTURE-YEARS DEFENSE PROGRAM.—In each future-years defense program
submitted to Congress under section 221 of this title, the Secretary of Defense shall ensure
that the estimated expenditures and proposed appropriations for the F–35 Lightning II
aircraft, for each fiscal year of the period covered by that program, include sufficient
amounts for the full funding of the continued development and procurement of a competitive
propulsion system for the F–35 Lightning II aircraft.
‘‘(c) REQUIREMENT TO OBLIGATE AND EXPEND FUNDS.—Of the amounts
authorized to be appropriated for fiscal year 2011 or any fiscal year thereafter, for research,
development, test, and evaluation and procurement for the F–35 Lightning II aircraft
program, the Secretary of Defense shall ensure the obligation and expenditure in each such
fiscal year of sufficient annual amounts for the continued development and procurement of
two options for the propulsion system for the F–35 Lightning II aircraft in order to ensure the
development and competitive production for the propulsion system for such aircraft.
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‘‘(d) DEFINITIONS.—In this section:
‘‘(1) The term ‘budget’, with respect to a fiscal year, means the budget for that fiscal year
that is submitted to Congress by the President under section 1105(a) of title 31.
‘‘(2) The term ‘defense budget materials’, with respect to a fiscal year, means the materials
submitted to Congress by the Secretary of Defense in support of the budget for that fiscal
year.’’.
(b) CLERICAL AMENDMENT.—The table of sections at the beginning of such chapter is
amended by at the end the following new item:
‘‘236. Budgeting for competitive propulsion system for F–35 Lightning II aircraft.’’.
(c) CONFORMING REPEAL.—Section 213 of the National Defense Authorization Act for
Fiscal Year 2008 (Public Law 110–181) is repealed.
H.R. 5136 further designated the competitive F-35 engine programs as major subprograms,
imposing more stringent oversight and reporting requirements.
SEC. 802. DESIGNATION OF F135 AND F136 ENGINE DEVELOPMENT AND
PROCUREMENT PROGRAMS AS MAJOR SUBPROGRAMS.
(a) Designation as Major Subprograms- Not later than 30 days after the date of the
enactment of this Act, the Secretary of Defense shall designate each of the engine
development and procurement programs described in subsection (b) as a major subprogram
of the F-35 Lightning II aircraft major defense acquisition program, in accordance with
section 2430a of title 10, United States Code.
(b) Description- For purposes of subsection (a), the engine development and procurement
programs are the following:
(1) The F135 engine development and procurement program.
(2) The F136 engine development and procurement program.
(c) Original Baseline- For purposes of reporting requirements referred to in section 2430a(b)
of title 10, United States Code, for the major subprograms designated under subsection (a),
the Secretary shall use the Milestone B decision for each subprogram as the original baseline
for the subprogram.
(d) Actions Following Critical Cost Growth-
(1) IN GENERAL- Subject to paragraph (2), to the extent that the Secretary elects to
restructure the F-35 Lightning II aircraft major defense acquisition program subsequent to a
reassessment and actions required by subsections (a) and (c) of section 2433a of title 10,
United States Code, during fiscal year 2010, and also conducts such reassessment and
actions with respect to the F135 and F136 engine development and procurement programs
(including related reporting based on the original baseline as defined in subsection (c)), the
requirements of section 2433a of such title with respect to a major subprogram designated
under subsection (a) shall be considered to be met with respect to the major subprogram.
(2) LIMITATION- Actions taken in accordance with paragraph (1) shall be considered to
meet the requirements of section 2433a of title 10, United States Code, with respect to a
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major subprogram designated under subsection (a) only to the extent that designation as a
major subprogram would require the Secretary of Defense to conduct a reassessment and
take actions pursuant to such section 2433a for such a subprogram upon enactment of this
Act. The requirements of such section 2433a shall not be considered to be met with respect
to such a subprogram in the event that additional programmatic changes, following the date
of the enactment of this Act, cause the program acquisition unit cost or procurement unit cost
of such a subprogram to increase by a percentage equal to or greater than the critical cost
growth threshold (as defined in section 2433(a)(5) of such title) for the subprogram.
The report accompanying H.R. 5136, H.Rept. 111-491, includes other language regarding the F-
35 alternate engine program. Under Air Force Research & Development/Items of Special Interest,
the report states:
F-35 aircraft
The budget request contained $2.4 billion in PEs 64800F, 64800N, and 64800M for
development of the F-35 aircraft, but contained no funds for development of a competitive F-
35 propulsion system. The budget request also contained $7.7 billion in Aircraft
Procurement, Air Force and Aircraft Procurement, Navy for procurement of 22 F-35As, 13
F-35Bs, and 7 F-35Cs.
The competitive F-35 propulsion system program is developing the F136 engine, which
would provide a competitive alternative to the currently-planned F135 engine. For the past
four years, the committee recommended increases for the F-35 competitive propulsion
system, and notes that in all cases, funds have been appropriated by Congress for this
purpose. Despite section 213 of the National Defense Authorization Act for Fiscal Year 2008
(P.L. 110-181), which requires the Secretary of Defense to obligate and expend sufficient
annual amounts for the continued development and procurement of a competitive propulsion
system for the F-35, the committee is disappointed that the Department of Defense (DOD)
has, for the fifth consecutive year, chosen not to comply with both the spirit and intent of this
law by opting not to include funds for this purpose in the budget request.
In the committee report accompanying the National Defense Authorization Act for Fiscal
Year 2010 (H.Rept. 111-166), the committee noted cost increases in the F135 development
program, as well as cost increases for the procurement of F135 engines between December
2005 and December 2008. A March 2010 report on the Joint Strike Fighter by the
Government Accountability Office (GAO) notes that F135 engine development cost is now
estimated to cost $7.3 billion, a 50 percent increase over the original contract award. In its
report, GAO also notes that for the fiscal year 2009 F135 engine contract, the negotiated
price for the F-35B engine and lift fan was 21 percent higher than the budget estimate, and
the negotiated unit cost for the F-35A engine was 42 percent higher than budgeted. Over the
past year, as a result of these cost increases in fiscal year 2009, the Under Secretary of
Defense for Acquisition, Technology, and Logistics directed that a Joint Assessment Team
(JAT) review the F135 cost structure, and the JAT concluded that engine contractor
improvement plans were credible but challenging, and would require additional investment
by the contractor for cost reduction initiatives.
On February 23, 2010, the Deputy Secretary of Defense submitted to the committee an
update of the 2007 DOD `Joint Strike Fighter Alternate Engine Acquisition and Independent
Coast Analysis’ for the competitive engine program which noted that an investment of $2.9
billion over six years in additional cost would be required to finish F136 engine development
and to conduct directed buys to prepare the F136 for competitive procurement of F-35
engines in 2017. This report also noted that long-term costs for either a one-engine or two-
engine competitive acquisition strategy are the same, on a net present value basis.
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Given the F135 development and procurement cost increases and that long-term F-35 engine
costs would be the same for a competitive F-35 engine acquisition strategy, the committee is
puzzled by the Department’s decisions over the past five years to not include an F-35
competitive propulsion system program in its budget requests. The committee remains
unwavering in its belief that the non-financial factors of a two-engine competitive program,
such as better engine performance, improved contractor responsiveness, a more robust
industrial base, increased engine reliability and improved operational readiness, strongly
favor continuing the F-35 competitive propulsion system program. Therefore, the committee
recommends a total increase of $485.0 million for the competitive engine program in PEs
64800F, 64800N, and 64800M as noted in the funding tables elsewhere in this report.
Over the past year, the F-35 Joint Program Office (JPO) and F-35 contractor failed to meet
promised expectations with regard to cost and schedule performance. As a result, in addition
to the JAT, the Department of Defense conducted two other reviews of the F-35 program
which included a 2009 update to the 2008 Joint Estimating Team (JET), known as JET 2,
and chartered an independent manufacturing review team (IMRT). The JET 2 was tasked to
conduct an independent cost and schedule estimate of the development and production
program, while the IMRT reviewed production capacity and risk. The JET 2 concluded that
the F-35 development program would take 30 months longer and cost some $3.0 billion
more, and the IMRT concluded that the contractor’s planned production ramp rates were
high risk and not achievable within the contractor’s planned timeframe. To reduce
development and production risk, the Department of Defense proposes to procure one
additional F-35C developmental test aircraft; stand-up an additional software simulation
facility; utilize three operational F-35s for developmental test purposes; adjust the production
profile in line with the IMRT recommendations and reduce planned production in the Future
Years Defense Program by 122 aircraft; and increase amounts budgeted for F-35
development and production. Together, these actions are projected to delay the completion of
F-35 development by 13 months compared to last year’s plan, and cost $2.8 billion more. In
accordance with section 2433 of title 10, United States Code, the Secretary of the Air Force
informed the committee on March 25, 2010, that the F-35 program will exceed unit cost
thresholds by more than 50 percent compared to the original baseline estimate.
On March 11, 2010, in testimony before the Senate Committee on Armed Services, the
Under Secretary of Defense for Acquisition, Technology, and Logistics described the F-35
program as having `unprecedented concurrency’ of development, test, and production
activities. On March 24, 2010, at a hearing held jointly by the Subcommittee on Air and
Land Forces and the Subcommittee on Seapower and Expeditionary Forces, the Office of the
Secretary of Defense’s Director of Operational Test and Evaluation testified that `the
primary issues with the Joint Strike Fighter program have been late delivery of test aircraft
and the failure to adjust to the reality by building and resourcing realistic system
development and test plans, as well as plans for producing and delivering aircraft.’
Additionally, on March 24, 2010, GAO’s Director of Acquisition and Sourcing Management
testified to the Subcommittee on Air and Land Forces and the Subcommittee on Seapower
and Expeditionary Forces that the `DOD intends to procure up to 307 aircraft at a cost of
$58.2 billion before completing developmental flight testing by mid-fiscal year 2015.’ The
committee notes that, under current plans in the spring of 2015, the Department will have
requested a total of 550 aircraft, over 22 percent of the planned procurement of 2,443 F-35s,
before developmental testing is complete. The committee also notes that, notwithstanding the
JAT, JET 2, and IMRT findings and continued unprecedented research and development and
procurement concurrency, the request for 43 total F-35 aircraft for fiscal year 2011 is the
same as projected in fiscal year 2009 for fiscal year 2011. In its testimony on March 24,
2010, GAO also noted that `with most of development testing still ahead, the risk and impact
from required design changes are significant,’ and may require `alterations to the production
process, changes to the supply base and costly retrofitting of aircraft already produced and
fielded.’ Consequently, the committee remains concerned that despite the Department’s
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recent reduction of 122 aircraft in the Future Years Defense Program, the F-35 production
ramp rate may still too high and the Department should consider further reductions until
developmental testing is complete.
For fiscal year 2011, the committee recommends authorization of the budget request for 42
aircraft, subject to the Department’s completion of certain milestones planned by the
Department for calendar year 2010. Accordingly, the committee recommends a provision
(sec. 141) which would require the Under Secretary of Defense for Acquisition, Technology,
and Logistics and the Director of Operational Test and Evaluation to certify, not later than
January 15, 2011, that certain milestones have been completed before an amount necessary
for the procurement of more than 30 F-35 aircraft would be obligated or expended.
A May 27, 2010, statement of administration policy on H.R. 5136 states:
F-35 Joint Strike Fighter (JSF) Extra Engine: The Administration strongly objects to the
addition of $485 million for the extra engine program and to associated legislative provisions
that limit the obligation of overall JSF development funding to 75 percent of the amount
authorized until the funds for FY 2011 have been obligated for the extra engine program,
require the Secretary to ensure that each budget in the Future Years Defense Plan include,
and expend, sufficient funding to continue the program, and designate the F135 and F136
engine development and procurement programs as major subprograms. As Secretary Gates
has noted, even after factoring in Congress’ additional funding, the extra engine would still
require a further investment of $2.4 billion before it could be considered as a viable extra
engine for the JSF program. The Department does not believe that this cost will ever be
recovered in a hypothesized competition or that the funds should be diverted from important
defense needs. The current engine is performing well with more than 13,000 ground test and
200 flight test hours. If the final bill presented to the President includes funding or a
legislative direction to continue an extra engine program, the President’s senior advisors
would recommend a veto.81
Senate
The report accompanying S. 3454 (S.Rept. 111-201 of June 4, 2010) included a certification
requirement prior to expenditure of further funding for the alternate engine:
Limitation on use of funds for alternative propulsion system for the F-35 Joint Strike
Fighter program (sec. 211)
The committee recommends a provision that would require that, before spending any
additional funds on the F136 engine that is being developed as an alternative propulsion
system of the F-35 Joint Strike Fighter program, the Secretary of Defense would have to
certify that development of the alternate propulsion system:
(1) will:
(a) reduce the total life cycle-cycle costs of the F-35 Joint Strike Fighter program;
(b) improve the operational readiness of the fleet of F-35 Joint Strike Fighter aircraft; and
81 Executive Office of the President, Office of Management and Budget, Statement of Administration Policy, H.R.
5136 - National Defense Authorization Act for Fiscal Year 2011, June 24, 2009. Emphasis as in the original.
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(2) will not:
(a) disrupt the F-35 Joint Strike Fighter program during the research, development, and
procurement phases of the program; or
(b) result in the procurement of fewer F-35 Joint Strike Fighter aircraft during the life cycle
of the program.
