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Amendment to block Avondale payoff fails

2nd June 2011   ·   0 Comments

By Zoe Sullivan
The Louisiana Weekly Contributing Writer

Rep. Cedric Richmond introduced two amendments last week to the National Defense Authorization Act, which funds the budget for the Defense Department. Both of these amendments aimed to restrict Huntington Ingalls Industries, the current owner of Avondale Shipyard, access to federal funds as reimbursement for closing the shipyard.

According to its 2010 annual report, Avondale’s previous owner, North­rup Grumman, requested $310 million from the U.S. Navy to cover “restructuring costs” associated with shutting down the plant.

One of Richmond’s amendments made a vote on the House floor but was defeated, according to govtrack.us, by a vote of 246-177 with 19 Republicans supporting the measure. Con­gressman Steve Scalise of Louisiana’s first district voted for the amendment.

Huntington Ingalls Industries (HII) refused a request for comment on the amendments.

The $310 million reimbursement request was originally submitted last year, and it was reviewed by the Defense Contract Audit Agency, which reviews contract proposals submitted to the Department of Defense. These reviews fulfill “a purely advisory function for the contracting officer,” according to an e-mail from a Department of Defense representative responding to an inquiry by The Louisiana Weekly. The email also stated that: “Our review found significant amounts of questioned and unsupported costs and we concluded that the proposal should not be used to negotiate allowable restructuring and related shutdown costs. This information was conveyed to the responsible Navy contracting officer.”

In Northrup Grumman’s annual report, this review was acknowledged, and the firm described its intention of revising its proposal for re-submission.

The Louisiana Weekly contacted the U.S. Navy contracting officer familiar with the case, but she was unable to respond in time for publication.

On the floor of the House, Rich­mond pushed his fellow Mem­bers to support the amendment.

“They [Huntington Ingalls Indus­tries] have decided that they are going to close. They made $45 million in the first quarter of this year. They announced that they are not going to bid on ships; they are not going to do anything; they are not going to stay open. Why would we give them $310 million of taxpayers’ dollars and then pretend that we’re fiscally responsible? It’s not fiscally responsible.”

HII, said Richmond, was “quitting on the American people.”

This story originally published in the May 30, 2011 print edition of The Louisiana Weekly newspaper.

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