U.S. DEFENSE DEPARTMENT CONTRACTS FOR JULY 18, 2014

FROM:  U.S. DEFENSE DEPARTMENT 

CONTRACTS

AIR FORCE

Lockheed Martin Aeronautics, Marietta, Georgia, has been awarded a not to exceed $564,700,000 modification (P00273) to FA8625-11-C-6597 to fund six India foreign military sales C-130J-30s, field service representatives and three years of post-delivery support after the first aircraft delivery. The total cumulative face value of the contract is $2,067,370,707. Work will be performed at Marietta, Georgia, and is expected to be completed by April 30, 2020. This contract is 100 percent FMS for India and $50,900,000 will be obligated at time of award. Air Force Life Cycle Management Center/WLNNC, Wright-Patterson Air Force Base, Ohio, is the contracting activity.

Northrop Grumman Systems Corp., doing business as Northrop Grumman Information Systems, Chantilly, Virginia, has been awarded a $300,000,000 indefinite-delivery/indefinite-quantity, cost-plus-incentive-fee contract for systems engineering, management, and sustainment (SEMS) III. Contractor will provide systems engineering, systems/program management, and sustainment services for the Air Force Weather Agency's enterprise information systems which produce and disseminate real-time weather services and products worldwide. Work will be performed primarily at the Headquarters Air Force Weather Agency, Offutt Air Force Base, Nebraska, and is expected to be completed by July 31, 2019. This award is the result of a competitive acquisition, and one offer was received. Fiscal 2014 operations and maintenance, research and development and procurement funds will be obligated with each task order. The 55th Contracting Squadron at Offutt AFB, Nebraska, is the contracting activity (FA4600-14-D-0004).

University of Dayton Research Institute (UDRI), Dayton Ohio, has been awarded an indefinite-delivery/indefinite-quantity contract and one initial task order with an estimated ceiling of $9,900,000 to meet specific research objectives to bridge the gaps and accelerate the initial development of selected nondestructive technology to a level of full-feasibility demonstration, to conduct studies of the applicability of selected technologies to a wide variety of potential applications, or development of new technologies to address specific needs. Research is contemplated to address current operational or maintenance needs. Work will be performed primarily at Wright-Patterson Air Force Base, Ohio, and the ordering period will run through July 31, 2019. All effort is expected to be completed on July 30, 2021. The award to UDRI is the result from proposals submitted in response to research and development broad agency announcement BAA-RQKM-2014-0012. Three competitive offers were received. Fiscal 2014 research and development funds in the amount of $225,000 for task order 0001 will be obligated at time of award. Air Force Research Laboratory/RQKMC, Wright-Patterson Air Force Base, Ohio, is the contracting activity (FA8650-14-D-5224, TO0001).

Raytheon Co., Tucson, Arizona, has been awarded a $8,527,198 modification (P00026) to a firm-fixed-price contract (FA8675-13-C-0003) for Advanced Medium-Range Air-to-Air Missile (AMRAAM) Production Lot 27. The total cumulative face value of the contract is $564,772,594. The contract modification provides for integration and testing for AMRAAM contract line item numbers 0008, 0009, and 0010 being produced under the basic contract. Work will be performed at Tucson, Arizona, and is expected to be completed by June 30, 2016. Foreign military sales contract funds in the amount of $8,527,198 are being obligated at the time of the award for Australia. This Air Force Life Cycle Management Center/EBAK, Eglin AFB, Florida, is the contracting activity.

NAVY

Donald L. Mooney Enterprises LLC, doing business as Nurses Etc Staffing,* San Antonio, Texas (N62645-14-D-5032); Loyal Source Government Services LLC,* Orlando, Florida (N62645-14-D-5033); Magnum Opus Technologies Inc.,* San Antonio, Texas (N62645-14-D-5034); and Vesa Health & Technology Inc.,* San Antonio, Texas (N62645-14-D-5035), are each being awarded a 36-month, firm-fixed-price, indefinite-delivery/indefinite-quantity, multiple award task order contract for various ancillary services that include the labor bands of Allied Health, Technologist, Technician and Assistant. The aggregate not-to-exceed amount for these multiple award contracts combined is $130,430,320. The four contractors will have the opportunity to bid on each individual task order. Work will be performed at the following military treatment facilities in the Pacific region of the U.S.: Naval Hospital Camp Pendleton, California (25 percent); Naval Hospital Lemoore, California (15 percent); Naval Hospital Twenty-Nine Palms, California (15 percent); Naval Medical Center, San Diego, California (10 percent); Naval Hospital Bremerton, Washington (10 percent); Naval Hospital Oak Harbor, Washington (10 percent); Naval Health Clinic Hawaii (10 percent); Naval Hospital Guam (2 percent) and any associated branch clinics (3 percent). Work is expected to be completed on Sept. 30, 2017. Availability of Fiscal 2015 Defense Health Program funds in the amount of $1,156,230 will be obligated at the time of award under initial task orders, and the funds will expire at the end of the Fiscal 2015. These contracts were solicited via a multiple award electronic request for proposals as a 100 percent service disabled veteran-owned small business set-aside, with 26 offers received. The Naval Medical Logistics Command, Fort Detrick, Maryland, is the contracting activity.

Advanced Crane Technologies LLC,* Reading, Pennsylvania, is being awarded a maximum amount $31,184,365 requirements contract for the service life extension program to modernize 14 60-ton portal cranes at Norfolk Naval Shipyard, Norfolk, Virginia; Puget Sound Naval Shipyard, Bremerton, Washington; and Portsmouth Naval Shipyard, Kittery, Maine. The work to be performed is for the modernization for all cranes and will include replacing the existing drives, modifying the operator’s controls, replacing/modifying the electric control system, replacing the crane’s diesel engine generator set, adding a rail lubrication system (as an option), adding new limit switches, replacing whip hoist wire rope and replacing outdoor conduit. Additionally, the addition of a caliper disc brake mounted on the drum and associated caliper disc brake control system will be required on the whip hoist on seven of the fourteen cranes. Task order 0001 is being awarded at $2,485,769 for modernization of crane P-82 in the Puget Sound Naval Shipyard, Bremerton, Washington, and task order 0002 at $1,992,626 for modernization of crane DC-41 in the Norfolk Naval Shipyard, Norfolk, Virginia. Work for these task orders is expected to be completed by April 2016. Work on this contract will be performed in Portsmouth, Virginia (72 percent); Bremerton, Washington (21 percent); and Kittery, Maine (7 percent), and the term of the contract is not to exceed 60 months with an expected completion date of July 2019. Fiscal 2014 other procurement (Navy) contract funds in the amount of $4,478,395 are obligated on this award and will not expire at the end of the current fiscal year. This contract was competitively procured via the Federal Business Opportunities website, with two proposals received. The Naval Facilities Engineering Command, Norfolk, Virginia, is the contracting activity (N62470-14-D-5001).
Communications & Power Industries LLC, Palo Alto, California, is being awarded an $18,841,200 firm-fixed-price, indefinite-delivery/indefinite-quantity contract for the repair and remanufacture of AN/SLQ-32 output, driver and sidekick output traveling wave tubes (TWTs) to support the repair and refurbishment of Navy ships. The AN/SLQ-32 output, driver, and sidekick output TWTs are an integral part of the AN/SLQ-32 electronic countermeasures system and are used to amplify radiofrequency energy to defeat anti-ship missile systems. Work will be performed in Palo Alto, California, and is expected to be completed by July 2019. Fiscal 2014 working capital funds in the amount of $390,252 will be obligated at time of award and will not expire at the end of the current fiscal year. This contract was competitively procured via the Federal Business Opportunities website, with one offer received. The Naval Surface Warfare Center, Crane Division, Crane, Indiana, is the contracting activity (N00164-14-D-GR37).
Detyens Shipyards Inc.,* North Charleston, South Carolina, is being awarded an $11,631,622 firm-fixed-price contract for a 75-calendar day regular overhaul and dry-docking of USNS Arctic (T-AOE 8). Work will include opening, cleaning and purging gas from tanks, voids and cofferdams; repairing and replacing various sections of weather deck handrails on the forward main mast, replenishment-at-sea and fueling-at-sea kingposts and access ladders; modifying the main reduction gear lube oil purifier; inspecting the auxiliary boiler; inspecting and weight testing the accommodation ladder; performing maintenance on gallery/scullery equipment; dry-docking and undocking; refurbishing sea valves; cleaning and painting the underwater hull; and blasting and coating tanks. Arctic’s primary mission is to deliver petroleum products, ammunition, food and other cargo to ships at sea. The contract includes options, which, if exercised, would bring the cumulative value of this contract to $15,240,367. Work will be performed in North Charleston, South Carolina, and is expected to be completed by October 2014. Navy working capital funds in the amount of $11,631,622 are being obligated at the time of award and will expire at the end of the current fiscal year. This contract was procured as a 100% small business set-aside with proposals solicited via the Federal Business Opportunities website, with two proposals received. The U.S. Navy’s Military Sealift Command, Washington, District of Columbia, is the contracting activity (N32205-14-C-2003).

