December 2006

From the editors of CCH's government contracts products, here are summaries of the important recent developments in this practice area for the past month.  Complete coverage of these issues, and many more, appear in the Government Contracts Reporter and related products.

If you have comments or suggestions concerning the information provided or the format used, please feel free to contact me directly at aaron.broaddus@wolterskluwer.com.

Legal News

Civilian Board of Contract Appeals To Make Its Debut
Effective January 7, 2007, eight boards of contract appeals will terminate, and their cases, judges, and personnel will transfer to the General Services Administration's newly created Civilian Board of Contract Appeals, which was established by section 847 of the National Defense Authorization Act for Fiscal Year 2006 (PL 109-163). The consolidation affects the GSA Board of Contract Appeals and the boards of contract appeals for the departments of Agriculture, Energy, Housing and Urban Development, Interior, Labor, Transportation, and Veterans Affairs. After the merger, most contract disputes will be decided by the CBCA and the Armed Services Board of Contract Appeals, leaving the Postal Service Board of Contract Appeals and the board of contract appeals of the Tennessee Valley Authority as the remaining two specialized boards.

The CBCA's mailing address will be 1800 F Street, NW, Washington, DC 20405. The phone number of the Office of the Clerk of the Board will be (202) 606-8800 and the facsimile number will be (202) 606-0019. The board's Internet address will be www.cbca.gsa.gov. The text of the notice announcing the CBCA appears at 71 FR 65825. (Government Contracts Report Letter No. 1889, December 27, 2006)

120-Day "Bridge" Contract Circumvented CICA Stay
Concerns arising from an intradepartmental transfer of procurement functions did not justify the override of an automatic stay of performance pending resolution of a protest, according to the Court of Federal Claims, because the staffing and service problems asserted by the government were overstated or misrepresented, and alternatives to the award of an interim "bridge" contract were not considered. After the award of a produce contract was stayed pending the outcome of a protest before the Comptroller General, the government entered into a 120-day interim contract with one of the awardees under the Competition in Contracting Act's "unusual and compelling urgency" exception (10 USC 2304(c)(2)). Following a protest challenging the interim contract, the government overrode the automatic stay issued pursuant to CICA, citing urgent and compelling circumstances.

Findings Questioned

The court found the override decision was likely arbitrary, capricious, and contrary to law. Concerns relating to the transferor agency's alleged inability to provide continuing support, such as possible damage to the agency's reputation and giving targeted employees "false hopes" of continuing employment, are not "urgent and compelling" or the sort of considerations that should foreclose use of a prior arrangement as an alternative to overriding a stay. Further, the record did not support many of the justifications. Government evidence concerning staff reductions conflicted and most of the planned staff reductions had not yet occurred. A declaration from a retired official of the transferor agency stated the justifications for the override were unreasonable because the agency had agreed to provide procurement support until the transferee agency had its new contracts in place and the transferor agency had the resources and existing blanket purchase agreements to continue to provide services to the transferee agency. Concerns that contractors might lose money if they purchased produce that would not be delivered was a "neutral proposition as the identified risk would be borne by any vendor" who entered into an interim contract. Moreover, the transferor agency's alleged unwillingness to provide continuing services was not challenged within the governmental hierarchy.

Alternatives Not Considered

In addition, the government did not consider reasonable alternatives to the interim contract. The government might have used the transferor agency's existing BPAs or conducted a broader interim procurement beyond the two successful offerors. Also, the government did not consider the costs or other impacts of having the override decision set aside, and continued training activities with the initial awardee apparently violated the automatic stay. The court concluded "[g]iven the state of the administrative record, one is left with the impression --at least for the moment --that the decision to give the interim contract to [the interim contractor] was viewed as a way to circumvent the stay, thereby undercutting the important policy considerations underlying the collective Congressional wisdom to create the stay, in the first instance." The facts of the case were distinguishable from other cases upholding CICA overrides where interim contracts were utilized, and the government's problems were based on a lack of advance planning, "typified by its failure to pursue continuation of its arrangement with the [transferor agency] in the face of [that] agency's apparent prior unwillingness to perform." After considering the remaining relevant factors, the court issued a preliminary injunction enjoining performance of the interim contract, but stayed the order for a period of seven days to "ensure the uninterrupted flow of fruit and vegetables to the affected families." (Reilly's Wholesale Produce v. U.S., et al., FedCl, 50 CCF ¶78,648; Government Contracts Report Letter No. 1887, December 13, 2006)

