Majority Statement

• Olympia J. Snowe

  Senator
  Read statement

  Majority Statement

  Olympia J. Snowe

  Statement of Olympia J. Snowe at the Coast Guard’s Revised Deepwater Implementation Plan Hearing

  We have an urgent Coast Guard matter at hand that now demands our attention. Admiral Collins, Ms. Wrightson, and Mr. O’Rourke, I'd like to thank each of you for testifying at this critical hearing on the Coast Guard’s Revised Deepwater Implementation Plan.

  I also want to thank my fellow Committee members for attending this morning and demonstrating their commitment to the future of the United States Coast Guard. For years and years, this Committee has watched this military service attempt to do more with less, and this unsustainable pattern has caught up with us.

  We are here today because this Committee, and this nation, must understand the dire situation in which the Coast Guard now finds itself, regarding its “Deepwater” recapitalization plan. Eight years ago, Deepwater was conceived in the knowledge that the Coast Guard’s aging vessels and aircraft needed to be modernized, and they proposed to do this over a 20-year timeline. At the time, we thought this would be sufficient.

  But then on September 11th, 2001, everything changed. Everything, that is, except for the Coast Guard’s assessment of how Deepwater would help them meet the new terrorist threats facing our nation. The Coast Guard recently issued a report that, shockingly, says it actually needs fewer ships, planes, and helicopters than before 9/11.

  That violation of common sense is at the crux of today’s hearing. This Committee must expose the heart of the contradictions before us, and help the Coast Guard immediately correct its course. If we let the Administration continue with this way of thinking, the foundations of Deepwater will continue to crumble before our eyes.

  I am sure that Admiral Collins will testify that – as always – his men and women can “get by” with what the Administration has requested. As admirable as that stance is, however, the cold hard truth remains that the Coast Guard is experiencing a record number of casualties and mishaps like never seen before, and it is becoming simply unsafe for our young men and women to serve aboard these aging assets. Catastrophic engine failures and main space casualties have risen at an alarming rate in the fleet.

  Because my colleagues and I were alarmed to see this chronic downward spiral of asset failures, we directed the Coast Guard to report on how it can reverse this trend. In the Department of Homeland Security Appropriations Act for FY 2005, as part of our oversight for the largest Coast Guard acquisition in history, we called for this report. We knew that the original Deepwater plan was outdated, since it was developed before September 11th, 2001. We intended to have the Coast Guard evaluate its operational and asset requirements in a post-9/11 environment – in which we have significantly greater knowledge of terrorist attacks and other threats.

  As we delve into this new plan for revising Deepwater, however, it becomes glaringly obvious that it does not meet the demands of a post-9/11 world. I am stunned and disheartened to learn that the Administration tells us that this service may not require as many ships in the water and airframes in the sky. They try to justify this by saying that the Deepwater assets will have “greater capabilities” than those in the original Deepwater plan. Therefore, the Coast Guard says it does not need as many assets. While I agree that new technologies are essential to accomplishing the service’s missions, such capabilities simply do not substitute for actual on-the-water presence. Capacity is the most important capability of all.

  When I study the figures in this report, and compare the number of assets that the service originally called for to what this revised plan says, I am overtaken by total disbelief to see the Coast Guard wants fewer ships and aircraft. And that is relying more and more on simply upgrading its legacy assets, at a time when these old assets are failing more frequently. Phrase it however you would like...or cushion the numbers to create the illusion of having more... but nothing will substitute for the fact that our nation requires more new assets – along with more capabilities – in the water and in the air. And we must utilize those assets now.

  Allow me to elaborate. Despite a massive increase in the Coast Guard’s homeland security mission, this report does not propose increasing the number of ships patrolling our shores. Even more disturbing – the total number of cutters could be less than what was originally planned. The National Security Cutter went from 6 to a range of 6-8, the Offshore Patrol Cutter remained the same (this is the workhouse of the fleet), and the Fast Response Cutter went from 58 to a range of 43-58. These figures are not capable of meeting the expanded mission responsibilities that Congress has assigned to the service. Simply put, the role of the Coast Guard in defending our nation has increased exponentially, and its available resources should reflect this reality.

  Another aspect of this report I find equally disturbing is the total absence of the word acceleration. I find it shocking that the Coast Guard did not evaluate ways to shorten the time frame for acquiring Deepwater assets. Completing Deepwater on a 10 or 15-year timeline, would not only offer a cost savings of up to $4 billion over the life the program, it also gives the American taxpayers a Coast Guard capable of meeting its vital security missions, sooner rather than later. The Coast even conducted its own acceleration feasibility study and stated that acceleration was possible, it save billions of dollars, and it provided thousands of more operational mission hours.

