FY2019 PC&I Appropriations

I have not been able to find a complete FY2019 Coast Guard budget as it was signed into law, but we do have at least a partial list of Procurement, Construction, and Improvement appropriations for ships and aircraft based on two Congressional Research Service reports (Coast Guard Polar Security Cutter (Polar Icebreaker) Program: Background and Issues for Congress” and “Coast Guard Cutter Procurement: Background and Issues for Congress “) and a Homeland Security Today report.

$1,507.6M For Ships (LLTI refers to Long Lead Time Items):

  • $675M   for the first Polar Security Cutter and LLTI for the second
  • $400M   for the second Offshore Patrol Cutter and LLTI for the third
  • $340M   for six Fast Response Cutters
  • $72.6M  for the National Security Cutter program
  • $15M     for life extension work on Polar Star
  • $5M       for initial work on procuring an additional Great Lakes Icebreaker

Coast Guard C-130J

$208M For Aircraft:

  • $105 for the HC-130J program (I think that is one aircraft)
  • $95M for MH-60T recapitalization (reworking existing aircraft I believe)
  • $8M for upgrades to the MH-65s

That is $1,715M for the items above. This, hopefully, is not all. I don’t have a figure for the Waterways Commerce Cutter (a small figure at this point), no information on unmanned systems, and there should also be money to address the backlog of shoreside improvements, but this does seem to show a recognition of the real needs of the Coast Guard for recapitalization. Looks like the $2+B annually for PC&I the Coast Guard has been saying they need is within reach.

 

 

“Coast Guard patrols South Pacific in support of international fisheries”

A boarding team from the Coast Guard Cutter Mellon (WHEC 717) approach a fishing vessel on the high seas in January 2019 while patrolling in support of counter-Illegal, Unregulated and Unreported fishing and global security missions. Mellon’s crew is supporting international fisheries on the high seas and enforcement of the Western Central Pacific Fisheries Commission (WCPFC). (U.S. Coast Guard photo by Coast Guard Cutter Mellon)

When I reported Betholf’s departure for the Western Pacific, Jan. 22, 2019, I speculated that after Munro’s visit to the Solomon Islands and Fiji, reported Dec. 8, 2018, that perhaps we were seeing the start of a new trend. Apparently I was a bit late in my prediction because, apparently Mellon had already followed Munro into the Western Pacific, departing Seattle shortly after Christmas. The CCGD14 news release below will explain.

Something else I noticed in the news release, was that while in Hawaiian waters, Mellon had conducted Astern Re-fueling-at-Sea training with the U.S. Coast Guard Cutter Joseph Gerczak (WPC 1126). We also had a report of an underway refueling of a Webber Class Cutter when USCGC Oliver F. Berry (WPC-1124) completed a 2,200 mile transit for Operations in the Marshall Islands. Could this be preparation for multi-unit operations in the Western Pacific?

Crew from the U.S. Coast Guard Cutter Mellon performed two community outreach events while in Suva, Fiji, in January 2019. Children admitted at the Colonial War Memorial Hospital in Suva had the opportunity to meet with and hear stories from the crew during their community relations event at the hospital led by Petty Officer 3rd Class Sarah Patanapaiboon and the crew also refurbished the hospital gardens. (U.S. Coast Guard photo by Coast Guard Cutter Mellon)

The News Release

HONOLULU — Following a stop in Fiji in late January, the crew of the Coast Guard Cutter Mellon (WHEC 717) continue their South Pacific patrol in support of counter-Illegal, Unregulated and Unreported fishing and global security missions.
 
The presence of a high endurance Coast Guard cutter conducting operations in the region demonstrates the U.S. commitment to regional partnerships and strengthening a coalition of like-minded countries to strengthen regional maritime governance and promote a rules-based regime for fisheries.
 
Mellon’s crew is supporting international fisheries on the high seas and enforcement of the Western Central Pacific Fisheries Commission (WCPFC). Upon arrival in the WCPFC convention area, they partnered with the Canadian Armed Forces who flew seven reconnaissance flights improving maritime domain awareness and aiding in the enforcement of the WCPFC convention. Patrolling over 1,110 square miles within the WCPFC convention area, the Mellon’s law enforcement team boarded two vessels, one fishing vessel and one bunkering vessel. Both boardings resulted in potential violations of conservation management measures including high seas transshipment and specifications for the marking and identification of fishing vessels. 
 
