STUDY LOOKS AT POSITIVE AFFECTS OF INVASIVE SPECIES ON THE ENDANGERED

FROM:  NATIONAL SCIENCE FOUNDATION 

Eradicating invasive species sometimes threatens endangered ones

Study of California Clapper Rail and salt marsh cordgrass Spartina offers new insights

What should resource managers do when the eradication of an invasive species threatens an endangered one?

In results of a study published this week in the journal Science, researchers at the University of California, Davis, examine one such conundrum now taking place in San Francisco Bay.

The study was led by UC Davis researcher Adam Lampert.

"This work advances a framework for cost-effective management solutions to the conflict between removing invasive species and conserving biodiversity," said Alan Tessier, acting deputy division director in the National Science Foundation's (NSF) Directorate for Biological Sciences, which supported the research through NSF's Dynamics of Coupled Natural and Human Systems (CNH) Program.

CNH is also co-funded by NSF's Directorates for Geosciences and Social, Behavioral & Economic Sciences.

"The project exemplifies the goals of the CNH program," says Tessier, "which are to advance the understanding of complex systems involving humans and nature."

The California Clapper Rail--a bird found only in San Francisco Bay--depends on an invasive salt marsh cordgrass, hybrid Spartina, as nesting habitat.

Its native habitat has slowly vanished over recent decades, largely due to urban development and invasion by Spartina.

Study results show that, rather than moving as fast as possible with eradication and restoration plans, the best approach is to slow down the eradication of the invasive species until restoration or natural recovery of the system provides appropriate habitat for the endangered species.

"Just thinking from a single-species standpoint doesn't work," said paper co-author and UC-Davis environmental scientist Alan Hastings.

"The whole management system needs to take longer, and you need to have much more flexibility in the timing of budget expenditures over a longer time-frame."

The scientists combined biological and economic data on Spartina and on the Clapper Rail to develop a modeling framework to balance conflicting management goals, including endangered species recovery and invasive species restoration, given fiscal limitations.

While more threatened and endangered species are becoming dependent on invasive species for habitat and food, examples of the study's specific conflict are relatively rare--for now.

Another case where the eradication of an invasive species threatened to compromise the recovery of an endangered plant or animal is in the southwestern United States, where an effort to eradicate Tamarisk was cancelled because the invasive tree provides nesting habitat for the endangered Southwestern Willow Flycatcher.

"As eradication programs increase in number, we expect this will be a more common conflict in the future," said paper co-author and UC Davis scientist Ted Grosholz.

Other co-authors include scientists James Sanchirico of UC Davis and Sunny Jardine of the University of Delaware.

-NSF-

Media Contacts
Cheryl Dybas, NSF

DEFENSE SECRETARY HAGEL TRAVELS TO SINGAPORE FOR MEETINGS WITH LEADERS

FROM:  U.S. DEFENSE DEPARTMENT 

U.S. Defense Secretary Chuck Hagel meets with Singaporean Prime Minister Lee Hsien Loong at the Parliament House in Singapore, May 30, 2014. DOD photo by U.S. Marine Corps Sgt. Aaron Hostutler.

Hagel Meets With Singapore’s Prime Minister, Defense Minister

American Forces Press Service

WASHINGTON, May 30, 2014 – Defense Secretary Chuck Hagel met today with top Singaporean leaders to discuss recent events in the Asia-Pacific region and the defense relationship between the United States and Singapore.
Hagel is in Singapore to attend the annual Asia security conference known as the Shangri-La Dialogue.

The secretary thanked Prime Minister Lee Hsien Loong for Singapore's continued leadership in the region, particularly with respect to the Association of Southeast Asian Nations, Pentagon Press Secretary Navy Rear Adm. John Kirby said in a statement. “He also thanked the prime minister for Singapore's role in hosting the annual Shangri-La Dialogue, underscoring the growing importance of such meetings as the region continues to face shared challenges,” he added.

The two leaders discussed recent events in the South and East China seas and reiterated the need for any disputes to be resolved in a peaceful manner consistent with international law that respects the principle of freedom of navigation, Kirby said, and Hagel discussed the continued and deep U.S. commitment to the region’s security and prosperity.

Hagel also met privately with Singaporean Defense Minister Dr. Ng Eng Hen.
“Secretary Hagel thanked Minister Ng for his strong support of the relationship our two militaries continue to enjoy,” Kirby said. “They also discussed a range of regional security issues, to include tensions in the South and East China seas, recent events in Thailand, defense reforms in Japan, and the need for a continued focus on dialogue, cooperation and the peaceful resolution of disputes in the region.”

Hagel reiterated the U.S. commitment to its security obligations in the Asia-Pacific region, the press secretary added, and stressed the importance of multilateral venues like the Shangri-La Dialogue to helping all Pacific nations work more closely together in improving mutual understanding, transparency and cooperation.

U.S. DEFENSE DEPARTMENT CONTRACTS FOR MAY 30, 2014

FROM:  U.S. DEFENSE DEPARTMENT DEFENSE 

CONTRACTS

ARMY
Exelis Systems Corp., Colorado Springs, Colorado, was awarded a $143,100,534 modification (P00012) to contract W91RUS-13-C-0006 for operations and maintenance support of Title X communications equipment and information systems under the Network Enterprise Technology Command (Army), 160th Signal Brigade and its subordinate units in southwest Asia. Fiscal 2014 operations and maintenance (Army) funds in the amount of $143,100,534 were obligated at the time of the award. Work will be performed in Kuwait, Afghanistan and Bahrain, with an estimated completion date of May 31, 2015. Army Contracting Command, Ft. Huachuca, Arizona, is the contracting activity.

Camber Corp., Huntsville, Alabama, was awarded a $49,000,000 firm-fixed-price contract for incident response systems contractor logistics support for the Marine Corps in support of the Chemical, Biological, Radiological, and Nuclear team. Funding and work location will be determined with each order. The estimated completion date is May 29, 2017. Bids were solicited via the Internet with four received. Army Contracting Command, Natick, Massachusetts, is the contracting activity (W911QY-14-D-0022).

ESA South, Inc.,* Cantonment, Florida, was awarded a $45,000,000 firm-fixed-price contract for emergency temporary roof repairs to residential structures in support of the U.S. Army Corps of Engineers and the Federal Emergency Management Agency disaster response. Work will be performed in Alabama, Connecticut, Delaware, Florida, Georgia, Louisiana, Maine, Maryland and Washington, District of Columbia. Work will also be done in Massachusetts, Mississippi, New Hampshire, New Jersey, New York, North Carolina, Pennsylvania, Rhode Island, South Carolina, Texas and Virginia, with an estimated completion date of May 31, 2019. Bids were solicited via the Internet with nine received. Funding will be determined with each order. U.S. Army Corps of Engineers, Omaha, Nebraska, is the contracting activity (W9128F-14-D-0014).
Northrop Grumman Systems Corp., ISR&T Div., Boulder, Colorado, was awarded a $37,974,775 cost-plus-fixed-fee contract for logistics support and engineering services to the Joint Tactical Ground Station (JTAGS) system Block 1 fielded units as well as associated exerciser and institutional training suites. Work will be performed in Colorado Springs, Colorado, with an estimated completion date of July 31, 2018. Bids were solicited via the Internet with one received. Fiscal 2014 other procurement funds in the amount of $37,092, and operations and maintenance funds in the amount of $3,266,544 are being obligated at the time of the award. U.S. Army Space and Missile Defense Command, Huntsville, Alabama, is the contracting activity (W9113M-14-C-0018).

Great Lakes Dredge & Dock Co., Oak Brook, Illinois, was awarded a $25,376,872 firm-fixed-price contract for dredging the main channel of the Delaware River. Work will be performed in Philadelphia, Pennsylvania, with an estimated completion date of March 31, 2015. Bids were solicited via the Internet with three received. Fiscal 2014 operations and maintenance (Army) funds in the amount of $12,000,000, and fiscal 2014 other procurement funds in the amount of $13,376,872 are being obligated at the time of the award. U.S. Army Corps of Engineers, Philadelphia, Pennsylvania, is the contracting activity (W912BU-14-C-0013).
Peckham Vocational Industries, Inc., Lansing, Michigan, was awarded an $18,905,472 modification (P00013) to contract W56HZV-12-D-0064 to incorporate the first option year into the base contract for services to the Organizational Clothing and Individual Equipment (OCIE) Central Management Office to establish a national repair system to evaluate, clean and repair unserviceable, but economically repairable OCIE. Funding and work location will be determined with each order. Estimated completion date is May 31, 2015. Army Contracting Command, Warren, Michigan, is the contracting activity.

SRA International, Fairfax, Virginia, was awarded a $17,802,501 firm-fixed-price contract for enterprise operations and security services, and information technology services, for the Army National Guard. Work will be performed in Arlington, Virginia, with an estimated completion date of May 31, 2015. One bid was solicited and one received. Fiscal 2014 operations and maintenance (Army) funds in the amount of $17,802,501 are being obligated at the time of the award. National Guard Bureau, Arlington, Virginia, is the contracting activity (W9133L-14-C-0031).

General Dynamics Ordnance and Tactical Systems, Inc., St. Petersburg, Florida, was awarded a $12,743,632 modification (P00020) to contract W52P1J-11-C-0027 to add to the existing contract: explosive cartridges (100,000); explosive d 5" – (10,521); explosive d dye filled (5,163); improved conventional munitions (34,436); medium caliber – (1,116,122); and fuses (999,940). Fiscal 2014 other procurement (Army) funds in the amount of $12,743,632 were obligated at the time of the award. Estimated completion date is May 27, 2015. Work will be performed in St. Petersburg. Army Contracting Command, Rock Island Arsenal, Illinois, is the contracting activity.