Watts Constructors LLC, Honolulu, Hawaii, is being awarded a $9,395,000 firm-fixed-price contract for construction of an integrated water treatment system at Puget Sound Naval Shipyardand Intermediate Maintenance Facility, Bremerton, Washington. The work to be performed provides for infrastructure improvement to the existing system that collects and treats industrial process water at Drydock 3 and Drydock 4. This project will integrate the existing oily water treatment system with the existing process water collection system to provide increased capability and capacity for on-site collection, containment, and treatment of process water from the drydock floor. Work will be performed in Bremerton, Washington, and is expected to be completed by February 2016. Fiscal 2014 military construction (Navy) contract funds in the amount of $9,395,000 are obligated on this award and will not expire at the end of the current fiscal year. This contract was competitively procured via the Federal Business Opportunities website, with six proposals received. The Naval Facilities Engineering Command, Northwest, Silverdale, Washington, is the contracting activity (N44255-14-C-5000).

ARMY

BAE Systems Land & Armaments, York, Pennsylvania, was awarded an $88,330,859 modification (P00081) to contract W56HZV-09-C-0550 to extend the existing M109A7 and M992A3 engineering and manufacturing development contract to incorporate low rate initial production test support. Research, development, testing, and evaluation funds for fiscal 2014 ($12,295,000) and fiscal 2013 ($1,805,000) were obligated at the time of the award. Estimated completion date is March 31, 2017. Work will be performed in York, Pennsylvania. Army Contracting Command, Warren, Michigan, is the contracting activity.

UPDATE: Global Engineering LLC, Renton, Washington, has been added as an awardee to the multiple-award contract announced June 24, 2014 for construction services supporting the U.S. Army Corps of Engineers, Southwestern Division. (W91278-14-R-0030)

DEFENSE LOGISTICS AGENCY

The Hariford Provision Company,** South Windsor, Connecticut, has been awarded a maximum $83,000,000 fixed-price with economic-price-adjustment, indefinite-delivery/indefinite-quantity contract for prime vendor subsistence support. This contract was a competitive acquisition, and three offers were received. Location of performance is Connecticut with a July 18, 2016, performance completion date. This is a two-year base contract with one two-year option period. Using military services are the Navy, Air Force, Marine Corps, Coast Guard, and National Oceanic and Atmospheric Administration. Type of appropriation is Fiscal year 2014 defense working capital funds. The contracting activity is the Defense Logistics Agency Troop Support, Philadelphia, Pennsylvania (SPE300-14-D-3025).

Sysco Baraboo, Baraboo, Wisconsin, has been awarded a maximum $16,500,000 fixed-price with economic-price-adjustment contract for prime vendor food and beverage support. This contract was a competitive acquisition and two offers were received. Location of performance is Wisconsin with a July 13, 2019 performance completion date. This is a two-year base contract with one one-year and one two-year option periods. Using military services are Army and Air Force. Type of appropriation is fiscal year 2014 defense working capital funds. The contracting activity is the Defense Logistics Agency Troop Support, Philadelphia, Pennsylvania (SPE300-14-D-3029).

URS Federal Services Inc., Germantown, Maryland, has been awarded a maximum $11,767,117 modification (P00029) exercising the second option period on a one-year base contract (SP3300-12-C-5003) with three one-year option periods. This is a fixed-price, incentive-firm-target contract for material distribution services to include receipt, storage and issue of material. Locations of performance are Maryland and Utah with a July 31, 2015 performance completion date. Using service is Defense Logistics Agency. Type of appropriation is fiscal year 2014 defense working capital funds. The contracting activity is the Defense Logistics Agency Distribution, New Cumberland, Pennsylvania.

DEFENSE MEDIA ACTIVITY

Bluewater Communications Group, Hauppauge, New York (HQ0516-12-D-0001); Globecomm Systems, Hauppauge, New York (HQ0516-12-D-0002); and TVC Communications LLC, Annville, Pennsylvania (HQ0516-12-D-0003) are each being awarded $15,000,000 modifications to multiple-award, firm-fixed-price contracts to exercise the second option year to provide Cisco satellite decoders and HD encryption systems for the Defense Media Activity. Funding and work location will be determined with each order. The Defense Media Activity, Fort Meade, Maryland is the contracting activity.

*Disabled veteran-owned small business

**Small business

AG HOLDER'S REMARKS ON VOTE FOR RETROACTIVE SENTENCE REDUCTIONS FOR DRUG OFFENCES

FROM:  U.S. JUSTICE DEPARTMENT 

Friday, July 18, 2014

Statement by Attorney General Holder on Sentencing Commission Vote Approving Retroactivity of Sentence Reductions for Drug Offenses

WASHINGTON—Attorney General Eric Holder today released the following statement regarding the U.S. Sentencing Commission vote approving retroactivity of sentence reductions for drug offenses:

“The department looks forward to implementing this plan to reduce sentences for certain incarcerated individuals. We have been in ongoing discussions with the Commission during its deliberations on this issue, and conveyed the department's support for this balanced approach. In the interest of fairness, it makes sense to apply changes to the sentencing guidelines retroactively, and the idea of a one-year implementation delay will adequately address public safety concerns by ensuring that judges have adequate time to consider whether an eligible individual is an appropriate candidate for a reduced sentence. At my direction, the Bureau of Prisons will begin notifying federal inmates of the opportunity to apply for a reduction in sentence immediately. This is a milestone in the effort to make more efficient use of our law enforcement resources and to ease the burden on our overcrowded prison system.”

PRESIDENT OBAMA MAKES STATEMENT ON DOWNING OF MALAYSIAN AIRLINES FLIGHT MH17

FROM:  THE WHITE HOUSE 

Statement by the President on Ukraine

James S. Brady Press Briefing Room

11:52 A.M. EDT

THE PRESIDENT:  Good morning, everybody. 

Yesterday, Malaysian Airlines Flight MH17 took off from Amsterdam and was shot down over Ukraine near the Russian border.  Nearly 300 innocent lives were taken -- men, women, children, infants -- who had nothing to do with the crisis in Ukraine.  Their deaths are an outrage of unspeakable proportions.

We know at least one American citizen, Quinn Lucas Schansman, was killed.  Our thoughts and prayers are with his family for this terrible loss.

Yesterday, I spoke with the leaders of Ukraine, Malaysia, and the Netherlands.  I told them that our thoughts and prayers are with all the families and that the American people stand with them during this difficult time.  Later today, I’ll be speaking to Prime Minister Abbott of Australia, which also suffered a terrible loss.

By far, the country that lost the most people on board the plane was the Netherlands.  From the days of our founding, the Dutch have been close friends and stalwart allies of the United States of America.  And today, I want the Dutch people to know that we stand with you, shoulder to shoulder, in our grief and in our absolute determination to get to the bottom of what happened.

Here’s what we know so far.  Evidence indicates that the plane was shot down by a surface-to-air missile that was launched from an area that is controlled by Russian-backed separatists inside of Ukraine.  We also know that this is not the first time a plane has been shot down in eastern Ukraine.  Over the last several weeks, Russian-backed separatists have shot down a Ukrainian transport plane and a Ukrainian helicopter, and they claimed responsibility for shooting down a Ukrainian fighter jet. Moreover, we know that these separatists have received a steady flow of support from Russia.  This includes arms and training.  It includes heavy weapons, and it includes anti-aircraft weapons. 

Here’s what must happen now.  This was a global tragedy.  An Asian airliner was destroyed in European skies, filled with citizens from many countries.  So there has to be a credible international investigation into what happened.  The U.N. Security Council has endorsed this investigation, and we will hold all its members -- including Russia -- to their word.  In order to facilitate that investigation, Russia, pro-Russian separatists, and Ukraine must adhere to an immediate cease-fire.  Evidence must not be tampered with.  Investigators need to access the crash site.  And the solemn task of returning those who were lost on board the plane to their loved ones needs to go forward immediately.

The United States stands ready to provide any assistance that is necessary.  We’ve already offered the support of the FBI and the National Transportation Safety Board, which has experience in working with international partners on these types of investigations.  They are on their way, personnel from the FBI and the National Transportation Safety Board. 

In the coming hours and days, I’ll continue to be in close contact with leaders from around the world as we respond to this catastrophe.  Our immediate focus will be on recovering those who were lost, investigating exactly what happened, and putting forward the facts. 

I want to point out there will likely be misinformation as well.  I think it's very important for folks to sift through what is factually based and what is simply speculation.  No one can deny the truth that is revealed in the awful images that we all have seen.  And the eyes of the world are on eastern Ukraine, and we are going to make sure that the truth is out.

More broadly, I think it's important for us to recognize that this outrageous event underscores that it is time for peace and security to be restored in Ukraine.  For months, we’ve supported a pathway to peace, and the Ukrainian government has reached out to all Ukrainians, put forward a peace plan, and lived up to a cease-fire, despite repeated violations by the separatists -- violations that took the lives of Ukrainian soldiers and personnel.

Moreover, time and again, Russia has refused to take the concrete steps necessary to deescalate the situation.  I spoke to President Putin yesterday in the wake of additional sanctions that we had imposed.  He said he wasn’t happy with them, and I told him that we have been very clear from the outset that we want Russia to take the path that would result in peace in Ukraine, but so far at least, Russia has failed to take that path.  Instead, it has continued to violate Ukrainian sovereignty and to support violent separatists.  It has also failed to use its influence to press the separatists to abide by a cease-fire.  That’s why, together with our allies, we’ve imposed growing costs on Russia.

So now is, I think, a somber and appropriate time for all of us to step back and take a hard look at what has happened.  Violence and conflict inevitably lead to unforeseen consequences.  Russia, these separatists, and Ukraine all have the capacity to put an end to the fighting.  Meanwhile, the United States is going to continue to lead efforts within the world community to de-escalate the situation; to stand up for the sovereignty and territorial integrity of Ukraine; and to support the people of Ukraine as they courageously work to strengthen their democracy and make their own decisions about how they should move forward.

