DATE: Friday, June 13, 1997                 TAG: 9706130639

SECTION: FRONT                   PAGE: A6   EDITION: FINAL 

SOURCE: BY DAVE MAYFIELD, STAFF WRITER 
                                            LENGTH:   44 lines

HOUSE, SENATE PANELS DIFFER ON PLANS THAT NEWPORT NEWS YARD IS COUNTING ON TOUGH BARGAINING APPEARS CERTAIN BEFORE MILITARY SPENDING BILLS WILL BE APPROVED.

Senate and House defense committees on Thursday took opposite stands on programs important to Newport News Shipbuilding, which could lead to bitter bargaining when military spending bills reach a conference committee that must reconcile differences.

The Senate Armed Services Committee endorsed two Navy projects advocated by the Newport News yard: an earlier-than-planned down payment toward construction of a new $5 billion-plus aircraft carrier, and a ``team building'' agreement between Newport News and General Dynamics Corp.'s Electric Boat division on the construction of four new submarines.

The House National Security Committee rejected both proposals.

Sen. John Warner, a senior Republican on the Armed Services Committee, pushed Newport News' agenda on that panel and said he was pleased with the result.

He said taxpayers would benefit from the down payment of $350 million, two years earlier than President Clinton's budget proposed, for a new carrier to be built at Newport News. By moving ahead earlier, the shipyard projects a $600 million savings over the life of the construction program, partly by avoiding the expense of having to lay off and then rehire and retrain thousands of workers who otherwise would soon run out of work.

The team-building agreement between Newport News and Electric Boat of Groton, Conn., is also being sold as a cost-saver for the Navy. Newport News has put the potential savings over the next five years at as much as $700 million.

Some senior Republicans on the House committee were doubtful about the projected savings.

Rep. Duncan Hunter, R-Calif., who chairs a key House military procurement subcommittee, has been negative toward Newport News' agenda. He is widely suspected of planning to horse-trade for votes to restore funding for the Air Force's B-2 bomber. The B-2 is important to his district.

Assuming the full House and Senate adopt their defense committees' bills, one congressional source predicted a ``colossal fight'' in the conference committee whose job it will be to iron out differences. KEYWORDS: MILITARY BUDGET

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