Final Action
As passed, H.R. 6523, the Ike Skelton National Defense Authorization Act For Fiscal Year 2011,
did not include program-level detail, so there is no amount specified for the F-35 alternate engine
(nor, for that matter, the F-35 itself.)
In lieu of a conference report, the House and Senate Armed Services Committees issued a joint
explanatory statement regarding H.R. 6523.
The joint explanatory statement included an amended version of the House language designating
an F-35 engine development and production subprogram, as follows:
SEC. 802. DESIGNATION OF ENGINE DEVELOPMENT AND PROCUREMENT
PROGRAM AS MAJOR SUBPROGRAM.
(a) Designation as Major Subprogram- Not later than 30 days after the date of the enactment
of this Act, the Secretary of Defense shall designate an engine development and procurement
program as a major subprogram of the F-35 Lightning II aircraft major defense acquisition
program, in accordance with section 2430a of title 10, United States Code.
(b) Original Baseline- For purposes of reporting requirements referred to in section 2430a(b)
of title 10, United States Code, for the major subprogram designated under subsection (a),
the Secretary shall use the Milestone B decision as the original baseline for the subprogram.
(c) Actions Following Critical Cost Growth-
(1) IN GENERAL- Subject to paragraph (2), to the extent that the Secretary elects to
restructure the Lightning II aircraft major defense acquisition program subsequent to a
reassessment and actions required by subsections (a) and (c) of section 2433a of title 10,
United States Code, during fiscal year 2010, and also conducts such reassessment and
actions with respect to an F-35 engine development and procurement program (including
related reporting based on the original baseline as defined in subsection (c)), the
requirements of section 2433a of such title with respect to a major subprogram designated
under subsection (a) shall be considered to be met with respect to the major subprogram.
(2) LIMITATION- Actions taken in accordance with paragraph (1) shall be considered to
meet the requirements of section 2433a of title 10, United States Code, with respect to a
major subprogram designated under subsection (a) only to the extent that designation as a
major subprogram would require the Secretary of Defense to conduct a reassessment and
take actions pursuant to such section 2433a for such a subprogram upon enactment of this
Act. The requirements of such section 2433a shall not be considered to be met with respect
to such a subprogram in the event that additional programmatic changes, following the date
of the enactment of this Act, cause the program acquisition unit cost or procurement unit cost
of such a subprogram to increase by a percentage equal to or greater than the critical cost
growth threshold (as defined in section 2433(a)(5) of such title) for the subprogram.
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FY2011 Defense Appropriations Act
House
On July 27, 2010, the House Defense Appropriations Subcommittee reported out its markup of
the FY2011 Defense Appropriations Act. The subcommittee report included $450 million for the
F-35 alternate engine. The alternate engine funds were reportedly added by a vote of 11-5.82
The House Appropriations Committee did not report a separate defense bill for FY2011.
Senate
The Senate Appropriations Committee version of the FY2011 Defense Appropriations Act
included no funds for the F-35 alternate engine program.83 However, the report accompanying the
committee’s mark commented favorably on the program.84
Final Action
In lieu of a defense appropriations bill, the House and Senate passed a continuing resolution
maintaining spending at FY2010 levels.
82 John M. Donnelly, “House Panel OKs Funding for Second F-35 Engine Despite Veto Threat,” CQ Today, July 28,
2010.
83 Jennifer Scholtes, “Senate Panel Approves $669.9 Billion Defense Spending Bill With Few Changes,” CQ Today,
September 17, 2010.
84 Frank Olveiri, “Appropriators’ Report Blasts White House Request to Defund F136 Engine,” CQ Today, September
17, 2010.
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Appendix A. Prior-Year Legislative Activity
This appendix presents details from the legislative history of the F-35 alternate engine program
for the period FY1996-FY2010. The appendix focuses on presenting final bill language and
committee and conference report language. It omits bill language in House- or Senate-reported
versions of bills, as well as numerous instances in which committee or conference reports
recommended additional funding for the F-35 alternate engine program but did not otherwise
discuss the program in report language. The F-35 program was known in FY1996 and FY1997 as
the Joint Advanced Strike Technology (JAST) program.
FY1996
Defense Authorization Act (S. 1124/P.L. 104-106 of February 10, 1996)
Section 213 of S. 1124/P.L. 104-106 authorized funds for the JAST program, required DOD to
submit a report on the JAST program, and limited the obligation of JAST program funds until 30
days after the report is submitted. Subsection (b)(2) of Section 213 stated that $7 million of the
research and development funding authorized in the act “shall be available to provide for
competitive engine concepts” for the JAST program. Subsection (d) required a report on
requirements for the JAST program and other combat aircraft, and on certain planning
assumptions that affect those requirements.
The conference report (H.Rept. 104-450 of January 22, 1996) on S. 1124 discussed Section 213
on pages 705-707, stating in part:
The Senate report (S.Rept. 104-112) questioned whether the program could fulfill the needs
of the three services, and directed the Department to include two separate approaches in the
JAST program to reduce program risk. The Senate amendment directed the Secretary of the
Navy to:...
(2) evaluate at least two propulsion concepts from competing engine companies as part of
those demonstrations....
The conferees share the concerns expressed in the Senate report (S.Rept. 104-112) regarding
the lack of engine competition and the size of flying prototypes. The conferees direct the
Under Secretary of Defense (Acquisition & Technology) (USD (A&T)) to ensure that: (1)
the Department’s JAST program plan provides for adequate engine competition in the
program; and (2) the scale of the proposed demonstrator aircraft is consistent with both
adequately demonstrating JAST concepts and lowering the risk of entering engineering and
manufacturing development (EMD). The conferees direct the Secretary of Defense to include
in the report required by section 213(d) the Department’s plan for competitive engine
programs and demonstrator aircraft.
The conferees recommend authorization of funds reflecting these changes, and agree to a
provision (sec. 213) that would:...
(4) authorize $7.0 million for competitive engine concepts.
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The Senate Armed Services Committee report (S.Rept. 104-112 of July 12, 1995) on S. 1026, an
earlier version of the FY1996 defense authorization bill, discussed the JAST program on pages
95-97, stating in part:
Further, the committee believes supporting competitive propulsion programs would help
reduce risk and lead to higher confidence of achieving more affordable life cycle costs. The
committee fears that the current JAST approach may lead to selecting one power plant
manufacturer prematurely. Therefore, the committee directs the Secretary to evaluate at least
two propulsion concepts from competing engine companies as part of the full scale, full
thrust aircraft demonstrators. (Page 96)
DOD Appropriations Act (H.R. 2126/P.L. 104-61 of December 1, 1995)
The House Appropriations Committee report (H.Rept. 104-208 of July 27, 1995) on H.R. 2126
discussed the JAST program on page 150, stating in part:
The history of recent fighter engine propulsion plants demonstrates that development of new
engines is difficult. The Navy has generally been dissatisfied with the engine performance of
early model F–14s, and it eventually upgraded later model F–14s with an Air Force engine.
The Air Force in the late 1970s and early 1980s was dissatisfied with both the performance
and cost of engines on early models of the F–15 and the F–16, and it spent over a billion
dollars to bring a second engine manufacturer into a position where competition could be
conducted between two companies for future Air Force fighter aircraft. The new engine for
the F–22 has suffered technical problems and is undergoing a redesign.
The Joint Advanced Strike Technology (JAST) program envisions building a common
aircraft to satisfy the needs of the Air Force, Navy and Marine Corps for fighter aircraft in
the next century. Yet, it has selected a single power plant design, a derivative of the F–22
engine which has yet to be proven. Given the engine performance difficulties experienced
over the last two decades, this is unwise. To cede the manufacture of all jet engines for three
services’ future aircraft without any additional competition is not likely to be cost effective.
For these reasons, the Committee believes it is imperative for the JAST program to actively
pursue an engine design from a second manufacturer and has provided an additional
$20,000,000 only for this purpose.
FY1997
Defense Authorization Act (H.R. 3230/P.L. 104-201 of September 23, 1996)
The Senate Armed Services Committee report (S.Rept. 104-267 of May 13, 1996) on S. 1745, the
companion bill to H.R. 3230, discussed the JAST program on page 181, stating in part:
The committee is persuaded that the benefits of engine competition will outweigh any near-
term investment. Accordingly, the committee directs that remaining competition funds be
rebaselined to guarantee integration into the preferred weapons system concept at the earliest
practical point.
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DOD Appropriation Act (H.R. 3610/P.L. 104-208 of September 30, 1996)
H.R. 3610/P.L. 104-208 was an omnibus appropriations act that included the DOD appropriations
act. The House Appropriations Committee report (H.Rept. 104-617 of June 11, 1996) on H.R.
3610 discussed the JAST program on page 151, stating in part:
The Committee recommends $602,100,000, an increase of $13,000,000 in the Navy account
only to accelerate development of an alternate engine in order to have it available at the
beginning of the engineering and manufacturing development phase of the program. This
increase should be part of a program to develop a demonstrator engine and integrate it into
the selected weapon systems contractor concepts.
FY1998
Defense Authorization Act (H.R. 1119/P.L. 105-85 of November 18, 1997)
Section 213 of H.R. 1119/P.L. 105-85 states in part:
SEC. 213. JOINT STRIKE FIGHTER PROGRAM.
(a) REPORT.—Not later than February 15, 1998, the Secretary of Defense shall submit to
the congressional defense committees a report on the options for the sequence in which the
variants of the joint strike fighter are to be produced and fielded.
(b) CONTENT OF REPORT.—The report shall contain the following:...
(4) A certification that the Joint Strike Fighter Program contains sufficient funding to carry
out an alternate engine development program that includes flight qualification of an alternate
engine in a joint strike fighter airframe....
The House Armed Services Committee report (H.Rept. 105-132 of June 16, 1997) on H.R. 1119
discussed the JSF program on pages 189-190, 212, and 243. The discussion on pages 189-190
states in part:
The committee is also concerned that the 1997 FYDP does not reflect adequate funding
within the JSF program to continue development of the alternative fighter engine (AFE)
beyond the current demonstration/validation phase. The committee continues to believe that
a fully developed and flight tested AFE is essential to reduce risk to the JSF program and to
provide credible competition necessary for controlling program cost. Therefore, the
committee directs the Secretary of Defense to provide a report to the Congressional defense
committees no later than February 15, 1998, detailing the level of funding within the JSF
program that is identified to fund full development and flight test of the AFE.
The Senate Armed Services Committee report (S.Rept. 105-29 of June 17, 1997) on S. 924, the
companion bill to H.R. 1119, discussed the JSF program on pages 119-120, stating in part:
The budget request included funds for the continuation of a program to establish an
alternative engine for the joint strike fighter, but omitted funds for fiscal year 1998. The
committee is persuaded that there is a need for an alternative engine for the JSF, but expects
the Department to program sufficient funds in the future years for a robust, accelerated
profile. Accordingly, the committee recommends an increase in the budget request of $28.0
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million to accelerate the alternative engine program, with the understanding that the
Department will provide for the accelerated program in fiscal year 1999 and beyond.
FY1999
Defense Authorization Act (H.R. 3616/P.L. 105-261 of October 17, 1998)
The Senate Armed Services Committee report (S.Rept. 105-189 of May 11, 1998) on S. 2060, the
companion bill to H.R. 3616, discussed the JSF program on pages 168-169, stating in part:
Section 213 of the National Defense Authorization Act for Fiscal Year 1998 (Public Law
105–85) required a report on the order of fielding the variants of the JSF, and that
specifically addressed the acceleration of the naval variant. The report included a
certification that the JSF program contains sufficient funding to carry out an alternate engine
program that includes flight qualification of an alternate engine in a JSF airframe.
While not in total agreement with the report, the committee notes the timely submission and
clear presentation of the Department of Defense priorities and plans. The certification of a
funded program for an alternate engine is a positive commitment to cost-effective program
management. However, the actual demonstration of the alternate engine in a JSF airframe
has been continuously shifted to the ‘‘out years,’’ an action that threatens to invalidate the
whole initiative. If the alternate engine is not completed for use for the most stressing of the
JSF requirements (the short takeoff/vertical landing variant), then it may be too late to
provide a major benefit to the program. Accordingly, the committee recommends an increase
of $15.0 million to the budget request to accelerate the development of an alternative engine
for the JSF.
FY2000
Defense Authorization Act (S. 1059/P.L. 106-65 of October 5, 1999)
The House Armed Services Committee report (H.Rept. 106-162 of May 24, 1999) on H.R. 1401,
the companion bill to S. 1059, discussed the JSF program on pages 236-237, stating in part:
The committee continues its strong support for the development of an alternate engine to
ensure sustainment of critical industrial base capabilities, control of engine cost growth, and
reduction of risk to the reliability and maintainability of the planned fleet of 3,000 JSF
aircraft. The committee is concerned that while the Department now states a commitment to
development of an alternative engine for JSF, the planned funding levels outlined to sup port
that commitment do not enable cost-efficient and timely completion of the effort.
Meanwhile, the Department is also conducting other jet engine development efforts in PE
27268F as part of the aircraft engine CIP. The committee notes that requested funding for
this level of effort program has increased by $66.6 million, over 40 percent, from the level
projected for fiscal year 2000 just last year. The justification for the requested increase is to
reduce backlog of proposed engineering tasks for currently fielded engines. While supportive
of the CIP, the committee does not consider the proposed increase to this program to be of
higher priority than development of a new state-of-the-art alternative engine for JSF. The
committee notes that full development of a flight qualified jet engine also provides
opportunities to migrate proven new technologies to existing engines.