  I emphasize security, because we are not talking about theoretical threats in some far-off land…the dangers are a reality that we risk facing every day. Therefore, as the GAO rightly noted, we need to focus on how well this service is actually performing in its multiple missions. This graph [referencing chart], which the Coast Guard provided, illustrates the gaps in performance that the service is experiencing. This clearly shows the inadequacy of the proposed Deepwater solution (purple line) in closing the performance gap (red line) as a result of the severe degradation of legacy assets (grey line). Simply put, the ships and planes that have served the Coast Guard well for so long can no longer absorb the pace of operations required to secure this nation in today’s world.

  Admiral Collins, having served as Chairman of this Fisheries and Coast Guard Subcommittee for more than 8 years, I refuse to believe this report reflects what you want for the young men and women serving under you. I strongly believe the Coast Guard serves as a cornerstone of our Department of Homeland Security…and cornerstones of our national security should not be in the dilemma the Coast Guard now finds itself.

  But we would be mistaken to frame this hearing totally around questions of national security, because the Coast Guard has been uniquely positioned to perform a wide variety of missions critical to our nation’s maritime needs. Last year alone, the Coast Guard responded to more than 32,000 calls for assistance and saved nearly 5,500 lives. These brave men and women prevented 376,000 pounds of marijuana and cocaine from crossing our borders, stopped more than 11,000 illegal migrants, conducted more than 4,500 fisheries boardings, and responded to more than 24,000 pollution incidents.

  The Coast Guard also aggressively defended our homeland as it undertook more than 36,000 port security patrols, conducted 19,000 boardings, escorted more than 7,200 vessels, and maintained more than 115 security zones. The Coast Guard has reviewed and approved domestic security plans for 9,580 vessel and 3,119 facilities, and they verified security plan implementation on 8,100 foreign vessels.

  We must all take note of these figures, because with the current condition of its assets and the continued degradation of its ships and planes, the Coast Guard will lose its ability to maintain this impressive track record. For now, we can still applaud the Coast Guard for its success, but my concern at this hearing focuses on the service’s ability to carry out these achievements and successes long into the future.

  And Deepwater is the future of the Coast Guard. Without the advanced assets and capabilities that this program will provide, our mariners and coastal communities will watch these benefits erode. The nation cannot afford to lose or reduce the on-the-water presence of this vital agency…because if we do, more lives will be lost at sea, that is the hard truth. Now is the time for Congress to renew our commitment to properly fund and ensure the Coast Guard is capable of doing all that we ask of it. It is time to turn words into action, so that our Coast Guard is no longer the 40th oldest of 42 naval fleets in the world, an embarrassing fact that I continue to state year after year.

  The Coast Guard should no longer have to say, “we can do more with less.” It is time for us to remove that phrase from the Coast Guard’s vocabulary, once and for all. It is unfortunate that a quote I once heard from a past Commandant is coming true today…that “doing more with less will evolve into doing everything with nothing.” I refuse to accept this statement, which undercuts the very core of our homeland security.

  Admiral Collins, our nation relies upon the Coast Guard today more than ever before. I intend to ensure you have the necessary resources to carry out the agency’s homeland security and traditional missions now, and for the future. But I cannot give your men and women the assets they require unless you tell us what the Coast Guard needs, not what the Office of Management and Budget thinks the Coast Guard should have based on its budget models. Let me remind you how the 2004 Coast Guard Authorization Bill amended Section 93 of title 14 of the US Code: after informing the Secretary, the Coast Guard Commandant is authorized to make recommendations to Congress as you consider appropriate. Admiral, please use this law as we intended.

  Ms. Wrightson, I want to welcome you again to the Senate and thank you for all the service you have provided us in assisting the Coast Guard in their endeavors. I look forward to your testimony today.

  Mr. O’Rourke, I welcome you to our Committee and look forward to your testimony. I have read your recent report on the Coast Guard’s Deepwater Program and acknowledge your expertise in the national defense, homeland security, and shipbuilding issues facing this nation. Again, welcome. I thank you all for appearing today.

• Ted Stevens

  Senator
  Read statement

  Majority Statement

  Ted Stevens

  
  Chairman Stevens Opening Statement and Q&A

  
  I understand every word that the Chair has said. I think those of you at the table really have been magicians at fitting in the requirements in the limited budget that’s been made available to you. So, I hope we’ll all keep in mind that even your request for Fiscal Year 2006 you’ve got anticipated costs of maintaining legacy assets eating up more than a quarter of your Deepwater funding. And, we’ve just got to understand that it’s the budget process, not the planning process that has led us to the position we’re in. I don’t disagree with what Senator Snowe has said at all. But, I do think that it’s the same thing we’re facing in the Services, we’re facing in many areas because of the budget constraints that we face right now due to the deficit and the war. We’ve got to find some way to get through this period without destroying the future of the Deepwater program or of the overall military services. I look forward to your testimony and I look forward to working with Senator Snowe to try to find some way to start the process of reducing this eating away at the Deepwater funding because of the increase costs of maintaining an aging fleet. Thank you very much.

