“Growing Missions, Shrinking Fleet” –USNI

The US Naval Institute has an argument in favor of funding National Security Cutter #12

The author talks about the shortage of ships both because of the failure of the crew rotation concept and because of the shortfall revealed in the Fleet Mix Study. This has been discussed in the Congressional Research Service report on Cutter Acquisition.

What I found new, was information about SOUTHCOM interceptions,

In congressional testimony last year, Admiral Craig Faller, Commander, U.S. Southern Command, noted: “The Coast Guard’s presence any given day is six to eight cutters. . . . But, keep in mind, we’re talking about covering areas the size of the United States—with from six to 10 ships. And so, the interdiction percentage with the current assets we have is about 6 percent of the detections. So, we need more ships.”

that is a lower interception rate than previously reported, and impact on jobs,

The NSC is an indispensable national asset. The economic impact of the NSC production line touches nearly 500 suppliers across 39 states. An additional ship order would help jumpstart the U.S. economy and have an immediate and profound effect on a host of U.S. suppliers, who stand ready to deliver. Moving forward with a 12th NSC is low risk.

If we had been further along with the Offshore Patrol Cutter (OPC), I would say, just build another OPC instead of a twelth NSC, but we were way behind in starting the OPC program and the difficulties at Eastern put us even further behind.

The OPC program is so far behind, that the Bertholf is likely to be 30 years old before the 25th OPC is ready for its first operational mission. Plus we really do need more than 36 large patrol cutters, but the fact we have not done a new Fleet Mix Study in almost ten years does not help our case.

 

“Coast Guard Pursuing Ambitious ‘Tech Revolution’” –NationalDefenseMagazine

National Defense Magazine is reporting the Coast Guard is planning major upgrades to its connectivity.

Improvements are planned for both routine reporting and staff work and for Command and Control,

“The Coast Guard was slated to transition to Microsoft Office 365 this spring to increase email reliability. Plans also include making internet speeds 50 times faster this year and improving ship connectivity over the next three years, Schultz noted.”

Plus there will be additional Cyber expertise.

“President Donald Trump’s fiscal year 2021 budget request calls for adding 179 cyber personnel to the Coast Guard’s existing force, Schultz noted. The service currently has about 360 cyber personnel, and about 50 or 60 are coming on board this year.”


However, the Coast Guard isn’t just looking to play defense, he noted. It wants to conduct its own cyber attacks against adversaries.

Presumably all this will include better connectivity in the polar regions. The Healey was reportedly out of contact for long periods during her last trip to the Arctic.

Recently sections of the Rescue 21 system were down for prolonged periods in Alaska. We don’t want that to happen.

“Coast Guard Cutter Procurement: Background and Issues for Congress, Updated April 15, 2020” –CRS

The Congressional Research Service (CRS) has again updated their “Coast Guard Cutter Procurement: Background and Issues for Congress.” The last updated edition of this analysis, that I reported on here, was dated 28 Jan. 2020. The FY2021 PC&I request includes funding for OPC#3 and long lead time material for #4, plus small amounts for the NSC and FRC program. Not addressed here is the second Polar Security Cutter for which funding is also requested, addressed in a separate CRS report. There is a good breakdown of the entire request for vessels here.

As noted earlier, eight Marine Protector class, 87 foot WPBs are to be decommissioned without replacement. 

Congress has routinely added Webber class Fast Response Cutters to previous budgets. I have to believe the Congress will fund four additional FRCs, if not in FY2021 then in 2022, so that we can ccomplete the program of record and replace all six Island class WPBs of PATFORSWA. A 12th NSC seems much less likely, but not impossible. The summary for the 15 April edition is quoted below. 

Summary

The Coast Guard’s program of record (POR) calls for procuring 8 National Security Cutters (NSCs), 25 Offshore Patrol Cutters (OPCs), and 58 Fast Response Cutters (FRCs) as replacements for 90 aging Coast Guard high-endurance cutters, medium-endurance cutters, and patrol craft. The Coast Guard’s proposed FY2021 budget requests a total of $597 million in procurement funding for the NSC, OPC, and FRC programs. It also proposes a rescission of $70 million in FY2020 procurement funding that Congress provided for the NSC program.