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Therefore, the committee recommends $130.2 million in PE 27268F, a decrease of $30.0
million, and $265.4 million in PE 63800F, an increase of $30.0 million, and directs that this
increase in JSF funding be used only for acceleration of alternate engine development.
The Senate Armed Services Committee report (S.Rept. 106-50 of May 17 [legislative day May
14], 1999) on S. 1059 discussed the JSF program on page 204, stating in part:
The budget request included $476.6 million ($241.2 million in Navy research and
development and $235.4 million in Air Force research and development) for continued
development of the joint strike fighter (JSF). Within that total, $33.0 million is included for
the alternate engine program. The committee remains concerned that development of an
alternate engine for the JSF will not proceed to a point where it represents a viable
alternative and reduces risk for the vertical and short take off and landing (V/STOL) JSF
variant. The committee recommends an additional $15.0 million in PE 63800F to reduce risk
and accelerate development of the alternate engine, a total Air Force authorization of $250.4
million.
FY2001
Defense Authorization Act (H.R. 4205/P.L. 106-398 of October 30, 2000) 85
The conference report (H.Rept. 106-945 of October 6, 2000) on H.R. 4205 discussed the JSF
program on pages 677-678, stating in part:
The conferees are also concerned about the apparent pattern of additional contractor funding
required to sustain the current DEMVAL activities of the program. Since the JSF program is
potentially one of the largest acquisition programs in the Department of Defense, both
competing contractors in this winner-take-all competition realize the significance of winner
selection. However, the conferees are opposed to the requirement for industry to make
additional, unreimbursed investments in the JSF program beyond existing contractual
agreements. The conferees view the additional DEMVAL funding as necessary to provide
for the execution of those projects presented in the budget request on the extended schedule.
The conferees expect that risk mitigation projects, including the alternate engine, will be
funded to the levels presented in the budget request.
The House Armed Services Committee report (H.Rept. 106-616 of May 12, 2000) on H.R. 4205
discussed the JSF program on pages 252-253, stating in part:
Additionally, while the Department is currently reviewing the planned JSF “winner take all”
strategy to ensure that aircraft industrial base concerns are addressed, the committee notes
that no specific concern has been stated with respect to the future stability of the fighter
aircraft engine industrial base. The committee supports continuation of the JSF alternate
engine program (AEP) as directed in section 211 [sic: 213] of the National Defense
Authorization Act for Fiscal Year 1998 (P.L. 105–85) and recommends that the Department
specifically address measures to ensure the health of the fighter aircraft engine industrial
base in any proposed restructure of the acquisition program for JSF.
85 H.R. 5408, the FY2001 defense authorization act, is incorporated in H.Rept. 106-945, the conference report on H.R.
4205. The text of H.R. 5408 is included in the conference report.
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The committee also notes that the JSF AEP, as currently funded, will not be capable of
completing development and flight qualification of the alternate engine until after award of
lot five of the JSF production program. In order to reduce risk to JSF production and aircraft
fielding, the Committee supports acceleration of AEP development to ensure that the
alternative engine completes configuration compatibility for the JSF airframe.
The committee recommends $299.5 million in PE 64800F, $131.6 million in PE 63800N,
and $296.0 million in PE 64800N, the requested amounts. The committee also recommends
$144.5 million in PE 63800F, an increase of $15.0 million, to accelerate the JSF AEP.
DOD Appropriations Act (H.R. 4576/P.L. 106-259 of August 9, 2000)
The Senate Appropriations Committee report (S.Rept. 106-298 of May 18, 2000) on S. 2593, the
companion bill to H.R. 4576, discussed the JSF program on pages 116-177, stating in part:
The Committee also continues to support the Alternate Engine Program (AEP) for JSF and
expects that the recommended changes in overall JSF funding will not impact the current
AEP schedule and that no funds will be diverted from the existing AEP plan.
FY2002
Defense Authorization Act (S. 1438/P.L. 107-107 of December 28, 2001)
The conference report (H.Rept. 107-333 of December 12, 2001) on S. 1438 discusses the JSF
program on page 574, stating in part:
The conferees remain concerned about the technical risks associated with the JSF aircraft
engine and expect the Department to develop and integrate the JSF alternate engine within
the EMD program. The conferees believe that the Department should execute the alternate
engine program with a goal of having that engine integrated into the JSF prior to full rate
production.
The House Armed Services Committee report (H.Rept. 107-194 of September 4, 2001) on H.R.
2586, the companion bill to S. 1438, discussed the JSF alternate engine program on page 220,
stating:
The budget request contained $769.5 million in PE 64800F to begin the engineering and
manufacturing development phase of the JSF program, but included no funds to reduce
development schedule risk of the alternate engine common hardware components.
The JSF program will develop and field a family of aircraft that meets the needs of the Navy,
Air Force, Marine Corps, and allies with commonality among the variants to minimize life
cycle costs. The committee notes that the JSF joint program office (JPO) has encouraged two
engine manufacturers to work together on the co-development of propulsion components
which are common to both the JSF’s current F-119 engine and the F-120 alternate engine86
and understands that this effort will develop two interchangeable propulsion systems while
preserving the proprietary interests of each manufacturer. The committee also understands
86 These were earlier designations for the F135 and F136 engines, respectively. The F135 engine is a derivative of the
F119 engine, which is the engine for the F-22 fighter.
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that the JPO supports production of the F-120 alternate engine as part of the low-rate initial
JSF production scheduled for fiscal year 2009 but believes that increased funding in fiscal
year 2002 is required to reduce development schedule risk of the common hardware
components.
Accordingly, the committee recommends $779.5 million in PE 64800F, an increase of $10.0
million, to reduce development schedule risk of the JSF alternate engine common hardware
components.
FY2003
DOD Appropriations Act (H.R. 5010/P.L. 107-248 of October 23, 2002)
The conference report (H.Rept. 107-732 of October 9, 2002) on H.R. 5010 states on page 279:
The conferees have included an additional $29,750,000 for the Joint Strike Fighter
Interchangeable Engine Program only to continue the current effort to develop and maintain
two, competing, interchangeable engine programs for the Joint Strike Fighter.
FY2004
Defense Authorization Act (H.R. 1588/P.L. 108-136 of November 24, 2003)
The SENATE ARMED SERVICES COMMITTEE report (S.Rept. 108-46 of May 13, 2003) on S.
1050, the companion bill to H.R. 1588, notes on page 4 the recommendation for $56 million in
additional funding for the JSF program. The report discussed the JSF program on page 185,
stating in part:
The committee believes that the interchangeable engine should be made available for
competitive procurement as early as possible. The result of a reduction to this program
would be to delay the interchangeable engine by at least two years.
Therefore, the committee recommends an increase of $56.0 million in PE 64800N to
continue the F136 interchangeable engine development on its original schedule. The
committee believes that the Department of Defense should make the financial adjustments to
the Future Years Defense Program that are necessary to restore the original interchangeable
engine schedule.
DOD Appropriations Act (H.R. 2658/P.L. 108-87 of September 30, 2003)
The Senate Appropriations Committee report (S.Rept. 108-87 of July 10, 2003) on S. 1382, the
companion bill to H.R. 2658 discussed the JSF program on page 157, stating:
The Committee is dismayed that the Joint Strike Fighter program office was permitted to
take a reduction for inflation savings disproportionately against the F136 Interchangeable
Engine. This cut resulted in a $56,000,000 reduction to this engine’s research and
development effort in fiscal year 2004.
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The Committee has been supportive of this engine development program for several years
and has, in fact, increased funding to accelerate this engine’s development. This cut to the
program flies in the face of long-standing Committee support.
The Committee, therefore, recommends a total cut of $56,000,000 to the Joint Strike Fighter
program which is to be taken equally from the Navy and the Air Force Joint Strike Fighter
programs with the exception of the F136 engine program. The Committee also recommends
that the fiscal year 2004 cut to the F136 Interchangeable Engine be restored to the original
program with an appropriate adjustment for the inflation cut.
Finally, the Committee has added $20,000,000 to this program only for risk reduction to the
F136 Interchangeable Engine program.
FY2005
Defense Authorization Act (H.R. 4200/P.L. 108-375 of October 28, 2004)
The House Armed Services Committee report (H.Rept. 108-491 of May 14, 2004) on H.R. 4200
discussed the JSF program on page 183, stating in part:
In order to maintain competition for the engine for the JSF, Congress has mandated the
funding of an alternate engine program and the JSF Joint Program Office (JPO) is working
with the contractor propulsion teams to provide for completely interchangeable engines.
The committee believes that the earliest possible engine production lot competition is
beneficial to the JSF program. The committee directs the JSF JPO plan to compete, at the
earliest possible date, engine common hardware as well as the turbomachinery, while
maintaining PW F135 and GE F136 engine interchangeability.
FY2006
Defense Authorization Act (H.R. 1815/P.L. 109-163 of January 6, 2006)
The House Armed Services Committee report (H.Rept. 109-89 of May 20, 2005) on H.R. 1815
discussed the JSF program on pages 92-93, stating in part:
Additionally, the committee understands that during the preparation of the fiscal year 2006
budget request that there were efforts by some within the military services to eliminate
planned budgets for the JSF competitive engine development program. Despite those views,
the committee also understands that the Secretary of Defense ensured that the engine
program was nominally funded. The committee believes that a two-engine source for the
single-engine JSF would be the most cost effective and operationally effective engine
solution during the JSF’s service life, and therefore expects that the Secretary, along with
Department of the Navy and the Department of the Air Force, will remain committed to the
development of competitive engines for the JSF.
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FY2007
Defense Authorization Act (H.R. 5122/P.L. 109-364 of October 17, 2006)
Section 211 of H.R. 5122/P.L. 109-364 states:
SEC. 211. ACQUISITION OF, AND INDEPENDENT COST ANALYSES FOR, THE
JOINT STRIKE FIGHTER PROPULSION SYSTEM.
(a) ACQUISITION.—
(1) IN GENERAL.—The Secretary of Defense shall provide for the development and
procurement of the propulsion system for the Joint Strike Fighter aircraft through the
continued development and sustainment of two interchangeable propulsion systems for that
aircraft by two separate contractors throughout the life cycle of the aircraft.
(2) MODIFICATIONS PROHIBITED.—Except as provided by paragraph (3), the Secretary
may not carry out any modification to the acquisition program for the Joint Strike Fighter
aircraft that would result in the development or procurement of the propulsion system for
that aircraft in a manner other than that required by paragraph (1).
(3) MODIFICATIONS ALLOWED.—Notwithstanding paragraph (1), a modification
described in paragraph (2) may be carried out to the extent that each of the following
requirements is met:
(A) The Secretary of Defense has notified the congressional defense committees of the
modification.
(B) Each of the reports required by subsection (b) has been submitted.
(C) Funds are appropriated for that purpose pursuant to an authorization of appropriations.
(b) INDEPENDENT COST ANALYSES.—
(1) IN GENERAL.—A comprehensive and detailed cost analysis of the Joint Strike Fighter
engine program shall be independently performed by each of the following:
(A) The Comptroller General.
(B) A federally funded research and development center selected by the Secretary of
Defense.
(C) The Secretary of Defense, acting through the Cost Analysis Improvement Group of the
Office of the Secretary of Defense.
(2) MATTERS COVERED.—Each such cost analysis shall cover—
(A) an alternative under which the Joint Strike Fighter aircraft is capable of using the F135
engine only;
(B) an alternative under which the program executes a one-time firm-fixed price contract for
a selected propulsion system for the Joint Strike Fighter aircraft for the life cycle of the
aircraft following the Initial Service Release of the propulsion system in fiscal year 2008;
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(C) an alternative under which the Joint Strike Fighter aircraft is capable of using either the
F135 engine or the F136 engine, and the engine selection is carried out on a competitive
basis; and
(D) any other alternative, whether competitive or sole source, that would reduce total life-
cycle cost, improve program schedule, or both.
(3) REPORTS.—Not later than March 15, 2007, the Secretary of Defense, the Comptroller
General, and the chief executive officer of the federally funded research and development
center selected under paragraph (1)(B) shall independently submit to the congressional
defense committees a report on the cost analysis carried out under paragraph (1). Each such
report shall include each of the following matters:
(A) The key assumptions used in carrying out the cost analysis.
(B) The methodology and techniques used in carrying out the cost analysis.
(C) For each alternative required by paragraph (2)—
(i) a comparison of the life-cycle costs, including costs in current and constant dollars and a
net-present-value analysis;
(ii) estimates of—
(I) supply, maintenance, and other operations manpower required to support the alternative;
(II) the number of flight hours required to achieve engine maturity and the year in which that
is expected to be achieved; and
(III) the total number of engines expected to be procured over the lifetime of the Joint Strike
Fighter program; and
(iii) an evaluation of benefits, other than cost, provided by competition, to include an
assessment of improved performance, operational readiness and warfighting capability, risk
reduction, technology innovation, and contractor responsiveness.
(D) A description of the acquisition strategies (including development and production) that
were used for, and experience with respect to cost, schedule, and performance under, past
acquisition programs for engines for tactical fighter aircraft, including the F–15, F–16, F–18,
and F–22 aircraft.