“Participating in the WCPFC ties into a broader strategy the Coast Guard is pursuing in the Indo-Pacific region,” said Capt. Stephen Burdian, commanding officer, cutter Mellon. “Throughout the area, the U.S., and by extension the Coast Guard, is encouraging relationships respecting the sovereignty, supporting fair and reciprocal trade, and the rule of law in an open and free Oceania. Through a tactical lens, that strategy looks like a Coast Guard boarding of a foreign fishing vessel, while on the high seas or in a sovereign Exclusive Economic Zone (EEZ) jointly with a member of that country’s enforcement team. On this patrol, we are fortunate to have excellent support from the U.S. Navy, U.S. Marine Corps, and our Canadian counterparts.”
 
While on a port call in conjunction with the US Embassy in Suva, Fiji, the crew strengthened partnerships with Pacific Islands Nation communities by participating in community relations events at a local animal shelter, children’s hospital and garden.  At the animal shelter crew members engaged with kittens and puppies while giving animals baths and general clean-up of the shelter.  At the children’s hospital and garden, the crew read books to children and tidied up the garden area.  
 
Mellon’s crew of 150 departed their homeport of Seattle shortly after Christmas. They made a brief stop in Hawaii for fuel and supplies. This stop was leveraged for training as the crew conducted Astern Re-fueling-at-Sea training with the U.S. Coast Guard Cutter Joseph Gerczak (WPC 1126). Also, they worked with Air Station Barbers Point crews to complete 72 shipboard helicopter evolutions over three days, resulting in the qualification of three M H-65 Dolphin helicopter pilots and 10 flight deck personnel aboard Mellon.  The cutter also embarked two Canadian Department of Fisheries and Oceans Officers, two U.S. Navy Aerographer’s Mates, and one U.S. Marine Corps Mandarin translator while in Hawaii for the upcoming operations. The crew is more than 8,000 miles into their patrol and have taken every opportunity for professional development with more than 40 crew earning new qualifications.
 
Oceania covers an area of 3.3 million square miles and has a population of 40 million and is home to some of our valued strategic partners in the Pacific Island Nations as well as Australia and New Zealand, with whom the U.S. has aligned for more than a century.
 
The importance of the Pacific Islands is very evident as the Coast Guard continues operations in the region and the U.S. strengthens partnerships with the governments of these nations. We recognize tourism and exports, both requiring a great deal of commercial vessel traffic, are a primary economic driver. Tuna represented a nearly $5 billion industry in 2015 with more than half the world’s tuna is sourced from the Western Pacific. In 2017 reported landings were 2.5 million tons of fish.
 
The presence of a high-endurance cutter in this part of the Pacific to enforce Conservation and Management Measures established by the Western and Central Pacific Fisheries Commission represents the U.S. and the Service’s commitment to our partnerships in the region. This body represents another essential collaboration. The WCPFC is an international body made up of 43 nations and international organizations. Members agree to allow the 13-enforcer nations in the pact to board and record any potential violations on their nationally flagged vessels. The findings go to the WCPFC who notifies the vessel’s flag state of the suspected infraction for further investigation.
 
“The U.S. Coast Guard and the Canadian Department of Fisheries and Oceans have a long history of working together to ensure the viability of fish stocks off North America.  Working with experts from Canada and regional leaders like Fiji is vital to ensuring food security and the rule of law in Oceania,” said Capt. Robert Hendrickson, Chief of Response for Coast Guard 14th District. “Working together we are helping to ensure a more secure, free and open Indo-Pacific.”

Alameda-based Coast Guard cutter and crew depart for Western Pacific patrol


Got a news release reporting the departure of Bertholf from Alameda California for a Patrol in the Western Pacific which I have quoted below. Normally I would leave reporting of ship deployments to other sites, but, I don’t think this is routine.

