U.S. eyes new deal for Afghan planes in 2013

WASHINGTON Fri Apr 13, 2012 5:03pm EDT

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WASHINGTON (Reuters) - The U.S. Air Force said on Friday it will issue draft revised rules for a competition to supply 20 light attack planes to Afghanistan next week, with an eye to awarding a contract in early 2013.

The news came as an internal Air Force investigation found that a $355 million contract awarded and abruptly canceled in late February had been granted without following the proper decision-making process, a source told Reuters.

Air Force officials told congressional aides on Friday that the acquisition team that had awarded the contract to privately held Sierra Nevada Corp and Brazil's Embraer (EMBR3.SA) was found to be inexperienced and did not adhere to established acquisition processes, said the source who is familiar with the briefing.

The Air Force said it had appointed a new, higher-level source selection team to evaluate new proposals submitted by the companies, according to the source, who was not authorized to speak publicly.

Citing the officials, the source said the investigation had not found deliberate misconduct by the U.S. officials involved.

Losing bidder Hawker Beechcraft HKBCH.UL, which is undergoing a major financial restructuring, has filed a lawsuit against the Air Force for what it called a "flawed process."

Hawker Chairman Bill Boisture said the company was looking forward to getting details of the proposed changes, but said the Air Force needed to rethink its requirements in addition to improving its decision-making process.

He said the Embraer plane chosen the first time, the Super Tucano, did not meet ejection seat, munitions and communications standards in place for U.S. military aircraft, despite the fact that U.S. personnel would likely be training the Afghan air force to fly the new planes.

"If you don't get the requirements right, you don't get the right results," he told Reuters in a telephone interview.

No comment was immediately available from Sierra Nevada.

Air Force officials had described the incident as embarrassing and disappointing after years of concerted efforts to improve acquisition procedures and rebuild the service's reputation after a spate of botched contract decisions over the past decade.

The service said in a statement on Friday that it will issue on April 17 draft amendments to the previous competition rules and brief the companies the same day. The changes would "more clearly define the evaluation criteria and tighten the decision-making process," it said.

The companies would have until April 24 to respond, with final rules to be issued on April 30.

That would allow a contract award in early 2013, with first aircraft deliveries to Afghanistan delayed to the third quarter of 2014, about 15 months later than initially planned, the Air Force said in the statement.

The service said it completed the first phase of a commander-directed investigation last week, but gave no details since the competition was still continuing.

It said any actions to hold specific individuals accountable for the improperly handled contract decision would be taken over the next several months.

The Air Force said a second phase of the investigation was still under way, with investigators reviewing two source selections from Air Force Materiel Command and Air Force Space Command's Space and Missile Center "to assess quality and consistency of source selection procedures implemented in other Air Force systems acquisition programs."

(Reporting By Andrea Shalal-Esa; Editing by Gerald E. McCormick, Richard Chang, Gary Hill)

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