Before I take just a couple of questions let me remark on one other issue.  This morning, I spoke with Prime Minister Netanyahu of Israel about the situation in Gaza.  We discussed Israel’s military operation in Gaza, including its efforts to stop the threat of terrorist infiltration through tunnels into Israel.  I reaffirmed my strong support for Israel’s right to defend itself.  No nation should accept rockets being fired into its borders, or terrorists tunneling into its territory.  In fact, while I was having the conversation with Prime Minister Netanyahu, sirens went off in Tel Aviv.

I also made clear that the United States, and our friends and allies, are deeply concerned about the risks of further escalation and the loss of more innocent life.  And that’s why we’ve indicated, although we support military efforts by the Israelis to make sure that rockets are not being fired into their territory, we also have said that our understanding is the current military ground operations are designed to deal with the tunnels, and we are hopeful that Israel will continue to approach this process in a way that minimizes civilian casualties and that all of us are working hard to return to the cease-fire that was reached in November of 2012. 

Secretary Kerry is working to support Egypt’s initiative to pursue that outcome.  I told Prime Minister Netanyahu that John is prepared to travel to the region following additional consultations.

Let me close by making one additional comment.  On board Malaysian Airlines Flight MH17, there were apparently nearly 100 researchers and advocates traveling to an international conference in Australia dedicated to combating AIDS/HIV.  These were men and women who had dedicated their own lives to saving the lives of others and they were taken from us in a senseless act of violence.

In this world today, we shouldn’t forget that in the midst of conflict and killing, there are people like these -- people who are focused on what can be built rather than what can be destroyed; people who are focused on how they can help people that they’ve never met; people who define themselves not by what makes them different from other people but by the humanity that we hold in common.  It’s important for us to lift them up and to affirm their lives.  And it’s time for us to heed their example. 

The United States of America is going to continue to stand for the basic principle that people have the right to live as they choose; that nations have the right to determine their own destiny; and that when terrible events like this occur, the international community stands on the side of justice and on the side of truth. 

So with that, let me take just a couple questions.  I’ll start with you, Julie.

Q    Thank you, Mr. President.  Just on a technical matter, does the U.S. believe that this passenger jet was targeted, or that those people who shot it down may have been going after a military -- thought they were going after a military aircraft?  And more broadly, this incident does seem to escalate the crisis in Ukraine to a level we haven’t seen before.  Does that change your calculus in terms of what the U.S. and perhaps Europe should be doing in terms of a response?

THE PRESIDENT:  Well, I think it’s too early for us to be able to guess what the intentions of those who might have launched this surface-to-air missile might have had.  The investigation is going to be ongoing, and I think what we’ll see is additional information surfacing over the next 24 hours, 72 hours, the next week, the next month.

What we know right now, what we have confidence in saying right now is that a surface-to-air missile was fired and that's what brought the jet down.  We know -- or we have confidence in saying that that shot was taken within a territory that is controlled by the Russian separatists. 

But I think it’s very important for us to make sure that we don't get out ahead of the facts.  And at this point, in terms of identifying specifically what individual or group of individuals or personnel ordered the strike, how it came about, those are things that I think are still going to be subject to additional information that we’re going to be gathering.  And we’re working with the entire international community to make sure that the focus is on getting to the bottom of this thing and being truthful.

And my concern is obviously that there’s been a lot of misinformation generated in eastern Ukraine generally.  This should snap everybody’s heads to attention and make sure that we don't have time for propaganda, we don't have time for games.  We need to know exactly what happened.  And everybody needs to make sure that we’re holding accountable those who committed this outrage.

With respect to the second question, as you’re aware, before this terrible incident happened we had already ratcheted up sanctions against Russia.  And I think the concern not just of Russian officials but of the markets about the impact that this could have on the Russian economy is there for all to see.

I made clear to President Putin that our preferred path is to resolve this diplomatically.  But that means that he and the Russian government have to make a strategic decision:  Are they going to continue to support violent separatists whose intent is to undermine the government of Ukraine?  Or are they prepared to work with the government of Ukraine to arrive at a cease-fire and a peace that takes into account the interests of all Ukrainians?

There has been some improved language at times over the last month coming from the Kremlin and coming from President Putin, but what we have not seen is an actual transition and different actions that would give us confidence that that's the direction that they want to take.

And we will continue to make clear that as Russia engages in efforts that are supporting the separatists, that we have the capacity to increase the costs that we impose on them.  And we will do so.  Not because we’re interested in hurting Russia for the sake of hurting Russia, but because we believe in standing up for the basic principle that a country’s sovereignty and territorial integrity has to be respected, and it is not the United States or Russia or Germany or any other country that should be deciding what happens in that country.

Q    At this point do you see any U.S. military role that could be effective?

THE PRESIDENT:  We don't see a U.S. military role beyond what we’ve already been doing in working with our NATO partners and some of the Baltic States, giving them reassurances that we are prepared to do whatever is required to meet our alliance obligations.

Steve Holland.

Q    Sir, thank you.  How much blame for this do you put on President Putin?  And will you use this incident now to push the Europeans for stronger action?

THE PRESIDENT:  We don't exactly know what happened yet, and I don't want to, as I said before, get out ahead of the facts.  But what I do know is, is that we have seen a ticking up of violence in eastern Ukraine that, despite the efforts of the Ukrainian government to abide by a cease-fire and to reach out and agree to negotiations, including with the separatists, that has been rebuffed by these separatists.  We know that they are heavily armed and that they are trained.  And we know that that’s not an accident.  That is happening because of Russian support.

So it is not possible for these separatists to function the way they’re functioning, to have the equipment that they have -- set aside what’s happened with respect to the Malaysian Airlines -- a group of separatists can’t shoot down military transport planes or, they claim, shoot down fighter jets without sophisticated equipment and sophisticated training.  And that is coming from Russia.

So we don’t yet know exactly what happened with respect to the Malaysian Airlines, although obviously we’re beginning to draw some conclusions given the nature of the shot that was fired.  There are only certain types of anti-aircraft missiles that can reach up 30,000 feet and shoot down a passenger jet.  We have increasing confidence that it came from areas controlled by the separatists.  But without having a definitive judgment on those issues yet, what we do know is, is that the violence that’s taking place there is facilitated in part -- in large part -- because of Russian support.  And they have the ability to move those separatists in a different direction.

If Mr. Putin makes a decision that we are not going to allow heavy armaments and the flow of fighters into Ukraine across the Ukrainian-Russian border, then it will stop.  And if it stops, then the separatists will still have the capacity to enter into negotiations and try to arrive at the sort of political accommodations that Mr. Putin himself says he wants to see.  He has the most control over that situation, and so far, at least, he has not exercised it.

Q    Tougher sanctions in Europe -- will you push for them?

THE PRESIDENT:  Well, I think that this certainly will be a wake-up call for Europe and the world that there are consequences to an escalating conflict in eastern Ukraine; that it is not going to be localized, it is not going to be contained.  What we’ve seen here is -- just in one country alone, our great allies, the Dutch, 150 or more of their citizens being killed.  And that, I think, sadly brings home the degree to which the stakes are high for Europe, not simply for the Ukrainian people, and that we have to be firm in our resolve in making sure that we are supporting Ukraine in its efforts to bring about a just cease-fire and that we can move towards a political solution to this.

I’m going to make this the last question.  Lisa Lerer, Bloomberg.

Q    Do we know yet if there were other Americans on board beyond the person you mentioned?  And how do you prevent stricter restrictions, economic sanctions from shocking the global economy and -- 

THE PRESIDENT:  We have been pretty methodical over the last 24 hours in working through the flight manifest and identifying which passengers might have had a U.S. passport.  At this point, the individual that I mentioned is the sole person that we can definitively say was a U.S. or dual citizen. 

Because events are moving so quickly, I don’t want to say with absolute certainty that there might not be additional Americans, but at this stage, having worked through the list, been in contact with the Malaysian government, which processed the passports as folks were boarding, this is our best assessment of the number of Americans that were killed.  Obviously that does nothing to lessen our outrage about all those families.  Regardless of nationality, it is a heartbreaking event.

With respect to the effect of sanctions on the economy, we have consistently tried to tailor these sanctions in ways that would have an impact on Russia, on their economy, on their institutions or individuals that are aiding and abetting in the activities that are taking place in eastern Ukraine, while minimizing the impacts on not only the U.S. economy but the global economy. 

It is a relevant consideration that we have to keep in mind.  The world economy is integrated; Russia is a large economy; there’s a lot of financial flows between Russia and the rest of the world.  But we feel confident that at this point the sanctions that we’ve put in place are imposing a cost on Russia, that their overall impact on the global economy is minimal.  It is something that we have to obviously pay close attention to, but I think Treasury, in consultation with our European partners, have done a good job so far on that issue.

Thank you very much, everybody.

END
12:15 P.M. EDT

LLRV TESTING CONTRIBUTED TO APOLLO 11'S SUCCESS

ASSOCIATE AG WEST'S REMARKS ON RESIDENTIAL MORTGAGE-BACKED SECURITIES (RMBS) MISCONDUCT

FROM:  U.S. JUSTICE DEPARTMENT 

Associate Attorney General Tony West Outlines Justice Department’s Approach to Toxic Mortgage Cases

~ Wednesday, July 16, 2014

Two days after the historic Citigroup settlement, Associate Attorney General Tony West outlined the Justice Department’s approach to resolving the remaining cases related to Residential Mortgage-Backed Securities (RMBS) misconduct that contributed to the financial crisis.  West declared that the department would not hesitate to bring litigation against these firms if these principles were not met.