HGL Construction, Inc.*, Oklahoma City, Oklahoma, was awarded a $10,000,000 firm-fixed-price contract with options for military and civil works construction within the U.S. Army Corps of Engineers Southwestern Division. The estimated completion date is May 29, 2015. Funding and work location will be determined with each order. Bids were solicited via the Internet with 22 received. U.S. Army Corps of Engineers, Tulsa, Oklahoma, is the contracting activity (W912BV-14-D-0006).

Mythics Inc., Virginia Beach, Virginia, was awarded an $11,041,269 modification (KX02) to contract W91QUZ-06-A-0003 to act under license from Oracle to provide Program Manager Warfighter Information Network-Tactical software maintenance/support. Fiscal 2014 other procurement (Army) funds in the amount of $11,041,269 were obligated at the time of the award. Estimated completion date is May 29, 2018. Work will be performed in Virginia Beach. Army Contracting Command, Aberdeen, Maryland, is the contracting activity.
Colt Defense LLC, West Hartford, Connecticut, was awarded a $6,750,000 firm-fixed-price contract for breech bolt assemblies for the M16 rifle and M4 carbine. Funding and work location will be determined with each order. Bids were solicited via the Internet with five received. Army Contracting Command, Warren, Michigan, is the contracting activity (W56HZV-14-D-0046).

AIR FORCE

Al Raha Group for Technical Services, Riyadh, Saudi Arabia, has been awarded an estimated $93,335,656 undefinitized contract action for repair & return services for Royal Saudi Air Force F-15 unclassified items. Work will be performed at Riyadh; Warner Robins, Georgia and multiple certified sources of repair located throughout the continental United States. The work is expected to be completed by May 31, 2015. This contract is 100 percent foreign military sales for Saudi Arabia. This award is the result of a sole-source acquisition. Air Force Life Cycle Management Center/WWQK, Robins Air Force Base, Georgia, is the contracting activity (FA8505-14-C-0003).

Lockheed Martin Space Systems Center, Sunnyvale, California, has been awarded a $41,206,525 modification (P00075) to FA8810-08-C-0002 for the Highly Elliptical Orbit (HEO) Transition to Operations. The total cumulative face value of the contract is $3,214,926,620. The contract modification is to add HEO-4 launch and early on-orbit test (LEOT) capabilities to the HEO-3 LEOT baseline. This HEO 3/4 transition concept of operations is required to support the HEO 3/4 payloads transition to the Increment 2 operational baseline. Work will be performed at Sunnyvale and Azusa, California; Boulder, Aurora, and Colorado Springs, Colorado, and is expected to be completed by Sept. 30, 2018. Fiscal 2013 research and development funds in the amount of $36,528,691 are being obligated at time of award. Space and Missile Systems Center, Los Angeles, California, is the contracting activity.

Northrop Grumman Aerospace Systems, San Diego, California, has been awarded a $13,039,369 modification (P00512) to F33657-01-C-4600 for the Enhanced Integrated Sensor Suite (EISS) Timing and Control (TAC) Module A-3 replacement effort. The total cumulative face value of the contract is $2,318,001,044. The contract modification is for the completion of flight tests necessary to ensure the EISS TAC module and associated software developments are compatible to the Global Hawk aircraft in form, fit and function. Work will be performed at San Diego, and is expected to be completed by June 30, 2015. Fiscal 2013 research and development funds in the amount of $13,039,369 are being obligated at time of award. Air Force Life Cycle Management Center/WIGK, Wright-Patterson Air Force Base, Ohio, is the contracting activity.

E-Corp, Layton, Utah (FA9401-14-D-0001); Mac Electric, Inc., Yuma, Arizona (FA9401-14-D-0002); Mirador Enterprises, Inc., El Paso, Texas (FA9401-14-D-0003); Applied Construction Technologies, LLC, Albuquerque, New Mexico (FA9401-14-D-0004); Engineering Construction Services LLC, Las Cruces, New Mexico (FA9401-14-D-0005); Dawn Inc. and McTech Corp. Joint Venture, Warren, Ohio (FA9401-14-D-0006), have been awarded a $12,800,000 firm-fixed-price, multiple-award indefinite-delivery/indefinite-quantity contract for design/build and construction requirements (except military construction). This work will consist of multiple disciplines in general construction categories in a broad range of maintenance, repair, minor and/or new construction. Work will be performed at Kirtland Air Force Base, New Mexico, and other sites supported by Kirtland; the work is expected to be completed by May 27, 2019. This award is a result of a competitive 8(a) set-aside acquisition posted on the Federal Business Opportunities Website; 19 offers were received. Fiscal 2014 operations and maintenance funds will be obligated with each task order. Air Force Nuclear Weapons Center/PZIC, Kirtland Air Force Base, New Mexico, is the contracting activity.

NAVY

Earl Industries L.L.C. doing business as NASSCO-Mayport, Jacksonville, Florida, is being awarded a not-to-exceed $23,238,392 undefinitized contract action for continuous maintenance availability to include structural damage and aluminum welding onboard USS Hue City (CG 66). This effort on USS Hue City covers repairs to the superstructure including the main propulsion gas turbine intake. Work will encompass four levels and will require extensive aluminum welding. Other work to be performed involves electrical equipment and cable replacement, lagging and insulation, exhaust vent ducting, vane axial fans, deck drain piping, watertight doors and metal joiner doors. Work will be performed in Jacksonville, and is expected to be completed by November 2014. Fiscal 2014 operations and maintenance (Navy) contract funds in the amount of $8,372,146 will be obligated at time of award. Funding in the amount of $8,372,146 will expire at the end of the current fiscal year. This contract was not competitively procured in accordance with 10 U.S.C. 2304(c)(3). Southeast Regional Maintenance Center, Mayport, Florida, is the contracting activity (N40027-14-C-0015).

Walbridge Aldinger Co., Detroit, Michigan, is being awarded $21,550,080 for firm-fixed-price task order 0005 under a previously awarded multiple award construction contract (N40085-10-D-5331) for construction of a CH-53K helicopter maintenance training facility and Regional Communication Station (RCS) at Marine Corps Air Station New River, North Carolina. The CH-53K facility will provide a training space to support maintenance personnel and will house several full size CH-53K mock-ups. The facility will also provide classrooms, administration space, personnel support space, general offices, hydraulic/mechanical rooms, tool room, maintenance training areas, storage space, avionics, airframe, wire repair, and composite repair labs, a high bay, clear span hangar area and an access apron for CH-53K preventive maintenance training. The RCS facility will provide administrative spaces, customer service area, reception, secure vault, electronic repair space, conference room, training room/classroom, battery storage room, mechanical spaces, personnel support space, and telephone switchgear space. The task order also contains four planned modifications, which if exercised would increase cumulative task order value to $23,392,433. Work will be performed in Jacksonville, North Carolina, and is expected to be completed by December 2015. Fiscal 2014 military construction (Navy) contract funds in the amount of $21,550,080 are being obligated on this award and will not expire at the end of the current fiscal year. Four proposals were received for this task order. The Naval Facilities Engineering Command, Mid-Atlantic, Norfolk, Virginia, is the contracting activity.

Northrop Grumman Systems Corp., Bethpage, New York, is being awarded a $20,917,239 modification under previously awarded contract (N00024-06-C-6311) to provide integration services for mission packages that will deploy from and integrate with the Littoral Combat Ship (LCS). The Navy’s plan is to use continuous evaluation of system maturity through a disciplined system engineering framework to improve mission capability in identified mission areas. LCS mission packages will be optimized for flexibility in the littorals. Work will be performed in Bethpage, New York (44 percent); Oxnard, California (16 percent);
Washington, District of Columbia (14 percent); Panama City, Florida (10 percent); Dahlgren, Virginia (8 percent); San Diego, California (4 percent); Hollywood, Maryland (2 percent); Andover, Massachusetts (1 percent); and Middletown, Rhode Island (1 percent), and is expected to be completed by January 2015. Fiscal 2014 and 2015 operations and maintenance (Navy); fiscal 2014 and 2015 research, development, test and evaluation; and fiscal 2015 other procurement (Navy) funding in the amount of $20,917,239 will be obligated at time of award. Contract funds in the amount of $5,611,140 will expire at the end of the current fiscal year. The Naval Sea Systems Command, Washington, District of Columbia, is the contracting activity.

Softchoice Corp., McLean, Virginia, is being awarded $17,487,675 for delivery order 0030 against a previously awarded Blanket Purchase Agreement (M67854-12-A-4701). This delivery order will procure Microsoft brand name software licenses and support, known as software assurance. Work will be performed in McLean, and is expected to be completed by May 2015. Fiscal year 2014 operation and maintenance (Marine Corps) funds in the amount $17,487,675 will be obligated at the time of award and will expire at the end of the current fiscal year. The Marine Corps System Command, Quantico, Virginia, is the contracting activity.

Softchoice Corp., McLean, Virginia, is being awarded $15,703,370 for delivery order 0031 against a previously awarded Blanket Purchase Agreement (M67854-12-A-4701). This delivery order will procure Microsoft brand name software licenses and support, known as software assurance. Work will be performed in McLean, and work is expected to be completed in May 2015. Fiscal 2014 operation and maintenance (Marine Corps) funds in the amount $12,007,670, and fiscal 2014 operation and maintenance (Marine Corps Reserves) funds in the amount of $3,695,700, will be obligated at the time of award. Contract funds will expire at the end of the current fiscal year. The Marine Corps System Command, Quantico, Virginia, is the contracting activity.

CH2M Hill Constructors, Inc., Englewood, Colorado, is being awarded a $15,044,771 modification to task order JU01 under a previously awarded indefinite-delivery/indefinite-quantity multiple award contract (N62470-13-D-6019), to exercise option one which provides for furniture, fixtures and equipment for the Naval Sea Systems Command Headquarters Recovery Restoration at Naval Support Activity Washington. The work to be performed provides for labor, management, supervision, tools, materials, site work and provisions necessary to provide for furniture, fixtures and equipment. The total contract amount after exercise of this option will be $59,284,771. Work will be performed in Washington, District of Columbia, and is expected to be completed by February 2015. Fiscal 2014 operation and maintenance (Navy) contract funds in the amount of $15,044,771 are being obligated on this award and will expire at the end of the current fiscal year. The Naval Facilities Engineering Command, Washington, Washington, District of Columbia, is the contracting activity.

