March 19, 2020 | International, Aerospace
By: Aaron Mehta
WASHINGTON — A U.S. State Department fund to help European nations replace Russian-made weapons with American equipment has expanded to eight countries, but will be eschewing a second wave of funding in favor of targeted investments.
In 2018, the State Department quietly launched a new effort known as the European Recapitalization Incentive Program, or ERIP, a new tool developed alongside U.S. European Command to speed up the process of getting allied nations off Russian gear. The U.S. benefits both strategically — getting partners and allies off Russian equipment to improve interoperability and deny Moscow funds for maintenance — and financially, thanks to the sale of American weapons abroad.
ERIP funds, reprogrammed from unused dollars such as regional Foreign Military Financing, come in one-time bursts to help a country buy American-made alternatives to Russian kit. To get the money, the European nation must pledge to not buy Russian equipment in the future, while also at least matching the dollar value of the ERIP grant with domestic funding.
The initial funding round consisted of six countries, totaling $190 million in reprogrammed fiscal 2017 dollars. As of last May, the State Department was considering a second round of ERIP grants and was at least in early discussions with Latvia about the funding.
But in the time since, the department decided there won't be a second round, but rather ERIP will become a tool best used on a rolling basis. (Discussions with Latvia turned to different pots of money other than ERIP, according to a source.)
“There was a lot of discussions about a second round, but the way it's kind of evolving is, rather than look at it as rounds is, look at it as opportunities,” a senior State Department official told Defense News on condition of anonymity. “It's a tool that we can use when opportunities arise for us to work with a partner to make a difference.”
All told, the department has given out roughly $277 million in ERIP grants in the last two years — but, the official said, those relatively small dollars helped lock in roughly $2.5 billion in U.S. weapons sales. That's a win in “pure economic terms,” the official said, even before getting into the hard-to-quantify policy and political benefits.
“It was a pretty bold decision in trying to help some of these countries acquire a pretty high capability capital intensive, and for some of them it's their first major [Foreign Military Sales] case, period.”
Going forward, there may be tie-in money from EUCOM, which could kick in $1-3 million in small grants to nations that received ERIP dollars in order to help nations with maintenance costs on the newly bought American equipment. That money would likely come from DoD's Section 333 authority.
Asked about that potential. DoD spokesman Lt. Col. Uriah Orland said the department "continues to work closely with the Department of State in the planning of security assistance with our European partner nations that enables them to reduce their dependencies on Russia's defense industry and build and/or sustain their own defense capabilities.”
Targeted, ongoing funding
Bulgaria presents a notable example for how the thinking on ERIP is evolving. The country spent several years debating what fighter jet to purchase, with the finalists coming down to new F-16s from Lockheed Martin, secondhand F-16s from Portugal, Eurofighter Typhoons from Italy and Saab Gripens from Sweden.
As ERIP was envisioned, it would be used only for rotorcraft or ground vehicles. But with the government in Sofia teetering on the edge of rejecting the Lockheed deal, the U.S. State Department stepped in and used $56 million in ERIP dollars to push the F-16s over the edge and finalize a deal that could exceed $1.6 billion in costs.
“For countries where it's a politically contentious issue, whether for economic or political reasons” the fund can help make a deal happen, the official said. “We were able to close that gap with an ERIP grant that enabled them to make the purchase and acquire the capability.”
The second nation to get a targeted ERIP grant has been Lithuania, which in October announced plans to buy six UH-60 Black Hawk helicopters to replace its Soviet-made Mi-8 fleet. The State Department kicked in $30 million of ERIP funding to help complete that deal.
In fact, no one piece of equipment has benefited from ERIP as much as the UH-60, of which three of the eight ERIP grants has helped procure. The eight projects to date are:
All of those deals except Greece and Lithuania are under contract, with a letter of request from Lithuania expected in the next few weeks.
As to future opportunities, “we always kind of have our eye open, and we rely on the country teams out in the field to bring us these opportunities and think about them,” the official said. Although at the moment there are no potential ERIP projects in the works.