We have sent cutters into the Western Pacific (since Vietnam). Munro (WMSL-755) visited Fiji and the Solomon Islands in 2018 (Paying More Attention to the Western Pacific, Dec. 8, 2018). Waesche made the trip back in 2012 (Waesche Enroute to SE Asia Apr. 4, 2012).There could have been others, but I don’t think there were a lot more, but coming on the heels of Munro’s deployment this may be a trend.

There is also a video here. The Captain tells the crew, “We’re going to be doing a national security mission. When we get underway, we are going to be working for the United States Indo-Pacific Command, Combatant Commander. We’re going to be executing national security operation throughout the Pacific.”

What is the mission? Certainly they will be doing some capacity building, exercising with partner navies and coast guards. They will probably do some fisheries enforcement both, in the US EEZ and with shipriders to assist in the EEZs of friendly nations, certainly in Oceana and perhaps in SE Asia. We have a huge expanded Pacific Remote Islands Marine National Monument wit  490,000 square statute miles or about 390,000 square nautical miles of Ocean to police (Huge New Marine Reserve, Pacific Remote Islands Marine National Monument, Sep. 26, 2014). Plus there are the island nations of Micronesia, the Marshall Islands, and Palau joined with the U.S. in “Compacts of Free Association.”

There have been calls for more US Coast Guard presence in the Pacific from New Zealand and from the 7th Fleet. Some, including the previous Commandant see the US Coast Guard as a counter weight to China Coast Guard in the South China Sea.

Maybe Bertholf will stop in at Guam and check it out as a possible future base for Offshore Patrol Cutters. We already have indication three Webber class FRCs will replace the two 110s currently there.) Will they operate in the South China Sea? Will they do Freedom of Navigation Ops? Taking Vietnamese ship riders aboard and doing fisheries enforcement in the Vietnam EEZ inside the Chinese claimed Nine Dash Line, could get exciting. Guess we will have to wait and see.

Will they have a UAS aboard? And If we have no budget or continuing resolution to pay our people, how are we paying for fuel?

The News Release

On a gray and foggy morning, tears intermingled with rain as family members braved the elements to say goodbye to the 170 crewmembers of Coast Guard Cutter Bertholf (WMSL-750), a 418-foot national security cutter, which departed Alameda, California, Sunday for a patrol in the Western Pacific Ocean.

The U.S. Coast Guard has an enduring role in the Indo-Pacific going back over 150 years. The service’s ongoing deployment of resources to the region directly supports U.S. foreign policy and national security objectives in the Indo-Pacific Strategy and the National Security Strategy.

“The United States is a Pacific nation,” said Vice Adm. Linda Fagan, commander Coast Guard Pacific Area, who was present to see the cutter depart. “We have deep and long-standing ties with our partners in the region, and more importantly, we share a strong commitment to a free and open Indo-Pacific, governed by a rules-based international system that promotes peace, security, prosperity and sovereignty of all nations.”

Bertholf will be operating in support of United States Indo-Pacific Command, which oversees military operations in the region. As part of its planned operations, the cutter will engage in professional exchanges and capacity building with partner nations.

“Security abroad equals security at home,” said Fagan. “Enhancing our partners’ capabilities is a force multiplier in combating transnational criminal and terrorist organizations and deterring our adversaries.”

As both a federal law enforcement agency and an armed force, the Coast Guard is uniquely positioned to conduct defense operations in support of Combatant Commanders on all seven continents. The service routinely provides forces in joint military operations worldwide, including the deployment of cutters, boats, aircraft and deployable specialized forces.

“I’m excited to see Bertholf sail today to the Indo-Pacific region of operations,” said Fagan, who described the cutter as one of the most capable in the Coast Guard fleet.

“They will be serving alongside other DoD military forces, particularly the U.S. Navy, and I know they will contribute key capabilities to that mission set. This crew has worked incredibly hard to get ready for today’s sailing, and I can’t think of a better ship and crew to be sending to the Indo-Pacific.”

Commissioned in 2008, Bertholf is the first of the Coast Guard’s legend class national security cutters. These advanced ships are 418-feet long, 54-feet wide, and have a 4,600 long-ton displacement. They have a top speed in excess of 28 knots, a range of 12,000 nautical miles, endurance of up to 90 days and can hold a crew of up to 170.

