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Newsday February 21, 2006

Northrop vying for $2.5B contract

By James Bernstein

Northrop Grumman Corp. and General Dynamics Corp. are competing for what will be one of the largest homeland security contracts ever: a $2.5-billion award to design sensors and other devices to catch illegal immigrants, drug smugglers or terrorists who slip across U.S. borders, company officials have said.

The U.S. Department of Homeland Security said it will begin soliciting bids as early as next month for what it calls its Secure Border Initiative Net, which includes a system of sensors and radars that would be strategically placed along Mexican and Canadian borders.

Los Angeles-based Northrop Grumman employs about 2,600 people at a facility in Bethpage whose work primarily involves designing radar and sensor devices for Navy airplanes. The Bethpage facility also is engaged in homeland security work, but company officials were unable to say where work on the border-security equipment would be done.

Homeland Security officials said the border contract could be awarded as early as September.

Bob Gearhart, Northrop Grumman's director of homeland security and homeland defense, who is based in Bethpage, said last week that the company has been studying the border project for several years.

"This has been a full company approach," Gearhart said. "All of the ... [company's divisions] have been working on it.

"We look at this as a large integration project. We've done that for 50 years on Long Island, integrating things" such as airplanes and electronic systems.

Gearhart said that if Northrop Grumman wins the contract, it will add more employees, but he was unable to say how many.

Other major defense contractors, including Lockheed Martin Corp., Textron Inc. and Raytheon Co., have told analysts they also may be interested in bidding but have not officially announced their intentions.

The Bush administration is seeking more advanced technology to secure its borders, particularly with Mexico. U.S. officials have said that more than a million illegal immigrants were arrested in the United States last year, many from Mexico. Government funding for homeland security is soaring.

The administration last week asked Congress to approve $42.7 billion for homeland security in fiscal 2007, which begins Oct. 1. That is a 6 percent increase from this year. Analysts have said that spending for homeland security will rise faster than weapons programs once the Iraq war winds down.

Analysts believe Northrop Grumman may have an edge in the competition against Virginia-based General Dynamics. Northrop Grumman is the builder of Global Hawk, an unmanned spy plane used in Iraq and Afghanistan. The company also provides emergency management systems that handle 25 percent of the 911 calls in the United States.

"When I think of a surveillance company, I tend to think of Northrop Grumman rather than General Dynamics," said John Pike, director of Globalsecurity.org, a Washington, D.C.-based organization that tracks military spending.


Copyright 2006, Newsday Inc.