[Senate Hearing 112-233]
[From the U.S. Government Publishing Office]
S. Hrg. 112-233
THE U.S. COAST GUARD BUDGET AND OVERSIGHT
=======================================================================
HEARING
before the
SUBCOMMITTEE ON OCEANS, ATMOSPHERE, FISHERIES, AND COAST GUARD
of the
COMMITTEE ON COMMERCE,
SCIENCE, AND TRANSPORTATION
UNITED STATES SENATE
ONE HUNDRED TWELFTH CONGRESS
FIRST SESSION
__________
JUNE 23, 2011
__________
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SENATE COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION
ONE HUNDRED TWELFTH CONGRESS
FIRST SESSION
JOHN D. ROCKEFELLER IV, West Virginia, Chairman
DANIEL K. INOUYE, Hawaii KAY BAILEY HUTCHISON, Texas,
JOHN F. KERRY, Massachusetts Ranking
BARBARA BOXER, California OLYMPIA J. SNOWE, Maine
BILL NELSON, Florida JIM DeMINT, South Carolina
MARIA CANTWELL, Washington JOHN THUNE, South Dakota
FRANK R. LAUTENBERG, New Jersey ROGER F. WICKER, Mississippi
MARK L. PRYOR, Arkansas JOHNNY ISAKSON, Georgia
CLAIRE McCASKILL, Missouri ROY BLUNT, Missouri
AMY KLOBUCHAR, Minnesota JOHN BOOZMAN, Arkansas
TOM UDALL, New Mexico PATRICK J. TOOMEY, Pennsylvania
MARK WARNER, Virginia MARCO RUBIO, Florida
MARK BEGICH, Alaska KELLY AYOTTE, New Hampshire
DEAN HELLER, Nevada
Ellen L. Doneski, Chief of Staff
James Reid, Deputy Chief of Staff
Bruce H. Andrews, General Counsel
Brian M. Hendricks, Republican Staff Director and General Counsel
Todd Bertoson, Republican Deputy Staff Director
Rebecca Seidel, Republican Chief Counsel
------
SUBCOMMITTEE ON OCEANS, ATMOSPHERE, FISHERIES, AND COAST GUARD
MARK BEGICH, Alaska, Chairman
DANIEL K. INOUYE, Hawaii OLYMPIA J. SNOWE, Maine, Ranking
JOHN F. KERRY, Massachusetts JOHN ENSIGN, Nevada
BILL NELSON, Florida ROGER F. WICKER, Mississippi
MARIA CANTWELL, Washington JOHNNY ISAKSON, Georgia
FRANK R. LAUTENBERG, New Jersey JOHN BOOZMAN, Arkansas
AMY KLOBUCHAR, Minnesota MARCO RUBIO, Florida
MARK WARNER, Virginia KELLY AYOTTE, New Hampshire
C O N T E N T S
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Page
Hearing held on June 23, 2011.................................... 1
Statement of Senator Begich...................................... 1
Statement of Senator Rockefeller................................. 3
Prepared statement........................................... 4
Statement of Senator Ayotte...................................... 5
Statement of Senator Lautenberg.................................. 5
Statement of Senator Snowe....................................... 25
Witnesses
Admiral Robert J. Papp, Jr., Commandant, U.S. Coast Guard........ 6
Prepared statement........................................... 9
Appendix
Response to written questions submitted to Admiral Robert J.
Papp, Jr. by:
Hon. John D. Rockefeller IV.................................. 43
Hon. Mark Begich............................................. 47
Hon. Bill Nelson............................................. 49
Hon. Olympia J. Snowe........................................ 51
Hon. Roger F. Wicker......................................... 53
THE U.S. COAST GUARD BUDGET AND OVERSIGHT
----------
THURSDAY, JUNE 23, 2011
U.S. Senate,
Subcommittee on Oceans, Atmosphere, Fisheries, and
Coast Guard,
Committee on Commerce, Science, and Transportation,
Washington, DC.