  _______________________________________________________

  Questions & Answers

  Chairman Stevens: I don’t know if you realize it, but the President’s request is $966 million for Deepwater. The Senate Appropriations is currently at $906 million. The House is at $466 million. And, the House authorization is $1.4 billion. I think that the responsibility for this modernization lies in Congress, not in the Coast Guard. I do believe so. Admiral Collins, have you ever tried to work out a joint procurement schedule with the Navy? Why do we have these two ships that are so close together in size and function and being built by different specifications, different yards? An industrial base is one thing, but do we need two industrial bases?

  Admiral Collins: We’ve been closely allied with the Navy on the performance requirements of this whole program. When we developed the performance specifications for Deepwater, we did it in conjunction with the Navy. We went to the Navy and asked we asked what are the Naval Operational Requirements that we need to embed in the performance contract. We did that. But, they are fundamentally two different missions, the mission set. If you take a look at the Littoral Combat Ship, for example, that’s a premium on speed. It’s a premium on speed and a modular approach to the mission. We have a different mission dynamic. Ours is persistent presence for interdiction, apprehension, prosecution, arrest and we get the speed not through the platform. We get the speed through of combination of the system. The fast small boat, the fast helicopter with the ship. We think that it’s a better value proposition. Speed costs a bunch of money. You build a 45-knot ship and it’s a very expensive ship. The comparable ship to the Littoral Combat Ship is our medium ship, the Offshore Patrol Cutter. It will be a much more affordable ship for the United States Coast Guard, designed to cost $200 million. The Littoral Combat Ship is a $300 million ship before you put one mission module on there. That’s going to be pushing upward to $400 million by the time it’s through. So, I think it’s a better value proposition for us. It’s built with Navy requirements into it, so it’s interoperable with the Navy and we have, of course, a national fleet policy statement that ensures that we mange and deploy our ships synergistically. So, I think we have the best balance, Senator, on the mission, the requirement and the collaboration with the Navy under the present approach.

  Chairman Stevens: Good, good. I appreciate your answer. It clarifies it. Ms. Wrightson what do you say about that answer?

  Ms. Wrightson: I’m going to defer to the Coast Guard on that. We haven’t done an analysis of the relationship between the Navy acquisition and the Coast Guard Acquisition. Perhaps Mr. O’Rourke wants to comment on that.

  Mr. O’Rourke: I guess what I would say is that on the industrial base the linkage is not with the Littoral Combat Ship. It’s with the Navy’s DDX Destroyer program. The Navy has reduced planned procurement of that ship to one per year and there’s concern about whether a one per year rate would be enough to sustain the two yards that build the Navy’s larger surface combatants. So, from an industrial base perspective, you look at the DDX program and what might happen to that and use that to inform a decision on how Coast Guard procurement of larger cutters might be able to help that situation.

  Chairman Stevens: Did CRS and GAO look at the problem the Coast Guard has in terms of increasing costs of maintenance of aging vessels when there is no funding for a replacement?

  Mr. O’Rourke: I understand that in a situation of constrained resources, if were to accelerate cutter procurement, you’re going to have to get that money from somewhere and you’re going to have to reduce something else to do it. In the longer run, if you accelerate cutter procurement, you will reduce the cost of those cutters through better economies of scale. You’ll also reduce the legacy costs associated with maintaining the older cutters sooner.

  Chairman Stevens: Are you implying that Congress ought to have a BRAC process to tell the Coast Guard to shut down some of these aging ships?

  Mr. O’Rourke: I guess what I’m saying is that in a constrained funding environment, Congress will have to make difficult choices, but they should at least understand what some of their option are and what the trade-offs are involved in those options.

  Chairman Stevens: Is one of those options to shut down some of these old vessels that cost so much to maintain?

  Mr. O’Rourke: The option I’m suggesting that people at least be aware of is purchasing the cutters sooner, once their design was locked down, getting a better price on them, and saving money there, and also possibly saving money because you’re getting rid of the older cutters sooner as a consequence of getting the new cutters into service sooner.

  Chairman Stevens: Ms. Wrightson?