NSCs are the Coast Guard’s largest and most capable general-purpose cutters; they are replacing the Coast Guard’s 12 Hamilton-class high-endurance cutters. NSCs have an estimated average procurement cost of about $670 million per ship. Although the Coast Guard’s POR calls for procuring 8 NSCs to replace the 12 Hamilton-class cutters, Congress through FY2020 has fully funded 11 NSCs, including the 10th and 11th in FY2018. In FY2020, Congress provided $100.5 million for procurement of long lead time materials (LLTM) for a 12th NSC, so as to preserve the option of procuring a 12th NSC while the Coast Guard evaluates its future needs. The funding can be used for procuring LLTM for a 12th NSC if the Coast Guard determines it is needed. The Coast Guard’s proposed FY2021 budget requests $31 million in procurement funding for activities within the NSC program; this request does not include further funding for a 12th NSC. The Coast Guard’s proposed FY2021 budget also proposes a rescission of $70 million of the $100.5 million that Congress provided for a 12th NSC, with the intent of reprogramming that funding to the Coast Guard’s Polar Security Cutter (PSC) program. Eight NSCs have entered service; the seventh and eighth were commissioned into service on August 24, 2019. The 9th through 11th are under construction; the 9th is scheduled for delivery in 2020.

OPCs are to be less expensive and in some respects less capable than NSCs; they are intended to replace the Coast Guard’s 29 aged medium-endurance cutters. Coast Guard officials describe the OPC and PSC programs as the service’s highest acquisition priorities. OPCs have an estimated average procurement cost of about $411 million per ship. The first OPC was funded in FY2018. The Coast Guard’s proposed FY2021 budget requests $546 million in procurement funding for the third OPC, LLTM for the fourth, and other program costs. On October 11, 2019, the Department of Homeland Security (DHS), of which the Coast Guard is a part, announced that DHS had granted extraordinary contractual relief to Eastern Shipbuilding Group (ESG) of Panama City, FL, the builder of the first four OPCs, under P.L. 85-804 as amended (50 U.S.C. 1431-1435), a law that authorizes certain federal agencies to provide certain types of extraordinary relief to contractors who are encountering difficulties in the performance of federal contracts or subcontracts relating to national defense. ESG reportedly submitted a request for extraordinary relief on June 30, 2019, after ESG’s shipbuilding facilities were damaged by Hurricane Michael, which passed through the Florida panhandle on October 10, 2018. The Coast Guard intends to hold a competition for a contract to build OPCs 5 through 15.

FRCs are considerably smaller and less expensive than OPCs; they are intended to replace the Coast Guard’s 49 aging Island-class patrol boats. FRCs have an estimated average procurement cost of about $65 million per boat. A total of 60 have been funded through FY2020, including four in FY2020. Four of the 60 are to be used by the Coast Guard in the Persian Gulf and are not counted against the Coast Guard’s 58-ship POR for the program, which relates to domestic operations. Excluding these four FRCs, 56 FRCs for domestic operations have been funded through FY2020. The 36th FRC was commissioned into service on January 10, 2020. The Coast Guard’s proposed FY2021 budget requests $20 million in procurement funding for the FRC program; this request does not include funding for any additional FRCs.

“Coast Guard Modifies Contract to Construct Second Offshore Patrol Cutter, Acquire Long Lead-Time Material for Third Offshore Patrol Cutter” –CG-9

Above: Artists rendering from Eastern Shipbuilding Group

Contract for the Second Offshore Patrol Cutter, the future USCGC Chase, and long lead time items for the third. Presumably this is a contract modification, rather than the  exercise of a contract option, because the price is higher than the original option. Still this does not look a great deal higher than the previous contract ($317.5M), for the first OPC and long lead time items for the second. Following from the Acquisitions Directorate, CG-9:

The U.S. Coast Guard modified its contract with Eastern Shipbuilding Group (ESG) April 2 to begin construction of the second Offshore Patrol Cutter (OPC) and to acquire long lead-time material (LLTM) for the third OPC. Contract delivery of the second OPC, to be named Chase, is scheduled to occur in 2023.

The total value of the construction and LLTM orders is $343 million. In addition to ordering construction of the second OPC, this contracting action also covers the initial order of components and materials necessary to support the future construction of the third OPC by acquiring propeller and steering components, marine diesel engines, the ship integrated control system, switchboards, and generators.

The lead OPC is currently in production at ESG’s shipyard in Panama City, Florida.  Production of the lead cutter, Argus, commenced January 7, 2019. Delivery of Argus is scheduled for 2022.

The OPC meets the Service’s long-term need for cutters capable of deploying independently or as part of task groups and is essential to stopping smugglers at sea, interdicting undocumented migrants, rescuing mariners, enforcing fisheries laws, responding to disasters and protecting our ports. The acquisition of 25 OPCs will complement the capabilities of the Service’s National Security Cutters, Fast Response Cutters and Polar Security Cutters as an essential element of the Department of Homeland Security’s layered security strategy.

For more information: OPC program page

“Coast Guard Polar Security Cutter (Polar Icebreaker) Program: Background and Issues for Congress” Updated 12 March, 2020, CRS

The Congressional Research Service has once again updated their report on the Polar Security Cutter. You can see the whole report here. I have reproduced the one page summary below. The entire report is a 63 page pdf. 

