LAAS developer Honeywell and FAA LAAS program officials remain tight lipped about how the contract, awarded in April on the understanding that the system’s development was 80-percent complete, had by September reversed itself to becoming only 20-percent complete.

FAA insiders have informed AIN that in fall 2002, FAA Administrator Marion Blakey was asked to approve the award to Honeywell of the final LAAS development contract–for which two other developers had competed–but that she had refused to do so until she could be assured that the long-troubled program was now risk free. Agency officials reportedly then launched a six-month due-diligence investigation which, by last April, gave Honeywell’s project a clean bill of health, along with the assertion that only 20 percent of the development work remained.

Blakey then signed off on the contract award, but AIN was told that within less than two months FAA officials began to realize that their due-diligence investigation had not been as thorough as it might have been, and by late summer it had become clear that the 80-percent completion status that was reported to Blakey was actually only 20 percent.

Insiders now tell AIN that Honeywell has offered the agency a “get well” plan with a $10 million price tag attached. It is unclear whether the agency will swallow this medicine. However, AIN learned that the FAA has now established a team that will attempt to determine what went wrong, and whether the Honeywell project should remain on life support or be allowed to die. Meanwhile, it is reported that Blakey is not amused, and insiders speculate that this could be an interesting application of the new Administration’s policy of individual accountability in agency affairs.