  Ms. Wrightson: We attempted to do an analysis of whether or not there would be cost savings to accelerate the program. But, in the end of the day, the Coast Guard really didn’t have the data that we would need to look at from a systems-to-systems perspective. From an asset-by-asset procurement you probably could do that analysis, although it still is an open question whether we’d have the data for it. I want to make two points about the acceleration. When you think about whether or not you should accelerate, it’s not just about the impact on the industrial base, although that certainly is important. You also have to ask about risks and one that hasn’t been mentioned is human systems engineering. You know, we already recognize that as a major risk and that’s the people aspect of Deepwater.

  Chairman Stevens: Please stop right there ma’am, my time is already up and I want to hear from Admiral Collins. What do you say about that Admiral?

  Admiral Collins: Of course I bristle at the thought of laying up ships without replacements them Senator, because that just exacerbates further our capacity issue. We have ships that particularly, up in your great State of Alaska, elderly ships…

  Chairman Stevens: They’re almost as old as I am, Admiral.

  Admiral Collins: Sir, they’re mature. We call them mature cutters. But, to retire them without replacement would be a huge impact on our readiness and our mission accomplishments.

  Chairman Stevens: That’s the answer I expected. You don’t have that option.

  Admiral Collins: No, sir. I think what we’re doing is trying to invest prudently in the current systems to keep them at the readiness level they are and then to move as quickly as affordability issues and budget constraints and everything else will allow us to do. Example: the fast response cutter – so, we’ve advanced that from, that was originally a 2017 entry into the fleet, we’ve moved that up to 2007. That is because, why? Because that is one of legacy systems that is old and tired and wearing out and we’ve got to get on with that. We also advanced by five years the design of the medium cutter, originally like a 2012 type of thing and we’re designing that as we speak. So, we’ve taken an asset-by-asset look and said, “What are the old, tired ones? What are the ones we have to advance?” So, part of the implementation plan was moving those two systems forward and we had to make some trade-offs because of affordability and budget constraint. We had to move some of the aircraft to the right to keep it in balance. So, that’s our dilemma Senator.

  Chairman Stevens: In the view of the generosity of the Chairman, do you want to finish Ms. Wrightson?

  Mr. Wrightson: If I could, I agree with what the Commandant has said about the cutters, the decision to take a look at those and sort of target your risks in order to make sure that the assets that you’re investing in are the ones you need the most. That makes sense. The human systems engineering point I was going to make is an important one because right now what we’re seeing that is a growing risk in the Deepwater program. It’s the people side of this program and currently even the Coast Guard is dissatisfied with ICGS there. So going forward when we look at the mission-need statement this coming year and analyze it and when we look at the management of the program, we’re going to focus on this issue as well as others related to the adequacy and efficiency of the ____ plan to see if it really does the things that the Coast Guard is going to need. And, you’ve requested us to do that. Thank you.
  

Minority Statement

• Daniel K. Inouye

  Senator
  Read statement

  Minority Statement

  Daniel K. Inouye

  We have waited a long time for the revised Deepwater plan and I look forward to discussing it with our esteemed witnesses.

  The Deepwater program is integral to the evolution of the Coast Guard in our post 9-11 world. This revised plan is the first time we have been able to examine the Coast Guard’s vision for the future. Because of an aging fleet and expanded responsibilities, without the Deepwater acquisition, the Coast Guard will soon be constrained to meet its safety and security responsibilities.

  There are a couple of key issues to consider. First, it is vital that we help the Coast Guard move forward with Deepwater in a timely manner.

  Second, we need to know why the 20-year revised plan has a notable reduction in the number of key assets being requested. I am concerned that reducing the number of requested cutters in the face of increased need may lead to problems down the road as we rely more heavily on legacy assets.

  I understand that many assets will have new communications and intelligence capabilities, which should act as “force multipliers.” However, even the best of such systems need a threshold level of physical presence to be effective.

  Third, I am told that no simulation has yet been run using the precise mix of assets and capabilities actually provided in the revised plan. Thus, we do not know if the plan will meet the needs.

  Fourth, I have concerns regarding the oversight and management of the Deepwater project. The only other major government program using a Lead System Integrator Approach, the Army’s Future Combat System, is being reevaluated due to concerns with oversight and conflicts of interest.

  I look forward to hearing today about the Coast Guard’s efforts to deal with these issues.
  

Testimony

• Mr. Ronald O'Rourke

  Specialist in National Defense

  Congressional Research Service
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  Testimony

  Mr. Ronald O'Rourke

  Click here for Mr. O'Rourke's testimony.

• Admiral Thomas Collins

  Commandant

  U.S. Coast Guard
  Read statement

  Testimony

  Admiral Thomas Collins

  Click here for Admiral Collins' testimony.

• Ms. Margaret Wrightson

  Director, Homeland Security and Justice Team

  United States Government Accountability Office
  Read statement

  Testimony

  Ms. Margaret Wrightson

  Click here for Ms. Wrightson's testimony.