The Subcommittee met, pursuant to notice, at 10:03 a.m. in
room SR-253, Russell Senate Office Building, Hon. Senator
Begich, Chairman of the Subcommittee, presiding.
OPENING STATEMENT OF HON. MARK BEGICH,
U.S. SENATOR FROM ALASKA
Senator Begich. Good morning, we will have a couple members
joining us momentarily. They are running a little late. But, as
ships have to run on time, so should committees. So, thank you
very much.
I'll make a few comments, and depending on who makes it
here on time, they will have an opportunity to say some
comments, too.
Again, good morning, and I welcome Admiral Robert Papp, the
Commander, Commandant of the U.S. Coast Guard, and thank him
for testifying before the Committee today.
Since the very earliest days of our nation, the U.S. Coast
Guard has safeguarded our maritime interests, and our ports, at
sea, and our interior waterways, and on the Great Lakes, and
around the globe. They protect the Nation's maritime economy
and environment, defend our maritime borders, and save those in
peril on our waters. They're Americans' maritime guardian, who
is Semper Paratus--``always ready'' for the hazards and
threats.
Today the U.S. Coast Guard has nearly 42,000 men and women
on active duty, and constitutes a unique multi-mission military
maritime which carries out an array of civil and military
responsibility, and touches almost every facet of the U.S.
maritime environment.
Last year the Coast Guard responded to more than 22,000
search and rescue cases, and saved more than 4,000 lives;
inspected over 250,000 vessels. The Coast Guard saved millions
of dollars in property; seized hundreds of tons of cocaine;
stopped thousands of undocumented migrants for illegally
entering the country; identified 61 individuals associated with
terrorism; and deployed forces overseas in support of our
troops in Iraq and Afghanistan.
The Coast Guard conducted humanitarian missions in Haiti,
led the response to the Deepwater Horizon oil spill, and
investigated thousands of other pollution incidences. Last year
in Alaska alone, the Coast Guard in Alaska responded to 646
search and rescue cases, saved 138 lives, and aided 932 persons
in distress.
In my state, we are proud to be the home of the nation's
largest Coast Guard based in Kodiak. And with the cutters, air
stations, and small boat stations throughout the state, we
think of the Coast Guard as Alaska's navy.
We should honor the every day service and sacrifice of its
men and women by ensuring they have the tools they need to do
all we ask of them, to make sure they're mission-ready. Last
year, Congress took an important step toward this when it, in a
bipartisan fashion--thanks in large part to the leadership of
Chairman Rockefeller, our immediate past Chair of this
subcommittee, Senator Cantwell, and all our full and
subcommittee Ranking Members, Senators Hutchison and Snowe--we
finally enacted updated authorizing legislation for the
service.
The Coast Guard Authorization Act of 2010 provide the Coast
Guard with important statutory authorities they've needed for
some time. The provisions will allow the service to modernize
its command structure, improve its acquisition practices and
financial management, and make a number of improvements to the
lives of Coast Guard personnel and their families, all of which
are integral to the 21st century Coast Guard.
As Chairman of the Subcommittee on Oceans, Atmosphere,
Fisheries, and Coast Guard, I'm looking forward to introducing
and working on a new authorization bill that continues this
progress toward a modern, more efficient, and highly agile
Coast Guard.
But there's more to the mission's readiness than
modernization command structures and updated statutory
authorities, and that's one of the reasons why I've called for
this budget and oversight hearing. The President's request for
Coast Guard's Fiscal Year 2012 budget represents a modest
increase in funding of 1 percent. In a time when budgets are
shrinking, and we are finding ways to tackle the nation's
deficit, this is a victory.
However, many issues remain unaddressed about how to
sustain the Coast Guard's core capabilities at a time when we
continually ask more of them. Case in point: I'm very concerned
about the Coast Guard's mission readiness when we don't
properly equip them. This is particularly true when we look at
the Nation's icebreaker fleet. With one of its two heavy
icebreakers slated for decommission this year, and the others
not coming out of the shipyard and back into service until at
least 2013, the Coast Guard finds itself in a serious
operational gap. Having no heavy icebreaker capability for 2
years or more limits our ability to safeguard our sovereignty
and our interest in the polar regions--and that's putting it
mildly.
