Document Number: 2002STATE032990  Channel: n/a      PRINTABLE VERSION

PAGE 01   STATE     032990 202202Z

ORIGIN INL-0O

DRAFTED BY: INL/A: RETHERIDGE -- 02/20/2002 202-776-8806

APPROVED BY: INL: RBEERS

INL: JMACK
INL/RM:   GRECACH INAS
INL/LP:   AMATANO

R 202154Z FEB 02

FM SECSTATE WASHDC
TO AMEMBASSY BOGOTA
AMEMBASSY LA PAZ
AMEMBASSY LIMA

INFO DOS AIR WING PATRICK AFB FL

FOR NAS

E.O. 12958: N/A

TAGS:  SNAR, BL, CO, PE

SUBJECT:  FUNDING FOR INL AVIATION PROGRAMS

REF: A. LA PAZ 121

B.   STATE 16912

1.   THIS IS AN ACTION REQUEST MESSAGE. SEE PARAGRAPH 9.

2.   THE RECENTLY ENACTED FY 2002 BUDGET PROVIDES SIXTY MILLION DOLLARS FOR THE INL/A AVIATION PROGRAM. WHILE THIS REPRESENTS AN INCREASE OVER THE PREVIOUS YEAR’S BUDGET, IT WILL NOT MEET ALL OF THE AVIATION REQUIREMENTS CONVEYED BY POSTS AND/OR DIRECTED BY CONGRESS. BY DESIGN, MUCH OF THE FY 2002 AVIATION SUPPORT FUNDING IS CONTAINED IN ELEMENTS OF THE ANDEAN COUNTERDRUG INITIATIVE THAT WILL BE ALLOTTED TO POSTS.

     INL/A WILL THEREFORE NEED TO COLLABORATE WITH RESPECTIVE NARCOTICS AFFAIRS SECTIONS TO IDENTIFY FUND SOURCES FOR THE VARIOUS AVIATION REQUIREMENTS AND ENSURE UNINTERRUPTED OPERATIONS. THIS CABLE INFORMS POSTS OF FUNDING REQUIREMENTS THAT INL/A SEEKS TO ADDRESS USING COUNTRY PROGRAM FUNDING ASSISTANCE AND REQUESTS COMMITMENTS FROM EACH NAS. WE BELIEVE THAT POSTS HAVE ALREADY ANTICIPATED AND TAKEN INTO CONSIDERATION MANY OF THESE FUNDING REQUIREMENTS IN DEVELOPING THEIR FY 2002 BUDGET PLANS. HOWEVER, SOME OF THE FUNDING ASSISTANCE REQUESTED RESULTS FROM RECENT EVENTS THAT COULD NOT BE ANTICIPATED. AFTER RECEIVING RESPONSES TO THIS MESSAGE, INL/A WILL ASSESS ITS FUNDING POSTURE AND SEEK INL GUIDANCE/ASSISTANCE ON ANY SHORTFALLS THAT WE HAVE NOT BEEN ABLE TO ADDRESS COLLECTIVELY.

3.   INL/A HAS RECEIVED A SIXTY MILLION DOLLAR BUDGET FOR FY 2002 BUT THE COST OF SATISFYING STEADY STATE AVIATION SUPPORT REQUIREMENTS THAT IT IS CHARGED WITH FAR EXCEEDS THAT AMOUNT. THE COST OF MEETING INL/POST AVIATION REQUIREMENTS IS THE SUM OF THE CURRENT NEGOTIATED CONTRACT COST AS OF THE LATEST DEFINITIZED MODIFICATION, THE COST OF SEVERAL PENDING CONTRACT ACTIONS THAT MUST BE ADDED, AND VARIOUS NON-CONTRACT COSTS SUCH AS SALARIES, TRAVEL, PATRICK AIR FORCE BASE SUPPORT, AND DOD-SOURCE AIRCRAFT REPAIR PARTS COSTS. INL/A HAS ANALYZED THESE REQUIREMENTS, MATCHED ALL OF ITS AVAILABLE SIXTY MILLION DOLLAR BUDGET AGAINST THEM IN PRIORITY ORDER, AND IDENTIFIED THE UNFUNDED REQUIREMENTS IT MUST OBTAIN FINANCIAL ASSISTANCE FOR (OR RELIEF FROM).

