12.22.10

Armed Services Committee to Investigate Improper Sharing of Tanker Data

Cantwell secures oversight hearings into whether release of proprietary data tainted tanker competition

WASHINGTON, D.C. – Today, U.S. Senator Maria Cantwell (D-WA) secured a commitment from Senate Armed Services Committee Chairman Carl Levin to investigate the release of proprietary data by the U.S. Air Force in the $35 billion KC-X tanker competition. Cantwell secured the agreement as part of the negotiations this morning on the National Defense Authorization Act, which passed today. The agreement requires the Senate Armed Services Committee to investigate whether inappropriate and unauthorized proprietary data was reviewed by Airbus and gave Airbus an unfair advantage in preparing its bid for the tanker contract. Chairman Levin said the Committee will hold hearings in January as part of the investigation.
 
“In the last competition, the GAO (Government Accountability Office) found multiple instances of uneven treatment that when compiled showed a pervasive bias in support of EADS/Airbus,” Senator Cantwell said in a written exchange with Senator Levin that was entered into the Congressional Record this morning.Cantwell said, “I am respectfully requesting that the Chairman of the Armed Services Committee initiate an investigation into the particular release of proprietary data to determine whether or not laws and fair competition regulations have been appropriately followed.”
 
“I am deeply concerned by the Air Force’s mishandling of proprietary information and we deserve answers on what impact it has had on this competition and American jobs,” said Senator Patty Murray (D-WA). “The Pentagon has already allowed an illegally subsidized foreign company to compete, has refused to take the WTO’s ruling on those illegal subsidies into account, and has repeatedly delayed this competition to accommodate Airbus.
 
“We cannot afford for the Pentagon to continue bending the rules for a company that doesn’t play by them. Not when thousands of American jobs are on the line.”
 
The complete text of the agreement between Senators Cantwell and Levin follows.
 
Ms. Cantwell:  Mr. President, I rise to enter into a colloquy with the esteemed Chairman of the Senate Armed Services Committee, Senator Levin.
 
Mr. President, I recognize that there are objections to bringing up a bill dealing with the Air Force KC-X tanker competition requiring the Secretary of Defense to take into account any unfair competitive advantages given to any of the competitors for the contract.  This provision has passed twice on the House side now by overwhelming majorities and I am shocked that the same language cannot be included in the Defense Authorization Bill or passed as a stand-alone bill. These are legitimate concerns being brushed under the rug rather than dealt with head on.  I recognize that with such a short amount of time left in this Congress we will have trouble convincing our colleagues that we are allowing a terrible precedent to be set and an expensive injustice is being done to American workers and taxpayers. 
 
Mr. President, In the last competition, GAO found multiple instances of uneven treatment that when compiled showed a pervasive bias in support of EADS/Airbus. Unfortunately we now are seeing a similar pattern of behavior emerging and I have concerns about the conduct of the competition by the Pentagon for this U.S. taxpayer-funded $35 billion contract.  At every turn, it seems the Pentagon has gone out of its way to advantage EADS/ Airbus for example, the Pentagon has structured the competition in ways that minimize the cost advantages of an American-made tanker; extended deadlines to accommodate EADS/Airbus; adjusted analytical models in the competition in ways that favor only the EADS/Airbus tanker; and, most recently decided to continue using the so-called IFARA war scenario model in the competition despite having inadvertently released proprietary information that disclosed Boeing’s scores to EADS/Airbus. In recent press stories EADS/Airbus officials claimed they did not look at Boeing’s proprietary information but it has now come out that in fact EADS/Airbus did look at it. This type of behavior is unacceptable.
 
In light of the serious national security and economic implications of the KC-X Tanker competition, I am respectfully requesting that the Chairman of the Armed Services Committee initiate an investigation into these issues – in particular the inadvertent release of proprietary data - to determine whether or not laws and fair competition regulations have been appropriately followed.  Further, I am seeking the Chairman’s assurance today that he intends to call Departmental witnesses before the Armed Services Committee to ensure that the Committee is fully informed on the progress, status, and conclusions regarding the aforementioned investigation and any other DoD investigations into this and related matters. 
 
Mr. Levin: I am prepared to direct staff immediately to initiate an investigation into the release of proprietary data to determine if laws and fair competition regulations have been appropriately followed. I also intend to hold one or more hearings by February 1 to consider these issues and to review the propriety of the procurement process of the KC-X tanker competition as it relates to this issue.
 
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