_Aerospace Daily

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The Senate Armed Services Committee has passed a fiscal year 1998 defense authorization bill that provides $268.2 billion in budget authority, an increase of $2.6 billion over the president's budget request. Despite earlier warnings that the budget would be too tight in FY '98 for program increases, the committee was able to boost funding several programs. Compared to last year, however, the increases appear modest. Congress passed a $244 billion FY '97 defense appropriations bill - $9.4 billion more than President Clinton requested.

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Delta Air Lines and Solair have signed a memorandum of understanding that will make the Banner Aerospace subsidiary Delta's sole supplier of airframe rotables, repairables and expendables from the surplus market. The deal, subject to negotiation of a definitive agreement, could yield revenues totaling $150 million in three years, said Timothy Daggett, president of Solair, which has facilities in Atlanta and Lakeland, Fla.

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NASA is using its financial reserves on the International Space Station program "at a substantial rate," and is in danger of running short before the end of the current fiscal year if its plans to accommodate cost overruns from poor performance by Russia and prime contractor Boeing don't pan out, the General Accounting Office says in testimony prepared for a Senate hearing.

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HAND ME DOWNS: If the U.S. Air Force decides to replace its LANTIRN system with a new pod, Guard and Reserve units, which have sought LANTIRN-type capability for some time, might benefit by getting the older systems, according to one AF official.

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ON THE SAME TEAM: Lyles says he's disturbed by reports from Capitol Hill that suggest industry officials aren't playing on the same team with government officials on the same programs. Lyles, speaking with reporters, isn't specific, but he says members of Congress tell him they hear one story from industry and another from government. It's time for everyone to stop trying to explain themselves and work together, he says.

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More than 8,000 rotorcraft worth nearly $52 billion will be built in the next 10 years, Teal Group analysts predicted yesterday at the Paris Air Show. The first world rotorcraft forecast of Teal Group, Fairfax, Va., predicts the numbers will be made up of 4,635 aircraft worth $10.9 billion for civilian use and 3,555 military rotorcraft worth $40.8 billion. The civil market will remain flat, but the military market, at its lowest point in more than a decade, will see some growth, Teal said.

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BOLSTERING BUFFS: Long-term U.S. Air Force budgets show first funding of a new new electronic countermeasures suite for the B-52 bomber in fiscal 2004, AF officials say. That's around the time the service sees the threat beginning to outmatch the B-52's self-protection systems, one of which is the ALQ-172 jammer. But AF officials also say that if the budget gets a boost before 2004, the enhancement could begin then.

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PAC-4 POSSIBILITIES: Ballistic Missile Defense Organization Director Lt. Gen. Lester Lyles says he won't commit now to pursuing a PAC-4 or PAC-5 missile system over the next 10 years, but expects at least a pre-planned product improvement program to upgrade PAC-3. Meanwhile, he says he hopes to work with the Navy to get an Upper Tier missile defense capability to troops in the field, possibly by 2007.

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The Senate Armed Services Committee has written into its fiscal 1998 defense authorization "a specific prohibition" against authorizing unrequested funding for the B-2 bomber industrial base, considered the first step in resuming production of additional B-2s, ranking Democrat Carl Levin (Mich.) said Friday. Levin, in discussing Thursday's markup of the defense bill, pointedly told reporters that the action went beyond mere silence.

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Two units of Hughes Electronics will pay $500,000 to settle allegations involving military contracts. The U.S. Justice Dept. claimed Hughes Aircraft Co. and Hughes Aircraft Mississippi defrauded the government by not properly testing certain components of torpedoes as required under a military contract, and also used non-conforming fasteners under several other Dept. of Defense contracts. Investigators discovered that Hughes failed to properly test certain electronic components of Advanced Capacity Mk. 48 torpedoes for the U.S. Navy.

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Senate Armed Services Committee actions on major programs in the Pentagon's fiscal year 1998 budget request are listed in the following tabulation, released Friday by the committee. FY'98 Request Committee Change Recommendation Qnty Cost Qnty Cost Qnty Cost Procrmnt ($Ms) Tot. Procrmnt 42,607.11 4,228.17 46,835.28 Highlights

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STAY LOOSE: Astronauts and cosmonauts on the International Space Station will need plenty of flexibility and ingenuity to deal with unexpected problems that arise, according to Jerry Linenger. Linenger should know, having just returned from an eventful 132-day stint on Russia's Mir orbital station, where he and his Russian colleagues battled everything from a leaky cooling system to a smoky fire. "Things will happen when you're out on the outpost that you need to take care of," Linenger tells reporters Friday.