Combatant Activities Exception Did Not Preempt State Tort Claims
The District Court for the Middle District of Florida found that military transportation contractors operating in a combat zone were not immune from a third-party suit under the combatant activities exception to the Federal Tort Claims Act, because the exception does not preempt state tort claims against private contractors. The dispute involved members of the military who were killed in an airplane crash while serving in Afghanistan. After their estates filed suit against air transportation and operational support service contractors, the contractors moved to dismiss based on the FTCA's combatant activities exception, which provides the government does not waive its sovereign immunity for "any claim arising out of the combatant activities of the military or naval forces ... during time of war" (28 USC 2680(j)).

Private Defendants

The court observed Koohi v. U.S. (976 F2d 1328 (CA-9 1992)) and Bentzlin v. Hughes Aircraft Co. (833 FSupp 1486 (CD Cal 1993)) applied the exception to preempt state tort law claims against defense contractors, but concluded those courts either "[u]nwittingly confused the government contractor defense and the combatant activities exception to the FTCA, or ... [c]rafted an entirely new defense based on sovereign immunity and federal preemption." The combatant activities exception preserves sovereign immunity by legislation, while the government contractor defense is an affirmative defense based on federal preemption and the FTCA's discretionary function exception. The government contractor defense shields contractors only in military equipment procurements and only when the government dictates design specifications. "There is no express authority for judicially intermixing the government contractor defense and the combatant activities exception; nor is there authority for bestowing a private actor with the shield of sovereign immunity. Until Congress directs otherwise, private, non-employee contractors are limited to the government contractor defense.... [U]nless they qualify as employees or agents of the Government, private contractors may not bootstrap the Government's sovereign immunity." As an alternative basis for its holding, the court found the exception may be used only to preempt products liability claims involving complex equipment used during wartime. (Jeanette McMahon, et al. v. Presidential Airways, Inc., et al., DC MD Fla, 50 CCF ¶78,662; Government Contracts Report Letter No. 1889, December 27, 2006)

Legislative and Regulatory Activity

FAC Clarifies Payment Rules, Expands Commercial Contract Use
The Civilian Agency Acquisition and Defense Acquisition Regulations Councils have published Federal Acquisition Circular 2005-15. The Circular contains two final rules amending the Federal Acquisition Regulation. The rules address Payments Under Time-and-Materials and Labor-Hour Contracts (FAR Case 2004-015), and Additional Commercial Contract Types (FAR Case 2003-027). Each rule has a delayed effective date of February 12, 2007.

Payments

The rule associated with FAR Case 2004-015 clarifies payment procedures for time-and-materials and labor-hour contracts. The rule adopts a proposed rule (¶70,006.184) to amend underlying policies and increase the clarity of the applicable FAR language. Accordingly, FAR 16.307(a)(1) is amended to prescribe the use of the Allowable Cost and Payment clause (FAR 52.216-7) in T&M contracts. Also, the rule revises language in FAR 16.601 to provide a description of "materials" as used in "time-and-materials contract" and to prescribe the use of three new contract clauses: FAR 52.216-29, Time-and-Materials/Labor-Hour Proposal Requirements --Non-Commercial Item Acquisition With Adequate Price Competition, FAR 52.216-30, Time-and-Materials/Labor-Hour Proposal Requirements --Non-Commercial Item Acquisition without Adequate Price Competition, and FAR 52.216-31, Time-and-Materials/Labor-Hour Proposal Requirements --Commercial Item Acquisition. In addition, the rule revises the clause at FAR 52.232-7, Payments under Time-and-Materials and Labor-Hour Contracts, and makes corresponding technical amendments to FAR 32.111, which prescribes use of the clause.