How can we expect the Coast Guard to conduct their varied
maritime safety, security and stewardship roles in a remote
area like the North Slope, when they lack the operational
assets and the infrastructure to do so?
Some have also expressed concerns that the Coast Guard is
slowly losing some of the autonomy and latitude it needs to
operate as a flexible, agile, and responsive multi-mission
agency. The Department of Homeland Security, in which the Coast
Guard currently operates, seems in recent years to have
developed an expectation that the Coast Guard can and should
operate just like any other department's subordinate agencies.
I'm concerned that this reduced autonomy will impact the
service's ability to operate effectively and deliver all that
we have to come to expect.
Admiral Papp, I look forward to hearing your testimony. I
want to, before we start with your opening statement, I'm going
to go ahead and ask the members here if they have any opening
comments they'd like to make.
Senator Rockefeller.
STATEMENT OF HON. JOHN D. ROCKEFELLER IV,
U.S. SENATOR FROM WEST VIRGINIA
The Chairman. Thank you, Mr. Chairman, and I'm particularly
happy to be with you, Admiral, and to be with you, Mr.
Chairman. I just, whenever you're chairing a hearing, I just
like to sort of being around to watch you operate.
Senator Begich. That makes me nervous.
[Laughter.]
The Chairman. You're very good. You're calm, very
thoughtful, very good.
And I feel exactly the same way you did, or, do--what you
said. I mean, it's this constant, this constant pull between
needs, and how much attention is the Congress paying? And that
goes back many, many years. And we, I think Chairman Begich and
I would both feel that what we're trying to do is to upgrade--
and we have done--is upgrade the attention that was just paid
to the Coast Guard, make people more aware of what it's done. I
mean, save 4,300 lives, seize more than 90 metric tons of
cocaine, interdicted more than 2,000 undocumented migrants.
You're called on to do all things at all times, and people
expect you will be there. You're kind of a safety net--a
psychological and physical and actual safety net.
And yet, we don't fund you properly. You're not a stark
enough part of our vocabulary, of our subconscience. You are--
of those of us in here, Kelly Ayotte, Senator Ayotte, and
Senator Begich and myself--but, it's discouraging. And now
we're going into this period of downturn on budgets, and that's
even more discouraging, because you've got a couple of 45-year-
old ships doing what they really can't do any longer--although
global warming seems, I guess, is melting the ice a little bit,
so, but I'm not sure that helps enough.
So, I want to say two things. One is, I'm tremendously
proud of your predecessor, I'm tremendously proud of you.
Everything in a situation like that, where people feel at risk,
or they feel unattended to financially and psychologically and
otherwise by the funding body, depends on leadership. And you
clearly have it, just like your predecessor had it. And so, I'm
very grateful for you.
I also want to profoundly apologize to the Chairman, who
may or may not forgive me, because we're having in the Finance
Committee, which started 10 minutes ago, we're going to decide
what to do about entitlements on, in health care. And that is a
viciously nasty and important subject. So, I will have to
leave. But I didn't want to come over to the Hill without
stopping in to pay my respects to you, to the work that your
people do--you have 200 people tucked away in Huntington, West
Virginia who are working all the time--and, you know, the
difference that you make to Senator Begich's part of the world
is just indescribable.
So, I pay you my respects. I, we'll do our very, very best
to get every single dime that we can for you, because the Coast
Guard deserves it. Your men and women deserve it. You deserve
it. And we're not in the habit of doing what we ought to be in
the habit of doing.
So, with that, Mr. Chairman, I conclude my remarks, and
thank you for your chairmanship.
[The prepared statement of Senator Rockefeller follows:]
Prepared Statement of John D. Rockefeller IV,
U.S. Senator from West Virginia
Good morning. As one of our Nation's primary first responders, the
Coast Guard is vital to our national security, economic security,
public safety, and environment.