Associate Attorney General West detailed three general principles that will continue to guide the Justice Department’s approach in all future RMBS cases: accountability, transparency and redress.  These principles will comprise of civil penalties, a robust statement of facts and consumer relief for the American people.

“If an institution is unwilling to admit its wrongful conduct in a statement of facts; or balks at paying a substantial penalty that reflects that conduct; or refuses to do right by those affected, then we will not shrink from litigating as long as we must to fulfill our law enforcement mandate,” said Associate Attorney General West.

Please see below for the Associate Attorney General’s prepared remarks:

Thank you, Mike [Bresnick] for the generous introduction.  We miss your wise counsel at the department.

I am quite pleased to be with you here this afternoon at the Exchequer Club.  For more than 50 years, this club has served as an important forum for the frank exchange of ideas on the most pressing economic and financial issues in the country.  And, having spent more than two years as the nation's Associate Attorney General and more than five years as a member of this administration's Department of Justice, I particularly appreciate the opportunity to be with all of you -- an impressive group of leaders from the public and private sectors.

The people in this room are making important contributions that enrich our nation ’s economic life.  You are grappling with the challenge of improving the financial health of this country -- in the work you do, the words you write, the ideas you debate and put forward.  And in the wake of the Great Recession, I believe we share a common goal of ensuring that our nation is economically strong, fiscally sound and financially fair.

Today, I thought I would share some thoughts on the last of those three elements -- financial fairness -- and the Justice Department's role in helping to achieve that goal by targeting fraud in our financial system.  First, I'll talk about some of our recent financial fraud efforts, and particularly the work of the Residential Mortgage-Backed Securities Working Group.  Next, I'll share a couple of brief observations about how we approach these RMBS cases.  And finally, I'll discuss some of the factors we consider when determining whether to sue or settle these large, often multi-billion dollar RMBS-related fraud matters.

Let me begin with the observation that much of my tenure as Associate Attorney General has been focused on executing the department's financial fraud priorities, particularly through the use of civil enforcement tools, as my office manages the civil litigation side of the Justice Department.

Part of this focus grows out of the precedent set by my predecessor, Tom Perrelli.  He, along with HUD Secretary Shaun Donovan and several state attorneys general, negotiated a landmark $25 billion National Mortgage Servicer settlement with several financial institutions that was designed to bring some relief to consumers hurt by unfair and, in some cases, illegal loan servicing tactics.

And part of it comes from my own experience: I grew up professionally in the Justice Department, serving first as young lawyer on then-Deputy Attorney General Jamie Gorelick's staff in the early '90s, then for several years as a federal prosecutor in the Northern District of California where my caseload included white-collar crime.

When the president nominated and the Senate confirmed me as the Civil Division's Assistant Attorney General in 2009, I returned to the department and made, as one of my primary priorities, the aggressive use of the civil statutory authority Congress provided us to fight fraud in the pharmaceutical and health care industries.  During that time, I also launched an investigation of Standard & Poor’s Ratings Services for allegedly issuing RMBS ratings that were not objective and independent.

And during 2009, that first year of the Obama Administration, you'll recall we were all preoccupied with addressing the wreckage left by the financial crisis.  As part of that response, in November 2009, President Obama created the Financial Fraud Enforcement Task Force, or FFETF, on which I serve as a co-chair and which Mike Bresnick led as Executive Director before returning to private practice.  And since its inception, the FFETF has brought together a broad coalition of agencies, enforcement tools and resources to fight fraud.

A critical component of the FFETF's efforts is a targeted group formed, as the president said in his 2011 State of the Union Address, to “hold accountable those who broke the law, speed assistance to homeowners, and help turn the page on an era of recklessness that hurt so many Americans.”  That group – the Residential Mortgage Backed Securities Working Group -- comprised of several state agencies and state attorneys general -- is charged with investigating fraud in the packaging, marketing, sale and issuance of these securities -- conduct that was a major contributing factor to the financial crisis.

To date, the efforts of the RMBS Working Group have secured $20 billion in penalties, compensation and consumer relief to investors, victims and the American people.  Those results include the $13 billion resolution with J.P. Morgan last November -- the largest settlement against a single defendant in the Justice Department's history -- and a $7 billion resolution with Citibank announced just two days ago, which made history by including a record-breaking civil penalty of $4 billion.

Now, resolutions like these -- notwithstanding their record-breaking size or historic significance -- always seem to spark a debate between those who say we're being too easy on the big banks and those who say we're being too tough.  To some, no penalty is high or harsh enough; to others, we insist on settlement terms that are unfairly punitive.

I welcome this debate because it is part of a long, democratic tradition of questioning the activities our government takes in the name of the people it serves.  And while I am quite certain there is little I can say to persuade the most ardent partisans on either side of this debate, let me offer the following observations:

First, the RMBS Working Group settlements we have announced to date are civil resolutions; they do not preclude the possibility of criminal prosecutions.  Importantly, neither the J.P. Morgan nor the Citibank settlement agreements absolve either institution or its employees from possible criminal charges.  And as the recent criminal pleas of BNP and Credit Suisse –  as well as the more than 37,000 individual white collar criminals we have prosecuted over the last five years – demonstrate, we do not hesitate to aggressively investigate allegations of financial wrongdoing, and, if the evidence warrants, to demand accountability.  Because, as the Attorney General has said before, no institution, no matter how large, and no individual, no matter how powerful, is above the law.

Second, while most of the attention has been focused on these multi-billion dollar settlements, let me be clear: we do not investigate these matters intending to settle them.  Through the RMBS Working Group, we have assembled an enforcement apparatus to vindicate those who fell victim to the financial crisis, and that apparatus continues to grow.  Resolving these cases will require more than simply seeking a meeting with the Attorney General.  It will require taking true responsibility for misconduct that contributed to the Great Recession, which I will discuss more in a moment.  If an institution is unwilling to admit its wrongful conduct in a statement of facts; or balks at paying a substantial penalty that reflects that conduct; or refuses to do right by those affected, then we will not shrink from litigating as long as we must to fulfill our law enforcement mandate.  Our RMBS-related cases against S&P in California and Bank of America in North Carolina demonstrate this, and I would not be surprised if we were to see additional RMBS lawsuits in the future.

And that observation leads me to the next topic I wanted to discuss today: those factors we consider when determining how and whether we will sue or settle a RMBS fraud case.  And let me note here: I'm talking about whether we will pursue or settle a civil RMBS case against an institution, not a financial fraud case that's being considered for criminal prosecution against an institution or individual, so my comments are limited to that context.

Now, as a general matter, it should be no surprise that the primary drivers in any RMBS fraud case will be the facts and evidence of that particular case.  The conduct at issue; the egregiousness of that conduct and who was involved; the quality of the evidence and what we can prove in court given the applicable law -- those are the scene-setters for any discussion about how we will resolve any given case.

And long before discussions get to my level, there have usually been months of back-and-forth conversations between the investigators and Assistant U.S.  Attorneys who will try the case and the potential bank defendant to make sure our facts are right and our theory of the case is sound.

So by the time I am sitting across the table from a financial institution to discuss whether we will settle or sue, there aren't generally many facts that remain in dispute.  The main question on the table is whether we will be able to satisfy three general principles that guide us in all of these cases: accountability, transparency and redress.

Let me discuss each one in turn.

First, accountability.  The main question here, of course, is whether the financial institution is willing to be held accountable for the harmful conduct our investigation has uncovered.  In other words, now that we have developed an evidentiary record of wrongdoing, is the institution willing to step up and accept responsibility for the unlawful activity, be it the conduct of the parent or a subsidiary?

In the RMBS-related cases we pursue, the only remedy under FIRREA (Financial Institutions Reform, Recovery and Enforcement Act of 1989) that the government can seek, besides injunctive relief, is a civil penalty.  As many of you know, FIRREA was passed in response to the savings and loan crisis 30 years ago, and under that statute, civil penalties are our only recourse.

So it follows that in many of these cases, accountability has taken the form of record-breaking civil penalties.  And our approach to calculating the appropriate penalty in any given case involves taking into account a number of factors, including but not limited to:  the egregiousness and pervasiveness of the conduct, and amount of harm caused by that conduct; the strength of the evidence; whether the penalty is of such a level that it could be regarded by shareholders and management as merely the “cost of doing business”; whether the institution has failed to fully cooperate with our investigation; and whether any steps have been taken to remediate meaningfully the harm caused by the harmful conduct.

Now, some have argued that other considerations, such as a firm’s market share, should outweigh the facts and evidence in a given case.  We disagree.  While a firm's market share footprint may be among the informational data points we consider, it is not determinative.  The facts and evidence of a particular case -- they are what will ultimately matter the most.

Let me turn to the second principle, transparency.  In every RMBS Working Group case where there is a negotiated resolution short of trial, we will demand a statement of facts in which the institution admits the conduct at issue.

Attorney General Holder has made this a non-negotiable term of every RMBS Working Group settlement for two reasons:  First, it's an important component of accountability.  It requires the institution to articulate to its own employees, its shareholders and to the public that it engaged in conduct that is both unacceptable and wrong.  Second, it explains to the American people what our investigation uncovered and allows them to see for themselves the building blocks of our case against the institution.

