Cuts to aircraft program could cost jobs

Defense giant Northrop Grumman and its congressional supporters are pressing the Pentagon to clear up a misunderstanding that could result in nearly 350 jobs lost and delay one of the Navy’s highest priorities.

The Los Angeles-based defense contractor says most of the jobs could be cut in Florida if it does not receive more money by April to build the E2-D Advanced Hawkeye — the Navy’s newest early-warning and battle-management aircraft.

{mosads}Northrop Grumman and its supporters — mainly the Florida delegation — find themselves in a unique bind. Congress cut more than $200 million from the Navy’s budget for the E2-D Advanced Hawkeye for 2009 when the defense committees wanted to slow production because of information that pointed to trouble with the aircraft’s radar — a key component.

A Navy spokeswoman said that information was outdated, that past problems had been ironed out and that the program now exceeds its goals.

 But by the time the Navy corrected the record, it was too late: The House and Senate appropriators were on an accelerated schedule to pass a large government spending bill that included the full 2009 defense budget. Lawmakers did not restore the money during conference negotiations that were completed in a few days, according to a House aide.

The Senate appropriators cut $165.5 million from the program, a reduction that basically slashes the production of one plane in 2009 and will likely affect the production of another in 2010.

Meanwhile, the House cut $37.9 million from funds necessary for the company to buy items in advance of production.

“The Advanced Hawkeye program is the cornerstone of the Navy’s efforts to protect against cruise missiles,” said Rep. Ander Crenshaw (R-Fla.), a House appropriator and longtime supporter of the program. The lack of funding, he added, “is especially disappointing because the Advanced Hawkeye program continues to meet and exceed both cost and schedule goals and is needed to address urgent threats.”

Crenshaw is working closely with Reps. John Mica (R-Fla.) and Corrine Brown (D-Fla.) to convince the Pentagon and the Navy to dig deep and find money in the existing 2009 budget that can be shifted and allocated toward the Hawkeye program.

Before redistricting occurred several years ago, Crenshaw oversaw the district that includes Northrop Grumman’s St. Augustine, Fla., plant where the Hawkeye is built. Now that plant falls in Mica’s district.

The House lawmakers sent a letter last month to Defense Secretary Robert Gates urging his “personal attention to the issue.” The lawmakers pressed Gates to restore the money for the Hawkeye.

Florida Sens. Bill Nelson (D) and Mel Martinez (R) also have urged Gates to allocate money to address the problem.

Trying to find funds in the existing budget would be the quickest way to avoid the layoffs that Northrop Grumman predicts. Another option may be the upcoming emergency war supplemental, but its timing is still undetermined.

Even though Northrop is eyeing every option, the economic stimulus package now under consideration does not address weapons programs and is an unlikely vehicle.

The 70 planes that the Hawkeye program calls for will still be built, but slowing down the rate of production reduces the number of workers needed and increases the cost of the plane, Northrop Grumman contends.

The Navy will also face another risk: The 2011 target for when the plane is scheduled to be operational could slip by two years.

“We have the manufacturing capacity now to accommodate up to 10 E2-Ds a year,” Tom Vice, vice president for Northrop Grumman’s Aerospace Systems sector, said in a statement.

Vice added that the program has been performing very well and is meeting all its commitments. “I can’t understand this draconian cut now to what is widely recognized as a model major defense acquisition program,” Vice said.

While Florida is taking the largest hit from the funding cuts, Northrop Grumman has 280 suppliers for the Hawkeye across the country. They also face an immediate job loss come April, said Dianne Baumert-Moyik, a Northrop Grumman spokeswoman.

Altogether it would be about 350 jobs lost in Florida and across the country, but that could also have ripple effects, she said. For every 300 jobs lost there are another 700 lost across the economy, she said.

Meanwhile, Northrop is pulling out all the stops: The company is involving governors as well as state and local leaders to turn up the heat on the Pentagon and Congress. Northrop Grumman is raising awareness among the New York and California delegations, where the defense contractor has major operations.

In early March, if nothing is done, the company also will intensify its message during its annual Hawkeye industry day in Washington, Baumert-Moyik said.