When I turn on the television or read the paper, I often see the
courageous acts of our Coast Guard men and women. Just last year they:
saved more than 4,300 lives,
seized more than 90 metric tons of cocaine bound for our
streets, and
interdicted more than 2,000 undocumented migrants on the
high seas attempting to illegally cross our borders,
in addition to countless other acts protecting and defending
our homeland.
They did all of this last year, while leading the Federal response
to the Deepwater Horizon oil spill, one of the worst environmental
disasters in our Nation's history.
Following the devastating earthquake in Haiti, the Coast Guard was
the first on the scene- immediately provided rescue and relief, and
again reinforced its motto of Semper Paratus, or ``Always Ready.''
These are truly remarkable accomplishments that underscore
responsiveness, flexibility, and professionalism-all cornerstones of
the U.S. Coast Guard.
As a nation, we depend on the Coast Guard to keep us safe and
secure, but their ability to do that rests on their access to resources
and other support necessary to perform their missions.
They can't do things like respond to the biggest oil spill in U.S.
history and a massive earthquake in Haiti; conduct search and rescue
operations, and countless other things--all on a shoestring budget.
I am concerned that the Coast Guard does not have the necessary
funding to do everything we expect them to do. An aging fleet of ships
and aircraft need to be replaced, numerous shore units, including boat
houses, are crumbling and the Coast Guard does not have the money to
fix it.
I share Chairman Begich's concerns that the Coast Guard's limited
resources are affecting its operations in our polar regions, which are
vital to our national security and its traditional search and rescue
operations.
I am concerned that the National Oceanic and Atmospheric
Administration (NOAA), which is under the Subcommittee's jurisdiction,
is also underfunded and unable to fulfill its obligations to monitor
our polar regions, especially weather. This will not only affect
Alaska, but every community in our country because we all depend on
accurate weather data.
The potential reorganization of the Department of Commerce has me
deeply concerned that an agency as critical as NOAA will get lost in
the shuffle and be placed in another department where it must compete
for limited resources. Further, it will affect its ability to fulfill
its vital mission.
The Coast Guard Authorization Act of 2010, enacted this past
October, provided the Coast Guard the essential tools to successfully
carry out its missions by improving its organizational flexibility,
updating its command structure, and reforming its acquisition
practices. I am proud of this legislation. And I look forward to
working across the aisle and sponsoring another Coast Guard
Authorization bill that will give the Coast Guard the crucial resources
it needs to carry out its missions successfully.
Today, we welcome Admiral Robert Papp, Commandant of the U.S. Coast
Guard. Thank you for your exceptional leadership in these challenging
times.
Senator Begich. Thank you very much, Senator Rockefeller.
And, Senator Ayotte, do you have any opening that you would
like to give?
STATEMENT OF HON. KELLY AYOTTE,
U.S. SENATOR FROM NEW HAMPSHIRE
Senator Ayotte. I would just say thank you, Chairman
Begich, for holding this hearing.
And, thank you, Chairman Rockefeller, Senator Lautenberg.
Admiral, I certainly just want to express my appreciation
for your leadership, and our thanks to all the men and women
who serve underneath you. And certainly, you have an important
role to play in New Hampshire on our coastal waters, and with
respect to our overall safety and national defense. So, thank
you very much for coming before the Committee today, and I look
forward to your testimony. And, thank you again for your
service.
Senator Begich. Senator Lautenberg.
STATEMENT OF HON. FRANK R. LAUTENBERG,
U.S. SENATOR FROM NEW JERSEY
Senator Lautenberg. Thanks, Mr. Chairman.
And thanks, Admiral Papp, for your service, and all of your
colleagues in the Coast Guard.
The motto of the Coast Guard, we need to be reminded, is
Semper Paratus. It translates to ``Always Ready.'' And in this
agency, one of five branches of the American armed services,
lives up to its motto each day. Very often I will see it from
the window of my apartment, which is on the Hudson River in the
town of Cliffside Park, and it would be a long way to wave, but
I always salute them when I see them passing by.
Simply put, the men and women of the Coast Guard are
America's eyes and ears on the seas, and the American people
remain safe because of them.
