F-35 Program Office Seeking an Extra $530M to Wrap Up Development

WASHINGTON — The F-35 joint program office (JPO) will need an additional $530 million to complete development of the joint strike fighter program, it confirmed this week.

While no supplemental funding will be needed for fiscal 2017, the JPO will need to request about $530 million more than planned to pay for developmental flight testing and initial operational test and evaluation (IOT&E) flight tests in fiscal 2018 and 2019, said JPO spokesman Joe DellaVedova.

“Most of this needed funding will come from other F-35 JPO funding sources to minimize the impact on the US services and [Department of Defense] overall budget requirements,” he said. “No additional funding will be required from the international partners.”

The program office outlined the new funding requirement during a recent Defense Acquisition Board meeting, Bloomberg News first reported this week.

Half of the $530 million sum will help cover unforeseen issues such as the 2014 engine fire and this year’s delay in testing 3F software, both of which added to schedule risk and cost, DellaVedova said. About $165 million will pay for new requirements that cropped up over the past few years, and $100 million will cover funding that was removed from the F-35 System Development and Demonstration (SDD) program budget line two years ago.

The JPO predicts it can still finish the SDD phase by the end of 2017, but DellaVedova noted that there is approximately three to four months of risk in the schedule that could bump the end of SDD flight testing to the beginning of 2018.

Arizona Republican John McCain, who chairs the powerful Senate Armed Services Committee, bristled against the news that more funding would be needed to wrap up the SDD program, citing an overrun that could be as much as $1 billion.

“I am extremely disappointed to learn of yet another delay in the completion of the System Development and Demonstration phase of the F-35 Joint Strike Program with an associated cost overrun that may be upwards of $1 billion,” he said in a Nov. 3 letter to Defense Secretary Ash Carter. “This latest setback appears to call into question some of the recent determinations and actions of Department of Defense senior leaders regarding the development of this critical but troubled program. ”

The SASC chairman criticized top Air Force and Pentagon officials for making statements about the cost and schedule of the program that now “seem to be inaccurate.” For instance, F-35 program executive officer Lt. Gen. Christopher Bogdan testified to the committee this spring that the SDD phase would conclude by the end of 2017.

“General Bogdan recently stated that while the schedule to conclude the development phase of the F-35 may slip, completion of that phase would require no additional funds,” McCain wrote. “What is perhaps most troubling, however, is that other senior Department leaders appear to have foreseen this latest delay and cost overrun."

The Pentagon’s director of operational test and evaluation, Michael Gilmore, had predicted that the F-35’s development would not be completed on time, pushing IOT&E until mid-2018 at the earliest.

“This warning appears to have been quite prescient,” McCain wrote.

McCain then tasked Carter with answering a list of 10 questions about the cost and schedule of the SDD phase, the budgetary impact to other service priorities, and whether this would result in changes to the F-35’s follow-on modernization program.