Report: Pratt & Whitney charged multiple prices for same F-119 engine parts

Pratt & Whitney

New Haven, Conn. (WTNH) — The Air Force relied on East Hartford based Pratt & Whitney to determine costs of spare parts in a 4 year, $1.6 billion contract.

That is the findings in an Inspector General report released in February 2014, made public under the Freedom of Information Act to News8 months later.

Between 2008 and 2012, Pratt and Whitney built the F119 engine to be used in the F-22 Raptor, a fighter jet currently being used in missions against ISIS in Syria.

In the report, the Inspector General found that contracting officers “did not know whether they received fair and reasonable prices for sole-source F119 engine spare parts, valued by Pratt and Whitney at about $317.9 million”.

Both the Air Force and Pratt & Whitney said the prices were fair.

“[Air Force Life Cycle Management] does not feel it has been overcharged for spare parts by Pratt &
Whitney,” said Air Force Spokesman Daryl Mayer in a statement to News8.

The report focuses, in part, on a Fuel Pump Actuator, which the Air Force paid six different prices for between March 2008 and April 2012, according to the report. The specific cost information is redacted.

This is not the first time the Inspector General has found these issues in military contracts. In five reports dating back to 1998, News8 uncovered similar issues in Connecticut contractors and those around the country.

In April, Sikorsky repaid the Department of Justice $3.5 million for inflated costs of spare parts on Black Hawk helicopters. The Inspector General estimated they overcharged the military $11.8 million.

According to military researcher and author Dr. Jeffrey Bradford, wavering prices in military contracts are nothing new.

“You’re going to seek the best possible price, because there may not be another manned aircraft program for 20 years,” said Bradford. “When you put that profit motive in that affects industry, you can see things blurring.”

Things are changing however across the military, however, according to Connecticut Congressman Joe Courtney.

“The entire system at the [Department of Defense] needs to be reformed,” said Democratic Congressman Joe Courtney. “They have been operating with budgets that have not been auditable.”

The contract with Pratt & Whitney is an example of a “cost plus” contract, where the military pays extra to ensure contractors make a profit.
Courtney, who sits on the Armed Services Committee says the federal government is focusing more on fixed-price contracts, a process by which the price is set and the company finds ways to operate under budget.

“That just changes the whole incentive so that you’re having aircraft, ships and submarine delivered at lower costs, than it was in the old days when it was cost, plus open checkbook,” said Courtney.

Pratt & Whitney declined our request for an on camera interview. They did provide the following statement:

In March 2013, the DoD initiated audits of several performance-based logistics (PBL) contracts with industry, including Pratt & Whitney’s F119 Sustainment Program for the Raptor Engine (SPaRE) contract with the U.S. Air Force (USAF). As a part of this audit, the government sought unit pricing data for a sample of Pratt & Whitney parts, including parts provided by suppliers. Pratt & Whitney is fully compliant with the terms and conditions of the SPaRE contract, and we believe we have provided a sustainment solution at a fair and reasonable price to the USAF. Pratt & Whitney justified the price of F119 engine spare parts and provided all contractually required cost and pricing data We are committed to delivering affordable readiness to our customers and will continue to work with the USAF to ensure the F-22 Raptor can deploy at any moment, as evidenced by the recent combat deployment of the F-22 to strike ISIS targets in Syria.

Pratt & Whitney also points to an award delivered by the Under Secretary of Defense that was received for their work on the F119 engine. According to a memo provided by the Pratt & Whitney spokesman, the F-22 was given the award for reducing cost per flight hour and its mission capable rate of 71 percent, a record-high.

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