The cutter is named for Coast Guard legend Ellsworth P. Bertholf, who served as captain of the Revenue Cutter Bear during the famous Overland Relief Expedition, earning the Congressional Gold Medal. As the Coast Guard’s fourth commandant, Bertholf oversaw the transfer of the Coast Guard into the Department of the Navy during World War I and advocated for the successful postwar reconstitution of the service.

National security cutters feature advanced command and control capabilities, aviation support facilities, stern cutter boat launch and increased endurance for long-range patrols to disrupt threats to national security further offshore.

The Coast Guard is scheduled to commission its seventh national security cutter, the Coast Guard Cutter Kimball, in 2019. Kimball, along with the Midgett, which is currently under construction, will be homeported in Honolulu and will enhance the Coast Guard’s presence throughout the Indo-Pacific.

“The U.S. Coast Guard’s unique authorities, capabilities, and missions make us the maritime safety and security partner of choice for sea-going countries around the world,” said Capt. John Driscoll, Bertholf’s commanding officer. “Our increased presence throughout the Indo-Pacific will enhance regional stability and improve maritime governance and security.”

In an address to the families and crew before the cutter set sail, Driscoll emphasized how critical family support is to crew wellbeing and readiness.

“Support from our families, wherever they live, is vital to ensuring we are ready to sail and answer the demands of our nation,” Driscoll said. “We must ensure our families are ready to weather the storm at home. We operate in a dangerous and high-consequence environment, and your ability to focus on mission can become easily compromised if you are worried about family.”

Fagan acknowledged the current lapse in appropriations and government shutdown has added stress and feelings of uncertainty to the typical emotions that surround a cutter departure.

“I know it is hard for these crews to be leaving behind their dependents and spouses – it’s a thousand times more so when everyone is wondering when our next paycheck will be, and how they can support the family they are leaving behind,” Fagan said.

“There has been an incredible outpouring of support for the families here in the Alameda area, but the tension and the anxiety for the crew is real,” said Fagan. “We are standing by to help support those families who are left behind the same way that we are going to support the crew as they sail for the Western Pacific.”

Hearing: “Review of Recent GAO Reports on Icebreaker Acquisition and the Need for a National Maritime Strategy”

Note: Apparently as a result of the Government Shutdown, links to the House of Representative’s Website that have been included in this are no longer available and once you get their error message you will no longer be able to back arrow to this site. You will have to reload. Hopefully these link will be reestablished some time in the future, so I have left them in. I have been unable to relocate some of the quotations below to provide more specific citations so I am going to go ahead and publish without them.  

Again, I have to apologize for being late in analysis of a Congressional hearing. In this case it is the House Committee on Transportation and Infrastructure’s Subcommittee on the Coast Guard and Maritime Transportation, “Review of Recent GAO Reports on Icebreaker Acquisition and the Need for a National Maritime Strategy” that took place on 29 November, 2018.

The video actually begins at minute 21.

Witnesses were:

  • Rear Admiral Michael J. Haycock, Assistant Commandant for Acquisition & Chief Acquisition Officer, United States Coast Guard  | Written Testimony
  • Rear Admiral Mark H. “Buz” Buzby, USN, Ret., Administrator, Maritime Administration  | Written Testimony
  • Ms. Marie A. Mak, Director of Acquisition and Sourcing Management, Government Accountability Office  | Written Testimony
  • Mr. Andrew Von Ah, Director of Physical Infrastructure Issues, Government Accountability Office  | Written Testimony
  • Mr. Ronald O’Rourke, Specialist in Naval Affairs, Congressional Research Service  | Written Testimony

Subcommittee members present included:

All five Representatives won reelection, so it is probable we will see them on the Subcommittee next year. Representative Garamendi was clearly excited and optimistic about the becoming chair of the House Sub-Committee. He strongly reports Coast Guard recapitalization. He also expressed a desire to see Rep. Brian Mast return as ranking member.

The two topics were essentially unrelated. We have revisited the topic of the Polar Security Cutter/Heavy Polar Icebreaker numerous times.

