Layoffs tied to helicopter are mounting

Pentagon canceled work on VH-71

Friday, Aug. 7, 2009

See related stories

More news of local job losses tied to the cancellation of the presidential helicopter program continues to trickle in.

On Tuesday, 10 St. Mary's employees of Bell Helicopter Co. were notified that they were being laid off. They are in addition to the 70 Bell employees who learned in early June that they were losing their jobs because of the termination of the VH-71 program.

"We had about 90 employees at the VH-71 program at Pax River," said Tom Dolney, manager of military communications at the company headquarters in Ft. Worth, Texas.

Dolney said the company reassigned about 10 of those employees to other jobs within the company. Bell Helicopter was a subcontractor to AgustaWestlandBell on the VH-71 program.

Daniel Hill, vice president for external affairs at AgustaWestland in Reston, Va., confirmed on Wednesday that 20 employees of AgustaWestlandBell in Lexington Park were laid off in early June because of the cancellation of the program.

"We are looking at other cuts to see if any need to be made," Hill said Wednesday.

"We will be working through that over the next weeks and months." Hill said there were approximately 120 employees of AgustaWestlandBell working on the VH-71.

"We have also had layoffs in Reston, all related to this program," Hill said. "Some employees left because of attrition and we have moved some employees around. Obviously, we had a hiring plan in place and we are not going to be able to go through with it."

Karen Metz was one of the local residents affected by the shutdown of the program.

Metz, a systems engineer, said employees of AgustaWestlandBell were aware that the program might end.

"We suspected it was coming when Obama said he did not want a [new] helicopter," Metz said in a telephone interview. "Most of us knew it was coming."

Hill declined to elaborate on company benefits that are provided to laid-off employees, but said, "There is a package that employees are given. We do what we can to take care of our employees and we are obviously very sad at this development."

According to Dolney, Bell employees who are laid off from the VH-71 program will receive 60 days of severance pay and a two-day outplacement seminar which will be customized to these employees.

Dolney said benefits, which include medical insurance, run to the end of the month in which the termination becomes effective, meaning if an employee was notified Tuesday, the 60 days of severance pay would end on Oct. 4, but benefits would continue until the end of October.

After the benefits end, he said, employees would be eligible for 18 months of COBRA. COBRA, the Consolidated Omnibus Budget Reconciliation Act, provides certain former employees, retirees, spouses, former spouses and dependent children the right to purchase temporary continuation of health coverage at group rates.

Thirty local workers at Pax River were among the 600 or more employees laid off by Lockheed Martin Corp., the prime contractor. Those jobs also ended because of the government's decision to end the VH-71 presidential helicopter program.

The initial VH-71 program was divided into two phases, or increments. Increment 1 was to provide five helicopters by September 2010. Increment 2 was to provide 23 more helicopters with more advanced technology by 2017. Cost overruns from additional requirements became a huge issue for the program, which was initially intended to cost $6.5 billion.

The U.S. Navy announced on June 1 that it was ending the $13.5 billion contract to build the helicopter.

The Obama administration requested $85 million in its 2010 Defense Department budget proposal to shut down the program and to look at other aircraft to replace the current presidential helicopter fleet.

Last week, the U.S. House of Representatives passed a $636 billion defense spending bill by a vote of 400-30.

Included in this bill was $485 million, or $400 million more than was requested, to make five of the VH-71s operational. All of Maryland's congressional representatives voted in favor of this bill. The bill has been referred to the Senate Appropriations Committee where a vote is expected after Sept. 8 when Congress returns from its summer recess.