(E) A comparison of the experiences under past acquisition programs carried out on a sole-
source basis with respect to performance, savings, maintainability, reliability, and technical
innovation.
(F) The impact that canceling the F136 competitive engine would have on the high-
performance military engine industrial base, and on the Department of Defense’s ability to
make competitive engine choices for future combat aircraft systems beyond the Joint Strike
Fighter.
(G) Conclusions and recommendations.
(4) CERTIFICATIONS.—In submitting the report required by paragraph (3), the
Comptroller General and the chief executive officer of the federally funded research and
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development center shall also submit a certification as to whether the Secretary of Defense
provided access to sufficient information to enable the Comptroller General or the chief
executive officer, as the case may be, to make informed judgments on the matters required to
be included in the report.
(c) LIFE-CYCLE COSTS DEFINED.—In this section, the term ‘‘lifecycle costs’’
includes—
(1) those elements of cost that would be considered for a life-cycle cost analysis for a major
defense acquisition program, including procurement of engines, procurement of spare
engines, and procurement of engine components and parts; and (2) good-faith estimates of
routine engine costs (such as performance upgrades and component improvement) that
historically have occurred in tactical fighter engine programs.
The House Armed Services Committee report (H.Rept. 109-452 of May 5, 2006) on H.R. 5122
discussed the JSF program on pages 105-106 and 220-221. The discussion on pages 220-221
states in part:
The budget request contained $2.0 billion in PE 64800F for the Department of the Air
Force’s development of the joint strike fighter (JSF), also known as the F–35, but included
no funds for research and development of a second aircraft tire source for the JSF and other
existing combat aircraft, or for development of an alternate JSF engine. The committee notes
that the budget request also includes $2.0 billion in PE 64800N for the Department of the
Navy’s development of JSF....
The JSF alternate engine program is developing the F136 engine which would provide an
alternative to the currently-planned F135 engine. In the committee report (H.Rept. 109-89)
accompanying the National Defense Authorization Report for Fiscal Year 2006, the
committee expressed its belief that a two-engine source for the single-engine JSF would be
the most cost effective and operationally effective engine solution during the JSF’s service
life, and is disappointed that the budget request did not include funds for development of an
alternate JSF engine beyond fiscal year 2006. During a hearing held by the Subcommittee on
Tactical Air and Land Forces on March 16, 2006, the Under Secretary of Defense for
Acquisition, Technology, and Logistics testified, ‘‘While the benefits of a second supplier
are undeniable, our judgment is that those benefits are not worth the substantial financial cost
of a second supplier.’’ To confirm those judgments, the committee requested that the
Government Accountability Office (GAO) witness at the hearing review and report on the
Department of Defense’s analysis that resulted in the judgment to terminate the JSF alternate
engine program. On April 12, 2006, the GAO witness reported to the committee that the
‘‘Department of Defense’s quantitative analysis focuses only on potential savings for engine
acquisition and does not appear to fully examine potential savings that may be possible when
competition exists for providing support for maintenance and operations over the lifecycle of
the engine.’’ The committee concurs with GAO’s observation, and believes that the JSF
alternate engine program should continue until the Department of Defense fully analyzes
potential costs and savings resulting from competition over the JSF engine’s lifecycle.
Accordingly, the committee recommends an increase of $408.0 million to continue the JSF
alternate engine program for fiscal year 2007. Additionally, the committee recommends a
provision (section 211) that would require that the Department of the Navy and the
Department of the Air Force obligate not less than $408.0 million, of the funds authorized to
be appropriated for the system development and demonstration program for the Joint Strike
Fighter, for continued development of an alternate engine for the Joint Strike Fighter. The
committee also recommends a provision (section 215) that would require both the Secretary
of Defense, acting through the Department of Defense Cost Analysis Improvement Group,
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and the Comptroller General to conduct independent analyses of the JSF alternate engine
program and provide a report to the congressional defense committees by March 15, 2007.
The Senate Armed Services Committee report (S.Rept. 109-254 of May 9, 2006) on S. 2766, the
companion bill to 5122, states on page 6:
In order to confront irregular warfare threats, the Department must modernize and transform
the armed forces. Since 2001, the Department has undergone significant modernization and
transformation even during a time of war. The committee supported the Department’s
transformational activities, including authorizing funds for the construction of eight ships,
for a total of $12.1 billion; including a provision to promote coordinated joint development,
procurement, and operation of unmanned systems; adding funds for the continued
development of the Joint Strike Fighter interchangeable engine during fiscal year 2007;
authorizing the budget request of $3.7 billion for the Army’s Future Combat Systems
program; and authorizing an increase of nearly $365.0 million over the President’s budget
request of $11.1 billion for science and technology programs.
The report states on page 7:
Increasingly, the committee has emphasized the importance of developing capabilities to
plan and conduct coalition operations. Ten years ago, the committee expressed concerns
regarding the lack of engine competition in the Joint Strike Fighter program. As a result, the
committee included a provision in the National Defense Authorization Act for Fiscal Year
1996 (Public Law 104–106) that directed the Secretary of Defense to evaluate at least two
propulsion concepts from competing engine companies. Recently, the committee held
hearings to review the Department’s unilateral proposal, despite legislative direction to
maintain a two-engine program, to eliminate the development of the F136 alternate
interchangeable engine from the Joint Strike Fighter program. The committee remains
concerned that relying on one engine provider to perform multiple missions, for multiple
services and multiple nations presents an unnecessary operational and financial risk to the
United States. Accordingly, the committee authorized provisions adding $400.8 million for
the continued development of the interchangeable engine during fiscal year 2007; and
directing the Secretary of Defense to continue the development and sustainment of the Joint
Strike Fighter program with two competitive propulsion systems throughout the life of the
aircraft or enter into a one-time, firm-fixed-price contract for a single propulsion system
throughout the life of the aircraft.
The report discussed two proposed legislative provisions on pages 129-131, stating:
Development of the propulsion system for the Joint Strike Fighter (sec. 254)
The committee recommends a provision that would direct the Secretary of Defense to
continue the development and sustainment of the Joint Strike Fighter (JSF) program with
two competitive propulsion systems throughout the life cycle of the aircraft, or enter into a
one-time firm-fixed-price contract for a selected propulsion system for the life cycle of the
aircraft following the initial service release of the JSF F135 propulsion system in fiscal year
2008.
During the 1970’s and early 1980’s, Pratt & Whitney was the sole source provider of engines
for the F–14, F–15, and F–16 aircraft. Because of persistent engine problems that resulted in
the loss of aircraft and degraded readiness, Congress directed the Department of Defense to
develop and produce an engine to compete with Pratt & Whitney engines on these aircraft.
The benefits that resulted from this competition included improved performance, reduced
risk, increased readiness, lower cost of ownership, improved contractor responsiveness to
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customer needs, and over $4.0 billion of cost savings. Congress once again directed the
Department to provide for an engine competition for the JSF in 1996 out of concerns for a
lack of competition expressed in the National Defense Authorization Act for Fiscal Year
1996 (P.L. 104–106). Congress has consistently supported a competitive engine program for
the Joint Strike Fighter for the past 10 years.
The JSF program is the largest acquisition program, in terms of funding, in Department of
Defense history. Total JSF deliveries may well exceed 4,000 aircraft worldwide, with a
resultant level of propulsion business in the tens of billions of dollars. The committee is
concerned that relying on a sole engine supplier for a single-engine aircraft to do multiple
missions for multiple services and multiple nations presents an unnecessary operational and
financial risk to our nation.
The committee is also concerned that the Department’s analysis provided to the committee,
as justification for the termination of the F136 interchangeable engine, accounted for only 30
percent of the engine costs over the life cycle of the aircraft and failed to comply with the
Department’s policy on economic analysis that would have required the inclusion of the total
life cycle cost. If the Department had conducted a full life cycle analysis, the committee
believes that the results of the analysis would show significant cost savings that could be
achieved through a competitive engine strategy. The committee believes that through the
enduring value of competition, sufficient savings will be generated from a series of
competitive engine procurements over the life cycle of the aircraft that will more than offset
the cost of completing the F136 engine development. In order to ensure that the Congress has
the complete picture of the full life cycle costs, the committee has recommended another
provision described elsewhere in this report that would require the Secretary of Defense and
the Comptroller General to conduct independent life cycle cost analyses addressing this
issue.
Independent cost analyses for Joint Strike Fighter engine program (sec. 255)
The committee recommends a provision that would direct the Secretary of Defense, a
federally-funded research and development center (FFRDC) chosen by the Secretary, and the
Comptroller General to conduct independent life cycle cost analyses of the development and
sustainment of the Joint Strike Fighter (JSF) program with two competitive propulsion
systems throughout the life cycle of the aircraft, versus terminating the alternate engine
development and proceeding with only one engine.
The provision would also require that the Comptroller and the FFRDC certify that they had
access to sufficient information upon which to make informed judgments on the life cycle
costs of the two alternatives.
As noted elsewhere in this report, the committee is concerned that the Department of
Defense analysis provided as justification for the termination of the F136 interchangeable
engine did not account for all of the costs over the life cycle of the aircraft.
The report discussed the JSF program on pages 95-96 and 179. The discussion on page 179
states:
F136 Interchangeable Engine
The budget request included $1,999.0 million in PE 64800F and $2,031.0 million in PE
64800N for the continued development of the Joint Strike Fighter, but included no funding
for the development of the F136 interchangeable engine. The committee believes supporting
competitive propulsion systems would help reduce operational risk and lead to higher
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confidence of achieving more affordable life cycle costs. The committee expects that the
Secretary of Defense, along with the Department of the Navy and the Department of the Air
Force, will remain committed to the development and sustainment of competitive propulsion
systems for the Joint Strike Fighter.
The committee recommends an increase of $200.4 million in PE 64800F and an increase of
$200.4 million in PE 64800N for the continued development of the F136 interchangeable
engine.
DOD Appropriations Act (H.R. 5631/P.L. 109-289 of September 29, 2006)
The conference report (H.Rept. 109-676 of September 25, 2006) on H.R. 5631 discussed the JSF
program on pages 205 and 228. The discussion on pages 228 states:
The conferees recommend an additional $170,000,000 in Research, Development, Test and
Evaluation, Air Force and $170,000,000 in Research, Development, Test and Evaluation,
Navy for continuing development of the F–136 engine for the Joint Strike Fighter program.
The conferees direct the Under Secretary of Defense for Acquisition, Technology and
Logistics to sponsor a comprehensive independent cost analysis of the Joint Strike Fighter
engine program. The conferees strongly encourage the analysis be conducted by the Institute
for Defense Analyses (IDA). This analysis shall include but not be limited to: (1) a
comparison of costs associated with the development of the F–135 and F–136 engines; (2) an
evaluation of potential savings achieved by eliminating or continuing the development and
production of an alternate engine over the program’s life cycle; and (3) the potential effects
on the industrial base of eliminating or continuing the development and production of an
alternate engine over the program’s life cycle. This analysis shall be transmitted to the
congressional defense committees not later than March 15, 2007.
The conferees in no way intend for this analysis to be an excuse for the Department of
Defense not to fully fund the development of both the F–135 and the F–136 engines in fiscal
year 2008. All evidence suggests that the development of two alternate engines will lead to
cost savings through competition, increased capabilities for the warfighter, and a
strengthened industrial base. Accordingly, the conferees direct the Department of Defense to
fund the continued development of both the engines in the fiscal year 2008 budget
submission while this cost analysis is ongoing.
The House Appropriations Committee report (H.Rept. 109-504 of June 16, 2006) on H.R. 5631
discusses the JSF program on page 163 and 266. The discussion on page 266 states:
The budget request provided no funding for development of the F–136 engine for the Joint
Strike Fighter program. The Committee recommends an additional $200,000,000 for
continued development of this alternate engine source. The Committee directs the Under
Secretary of Defense for Acquisition, Technology and Logistics to sponsor a comprehensive
independent cost analysis of the Joint Strike Fighter engine program to be conducted by a
federally funded research and development center (FFRDC) with demonstrated competence
in this area. This analysis shall include but not be limited to: (1) a comparison of costs
associated with the development of the F–135 and F–136 engines; (2) an evaluation of
potential savings achieved by eliminating or continuing the development and production of
an alternate engine over the program’s life cycle; and (3) the potential effects on the
industrial base of eliminating or continuing the development and production of an alternate
engine over the program’s life cycle. This analysis shall be transmitted to the congressional
defense committees not later than March 15, 2007.
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The Committee is supportive of required studies included in the House-passed version of the
National Defense Authorization Act, 2007, and intends that this cost analysis be
complementary to those studies.
The Senate Appropriations Committee report (S.Rept. 109-292 of July 25, 2006) on H.R. 5631
discusses the JSF program on pages 76-77 and 157. The discussion on page 157 states:
The Committee is disappointed that the Department of Defense did not include funding for
the F–35 Joint Strike Fighter 2nd Engine Source in the fiscal year 2007 budget request.
Although the Committee recognizes that the Department of Defense faces difficult budget
challenges, the Committee also believes it is premature to cancel the second engine source.
