Military services competing for future airlift missions.

A multibillion-dollar program to equip the Army National Guard with new fixed-wing cargo aircraft fleet has rekindled a turf battle between the services that was supposed to have been settled more than half a century ago.

At issue is the Army's "future cargo aircraft" that will replace the aging fleet of C-23 Sherpas. Although the Army so far has committed to buying 33, it could eventually acquire as many as 120. Competing for the award are Global Military Aircraft Systems, with the C-27J Spartan, and the Raytheon Company, which is proposing the CASA C-295 aircraft.

A procurement this large has raised eyebrows in the U.S. Air Force, which was put in charge of airlift operations under a 1948 agreement, known as "Functions of the Armed Forces and the Joint Chiefs of Staff"--also informally dubbed the "Key West Agreement" because it was signed in Key West, Fla., at a military summit convened to settle service differences over roles and missions left unclear by the National Security Act of 1947.

The Army, nonetheless, has made a strong case for operating its own airlift fleet. The Sherpas not only are aging, but they also are too small and must fly at low altitudes because they lack pressurized cabins, which makes them vulnerable to surface-to-air missiles, Army officials said. Throughout the Iraq war, the Sherpa has served as a primary transport of cargo and passengers, which bolsters the Army's claim that it needs its own light cargo planes.

The Air Force, for its part, has hinted for years that it wants to buy a light cargo aircraft, to supplement the C-17 and C-5 heavy lift, and the C-130 medium lift transports. But the service has not yet funded the program.

Last month, Gen. Michael Moseley, chief of staff of the Air Force, told the annual convention of the Air Force Association that the service intends to procure a light cargo aircraft.

Operations in Afghanistan and Iraq proved that there is "some utility" in having an aircraft that can take off and land in a 2,000 to 2,500 foot runway, can carry two pallets and 25 to 30 people, said Moseley. "Something like that would be useful in the Gulf Coast" for hurricane relief operations, he added.

Gen. Ronald Keys, commander of the Air Combat Command, hinted that the ideal solution would be a "two-engine version of the C-130." Whether that comment implied an endorsement of the C-27J is not clear, and Air Force officials have stressed that no buying decisions are likely to be made any time soon.

The service has tried in recent weeks to squash speculation that the Air Force would prefer the C-27J over the C-295. "The Air Force is participating in the joint-led intra theater lift capability study, which will be completed in two phases," said spokesman Doug Karas. "Phase 1 will look at intra theater lift requirements through the 2012 time frame, and Phase 2 will evaluate the period from 2015-2025." This study and other internal analysis will shape any future decision to acquire a light cargo aircraft, Karas noted.

The study is not likely to get under way, however, until a Joint Staff panel in charge of overseeing the effort is assured that the Air Force identified funds in its future budgets to pay for the light cargo aircraft, said a Defense Department source.

Officials in charge of the Army Future Cargo Air Aircraft program insisted that the Air Force has not participated in any procurement decisions. "From where I sit, in Huntsville, Aid., the Air Force has not played heavily in what we are doing in the acquisition," said Army Brig. Gen. James H. Pillsbury, head of the U.S. Army Aviation and Missile Command.

The Air Force, however, did work with the Army in setting performance goals for the aircraft, said Brig. Gen. E.J. Sinclair, commander of the U.S. Army Aviation Center. "We worked very closely with the Air Force to develop the requirements of FCA," he told reporters. "I'm not sure what the Air Force is working on for light aircraft, but our requirements primarily were to replace the Sherpas and improve responsiveness on the battlefield."

Sinclair stressed that the Army so far is buying 33, but the number could change in the future. "Future requirements are still under analysis," he said.

While the military services sort out these issues, both industry bidders remain engaged in a marketing war.

Raytheon officials maintain that while the company is positioning the C-295 transport as a Sherpa replacement for the Army, it also expects the aircraft to meet the Air Force's requirements.

The Air Force has not yet firmed up the specifications and technical requirements for a new light cargo aircraft, so it would be unfair to conclude that any officials have made up their minds about what aircraft the service should buy, said Jim Hvizd, president of Raytheon's future cargo aircraft team.

Hvizd contended that the C-295 is more suitable than the C-27J because it is 13,000 pounds lighter and has been bought by military forces in 25 countries. The C-27J, by comparison, "doesn't exist in anyone's inventory," said Hvizd.

Enrique Briz, a spokesman for Global Military Aircraft Systems, countered that 32 C-27Js have been ordered by Greece, Italy and Bulgaria, and the aircraft already is in operation by the Hellenic Air Force. "More C-27Js have been sold and are in production than C-295s," said Briz.

No matter which of the two competitors the Army selects next summer, the Air Force will be under pressure to begin funding a light cargo aircraft, industry sources said. Although both services have made a case for buying a light transport, even if they agree on acquiring a common aircraft, each would have to pay for its own.

One industry source cited a "gentleman's agreement" between Army Chief of Staff Gen. Peter J. Schoomaker and former Air Force Chief Gen. John Jumper that committed the Army to let the Air Force take over the program if the fleet gets larger than 50 aircraft.

It is not clear whether Jumper's successor, Moseley, has been asked to keep that agreement. Further, many of these decisions also are tied to the outcome of next year's Quadrennial Defense Review, which is expected to call for a reallocation of resources among the services.

"If the Army gets a larger share of the money, it can secure the future cargo aircraft, while the Air Force would be left scrambling" and likely would blame the Army for violating the Key West agreement, said the industry source. "It's a 'roles and missions' issue that is upsetting the Air Force ... as it sees how much traction this program is getting."

To protect itself from potential Air Force inroads, the Army carefully worded its request for industry bids as a "Sherpa replacement." The initial buy is for 22 aircraft, with options for 11 more. If the Defense Department gives the Army a green light to continue the program beyond the first 33, the Army would continue to buy 11 per year. "As long as it stays as a C-23 replacement, they can continue to buy small orders," the industry source said.

At the National Guard annual convention in Hawaii, in mid-September, some Air Guard attendees grumbled that they too should have a light cargo aircraft like the Army National Guard, the source added.

Air National Guard Brig. Gen. Duane Lodrige said the Air Guard would be a "key player" in any future light cargo aircraft program. It's become dear that the C-130 is too big for many of today's Guard duties, such as shuttling cargo and troops in Iraq, or providing humanitarian relief, he said.

For homeland defense missions, the Air Guard would propose basing a fleet of eight to 12 light cargo aircraft at each of the nation's 10 Federal Emergency Management Agency regions.

A light cargo plane, said Lodrige, is a "good fit for the Guard as a first responder."