DATE: Friday, September 26, 1997            TAG: 9709260773

SECTION: FRONT                   PAGE: A3   EDITION: FINAL 

SOURCE: BY DALE EISMAN, STAFF WRITER 

DATELINE: WASHINGTON                        LENGTH:   58 lines

CONGRESS GIVES THUMBS UP TO SUBMARINE, CARRIER PROJECTS THE DEFENSE APPROPRIATIONS ARE CONSIDERED IMPORTANT TO NEWPORT NEWS SHIPBUILDING.

Congress gave final approval Thursday to a $248 billion defense budget for 1998 that will keep Newport News Shipbuilding in the submarine business and will allow the yard to get a modest early start on its 10th and final Nimitz-class aircraft carrier.

The legislation now will go to President Clinton, who is expected to sign it.

Approval came after less than an hour of debate in each house, most of it focusing on the future role of U.S. military forces in Bosnia. The bill calls for withdrawal from Bosnia by June 30, 1998, but gives Clinton the authority to keep troops in place if he comes to Congress by May 15 and explains why the troops are necessary there.

Clinton had threatened to veto the legislation if Congress required a Bosnia withdrawal.

The submarine and carrier projects are considered vital to Hampton Roads and particularly to Newport News Shipbuilding, which is in its first year as an independent company after being spun off by Tenneco Inc. The yard builds some commercial ships, but Navy ships remain its core business.

Newport News got everything it wanted in the submarine appropriation, as lawmakers agreed to let it join forces with a longtime rival, Electric Boat of Groton, Conn., to construct the first four subs in a new class of attack boats.

The four subs will be built over a five-year span, beginning in 1998.

The unusual arrangement calls for each yard to build different sections of each sub, with the firms alternating in taking responsibility for final assembly of the sections. The deal is supposed to reduce the cost of the four ships to $9.3 billion from $10 billion.

The Navy said the savings were critical to its ability to purchase other ships, including the 10th Nimitz-class carrier. That ship will not join the fleet until around 2008, but Newport News hoped to secure $345 million in 1998 for preliminary work.

Instead, Congress provided only $50 million. Though the sum was a disappointment to Virginia's senators and local members of Congress, they insisted the early appropriation is a signal that the ship will be fully supported when it is time for actual construction to begin.

The carrier is expected to cost around $5 billion to complete. Newport News is working on two carriers, the Harry S. Truman and the Ronald Reagan, but the Truman is expected to join the fleet sometime in 1998.

Other key portions of the bill would:

Add $720 million for a fourth DDG-51 destroyer, to be built in Pascagoula, Miss., hometown of Senate Majority Leader Trent Lott. President Clinton's original proposal called for funding for three destroyers in 1998.

Fully fund the Air Force F-22 fighter program at $2.2 billion and the Navy's F/A-18 ``Super Hornet'' at $2.19 billion. The Senate had proposed substantial cuts in the F-22, while the House wanted to spend less on the Super Hornet. KEYWORDS: DEFENSE SPENDING

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