Experience with the F–16 Fighter program engine competition led to a more reliable, better
performing and lower cost engine. The Committee believes that competition for the F–35
engine is critical to procuring the best value engine at the lowest price and that competition
will likely lead to an overall savings across the life cycle of the fighter program. Therefore,
the Committee recommends an additional $170,000,000 to each of the Navy and Air Force
Research, Development, Test and Evaluation accounts. The Committee also directs the
Department of Defense to fund the continued development of both engines in future budget
submissions.
FY2008
Section 213 of H.R. 4986/P.L. 110-181 states:
SEC. 213. REQUIREMENT TO OBLIGATE AND EXPEND FUNDS FOR
DEVELOPMENT AND PROCUREMENT OF A COMPETITIVE PROPULSION
SYSTEM FOR THE JOINT STRIKE FIGHTER.
Of the funds appropriated pursuant to an authorization of appropriations or otherwise made
available for fiscal year 2008 or any year thereafter, for research, development, test, and
evaluation and procurement for the Joint Strike Fighter Program, the Secretary of Defense
shall ensure the obligation and expenditure in each such fiscal year of sufficient annual
amounts for the continued development and procurement of 2 options for the propulsion
system for the Joint Strike Fighter in order to ensure the development and competitive
production for the propulsion system for the Joint Strike Fighter.87
H.R. 4986 is a revised version of H.R. 1585, which was vetoed on December 12, 2007. The
House Armed Services Committee report (H.Rept. 110-146 of May 11, 2007) on H.R. 1585
discussed the JSF program on pages 213-214, stating:
The budget request contained $1.8 billion in PE 64800F, and $1.7 billion in PE 64800N, for
development of the Joint Strike Fighter (JSF), but contained no funds for development of a
competitive JSF propulsion system.
The competitive JSF propulsion system program is developing the F136 engine, which
would provide a competitive alternative to the currently-planned F135 engine. In the
committee report (H. Rept. 109–452) accompanying the National Defense Authorization Act
for Fiscal Year 2007, the committee recommended an increase for the JSF competitive
propulsion system, and notes that the other three congressional defense committees also
87 In the conference report (H.Rept. 110-477 of December 6, 2007) on H.R. 1585, the text of section 213 reads “two
options” rather than “2 options.”
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recommended increases for this purpose. Section 211 of the John Warner National Defense
Authorization Act for Fiscal Year 2007 (Public Law 109–364) required that the Secretary of
Defense, acting through the Department of Defense Cost Analysis Improvement Group, the
Comptroller General, and a federally funded research and development center each provide
an independent lifecycle cost analysis of the JSF propulsion system, which would include a
competitive engine program by March 15, 2007. On March 22, 2007, the Subcommittees on
Air and Land Forces and Seapower and Expeditionary Forces held a hearing, which included
witnesses from the Department of Defense, the Institute for Defense Analyses, and the
Government Accountability Office (GAO), to receive testimony regarding their findings on
the JSF propulsion system. The committee believes the results of these studies were, in the
aggregate, inconclusive on whether there would be a financial benefit to the Department in
continuing to develop a competitive propulsion system for the JSF program. However, the
committee notes that all studies identified significant non-financial factors of a two-engine
competitive program, which include: better engine performance; improved contractor
responsiveness; a more robust industrial base; increased engine reliability; and improved
operational readiness. The committee believes that the benefits, which could be derived from
the non-financial factors, favor continuing the JSF competitive propulsion system program,
and recommends an increase of $480.0 million for this purpose.
The committee recommends $1.8 billion in PE 64800N, an increase of $115.0 million, and
directs that $240.0 million of the recommended funds be used for the competitive JSF
propulsion system program; and $1.9 billion in PE 64800F, an increase of $115.0 million,
and directs that $240.0 of the recommended funds be used for the competitive JSF
propulsion system program.
Additionally, the committee recommends a provision (section 213) that would require the
Secretary of Defense to obligate sufficient annual amounts to develop and procure a
competitive propulsion system for the JSF program, in order to conduct a competitive
propulsion source selection, from funds appropriated pursuant to an authorization of
appropriations or otherwise made available for research, development, test, and evaluation,
and procurement for the JSF program. The committee notes that current plans for the
competitive JSF propulsion system would complete the development of the competitive
propulsion system so that a competition for the JSF propulsion would occur in fiscal year
2012 with the sixth lot of low-rate initial production aircraft.
The Senate Armed Services Committee report (S.Rept. 110-77 of June 5, 2007) on S. 1547, the
companion bill to H.R. 1585, discussed a proposed legislative provision on pages 139-140,
stating:
The committee recommends a provision that would require the Secretary of Defense to
obligate sufficient annual amounts to develop and procure a competitive propulsion system
for the Joint Strike Fighter (JSF) program, in order to conduct a competitive propulsion
source selection, from funds appropriated pursuant to an authorization of appropriations or
otherwise made available for research, development, test, and evaluation, and procurement
for the JSF program. The committee notes that current plans for the competitive JSF
propulsion system would complete the development of the competitive propulsion system so
that a competition for the JSF propulsion system would occur in fiscal year 2012 with the
sixth lot of low-rate initial production.
The budget request contained $1.7 billion in PE 64800N, and $1.8 billion in PE 64800F for
development of the JSF, but contained no funds for development of a competitive JSF
propulsion system.
The competitive JSF propulsion system program is developing the F136 engine, which
would provide a competitive alternative to the current baseline F135 engine. Section 211 of
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the John Warner National Defense Authorization Act for Fiscal Year 2007 (Public Law 109–
364) required that, by March 15, 2007, the Secretary of Defense, acting through the
Department of Defense Cost Analysis Improvement Group, the Comptroller General, and a
federally funded research and development center, each provide an independent life cycle
cost analysis of the JSF propulsion system, which would include a competitive engine
program. The committee has been briefed on the results of these reviews and believes those
results were, in the aggregate, inconclusive on whether there would be a financial benefit to
the Department of Defense in continuing to develop a competitive propulsion system for the
JSF program.
However, the committee notes that all studies identified significant non-financial factors of a
two-engine competitive program that should be considered in deciding between the
alternatives. These factors include: better engine performance; improved contractor
responsiveness; a more robust industrial base; increased engine reliability; and improved
operational readiness. The committee believes that the potential benefits from the non-
financial factors favor continuing the JSF competitive propulsion system program.
Therefore, the committee recommends an increase of $480.0 million for this purpose,
including $240.0 million in PE 64800N, and $240.0 million in PE 64800F.
DOD Appropriations Act (H.R. 3222/P.L. 110-116 of November 13, 2007)
The House Appropriations Committee report (H.Rept. 110-279 of July 30, 2007) on H.R. 3222
discussed the JSF program on page 6, stating:
The success of the Department’s Joint Strike Fighter (F–35) program is critical to our
Nation’s ability to field a modern, capable fighter aircraft fleet for decades to come. To
maintain stability in this program—and limit the potential for cost increases over time—the
Committee recommends an increase of $200,000,000 for F–35 production enhancements.
These funds are to be used to outfit facilities with the latest in production line equipment and
work-flow technology. In addition, the Committee recommends including $480,000,000 to
continue development of an alternative engine for this aircraft, thereby ensuring a
competitive base for engine production.
The report discussed JSF the program again on pages 161-162, 211, and 360. The discussion on
page 360 states in part:
The fiscal year 2008 budget request includes no funding for development of the F–136 as an
alternate engine within the Joint Strike Fighter program. The Committee recommends
$480,000,000 for this effort. These funds have been added to the Air Force and Navy’s
respective Joint Strike Fighter development lines.
The statement of the managers accompanying the conference report on the Defense
Appropriations Act for fiscal year 2007 directed the Department of Defense to fund the
continued development of both the F–135 and F–136 engines in the fiscal year 2008 budget
request. The Committee notes that this direction was disregarded by the Office of the
Secretary of Defense. In exercising its power of the purse, the Committee made the
necessary program adjustments to the fiscal year 2008 budget request to fully fund the
requirement for this engine development program. The fiscal year 2009 requirement for the
F–136 is estimated to be $350,000,000. The Committee again directs the Department of
Defense to fully fund this development program in the fiscal year 2009 budget submission.
The Senate Appropriations Committee report (S.Rept. 110-155 of September 14, 2007) on H.R.
3222 discusses the JSF program on page 191, stating:
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The Committee is disappointed that the Department of Defense did not continue funding to
support the development of an alternative engine for the F–35 Joint Strike Fighter in the
fiscal year 2008 budget request. Although the Committee recognizes that the Department of
Defense faces difficult budget challenges, the Committee also believes it is premature to
cancel the second engine source. Experience with the F–16 Fighter program demonstrated
that engine competition led to a more reliable, better performing and lower cost engine. The
Committee believes that competition for the F–35 engine is critical to procuring the best
value engine at the lowest price and that competition will likely lead to an overall savings
across the life cycle of the fighter program. Therefore, the Committee recommends an
additional $240,000,000 in both the Navy and Air Force Research, Development, Test and
Evaluation accounts. The Committee also directs the Department of Defense to fund the
continued development of both engines in future budget submissions.
FY2009
Defense Authorization Act (S. 3001/P.L. 110-417 of October 14, 2008)
The House Armed Services report (H.Rept. 110-652 of May 16, 2008) on H.R. 5658, the
companion bill to S. 3001, discussed the JSF program on pages 227-228, stating:
The budget request contained $1.5 billion in PE 64800F, and $1.5 billion in PE 64800N, for
development of the Joint Strike Fighter (JSF), but contained no funds for development of a
competitive JSF propulsion system. The budget request also contained $136.9 million for F–
35 advance procurement in Aircraft Procurement, Air Force for the long-lead components
necessary to procure 12 F–35A aircraft in fiscal year 2010, but contained no funds for
advance procurement of competitive JSF propulsion system long-lead components.
The competitive JSF propulsion system program is developing the F136 engine, which
would provide a competitive alternative to the currently-planned F135 engine. In the
committee report (H.Rept. 109–452) accompanying the John Warner National Defense
Authorization Act for Fiscal Year 2007, and once again in the committee report (H. Rept.
110–146) accompanying the National Defense Authorization Act for Fiscal Year 2008, the
committee recommended increases for the JSF competitive propulsion system, and notes that
in both cases, the other three congressional defense committees concurred. Despite section
213 of the National Defense Authorization Act for Fiscal Year 2008 (Public Law 110–181),
which requires the Secretary of Defense to obligate and expend sufficient annual amounts for
the continued development and procurement of a competitive propulsion system for the JSF,
the committee is disappointed that the Department of Defense (DOD) chose not to comply
with both the spirit and intent of this provision by opting not to include funds for this
purpose in the budget request.
On March 11, 2008, the Subcommittees on Air and Land Forces and Seapower and
Expeditionary Forces held a hearing at which the Undersecretary of Defense for Acquisition,
Technology and Logistics (USD (AT&L)) and the Government Accountability Office’s
(GAO) Director of Acquisition Sourcing and Management testified. Witnesses were asked to
provide an update to the independent lifecycle cost analysis of the JSF propulsion system
required by section 211 of the John Warner National Defense Authorization Act for Fiscal
Year 2007 (Public Law 109–364) based on the obligation of an additional $480.0 million
authorized and appropriated for fiscal year 2008, performance of the competitive engine
program to date, and the additional year of development. The GAO Director of Acquisition
and Sourcing Management complied with the subcommittees’ request and testified that the
Department of Defense would recoup its initial investment costs with program savings of
between 9 and 11 percent, or about 1.3 percent less than the GAO reported in 2007. He also
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testified that at least that amount of savings could be achieved in the long run based on
analysis of actual data from the F–16 engine competition. Opting not to comply with the
committee request, the USD (AT&L) testified that the Department did not direct the Office
of the Secretary of Defense’s Cost Analysis and Improvement Group to update its analysis
from the previous year, and that there had been no significant changes to the program that
would have resulted in any changes to their findings. Based on this testimony, the committee
believes that a competitive propulsion system for the JSF offers the promise of long-term
savings.
The committee also notes that in August 2007, the currently planned F135 engine
experienced a hardware failure during test stand operations with the short take-off and
vertical land (STOVL) lift fan engaged, and that a similar failure occurred again in February
2008, and that these engine failure will result in a currently projected delay to the first flight
of the F–35 STOVL variant by 30 to 60 days. While the committee understands that the
F135 engine is still in development and test failures may occur, the committee believes that,
over the long-term, a competitive JSF propulsion program will result in improved engine
performance for all JSF variants. These test failure events and the subcommittees’ hearing
testimony cause the committee to remain steadfast in its belief that the non-financial factors
of a two-engine competitive program such as better engine performance, improved
contractor responsiveness, a more robust industrial base, increased engine reliability and
improved operational readiness strongly favor continuing the competitive propulsion system
program.
For continued development of the competitive JSF propulsion system program, the
committee recommends $1.8 billion, an increase of $247.5 million in PE 64800F, and $1.8
billion, an increase of $247.5 million in PE 64800N. The committee also recommends
$167.9 million, an increase of $31.0 million for advance procurement of competitive JSF
propulsion system long-lead components, for F–35 advance procurement in Aircraft
Procurement, Air Force. Additionally, the committee strongly urges the Department of
Defense to comply with the spirit and intent of section 213 of the National Defense
Authorization Act for Fiscal Year 2008 (Public Law 110–181) by including the funds
necessary for continued development and procurement of a competitive JSF propulsion
system in its fiscal year 2010 budget request.