GAO is still contending there are Scheduling and Technological risks. They don’t seem to recognize the steps that have been taken to minimize these risks and that the largest scheduling risk is in delaying the start of the project once the detail design is substantially complete. There is real urgency in the need to replace Polar Star and they don’t seem to recognize that. Yes, the Coast Guard might have done a better job, if we had started this project about a decade earlier, and we might have done that if they had not continued to insist we had to keep our AC&I (now PC&I) budget to about $1.1B, but we can no longer afford more delay to achieve a drawn out, risk free, acquisition process.

Mr. O’Rourke once again made the case for block buy vs a contract with options, contrasting the way the Coast Guard has contracted for vessels while the Navy has successfully used Block Buy and Multi-Year contracting for vessels much more complicated than those being procured by the Coast Guard.

The need for a National Maritime Strategy reflected a realization that the US ability to transport military reinforcements to a theater of conflict in American ships with American crews seems to be in jeopardy. We discussed this problem and what the Coast Guard could do about it here.

Rather than reference the exchange on the video above as I have done before, I will just highlight parts of the two source documents, the “Summary of Subject Matter” (a six page pdf) and Congressional Research Service Naval Expert, Ronald O’Rourke’s prepared statement.

Regarding the Polar Security Cutter (Heavy Polar Icebreaker or HPIB), from the summary of subject matter

The Coast Guard Acquisition Directorate is conducting a tailored technical readiness assessment to update the HPIB cost estimate with an estimated completion of June 30, 2019.

The Coast Guard Acquisition Directorate will update the program schedule within three months of the Detail Design and Construction contract award and before awarding construction, as appropriate, with an estimated completion date of September 30, 2019.

The Coast Guard Acquisition Directorate is conducting a tailored technical readiness assessment to analyze and determine schedule risks with an estimated completion of June 30, 2019.

Since presumably much of this work would be done by civilian acquisitions specialist, it is likely the work is falling behind because of the government shut down

Shift in Security Environment; New National Defense Strategy

A Maritime Strategy has not been issued. If it had it would likely need an update given that both the Administration and Geopolitical situation have changed.

Mobility Capabilities and Requirements Study 2018 (MCRS-18)

 DOD states that it started the study, which it refers to as the Mobility Capabilities and Requirements Study 2018 (MCRS-18), on March 8, 2018, and that it is scheduled for completion in the fall of 2018…A September 25, 2017, press report about MCRS-18 states that “Since the early 1990s, Pentagon mobility studies have consistently identified a requirement for about 20 million square feet of roll-on/roll-off capacity to quickly transport material in support of a contingency.” Mobility studies conducted from the 1990s until recently, however, were all done in the post-Cold War era, when U.S. military force planning focused to a large degree on potential crises and conflicts against regional military powers such as Iran and North Korea. Given the recent shift from the post-Cold War era to the new era of renewed great power competition and the resulting formal shift in U.S. military force planning toward a primary emphasis on potential challenges posed by China and Russia, it is not clear that MCRS-18 will leave the figure of 20 million square feet of roll-on/roll-off capacity unchanged. A change in this figure could have implications for the content of a new national maritime strategy.

We have seen no indication of movement on these documents.

Potential Shortfall of Navy Escorts and Possible Impacts on Mariners

 GAO notes MARAD’s September 2017 estimate of a potential shortage of U.S.-citizen mariners available to crew U.S.-owned reserve sealift ships during a crisis or conflict. The challenge of finding adequate numbers of appropriately trained mariners to crew DOD sealift ships in time of crisis or conflict is a longstanding issue, dating back at least to 1990, when mariners in their 50s, 60s, and 70s (and one aged 81), some brought out of retirement, were reportedly needed to help fill out the crews of DOD sealift ships that were activated for Operation Desert Shield (the initial phase of the U.S. reaction to Iraq’s 1990 invasion of Kuwait). Problems in filling out ship crews reportedly contributed to delays in activating some RRF sealift ships to participate in the operation.  A potential shortage of U.S.-citizen mariners for manning DOD sealift ships in wartime has been a recurring matter of concern since then.

