Army to pay $500M for Future Combat Systems termination

It’s been nearly three years since former Defense Secretary Robert Gates ordered the cancelation of the Army’s ambitious Future Combat Systems program, but the hits keep coming. The latest: The Defense Department may end up paying nearly half a billion dollars in termination fees for the comprehensive effort once considered to be the heart of the Army’s future force.

Those fees come as the option of cutting high-cost programs has become popular amid drastic budget cuts; it would come in addition to approximately $19 billion the Army invested in the program before it was shut down, according to the Washington Post.

The fees are to end agreements with FCS’ prime contractors, which were awarded to Boeing and SAIC in 2000. Now, termination negotiations are still ongoing and could go through July 2013.

DOD officials have cited poor contract structure and planning as critical problems for the doomed program, which comprised a number of different air, ground, manned and unmanned vehicles and systems linked by a complex network. Before its cancelation, FCS’ costs had ballooned to an estimated $200 billion.

Cancellation of the program’s vehicle component will likely cost around $164 million, the Post reported.

In November 2011, Frank Kendall, then DOD acting undersecretary for acquisition, called FCS “irrevocably damaged” by “poor systems engineering.”

“It was the fundamental design of the thing that was flawed and in my view that did not reflect what had been learned,” Gates told Defense News in June 2011.

DOD has salvaged some parts of FCS – including a ground combat vehicle, incremental brigade modernization and a tactical network – spinning them off into separate programs altered to fit a changing defense landscape. But with funding a scarcity, that future remains uncertain as well.

“Key questions remain on whether the Army will continue development or terminate other efforts from Future Combat Systems… [and] on whether the Army has yet clearly defined its internal roles and responsibilities for management of its tactical network, and how it will proceed with development of fundamental parts of the network--the advanced radios and waveforms,” the Government Accountability Office noted in a March 2011 report.

About the Author

Amber Corrin is a former staff writer for FCW and Defense Systems.

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Reader comments

Mon, Sep 30, 2013

I was in the FCS program and WASTED is the appropriate term. It was a colossal waste of money, resources, manpower, and a detriment to morale for those in the testing programs. But, look at the map and compare the congressional districts represented - they are spread all over the country. Commanders within the program would reference such maps and declare the program untouchable. The arrogance that created and administered the program was the downfall. And just to put things into perspective, the money actually spent on the program, about 20 billion (GAO projected the total program if completed, would be around 300 billion) would employ 100,000 service members for about two years, if not more. If the program had been allowed to continue, it would have equaled the amount of money to take over 100,000 service members from inception to retirement at 20+ years. So, while bickering about sequestration goes forward, and the purging of roughly 100,000 service members takes place, just remember the abhorrent mismanagement by Army brass is not only responsible for the need of a 'budget crisis' but they are personally responsible for denying 100,000 service members of 2 years of employment, health care, housing, and the same for their families. Then ask yourself if anyone in the brass will face any punishment or threat to his or her career as a result. The answer, of course, is that they won't.

Tue, Jun 5, 2012 COL Mustard Inside the Beltway

We didn't "invest" $19B in FCS; we wasted it. The system was too big, too complex and too sophisticated for Congress to understand and it didn't fundamentally change the way we fight.

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