The Senate Armed Services Committee report (S.Rept. 110-335 of May 12, 2008) on S. 3001
discussed the JSF program on pages 99-100, stating:
The budget request included $136.9 million in Aircraft Procurement, Air Force (APAF) for
advanced procurement for the F–35 Joint Strike Fighter (JSF) program. In section 213 of the
National Defense Authorization Act for Fiscal Year 2008 (Public Law 110–181), Congress
explicitly directed the Department of Defense to (1) develop a competitive propulsion system
for the JSF aircraft; and (2) continue competition for the propulsion system throughout the
production phase of the JSF program.
In order to follow through on that direction and begin competition with the F–135 engine in
2012, the Department of Defense must begin funding for long lead items for the F–136
production line in 2009.
Therefore, the committee recommends in increase of $35.0 million in APAF for long lead
items for the F–136 engine.
The report further discussed the JSF program on pages 123-124 and 197. The discussion on page
197 states:
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The budget request included $1,532.7 million in PE 64800N and $1,524.0 million in PE
64800F for the F–35 Joint Strike Fighter (JSF) program. In section 213 of the National
Defense Authorization Act for Fiscal Year 2008 (Public Law 110–181), Congress explicitly
directed the Department of Defense to (1) develop a competitive propulsion system for the
JSF aircraft; and (2) continue competition for the propulsion system throughout the
production phase of the JSF program.
The committee is disappointed that the administration chose to ignore the law by failing to
fund the competitive propulsion system. Accordingly, the committee recommends an
increase of $215.0 million in PE 64800N and $215.0 million in PE 64800F for development
of the F–35 JSF competitive propulsion system.
The report further discusses the JSF program on page 222, stating:
The budget request included $1,524.0 million in PE 64800F for the F–35 Joint Strike Fighter
(JSF) program. Over the past 2 years, Congress has added $820.0 million to continue
funding of the F136 engine, a competitive propulsion source, to ensure there is fair and full
competition for the propulsion system of the JSF.
The Department of Defense froze the technology baseline of the F135 engine several years
ago when the JSF and the engine began system development and demonstration (SDD). To
ensure that both engines incorporate the best configuration and most recent technology
available, the Department should invest in and direct a program for the F135 and F136
engine programs that would drive technology insertion and provide potential customers with
the best performing, most efficient engines possible. For example, the committee believes
that the potential application of new composite materials in the F135 engine program could
result in life cycle cost savings. Because no funds were set aside for the F136 engine in the
administration’s budget request, elsewhere in this report the committee has recommended an
increase of $430.0 million for the development of the F–136 engine.
In order to maintain a level playing field, the committee recommends an increase of $35.0
million in PE 64800F for F135 engine technology development.
Consolidated Appropriations Act (H.R. 2638/P.L. 110-329 of September 30,
2008)
The FY2009 DOD Appropriations Act is Division C of H.R. 2638/P.L. 110-329. In lieu of a
conference report for H.R. 2638, there was an explanatory statement that was printed as a House
Appropriations Committee print dated October 2008 (print 44-807). The committee print
discussed the JSF program on page 215, stating:
The FY2009 budget request included no funding for the continued development of the F–136
engine as an alternate engine within the Joint Strike Fighter program. The bill includes
$430,000,000 for the continued development of this engine within the Navy and Air Force’s Joint
Strike Fighter development programs and $35,000,000 for advance procurement items within the
Aircraft Procurement, Air Force appropriation. The Secretary of Defense is once again directed to
fully fund the F–136 engine development and procurement efforts in the FY2010 budget
submission.
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FY2010
FY2010 Defense Authorization Act (H.R. 2647/P.L. 111-84)
The conference report accompanying H.R. 2647 states:
F–35 and alternate propulsion system program
The Senate amendment contained a provision (sec. 211) that would: (1) increase in funding
for procurement of UH–1Y/AH–1Z rotary wing aircraft and for management reserves for the
F–35 Joint Strike Fighter program; and (2) prohibit the obligation of funds authorized to be
appropriated for development or procurement of an alternate propulsion system for the F–35
until the Secretary of Defense certifies in writing to the congressional defense committees
that development and procurement of the alternate propulsion system would: (a) reduce life
cycle costs of the F–35; (b) improve operational readiness of the fleet of F–35 aircraft; (c)
will not disrupt the F–35 research, development, test, and evaluation (RDT&E) and
procurement phases of the program; and (d) will not result in the procurement of fewer F–35
aircraft during the life cycle of the program.
The House bill contained a provision (sec. 218) that would limit obligations for the F–35
RDT&E program to 75 percent until 15 days after the later of the dates on which: (1) the
Under Secretary of Defense for Acquisition, Technology, and Logistics certifies in writing to
the congressional defense committees that all fiscal year 2010 funds for the F–35
competitive propulsion system have been obligated; (2) the Secretary of Defense submits the
report on F/A–18 multiyear procurement costs required by section 123 of the Duncan Hunter
National Defense Authorization Act for Fiscal Year 2009 (Public Law 110–417); and (3) the
Department submits the 30-year aircraft procurement plan required by section 231a of title
10, United States Code.
The House bill also contained a provision (sec. 242) that would require the Secretary of
Defense to include in annual budget requests submitted to the President, beginning in 2011,
such amounts as are necessary for the full funding of continued development and
procurement of a competitive propulsion system for the F–35.
Both the House and Senate recede from their respective provisions.
The conferees agree to authorize the budget request for 30 F–35 aircraft in Aircraft
Procurement, Navy, and Aircraft Procurement, Air Force. The conferees also agree to
authorize an increase of a total of $430.0 million in RDT&E, Navy, and RDT&E, Air Force
for continued F136 engine development; and $130.0 million in Aircraft Procurement, Air
Force, for F136 engine procurement. The conferees expect that the Secretary of Defense will
comply with the direction in section 213 of the National Defense Authorization Act for
Fiscal Year 2008 (Public Law 110–181), and ensure that sufficient annual amounts are
obligated and expended, in each fiscal year, for the continued development and procurement
of two options for the F–35 propulsion system in order to ensure the development and
competitive production of the F–35 propulsion system. (Pages 706-707)
The House Armed Services Committee’s report (H.Rept. 111-166 of June 18, 2009) on H.R. 2647
recommends the following:
• a net reduction of $122 million in Navy aircraft procurement funding for the
procurement of F-35Bs and Cs for the Marine Corps and Navy, consisting of a
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reduction of $164 million for the one-aircraft reduction and an addition of $42
million for the F136 alternate engine (page 57; line 006);
• an increase of $5 million in Navy aircraft advance procurement funding for the
F136 alternate engine (page 57, line 007);
• a decrease of $4 million in procurement funding for F-35 spares, and an increase
of $2 million in procurement funding for F136 spares (page 60, line 057);
• a net reduction of $67 million in Air Force procurement funding for the
procurement of F-35As for the Air Force, consisting of a reduction of $131
million for the one-aircraft reduction, a reduction of $9 million for F-35 initial
spares, an increase of $57 million for the F136 alternate engine, an increase of
$21 million for spares for the F136 alternate engine, and an increase of $129
million for F-35 spares and support equipment (page 93; line 001);
• an increase of $13 million in Air Force advance procurement funding for the
F136 alternate engine (page 93; line 002);
• a net increase of $153.5 million in Navy research and development funding for
the F-35 program, consisting of an increase of $231.5 million for the F136
alternate engine and a reduction of $78 million for “program excess” (page 169);
and
• a net increase of $153.5 million in Air Force research and development funding
for the F-35 program, consisting of an increase of $231.5 million for the F136
alternate engine and a reduction of $78 million for “program excess” (page 190).
H.R. 2647 contains two sections relating directly to the F-35 alternate program: Section 218,
which limits the obligation of FY2010 F-35 research and development funds until certain
conditions (including one related to the alternate engine program) are met, and Section 242,
which concerns the alternate engine program.
The texts of these two provisions appear below.
Section 218 states:
SEC. 218. LIMITATION ON OBLIGATION OF FUNDS FOR F-35 LIGHTNING II
PROGRAM.
Of the amounts authorized to be appropriated or otherwise made available for fiscal year
2010 for research, development, test, and evaluation for the F-35 Lightning II program, not
more than 75 percent may be obligated until the date that is 15 days after the later of the
following dates:
(1) The date on which the Under Secretary of Defense for Acquisition, Technology, and
Logistics submits to the congressional defense committees certification in writing that all
funds made available for fiscal year 2010 for the continued development and procurement of
a competitive propulsion system for the F-35 Lightning II have been obligated.
(2) The date on which the Secretary of Defense submits to the congressional defense
committees the report required by section 123 of the Duncan Hunter National Defense
Authorization Act for Fiscal Year 2009 (P.L. 110-417; 122 Stat. 4376).
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(3) The date on which the Secretary of Defense submits to the congressional defense
committees the annual plan and certification for fiscal year 2010 required by section 231a of
title 10, United States Code.
Section 242 states:
SEC. 242. INCLUSION IN ANNUAL BUDGET REQUEST AND FUTURE-YEARS
DEFENSE PROGRAM OF SUFFICIENT AMOUNTS FOR CONTINUED
DEVELOPMENT AND PROCUREMENT OF COMPETITIVE PROPULSION SYSTEM
FOR F-35 LIGHTNING II.
(a) Annual Budget- Chapter 9 of title 10, United States Code, is amended by adding at the
end the following new section:
‘Sec. 235. Budget for competitive propulsion system for F-35 Lightning II
‘(a) Annual Budget- Effective for the budget of the President submitted to Congress under
section 1105(a) of title 31, United States Code, for fiscal year 2011 and each fiscal year
thereafter, the Secretary of Defense shall include, in the materials submitted by the Secretary
to the President, a request for such amounts as are necessary for the full funding of the
continued development and procurement of a competitive propulsion system for the F-35
Lightning II.
‘(b) Future-Years Defense Program- In each future-years defense program submitted to
Congress under section 221 of this title, the Secretary of Defense shall ensure that the
estimated expenditures and proposed appropriations for the F-35 Lighting II, for each fiscal
year of the period covered by that program, include sufficient amounts for the full funding of
the continued development and procurement of a competitive propulsion system for the F-35
Lightning II.
‘(c) Requirement to Obligate and Expend Funds- Of the amounts authorized to be
appropriated for fiscal year 2010 or any year thereafter, for research, development, test, and
evaluation and procurement for the F-35 Lightning II Program, the Secretary of Defense
shall ensure the obligation and expenditure in each such fiscal year of sufficient annual
amounts for the continued development and procurement of two options for the propulsion
system for the F-35 Lightning II in order to ensure the development and competitive
production for the propulsion system for the F-35 Lightning II.’.
(b) Clerical Amendment- The table of sections at the beginning of such chapter is amended
by at the end the following new item:
‘235. Budget for competitive propulsion system for F-35 Lightning II.’.
(c) Conforming Repeal- The National Defense Authorization Act for Fiscal Year 2008 (P.L.
110-181) is amended by striking section 213.
Regarding Air Force research and development funding for the F-35 program, the House report
states:
The competitive F–35 propulsion system program is developing the F136 engine, which
would provide a competitive alternative to the currently-planned F135 engine. For the past
three years, in the committee report (H.Rept. 109-452) accompanying the John Warner
National Defense Authorization Act for Fiscal Year 2007, in the committee report (H.Rept.
110-146) accompanying the National Defense Authorization Act for Fiscal Year 2008, and
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in the committee report (H.Rept. 110-652) accompanying the Duncan Hunter National
Defense Authorization Act for Fiscal Year 2009, the committee recommended increases for
the F–35 competitive propulsion system, and notes that in all cases, the other three
congressional defense committees also recommended increases for this purpose. Despite
section 213 of the National Defense Authorization Act for Fiscal Year 2008 (Public Law
110–181), which requires the Secretary of Defense to obligate and expend sufficient annual
amounts for the continued development and procurement of a competitive propulsion system
for the F–35, the committee is disappointed that the Department of Defense (DOD) has, for
the third consecutive year, chosen not to comply with both the spirit and intent of this
provision by opting not to include funds for this purpose in the budget request.
