The Israel Missile Defense Organiza tion (IMDO) is reviewing bids from two competing U.S.-Israeli industrial teams vying to develop what could become the newest layer in the nation’s multi-tiered missile defense network.

Detailed cost and technical proposals for Israel’s Short Range Ballistic Missile Defense (SRBMD) program were submitted in late February by Israel Aircraft Industries Ltd. of Lod and Haifa-based Rafael Ltd. , both government-owned firms. The former is partnered with St. Louis-based Boeing Integrated Defense Systems while Rafael is about to finalize a teaming agreement with Raytheon Co. of Waltham , Mass.

By early April, IMDO is expected to determine which of the two teams will complete an ongoing risk-reduction effort and possibly transition into a planned four- or five-year full scale development program. Israeli government and industry sources estimated SRBMD development costs at between $200 million and $300 million, and stressed that full scale development is contingent on significant funding support from the U.S. government.

So far, the Pentagon’s Missile Defense Agency is committed to supporting IMDO’s 18-month risk reduction study, which began in March 2005, through a $10 million congressional supplement awarded in the context of the joint U.S.-Israel Arrow program. As for future levels of U.S. funding, a Pentagon official said technical and economic viability will be determined at the conclusion of the risk reduction study.

“A development decision could be made by the end of the year,” the official said. He added that much will depend on initial feasibility findings and the extent to which Congress is willing to supplement the $70 million requested by the Pentagon for Arrow-related spending in 2007.

As envisioned, the SRBMD system would serve as the bottom layer of Israel’s multi-tiered active defense network, intercepting rockets and missiles whose ranges fall well below the class of Scud and Shihab threats which the U.S.-Israel Arrow was designed to destroy.

With the Arrow at the high end of the missile defense shield, the low-end SRBMD program would sandwich U.S.-supplied Hawk and Patriot Pac-2 missiles batteries now deployed by the Israel Air Force to defend against aircraft and older versions of Scud-class missiles.

Although limited in reach, the short-range missiles that the SRBMD system would counter — with ranges from 40 kilometers to about 200 kilometers — may be even more lethal than Scud-class missiles because they are cheap, plentiful, easily concealed and relatively simple to launch, sources here said.

In an interview last year, IMDO Director Arieh Herzog said the SRBMD effort would focus on what he called “the low-end class of threats” coming from Lebanon and Syria. “After extensive discussions with the Pentagon, we understand that U.S. forces have similar requirements,” Herzog said at the time.

Because IMDO is now evaluating competing industry proposals, Herzog declined a request for a follow-up interview. In his earlier interview, the IMDO chief said existing systems like the Arrow or the U.S. Patriot Pac-3 are “way too expensive” to defend against such a prolific threat , although elements of the Arrow battle management system could be adapted for the SRBMD mission.

In parallel, Israel’s Elta Systems Ltd., a subsidiary of Israel Aircraft Industries, is developing a new S-band multi-mission radar that will be optimized to provide fire control for the planned interceptors, he said.

“The [short-range missile] threat is proliferating throughout our region at a much faster pace than the classic, ‘higher-end’ missiles capable of flying 700 kilometers to more than 1,300 kilometers,” said Uzi Rubin, a former IMDO director who has long warned about the emerging threat.

According to Rubin, such missiles are becoming increasingly accurate, could be fitted with chemical or other non-conventional warheads, and can be fired in salvo fashion — similar to classic artillery rockets — at a rate of 20 rounds per minute. “These are ideal weapons for terrorist organizations and insurgency groups … and the technology is widely available to transform these marginally significant battlefield irritants into truly deadly, strategic threats,” Rubin said.

Threats to be targeted by the prospective SRBMD program include the latest Iranian-made missiles such as the 200-kilometer-range Zelzal, the 150-kilometer-range Nazeat, and versions of the Fajr series deployed by Hizbollah forces in southern Lebanon. The system also could counter Syrian variants of the Russian Frog, Syrian-built 200-millimeter rockets, the Russian Smerch multiple launch rocket system and any remnants from Iraq’s presumably destroyed arsenal of al-Sammoud and Ababil/al-Fatah missiles, whose respective ranges are 90 kilometers and 200 kilometers.

The SRBMD system would not defend against ultra-short-range missiles like the Qassem, a crude rocket routinely used by Palestinian militants to sow panic in Israeli communities bordering the Gaza Strip. According to government and industry sources here, the Research and Development Directorate of Israel’s Ministry of Defense has launched a separate effort to combat the Qassem, nearly 400 of which were launched into Israel during 2005 alone.

A senior Israel Air Force officer involved in missile defense matters said the Qassem represents an additional threat for which technology developers must find countermeasures. However, he insists that such countermeasures be practical and affordable, considering the limited physical damage caused by such threats.

“The Qassem is part of the phenomenon of air terror, or border terror,” the officer said in a mid-January interview. “It’s very crude and very cheap, and while its destructive effect is marginal, the psychological impact is significant.”

The officer said the Israel Air Force is concerned about threats spanning the spectrum of ranges and capabilities. “We are concerned about all ranges of threats, not just the 100-kilometer missiles, but also the 15-kilometer Qassems. But we don’t want to intercept a 100-kilometer missile with Arrow or 15-kilometer rockets with something designed to destroy more significant threats,” he said.

As for the SRBMD effort, government and industry sources say the competing industrial teams are offering two distinct concepts, which IMDO will evaluate for technical feasibility and economic practicality.

The Israel Aircraft Industries-Boeing concept will feature a warhead similar to that developed for the Arrow, which uses electro-optics to steer itself very close to the incoming missile before releasing a high-powered burst of explosive fragments that destroy the target. In contrast, the Rafael-Raytheon team is basing its proposal on a ground-launched version of the Israeli firm’s air-to-air missile that relies on kinetic energy to destroy targets through the sheer force of impact.

In a Feb. 16 announcement, Debra Rub-Zenko, vice president for Boeing Integrated Missile Defense, said the Boeing-Israel Aircraft Industries team would build on the successful partnership the two firms established through co-production of the Arrow.

Industry sources said the team expects its proposed SRBMD interceptor to cost about $250,000 per copy, about one tenth that of Patriot Pac-3 missiles. The Rafael-Raytheon team is proposing “a hit-to-kill missile at a tactical missile price” in a similar $200,000-$250,000 range, said an industry executive.

Sara Hammond, a spokeswoman for Raytheon Missile Systems in Tucson, Ariz., declined comment prior to publication of an official announcement on firm’s role in the prospective SRBMD program.