In both JPMorgan and Citibank, the Attorney General and I believed it was imperative for each institution to acknowledge publicly its conduct, and we believe that obtaining a statement of facts in any negotiated resolution is as important as any monetary penalty.

Finally, let's talk about redress. 

As we all know, the packaging up of defective loans into mortgage backed securities, and the misrepresentations made to investors about the quality of those securities not only caused financial losses to investors; it contributed to the near-collapse of our entire economy.  Millions of Americans who had no idea what an RMBS was felt the pain of this conduct.  Families lost homes.  Communities were ravaged by foreclosures.  You had neighborhood streets that had vacant house after vacant house, like a mouthful of missing teeth.  This debacle hurt everybody.

So when the president announced the formation of the RMBS Working Group, he gave it two main objectives: seek accountability where the facts warrant, and pursue efforts to remediate the harm where possible.

That is why the pre-trial resolutions of these cases to date have contained, as a major element, relief for consumers.  In the J.P. Morgan resolution, we insisted on the bank providing $4 billion of relief to underwater homeowners and potential homebuyers, including those in distressed areas of the country.  Half of that total will go towards forgiveness and forbearance of principal for qualifying homeowners who are currently paying a mortgage.  The other half will go towards rate reductions or refinancing, low-to-moderate income and disaster area lending, and neighborhood stabilization programs.

In the Citibank settlement , we have required $2.5 billion in consumer relief.  In addition to loan modifications and refinancing assistance, as we did in J.P.  Morgan, we worked with Citibank and our colleagues at the Department of Housing and Urban Development to include innovative measures that will create affordable rental housing for families who were pushed into the rental market by the financial crisis; significant investments in community development and neighborhood stabilization efforts around the country; and interest rate reductions for those responsible borrowers who have responsibly kept current on their mortgages but for whom it's been a struggle because their rates are so high.

Now, we know these measures won't cure every ill or solve every problem created by the financial crisis; but they are significant steps, and we are optimistic that they will bring some much-needed relief to those who are still feeling the ill effects of what the president called "an era of recklessness" in our financial markets.

So let me close by saying that I believe we have achieved a great deal in fighting financial fraud since the formation of the RMBS Working Group: record civil penalties; factual statements that evidence an unprecedented level of accountability from the financial institutions and transparency to the marketplace; and consumer relief for the American people.

But equally important is the fact that we are not done yet.  As I said on Monday, we're not letting up, and we're not going away.  We will continue to pursue these cases and follow the facts wherever they lead and enforce the law fairly but aggressively should we uncover evidence of unlawful conduct.  Because a level financial playing field requires that type of oversight and the American people deserve no less.

Thank you.

DOD REQUESTS $58.6 BILLION FOR OVERSEAS CONTINGENCY OPERATIONS FUNDS FOR 2015

FROM:  U.S. DEFENSE DEPARTMENT

Contingency Funds Support Operations, Recovery, New Missions

By Claudette Roulo

DoD News, Defense Media Activity

WASHINGTON, July 16, 2014 – The Defense Department’s request for $58.6 billion in fiscal year 2015 overseas contingency operations funds is nearly one-third less than it received the previous year and is part of a continued downward trend in war-related spending, Deputy Defense Secretary Bob Work told Congress today.

But even as the war in Afghanistan ends, the department will continue to seek OCO funding for the repair and replacement of worn-out and damaged equipment, a process that will continue well beyond 2015, Work said at a hearing of the House Armed Services Committee.

The funds also support the costs associated with the broader presence in Southwest Asia and the Middle East, and with responses to unforeseen contingencies, he said.

The requested OCO funds will support troops who already are serving in harm’s way in Afghanistan and elsewhere in the U.S. Central Command area of operations and “who every day are conducting operations on behalf of our nation’s security in what is becoming a very volatile, complex and dangerous world,” he said.
“The requested funds for 2015 would provide $53.4 billion for Operation Enduring Freedom,” the deputy secretary said. “This funding will support the responsible drawdown of forces in Afghanistan as announced by the president.
“It will pay for the retrograde of equipment and personnel and the continued reset of forces,” he continued. “And it will enable a really vast range of support activities in theater, including logistics and intelligence. And it will support a portion of the temporary Army and Marine Corps end strength that supports OEF.”
The costs in Afghanistan and the greater Middle East region remain substantial, Work said. In Afghanistan, the U.S. military is transitioning from a combat role to a support and counterterrorism mission, the deputy secretary told committee members.
“This will require high-end intelligence, surveillance and reconnaissance assets, close air support, force protection, and logistics into next year,” he explained. “We also must return thousands of pieces of equipment from Afghanistan to our home stations and close down hundreds of combat facilities there.”

The OCO request also provides continued support and assistance to Afghan security forces, the deputy secretary said.

“Over the last year, these forces have demonstrated tactical superiority over the Taliban, and have prevented the Taliban from gaining momentum, as demonstrated by their professionalism in the most recent national elections,” he said. “We believe it is critically important that we maintain sufficient financial support for these forces so they can sustain those gains and continue to assume full responsibility across Afghanistan.”

The 2015 request also includes funding for two new presidential initiatives, Work said.

The $5 billion requested for the counterterrorism partnerships fund is intended to underwrite training, capacity-building and facilitation of partner nations battling terrorism.

About $4 billion from the counterterrorism partnerships fund will go to the Defense Department, he said. “The overall goal is, one, to increase the ability of our partner countries … to conduct counterterrorism operations, and, two, prevent the proliferation of terrorist threats from neighboring states, and, three, participate in multinational counterterrorism operations, including countering [the Islamic State of Iraq and the Levant] and other terrorist groups in the region.”

A separate $1 billion request for the European reassurance initiative will fund increased exercises and training, as well as a beefed-up rotational presence across Europe, particularly in the territory of newer allies.

“We believe that a more temporary increase in rotational U.S. air, land and sea presence in Europe, especially in Central and Eastern Europe, along with more extensive bilateral and multilateral exercises and training, are necessary and appropriate demonstrations of support to our NATO allies and partners who are deeply concerned by Russia’s occupation and attempted annexation of Crimea and other provocative actions in Ukraine,” Work said.

DOD VIDEO: FIGHTING WILDFIRES

WHITE HOUSE FACT SHEET ON 21ST CENTURY INFRASTRUCTURE

FROM:  THE WHITE HOUSE

FACT SHEET: Building a 21st Century Infrastructure: Increasing Public and Private Collaboration with the Build America Investment Initiative

Today, the President will deliver remarks at the Port of Wilmington in front of the I-495 Bridge in Delaware. With 90,000 cars moving over it per day before repairs began, this bridge is a key example of the importance of infrastructure, which keeps the economy moving, spurs innovation, and bolsters our national competitiveness. At the port – and in this Year of Action – the President will announce a new executive action to create the Build America Investment Initiative, a government-wide initiative to increase infrastructure investment and economic growth. As part of the Initiative, the Administration is launching the Build America Transportation Investment Center – housed at the Department of Transportation – to serve as a one-stop shop for cities and states seeking to use innovative financing and partnerships with the private sector to support transportation infrastructure.

The President’s visit and announcement today are a part of the Administration’s continued push to highlight the importance of investing in our nation’s infrastructure so that we can build on the progress our economy is making by creating jobs and expanding opportunity for all hardworking Americans. The steps announced today continue the momentum the President has made using his executive authority – his pen and phone – to invest in modernizing our infrastructure, including speeding up the permitting process for major infrastructure projects to create more jobs.

The President supports the steps that Congress is taking in the short-term to avoid a lapse in the Highway Trust Fund, and he will continue to push for long-term solutions for our nation’s infrastructure and the American economy.

***

Investing in a 21st century American infrastructure is an important part of the President’s plan to build on the progress our economy is making by creating jobs and expanding opportunity for all hardworking Americans.  Modern and efficient infrastructure – whether moving goods to our harbors and ports or connecting people to services or gigabits to our offices and homes – helps small businesses to expand, manufacturers to export, investors to bring jobs to our shores, and lowers prices for goods and services for American families.

The President has been very clear that we need to do more to improve our infrastructure in order to create jobs, provide certainty to states and communities, help American businesses, and grow our economy.  He has put forth a long-term proposal that would do just that and pay for it by closing unfair tax loopholes and making commonsense reforms to our business tax system, while providing the certainty of reliable federal funding to states and communities.

And while the President is encouraged that Congress is heeding these calls by taking action in the short-term to prevent transportation projects across the country from grinding to a halt, the President will continue to act on his own to promote American economic growth where there is need or opportunity.  And right now, there is a real opportunity to put private capital to work in revitalizing U.S. infrastructure.

That is why today, the President will sign a Presidential Memorandum to launch the Build America Investment Initiative, a government-wide initiative to increase infrastructure investment and economic growth by engaging with state and local governments and private sector investors to encourage collaboration, expand the market for public-private partnerships (PPPs) and put federal credit programs to greater use.  Starting with the transportation sector, this initiative will harness the potential of private capital to complement government funding.