The committee notes that the F135 engine development program has experienced cost
growth since the engineering and manufacturing development (EMD) program began in
fiscal year 2002. At the beginning of EMD in fiscal year 2002, the F135 engine development
program was expected to cost $4.828 billion in then-year dollars. The F–35 program
manager reports that as of the end of 2008, development costs have grown to $6.7 billion in
then-year dollars, an increase of $1.872 billion, or 38 percent. Additionally, the committee
notes that the F–35 program manager has reported an increase of approximately 38 to 43
percent in F135 engine procurement cost estimates between December 2005 and December
2008, in the annual selected acquisition reports for the F–35C and F–35A variants. Between
December 2005 and December 2008, engine procurement cost estimates for the F–35B have
grown approximately 47 percent, but the F–35B engine procurement cost growth is
attributable to both the F135 engine and the F–35B’s lift fan. Conversely, the F136 engine
program has not experienced any cost growth since its inception. The F136 pre-EMD
contract, which began in 2002 and was completed in 2004, was for $411.0 million and did
not experience cost growth. The F136 EMD contract was awarded in 2005, and the cost
estimate, at $2.486 billion, has been stable since contract award. Given the F135
development and procurement cost increases, the committee is perplexed by the
Department’s decisions over the past three years to not include an F–35 competitive
propulsion system program in its budget requests. Based on the F135 cost growth, F135 test
failures noted in the committee report (H.Rept. 110-652) accompanying the Duncan Hunter
National Defense Authorization Act for Fiscal Year 2009, and resultant schedule delays due
to F135 engine test failures, the committee remains steadfast in its belief that the non-
financial factors of a two-engine competitive program such as better engine performance,
improved contractor responsiveness, a more robust industrial base, increased engine
reliability and improved operational readiness, strongly favor continuing the F–35
competitive propulsion system program…
For continued development of the competitive F–35 propulsion system program, the
committee recommends a total increase of $463.0 million in PEs 64800F and 64800N as
noted in the tables elsewhere in this report. The committee also recommends an aggregate
increase of $140.0 million as noted in the tables elsewhere in this report in Aircraft
Procurement, Navy and Aircraft Procurement, Air Force for the procurement of four F136
engines, F136 spare parts, and advance procurement of F136 long-lead components to
continue F136 procurement in fiscal year 2011. (Pages 201-203)
A June 24, 2009, statement of administration policy on H.R. 2647 states the following regarding
the F-35 program:
F-35 Joint Strike Fighter Program: The Administration strongly objects to the addition of
$603 million for development and procurement of the alternative engine program, and the
requirement for the Department to fund the alternative engine program in future budget
requests to the President. These changes will delay the fielding of the Joint Strike Fighter
(JSF) capability and capacity, adversely impacting the Department’s overall strike fighter
inventory. In addition, the Administration objects to provisions of the bill that mandate an
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alternative engine program for the JSF. The current engine is performing well with more
than 11,000 test hours. Expenditures on a second engine are unnecessary and impede the
progress of the overall JSF program. Alleged risks of a fleet-wide grounding due to a single
engine are exaggerated. The Air Force currently has several fleets that operate on a single-
engine source. The Administration also objects to the limit on the obligation of overall JSF
development funding to 75% of the amount authorized until Department of Defense (DOD)
has obligated all funds provided in FY 2010 for the alternative engine program. If the final
bill presented to the President would seriously disrupt the F-35 program, the President’s
senior advisors would recommend a veto.88
In the FY2010 defense authorization bill (S. 1390) as reported by the Senate Armed Services
Committee (S.Rept. 111-35 of July 2, 2009), Division D presents committee’s detailed the line-
tem funding recommendations. Division D does the following:
• recommends a net increase of $141.45 million in Navy research and development
funding for the F-35 program, consisting of an increase of $219.45 million for
the F136 alternate engine and a reduction of $78 million for excess management
reserves (page 678); and
• recommends a net increase of $141.45 million in Air Force research and
development funding for the F-35 program, consisting of an increase of $219.45
million for the F136 alternate engine and a reduction of $78 million for excess
management reserves (page 687).
Section 211 of S. 1390 states:
SEC. 211. CONTINUED DEVELOPMENT OF COMPETITIVE PROPULSION SYSTEM
FOR THE JOINT STRIKE FIGHTER PROGRAM.
Of the amounts authorized to be appropriated or otherwise made available for fiscal year
2010 for research, development, test, and evaluation for the F-35 Lightning II aircraft
program, not more than 90 percent may be obligated until the Secretary of Defense submits
to the congressional defense committees a written certification that sufficient funds have
been obligated for fiscal year 2010 for the continued development of a competitive
propulsion system for the F-35 Lightning II aircraft to ensure that system development and
demonstration continues under the program during fiscal year 2010.
Regarding Section 211, the committee’s report states:
The committee recommends a provision that would require the Department to obligate
sufficient funds for fiscal year 2010 for the continued development and procurement of the
F136 competitive propulsion system for the F–35 Lightning II to ensure that the Department
continues the system development and demonstration (SDD) program during fiscal year
2010. The committee understands that current plans for the F136 Joint Strike Fighter (JSF)
propulsion system would complete the development in sufficient time to conduct a first
competitive contract award in fiscal year 2012, concurrent with the award for the sixth lot of
low-rate initial production aircraft.
88 Executive Office of the President, Office of Management and Budget, Statement of Administration Policy, H.R. 2647
- National Defense Authorization Act for Fiscal Year 2010, June 24, 2009, pp. 1-2. Emphasis as in the original.
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The budget request included $1,741.3 million in PE 64800N, and $1,858.1 million in PE
64800F for continued development of the JSF program, but included no funds for continuing
the SDD phase of the F136 program.
The committee continues to believe that, in light of studies performed by the Department of
Defense, the Institute for Defense Analyses, and the Government Accountability Office, it is
in the best interests of the Nation to continue the development of the F136. Though the
results of these studies were, in the aggregate, inconclusive on whether there would be a
financial benefit to the Department in continuing to develop a competitive propulsion system
for the JSF program, the committee notes that all studies identified significant non-financial
factors of a two-engine competitive program. These included better engine performance;
improved contractor responsiveness; a more robust industrial base; increased engine
reliability; and improved operational readiness. The committee believes that the benefits,
which could be derived from the non-financial factors, favor continuing the JSF competitive
propulsion system program.
Therefore, the committee recommends an increase of $438.9 million for continuing F136
SDD, with half that amount added to PE 64800N and the other half added to PE 64800F.
(Page 35)
The committee’s report states that the recommendation to include additional Navy and Air Force
research and development funding for the F-35 alternate engine was approved in full-committee
markup by a vote of 12–10, with the votes as follows: “In Favor: Senators Levin, Kennedy, Byrd,
Nelson of Florida, Bayh, Webb, McCaskill, Hagan, Begich, Thune, Wicker, and Vitter. Opposed:
Senators Lieberman, Reed, Akaka, Nelson of Nebraska, Udall of Colorado, Inhofe, Sessions,
Chambliss, Martinez, and Collins.” (Page 276)
Statement of Administration Policy
A July 15, 2009, statement of administration policy on S. 1390 states the following regarding the
F-35 program:
F-35 Joint Strike Fighter (JSF) Program: The Administration strongly objects to the addition
of $438.9 million for development of the alternative engine program. The Administration
also objects to provisions of the bill that mandate an alternative engine program for the JSF.
The current engine is performing well with more than 11,000 test hours. In addition, the risks
associated with a single engine provider are manageable as evidenced by the performance of
the F-22 and F/A-18E/F, Air Force and Navy programs supplied by a single engine provider.
Expenditures on a second engine are unnecessary and impede the progress of the overall JSF
program. The Air Force currently has several fleets that operate on a single-engine source.
The Administration also objects to the limit on the obligation of overall JSF development
funding to 90 percent of the amount authorized until the Secretary of Defense submits a
written certification that sufficient funds have been obligated in FY 2010 for the alternative
engine program. If the final bill presented to the President would seriously disrupt the F-35
program, the President’s senior advisors would recommend a veto.89
On July 23, 2009, as part of its consideration of S. 1390, the Senate rejected by a vote of 38 to 59
(Record Vote 240) an amendment (S.Amdt. 1767) that would have modified Section 211 as
reported by the Senate Armed Services Committee so as to preserve the additional research and
89 Executive Office of the President, Office of Management and Budget, Statement of Administration Policy, S. 1390—
National Defense Authorization Act for Fiscal Year 2010, July 15, 2009, pp. 1-2. Emphasis as in the original.
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development funding for the alternate engine program, but make that funding available through
an offset taken from a place in the defense budget other than what was recommended in the
Senate Armed Services Committee markup.
Following its rejection of S.Amdt. 1767, the Senate adopted by voice vote another amendment
(S.Amdt. 1627) that rewrites Section 211 so as to remove the research and development funding
that was added in committee markup for an alternate engine program. The amendment also
prohibits the obligation or expenditure of FY2010 funding on an alternate program until the
Secretary of Defense makes certain certifications regarding its cost effectiveness. As amended by
S.Amdt. 1627, S. 1390 is now generally consistent with the Administration’s proposal to
terminate the alternate engine program.
S.Amdt. 1767 would have:
• preserved the language from Sec. 211 as reported by the Senate Armed Services
Committee that would prohibit DOD from obligating more than 90% of FY2010
F-35 research and development funds until the Secretary of Defense submits to
the congressional defense committees a written certification that sufficient funds
have been obligated for FY2010 for the continued development of a competitive
propulsion system for the F-35 to ensure that system development and
demonstration continues under the program during FY2010;
• preserved the additional research and development funding for the alternate
engine program that was added in the Senate Armed Services Committee
markup;
• restored reductions to the UH-1Y/AH-1Z helicopter program and to F-35
program management reserves that were made so as to make available the
funding that was added for the alternate engine program; and
• instead reduced funding for the HC/MC-130 aircraft program—a program that
received $504 million in procurement funding in the FY2009 supplemental
appropriations act (H.R. 2346/P.L. 111-32 of June 24, 2009).90
The text of S.Amdt. 1767 is as follows:
SEC. 211. CONTINUED DEVELOPMENT OF COMPETITIVE PROPULSION SYSTEM
FOR THE JOINT STRIKE FIGHTER PROGRAM.
(a) In General.—Of the amounts authorized to be appropriated or otherwise made available
for fiscal year 2010 for research, development, test, and evaluation for the F-35 Lightning II
aircraft program, not more than 90 percent may be obligated until the Secretary of Defense
submits to the congressional defense committees a written certification that sufficient funds
have been obligated for fiscal year 2010 for the continued development of a competitive
propulsion system for the F-35 Lightning II aircraft to ensure that system development and
demonstration continues under the program during fiscal year 2010.
(b) Additional Amount for UH-1Y/AH-1Z Rotary Wing Aircraft.—The amount authorized
to be appropriated by section 102(a)(1) for aircraft procurement for the Navy is hereby
90 See page 93 of the conference report on H.R. 2346 (H.Rept. 111-151 of June 12, 2009).
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increased by $282,900,000, with the amount of the increase to be allocated to amounts
available for the procurement of UH-1Y/AH-1Z rotary wing aircraft.
(c) Restoration of Management Reserves for F-35 Joint Strike Fighter Program.—
(1) NAVY JOINT STRIKE FIGHTER.—The amount authorized to be appropriated by
section 201(a)(2) for research, development, test, and evaluation for the Navy is hereby
increased by $78,000,000, with the amount of the increase to be allocated to amounts
available for the Joint Strike Fighter program (PE # 0604800N) for management reserves.
(2) AIR FORCE JOINT STRIKE FIGHTER.—The amount authorized to be appropriated by
section 201(a)(3) for research, development, test, and evaluation for the Air Force is hereby
increased by $78,000,000, with the amount of the increase to be allocated to amounts
available for the Joint Strike Fighter program (PE # 0604800F) for management reserves.
(d) Offset.—The amount authorized to be appropriated by section 103(1) for aircraft
procurement for the Air Force is hereby decreased by $438,900,000, with the amount of the
decrease to be derived from amounts available for airlift aircraft for the HC/MC-130
recapitalization program.
S.Amdt. 1627 would:
• eliminate the language from Sec. 211 as reported by the Senate Armed Services
Committee that would prohibit DOD from obligating more than 90% of FY2010
F-35 research and development funds until the Secretary of Defense submits to
the congressional defense committees a written certification that sufficient funds
have been obligated for FY2010 for the continued development of a competitive
propulsion system for the F-35 to ensure that system development and
demonstration continues under the program during FY2010;
• replace the eliminated language with new language that prohibits the obligation
or expenditure of FY2010 funding on an alternate engine program until the
Secretary of Defense makes certain certifications regarding cost effectiveness of
such a program;
• eliminate the additional research and development funding for the alternate
engine program that was added in the Senate Armed Services Committee
markup;
• restore reductions to the UH-1Y/AH-1Z helicopter program and to F-35 program
management reserves that were made so as to make available the funding that
was added for the alternate engine program.
The text of S.Amdt. 1627 is as follows:
SEC. 211. LIMITATION ON USE OF FUNDS FOR AN ALTERNATIVE PROPULSION
SYSTEM FOR THE F-35 JOINT STRIKE FIGHTER PROGRAM; INCREASE IN
FUNDING FOR PROCUREMENT OF UH-1Y/AH-1Z ROTARY WING AIRCRAFT AND
FOR MANAGEMENT RESERVES FOR THE F-35 JOINT STRIKE FIGHTER
PROGRAM.
(a) Limitation on Use of Funds for an Alternative Propulsion System for the F-35 Joint
Strike Fighter Program.—None of the funds authorized to be appropriated or otherwise made
available by this Act may be obligated or expended for the development or procurement of
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an alternate propulsion system for the F-35 Joint Strike Fighter program until the Secretary
of Defense submits to the congressional defense committees a certification in writing that the
development and procurement of the alternate propulsion system—
(1) will—
(A) reduce the total life-cycle costs of the F-35 Joint Strike Fighter program; and
(B) improve the operational readiness of the fleet of F-35 Joint Strike Fighter aircraft; and
(2) will not—
(A) disrupt the F-35 Joint Strike Fighter program during the research, development, and
procurement phases of the program; or
(B) result in the procurement of fewer F-35 Joint Strike Fighter aircraft during the life cycle
of the program.
(b) Additional Amount for UH-1Y/AH-1Z Rotary Wing Aircraft.—The amount authorized
to be appropriated by section 102(a)(1) for aircraft procurement for the Navy is increased by
$282,900,000, with the amount of the increase to be allocated to amounts available for the
procurement of UH-1Y/AH-1Z rotary wing aircraft.