“We continue to look at the Baltics, we look at the Balkans,” the official said, adding that “countries within Eastern Europe, the Baltics, the Balkans moving towards a new ground mobility or rotorwing systems with something to divest would be our top candidates.”
All of those deals except Greece and Lithuania are under contract, with a letter of request from Lithuania expected in the next few weeks.
As to future opportunities, “we always kind of have our eye open, and we rely on the country teams out in the field to bring us these opportunities and think about them,” the official said. Although at the moment there are no potential ERIP projects in the works.
“We continue to look at the Baltics, we look at the Balkans,” the official said, adding that “countries within Eastern Europe, the Baltics, the Balkans moving towards a new ground mobility or rotorwing systems with something to divest would be our top candidates.”
October 22, 2021 | International, Naval
With the offshore patrol cutter slated to get a top-of-the-line C5ISR system, Northrop Grumman and its industry partners will work through integrating the whole system at this spacious new facility ahead of installing the gear onto the ship hulls themselves, to catch any integration hiccups early and save time and money during sea trials.
February 3, 2020 | International, Aerospace, Naval, Land, C4ISR, Security
Mark Pomerleau The Pentagon has finalized the long anticipated cybersecurity standards contractors will have to follow before winning contracts from the Department of Defense, a new process called the Cybersecurity Maturity Model Certification (CMMC) 1.0. The model is a tiered cybersecurity framework that grades companies on a scale of one to five based on the level of classification and security that necessary for the work they are performing. “The government and the contractor community must keep working together to address real and growing cybersecurity threats, and we need a robust response to protect our infrastructure, information, and supply chains,” said David Berteau, president and chief executive of the Professional Services Council, a trade association for federal contractors. “With today's announcement, DoD has achieved a significant milestone. Here's what industry officials need to know about the version finalized Jan. 31. Why it was needed Previously, the Pentagon did not have unified standard for cybersecurity that businesses needed to follow when bidding for contracts. Companies could claim to meet certain industry standards for cybersecurity, but those assertions were not tested by auditors, nor did the standards take into account the type of work a company was bidding to complete. Since then, defense officials have said that cybersecurity is not a one size fits all approach. In the meantime, adversaries have discovered it is easier to target unsuspecting down tier suppliers, rather than prime contractors. “Adversaries know that in today's great power competition environment, information and technology are both key cornerstones and attacking a sub-tier supplier is far more appealing than a prime,” Ellen Lord, the under secretary of defense for acquisition and sustainment, told reporters in a briefing at the Pentagon Jan. 31. Officials have said cyber theft by adversaries costs the United States about $600 billion a year. What will change? Contracts will mandate bidders reach a certain level of certification to win specific jobs. For example, if businesses aren't bidding on a contract that has extremely sensitive information, they must only achieve the first level of certification, which involves basic cybersecurity such as changing passwords and running antivirus software. More sensitive programs will require more stringent controls. Smaller companies down the supply chain will not, however, have to have the same level of certification as primes, said Katie Arrington, chief information security officer for the Office of the Under Secretary of Defense for Acquisition and the point person for the certification. Another significant change with the new process is the creation of an accreditation board and assessors. The board is an outside entity, separate from DoD, that will be charged with approving assessors to certify companies in the process. The accreditation body was formed earlier this month and officials are working on identifying and training the assessors, which will be called Certified Third-Party Assessment Organizations (C3PAO). What's next? Officials explained Jan. 31 that CMMC will follow a crawl, walk, run approach to ensure companies aren't unprepared for the change. The accreditation board is in the process of training the auditors that will oversee the certificaion. Once the requirements are met, a company's certification is good for 3 years. In the meantime, DoD plans to release 10 requests for information and 10 requests for proposals that will include the new cyber standards this year. The first solicitation could come as early as June. Arrington said earlier this week that she expects 1,500 companies to be certified by the end of 2021. She added that all new contracts starting in fiscal year 2026 will contain the cybersecurity requirements, however, Lord noted that they will not be not retroactive to previous contracts. https://www.fifthdomain.com/dod/2020/01/31/pentagon-finalizes-first-set-of-cyber-standards-for-contractors/
September 1, 2021 | International, Aerospace