“Was I to die this moment, ‘Want of Frigates’ would be found stamped on my heart.”, Lord Nelson to Earl Spencer, 9 August 1798

Section 1072 of the National Defense Authorization Act for Fiscal Year 2018 (H.R. 2810/P.L. 11591 of December 12, 2017) requires the Navy to submit a report on its plans for defending combat logistics and strategic mobility forces—meaning Navy underway replenishment ships, RRF sealift ships, and MSC surge sealift ships—against potential wartime threats. The report is to include, among other things, a “description of the combat logistics and strategic mobility forces capacity, including additional combat logistics and strategic mobility forces, that may be required due to losses from attacks,” an “assessment of the ability and availability of United States naval forces to defend combat logistics and strategic mobility forces from the threats,” and a “description of specific capability gaps or risk areas in the ability or availability of United States naval forces to defend combat logistics and strategic mobility forces from the threats….”

This was brought sharply into focus in a surprisingly frank article in Defense News, dated October 10, 2018, “‘You’re On Your Own’: US Sealift Can’t Count on Navy Escorts in the Next Big War,”

My earlier post talks about what the Coast Guard could do to mitigate this shortfall, but the most significant step would be to bring back the Coast Guard ASW mission. Equipping eleven NSCs and 25 OPCs with ASW systems could make a huge difference.

 

“Coast Guard Awards Production For 10th and 11th National Security Cutters” –CG-9

NSC 5 James on builders trials in the Gulf of Mexico March 30, 2015.

The Acquisitions Directorate (CG-9) reports award of production contracts for the tenth and eleventh National Security Cutter. While some of the cost was already covered in procurement of long lead time items. The price looks good.

The Coast Guard awarded a fixed-price contract option to Huntington Ingalls Industries Inc. of Pascagoula, Mississippi, today for the production of the 10th and 11th national security cutters (NSCs). The option exercised is valued at approximately $930 million.

The 10th and 11th NSCs will be built at Huntington Ingalls Industries’ shipyard in Pascagoula.

Six NSCs are currently in service. Coast Guard cutters Hamilton and James are stationed in Charleston, South Carolina, and Coast Guard cutters Bertholf, Waesche, Stratton and Munro are stationed in Alameda, California. The seventh NSC, Kimball, will be commissioned in January 2019 in its Honolulu, Hawaii, homeport. Midgett, the eighth cutter, is planned for a 2019 delivery; it will be the second NSC stationed in Honolulu. The ninth cutter, Stone, is slated for delivery in fiscal year 2021.

Paying More Attention to the Western Pacific

Fijian navy Sub-Lt. Opeti Enesi looks out from an Air Station Barbers Point HC-130 Hercules over the Fijian Islands, Dec. 8, 2018. The Hercules aircrew was providing support for a Fijian navy patrol boat during law enforcement operations. (U.S. Coast Guard photo by Petty Officer 3rd Class Matthew West/Released)

Was pleasantly surprised to see that the Coast Guard seems to be paying more attention to the Western Pacific, where the US has a huge part of its Exclusive Economic Zone. (More than the entire Atlantic and Gulf coasts.) Additionally it is an area where Illegal Unreported, and Unregulated (IUU) fishing threatens to destabilize local economies, and where our frenemy China is attempting a neo-colonialism that could turn smaller Pacific nations into vassal states.

The cutter Munro visited Fiji and the Solomon Islands on its first operational patrol. A shiprider agreement was concluded on Nov. 12 during the visit to Suva, Fiji, and a Fijian naval officer flew aboard a Barber’s Point C-130 coordinating operations with a Fijian patrol boat.

This is after the USCGC Oliver F. Berry (WPC-1124) completed a mission to conduct operations in the Republic of the Marshall Islands, 2,200 miles from her homeport over the last summer.

“Building the Fleets of the Future: Coast Guard and NOAA Fleet Recapitalization”–Senate Hearing

Congress is back in session. It is likely the current Congress will attempt to complete the Department of Homeland Security (DHS) Budget before the new Congress is seated in January.

On October 11, 2018, the Senate Subcommittee on Oceans, Atmosphere, Fisheries, and Coast Guard held a public hearing entitled,  “The Future of the Fleets: Coast Guard and NOAA Ship Recapitalization.” I feel I have been remiss in not talking about this earlier, but the topics are still in question and it appears all the major players in the sub-committee will be returning next year, although committee assignments may change. Despite the name of the hearing, the NOAA representative was unable to attend, so the entire hearing was about Coast Guard programs.