4.   UP UNTIL THIS POINT, ALTHOUGH INL/A HAS BEEN AWARE THAT REQUIREMENTS WOULD EXCEED ITS OWN BUDGET CAPABILITY, IT HAS NOT SOUGHT OUTSIDE FUNDING ASSISTANCE. THIS IS BECAUSE OF THE "CONTINUING RESOLUTION" STATUS THAT HAS EXISTED UNTIL RECENTLY, AND THE REQUIREMENT TO MEET ADDITIONAL NOTIFICATION AND CERTIFICATION ACTIONS BEFORE FY 2002 FUNDS CAN BE AVAILABLE. ACCORDINGLY, INL/A HAS BEEN FUNDING ITS CONTRACT INCREMENTALLY AT A REDUCED LEVEL. ONE RESULT THAT THE UNDERFUNDING OF THE CONTRACT HAS HAD IS THAT MATERIAL PURCHASES HAVE HAD TO BE STRICTLY CURTAILED, THEREFORE REDUCING THE STOCKAGE OF PARTS AND COMPONENTS BELOW REQUIRED LEVELS. INL/A IS CURRENTLY ORDERING ONLY THOSE REPAIR PARTS THAT GROUND AIRCRAFT, AND IS NOT ORDERING PARTS FOR MORE ROUTINE MAINTENANCE REQUIREMENTS OR THE REPLENISHMENT OF STOCKS. THIS DEPLETION OF STOCKS, IF NOT REVERSED, WILL ADVERSELY IMPACT AIRCRAFT OPERATIONAL READINESS RATES AND FUTURE POST-DIRECTED MISSIONS.

5.   THE SPECIFIC PROJECTS THAT CANNOT BE FUNDED WITHIN THE SIXTY MILLION DOLLAR AIR WING BUDGET WILL BE DETAILED IN THE PARAGRAPHS THAT FOLLOW, BUT THERE ARE SEVERAL DEVELOPMENTS THAT HAVE INCREASED AIR WING COSTS. FOR EXAMPLE, THE ENTIRE UH-1H FLEET REQUIRES REPAIRS ASSOCIATED WITH THE PROBLEMATIC, AGING T-53-L13-B ENGINE WHICH HAS BEEN THE SUBJECT OF MANY GROUNDING MESSAGES AND WHICH RECEIVES LITTLE SUPPORT FROM THE DOD SYSTEM DUE TO PLANNED PHASEOUT/OBSOLESCENCE. THERE IS LITTLE ROOM TO FURTHER DEFER THESE ENGINE REPAIRS WITHOUT JEOPARDIZING SAFETY AND RELIABLE MISSION PERFORMANCE, SO WE MUST DO HALF OF THESE REPAIRS THIS YEAR AND HALF THE FOLLOWING YEAR. WE ALSO MUST ACCOMPLISH TWENTY OV-10D PROPELLER OVERHAULS. THERE ARE ALSO MANY EXPANDED ACTIVITIES DIRECTLY ASSOCIATED WITH PLAN COLOMBIA THAT ARE NOT FUNDED WITHIN THE AIR WING BUDGET (COLOMBIA MULTI-SPECTRAL IMAGING SYSTEM, FOR EXAMPLE). ANOTHER MAJOR FACTOR IS A ONE HUNDRED AND FIFTY PERCENT INCREASE IN DEFENSE BASE ACT (DBA) INSURANCE COSTS (ASSOCIATED DIRECTLY WITH CONTRACTOR PERSONNEL SERVING OVERSEAS) WHICH AMOUNTS TO ALMOST FOUR MILLION DOLLARS WHICH WAS AN UNANTICIPATED DIRECT RESULT OF RISK/RATE ADJUSTMENTS FOLLOWING THE SEPTEMBER ELEVENTH TERRORIST ATTACKS. THESE SITUATIONS, ALONG WITH OTHERS, COMBINE TO PRESENT A SERIOUS SHORTFALL. INL/A SEEKS ASSISTANCE FROM COUNTRY PROGRAMS THAT ARE CUSTOMERS OF AIR WING SERVICES TO MAKE UP THE BUDGET GAP AS MUCH AS POSSIBLE. THE FOLLOWING PARAGRAPHS PROVIDE ADDITIONAL DETAILS AS THEY PERTAIN TO SPECIFIC COUNTRY PROGRAMS.