Ø  As part of the Initiative, the Administration is launching the Build America Transportation Investment Center:  Housed at the Department of Transportation, this center will serve as a one-stop shop for state and local governments, public and private developers and investors seeking to utilize innovative financing strategies for transportation infrastructure projects.  Additional details are below.
Build America Interagency Working Group: To expand and increase private investment and collaboration in infrastructure beyond the transportation sector, a federal inter-agency working group, co-chaired by Cabinet Secretaries Lew and Foxx, will do a focused review with the best and the brightest from the public and private sector.  This group will work with state and local governments, project developers, investors and others to address barriers to private investments and partnerships in areas including municipal water, ports, harbors, broadband, and the electrical grid. The effort will include a particular focus on improving coordination to accelerate financing and completion of projects of regional and national significance, particularly those that cross state boundaries.
Infrastructure Investment Summit:  As part of the drive toward innovative infrastructure solutions and to highlight the opportunities for infrastructure investment, the Treasury Department will host a summit on Infrastructure Investment in the U.S. on September 9, 2014.  This session will bring together leading project developers and institutional investors with state and local officials and their Federal counterparts, and will focus on innovative financing approaches to infrastructure, and highlight other resources that support project development.
***

Build America Transportation Investment Center: Housed at the Department of Transportation, this center will serve as a one-stop shop for state and local governments, public and private developers and investors seeking to utilize innovative financing strategies for transportation infrastructure projects. This center will provide:

‘Navigator Service’ for the Public and Private Sector: Through hands-on support, advice and expertise, the center will make DOT credit programs more understandable and accessible to states and local governments and leverage both public and private funding to support ambitious projects.  The center will also provide private sector developers and infrastructure investors with tools and resources to identify and execute successful PPPs.

Improved Access to DOT Credit Programs: The center will encourage awareness and efficient use of existing resources at the Department, including the Transportation Infrastructure Finance and Innovation Act (TIFIA) program.  TIFIA provides long-term, flexible financing to highway and transit projects that feature dedicated revenue sources.  Each dollar of Federal TIFIA funding can support about $10 in loans, loan guarantees or lines of credit.  In many cases, the lower cost of capital and flexible terms offered by TIFIA are critical factors in determining whether a PPP is a viable and cost-effective option for a project. The center will also focus on the use of key DOT programs including the Private Activity Bond program (PABs), and the Railroad Rehabilitation and Improvement Financing Program (RRIF).

Technical Assistance: The center will share best practices from states that are leading the way on private investment to states that have not yet adopted innovative financing strategies, encouraging a more robust national market. Today, the top six states for PPPs have nearly two-thirds the value of all U.S. PPP projects. Twenty states have no PPPs in transportation at all. The center will provide technical assistance to help remove barriers to ensure the public and private sector can come together to complete projects that make sense. Through a website and on-demand technical assistance, the center will provide information about DOT credit programs, case studies of successful projects and examples of deal structures, standard operating procedures for PPP projects and analytical toolkits. It will also help interested investors better understand how DOT credit and grant programs can be used together to support project development.
Information to Reduce Uncertainty and Delays: The center will work in partnership with the interagency Infrastructure Permitting Improvement center to provide visibility for local and state governments, project sponsors and investors on the permitting process.

Case Studies and Additional Background

The Build America Investment Initiative taps into the opportunity to increase the pipeline of effective public-private-partnerships and other innovative financing mechanisms:

High Demand: Institutional investors, both domestic and international, recognize the strength of our economy and want to invest in America. In 2013, the U.S. was the top destination for foreign direct investment with over $230 billion.  The global investment community has over $83 trillion dollars with a growing appetite for infrastructure. That is potentially hundreds of billions of dollars to fund the building of U.S. public-private infrastructure.

Proven Approaches: Some states and communities have established successful PPPs and have developed strong institutional knowledge of how these projects are best structured and managed.  Expanding that know-how to other states has the potential to increase the flow of capital by tens of billions of dollars over the next few years. Today, for example, the top five states in PPPs have nearly twice the per-capita value of projects as the next 20 best states – and if those states caught up, it could mean up to $30 billion worth of infrastructure projects.

Building on Models of Success: Some states and localities across the country have developed successful track records utilizing PPPs and other innovative financing approaches for infrastructure projects.  The Build America Transportation Investment center will use the lessons-learned from these leaders to help other communities and private project sponsors understand and better use federal financing programs and to structure deals that incorporate best practices and avoid pitfalls.

Case Study: Colorado FasTracks Project

Denver, Colorado is a community that has shown how transformative, multi-modal public infrastructure projects can be brought to fruition by integrating multiple financing sources.  Denver was able to utilize a PPP as part of the FasTracks development – combining light rail, bus rapid transit, development of Denver Union Station, parking, and other improvements – alongside state and federal funding.

The FasTracks Eagle project in Denver is a $2.2 billion public-private partnership to construct two new commuter rail lines.  The project combined several DOT funding and financing mechanisms – Federal Transit Administration’s New Starts, Private Activity Bonds, and a TIFIA loan – in addition to other Federal, State, and local resources and private investment.

The Eagle project is using a “design-build-finance-operate-maintain” contract under a 34-year concession.  Denver will retain ownership of the assets, set fares and fare policies, and keep all project revenues.  Denver will make payments to the private investor and operator (“concessionaire”) based on performance metrics.


Case Study: Florida

Florida has been leading the way on PPPs since 2001. In 2007, the State of Florida established the Office of Public-Private Partnerships; since then the state has completed over $6 billion in innovative projects.

Florida is now using a public-private partnership to complete the $1.1 billion Port of Miami Tunnel Project that will link the Port of Miami with the MacArthur Causeway and I-395 on the mainland. The project, like many PPPs around the country, took advantage of DOT’s TIFIA loan program for a $340 million loan, which in turn leveraged private dollars – a great example of the kinds of partnerships that the new Build America Transportation Investment center will bolster.

THE GROW AMERICA ACT

The Highway Trust Fund – which funds a significant portion of the construction and capital repairs of our surface transportation system – is projected to be insolvent by the end of the summer barring Congressional action.  In addition to preventing the Trust Fund from expiring in the short term, the President has clear that we need long-term action and predictable funding to provide certainty to states and communities, help American businesses, and grow our economy.

In spring 2014, President Obama transmitted to Congress his vision for a long-term solution.  The GROW AMERICA Act, a $302 billion, four-year transportation reauthorization proposal provides increased and stable funding for our nation’s highways, bridges, transit, and rail systems, ends the cycle of short-term, manufactured funding crises and builds confidence in the public and private sector.

The Administration’s proposal is funded by supplementing current revenues with $150 billion in one-time transition revenue from pro-growth business tax reform.  In other words, the President’s proposal is fully paid for without increasing the deficit. The President’s proposal will also keep the Trust Fund solvent for four years and increase investments to meet the transportation priorities and economic needs of communities across the country.

The proposal also contains a series of legislative proposals to improve the return on transportation spending and improve safety, including a title on improving project delivery, and the federal permitting and regulatory review process.

CLAYS STUDIED FOR SUPERBUG KILLING PROPERTIES

 FROM:  NATIONAL SCIENCE FOUNDATION 

New answer to MRSA, other 'superbug' infections: clay minerals?

Researchers discover natural clay deposits with antibacterial properties

Superbugs, they're called: Pathogens, or disease-causing microorganisms, resistant to multiple antibiotics.

Such antibiotic resistance is now a major public health concern.

"This serious threat is no longer a prediction for the future," states a 2014 World Health Organization report, "it's happening right now in every region of the world and has the potential to affect anyone, of any age, in any country."

Could the answer to this threat be hidden in clays formed in minerals deep in the Earth?

Biomedicine meets geochemistry

"As antibiotic-resistant bacterial strains emerge and pose increasing health risks," says Lynda Williams, a biogeochemist at Arizona State University (ASU), "new antibacterial agents are urgently needed."

To find answers, Williams and colleague Keith Morrison of ASU set out to identify naturally-occurring antibacterial clays effective at killing antibiotic-resistant bacteria.

The scientists headed to the field--the rock field. In a volcanic deposit near Crater Lake, Oregon, they hit pay dirt.

Back in the lab, the researchers incubated the pathogens Escherichia coli and Staphylococcus epidermidis, which breeds skin infections, with clays from different zones of the Oregon deposit.

They found that the clays' rapid uptake of iron impaired bacterial metabolism. Cells were flooded with excess iron, which overwhelmed iron storage proteins and killed the bacteria.

"The ability of antibacterial clays to buffer pH also appears key to their healing potential and viability as alternatives to conventional antibiotics," state the scientists in a paper recently published in the journal Environmental Geochemistry and Health.

"Minerals have long had a role in non-traditional medicine," says Enriqueta Barrera, a program director in the National Science Foundation's (NSF) Division of Earth Sciences, which funded the research.

"Yet there is often no understanding of the reaction between the minerals and the human body or agents that cause illness. This research explains the mechanism by which clay minerals interfere with the functioning of pathogenic bacteria. The results have the potential to lead to the wide use of clays in the pharmaceutical industry."

Ancient remedies new again

Clay minerals, says Williams, have been sought for medicinal purposes for millennia.

Studies of French clays--green clays historically used in France in mineral baths--show that the clays have antibacterial properties. French green clays have been used to treat Mycobacterium ulcerans, the pathogen that causes Buruli ulcers.

Common in Africa, Buruli ulcers start as painful skin swellings. Then infection leads to the destruction of skin and large, open ulcers on arms or legs.

Delayed treatment--or treatment that doesn't work--may cause irreversible deformities, restriction of joint movement, widespread skin lesions, and sometimes life-threatening secondary infections.

Treatment with daily applications of green clay poultices healed the infections. "These clays," says Williams, "demonstrated a unique ability to kill bacteria while promoting skin cell growth."

Unfortunately, the original French green clays were depleted. Later testing of newer samples didn't show the same results.

Research on French green clays, however, spurred testing of other clays with likely antibacterial properties.