(c) Restoration of Management Reserves for F-35 Joint Strike Fighter Program.—
(1) NAVY JOINT STRIKE FIGHTER.—The amount authorized to be appropriated by
section 201(a)(2) for research, development, test, and evaluation for the Navy is hereby
increased by $78,000,000, with the amount of the increase to be allocated to amounts
available for the Joint Strike Fighter program (PE # 0604800N) for management reserves.
(2) AIR FORCE JOINT STRIKE FIGHTER.—The amount authorized to be appropriated by
section 201(a)(3) for research, development, test, and evaluation for the Air Force is hereby
increased by $78,000,000, with the amount of the increase to be allocated to amounts
available for the Joint Strike Fighter program (PE # 0604800F) for management reserves.
(d) Offsets.—
(1) NAVY JOINT STRIKE FIGHTER F136 DEVELOPMENT.—The amount authorized to
be appropriated by section 201(a)(2) for research, development, test, and evaluation for the
Navy is hereby decreased by $219,450,000, with the amount of the decrease to be derived
from amounts available for the Joint Strike Fighter (PE # 0604800N) for F136 development.
(2) AIR FORCE JOINT STRIKE FIGHTER F136 DEVELOPMENT.—The amount
authorized to be appropriated by section 201(a)(3) for research, development, test, and
evaluation for the Air Force is hereby decreased by $219,450,000, with the amount of the
decrease to be derived from amounts available for the Joint Strike Fighter (PE # 0604800F)
for F136 development.
FY2010 DOD Appropriations Bill (H.R. 3326)
In lieu of a conference report, the House Appropriations Committee on December 15, 2009,
released an explanatory statement on a final version of H.R. 3326. This version was passed by the
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House on December 16, 2009, and by the Senate on December 19, 2009, and signed into law on
December 19, 2009, as P.L. 111-118.
The explanatory statement states that it “is an explanation of the effects of Division A [of H.R.
3326], which makes appropriations for the Department of Defense for fiscal year 2010. As
provided in Section 8124 of the consolidated bill, this explanatory statement shall have the same
effect with respect to the allocation of funds and the implementation of this as if it were a joint
explanatory statement of a committee of the conference.”
The explanatory statement provided $2,083.8 million for Air Force F-35 procurement. This
represented a $35 million increase over the Administration request, with the additional funds
designated for the F-35 alternate engine program.
In the explanatory statement, Air Force research and development funding for the Joint Strike
Fighter program was $2.073.1 million, an increase of $215 million over the Administration
request, with the additional funds designated for the F-35 alternate engine program.
The explanatory statement set Navy research and development funding for the Joint Strike
Fighter program at $1,956.3 million, an increase of $215 million over the Administration request,
with the additional funds designated for the F-35 alternate engine program.
The explanatory statement also included this text:
JOINT STRIKE FIGHTER
Concerns persist regarding the progress of the F~35 Joint Strike Fighter (JSF) program. Last
year, the Department of Defense established a Joint Estimating Team (JET) to evaluate this
program. The JET reported that the program would cost significantly more and take longer to
fully develop and test than the Department was then projecting. Although the JET has yet to
officially report out for 2009, the initial indications are that cost growth and schedule issues
remain. Nevertheless, the Department insists that the program is on track to achieve both the
cost and schedule currently reflected in the program of record.
Therefore, the JSF procurement program is provided $6,840,478,000, and the JSF program is
designated as a congressional special interest item. The Secretary of Defense is directed to
ensure that all 30 aircraft be procured as requested in the budget. The Under Secretary of
Defense for Acquisition, Technology and Logistics is directed to provide the findings of the
JET along with recent studies on the test program and causes of cost growth to the
congressional defense committees no later than January 15, 2010.
The House Appropriations Committee, in its report (H.Rept. 111-230 of July 24, 2009) on H.R.
3326, recommends the following:
• a net increase of $18.6 million in Air Force procurement funding for the F-35
program, consisting of a reduction of $111.4 million for “Reduction to non-
recurring engineering” and an increase of $130 million for the alternate engine
(page 187, line 1);
• an increase of $215 million in Navy research and development funding for the F-
35 alternate engine (page 258, line 127); and
• an increase of $215 million in Air Force research and development funding for
the F-35 alternate engine (page 273, line 84).
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Regarding administration proposals to terminate programs, including the F-35 alternate engine
program, the report states:
The Committee also seeks to reverse a recent and increasing trend to curtail the development
of systems before such efforts realize any benefit to the taxpayer. The Committee strongly
supports realistic budgeting that matches available funding to overall programs. Indeed,
many of the program terminations proposed in the fiscal year 2010 budget request are
supported in this bill. Nevertheless, the Committee is concerned that the proposal to
terminate some programs is premature, and believes that continuing certain efforts may yield
significant payback. The Committee believes that this is clearly the case for the presidential
helicopter, wherein five aircraft have been purchased that could be pressed into service.
Similarly, in the Committee’s view, there is potential for significant payback associated with
the Joint Strike Fighter alternative engine and certain missile defense activities provided in
this recommendation. (Page 4)
The report also states:
JOINT STRIKE FIGHTER ALTERNATE ENGINE
The F–35 Lightning II Joint Strike Fighter program truly represents the Nation’s future with
respect to tactical aviation. The Navy, Marine Corps and Air Force plan to procure over
2,500 of these fifth generation stealthy aircraft and will fly them well into the future. The
Department’s original plan for the F–35 propulsion engine was to have two engine variants.
Cost growth in other areas of the development program resulted in the Department
abandoning the alternate engine program. Currently, all three variants of the F–35 aircraft
will be powered by the same propulsion engine. Although this will make the logistics for the
aircraft less complex, this practice presents problems. The Committee is extremely
concerned that in the near future when the F–35 will comprise the majority of the Nation’s
tactical aircraft inventory any technical problems with the engine could theoretically ground
the entire fleet of aircraft. If this situation were to arise in a time of crisis, the Commander-
in-Chief’s flexibility would be severely limited.
Another area of concern for the Committee is the lack of competition for the Joint Strike
Fighter engine program. With over 2,500 aircraft envisioned for this program, the potential
for cost savings through an engine competition is enormous. The Committee is aware that
the Department conducted a business case analysis that compared the cost of the program of
record (sole source engine provider) to a program using a dual source strategy for the engine
program. The business case concluded that the costs of the two programs were essentially the
same. Since the Congress has put several hundred million dollars into the development of an
alternate engine program since this business case was published, the Committee is puzzled
by the Department’s decision to not fund the alternate engine. With the majority of the
upfront development cost having been sunk into the program, it seems clear that from this
point forward the dual source strategy is the most cost effective method to acquire the
propulsion engine for the Joint Strike Fighter. Therefore, the recommendation provides an
additional $430,000,000 for the continued development of the alternate engine and
$130,000,000 for alternate engine production costs for a total of $560,000,000 above the
request for the alternate engine program. Further, since a dual source engine strategy is the
most cost effective method for acquiring engines from this point forward, the Secretary of
Defense is directed to include funding for the alternate engine program in future budget
requests. (Pages 215-216)
A July 28, 2009, statement of administration policy on H.R. 3326 as reported in the House states
the following regarding the F-35 program:
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Joint Strike Fighter (F-35) Alternate Engine. The Administration strongly objects to the
addition of $130 million to produce, and $430 million to continue the development of, the
Joint Strike Fighter (JSF) alternate engine, which was proposed for termination by the
President. Expenditures on an alternate engine for the JSF are unnecessary and divert
resources from the overall JSF program. The current engine is performing well, and the risks
associated with a single engine provider are manageable. If the final bill presented to the
President would seriously disrupt the F-35 program, the President’s senior advisors would
recommend that he veto the bill.91
The Senate Appropriations Committee, in its report (S.Rept. 111-74 of September 10, 2009) on
H.R. 3326, recommends no funding for F-35 alternate engine development.
91 Executive Office of the President, Office of Management and Budget, Statement of Administration Policy, H.R.
3326—Department of Defense Appropriations Act, 2010, July 28, 2009, p. 2. Emphasis as in the original.
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Appendix B. The “Great Engine War” of 1984-1994
Congress’s interest in establishing and funding an F-35 alternate engine program may have been
informed by “the Great Engine War”—an annual competition from 1984 to 1994 between Pratt &
Whitney and General Electric to produce and maintain engines for Air Force F-16 fighters.92 Pratt
& Whitney’s engine for the F-16 was the F100, which was originally developed for the Air Force
F-15 fighter. General Electric’s alternate engine for the F-16 was the F110.
Historians trace the Air Force’s interest in pursuing an alternate engine for the F-16 to Air Force
frustrations in the 1970s with Pratt & Whitney’s management of the effort to develop the F100
and to Air Force concerns about using a single type of sole-sourced engine to power their entire
fighter fleet of F-15s and F-16s.93 After a number of contentious hearings in 1979, Congress
provided funding through the Engine Model Derivative Program (EMDP), a congressionally
directed program, for General Electric to develop its F101 engine (which later became the F110)
as an alternate engine for the F-16. DOD spent more than $376 million to develop the F110 to
compete with the F100 and $600 million to improve the F100’s durability and reliability to make
it a stronger competitor.
The use of annual competitions for procuring engines for an aircraft procurement program was
unprecedented and controversial. Proponents believe it produced better engines, on better terms,
for less money than would purchasing from a single company facing no competition. Other
observers believed it “unjustifiably jeopardized combat effectiveness and pilot survivability.”94
Most studies have concluded that contractor responsiveness—not dollar savings—was the
primary benefit of the competition. Testimony presented at a 1984 hearing suggested that
requiring General Electric and Pratt & Whitney to compete for annual production and O&S work
generated benefits for DOD in areas such as better contract terms and conditions, better
warranties to assure engine quality, consistency, and long term stability of support.95 A 1987
assessment stated that after competition was introduced, the incumbent (Pratt & Whitney) offered
“engine improvements to the Air Force earlier than the Air Force had been led to expect without
the competition.”96
The benefits of the Great Engine War have been attributed in part to the particulars of how the
engine competition was managed. Prior to the first contract award, for example, the Air Force
demanded that General Electric and Pratt & Whitney provide six years of cost projections to
92 After 1994, Pratt & Whitney and GE continued to compete for engine business among foreign air forces that
operated the F-16 and F-15.
93 The F100 was the most advanced engine ever developed at that time, and its developed was rushed to meet a
deadline for initial fielding of the F-15. In addition, one report notes that “[t]he F100 engine was so powerful and the F-
15 so maneuverable that pilots began pushing the aircraft to the edge of the performance envelope in ways that stressed
the engine far more than had been anticipated.” (Karl G. Amick, The Next Great Engine War: Analysis and
Recommendations for Managing the Joint Strike Fighter Engine Competition, Naval Postgraduate School, Monterey,
CA. 2005, p. 8.) Mounting frustrations over Pratt & Whitney’s reluctance to fully address the F100’s shortcomings
without additional funding resulted in the Air Force, Navy, and Congress working in concert to fund work on an
alternate engine. (Ibid, p. 92-98)
94 Robert W. Drewes, The Air Force and the Great Engine War, National Defense University Press, Washington DC,
1987.
95 U.S. Congress, House, Committee on Armed Services, Air Force Alternative Fighter Engine, Hearings before the
Subcommittee on Procurement and Military Nuclear systems, 98th Cong. 2nd Sess., March 8, 1984.
96 Robert W. Drewes. The Air Force and the Great Engine War. NDU Press (Washington, DC) 1987.
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include the production of engines, support equipment, spare engines, technical data and dual
sourcing data and second sourcing data for operations and support (O&S). The contractors were
held to these cost projections for six years: the Air Force let six years of firm-fixed price, or “not-
to-exceed” contracts from the first production lot. Prior to the Great Engine War, government had
succeeded in negotiating firm-fixed price contracts only after the engine had been operating in the
field for several years. Never before had contractors agreed to provide cost projections into the
future, and contracts were typically for production only, not O&S work. To avoid potential
disruptions in production, and to protect itself against price gouging, DOD “required (each
contractor) to provide his plan for providing dual sources of critical parts. These separately priced
options in the proposals would allow the Government to reprocure spare parts from sources other
than the prime contractors.”97
Table B-1. “Great Engine War” Procurement Quantities
Pratt & Whitney
General Electric
FY
F100-PW-220
F110-GE-100
Pratt %
GE %
85a 40
120
25%
75%
86 159
184
46%
54%
87 160
205
44%
56%
88 181
147
55%
45%
89 159
100
61%
39%
90 70
39
64%
36%
Total 769
795
49%
51%
Source: Armed Services Board of Contract Appeals, Appeals of United Technologies Corporation, ASBCA Nos.
51410, 53089, and 53349 under Contract No. F33657-84-C-2014, February 27, 2004.
a. Under the preceding sole-source contract, DOD had already awarded P&W an FY85 contract for 120
engines. The numbers shown here are for the subsequent competitive bid only.
Author Contact Information
Jeremiah Gertler
Specialist in Military Aviation
jgertler@crs.loc.gov, 7-5107
Acknowledgments
Significant portions of this paper present, in edited form, material from CRS Report RL33390, Proposed
Termination of Joint Strike Fighter (JSF) F136 Alternate Engine, by Christopher Bolkcom.
97 Prepared Statement of Hon. Thomas Cooper. Air Force Alternative Fighter Engine, Hearings OpCit.
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