WASHINGTON–The Department of Defense today issued a stop-work order on production of the Joint Strike Fighter’s alternate engine, knocking out the rival to Connecticut-based Pratt & Whitney, which makes the military fighter plane’s main engine.

But even as Connecticut lawmakers applauded the Pentagon’s move, GE and Rolls Royce, which are developing the alternate engine, vowed to self-fund the project while they also appeal to Congress to overturn DOD’s decision.

The latest tussle centers on a three-paragraph announcement issued by the Pentagon Thursday.

“The Department of Defense today issued a stop work order in connection with the Joint Strike Fighter extra engine program,” the statement reads.

The order essentially requires GE and Rolls Royce to put the development of the extra engine on “pause” for 90 days, while policymakers decide whether to terminate the program or rev it back up. The program currently costs DOD $1 million per day to keep the second engine in development. A DOD spokeswoman said the government will still be liable for some costs associated with keeping the program in this limbo mode, while a final decision is reached.

The DOD announcement notes that the House recently voted to kill the program by stripping $450 million in funding from the 2011 fiscal year spending bill.

While that measure has not become law, the House vote was a surprising blow to GE and Rolls Royce’s efforts to keep the program alive. The Senate has in previous years voted to nix the second engine.

“In light of these recent events, Congressional prerogatives, and the administration’s view of the program, we have concluded that a stop work order is now the correct course,” DOD said. “The stop work order will remain in place pending final resolution of the program’s future, for a period not to exceed 90 days, unless extended by agreement of the government and the contractor.”

Connecticut’s federal representatives cheered DOD’s move.

“The shutdown of work on the extra engine should close the book on this hard fought battle,” said Rep. Joe Courtney, a 2nd District Democrat who sits on the House Armed Services Committee.

“Today’s decision will save the American people nearly a million dollars a day and bring to close an issue that has been debated in Congress for more than 4 years,” said Rep. John Larson, D-1st District, who helped round up Democratic votes to strip the $450 million during the February House vote. After that win, Larson and Sen. Joseph Lieberman, an independent, asked Defense Secretary Robert Gates to use his authority to kill the program–a move Gates previously said he wanted to take.

But Courtney and others conceded the the stop-work order would probably not end the years-long legislative battle over funding the second engine. And a GE spokesman said the company planned a multi-pronged effort to keep the alternate engine program alive.

“We are not deterred by this decision,” GE said in a statement. “We feel so strongly about this issue, as do our Congressional supporters, that we will, consistent with the stop work directive, self-fund the F136 program through this 90-day stop work period.”

GE said it has “no intention of abandoning” the project. “We will not walk away from a $3 billion taxpayer investment.”

Rick Kennedy, a company spokesman, said GE’s pledge to continue work on the engine won’t cost nearly as much as the government has been paying for development and testing, although he didn’t provide a specific dollar figure.

“We have recently completed two key phases in the engine testing and aren’t planning to run additional engines for a few weeks anyway,” Kennedy said. “So the work over the next three or four weeks will fundamentally be design work. We’ll have to pull back on engine testing during this period.”

In the meantime, GE and Rolls Royce will continue to press their case in Congress for continued funding of the program.

“Everyone knows competition saves money,” GE said in its statement. “Our supporters in Congress are more determined than ever, and are encouraging us to press the merits of our case.” GE argues that the F136 engine “is meeting or exceeding performance expectations,” and has advantages over the Pratt & Whitney engine.

Pratt and its parent company, United Technologies Corp., have long countered that the main engine is superior and that the second engine is a waste of scarce federal dollars.

DOD and the White House share that assessment. “In our view it is a waste of taxpayer money that can be used to fund higher Departmental priorities, and should be ended now,” DOD said.

Courtney, Larson and others promised to press for a final legislative resolution as Congress continues its work on a 2011 funding bill. So far, lawmakers have been unable to come to an agreement about how to fund the government for the rest of 2011.

That leaves open the possibility that the F136 funds could be restored, although the House vote indicates that GE and Rolls Royce will have an uphill fight.

Asked how they could expect to get the second engine money restored when the House and Senate are both on record against it, Kennedy noted that both the House bill and a competing Senate version were dead. And any final agreement will have to be reconciled by a House-Senate conference committee made up of top congressional negotiators.

“We have significant support in the conference,” Kennedy said.

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