Summary

The Coast Guard Polar Security Cutter (PSC) program is a program to acquire three new PSCs (i.e., heavy polar icebreakers), to be followed years from now by the acquisition of up to three new medium polar icebreakers. The PSC program has received a total of $1,169.6 million (i.e., about $1.2 billion) in procurement funding through FY2020, including $135 million in FY2020, which was $100 million more than the $35 million that the Coast Guard had requested for FY2020. With the funding it has received through FY2020, the first PSC is now fully funded and the second PSC has received initial funding.

The Coast Guard’s proposed FY2021 budget requests $555 million in procurement funding for the PSC program. It also proposes a rescission of $70 million in FY2020 funding that Congress had provided for the procurement of long lead time materials (LLTM) for a 12th National Security Cutter (NSC), with the intent of reprogramming that funding to the PSC program. The Coast Guard states that its proposed FY2021 budget, if approved by Congress, would fully fund the second PSC.

The Coast Guard estimates the total procurement costs of the three PSCs as $1,039 million (i.e., about $1.0 billion) for the first ship, $792 million for the second ship, and $788 million for the third ship, for a combined estimated cost of $2,619 million (i.e., about $2.6 billion). Within those figures, the shipbuilder’s portion of the total procurement cost is $746 million for the first ship, $544 million for the second ship, and $535 million for the third ship, for a combined estimated shipbuilder’s cost of $1,825 million (i.e., about $1.8 billion).

On April 23, 2019, the Coast Guard-Navy Integrated Program Office for the PSC program awarded a $745.9 million fixed-price, incentive-firm contract for the detail design and construction (DD&C) of the first PSC to VT Halter Marine of Pascagoula, MS, a shipyard owned by Singapore Technologies (ST) Engineering. VT Halter was the leader of one of three industry teams that competed for the DD&C contract. The first PSC is scheduled to begin construction in 2021 and be delivered in 2024, though the DD&C contract includes financial incentives for earlier delivery.

The DD&C contract includes options for building the second and third PSCs. If these options are exercised, the total value of the contract would increase to $1,942.8 million (i.e., about $1.9 billion). The figures of $745.9 million and $1,942.8 million cover only the shipbuilder’s costs; they do not include the cost of government-furnished equipment (GFE), which is equipment for the ships that the government purchases and then provides to the shipbuilder for incorporation into the ship, or government program-management costs. When GFE and government programmanagement costs are included, the total estimated procurement cost of the first PSC is between $925 million and $940 million, and the total estimated procurement cost of the three-ship PSC program is about $2.95 billion.

The operational U.S. polar icebreaking fleet currently consists of one heavy polar icebreaker, Polar Star, and one medium polar icebreaker, Healy. In addition to Polar Star, the Coast Guard has a second heavy polar icebreaker, Polar Sea. Polar Sea, however, suffered an engine casualty in June 2010 and has been nonoperational since then. Polar Star and Polar Sea entered service in 1976 and 1978, respectively, and are now well beyond their originally intended 30-year service lives. The Coast Guard plans to extend the service life of Polar Star until the delivery of at least the second PSC. The Coast Guard is using Polar Sea as a source of spare parts for keeping Polar Star operational.

Coast Guard Budget in “A Budget for America’s Future, Fiscal Year 2021” and a small, unpleasant surprise

White House, South Side. Photo by MattWade from Wikipedia

Looking for information on the 2021 budget I came across “A Budget for America’s Future, Fiscal Year 2021” issued from the White House by the GAO. It covers the entire Federal budget. It is a 138 pages. It mentions the Coast Guard only three times. (No, I did not read the entire document, used the “control F” function to find them.) I have reproduced those parts below. The third was a bit of a surprise.

  1. In addition, the Budget includes $1.6 billion to continue the important work of modernizing the U.S. Coast Guard vessels and aircraft that patrol the Nation’s coastal borders. (page 6 or 10 of 138 in the pdf)
  2.  In addition, the Budget includes $1.6 billion to continue to modernize U.S. Coast Guard vessels and aircraft that patrol and provide life-saving rescue missions across the Nation’s coastal borders.  The Budget includes funding for a second polar icebreaker to ensure America is at the forefront of safeguarding uninterrupted, year round commercial activity, trade, and supply routes and confirming America’s leadership role in the Arctic and Antarctic. (page 56 or 60 of 138 in the pdf)
  3. Focuses on Sound Budgeting.  The Budget proposes to shift $215 million in Overseas Contingency Operations (OCO) funding for the U.S. Coast Guard into the Department’s base budget.  This furthers the Administration’s goal of ensuring that the OCO request funds only temporary overseas warfighting operations and does not fund enduring operations “off budget.” (page 58 or 62 of 138 in the pdf)

The third entry caught my eye. I can only think of one significant “Overseas Contingency Operation,” PATFORSWA, which is funded by DOD. It sounds like DHS wants to terminate PATFORSWA. This might explain why the last two Webber class FRCs, which would have presumably gone to PATFORSWA, were not included in the FY2021 budget. 