Contract Types

The amendments made under FAR Case 2004-015 apply primarily to non-commercial item contracts. Policies applicable to commercial item T&M or L-H contracts are addressed separately under the FAR Case 2003-027 final rule. This latter rule adopts a prior proposal (¶70,006.185) to amend the FAR to implement section 1432 of the National Defense Authorization Act for Fiscal Year 2004. Title XIV of the Act, referred to as the Services Acquisition Report Act of 2003, amended section 8002(d) of the Federal Acquisition Streamlining Act of 1994 to expressly authorize the use of T&M and L-H contracts for commercial services under two specified categories: commercial services procured for support of a commercial item, as described in 41 USC 403(12)(E); and any other category of commercial services designated by the Administrator of the Office of Federal Procurement Policy when the commercial services in the category are of a type of services commonly sold to the general public through use of T&M or L-H contracts, and it would be in the best interests of the government to authorize use of T&M or L-H contracts for purchase of the commercial services in the category. The final rule amends the definition of "Commercial item" at FAR 2.101, makes editorial changes to FAR 10.001, amends FAR 10.002 to clarify market research procedures, revised FAR 12.207 to expand the list of contract types that may be used to acquire commercial items, made technical changes to FAR 12.301 and FAR 12.403, amended the description of T&M at FAR 16.601 and the description of L-H contracts at FAR 16.602, and adds an alternate clause to FAR 52.212-4, Contract Terms and Conditions --Commercial Items. For the text of FAC 2005-15, which also contains a small entity compliance guide, see ¶70,002.86. (Government Contracts Report Letter No. 1888, December 20, 2006)

DoD Issues Cost and Pricing/CAS Administration Rule
An amendment to the Defense Federal Acquisition Regulation Supplement makes extensive changes to text addressing contract pricing matters and cost accounting standards administration of Department of Defense contracts. The rule, which adopts a prior proposal (¶70,020.219), implements statutory provisions regarding exceptions to cost or pricing data requirements and waiver of cost accounting standards, and relocates internal DoD procedures relating to pricing considerations and cost accounting standards to the DFARS companion resource, Procedures, Guidance, and Information. The complete listing of provisions impacted by this rule appears below in the Regulation Table. For the text of the final rule, effective December 1, 2006, see ¶70,016.411.

Amendments

Specific changes to the DFARS include the following: addition of text at DFARS 215.403-1 and DFARS 230.201-5 to implement Section 817 of the National Defense Authorization Act for Fiscal Year 2003 regarding exceptions to cost or pricing data requirements and waiver of cost accounting standards; deletion of DFARS 215.404-1(d), Cost realism analysis, because FAR 15.404-1 contains sufficient policy on this subject; deletion of unnecessary introductory text at redesignated DFARS 215.404-71-4(f), Facilities capital employed, Values: Normal and designated ranges; relocation of the definition of "Acceptable estimating system" from DFARS 215.407-5-70(a)(1) to the contract clause at DFARS 252.215- 7002, Cost Estimating System Requirements; removal of DFARS 230.7000, Contract facilities capital estimates, DFARS 230.7001, Use of DD Form 1861 and DFARS 230.7002, Preaward facilities capital applications, and relocation of text on these subjects to DFARS 215.404-71-4, Weighted guidelines method --Facilities capital employed, because these sections pertain to the calculation of weighted guidelines for profit, rather than cost accounting standards; elimination of DFARS 230.7003, Postaward facilities capital applications, and DFARS 230.7004-1, Forms CASB-CMF, because these provisions duplicate Cost Accounting Standard 414, Cost of Money as an Element of the Cost of Facilities Capital, and FAR 31.205-10, Cost of Money, and the implementing contract clauses; elimination of the definitions of "intangible capital asset" and "tangible capital asset" at DFARS 230.7100(a) and (b), since these definitions are provided in the cost accounting standards, as well as the elimination of the definition of "cost of money rate" at DFARS 230.7100(c), because it conflicts with cost accounting standards; elimination of DFARS 230.7101, Calculations, and DFARS 230.7102, Determining imputed cost of money, because they are adequately covered in CAS 417, Cost of Money as an Element of the Cost of Capital Assets Under Construction; and removal of DFARS 230.7103, Preaward capital employed application, and relocation of text on this subject to DFARS 215.404-73(b)(2)(i), Offsets for facilities capital cost of money, because it applies to offsets in determining profit, rather than cost accounting standards.