Unfortunately the hearing video was not posted on YouTube so I was unable to post it here. The Commerce Committee website with the video of the hearing, list of witnesses, and links to the prepared statements is here.

I’d like to call attention to the Congressional Research Service’s evaluation of the Coast Guard’s shipbuilding programs in the form of Mr. Ronald O’Rourke’s prepared testimony for the hearing. It is relatively short at 21 pages, and covers the Waterways Commerce Cutter (Inland tenders) and Polar Security Cutter (Heavy Polar Icebreaker) as well as the National Security Cutter (NSC), Offshore Patrol Cutter (OPC), and Fast Response Cutter (FRC) programs.

As he has done frequently in the past, he makes the case for procuring cutters using Block Buy or Multi-Year Procurement as the Navy has done in some of its most successful Program. I have a hard time understanding why the Coast Guard has not taken advantage of this option. We had an opportunity to do it with the NSC, another with the FRC. Now we have the option of using Block Buy for the Polar Security Cutter (heavy polar icebreaker) and Offshore Patrol Cutter (OPC). The recent Coast Guard Authorization Bill includes authorization to use Block Buy.

Conducting the hearing were:

The video does not actually begin until about time 9:30

Senator Baldwin pushes “Made in America Shipbuilding Act” advocating that components as well as the ships themselves be made in America.

20:30 Admiral Haycock’s prepared statement begins.

26:00 GAO Ms. Marie Mak Director, Contracting and National Security Acquisitions, Government Accountability Office began her prepared statement.

Mrs Mak of GAO is again saying we have not made a good business case for the new icebreaker and that our planning is short term. Pointed to the Navy 30 year shipbuilding plan as a good example of long term planning.

29:30 Mr. Ronald O’Rourke Specialist in Naval Affairs, Congressional Research Service began his prepared statement

An illustration of how useful long term planning can be is found in this quote from Mr. O’Rourke’s written submission, p.3:

“As one example of how…Congress has exercised its constitutional power to set funding levels and determine the composition of federal spending, during the period FY2008-FY2015, when the Navy’s shipbuilding account averaged about $14.7 billion per year in then-year dollars, there was recurring discussion about the challenge of increasing the account to the substantially higher annual funding levels that would soon be needed to begin implementing the Navy’s 30-year shipbuilding plan. Projections were prepared by CBO showing the decline in the size of the Navy that would occur over time if funding levels in the shipbuilding account did not increase substantially from the average level of about $14.7 billion per year. Congress, after assessing the situation, increased the shipbuilding account to $18.7 billion in FY2016, $21.2 billion in FY2017, $23.8 billion in FY2018, and $24.2 billion in FY2019. These increasing funding levels occurred even though the Budget Control Act, as amended, remained in operation during those years. At the most recent figure of $24.2 billion, the Navy’s shipbuilding account is now 74% greater in then-year dollars than it was as recently as FY2010.”

Mr. O’Rourke pointed out that using Multi-Year contracting to procure the Offshore Patrol Cutters could save us $1B, enough to pay for the Polar Security Cutter (PSC or Polar Icebreaker) or the entire Waterways Commerce Cutter program.

He discussed increasing rate of OPC procurement.

He noted that there had been a reduction in the estimated cost of the Polar Icebreaker from an initial estimate of $1B to a projected cost of $2.1B for three ships. From pages three and four of his prepared statement.

Coast Guard’s Non-Use of Multiyear Contracting

In connection with my work on ship acquisition, I maintain the CRS report on multiyear procurement (MYP) and block buy contracting. In both that report and in testimony I have given to other committees in recent years on Coast Guard ship acquisition, I have noted the stark contrast between the Navy— which uses multiyear contracting (in the form of MYP or block buy contracting) extensively to reduce its ship- and aircraft-procurement costs by billions of dollars—and the Coast Guard, which to date has never used multiyear contracting in one of its ship or aircraft acquisition programs.