"To date," says Williams, "the most effective antibacterial clays are those from the Oregon deposit."

Samples from an area mined by Oregon Mineral Technologies (OMT) proved active against a broad spectrum of bacteria, including methicillin-resistant S. aureus (MRSA) and extended-spectrum beta-lactamase-resistant E. coli (ESBL).

What's in those rocks?

Understanding the geologic environment that produces antibacterial minerals is important for identifying other promising locations, says Williams, "and for evaluating specific deposits with bactericidal activity."

The OMT deposit was formed near volcanoes active over tens to hundreds of thousands of years. The Crater Lake region is blanketed with ash deposits from such volcanoes.

OMT clays may be 20 to 30 million years old. They were "born" eons before deposits from volcanoes such as Mt. Mazama, which erupted 7,700 years ago to form the Crater Lake caldera.

Volcanic eruptions over the past 70,000 or so years produced silica-rich magmas and hydrothermal waters that may have contributed to the Oregon deposit's antibacterial properties.

To find out, Williams and Morrison took samples from the main OMT open pit. Four types of rocks were collected: two blue clays, and one white and one red "alteration zone" rock from the upper part of the deposit.

Blue clay to the rescue

The OMT blue samples were strongly bactericidal against E. coli and S. epidermidis. The OMT white sample reduced the population of E. coli and S. epidermidis by 56 percent and 29 percent, respectively, but the red sample didn't show an antibacterial effect.

"We can use this information to propose the medicinal application of certain natural clays, especially in wound healing," says Williams.

Chronic, non-healing wounds, adds Morrison, are usually more alkaline (vs. acidic) than healthy skin. The pH of normal skin is slightly acidic, which keeps numbers of bacteria low.

"Antibacterial clays can buffer wounds to a low [more acidic] pH," says Williams, like other accepted chronic wound treatments, such as acidified nitrate. "The clays may shift the wound environment to a pH range that favors healing, while killing invading bacteria."

The Oregon clays could lead to the discovery of new antibacterial mechanisms, she says, "which would benefit the health care industry and people in developing nations. A low-cost topical antibacterial agent is quickly needed."

Answers to Buruli ulcers, MRSA and other antibiotic-resistant infections may lie not in a high-tech lab, but in ancient rocks forged in a hot zone: Oregon's once--and perhaps future--volcanoes.

-- Cheryl Dybas, NSF
Investigators
Lynda Williams
Related Institutions/Organizations
Arizona State University

SECRETARY KERRY'S REMARKS ON CRASH OF MALAYSIA AIRLINES MH17

FROM:  U.S. STATE DEPARTMENT 

Crash of Malaysia Airlines Flight MH17 in Eastern Ukraine

Press Statement

John Kerry

Secretary of State

Washington, DC

July 17, 2014

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We are horrified by the crash of Malaysia Airlines flight MH17. There are no words adequate to express our condolences to the families of the nearly 300 victims. We offer our sympathies and support to the Governments of Malaysia and the Netherlands at this difficult time, as well as to all those whose citizens may have been on board. We are reviewing whether any American citizens were aboard the flight. The United States Government remains prepared to assist with a credible, international investigation any way we can, and we will continue to be in touch with all relevant partners as we seek the facts of what happened today.

COUNTERFEIT DRUG SMUGGLER SENTENCED TO 41 MONTHS IN PRISON

FROM:  U.S. JUSTICE DEPARTMENT 

Thursday, July 17, 2014

Illinois Man Sentenced for Smuggling Counterfeit Goods and Drugs into the U.S.

An Illinois man, who previously pleaded guilty to trafficking in counterfeit goods and introducing counterfeit drugs into interstate commerce in violation of the Food, Drug and Cosmetic Act, was sentenced today to serve 41 months in prison.

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Kenneth Magidson for the Southern District of Texas and Special Agent in Charge Brian Moskowitz of Homeland Security Investigations (HSI) made the announcement.

Fayez Al-Jabri, 45, of Chicago, Illinois, was sentenced by U.S. District Court Judge Nancy F. Atlas in the Southern District of Texas.  In addition to his prison term, Al-Jabri will serve three years of supervised release and ordered to pay $15,066 in restitution and forfeit $47,750.

According to court documents, Al-Jabri conspired to smuggle more than 26,000 counterfeit Viagra tablets from China into the United States for further distribution.   As part of that conspiracy, between July 2011 and October 2012, Al-Jabri and his co-conspirator shipped thousands of counterfeit Viagra tablets from Chicago to an undercover agent in Houston, Texas.  HSI submitted all of the tablets seized during the investigation to both the U.S. Food and Drug Administration (FDA) and Pfizer, Viagra’s manufacturer, for analysis.  Both the FDA and Pfizer identified the tablets as counterfeit and misbranded Viagra.

Al-Jabri and Jamal Khattab, 49, of Katy, Texas, were indicted on Aug. 22, 2012.  On March 21, 2014, Al-Jabri pleaded guilty to one count of conspiracy to traffic in counterfeit goods, to introduce misbranded prescription drugs into interstate commerce and to import such goods contrary to U.S. law; one count of trafficking in counterfeit goods; and one count of introducing counterfeit drugs into interstate commerce in violation of the Food, Drug and Cosmetic Act.   Khattab pleaded guilty on Dec. 3, 2013, to the same charges, and his sentencing is scheduled for Aug. 14, 2014.

This matter was investigated by HSI, the FDA’s Office of Criminal Investigations, the Department of State - Diplomatic Security Service and police departments in Houston and Chicago.  The case is being prosecuted by Assistant Deputy Chief for Litigation John H. Zacharia of the Criminal Division’s Computer Crime and Intellectual Property Section and Assistant U.S. Attorneys Kebharu Smith and Jennifer Lowery of the Southern District of Texas.

U.S. DEFENSE DEPARTMENT CONTRACTS FOR JULY 17, 2014

FROM:  U.D. DEFENSE DEPARTMENT 

CONTRACTS

NAVY

Insight Pacific LLC,* Anaheim, California (N62478-14-D-4000); Bethel-Webcor JV-1,* Anchorage, Alaska (N62478-14-D-4001); Dawson-Hawaiian Builders I,* Honolulu, Hawaii (N62478-14-D-4002); JSR-ECC LLC,* Schertz, Texas (N62478-14-D-4003); CT JV,* Bargerville, Indiana (N62478-14-D-4004); and Environet Inc.,* Kamuela, Hawaii (N62478-14-D-4005) are being awarded an indefinite-delivery/indefinite-quantity multiple award design-build/design-bid-build construction contract for construction projects located primarily within the Naval Facilities Engineering Command Hawaii area of responsibility. The maximum dollar value including the base period and four option years for all six contracts combined is $240,000,000. The work to be performed provides for but is not limited to labor, supervision, tools, materials and equipment necessary to perform new construction, repair, alteration, and related demolition of existing infrastructure based on design-build or design-bid-build (full plans and specifications) for infrastructure within the state of Hawaii. No task orders are being issued at this time. Work will be performed at various Navy, Marine Corps, Air Force, and miscellaneous federal and other facilities in the NAVFAC Hawaii area of responsibility. The term of the contract is not to exceed 60 months, with expected completion date of July 2015 (base period). Navy working capital funds in the amount of $60,000 are being obligated on this award and will not expire at the end of the current fiscal year. This contract was competitively procured via the Navy Electronic Commerce Online website, with 22 proposals received. These six contractors may compete for task orders under the terms and conditions of the awarded contracts. The Naval Facilities Engineering Command, Pearl Harbor, Hawaii, is the contracting activity.

Geographic Information Services Inc., Birmingham, Alabama, was awarded a $29,884,815 firm-fixed-priced, indefinite-quantity/indefinite-delivery contract to provide software maintenance, database development, engineering support, integration services, and training for foreign military sales purchasers to use the Weapon Danger Zone Tool. Work will be performed in Birmingham, Alabama, and is expected to be completed by July 1, 2017. This contract will be funded with foreign military sales funds. No contract funds will expire by the end of the current fiscal year. No funds were obligated at the time of award. Funds will become available on individual task orders. This contract was competitively procured via the Federal Business Opportunities website with two offers received. The Marine Corps Systems Command, Quantico, Virginia, is the contracting activity (M67854-14-D-9501). (This contract was awarded on July 2, 2014.)

EDO Professional Services Inc., Alexandria, Virginia, is being awarded $24,864,130 for one-year modification (P00012) to a previously awarded indefinite-delivery/indefinite-quantity, cost-plus-fixed-fee contract (N66001-09-D-0032) for continued technical services in support of Space and Naval Warfare Systems Center Pacific unmanned maritime systems. An accelerated timeline and increased operational requirements for unmanned maritime systems performing fleet mine countermeasures and force protection necessitated this modification to increase the cost ceiling. EDO Professional Services Inc., will provide engineering, logistics, configuration management, research, depot maintenance, system administration, and tactical and strategic management. Work will be performed in Manama, Bahrain (65 percent) and San Diego, California (35 percent), and is expected to be completed by July 21, 2015. No funds will be obligated at the time of award. Fiscal 2014 and 2015 operations and maintenance, (Navy) and research, development, test and evaluation funds will be incrementally obligated at the task order level. Fiscal 2014 operations and maintenance, (Navy) funds in the amount of $16,000,000 will expire at the end of the current fiscal year. This is a modification to a contract competitively procured via Space and Naval Warfare Systems Center Pacific solicitation N66001-09-R-0032 and published on the Federal Business Opportunities website, with one offer received. Space and Naval Warfare Systems Center Pacific, San Diego, California, is the contracting activity.

