WASHINGTON (Aug. 12)
Israel’s controversial Lavi jet fighter received a financial boost Monday when the Defense Department announced it would release $67 million it had held up for contracts involving the plane.
All Lavi funding requests will be processed while the Pentagon studies alternatives for reducing the cost of producing the plane, according to spokesman Maj. Larry Icenogle.
Results of the study will be reviewed with Israel, he added, citing a letter from Defense Secretary Caspar Weinberger to a group of Congressmen who protested in a July 17 letter the delay in funds.
The Pentagon estimates the cost of building each plane at $22 million, while Israel predicts $15 million. The plane, which was unveiled in July, is slated to replace some 300 older Israeli jets in the 1990′s.
The Pentagon had slowed approval of the contract funds following the dispute this summer over cost projections. The U.S. has underwritten most of the $1 billion development of the Lavi.