New PGI

The rule also relocates the following text to the PGI: DFARS 215.403-5, Instructions for submission of cost or pricing data or information other than cost or pricing data; DFARS 215.404-2, Information to support proposal analysis; DFARS 215.404-3, Subcontract pricing considerations; DFARS 215.404-70, DD Form 1547, Record of Weighted Guidelines Method Application; DFARS 215.404-76, Reporting profit and fee statistics; DFARS 215.406-1, Prenegotiation objectives; DFARS 215.406-3, Documenting the negotiation; DFARS 215.407-4, Should-cost review; DFARS 215.407-5-70(e) and (f), Estimating systems --Disclosure, maintenance, and review requirements; DFARS 215.470(b) and (c), Estimated data prices (except the first sentence of (b) remains in DFARS, and is revised for clarity); DFARS 230.201-5(a)(1), Waiver (partial relocation); DFARS 230.7004-2, DD Form 1861 (relocated to PGI 215.404-71-4(c), consistent with the relocation of DFARS 230.7000, DFARS 230.7001, and DFARS 230.7002 to DFARS 215.404-71-4); and DFARS 253.215-70, DD Form 1547, Record of Weighted Guidelines Application. (Government Contracts Report Letter No. 1887, December 13, 2006)

DFARS Rule Adds Policy on Labor Costs Reimbursement
A Department of Defense interim rule amends the Defense Federal Acquisition Regulation Supplement to provide policy for reimbursing labor costs on competitively awarded DoD non-commercial time-and-materials and labor-hour contracts. This rule supplements a final Federal Acquisition Regulation rule published in Federal Acquisition Circular 2005-15, under FAR Case 2004-015 (see FAC story above). The FAR rule prescribes several options for establishing fixed hourly rates on competitively awarded non-commercial T&M and L-H contracts. In this interim rule, DoD selected, and made mandatory, the option requiring separate fixed hourly rates that include profit for each category of labor performed by the contractor and each subcontractor, and for each category of labor transferred between divisions, subsidiaries, or affiliates of the contractor under a common control. The agency made the decision given the relatively large dollar value of many DoD non-commercial T&M and L-H contracts, the significant oversight and legislative initiatives that have focused on DoD in recent years, and because the preponderance of DoD non-commercial T&M and L-H contracts are performed by traditional DoD contractors and subcontractors, who already have the necessary mechanisms in place to establish separate fixed hourly rates for each performing entity without significant administrative burden. Accordingly, the rule adds a new provision at DFARS 216.601 and a new clause at DFARS 252.216-7002. The interim rule has a delayed effective date of February 12, 2007. Comments on the rule, identified by DFARS Case 2006-D030, are due by February 12, 2007. The text of the rule appears at ¶70,016.412. (Government Contracts Report Letter No. 1888, December 20, 2006)