FUNDING ASSISTANCE REQUESTED FROM NAS BOGOTA

6.   INL/A REQUESTS COLOMBIA COUNTRY PROGRAM FUNDING SUPPORT FOR THE FOLLOWING ITEMS (SOME OF WHICH ARE COMPONENTS OF THE COLOMBIA SEGMENT OP THE ACI) THROUGH THE END OF FY 2002:

A.   CONTINUED FUNDING OF ONE OF TWO C-27 AIRPLANES STATIONED IN COLOMBIA, PER PREVIOUS AGREEMENT. ESTIMATED COST FOR THE REMAINDER OF FY 2002 IN ADDITION TO FUNDING ALREADY PROVIDED THROUGH NOVEMBER 2001: $1.8M.

B.   OV-10 PROPELLER OVERHAUL COSTS: $l.3M.

C.   (OPTIONAL): ACQUISITION OF THE NINTH AIR TRACTOR AT-802 SPRAY PLANE. (NOTE: FY 2000 EMERGENCY SUPPLEMENTAL AND REPROGRAMMED FY 1999 EMERGENCY SUPPLEMENTAL FUNDS WERE SUFFICIENT TO PROCURE ONLY EIGHT OF NINE PLANNED PLANES). COST FOR THE NINTH PLANE, LESS AVAILABLE REMAINING EMERGENCY SUPPLEMENTAL FUNDS, WOULD BE $1.4M.

D.   OPERATIONS AND MAINTENANCE COSTS FOR "ADDITIONAL SPRAY AIRCRAFT" (FOUR OV-1OD AND NINE AT-802) FOR REMAINDER OF FY 2002 THAT CANNOT BE COVERED BY REMAINING FY 2000 EMERGENCY SUPPLEMENTAL FUNDS: $9.2M ($6.2M FOR OV-10, AND $3M FOR LATE FY AT-802 COSTS).

E.   SPRAY PILOT TRAINING (IN ADDITION TO THE $2M PREVIOUSLY PROVIDED) FOR THE REMAINDER OF FY 2002: $l.5M.

F.   COLAR UH-1N CONTRACT COSTS FOR REMAINDER OF FY 2002 THAT CANNOT BE COVERED BY REMAINING FY 2000 EMERGENCY SUPPLEMENTAL FUNDS: $21.7M.

G. COLAR UH-1N DOD PARTS REQUISITION COSTS (THROUGH FORT STEWART SUPPORT AGREEMENT): $1.4M.

H.   COLAR HUEY-II CONTRACT COSTS FOR REMAINDER OF FY 2002 THAT CANNOT BE COVERED BY REMAINING FY 2000 EMERGENCY SUPPLEMENTAL FUNDS: $lO.7M.

I.   COLAR HUEY- II DOD PARTS REQUISITION COSTS (THROUGH FORT STEWART SUPPORT AGREEMENT): $0.6M.

J. EQUITABLE ADJUSTMENT FOR MULTI-SPECTRAL IMAGING SYSTEM (MDIS) CAMERA REQUIREMENTS: $l.3M.

K. INCREASE IN DBA INSURANCE: $3.4M.

L. OTHER CONTRACT COST INCREASES ASSOCIATED WITH PLAN COLOMBIA: $6.48M.

M.   TOTAL: $60.78M INCLUDING OPTIONAL NINTH AT-802. (NOTE: THIS AMOUNT INCLUDES NO/NO UH-60 RELATED COSTS SINCE THERE IS CURRENTLY NO INL/A BUDGET/CONTRACT CONNECTION WITH THAT PROJECT. ALSO, IT DOES NOT INCLUDE SEPARATE DYNCORP TASK ORDER ARRANGEMENTS WITH POST WHICH CONTINUE TO BE NAS-FUNDED).