Huntington Ingalls Inc., Ingalls Shipbuilding, Pascagoula, Mississippi, is being awarded a $23,499,948 modification to previously awarded contract (N00024-13-C-2402) for early industry involvement associated with the LHA(R) Program Flight 1 (LHA 8) ship design to initiate an affordability design phase. The early industry involvement contracts were awarded to U.S. shipyards that have the facilities and resources to build a large deck amphibious assault ship without major re-capitalization. Work will be performed in Pascagoula, Mississippi, and is expected to be completed by May 2015. Fiscal 2014 research, development, test & evaluation contract funds in the amount of $19,740,760 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.
BAE Systems San Diego Ship Repair, San Diego, California, is being awarded a $15,178,728 modification to previously awarded cost-plus-award-fee contract (N00024-10-C-4407) for USS New Orleans (LPD 18) fiscal 2014 selected restricted availability (SRA). An SRA includes the planning and execution of depot-level maintenance, alterations, and modifications that will update and improve the ship's military and technical capabilities. Work will be performed in San Diego, California, and is expected to be completed by December 2014. Fiscal 2014 operations and maintenance (Navy) and fiscal 2014 other procurement (Navy) funding in the amount of $15,178,728 will be obligated at the time of award. Contract funds in the amount of $14,689,549 will expire at the end of the current fiscal year. The Southwest Regional Maintenance Center, San Diego, California, is the contracting activity.

ARMY

General Dynamics Land Systems, Sterling Heights, Michigan, was awarded a $65,256,769 modification (P00010) to foreign military sales contract W56HZV-13-D-0015 for specialized training, contractor logistics support, and base life support for the Iraq M1A1 Abrams program. Funding and work location will be determined with each order. Estimated completion date is Feb. 28, 2015. Army Contracting Command, Warren, Michigan, is the contracting activity.
Kongsberg Defence & Aerospace, Kongsberg, Norway, was awarded a $43,000,000 modification (P00115) to contract W15QKN-12-C-0103 for depot support for the Common Remotely Operated Weapon Station. Fiscal 2014 operations and maintenance (Army) funds in the amount of $43,000,000 were obligated at the time of the award. Estimated completion date is July 15, 2016. Work will be performed in Johnstown, Pennsylvania. Army Contracting Command, Picatinny Arsenal, New Jersey, is the contracting activity.
Watts Constructors LLC, Honolulu, Hawaii, was awarded a $36,441,000 firm-fixed-price contract with options for designing and building the Special Operations Forces Battalion Operations Facility Complex. Work will be performed at Fort Carson, Colorado, with an estimated completion date of June 15, 2016. Bids were solicited via the Internet with fifteen received. Fiscal 2013 military construction funds in the amount of $36,441,000 are being obligated at the time of the award. U.S. Army Corps of Engineers, Omaha, Nebraska, is the contracting activity (W9128F-14-C-0024).

Walsh Federal JV St., Chicago, Illinois, was awarded a $34,748,000 firm-fixed-price multi-year contract with options for new construction for the Marshall Elementary School at Fort Campbell, Kentucky. Work will be performed at Ft. Campbell, Kentucky, with an estimated completion date of April 1, 2016. Bids were solicited via the Internet with five received. Fiscal 2014 military construction funds in the amount of $34,748,000 are being obligated at the time of the award. U.S. Army Corps of Engineers, Louisville, Kentucky, is the contracting activity (W912QR-14-C-0025).

AAR Allen Services, Garden City, New York, was awarded a $23,507,990 firm-fixed-price contract for 60-520 gas turbine power units for the Blackhawk weapon system. Funding and work location will be determined with each order with an estimated completion date of July 30, 2019. Bids were solicited via the Internet with four received. Army Contracting Command, Redstone Arsenal, Alabama, is the contracting activity (W58RGZ-14-D-0089).

Aerojet Rocketdyne, Camden, Arizona, was awarded an $18,507,839 firm fixed-price contract with options for Stinger flight motors, 1,000 each. Base Option: Stinger flight motors, 1-1,500 each. Option 1: Stinger flight motors, 1-505 each. Option 2: Stinger flight motors, 1-545 each. The Stinger flight motor contract is required to support the Service Life Extension Program (SLEP) of 850 Stinger Block I Missiles at McAlester Army Ammunition Plant, McAlester, Oklahoma. The SLEP will replace all Stinger missile components susceptible to degradation due to aging (to include the flight motor) providing a missile with a 10 year shelf life. Work will be performed in Camden, Arizona, with an estimated completion date of Dec. 31, 2016. One bid was solicited with one received. Fiscal 2014 other procurement funds in the amount of $18,507,839 are being obligated at the time of the award. Army Contracting Command, Redstone Arsenal, Alabama, is the contracting activity (W31P4Q-14-C-0090).

Northrop Grumman Technical Services Inc., Herndon, Virginia, was awarded a $9,859,646 modification (P00002) to contract W9124E-14-C-0003 to continue key and essential logistics requirements at the Joint Readiness Training Center and Fort Polk, Louisiana. Fiscal 2014 operations and maintenance (Army) funds in the amount of $9,859,646 were obligated at the time of the award. Estimated completion date is Dec. 29, 2014. Work will be performed at Fort Polk, Louisiana. Army Contracting Command, Fort Polk, Louisiana, is the contracting activity.

Intelligent Decisions Inc., Ashburn, Virginia, was awarded an $8,569,058 firm-fixed-price contract with options for information technology operations and maintenance support for U.S. Southern Command Joint Task Force-Guantanamo Bay. Work will be performed in Cuba with an estimated completion date of July 22, 1019. Bids were solicited via the Internet with 13 received. Fiscal 2014 operations and maintenance (Army) funds in the amount of $7,969,059 are being obligated at the time of the award. Army Contracting Command, Fort Sam Houston, San Antonio, Texas, is the contracting activity (W912CL-14-C-0018).

AIR FORCE

Northrop Grumman Systems Corp., Information Systems Sector, Defense Systems Division, C2S, Herndon, Virginia, has been awarded a $9,922,486 modification (P00020) to cost-pl
us-fixed-fee FA8750-13-C-0120 for software enhancements, testing, integration and maintenance. The contract modification is to provide support to the National Air and Space Intelligence Center to operate, maintain, and enhance the databases, tools, dynamic web-based products, and related systems and capabilities. Work will be performed at Beavercreek, Ohio, and is expected to be completed by June 12, 2015. Fiscal 2014 operations and maintenance funds in the amount of $6,439,147 are being obligated at the time of the award. Air Force Research Laboratory/RIKE, Rome, New York, is the contracting activity.

Vision Systems International LLC, Fort Worth, Texas, has been awarded a $7,768,862 firm-fixed-price task order (0024) to FA8522-09-D-0012 for F-15 and F-16 sustainment in support of the Joint Helmet Mounted Cueing System. Work will be performed at Wilsonville, Oregon, and is expected to be completed by July 15, 2015. This award is the result of a sole source acquisition. Funds in the amount of $7,768,862 from Fiscal 2014 Consolidated Sustainment Activity Group Working Capital Funds under the Fiscal 2014 Contract Depot Maintenance Direct Cite Funds Program Authority are being obligated at time of award. This contract is not multiyear. Air Force Sustainment Center, Robins Air Force Base, Georgia, is the contracting activity.

DEFENSE LOGISTICS AGENCY

CORRECTION: The contract announced on July 14, 2014, for AvKare Inc.,** Pulaski, Tennessee (SPE2D2-14-D-0004), for $9,728,923 was announced with an incorrect award date. The correct award date is July 17, 2014.

*Small Business

**In HubZone Service Disabled Veteran Owned Small Business

PRESIDENT OBAMA ORDERS NEW SANCTIONS AGAINST RUSSIAN INTERESTS

OBAMA-PUTIN CALL MENTIONS DOWNED PASSENGER JET NEAR RUSSIA-UKRAINE BORDER

FROM:  THE WHITE HOUSE 

Readout of the President’s Call with President Putin of Russia

President Obama spoke with Russian President Putin today about the situation in Ukraine and the additional sanctions on Russian individuals and entities that the United States announced on July 16.  President Obama emphasized that he remains committed to a diplomatic solution and that sanctions were not his preferred course of action.  President Obama noted, however, that in the face of extensive evidence that Russia is significantly increasing the provision of heavy weapons to separatists in Ukraine and Russia’s failure to take other steps set out by the United States and Europe to de-escalate the crisis, it was necessary to impose additional sanctions, consistent with the clear statements from the United States and our allies following the G-7 meeting in Brussels.  President Obama also reiterated his concerns regarding the buildup of Russian forces near the Ukrainian border.  President Obama called on President Putin to take concrete steps to de-escalate the situation, including to press separatists to agree to a cease-fire, support a roadmap for negotiations, halt the flow of fighters and weapons into Ukraine, obtain the release of all hostages still held by the separatists, and work to establish an effective OSCE border-monitoring mechanism.  He noted that Russia would face continued costs and isolation unless it takes these concrete steps.  The President emphasized that Russia and the United States have a shared interest in supporting a stable and prosperous Ukraine.  President Obama and President Putin agreed on the need for a peaceful resolution to the Ukraine crisis achieved through diplomatic means.  During the call, President Putin noted the early reports of a downed passenger jet near the Russia-Ukraine border.

The President Meets with His Climate Task Force