US GAO says union poses no conflict on tanker issue

* Protests handled by GAO lawyers, not union workers

* Pentagon to release final tanker bidding terms soon

WASHINGTON, Nov 12 (Reuters) - The Government
Accountability Office, the congressional agency that reviews
contract protests, on Thursday denied it would have any
conflict of interest if asked to rule again on the Air Force's
aerial tanker competition.

Defense analyst Loren Thompson of the Virginia-based
Lexington Institute raised the possibility in a recent blog,
noting that GAO employees belong to a union that represents
85,000 white collar workers, including some at Boeing Co
(BA.N).

Boeing is competing with Northrop Grumman Corp (NOC.N) and
Airbus parent EADS (EAD.PA) to build 179 refueling airplanes
for the Air Force in a deal worth up to $35 billion. Northrop
and EADS won the contract in February 2008, but the Pentagon
canceled it last year after the GAO upheld a Boeing protest.

Analysts and industry officials are closely examining draft
terms for the new competition released by the Air Force in
September. Final bidding terms are expected to be released soon
and the Pentagon aims to award the contract by June.

Many predict the non-partisan GAO may again be asked to
weigh in, possibly even before a contract is awarded.

GAO spokesman Chuck Young said the agency would have no
potential conflict of interest because all bid protests are
handled by GAO lawyers, who are not part of the International
Federation of Professional and Technical Engineers union.

"There's no one who is a member of the union who works on
our bid protests," Young told Reuters.

"It's completely separate, so there is no conflict of
interest," he said.
(Reporting by Andrea Shalal-Esa; Editing by Steve Orlofsky)