Israel’s Iron Dome Defense in Line for Tripled U.S. Aid

July 17 (Bloomberg) -- Retired Israeli Brigadier General Danny Gold discusses the Iron Dome missile-defense system which he helped develop. He talks with Elliott Gotkine in Tel Aviv on Bloomberg Television's "The Pulse." (Source: Bloomberg)

Israel’s Iron Dome missile-defense system may end up getting triple the U.S. funding that the Defense Department sought for it in March.

“Iron Dome has saved countless Israeli lives,” Defense Secretary Chuck Hagel told Senate Majority Leader Harry Reid in a letter dated yesterday, as global airlines suspended flights to Tel Aviv because of rocket fire.

Senate leaders want to give the Pentagon an immediate $225 million for the U.S.-funded, Israeli-built system, then more money in the fiscal year that begins Oct. 1.

The added $225 million for the current fiscal year would be used “to accelerate production of Iron Dome components in Israel to maintain adequate stockpiles,” Hagel said in the letter.

The money -- which would be included in an emergency spending bill directed mostly at child-migration issues on the U.S.-Mexico border -- would be in addition to the $351 million that’s already under discussion for Iron Dome in fiscal 2015. It would bring the potential new funding to $576 million, compared with the $176 million requested by the Pentagon for the year that begins Oct. 1.

While lawmakers have pressed for U.S. companies to get a share of Iron Dome funding, they wouldn’t benefit from the $225 million, according to Hagel.

Photographer: David Buimovitch/AFP via Getty Images

A missile is launched by an "Iron Dome" battery, a short-range missile defence system designed to intercept and destroy incoming short-range rockets and artillery shells, on July 9, 2014 in the southern Israeli city of Ashdod, neighboring the Gaza Strip. Close

A missile is launched by an "Iron Dome" battery, a short-range missile defence system... Read More

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Photographer: David Buimovitch/AFP via Getty Images

A missile is launched by an "Iron Dome" battery, a short-range missile defence system designed to intercept and destroy incoming short-range rockets and artillery shells, on July 9, 2014 in the southern Israeli city of Ashdod, neighboring the Gaza Strip.

Israel estimates that it would take two to three years to reach full co-production capacity in the U.S., “which would not address Israel’s current shortfall,” Hagel wrote.

An agreement with Israel calls for more than half the funds the Pentagon provides for Iron Dome to be spent in the U.S.

Raytheon’s Role

Iron Dome is built by Rafael Advanced Defense Systems Ltd. and is designed to intercept and destroy rockets capable of flying as far as 70 kilometers (44 miles).

Raytheon Co. (RTN), based in Waltham, Massachusetts, is under contract with Haifa-based Rafael to find suitable U.S. suppliers.

Senate Appropriations Committee Chairwoman Barbara Mikulski, a Maryland Democrat who also received a copy of the request, said yesterday that the Senate would include the funding in its version of the planned emergency supplemental. Mikulski’s committee previously marked up a draft fiscal 2015 spending bill that would give the Pentagon all of the $176 million it initially sought for Iron Dome, plus an additional $175 million.

In addition, Hagel’s letter went to Senate Republican leader Mitch McConnell of Kentucky and Richard Shelby of Alabama, the top Republican on the Senate Appropriations Committee, as well as to the leaders of the Armed Services committee and the Appropriations Defense subcommittee.

To contact the reporter on this story: Roxana Tiron in Washington at rtiron@bloomberg.net

To contact the editors responsible for this story: Katherine Rizzo at krizzo5@bloomberg.net Larry Liebert

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