Defense Acquisition Thresholds Adjusted for Inflation
A Department of Defense final rule amends the Defense Federal Acquisition Regulation Supplement to adjust acquisition-related thresholds for inflation. Section 807 of the National Defense Authorization Act for Fiscal Year 2005 requires periodic adjustment of statutory acquisition-related dollar thresholds, except those established by the Davis-Bacon Act, the Service Contract Act, or trade agreements. This rule also amends other acquisition-related thresholds that are based on policy rather than statute. DoD adopted a proposed rule (¶70,020.220) with updated data, resulting in a slight increase in the calculated inflation adjustment factors. For the five-year period from October 2000, through October 2005, the inflation adjustment factor increased from 13 percent to 14.5 percent. However, due to rounding, most thresholds shown in the proposed rule did not change. In addition to changing threshold amounts, this final rule adds a new provision at DFARS 201.109 and a corresponding reference in the DFARS companion resource, Procedures, Guidance, and Information at PGI 201.109. For the text of the final rule, effective December 19, 2006, see ¶70,016.414. (Government Contracts Report Letter No. 1889, December 27, 2006)

New Energy Efficiency Products Clause Proposed
The Civilian Agency Acquisition Council and the Defense Acquisition Regulations Council are proposing amendments to the Federal Acquisition Regulation to address the implementation of Section 104 of the Energy Policy Act of 2005. FAR 23.203 currently requires the purchase of ENERGY STAR®or other energy-efficient items listed on the Federal Energy Management Program Product Energy Efficiency Recommendations list when acquiring energy-using products. The same provision requires specification of these energy-efficient items when contracting for services that will include the provision of energy-using products, including contracts for design, construction, renovation, or maintenance of a public building. These requirements are often overlooked in services and construction contracts because there is no clause to implement the requirements. Therefore, proposed FAR 23.207 provides for a new clause at FAR 52.223-XX to be inserted in solicitations and contracts to ensure suppliers and service and construction contractors recognize when energy-consuming products must be ENERGY STAR®or FEMP-designated. New definitions and exemptions are also proposed. The rule would redesignate FAR 23.201, FAR 23.202, FAR 23.203, and FAR 23.204 as FAR 23.202, FAR 23.203, FAR 23.204, and FAR 23.206, respectively; add new FAR 23.201 and FAR 23.205; revise newly designated FAR 23.202 and FAR 23.204; and amend FAR 36.601-3, FAR 52.212-5, and FAR 52.213-4. Comments are due February 5, 2007. For the text of the proposed rule, see ¶70,006.201. (Government Contracts Report Letter No. 1888, December 20, 2006)

Major Contract Awards

Stewart & Stevenson - $650 Million. Stewart & Stevenson Tactical Vehicle Systems L.P., Sealy, TX, was awarded a $344,147,266 modification to a firm-fixed-price and cost-reimbursement contract for the family of medium tactical vehicle trucks and trailers. They also received a $305,392,679 modification to another firm-fixed-price and cost-reimbursement contract for medium tactical vehicle trucks and trailers. Work is expected to be completed on Nov. 15, 2008. The U.S. Army Tank-Automotive and Armaments Command, Warren, MI, is the reporting contract office. (Government Contracts Report Letter No. 1887, December 13, 2006)

General Dynamics - $305 Million. General Dynamics Land Systems Division, Sterling Heights, MI, a delivery order amount of $304,985,362 as part of a $351,060,408 cost contract for reset of Abrams M1A2 System Enhancement Package (SEP)v1 to M1A2 SEPv2 tanks and long lead material for the additional reset of M1A2 SEPv1 and M1A2 SEPv2 tanks. Work is expected to be completed on Sept. 30, 2009. The U.S. Army Tank-Automotive and Armaments Command, Warren, MI, is the reporting contract office. (Government Contracts Report Letter No. 1887, December 13, 2006)