Depending on your degree of cynicism, other possibilities are that DHS wants to increase the total budget that they control, or that they want make CG budget look bigger when it was really money we were getting already.

The on line edition of Seapower, the Navy League magazine’s, report on the budget included something that surprised me.

The 2021 budget also proposes $35.5 million to manage retirements of old assets, including the decommissioning of two Secretary-class high-endurance cutters, two Island-class patrol boats and eight Marine Protector-class patrol boats. (emphasis applied-Chuck)

Looks like we are starting to decommission the 87 foot WPBs without a replacement in sight. For at least the last five years, I have been saying we were going to need a replacement for these in the near future, here, here, here, but I was still surprised because I have seen nothing about a replacement.

“Coast Guard Cutter Procurement: Background and Issues for Congress Updated January 28, 2020” –CRS

The Congressional Research Service has again updated its look at cutter procurement. (Note, this link will take you to the latest version of the report and is subject to change with each update.) While I cannot be sure there are no other changes, I believe the significant changes are a reflection of the result of the House and Senate Conference Committee. From page 25.

Conference In final action, the FY2020 DHS Appropriations Act became Division D of H.R. 1158, the Consolidated Appropriations Act, 2020. The explanatory statement for Division D of H.R. 1158/P.L. 116-93 of December 20, 2019, provides the funding levels shown in the appropriation conference column of Table 2. The explanatory statement for Division D of H.R. 1158 states: The agreement [for the Coast Guard’s Procurement, Construction, and Improvements account] provides an increase of $537,850,000 above the request, including … $260,000,000 for a total of four FRCs…. The bill makes available $100,500,000 for long lead time material for a twelfth National Security Cutter, consistent with the direction in the House Report….

I have reproduced Table 2 from page 21 of the report below. The following explanatory note is quoted from the CRS report:

“Source: Table prepared by CRS based on Coast Guard’s FY2020 budget submission, HAC committee report, and SAC chairman’s mark and explanatory statement on FY2020 DHS Appropriations Act. HAC is House Appropriations Committee; SAC is Senate Appropriations Committee.”

Summary of Appropriations Action on FY2020 Acquisition Funding Request

Table 2 summarizes appropriations action on the Coast Guard’s request for FY2020 acquisition funding for the NSC, OPC, and FRC programs.

Table 2. Summary of Appropriations Action on FY2020 Acquisition Funding Request Figures in millions of dollars, rounded to nearest tenth

  • Request______Request______HAC_______SAC_____Final
  • NSC program ____60 _______160.5 _______60 _____160.5
  • OPC program ___457 _______457 _______457 ______312
  • FRC program ___140 _______290 _______240 ______260
  • TOTAL _________657 ______907.5 ______757 ______732.5

So again Congress is providing funding above that requested by the administration.

The increase from two to four Webber class is consistent with previous Congressional action, and should actually result in a savings over the life of the program, in that it is in line with the current contract options and will not require a renegotiation that might have raised the cost of individual cutters by up to $10M. That means a total of 62 Webber class will have been funded. Only two additional in FY2021 are planned, for a total of 64, 58 in the program of record plus six for PATFORSWA to support CENTCOM, but I would not be surprised to see four in the final FY2021 budget.

The addition of $100.5M for Long Lead Time items for a twelfth National Security Cutter looks like a strong commitment to fund another Bertholf class National Security Cutter.

Relative to the OPC program, from page 26:

OPC Program.- The contract awarded to construct the OPC was recently amended to address increased cost estimates after the Acting Secretary determined that relief permitted under Public Law 85-804 was appropriate and necessary to the national defense. An associated delay in delivery of the first two hulls reduced the fiscal year 2020 requirement for the OPC by $145,000,000. Funds included in the agreement continue necessary program requirements. The agreement maintains the commitment to ensuring the Coast Guard can continue the program of record for these critical vessels. As a condition of the granted relief, the vendor will be subject to increased oversight, including additional scrutiny of the costs borne by the Coast Guard. The Coast Guard shall brief the Committees quarterly on the metrics used to evaluate adherence to production timelines and costs, including those attributed to reestablishing the production line and maintaining the skilled workforce required to ensure contract performance.

So Congress is going to let the decision to allow extraordinary relief to Eastern Shipbuilding go ahead. The reduction of OPC funding that had been requested is only due to delays in the program and presumably the deletion of long lead time materials for OPC #5 from the payments that had been planned for Eastern.