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LETHAL WEAPONS: Threats "are getting worse," Lyles says. Lethality of weapons used by Iraq during the Gulf War was significantly less than that of weapons available today to potential adversaries of the U.S., he says. Improvements in lethality and accuracy "hold my attention" and show "how serious this problem really is," Lyles says. He's also concerned about the improved resolution of satellite imagery. In the next 10 years, he predicts, imagery with resolution down to inches "will be available to anyone who wants to pay for it."

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HUGHES AIRCRAFT CO. unit has won a $5 million contract to supply laser warning systems for British EH-101 helicopters through prime contractor GKN Westland. The deal marks the first sale for Hughes Danbury Optical Systems of its AVR-2A(V) laser detection system.

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The House last week passed a $6.1 billion 1998 State Dept. authorization bill, with an attached provision cutting off aid to the Russian Federation if it transfers SS-N-22 anti-ship cruise missile systems to the People's Republic of China. The amendment, proposed by Rep. Dana Rohrabacher (R-Calif.), passed by a voted of 244-184. It cuts $95 million in U.S. foreign assistance to Russia for FY '98, and FY '99 if Russia transfers the missiles to China.

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Aerospace/Defense Stock Box As of closing June 13, 1997 Closing Change UNITED STATES DowJones 7782.04 + 70.57 NASDAQ 1423.03 + 11.71 S&P500 893.27 + 9.81 AARCorp 32.125 + .125 AlldSig 81.375 - .625 AllTech 50.625 + .625

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SENATE SNAG: Although the Senate Armed Services Committee approved the defense authorization last week, ranking Democrat Carl Levin (Mich.) sees the change it made to allow 50% of military repair and maintenance work to be done in the private facilities starting in calendar 1998 as potentially "a major impediment" to floor action. The change, favored by Defense Secretary William S.

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The Senate Armed Services Committee, in its fiscal year 1998 authorization bill, let stand a $420 million cut in the Air Force's F-22 fighter program proposed by the SASC air-land subcommittee. The cut reduces the Air Force's $2 billion request to about $1.5 billion (DAILY, June 12).

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A joint U.S. Army/Navy effort to prove the concept of a lethal unmanned aerial vehicle could be demonstrated in 18 to 24 months using the Amber UAV and the Hellfire missile, officials said here last week.

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After restoring all but $752 million of a $2.1 billion request in F/A- 18E/F Super Hornet procurement and deferring a battle over an unrequested $329 million first step in renewed B-2 bomber production, the House National Security Committee yesterday approved a $269 billion fiscal 1998 defense authorization. This was $2.6 billion above the Clinton Administration's request and at the congressional budget resolution ceiling (for a table detailing HNSC actions on major programs, see page 415).

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Program managers in the individual U.S. military services aren't doing enough to ensure the missile defense programs they manage are interoperable, and it's time for them to "expand their horizons," Lt. Gen. Lester Lyles, director of the Pentagon's Ballistic Missile Defense Organization, said yesterday. BMDO has brought the issue to the attention of the service leaders and "we're going to provide additional direction," Lyles said. Interoperability will become even more significant as the Pentagon defines a cruise missile defense architecture, he noted.

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The Defense Dept. has expressed restrained approval of the House National Security Committee's decision to ease up on cuts proposed by its procurement subcommittee to the U.S. Navy's F/A-18E/F Super Hornet program (see story on page 411). Pentagon spokesman Navy Capt. Michael Doubleday said yesterday that "We're heartened to see the committee has provided funding for the program." He said that "this is a step in the right direction."

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GOVERNMENT OF AUSTRALIA has identified six competitors from whom it will pick a supplier of electronic warfare equipment for several of its aviation platforms. The Australian defense department said the potential prime contractors for Project Echidna are British Aerospace Australia; a team of Israel's Elta and Elisra; Lockheed Martin; Northrop Grumman; Raytheon E- Systems, and Rockwell - ASTA Defense, now part of Boeing. The program calls for self-protection systems for Australia's F-111s, C-130Js, Black Hawks, Chinooks and Sea Kings.

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BFGOODRICH CO. completed the sale of its Aerospace Engine Electrical Systems Div., Norwich, N.Y., to Unison Industries. Terms were not disclosed. The business, which produces electrical equipment and wiring harnesses in Norwich and Forth Worth, Tex., employs 578 and had 1996 sales of $60 million. Unison, Jacksonville, Fla., makes engine electrical components.

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Hughes Space and Communication International Inc., Los Angeles, won a contract from Nordiska Satellitaktiebolaget (NSAB) to build a telecommunications satellite and provide ground station support services, Hughes announced yesterday. Financial terms were not disclosed. The satellite, Sirius 3, will be an HS 376 high-power model and will provide direct-to-home television services for Scandinavia. Hughes will also upgrade NSAB's satellite control center, Esrange, Kiruna, and provide training to the controllers.