Timken Gears & Services Inc., King of Prussia, Pennsylvania, is being awarded a $13,963,212 modification to previously awarded contract (N00024-10-C-2310) to procure a DDG 51 class main reduction gear assembly. The main reduction gear is the set of gears that transmit the power from two main propulsion power turbines to the propulsion shaft. Each DDG 51 class destroyer has two gear sets, one for each propulsion shaft. Work will be performed in Santa Fe Springs, California (68 percent); Riverside, Missouri (10 percent); New Castle, Delaware (7 percent); Latrobe, Pennsylvania (2 percent); St. Augustine, Florida (1 percent); Spring Grove, Illinois (1 percent); Fitchburg, Massachusetts (1 percent); Corry, Pennsylvania (1 percent); Erie, Pennsylvania (1 percent); Antigo, Wisconsin (1 percent); and other United States locations less than 1 percent (7 percent). Work is expected to be completed by May 2016. Fiscal 2014 other procurement (Navy) contract funds in the amount of $13,963,212 will be obligated at time of award and will not expire at the end of the current fiscal year. The Naval Sea Systems Command, Washington, District of Columbia, is the contracting activity.
Leebcor Services, LLC*, Williamsburg, Virginia, is being awarded $13,799,474 for firm-fixed-price task order 0002 under a previously awarded multiple award construction contract (N69450-13-D-1765) for the construction of the Littoral Combat Ship (LCS) Logistics Support Facility at Naval Station Mayport. The work to be performed provides for the construction of a two-story building with a reinforced concrete foundation, masonry walls and a pitched standing seam metal roof logistics support facility to serve the LCS Squadron and other organizations which support the LCS. The project also includes construction of classrooms, operations watch work space, a reference library room, storage, administrative office space, video teleconference rooms, and crew lounge. The task order also contains one unexercised option, which if exercised, would increase cumulative task order value to $16,011,693. Work will be performed in Jacksonville, Florida, and is expected to be completed by November 2015. Fiscal 2014 military construction (Navy) contract funds in the amount of $13,799,474 are being obligated on this award and will not expire at the end of the current fiscal year. Five proposals were received for this task order. The Naval Facilities Engineering Command, Southeast, Jacksonville, Florida, is the contracting activity.

Colonna’s Shipyard, Inc.*, Norfolk, Virginia, is being awarded a $13,262,660 firm-fixed price contract, for docking phased maintenance availability to include drydocking, hull plating replacement, propulsion engine removal and habitability onboard USS Zephyr (PC 8). This contract includes options which, if exercised, would bring the cumulative value of this contract to $14,280,669. Work will be performed in Norfolk, and is expected to be completed July 2015. Fiscal 2014 operations and maintenance (Navy) funding in the amount of $14,280,669 will be obligated at time of award. Contract funds will expire at the end of the current fiscal year. This contract was competitively procured via the Federal Business Opportunities website, with nine proposals solicited and two offers received. Southeast Regional Maintenance Center, Mayport, Florida, is the contracting activity (N40027-14-C-0010).

Stemnion, Inc.,* Pittsburgh, Pennsylvania, is being awarded a $9,894,778 cost-reimbursement (no fee) contract modification to previously awarded contract (N62645-13-C-4014) to exercise an option to provide research and development services in support the Naval Medical Research Center’s cellular combat wound initiative. Work will be performed in Pittsburgh, , and the work is expected to be completed April 2016. Fiscal 2013 research, development, test and evaluation (Navy) funds in the amount of $9,894,778 will be obligated at the time of award; the funds will not expire at the end of the current fiscal year. The Naval Medical Logistics Command, Fort Detrick, Maryland, is the contracting activity.

BAE Systems, Land & Armaments L.P., Minneapolis, Minnesota, is being awarded a $7,137,528 cost-plus-fixed-fee contract for the MK 45 5” gun system design agent services and waterfront/pierside support. BAE Systems will provide engineering, technical, logistics services and technical data to support the MK 45 5” gun system design, development, fabrication, production, operation and integration. This contract includes options which, if exercised, would bring the cumulative value of this contract to $44,417,249. Work will be performed in Minneapolis, Minnesota (85 percent) and Louisville, Kentucky (15 percent); and is expected to be completed by May 2015. Fiscal 2011 shipbuilding and conversion (Navy); fiscal 2014 operations and maintenance (Navy); and fiscal 2013 and 2014 weapons procurement (Navy) funding in the amount of $7,137,528 will be obligated at the time of the award. Contract funds in the amount of $1,087,528 will expire at the end of the current fiscal year. This contract was not competitively procured in accordance with 10 U.S.C 2304(c)(1) and FAR 6.302-1 - only one responsible source and no other supplies or services will satisfy the agency's requirements. The Naval Sea Systems Command, Washington, District of Columbus, is the contracting activity (N00024-14-C-5324).

DEFENSE LOGISTICS AGENCY

Phillips 66 Company, Bartlesville, Oklahoma, has been awarded a maximum $9,407,144 fixed-price with economic-price-adjustment contract for fuel and delivery service to Altus Air Force Base, Oklahoma. This delivery order was a competitive acquisition on a five-year basic ordering agreement (SP0600-13-R-0706) with one offer received. Location of performance is Oklahoma with an Aug. 31, 2014 performance completion date. Using military service is Air Force. Type of appropriation is fiscal 2014 defense working capital funds. The contracting activity is the Defense Logistics Agency Energy, Fort Belvoir, Virginia (SP0600-14-G-0611-0001).

Meggitt (Rockmart), Inc., Rockmart, Georgia, has been awarded a maximum $7,600,327 firm-fixed-price contract for aircraft fuel cells. This contract was a competitive acquisition, with one offer received. This is a three-year base contract. Location of performance is Georgia with a May 15, 2017 performance completion date. Using military services are Air Force and Defense Logistics Agency Aviation. Type of appropriation is fiscal 2014 Air Force working capital funds. The contracting activity is the Defense Logistics Agency Aviation, Tinker Air Force Base, Oklahoma (SPRTA1-14-C-0023).

Phillips 66 Company, Bartlesville, Oklahoma, has been awarded a maximum $7,218,029 fixed-price with economic-price-adjustment contract for fuel and delivery service to Tinker Air Force Base, Oklahoma. This delivery order was a competitive acquisition on a five-year basic ordering agreement (SP0600-13-R-0706) with one offer received. Location of performance is Oklahoma with an Aug. 31, 2014 performance completion date. Using military service is Air Force. Type of appropriation is fiscal 2014 defense working capital funds. The contracting activity is the Defense Logistics Agency Energy, Fort Belvoir, Virginia (SP0600-14-G-0611-0005).

DEFENSE INFORMATION SYSTEMS AGENCY

Verizon Business Network Services, Inc., Ashburn, Virginia was awarded a $10,567,483 firm-fixed-price contract for the Priority Telecommunication Service to support the Department of Homeland Security Office of Emergency Communications. This contract has a nine-month base period and nine one-year option periods. If all options are exercised, the total cumulative contract value is $81,027,515. Work will be performed throughout the continental United States, with an estimated completion date of March 31, 2015. Fiscal Year 2014 operation and maintenance funds in the amount of $10,567,483 are being obligated at award. The contract was a sole-source award pursuant to 10 U.S.C. 2304(c)(1). The Defense Information Technology Contracting Organization, Scott Air Force Base, Illinois is the contracting activity (HC1013-14-C-0002).

U.S. TRANSPORTATION COMMAND

Erickson Transport, Inc. (formerly Evergreen Helicopters of Alaska), Portland, Oregon, has been awarded a $17,662,214 modification (P00018) to previously awarded contract HTC711-10-D-R017; Berry Aviation, Inc.* of San Marcos, Texas, has been awarded a $32,907,631 modification (P00024) to previously awarded HTC711-10-D-R018; and AAR Airlift Group, Inc. of Palm Bay, Florida, has been awarded a $42,519,795 modification (P00019) to previously awarded HTC711-10-D-R016 for fixed-wing aircraft, personnel, equipment, tools, material, maintenance and supervision necessary to perform passenger and cargo air transportation service. Work will be performed in Afghanistan with an expected completion date of May 31, 2015. Fiscal year 2014 operations and maintenance funds are being obligated at time of award: full amount for Erickson Transport, Inc., and Berry Aviation, Inc., and $15,123,535 for AAR Airlift Group, Inc. The U.S. Transportation Command Directorate of Acquisition, Scott Air Force Base, Illinois, is the contracting activity.

DEFENSE INTELLIGENCE AGENCY

Zel Technologies, LLC of Hampton, Virginia, is being awarded a maximum $25,000,000 indefinite-delivery/indefinite-quantity contract providing specialized services in science and engineering, business operation functions and other related services in support of the Defense Intelligence Agency’s science and technology mission. Work will be performed in the United States with an estimated completion date of May 31, 2019. The acquisition was a set aside competition for small businesses, with three offers received. Fiscal 2014 operations and maintenance funds in the amount of $1,360,720 and fiscal 2014 research, development, test and evaluation funds in the amount of $710,828 are being obligated on the first task order. Virginia Contracting Activity, Washington, District of Columbia is the contracting activity (HHM402-14-D-0006).

*Small Business

U.S. CONGRATULATES PEOPLE OF SAMOA ON THEIR INDEPENDENCE DAY

FROM:  U.S. STATE DEPARTMENT 

Samoa's Independence Day

Press Statement

John Kerry

Secretary of State

Washington, DC

May 30, 2014

---

On behalf of President Obama and the people of the United States, I would like to congratulate the people of the Independent State of Samoa as you celebrate the 52^nd anniversary of your nation’s independence this June 1.

