{ "id": "RL32056", "type": "CRS Report", "typeId": "REPORTS", "number": "RL32056", "active": false, "source": "EveryCRSReport.com, University of North Texas Libraries Government Documents Department", "versions": [ { "source": "EveryCRSReport.com", "id": 101711, "date": "2003-09-02", "retrieved": "2016-04-08T14:38:55.394544", "title": "The Air Force KC-767 Tanker Lease Proposal: Key Issues For Congress", "summary": "The Air Force wishes to replace its KC-135E aircraft by leasing 100 new Boeing KC-767\ntankers. \n The Air Force indicates that leasing is preferred because it will result in faster deliveries than\noutright purchasing. Air Force leaders argue that a lease will allow them to husband scarce\nprocurement dollars by making a small down payment. Although Congress authorized the proposed\nlease in the FY2002 DOD Appropriations Act, it stipulated that the defense oversight committees\nmust approve the lease -- only the Senate Armed Services Committee has yet to approve. The lease\nproposal has been controversial and issues raised thus far include:\n Whether there is an urgent need to replace the KC-135 fleet. The Air Force\nstates that replacing\nthe KC-135 is urgent, citing high costs, aircraft vulnerability to catastrophic problems, and the\nimminent closing of the 767 production line. Opponents of the lease state that operating costs are\ncontrollable and will be far lower than the overall costs of leasing the 767; that the vulnerability is\nno more than depicted in a two-year old study which the Air Force found acceptable; and that the\n767 production line is viable until 2006-2008.\n \n Whether the KC-767 is the right airplane. If acquired, the KC-767 may be\nin DOD's inventory\nfor 50 years. The Air Force says that the KC-767 is much more capable than the KC-135. \nOpponents say that other aircraft are even better than the KC-767 in meeting the Air Force's\nrequirements. The Air Force opposes re-engining KC-135Es, but opponents say it merits attention,\nas does outsourcing aerial refueling.\n Whether the Air Force cost comparison is authoritative. The Air Force's\nreport to Congress\ncalculates that a 767 lease would cost $150 million more than a purchase on a net present value\nbasis. This calculation, however, is sensitive to many assumptions. CRS analysis shows that several\nassumptions built into the calculation, if treated differently than in the Air Force report, could change\nthe calculation by hundreds of millions of dollars each. Although some could change the calculation\nto favor either the lease or the purchase, others -- such as the discount rate used to calculate net\npresent value and whether to use multi-year procurement for the purchase option -- could be more\nlikely to alter the comparison more in favor of the purchase option.\n Whether this lease has implications for congressional budget oversight. The\nproposed lease\nappears to be an unprecedented method of funding a major new defense procurement. Critics point\nout that this approach is coupled with exemptions from longstanding laws on budgeting and defense\nprocurement. The proposed lease raises policy issues regarding the visibility of full costs for DoD\nprograms in the congressional oversight process, including questions concerning locking in\nbudgetary resources when costs are uncertain, appropriateness of using an operating lease for this\nproposal, the impact of a Special Purpose Entity, and the potential for deviation from full-funding\nof the government's contractual liability. \n This report will not be updated.", "type": "CRS Report", "typeId": "REPORTS", "active": false, "formats": [ { "format": "HTML", "encoding": "utf-8", "url": "http://www.crs.gov/Reports/RL32056", "sha1": "a1ba30fa1f0394481fd9e2fc0c55b46c9cac2ec0", "filename": "files/20030902_RL32056_a1ba30fa1f0394481fd9e2fc0c55b46c9cac2ec0.html", "images": null }, { "format": "PDF", "encoding": null, "url": "http://www.crs.gov/Reports/pdf/RL32056", "sha1": "fbd649ae8f2f03770f157e9caf0d9c17d5ba05d8", "filename": "files/20030902_RL32056_fbd649ae8f2f03770f157e9caf0d9c17d5ba05d8.pdf", "images": null } ], "topics": [] }, { "source": "University of North Texas Libraries Government Documents Department", "sourceLink": "https://digital.library.unt.edu/ark:/67531/metacrs5695/", "id": "RL32056 2003-08-29", "date": "2003-08-29", "retrieved": "2005-06-12T17:57:43", "title": "The Air Force KC-767 Tanker Lease Proposal: Key Issues for Congress", "summary": "The Air Force is proposing to replace 133 of its oldest Boeing KC-135E aerial refueling tanker aircraft by leasing 100 new Boeing KC-767 tankers instead of initially buying them outright. The proposed lease was authorized by Section 8159 of the FY2002 DOD Appropriations Act (P.L. 107-117 of January 10, 2002). The main issue for Congress is whether to approve or disapprove the lease. This report examines the lease proposal and its ramifications by providing background information on the Air Force\u2019s tanker fleet, the Boeing 767 tanker, and the proposed lease itself. Then the report analyzes potential oversight issues for Congress relating to the merits of the proposed lease:", "type": "CRS Report", "typeId": "REPORT", "active": false, "formats": [ { "format": "PDF", "filename": "files/20030829_RL32056_b7465ee4d3d7d80093e7ff1293fec18a51b5a017.pdf" }, { "format": "HTML", "filename": "files/20030829_RL32056_b7465ee4d3d7d80093e7ff1293fec18a51b5a017.html" } ], "topics": [ { "source": "LIV", "id": "Weapons systems", "name": "Weapons systems" }, { "source": "LIV", "id": "Tanker aircraft - Air force procurement", "name": "Tanker aircraft - Air force procurement" }, { "source": "LIV", "id": "Public contracts", "name": "Public contracts" } ] } ], "topics": [ "Appropriations", "Economic Policy", "Foreign Affairs", "National Defense" ] }