Lockheed Martin - $256 Million. Lockheed Martin Aeronautics Co., Marietta, GA, is being awarded a $256,200,000 firm-fixed-price contract modification. This modification is an undefinitized contraction action (UCA) to purchase four C-130J/KC-130J aircraft, as authorized and funded by the FY06 Global War on Terror (GWOT) supplemental authorization. This action will purchase three aircraft in the C-130J configuration and one aircraft in the KC-130J configuration. This UCA will obligate $128,100,000, which equates to 50% of the UCA not-to-exceed of $256,200,000. This work will be complete by April 2010. Headquarters Aeronautical Systems Center, Wright-Patterson Air Force Base, OH, is the contracting activity. (Government Contracts Report Letter No. 1887, December 13, 2006)

Northrop Grumman - $254 Billion. The U.S. Air Force has awarded Northrop Grumman Corporation (NYSE:NOC) two contracts worth a total of $254 million for the E-8C Joint Surveillance Target Attack Radar System (Joint STARS). The contracts cover work on the Joint STARS Total System Support Responsibility (TSSR) sustainment and Joint STARS Extended Test Support (JETS) programs. The $140 million TSSR award is for a seventh year, through 2007, following an initial six-year $810 million contract awarded in 2000, bringing the total cumulative value of the TSSR contract to $950 million. The initial contract included options that could extend Northrop Grumman's participation on this program for more than two decades. Through this TSSR contract, the Air Force has reduced the cost of supporting the E-8C fleet by having the prime contractor, Northrop Grumman, partner with the Warner Robins Air Logistics Center. This cooperative business initiative has been a model for complete life cycle support. The Air Logistics Center and Northrop Grumman use each other's best practices to provide economical Joint STARS support that fully meets the needs of the operational aircraft fleet. Northrop Grumman provides integrated management of all facets of depot maintenance, including some technology refreshment. The Air Logistics Center provides a dedicated management team in concert with software maintenance support, critical parts manufacture and repair of specific mission system items. Under this contract, most of the normal aircraft heavy depot maintenance repair and overhaul, including system upgrade modifications, will continue at the Lake Charles, La. Modification Center operated by Northrop Grumman. The contract also includes subcontract competition and small business participation. The JETS II contract, worth $114 million over four years, provides test support capability for the Joint STARS Improvement Program. JETS II is a continuation of the current $64.8 million JETS program with similar objectives and provisions. The contract provides the critical skill infrastructure and the test assets necessary for the continued evolution and development of the Joint STARS system. The key mission objectives under the JETS II contract include: conducting government testing; providing training and proficiency flights for mission crew and primary aircrew; office facilities for the government Joint Test Force, engineering services; participation in system demonstrations and exercises; and installation, evaluation, demonstration, and testing of potential system modifications and improvements. (Government Contracts Report Letter No. 1887, December 13, 2006)

General Dynamics - $231 Million. General Dynamics C4 Systems, Scottsdale, AZ, won a $230,769,343 modification to previously awarded contract (M67854-02-C-2052) to exercise the options for 49 Regimental Unit Operations Center (UOC) capability sets, and 116 Battalion UOC capability sets. Work is expected to be completed by June 2009. The Marine Corps Systems Command, Quantico, VA, is the contracting activity. (Government Contracts Report Letter No. 1888, December 20, 2006)

Bath Iron Works - $208 Million. Bath Iron Works, Bath, ME, is being awarded a $208,060,756 cost-plus-incentive-fee/ award-fee modification under previously awarded contract (N00024-03-C-2310) to exercise an option for construction of one Flight 0 Littoral Combat Ship (LCS). The LCS will be a networked, agile, and high-speed surface combatant with versatile warfighting capabilities optimized for littoral missions. Work is expected to be completed by August 2009. The Naval Sea Systems Command, Washington, D.C., is the contracting activity. (Government Contracts Report Letter No. 1887, December 13, 2006)