The United States and Samoa enjoy a warm friendship, strengthened by our cooperation in advancing our shared values and interests. We are working together to protect the environment and oceans, promote sustainable economic development, strengthen democratic institutions, combat the effects of climate change, and reinforce the rule of law in the Pacific region.
The United States looks forward to further deepening our partnership with Samoa.

We wish all Samoans around the world a joyous celebration and peace and prosperity over the coming year.

U.S. SECRETARY OF VETERANS AFFAIRS RESIGNS

FROM:  THE DEFENSE DEPARTMENT 

Accepts Shinseki’s Resignation as VA Secretary

American Forces Press Service

WASHINGTON, May 30, 2014 – President Barack Obama said today that “with considerable regret” he has accepted the resignation of Eric K. Shinseki as secretary of veterans affairs.

Sloan Gibson, who has served as deputy VA secretary for the last three months, will head the department in an acting capacity until a permanent successor takes office.

“Ric Shinseki has served his country with honor for nearly 50 years,” the president said. “He did two tours of combat in Vietnam -- he’s a veteran who left a part of himself on the battlefield. He rose to command the 1st Cavalry Division, served as Army chief of staff, and has never been afraid to speak truth to power.”
As VA secretary, Obama said, Shinseki presided over record investments in the nation’s veterans -- enrolling 2 million new veterans in health care, delivering disability pay to more Vietnam veterans exposed to Agent Orange, making it easier for veterans with post-traumatic stress, mental health issues and traumatic brain injury to get treatment and improving care for women veterans.
At the same time, he added, Shinseki helped to reduce veteran homelessness and assisted more than 1 million veterans, service members and their families pursue their education under the Post-9/11 GI Bill.

“So Ric’s commitment to our veterans is unquestioned,” Obama said. “His service to our country is exemplary. I am grateful for his service, as are many veterans across the country. He has worked hard to investigate and identify the problems with access to care, but as he told me this morning, the VA needs new leadership to address them.”

Shinseki’s resignation comes as revelations unfold of practices at VA medical facilities that have masked delays in veterans receiving health care with prescribed time limits. “He does not want to be a distraction, because his priority is to fix the problem and make sure our vets are getting the care that they need,” Obama said. “That was Ric’s judgment on behalf of his fellow veterans, and I agree. We don't have time for distractions. We need to fix the problem.”

Gibson, now the acting VA secretary, has devoted his life to serving the nation and its veterans, the president said. “His grandfather fought on the front lines of World War I,” he added. “His father was a tail-gunner in World War II. Sloan graduated from West Point, earned his Airborne and Ranger qualifications, and served in the infantry. And most recently, he was President and CEO of the USO, which does a remarkable job supporting our men and women at war, their families, our wounded warriors and families of the fallen.”

The president said he told Gibson that reforms in getting veterans the health care they deserve cannot wait.

“We’re going to do right by our veterans across the board, as long as it takes,” he said. “We're not going to stop working to make sure that they get the care, the benefits, and the opportunities that they’ve earned and they deserve. I said we wouldn’t tolerate misconduct, and we will not. I said that we have to do better, and we will. There are too many veterans receiving care right now who deserve all of our best efforts -- and an honest assessment if something is not working.”
Obama noted that he has visited recently with men and women in uniform at different stages of their service, including the newest Army officers at their U.S. Military Academy graduation, troops currently serving in Afghanistan, and veterans and military families at Arlington National Cemetery on Memorial Day.
“And what I saw is what I’ve seen in every single service member, veteran, and military spouse that I have had the privilege to meet -- a selfless, clear-eyed commitment to serving their country the best way that they know how,” he said. “They’re the best that our country has to offer. They do their duty. They expect us to do ours.

“So, today,” he continued, “I want every man and woman who’s served under our flag to know -- whether your tour has been over for decades, or it’s just about to end -- we will never stop working to do right by you and your families.”

DOD SAYS DEFENSE SECRETARY'S ASIA CONFERENCE "STRENGTHEN MILITARY-TO-MILITARY RELATIONSHIPS"

FROM:  U.S. DEFENSE DEPARTMENT 

Hagel: Meetings in Singapore Will Build on Relationships

By John D. Banusiewicz

American Forces Press Service

WASHINGTON, May 30, 2014 – At an annual Asia security conference in Singapore that he helped to create while he was a U.S. senator, Defense Secretary Chuck Hagel will lay out challenges the participating nations face and will meet with many fellow defense leaders to strengthen their military-to-military relationships with the United States.

Speaking with reporters traveling with him to the Shangri-La Dialogue, Hagel noted that this is his fifth trip to the Asia-Pacific region since he took office in February 2013, and that President Barack Obama and Secretary of State John F. Kerry have visited the region in recent months.

“So we continue to build on the relationships that are part of showing our commitment, and the visits are part of showing our commitment to this Asia-Pacific rebalance,” he said.

Hagel said that in a speech at the conference, he will talk about some specific challenges, Thailand being one, as well as the China-U.S. relationship and tensions in the South and East China seas.

“I will address in my remarks these challenges, he added, “as well as continuing to focus on the building of these mutual defense capability relationships as we deepen and strengthen our partners' capabilities in this area.”

During the conference, the secretary said, he will have one-on-one meetings with his counterparts from 10 nations, as well as two trilateral meetings. One trilateral meeting, with Japan and South Korea, will be particularly important, he added.
“I am looking forward to each of these bilaterals, because in the bilateral meetings, you can go deeper and wider into the specifics of the differences,” Hagel said. “And I'm looking forward to the meeting I will have with my Chinese counterpart.” When he visited Beijing in April, Hagel said he addressed the specifics of the differences that the United States and China have. “And the only way to deal with those differences is to be direct and upfront,” he added.
Two weeks ago, the secretary noted in emphasizing the ongoing U.S. military relationship with China, Chairman of the Joint Chiefs of Staff Army Gen. Martin E. Dempsey -- who also is in Singapore to attend the Shangri-La Dialogue -- hosted the senior Chinese military leader at the Pentagon.

“It's clearly in both China and the U.S. interest to continue to build that relationship,” Hagel said, “if for no other reason than assure both sides as best we can and the nations of Asia-Pacific that we have some sense of each other's intentions, we have some ability to communicate when tensions rise, we have mechanisms [and] bridges to deal with those before they get beyond our ability to deal with them.

So we'll continue to focus on that,” he continued. “But also, when we talk about Asia-Pacific and what the Shangri-La Dialogue is all about, this is an area of the world that is growing; it's prospering. It's an area that's presenting more and more opportunities for more and more people, but also more and more challenges.”
Among those challenges, the secretary said, is the critical importance of open, free sea lanes and airways for commerce.

“The nations of this region, Asia-Pacific, rely on those freedoms -- individual rights. So, we'll talk about that,” he said. “We'll talk about tensions and what's going on in some specific terms. But at the same time, we still have to develop relationships of cooperation, and we do have areas that we cooperate, as well as directly confronting not just areas of competition, but where we think China is overplaying its hand and is presenting new challenges and new tensions to this area.”

BIDEN GIVES SPEECH AT U.S. AIR FORCE ACADEMY 2014 GRADUATION

FROM:  U.S. AIR FORCE 

The U.S. Air Force Academy's Class of 2014 marches into Falcon Stadium for graduation in Colorado Springs, Colo., May 28, 2014. A total of 995 cadets received their commissions during the ceremony. U.S. Air Force photo by Bill Evans.

The U.S. Air Force Thunderbirds fly overhead as graduating cadets toss their covers skyward as commencement concludes at the U.S. Air Force Academy in Colorado Springs, Colo. May 28, 2014. U.S. Air Force photo by Mike Kaplan.

DEPUTY AG COLE'S SPEECH ON PRISON RAPE ELIMINATION ACT

FROM:  U.S. JUSTICE DEPARTMENT 

Deputy Attorney General James Cole Speaks at Press Conference Updating States’ Efforts to Comply with Prison Rape Elimination Act

Washington, D.C. ~ Wednesday, May 28, 2014

Hello everyone.  Thank you for joining us this afternoon to discuss the Prison Rape Elimination Act (PREA) and the work being done across the country to implement the National PREA Standards.

I’m joined by Mary Lou Leary, the Principal Deputy Assistant Attorney General of the Department’s Office of Justice Programs.  She and I will both make brief statements, and then we will take a few questions from you.

Let me start with some background on PREA.  PREA was passed, unanimously, by Congress and signed into law by then-President Bush in 2003.  PREA required, among other things, the development and promulgation of “national standards for the detection, prevention, reduction and punishment of prison rape.”  These standards, like the law mandating them, are intended to address a serious public safety, public health and human rights problem – the incidence of sexual violence in our nation’s confinement facilities.

According to our most recent research, an estimated 4 percent of state and federal prison inmates and 3.2 percent of jail inmates reported experiencing one or more incidents of sexual victimization by another inmate or a facility staff member within the previous 12 months.  Even more troubling, an estimated 9.5 percent of adjudicated youth in state juvenile facilities and state contract facilities reported sexual victimization in the previous 12 months.

These statistics are alarming and they are unacceptable.  No one should be subjected to sexual abuse while in the custody of our justice system.  It serves as a violation of fundamental rights, an attack on human dignity and runs contrary to everything we stand for as a nation.

To stem the tide, back in 2009, a bipartisan national commission submitted draft PREA standards to the Department of Justice.  We opened those standards to two rounds of public comment that generated more than 2,000 comments from members of the public and stakeholder groups – including justice system policymakers and practitioners, corrections professionals, and victim and inmate advocates.  In addition, the commission and the department held several public hearings to get feedback from corrections professionals and other constituent groups.  After incorporating many of the comments and input from the hearing, we issued the final standards in 2012.

The states and territories have since begun auditing their facilities for compliance with the standards, and the governors have been asked to submit certifications of compliance or assurances that they are working toward compliance.