FUNDING ASSISTANCE REQUESTED FROM NAS LA PAZ

7.   INL/A REQUESTS BOLIVIA COUNTRY PROGRAM FUNDING SUPPORT FOR THE FOLLOWING ITEMS THROUGH THE END OF FY 2002:

A.   CONTINUED FIXED WING SUPPORT COST REIMBURSEMENT PER PREVIOUS AGREEMENT, IN ACCORDANCE WITH FLYING HOUR LEVELS STATED IN REF A: $0.7M FOR FY 2002.

B.   FUNDING TO ADDRESS APPROXIMATELY HALF OF THE ENGINE AND TAIL BOOM PROBLEMS ON POST’S UH-1H FLEET: BEGINNING IN THE YEAR 2004, THERE WILL BE NO DOD SUPPORT OF THE UH-1H HELICOPTER. INL/A HAS PLANS TO BRING MAJOR COMPONENTS OF THE UH-1H INTO COMPLIANCE WITH ORIGINAL EQUIPMENT MANUFACTURER SPECIFICATIONS BY THAT TIME IN ORDER TO PRECLUDE GROUNDING OF AIRCRAFT. ENGINES AND TAIL BOOMS ARE THE PRIMARY ISSUE.

     DURING FY 2002 WE MUST REPAIR HALF OF THE TAIL BOOMS TO AVOID FREQUENT RECURRING X-RAY INSPECTIONS AND ALSO MUST UPGRADE NINE ENGINES (INCLUDING SPARES) TO MEET COMMERCIAL SPECIFICATIONS. THESE ARE THE MINIMUM REPAIRS REQUIRED. WE PREFER TO GO BEYOND THAT ON AS MANY AIRFRAMES AS POSSIBLE BY MODIFYING THEM TO FULL HUEY-II CONFIGURATION. WE UNDERSTAND POST ALREADY HAS PLANS TO FUND SOME NUMBER OF THESE MODIFICATIONS. WITH THE FULL HUEY-II UPGRADE, POST RECEIVES AN AIRCRAFT THAT HAS BETTER LIFT, REQUIRES FEWER MAINTENANCE MANHOURS, HAS MORE TIME BETWEEN OVERHAULS, AND IS FRESHLY REFURBISHED. THE EXTENT OF REPAIR OR MODIFICATION IS UP TO POST, BASED ON FUNDING ABILITY AND PREFERENCE. WE SEEK THE REPAIR OF NINE UNITS. UNIT COST IS $0.32M FOR BASIC REPAIRS OR $2.0M FOR THE HUEY-II MODIFICATION. WE ARE THEREFORE REQUESTING BETWEEN $2.9M AND $18M, DEPENDING ON POST’S PREFERRED MIX. (NOTE: THIS ESTIMATE ASSUMES NO GROWTH IN THE BOLIVIA HUEY FLEET. IF POST ENVISIONS THAT HUEY-II HELICOPTERS WOULD AUGMENT, RATHER THAN REPLACE, EXISTING UH-1H HELICOPTERS, THE FUNDING REQUIRED WOULD BE GREATER).

C.   INCREASE IN DBA INSURANCE: $0.2M

D. TOTAL: BETWEEN $3.SM AND $18.9M, DEPENDING UN POST‘S PREFERENCES ON UH-1H REPAIR/MODIFICATION. (NOTE:    THIS DOES NOT INCLUDE SEPARATE DYNCORP TASK ORDER ARRANGEMENTS WITH POST WHICH CONTINUE TO BE NAS-FUNDED).

            FUNDING ASSISTANCE REQUESTED FROM NAS LIMA

8. INL/A REQUESTS PERU COUNTRY PROGRAM FUNDING SUPPORT FOR THE FOLLOWING ITEMS THROUGH THE END OF FY 2002:

A. CONTINUED C-27 FIXED WING SUPPORT COST REIMBURSEMENT PER PREVIOUS AGREEMENT: $1.9M.

B. FUNDING TO ADDRESS APPROXIMATELY HALF OF THE ENGINE AND TAIL BOOM PROBLEMS ON POST’S UH-1H FLEET: THERE WILL BE NO DOD SUPPORT TO THE UH-1H HELICOPTER BEGINNING IN THE YEAR 2004. INL/A HAS PLANS TO BRING MAJOR COMPONENTS OF THE UH-1H INTO COMPLIANCE WITH ORIGINAL EQUIPMENT MANUFACTURER SPECIFICATIONS BY THAT TIME IN ORDER TO PRECLUDE GROUNDING OF AIRCRAFT. ENGINES AND TAIL BOOMS ARE THE PRIMARY ISSUE.