The Navy in recent years, with congressional approval, has used multiyear contracting for, among other things, all three of its year-to-year shipbuilding programs—the Virginia-class attack submarine program, the DDG-51 destroyer program, and the Littoral Combat Ship (LCS) program. The Navy has been using multiyear contracting for the Virginia-class and DDG-51 programs more or less continuously since the 1990s. Savings from the use of MYP recently have, among other things, helped Congress and the Navy to convert a nine-ship buy of DDG-51 class destroyers in FY2013-FY2017 into a 10-ship buy, and a nine ship buy of Virginia-class attack submarines in FY2014-FY2018 into a 10-ship buy. The Navy is also now using block buy contracting in the John Lewis (TAO-205) class oiler program, and is considering or anticipating using them for procuring LPD-17 Flight II amphibious ships, FFG(X) frigates, and Columbia-class ballistic missile submarines. The Navy’s use or prospective use of multiyear contracting for its year-to-year shipbuilding programs is arguably now almost more of a rule than an exception in Navy shipbuilding. For Congress, granting approval for using multiyear contracting involves certain tradeoffs, particularly in connection with retaining year-to-year control of funding. In the case of Navy shipbuilding, Congress has repeatedly accepted these tradeoffs.

In contrast with Navy practice, the Coast Guard often uses contracts with options in its ship-procurement programs. Contracts with options can be referred to as multiple-year contracts, but they are not multiyear contracts. Instead, contracts with options operate more like annual contracts, and they cannot achieve the kinds of savings that are possible with multiyear contracts. Like the other military services, the Coast Guard has statutory authority to use MYP contracting and can be granted authority by Congress to use block buy contracting.

Questioning began time 33:00 I will try to summarize some of the discussion, but this is in no way complete.

Senator Sullivan

33:30 questioned how the CG could meet increasing challenges with nearly 14,000 fewer major cutter OP Hours.

RAdm Haycock says new assets are more capable. (He might have noted that FRCs are more capable than Island class and can conduct some missions previously conducted only by major cutters.) He did favorably compare FRCs with existing 110s in Alaska, but perhaps missed an opportunity to push for more assets and/or higher rate of construction.

37:30 Senator Sullivan push to use shipyard in Ketchikan.

Senator Baldwin

42:30 Why are we using predominately foreign made outboards rather than Mercury or Evinrude which are made Wisconsin?

Ans. We want to use American made products, but we also employ competition. We could create a demand signal that is not sustainable. Builders choose components, but must comply with Buy American requirements.

49:30 Senator Sullivan:

Suggestion that perhaps we could lease.

Ans. Design time has decreased as has price due to Navy assistance and use of parent design. Ship and power plant can be smaller than previously thought without loss of capability. Icebreaker will be based on Parent design. Cooperation with the Canadians. This has shortened time line and cost has come down. There are still some risks.

59:30 We have looked exhaustively at foreign designs. Our missions are very different. Our design will be based on yet unbuilt Canadian design (CCGS Diefenbaker).

1:01:30 Baldwin:

Great Lakes Icebreaker–not enough resources, push to build a Great Lakes Icebreaker at least as capable as Mackinaw, some funding provided for design of a Great Lakes icebreaker, what are we doing?

We are looking at requirements. 140s are going through service life extension.

1:04:40 More on made in American requirements.

Ans. Sometime foreign made components can be problematic over lifecycle. 

1:07:00 Senator Wicker

The Senator pushing for 12th NSCs.

NSCs are having a profound impact as we push border south

1:09:00 Polar Security Cutter, what about the fact funding is not included in House budget?

Ans. Will impact scheduling and the interest of the industrial base.

1:12:00 Senator Blumenthal

Concern about opioids, what additional assets do we need?

Talked about Unmanned Air Systems but really did not specifically address opioids intel which I would assume has more to do with importation by merchant ships through our ports.

1:15:00 CG museum. Committed to location at New London.

1:16:30 Admissions at the CG Academy–concern about possible discrimination

1:17:30 Senator Baldwin

1:18:00 More on “Made in America” components

1:20:00 Specifically referenced need to buy propulsion pods for Polar Security Cutter from Scandinavia.

1:21:30 Timeline for Inland tenders? Possibility of using parent craft?

Our needs are different. Have to have more people because of our missions, we need more range, mixed gender birthing. Probably nine months to complete analysis and a year before we start to contract. In service 2023. We are moving as fast as we can.

(Was pleased to note that RAdm Haycock made a strong witness and appeared both competent and cooperative.)