This May 15th served as the deadline for state governors to indicate to the Department of Justice that their states and territories fully comply with the National PREA Standards or, in the alternative, that they will use a portion of certain department grant funds to work to achieve full compliance with the standards in the future.

The deadline for those certifications and assurances recently passed.  I’ll let Mary Lou discuss the responses in more detail, but I do wish to say that we were very encouraged.  Forty-six states and territories provided assurances that they will leverage a portion of grant funding to work toward achieving compliance.  Two states – New Hampshire and New Jersey – certified that they are in full compliance.  It’s clear that states and territories are taking this issue seriously and that addressing sexual abuse in confinement facilities is a high nationwide priority.

We know that there are real challenges associated with compliance.  In that regard, the department is fully committed to working closely with the states and territories to help them meet their PREA responsibilities.

For instance, we’ve put into place a number of resources to aid corrections directors and staff, jail administrators, sheriffs, those who oversee and work in juvenile facilities and others.  Since 2010, we’ve made almost 100 awards totaling over $22 million to support state and local jurisdictions in creating zero-tolerance cultures for sexual abuse in confinement facilities.  And we established the PREA Resource Center to provide training and intensive technical assistance to justice system actors and victim advocates on a broad range of issues related to PREA.

While we are encouraged by the responses from the states and territories working actively toward compliance, I must be clear that the jurisdictions that do not comply with the standards – of which there are eight – will be held accountable, as we are required to do by law.

We will continue to work to provide all jurisdictions with the assistance they need to come into compliance.  We expect that the commitment to ending sexual violence in our nation’s confinement facilities – voiced by so many of our nation’s governors – will be reflected not by their words alone, but in the action they take.

The enactment of PREA 11 years ago signaled an unequivocal rejection of the outdated – and morally unconscionable – acceptance of rape as part of the sentence being served by an adult or juvenile in the American correctional system.  The PREA standards have lead us closer to ending the culture of violence in our nation’s prisons, jails, and juvenile facilities.  Going forward, we will continue to help the states and territories work to ensure that their correctional facilities are safe and live up to the standards we’ve set.

I’d now like to let Principal Deputy Assistant Attorney General Mary Lou Leary provide you with details about what OJP has learned from the governors, and OJP’s next steps to assist with compliance.

SECRETARY KERRY, ESTONIAN PRIME MINISTER PAET MAKE REMARKS BEFORE MEETING

FROM:  U.S. STATE DEPARTMENT S

Remarks With Estonian Foreign Minister Urmas Paet Before Their Meeting

Remarks

John Kerry

Secretary of State

Treaty Room

Washington, DC

May 29, 2014

SECRETARY KERRY: Good morning, everybody. Great pleasure to welcome Foreign Minister Paet of Estonia to Washington. We could not be more grateful or pleased for and with the relationship with Estonia.

Estonia is a very strong NATO partner. In fact, one of only four countries in NATO that has met its 2 percent commitment to defense, and has committed to continue that 2 percent spending for at least the next 10 years. We have a very strong relationship with respect to democracy, commitment to democracy building, territorial integrity. Estonia has been a solid partner in the effort to make clear all of our feelings about the territorial violations that have taken place with respect to Ukraine and the challenge to stability in the region.

In addition to that, Estonia is currently hosting a significant increase of presence within NATO in order to make clear the issues of sovereignty within the region. So on the issues of defense and security we have been as forward leaning as any members within the NATO alliance. But in addition to that, we have other efforts in which we’re working together, particularly diversity of the energy supply to Europe. There are important choices to be made in order to try to create greater energy independence. Estonia is a leader with respect to that effort, as well as our hopes, all of us, to try to move forward on the Transatlantic Trade and Investment Partnership, which we think is a critical economic step that can rekindle growth in Europe and strengthen the rules of the road for our economies.

So we have a lot to talk about today, but particularly grateful to welcome a country that has been, frankly, as courageous, as clear, as principled as Estonia has been. It’s a strong and important NATO ally, and we’re happy to have the discussions we will today.

Thank you.

FOREIGN MINISTER PAET: Thank you. Well, it’s good to be in Washington once again, and thank you very much for hosting, Secretary Kerry. Estonia and the United States, we are very strong partners and we share all important and basic values. And Estonia really and strongly appreciates the very quick reaction of the United States to change the security circumstances and security environment in Europe. We appreciate a lot the additional contribution of the United States with air policing of Estonia and also Latvia and Lithuania, and also troops you sent to Estonia to participate in military exercise, but also to stay longer in Estonia.

Of course, we both at the moment like to see the quick and clear de-escalation of the situation in Ukraine. Unfortunately, recently, another four OSCE observers were taken by people in eastern Ukraine. Among these four OSCE observers also one is an Estonian citizen, and we of course hope that these people will be released as soon as possible.

We’re also making good cooperation with the United States in this fare of supporting new democracies, which together in the so-called LEND project, which supports the leaders of new democracies and also one of the areas we make very strong cooperation is cyber defense and all other cyber and IT-related issues.

I’d like also mention energy security of Europe, and here the United States plays important and critical role, and the EU and U.S. relationship is also for us absolute necessity, so that we are also firm and strong supporter of European Union and United States free trade agreement talks, so that we hope that this common free trade area will be created as soon as possible.

So that once again, thank you very much for hosting. Thank you very much for this very strong partnership and friendship. Thank you.

SECRETARY KERRY: Thank you very much.

QUESTION: Mr. Secretary, Edward Snowden says he has cooperated with Russia…

SECRETARY KERRY: I have no comment right now, but thank you.

PUERTO RICO JUDGE, BUSINESSMAN INDICTED IN CONSPIRACY AND BRIBERY CASE

FROM:  U.S. JUSTICE DEPARTMENT 

Thursday, May 29, 2014

Puerto Rico Superior Court Judge and Local Businessman Indicted on Conspiracy and Federal Programs Bribery Charges

A current Puerto Rico Superior Court Judge and Puerto Rico businessman were charged with orchestrating a criminal scheme in which the businessman paid bribes to the judge presiding over the criminal case against the businessman according to an indictment unsealed today.

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Rosa Emilia Rodríguez-Vélez of the District of Puerto Rico, and Special Agent in Charge Carlos Cases of the FBI’s San Juan Division made the announcement.

“The outcome of a criminal case should be determined by the evidence and the law, not by paid-for bias,” said Assistant Attorney General Caldwell.  “When citizens can’t have faith in the very people who are sworn to uphold the law, confidence in the entire system is shaken.  We are committed to restoring that faith by rooting out corruption wherever it may be found.”

“A fair and impartial criminal justice system is one of the cornerstones of our democracy,” said U.S. Attorney Rodríguez-Vélez.  “Judges, in particular, are expected to protect the public’s trust in the fairness of the judicial system.  Investigations such as the one leading to today’s indictment are crucial to deter corrupt officials influenced by greed from breaking their oath to uphold the rule of law.   This case should serve as a strong warning to those who might consider similar behavior.  No one is above the law and everyone is accountable for their misdeeds.”

“Rogue justice as the one allegedly imparted by Judge Manuel Acevedo-Hernández will not be tolerated by the FBI,” said Special Agent in Charge Cases.   “The FBI will continue vigorously to investigate allegations of corruption at all levels.”

The indictment, returned yesterday by a federal grand jury in the District of Puerto Rico and unsealed today, charges Manuel Acevedo-Hernandez, 62, and Lutgardo Acevedo-Lopez, 39, with conspiracy to commit federal programs bribery.  Acevedo-Hernandez was also charged with receipt of a bribe by an agent of an organization receiving federal funds, and Acevedo-Lopez was charged with paying a bribe to an agent of an organization receiving federal funds.

According to the indictment, Acevedo-Hernandez, a Supervisory Superior Court Judge in the Aguadilla judicial region of Puerto Rico, allegedly accepted bribes from Acevedo-Lopez and others, knowing that the payments were made so that Acevedo-Hernandez would use his official position as a Superior Court judge for Acevedo-Lopez’s benefit.    In particular, Acevedo-Hernandez presided over a criminal trial of Acevedo-Lopez and acquitted Acevedo-Lopez of all charges pending against him, including vehicular homicide.   In exchange for the acquittal, Acevedo-Lopez, through an intermediary, bribed Acevedo-Hernandez by paying taxes owed by Acevedo-Hernandez, paying for construction of a garage, and providing him with a motorcycle, clothing and accessories, including cufflinks and a watch.

The charges contained in the indictment are merely accusations.   The defendants are presumed innocent unless and until proven guilty.

The case is being investigated by the FBI’s San Juan Division and is being prosecuted by Trial Attorney Peter Mason of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorneys Timothy Henwood and Jose Capo of the District of Puerto Rico.

U.S. DEFENSE DEPARTMENT CONTRACTORS FOR MAY 29, 2014

FROM:  U.S. DEFENSE DEPARTMENT 

CONTRACTS

AIR FORCE

Textron Defense Systems, Wilmington, Massachusetts, has been awarded a $190,065,670 firm-fixed-price contract for 361 sensor fuzed weapons, seven trainers and 18 wind corrected munitions dispenser tail kits. Work will be performed at Wilmington, and is expected to be completed by Dec. 31, 2016. This contract involves foreign military sales to the Republic of Korea. Air Force Life Cycle Management Center/OO-ALC/EBHKA, Hill Air Force Base, Utah, is the contracting activity (FA8213-14-C-0017).

ARMY

AAI Corp, Hunt Valley, Maryland, was awarded a $75,010,510 cost-plus-fixed fee contract to support the Army Aviation and Missile Research, Development and Engineering Center, Software Engineering Directorate's Joint System Integration Laboratory for technology integration into the contractor's fleet of unmanned aircraft systems, including the Shadow, and associated ground support equipment to allow the demonstration of enhanced or improved UAS platform, payload, and ground systems performance. The estimated completion date is May 29, 2018. Funding and work location will be determined with each order. One bid was solicited and one received. Army Contracting Command, Redstone Arsenal, Alabama is the contracting activity (W31P4Q-14-D-0020).

