Deep cuts, cancellation of Future Combat Systems on the table

As the Pentagon's internal budget negotiations begin to wind down, the future looks bleak for the Army's Future Combat Systems, the service's ambitious $160 billion modernization effort that is widely expected to become a casualty of the FY10 budget.

Defense Secretary Gates is weighing everything from dramatically scaling back FCS ground vehicles to canceling the program, according to several sources closely tracking the budget negotiations. He has said he will withhold making any final decisions until the end of the internal budget process.

Senior Army officials are fighting to save the program -- the most expensive and far-reaching technological endeavor in the service's history -- from the kinds of large-scale cuts that would force the service to rewrite its modernization plans.

But whatever the outcome of the budget negotiations, FCS appears likely to emerge a drastically different program than the one envisioned by the Army -- a system of unmanned aircraft, eight manned ground vehicles, unmanned vehicles and sensors linked by an intricate wireless network.

One of the proposals under review recommends killing most of the program, saving only some components and perhaps portions of the network, sources said.

Scrapping the program, which has been in development since 2000, would save billions of dollars in FY10, but it would force the Army back to the drawing board on its modernization plans, for which FCS forms the technological backbone.

It would amount to another big blow to the Army, which has seen two major programs canceled in the last seven years. In 2002, the Pentagon nixed the Crusader artillery program over the Army's objections. Two years later, the Army canceled the Comanche reconnaissance and attack helicopter after $8 billion and two decades of development.

Several sources said they view canceling FCS as a radical option and added that they expected the Defense Department to opt to reduce the scope of the program.

Another proposal circulating at the Pentagon would limit the number of ground vehicles to one or two -- with the infantry carrier vehicle and the command-and-control vehicle considered the most likely contenders to survive the budget drill, sources said.

That would mean killing off at least six other FCS vehicles, including the Non-Line-of-Sight Cannon, which has long been championed by Sen. James Inhofe, R-Okla., a senior member of the Senate Armed Services Committee whose state is home to Fort Sill, the Army's artillery center. BAE Systems, which is slated to build the cannon, announced in 2007 that it would produce the vehicle in Elgin, Okla.

Inhofe succeeded several years ago in fencing off the funding for the NLOS-C into a separate budget line from the rest of the FCS program - a move that he had hoped would save the vehicle from any significant across-the-board cuts to FCS.

The cannon, considered a follow-on to the now-defunct Crusader artillery program, has been at the forefront of the Army's FCS plans. It is the first FCS vehicle scheduled to enter production and, as such, has long been considered safe from budget cuts.

For its part, the Army had hoped to field at least four of the FCS vehicles -- the infantry and command-and-control vehicles, plus the NLOS-C and a reconnaissance vehicle -- on time or even ahead of schedule, sources have said.

But that option, although still considered a possibility, has drawn concerns from Pentagon officials that it does not yield enough cost savings.

Gates canceled plans to attend the NATO 60th anniversary summit in France this weekend so he could stay in Washington and wrap up work on the budget. He has said he will have the last word on any decisions before sending the Pentagon's request to OMB.

The budget details are not expected on Capitol Hill until late April or May, but Gates could announce some major program decisions -- possibly including the fate of FCS -- as early as next week, sources said.

Pentagon spokesman Geoff Morrell said Monday the budget is "still being built" and Gates has not set a date to reveal his decisions.