Raytheon - $164 Million. Raytheon Company, Precision Attack and Surveillance Systems, McKinney, TX is being awarded a Cost Plus Incentive Fee (CPIF) contract with a potential maximum value of $164,185,377.00 for system design and development (including an option for six low rate initial production units) of the Silent Knight Radar (SKR) in support of the U.S. Special Operations Command. The work will be performed in McKinney, TX from Jan. 1, 2007 through Dec. 30, 2013. The contract number is H92222-07-C-0041. (Government Contracts Report Letter No. 1888, December 20, 2006)
Johns Hopkins - $164 Million. Johns Hopkins University/Applied Physics Laboratory, Laurel, MD, is being awarded a $164,033,000 (maximum) cost-plus-fixed-fee contract for scientific and engineering research and development support in the areas of ballistic missile defense and related technology, intelligence, and battle management command, control, and communication. The work is expected to be complete by December 2011. The Missile Defense Agency, Washington, DC is the contracting activity. (Government Contracts Report Letter No. 1888, December 20, 2006)

Lockheed Martin - $161 Million. Lockheed Martin Corp., Fort Worth, TX, is being awarded a $161,033,000 firm-fixed-price and time and materials contract to supply F-16 modernization kits to Pakistan. The procurement of 24 modernization kits F-16A Block 15 aircraft and 10 modernization kits F-16A Block 15 aircraft will be accomplished under the firm-fixed price portion of the contract. This work will be complete by November 2010. Headquarters Aeronautical Systems Center, Wright-Patterson Air Force Base, OH, is the contracting activity. (Government Contracts Report Letter No. 1888, December 20, 2006)

Raytheon - $156 Million. Raytheon Co., El Segundo, CA, is being awarded a $156,306,500 cost-plus-fix-fee modification to a previously awarded firm-fixed-price contract (N00019-06-C-0310) for the procurement of 50 Full Rate Production Lot 5 Advanced Targeting Forward Looking Infrared (ATFLIR) pods for the F/A-18C/D and F/A-18E/F aircraft. Work is expected to be completed in November 2009. The Naval Air Systems Command, Patuxent River, MD, is the contracting activity. (Government Contracts Report Letter No. 1888, December 20, 2006)

Raytheon - $121 Million. Raytheon Corp., McKinney, TX, is being awarded a $65,522,957 firm-fixed-price long term requirements Performance Based Logistics (PBL) contract for repair of the P3C Anti-surface Warfare Improvement Aircraft (AIP) APS-137 radar system units. This contract includes a base period of five years, plus one three-year option period and one two-year option period, which if exercised, brings the total estimated value of the contract to $120,731,023. Work is expected to be completed by December 2016. The Naval Inventory Control Point is the contracting activity. (Government Contracts Report Letter No. 1888, December 20, 2006)

Oshkosh Truck - $115 Million. Oshkosh Truck Corp., Oshkosh, WI, was awarded a delivery order amount of $115,121,847 as part of an $115,121,847 firm-fixed-price contract for the rebuild of the M1070 heavy equipment transporter trucks, M1074 and M1075 palletized load system trucks, fuel tank assemblies, and M1076 palletized load system trailers. Work is expected to be completed on Oct. 31, 2008. The U.S. Army Tank-Automotive and Armaments Command, Warren, MI, is the reporting contract office. (Government Contracts Report Letter No. 1887, December 13, 2006)

Northrop Grumman - $104.6 Million. Northrop Grumman Corporation, won a $104.6 million contract to outfit 17 NATO AWACS aircraft with the company's Large Aircraft Infrared Countermeasures (LAIRCM) systems. Under the terms of the contract with the U.S. Air Force's Electronic Systems Center on behalf of the NATO Airborne Early Warning and Control Program Management Organization, Northrop Grumman will commence LAIRCM system deliveries in 2007, with final deliveries expected in 2009. Northrop Grumman's LAIRCM system is a laser-based countermeasures system that operates automatically by detecting a missile launch, determining if it is a threat and activating a high-intensity infrared countermeasure system to track and defeat the threat. (Government Contracts Report Letter No. 1887, December 13, 2006)