WASHINGTON — The Air Force did not consider all its options before pursing a lease of 100 refueling planes from Boeing Co., according to a Congressional Research Service report released Wednesday.
Use of alternative funding methods could lower upfront costs, relieving one of the Air Force’s chief concerns, according to the report, requested by Sen. John McCain, R-Ariz., who has waged a two-year campaign against the deal.
The Air Force has acknowledged that leasing the refueling planes is more expensive than buying them outright, but it says that is the only way to receive them quickly. A purchase of the planes would require billions of dollars more upfront, forcing the Air Force to cut back on other programs, officials said.
But the Congressional Research Service, a nonpartisan arm of the Library of Congress, said that by using a special funding method known as incremental funding, the cost of buying the planes could be stretched out over several years. Under traditional procurement, the Air Force would be required to pay the entire cost of the planes upfront. Traditional procurement would require $11.1 billion during the first five years, but using an incremental method would lower that to $8.5 billion, according to the report.
Incremental funding is unusual and would require congressional approval, but is not unprecedented, the report said. It "represents a potential way to procure (rather than lease) the 767s while … delivering the 767s to the Air Force on the same schedule as the lease," the report said.
The Air Force is awaiting approval by the Senate Armed Services Committee before moving forward with the deal. The committee delayed a vote last month saying it wanted the Air Force to consider scaling back its proposal and lease up to 25 planes and purchase the rest. Last week, the Air Force said the proposal is "potentially unexecutable" and would delay the delivery of the planes.
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