L-3 Communications Corp., Arlington, Texas, was awarded a $48,978,323 firm-fixed-price, foreign military sales (Saudi Arabia) contract for the acquisition of three UH-60L operational flight trainers for the Royal Saudi Land Forces. Work will be performed in Arlington, Texas, with an estimated completion date of May 25, 2018. One bid was solicited and one received. Fiscal 2014 other procurement funds in the amount of $48,978,323 are being obligated at the time of the award. Army Program Executive Office Simulation, Training & Instrumentation, Orlando, Florida, is the contracting activity (W900KK-14-C-0001).

Bethel/ERRG JV,* Bethel, Alaska (W911KB-14-D-0018); EA Engineering, Science & Technology Inc.,* Hunt Valley, Maryland (W911KB-14-D-0019); and Environmental Compliance Consultants,* Anchorage, Alaska (W911KB-14-D-0020) were awarded a $30,000,000 firm-fixed-price, indefinite
delivery/indefinite-quantity, multiple award contract for environmental quality services at various locations primarily within Alaska. Funding and work location will be determined with each order with an estimated completion date of May 28, 2019. Bids were solicited via the Internet with 17 received. U.S. Army Corps of Engineers, Elmendorf AFB, Alaska, is contracting activity.

Sikorsky Aircraft Corp., Stratford, Connecticut, was awarded a $24,000,000 modification (P00163) to contract W58RGZ-12-C-0008 to realign the funding between the fiscal 2014 advance procurement funds and the planned aircraft production funds for fiscal 2015, with no change to the UH-60 or HH-60 contract price. Fiscal 2014 other procurement funds in the amount of $24,000,000 were obligated at the time of the award. Work will be performed in Stratford, with an estimated completion date of Dec. 31, 2015. Army Contracting Command, Redstone Arsenal, Alabama, is the contracting activity.

JAM-MAP JV,* San Antonio, Texas, was awarded a $9,420,746 firm-fixed-price contract for the construction of unmanned aerial systems site work, utilities, and entry control point at Fort Hood, Texas, with an estimated completion date of May 28, 2016. Option one will be exercised at the time of award. Bids were solicited via the Internet with six received. Fiscal 2014 military construction funds in the amount of $9,420,746 are being obligated at the time of the award. U.S. Army Corps of Engineers, Fort Worth, Texas, is the contracting activity (W9126G-14-C-0016).

Pacchiosi Drill USA, Inc. New York, New York, was awarded a $9,232,436 firm-fixed-price contract for American River Common Features, Sites R7 and L7, to construct cutoff walls using the jet grout method along the waterside slope of the levee in Sacramento, California with an estimated completion date of March 9, 2015. Bids were solicited via the Internet with two received. Fiscal 2014 other procurement funds in the amount of $9,232,436 are being obligated at the time of the award. U.S. Army Corps of Engineers, Sacramento, California is the contracting activity (W91238-14-C-0041).

American Rheinmetall Munitions Inc., Stafford, Virginia, was awarded a $6,797,433 firm-fixed-price contract for 34,762 grenades (66mm, smoke screening infra-red vehicle-launched) and first article test. Work will be performed in Germany with an estimated completion date of May 27, 2020. Bids were solicited via the Internet with one received. Fiscal 2013 other procurement funds in the amount of $5,235,716, and fiscal 2014 other procurement funds in the amount of $1,561,716, are being obligated at the time of the award. Army Contracting Command, Rock Island Arsenal, Illinois is the contracting activity (W52P1J-14-C-0042).

NAVY

L-3 Communications Vertex Aerospace LLC, Madison, Mississippi, is being awarded a $55,410,943 modification to a previously awarded indefinite-delivery requirements contract (N00019-13-D-0007) to exercise an option for logistics services support of the TH-57 aircraft fleet. Services to be provided include all logistics services and materials for organizational and depot level services to support and maintain the aircraft. Work will be performed at Naval Air Station Whiting Field, Milton, Florida, and is expected to be completed in May 2015. No funds are being obligated at the time of award. Funds will be obligated against individual delivery orders as they are issued. The Naval Air Systems Command, Patuxent River, Maryland, is the contracting activity.

Softchoice Corp., McLean, Virginia, is being awarded $42,557,745 for firm-fixed-price delivery order NS09 under a previously awarded single Blanket Purchase Agreement (M67854-12-A-4701) to procure Microsoft brand name software support, known as software assurance.

Work will be performed in McLean, and is expected to be completed by May 2015. Fiscal 2014 operations and maintenance (Navy) funding in the amount of $42,557,745 will be obligated at the time of award, and funds will expire at the end of the current fiscal year. This delivery order is issued against a single award BPA, which was competitively awarded. The contracting activity is the Space and Naval Warfare System Command, San Diego, California it will award the delivery order on behalf of its organizational partner, Program Executive Office for Enterprise Information Systems.

Raytheon Integrated Defense Systems, Largo, Florida, is being awarded an $11,014,015 modification to previously awarded contract (N00024-12-C-5231) to exercise an option for five AN/USG-3B Cooperative Engagement Capability (CEC) Airborne Systems. CEC is a sensor netting system that significantly improves battle force anti-air warfare capability by extracting and distributing sensor-derived information such that the superset of this data is available to all participating CEC units. CEC improves battle force effectiveness by improving overall situational awareness and by enabling longer range, cooperative, multiple, or layered engagement strategies. Work will be performed in St. Petersburg, Florida (90 percent), Largo, Florida (10 percent), and is expected to be completed by November 2015. Fiscal 2014 aircraft procurement (Navy) funding in the amount of $11,014,015 will be obligated at time of award. Contract funds will not expire at the end of the current fiscal year. The Naval Sea Systems Command, Washington, District of Columbia, is the contracting activity.

Sechan Electronics Inc.*, Lititz, Pennsylvania, is being awarded an $8,734,680 firm-fixed-price delivery order under previously awarded contract (N00024-12-D-5203) for production of Signal Data Processor – Sierra (SDP-S) assemblies in support of the Cooperative Engagement Capabilities (CEC) program. The SDP-S assemblies provide an open architecture assembly to the CEC systems using commercial-off-the-shelf components. The SDP-S provides the core of the CEC system providing processing capability. The SDP-S assemblies are used on CEC shipboard, airborne and land mobile platforms to provide a composite network picture. CEC is a sensor netting system that significantly improves battle force Anti-Air Warfare capability by extracting and distributing sensor-derived information such that the superset of this data is available to all participating CEC units. CEC improves battle force effectiveness by improving overall situational awareness and by enabling longer range, cooperative, multiple, or layered engagement strategies. Work will be performed in Lititz, and is expected to be completed by June 2015. Fiscal 2013 and 2014 other procurement (Navy); fiscal 2012 procurement (Marine Corps); fiscal 2013 and 2014 aircraft procurement (Navy); fiscal 2013 and 2014 shipbuilding and conversion (Navy); and fiscal 2014 research, development, test & evaluation contract funds in the amount of $8,734,680 will be obligated at time of award. Contract funds in the amount of $1,164,624 will expire at the end of the current fiscal year. The Naval Sea Systems Command, Washington, District of Columbia, is the contracting activity.

DEFENSE LOGISTICS AGENCY

Science Application International Corporation, Fairfield, New Jersey, has been awarded a maximum $15,800,000 fixed-price, indefinite-delivery/indefinite-quantity, prime vendor bridge contract for maintenance, repair and operations for the Hawaii region. This contract was a sole-source acquisition. Location of performance is New Jersey, with a Sept. 15, 2014 performance completion date. Using military services are Army, Navy, Air Force, Marine Corps and federal civilian agencies. Type of appropriation is fiscal 2014 defense working capital funds. The contracting activity is the Defense Logistics Agency Troop Support, Philadelphia, Pennsylvania (SPM500-04-D-BP06/P00037).

Essex Industries, Inc.,* St. Louis, Missouri, has been awarded a maximum $7,699,472 firm-fixed-price contract for emergency passenger oxygen system. This contract was a sole-source acquisition. This is a one-year base contract with four one-year option periods. Location of performance is Missouri with a May 22, 2015 performance completion date. Type of appropriation is fiscal 2014 defense working capital funds. The using military service and contracting activity is the Defense Logistics Agency Aviation, Richmond, Virginia (SPE4A7-14-D-0170). (Awarded May 22, 2014).

Allied Tube and Conduit Corporation, Harvey, Illinois, has been awarded a maximum $6,670,408 fixed-price with economic-price-adjustment contract for razor wire. This is a two-year base contract with three one-year option periods. Location of performance is Illinois with a May 28, 2016, performance completion date. Using military services are Army, Navy, Air Force, Marine Corps and federal civilian agencies. This contract was a competitive acquisition with three offers received. Type of appropriation is fiscal 2014 defense working capital funds. The contracting activity is the Defense Logistics Agency Troop Support, Philadelphia, Pennsylvania (SPE8E6-14-D-0006).

Cobra Systems, Inc.,* Bloomington, New York, has been awarded a maximum $6,670,408 fixed-price with economic-price-adjustment contract for razor wire. This is a two-year base contract with three one-year option periods. Location of performance is New York with a May 28, 2016, performance completion date. Using military services are Army, Navy, Air Force, Marine Corps and federal civilian agencies. This contract was a competitive acquisition with three offers received. Type of appropriation is fiscal 2014 defense working capital funds. The contracting activity is the Defense Logistics Agency Troop Support, Philadelphia, Pennsylvania (SPE8E6-14-D-0007).

Berenfield Containers, Inc.,* Mason, Ohio, has been awarded a maximum $6,500,000 fixed-price with economic-price-adjustment contract for steel shipping and storage drums. This is a two-year base contract with three one-year option periods. Location of performance is Ohio with a May 28, 2016, performance completion date. Using military services are Army, Navy, Air Force and Marine Corps. This contract was a competitive acquisition with two offers received.Type of appropriation is fiscal 2014 through fiscal 2016 defense working capital funds. The contracting activity is the Defense Logistics Agency Troop Support, Philadelphia, Pennsylvania (SPE8ED-14-D-0005).