     DURING FY 2002 WE MUST REPAIR HALF OF THE TAIL BOOMS TO AVOID FREQUENT RECURRING X-RAY INSPECTIONS AND ALSO MUST UPGRADE NINE ENGINES (INCLUDING SPARES) TO MEET COMMERCIAL SPECIFICATIONS. THESE ARE THE MINIMUM REPAIRS REQUIRED. WE PREFER TO GO BEYOND THAT ON AS MANY AIRFRAMES AS POSSIBLE BY MODIFYING THEM TO FULL HUEY-II CONFIGURATION. WE UNDERSTAND POST ALREADY HAS PLANS TO FUND SOME NUMBER OF THESE MODIFICATIONS. WITH THE FULL HUEY-II UPGRADE, POST RECEIVES AN AIRCRAFT THAT HAS BETTER LIFT, REQUIRES FEWER MAINTENANCE MANHOURS, HAS MORE TIME BETWEEN OVERHAULS, AND IS FRESHLY REFURBISHED. THE EXTENT OF REPAIR OR MODIFICATION IS UP TO POST, BASED ON FUNDING ABILITY AND PREFERENCE. WE SEEK THE REPAIR OF NINE UNITS. UNIT COST IS $0.32M FOR BASIC REPAIRSOR $2.0M FOR THE HUEY-II MODIFICATION. WE ARE THEREFORE REQUESTING BETWEEN $2.9M AND $18M, DEPENDING ON POST’SPREFERRED MIX. (NOTE: THIS ESTIMATE ASSUMES NO GROWTH IN THE PERU HUEY FLEET. IF POST ENVISIONS THAT HUEY-II HELICOPTERS WOULD AUGMENT, RATHER THAN REPLACE, EXISTING UH-1H’S HELICOPTERS, THE FUNDING REQUIRED WOULD BE GREATER).

C.   INCREASE IN DBA INSURANCE: $0.2M

D. FUNDING FOR INITIAL PARTS STOCKAGE AND CONTRACT SUPPORT FOR ADDITIONAL C-208 RECENTLY ACQUIRED BY NAS (SEE REF B): $O.7M.

E. TOTAL: BETWEEN $5.7M AND $20.8M, DEPENDING ON POST’S PREFERENCES ON UH-1H REPAIR/MODIFICATION. (NOTE: THIS DOES NOT INCLUDE SEPARATE DYNCORP TASK ORDER ARRANGEMENTS WITH POST WHICH CONTINUE TO BE NAS-FUNDED; IT ALSO DOES NOT INCLUDE K-MAX REQUIREMENTS, FOR WHICH ADEQUATE FUNDING REMAINS FROM THE FY 2000 EMERGENCY SUPPLEMENTAL APPROPRIATION).

ACTION REQUESTED

9.   IN ORDER TO FACILITATE TIMELY ACTIONS WITH RESPECT TO THE DYNCORP CONTRACT AND HUEY-II PRODUCTION ACTIVITIES, INL REQUESTS THAT POSTS PROVIDE THE FOLLOWING INFORMATION NO LATER THAN MARCH 8, 2002:

A. ABILITY AND WILLINGNESS OF NAS TO PROVIDE FUNDING AS REQUESTED IN RELATED PARAGRAPHS FOUR THROUGH SIX ABOVE. (LA PAZ AND LIMA, PLEASE SPECIFY POST PLANS WITH REGARD TO HUEY-II MODIFICATIONS THAT IT WILL FUND, AND THE EXTENT TO WHICH SUCH MODIFIED AIRCRAFT WILL REPLACE, RATHER THAN AUGMENT, EXISTING AIRFRAMES).

B.   (TO THE EXTENT POSTS ARE UNABLE TO PROVIDE THE FULL AMOUNT REQUESTED) NAS RECOMMENDATIONS ON WORK REQUIREMENT REDUCTIONS THAT CAN BE MADE IN ORDER TO REDUCE FUNDING SHORTFALLS.

10.  INL/A POC IS BOB ETHERIDGE, (202) 776-8806. POWELL

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