Bomber Contract Price Tag Kept Secret in Senate Defense Measure

  • Democrats joined seven Republicans in panel’s vote for secrecy
  • McCain was backed by Cruz in bid to disclose contract value

The U.S. Air Force won a victory in its efforts to keep its new B-21 bomber cloaked in secrecy, as the Senate passed a defense policy bill without a requirement to make public the price tag for the multibillion-dollar contract it gave Northrop Grumman Corp. to build the new aircraft.

The decision against disclosing the contract’s value wasn’t challenged on the Senate floor, where S. 2943, the measure to authorize $602 billion in defense-related programs, was approved Tuesday. Instead, the issue was settled last month, when seven Republicans and all Democrats on the Senate Armed Services Committee joined in a 19-7 vote behind closed doors against making the contract value public, including the fees Northrop could earn.

“The Air Force has already disclosed the per-unit cost of the B-21 -- $556 million in fiscal 2016 dollars,” produced an artist’s conception of the aircraft and released a list of top suppliers, committee chairman John McCain, who unsuccessfully sought disclosure, said in a statement when asked about the vote. The service also has released its $23.5 billion estimate for the development phase of a program that may cost as much as $80 billion depending on how many bombers are eventually built.

Foreign Intelligence

“All of this would seem to be more useful information for a foreign intelligence agency than the overall contract value,” said McCain, an Arizona Republican.

But McCain was opposed by Democrats and independent Angus King. Among his fellow Republicans, McCain was joined in seeking disclosure only by Senators Ted Cruz, Lindsey Graham , Kelly Ayotte, Joni Ernst, Dan Sullivan and Tom Cotton.

Cotton is chairman of the subcommittee with direct oversight of the program, and Ernst’s state, Iowa, is home to Rockwell Collins Inc., a subcontractor on the bomber.

Related story: Senate Adopts $602 Billion Defense Measure

The committee voted to limit disclosure of the contract’s value to lawmakers and their staffs “rather than full public disclosure,” according to a summary in the committee’s report on the fiscal 2017 budget request. The program is “classified because its unique stealth technology is vulnerable to reverse engineering,” Chip Unruh, a spokesman for Senator Jack Reed, the panel’s top Democrat, said in an e-mail.

“Senator Reed and the majority of the committee’s members expect the contract cost to be released as the program reaches technical maturity,” he said. “But no information that could compromise the investments already made should be prematurely released.”

Air Force Secretary Deborah James said on Monday that disclosing “the contract value -- per the experts on these matters,” such as engineers -- “could be a contributing factor” to an adversary deriving information such as “size, weight, power and other factors.”

“We are still in the early days of the B-21,” but the Air Force has revealed more about the new bomber program than what was disclosed at similar stages for its predecessors, the B-1 and B-2, she said.

Previous story: Boeing-Lockheed Said Not Suing Over $80 Billion Northrop Award

While McCain said in the statement that disclosure of the bomber cost is “important given the Air Force’s terrible history of cost overruns in its bomber programs,” Republican Senator James Inhofe said giving the information to Congress is sufficient.

“At this time, the B-21 program and its components are best left classified,” Inhofe said.

In addition to Reed, committee Democrats who voted to keep the number secret were Bill Nelson, Richard Blumenthal, Claire McCaskill, Joe Manchin, Jeanne Shaheen, Kirsten Gillibrand, Joe Donnelly, Mazie Hirono, Tim Kaine and Martin Heinrich.

Republicans who voted with Inhofe against public disclosure were Jeff Sessions, Roger Wicker, Deb Fischer, Mike Rounds, Thom Tillis, and Mike Lee.

The House-passed version of the defense bill, H.R. 4909, is silent on the bomber disclosure issue, so it’s not expected to come up in a House-Senate conference committee that will seek to reconcile differences in the measures, both of which face a White House veto threat on other grounds.

Before it's here, it's on the Bloomberg Terminal.