*small business

SECRETARY KERRY'S STATEMENT ON COMMEMORATION OF INTERNATIONAL DAY OF UN PEACEKEEPERS

FROM: U.S. STATE DEPARTMENT 

Commemoration of International Day of UN Peacekeepers

Press Statement

John Kerry

Secretary of State

Washington, DC

May 29, 2014

---

We pause today in grateful recognition of the service and sacrifice of the more than 116,000 men and women serving across 16 UN peacekeeping missions in some of the most dangerous and inhospitable parts of the world.

I am especially proud of the more than 140 U.S. military and police personnel currently deployed in support of UN peacekeeping operations in the Democratic Republic of the Congo, Haiti, Liberia, Mali, South Sudan, and the Middle East. I thank them all for their service and dedication to seeing these critical missions succeed.

President Obama and I are well aware of the dangers peacekeepers face every day, and we honor the more than 3,200 men and women—including 72 Americans—who have laid down their lives in the service of peace since 1948.

UN peacekeepers embody the international community’s commitment to helping member states emerge from conflict and make progress on the road to a lasting peace.
The United States remains a committed partner in UN peacekeeping as an effective and efficient tool for addressing threats to international peace and security, including through such efforts as the Department’s Global Peace Operations Initiative, which has helped train and equip more than 260,000 peacekeepers from 69 partner countries.

MAN PLEADS GUILTY IN VOTER INTIMIDATION AND IDENTIFICATION FRAUD CASE

FROM:  U.S. JUSTICE DEPARTMENT 

Thursday, May 29, 2014

Seattle Man Pleads Guilty to Voter Intimidation and Identification Fraud for Letters Sent to Florida Residents in Conjunction with the 2012 Federal Elections

James Webb Baker Jr., 58, of Seattle, pleaded guilty today to one count of voter intimidation and one count of identification fraud in the U.S. District Court for the Middle District of Florida.  Prior to the 2012 federal elections, Baker created and sent 200 fake voter eligibility letters to Republican Party donors across Florida that questioned the recipients’ citizenship status.  During the plea hearing, Baker admitted that he intended the letters to look as if they were written by county elections officials and that his purpose in sending the letters was to intimidate the recipients and interfere with their right to vote.

According to the evidence presented in court proceedings and documents, in October 2012, Baker read about the efforts of the Florida Governor and the Florida Secretary of State to remove the names of voters from the official Florida county lists of eligible voters.  Angered by what he believed to be an attempt to suppress voter turnout, specifically of Hispanic voters who would vote for candidates of the Democratic Party, Baker created “false” or “copycat” voter eligibility letters of the actual letters sent by county officials.  Baker sent his letters, which questioned the recipient’s eligibility to vote, to 200 Republican Party donors.  The letters required the recipients to complete a voter eligibility form within 15 days or else their name would be removed from the voter registration rolls.  Baker inserted a line of text in bold stating that a nonregistered voter who casts a vote may be subject to criminal sanctions.

The letters looked almost identical to official county Supervisor of Elections letters, and included the county official’s name, letterhead, address and contact information.  During the plea proceedings, Baker admitted to making several changes to the original official letters in order to stress the threats that the recipients would lose their right to vote and/or be imprisoned if they did not first document their citizenship and right to vote in person to the registrar.

“Protecting the right to vote is one of the department’s top priorities,” said Acting Assistant Attorney General Jocelyn Samuels for the Civil Rights Division.  “The Civil Rights Division is strongly committed to comprehensive and vigorous enforcement of laws that protect the rights of every American to vote free from intimidation, coercion, or threats.”

“My office is committed to aggressively protecting the integrity of the election process,” said U.S. Attorney A. Lee Bentley III for the Middle District of Florida.  “Each citizen must be able to vote without intimidation or discrimination and to have that vote counted.  It is imperative that those who have specific information about intimidation, discrimination or election fraud make that information available immediately to my office, the FBI or the Civil Rights Division.”

“This joint investigative effort is yet another example of the fortitude and commitment  of our collective agencies to protect our citizen’s individual and constitutional rights,” said FBI Special Agent in Charge Paul Wysopal for the FBI Tampa Field Office.

“This case was complex,”  said Florida Department of Law Enforcement Commissioner Gerald Bailey.  “It required the expertise and dedication of FDLE Executive Investigations, crime lab analysts and intelligence analysts.  Their efforts led to the identification and conviction of Baker.  My thanks to each of them.”
           
“Using the U.S. Mail to threaten or intimidate voters will not be tolerated,” said  Inspector in Charge Brad Kleinknecht with the Seattle Division of the U.S. Postal Inspection Service.  “The Postal Inspection Service, along with its law enforcement partners, will continue to investigate all cases of this nature to ensure the U.S. Mail continues to play a key role our nation's election process.”

This case was investigated by the FBI, U.S. Postal Inspection Service and the Florida Department of Law Enforcement.  It is being prosecuted by Special Litigation Counsel Mark Blumburg and Trial Attorney William E. Nolan of the Civil Rights Division, and Assistant U.S. Attorney Robert A. Mosakowski of the U.S. Attorney’s Office for the Middle District of Florida.

MEDICAL CENTER TO PAY ALMOST $41 MILLION TO RESOLVE ALLEGED UNNECESSARY BILLING FOR CARDIAC PROCEDURES, KICKBACKS

FROM:  U.S. JUSTICE DEPARTMENT 

Wednesday, May 28, 2014

King’s Daughters Medical Center to Pay Nearly $41 Million to Resolve Allegations of False Billing for Unnecessary Cardiac Procedures and Kickbacks

Ashland Hospital Corp. d/b/a King’s Daughters Medical Center (KDMC) has agreed to pay $40.9 million to resolve allegations that it submitted false claims to the Medicare and Kentucky Medicaid programs for medically unnecessary coronary stents and diagnostic catheterizations and had prohibited financial relationships with physicians referring patients to the hospital, the Justice Department announced today.

Assistant Attorney General Stuart F. Delery of the Justice Department’s Civil Division, U.S. Attorney Kerry Harvey for the Eastern District of Kentucky and Special Agent in Charge Derrick L. Jackson at the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG) Kentucky region made the announcement.

“Hospitals that place their financial interests above the well-being of their patients will be held accountable,” said Assistant Attorney General Delery.   “ The Department of Justice will not tolerate those who abuse federal health care programs and put the beneficiaries of these programs at risk by providing medically unnecessary care.”

The government alleged that, between 2006 and 2011, KDMC billed for numerous unnecessary coronary stents and diagnostic catheterizations performed by KDMC physicians on Medicare and Medicaid patients who did not need them.   The government also alleged that the physicians falsified medical records in order to justify these unnecessary procedures, which allegedly generated millions of dollars in Medicare and Kentucky Medicaid reimbursements for KDMC.

“The conduct alleged in this matter is unacceptable, victimizing both taxpayers and patients,” said U.S. Attorney Harvey.   “Treatment decisions motivated by financial gain undermine public confidence in our health care system and threaten vital federal programs upon which so many of our citizens rely.   We will not relent in our efforts to protect the public from the sort of systematic misconduct alleged in this case.”

The settlement also resolves allegations that KDMC violated the Stark Law by paying certain cardiologists salaries that were unreasonably high and in excess of fair market value.   The Stark Law is designed to limit the influence of money on physicians’ medical decision-making by prohibiting financial relationships between hospitals and referring physicians, unless these relationships meet certain designated exceptions.

In connection with this settlement, KDMC has agreed to enter into a Corporate Integrity Agreement with HHS-OIG, which obligates the hospital to undertake substantial internal compliance reforms and to commit to a third-party review of its claims to federal health care programs for the next five years.

“Medically unnecessary procedures can cause serious health issues, cost the taxpayers millions of dollars each year and drain the Medicare Trust Fund,” said Special Agent in Charge Jackson.   “The OIG will continue to protect beneficiaries and hold health care providers accountable for improper claims.”

“This type of alleged conduct deceives individuals when they are seeking medical treatment and are vulnerable,” said Special Agent in Charge Perrye K. Turner of the FBI’s Louisville Field Division.  “The level of funds involved in this matter is staggering.   This money has been stolen from the patients and the taxpayers.”

The Commonwealth of Kentucky will receive approximately $1,018,380, which represents the state’s share of the recovered Medicaid funds.   The Medicaid program is funded jointly by the federal and state governments.

This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by Attorney General Eric Holder and Secretary of Health and Human Services Kathleen Sebelius.  The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation.  One of the most powerful tools in this effort is the False Claims Act.  Since January 2009, the Justice Department has recovered a total of more than $19 billion through False Claims Act cases, with more than $13.4 billion of that amount recovered in cases involving fraud against federal health care programs.

The investigation was conducted by the FBI, the HHS-OIG, the Kentucky Office of Attorney General, Medicaid Fraud and Abuse Control Unit, the Commercial Litigation Branch of the Department of Justice’s Civil Division and the U.S. Attorney’s Office for the Eastern District of Kentucky.   The claims settled by this agreement are allegations only, and there has been no determination of liability.

CHAIRMAN JOINT CHIEFS GIVE TAKE ON IRAN'S INFLUENCE

FROM:  U.S. DEFENSE DEPARTMENT 

Dempsey Discusses Iran’s Influence on Region

By Jim Garamone

American Forces Press Service

ABU DHABI, United Arab Emirates, May 28, 2014 – A diplomatic solution to the problems caused by Iran’s pursuit of nuclear weapons technology is infinitely preferable to a military operation, but the military option remains available, the chairman of the Joint Chiefs of Staff said here today.

Army Gen. Martin E. Dempsey said in an interview that the United States maintains a “credible and capable amount of military force in the region so that if the diplomatic track fails, it is available to my leaders.”

President Barack Obama has stated many times that the United States will not allow Iran to develop nuclear weapons. “If [Iran] takes the opportunity and comes to that conclusion diplomatically, everyone will be better off,” he said.
But ending Iran’s nuclear ambitions won’t solve the problem the country poses to the region, the chairman said.

“They exert malign influence in others ways, to include surrogates and proxies [such as] Lebanese Hezbollah [and] the IRGC Quds Force. They are the region’s biggest trafficker in weapons. They are very active in a malign way in cyber,” he said. “There are many things that cause me concern about Iran, both regionally and globally, that will not be solved even if the nuclear issue is solved.”

Unless they change their behavior, Dempsey said, Iranian leaders will be held accountable for other things, adding that the United States would like Iran to change its behavior and be a constructive influence in the world.

“But we’re not naive,” he said. “There’s a pretty significant distance to where we are today with Iran and where we might like to be.”

With its rich history and a culture that has influenced the world, Dempsey said, Iran can take a constructive turn. “We certainly would hope Iran would take advantage of those things and stop its malign activities,” he added.

SEC FILES ACCOUNTING FRAUD CHARGES AGAINST COMPANY FOR MANIPULATING INVENTORY ACCOUNTS

FROM:  SECURITIES AND EXCHANGE COMMISSION 

The Securities and Exchange Commission today filed accounting fraud charges against a Dallas-based company and its former chief financial officer for manipulating its inventory accounts.

The SEC alleges that I. John Benson made repeated false accounting entries that materially inflated the value of inventory on the balance sheets at DGSE Companies Inc., which buys and sells jewelry, diamonds, fine watches, rare coins, precious metals and other collectibles.  Benson’s entries made it appear that DGSE owned certain inventory that actually still belonged to customers in consignment arrangements where DGSE held the goods on the owner’s behalf until they were sold.  Benson then misled the company’s independent auditors about the journal entries, and DGSE subsequently overstated its inventory by anywhere from 99.1 percent to 227.4 percent in public filings during 2009, 2010, and 2011.

DGSE agreed to settle the SEC’s charges, and Benson agreed to a settlement in which he will pay a $75,000 penalty, be permanently barred from serving as an officer or director of a public company, and be suspended from practicing as an accountant on behalf of any publicly traded company or other entity regulated by the SEC.

“Benson’s job as CFO was to protect the integrity of DGSE’s financial statements,” said David Woodcock, chair of the SEC Enforcement Division’s Financial Reporting and Audit Task Force and director of the Fort Worth Regional Office.  “Instead he took advantage of DGSE’s weak internal control environment to intentionally manipulate its public filings.”

According to the SEC’s complaint filed in the Dallas Division of U.S. District Court for the Northern District of Texas, deficiencies in DGSE’s accounting systems and controls led to problems that significantly compromised the integrity of the company’s financial data.  The deficiencies included the failure to properly record intercompany transactions such as inventory transfers between stores.  As a result, DGSE’s intercompany accounts became out of balance by millions of dollars.

The SEC alleges that Benson subsequently made a number of fraudulent accounting entries in order to bring the intercompany accounts and DGSE’s general ledger as a whole back into balance.  The entries resulted in a number of errors in DGSE’s financial statements including the large overstatement of DGSE inventory by millions of dollars.  Benson concealed the improper entries by manipulating inventory detail listings to improperly reflect the consigned inventory as being owned by DGSE.  Benson sent these listings to DGSE’s external auditor, and misled the auditor to believe the consigned goods were owned by DGSE.  Benson then knowingly signed misleading public filings by DGSE, including annual reports for the 2009 and 2010 fiscal years as well as quarterly filings.  Benson also signed false management certifications that were attached to these filings.

Benson is charged with violating the antifraud, reporting, recordkeeping, lying-to-accountants and internal controls provisions of the federal securities laws.  DGSE is charged with reporting, recordkeeping, and internal controls failures.  DGSE and Benson each consented to injunctions against future violations of these provisions.  DGSE also agreed to the appointment of an independent consultant to review the company’s accounting controls, and DGSE has taken or agreed to take remedial steps to correct its deficiencies.

The SEC’s investigation was conducted by Chris Davis, Keith Hunter, and Joann Harris of the Fort Worth Regional Office.

FDIC REPORTS INSURED INSTITUTION FIRST QUARTER INCOME OF $37.2 BILLION, DOWN $3.1 BILLION

FROM:  U.S. FEDERAL DEPOSIT INSURANCE CORPORATION 

Commercial banks and savings institutions insured by the Federal Deposit 

Insurance Corporation (FDIC) reported aggregate net income of $37.2 billion in the first quarter of 2014, down $3.1 billion (7.6 percent) from earnings of $40.3 billion the industry reported a year earlier. The decline in earnings was mainly attributable to a $7.1 billion (10.7 percent) decline in noninterest income. Lower income from reduced mortgage activity and a drop in trading revenue contributed to a year-over-year decline in noninterest income. Additionally, noninterest income was higher one year ago due to a one-time gain at one institution. Despite the decline in earnings, more than half of the 6,730 insured institutions reporting (54 percent) had year-over-year growth in quarterly earnings. The proportion of banks that were unprofitable during the first quarter fell to 7.3 percent from 8.5 percent a year earlier.

"We saw further improvement in the condition of the banking industry in the first quarter," said FDIC Chairman Martin J. Gruenberg. "Asset quality continues to improve, loan balances are trending up, fewer institutions are unprofitable, and the number of problem banks continues to decline. However, industry revenue has been affected by narrow margins, modest loan growth, and a decline in noninterest income as higher interest rates have reduced mortgage-related activity and trading income fell."

Asset quality indicators continued to show improvement as insured banks and thrifts charged off $10.4 billion in uncollectible loans during the quarter, down $5.5 billion (34.8 percent) from a year earlier. The amount of noncurrent loans and leases (those 90 days or more past due or in nonaccrual status) fell by $12.1 billion (5.8 percent) during the quarter. The percentage of loans and leases that were noncurrent declined to 2.46 percent, the lowest level since the 2.35 percent posted at the end of third quarter 2008.

Total loan and lease balances rose by $37.8 billion (0.5 percent) in the first quarter to $7.9 trillion. Credit card balances posted a seasonal decline and banks continued to reduce their inventories of mortgage loans held for sale, but most other loan categories registered modest growth. Over the last 12 months, loan and lease balances increased by 3.6 percent, the highest 12-month growth rate since before the recent financial crisis.

Despite the overall growth in loan and lease balances, income from mortgage-related activity remained well below the level of a year earlier. Noninterest income from the sale, securitization and servicing of mortgages was $4.0 billion (53.6 percent) lower than a year ago. One- to four-family residential real estate loans originated and intended for sale were $323.6 billion (70.6 percent) lower than in the first quarter of 2013, as rising interest rates in the second quarter of 2013 reduced the demand for mortgage refinancings. Realized gains on available-for-sale securities also were lower than a year ago, as higher medium- and long-term interest rates reduced the market values of fixed-rate securities. Banks reported $827 million in pretax income from realized gains in the first quarter, a decline of $1.2 billion (60.1 percent) from the first quarter of 2013.

First quarter net operating revenue (the sum of net interest income and total noninterest income) of $163.7 billion was $6.7 billion (4.0 percent) lower than a year earlier, as a $361 million (0.3 percent) increase in net interest income was outweighed by the drop in noninterest income. The average net interest margin (the difference between the average yield banks earn on loans and other investments and the average cost of funding those investments) was 3.17 percent, the lowest since the third quarter of 1989 as declining asset yields at larger institutions outpaced the decline in the cost of funds.

Total noninterest expense was $18 million (0.02 percent) lower than in the first quarter of 2013, as payroll expenses fell by $579 million (1.2 percent). Banks set aside $7.6 billion in provisions for loan losses, a reduction of $3.3 billion (30.3 percent) compared to a year earlier. This is the 18th consecutive quarter that the industry has reported a year-over-year decline in quarterly loss provisions.

The average return on assets (ROA) fell to 1.01 percent in the first quarter from 1.12 percent a year earlier and the average return on equity (ROE) fell to 8.99 percent from 9.96 percent.

Financial results for the first quarter of 2014 are contained in the FDIC's latest Quarterly Banking Profile, which was released today. Also among the findings:

Community banks earned $4.4 billion during the quarter. The FDIC has added a new section to the Quarterly Banking Profile that reports on the performance of community banks – those institutions that provide traditional, relationship-based banking services in their local communities. Based on criteria developed for the FDIC Community Banking Study published in December 2012, there were 6,234 community banks (93 percent of all FDIC-insured institutions) in the first quarter of 2014 with assets of $2.0 trillion (14 percent of industry assets). Although net income at community banks of $4.4 billion was down $67 million (1.5 percent) from a year earlier, the percentage decline was far less than the 7.6 percent decline in earnings reported by the industry. The report also finds that loan balances at community banks grew at a faster pace than the industry, asset quality indicators continued to show improvement, and community banks accounted for 45 percent of small loans to businesses.

The number of "problem banks" fell for the 12th consecutive quarter. The number of banks on the FDIC's "Problem List" declined from 467 to 411 during the quarter. The number of "problem" banks now is less than half the post-crisis high of 888 at the end of the first quarter of 2011. Five FDIC-insured institutions failed in the first quarter.

The Deposit Insurance Fund (DIF) balance continued to increase. The DIF balance (the net worth of the Fund) rose to $48.9 billion as of March 31 from $47.2 billion at year-end 2013. Assessment income was the primary contributor to the growth in the Fund balance. Estimated insured deposits increased 1.9 percent, and the DIF reserve ratio (the Fund balance as a percentage of estimated insured deposits) rose to 0.80 percent as of March 31 from 0.79 percent at the end of 2013. A year ago, the DIF reserve ratio was 0.60 percent. By law, the DIF must achieve a minimum reserve ratio of 1.35 percent by 2020.