It goes beyond, way beyond that. I mean, the fact that we
have the kind of marine system that permits private access to
the waters, that protects them. They're there for rescue.
They're there for every, each and every cause. And they play a
critical role in protecting our shores, especially in my home
state of New Jersey, which remains a tempting--said by the FBI,
the most tempting--target for terrorist attack in our country.
So, we're concerned about the ability of the Coast Guard to
continue to do the things that it's capable of as, we make the
resource less complete.
So, it's not just that we're protecting the people there,
the lives of the families. We have chemical plants. We've got
all of these things. But, it also protects our economy. The
Port of New York and New Jersey, the largest on the East Coast,
handled more than $140 billion in cargo last year. So, make no
mistake--the brave men and the women of the Coast Guard are
always there when we need them, and they never let us down.
Last year when a massive earthquake struck Haiti, the Coast
Guard was there evacuating the injured, delivering supplies,
and offering hope to victims. And when oil was gushing into the
Gulf, the Coast Guard was there, working around the clock to
contain the spill, clean up the mess, and save those
communities.
President Obama recognizes the value of the Coast Guard,
and his proposed budget takes positive steps to maintain the
Coast Guard's readiness, including funding to modernize its
aging fleet and bolster its ability to respond to disasters.
And I'm also pleased that the budget includes funding to
rebuild the dilapidated Pier 4 at the Coast Guard's training
center in Cape May, New Jersey. Now, this facility supports the
patrol boats that protect our coastline, trains our Coast Guard
recruits, and I hope that we can provide the resources the
training center needs and deserves.
The fact is, the Coast Guard is constantly put at the back
of the line for resources, constantly forced to do more with
less. There are always new assignments coming out--whether it's
manifests, whether it's channel identities, whether it's there
and searching for contraband, or trying to stem the tide of
refugees trying to gain our shores--it doesn't matter. The
Coast Guard's always there.
And now what's happening, the House Republicans are trying
to compound the problem by giving the Coast Guard even fewer
resources. And I'd like to ask those in the House who represent
districts in coastal states whether they'd like to individually
see State X, Y, or Z with fewer Coast Guard personnel there.
Well, I don't think it would pass the taste test.
And we need to help the Coast Guard replace its aging
fleet, the program that funds port security grants. We've got
to fight as hard as we can to defeat those cuts. And I look
forward to hearing from our distinguished Admiral, Admiral
Papp, on these cuts that would affect the Coast Guard's ability
to be Always Ready when we need it.
And I wouldn't hold back if I was you, Admiral Papp. Thank
you very much for your service.
Senator Begich. Thank you, Senator Lautenberg.
Admiral Papp, thank you very much, again, for joining us
today, and having this opportunity to talk about your budget,
and oversight on some of the needs that you have. Your opening
statement.
STATEMENT OF ADMIRAL ROBERT J. PAPP, JR., COMMANDANT, U.S.
COAST GUARD
Admiral Papp. Thank you, Chairman Begich. It's always good
to see you again.
Senator Lautenberg, always a pleasure.
I'm very honored that Senator Rockefeller came in to make a
statement.
And, Senator Ayotte, welcome to you, and I'll look forward
to seeing Senator Snowe when she arrives.
I want to thank you for the opportunity to be here today,
and for your unwavering support of our United States Coast
Guard--especially for our hardworking Coast Guard men and
women. It continues to be my highest honor and privilege to
lead these men and women, and represent them.
It has been just over a year since I assumed my watch as
the Commandant, so even though my appearance before the
Subcommittee today is labeled as a budget hearing, I also want
to use this opportunity to tell you what we've accomplished,
what our challenges are, and to do my most important job, which
is to tell you what the Coast Guard needs to continue
performing all our challenging maritime missions.
So, first, what we've accomplished: we've performed our
most important service to the country by sustaining front line
operations. Our citizens witnessed the Coast Guard in action
like never before this year, responding to the Deepwater
Horizon oil spill and explosion. While we were conducting that
unprecedented response, thousands of other Coast Guardsmen were
performing all our other persistent missions, just like they're
doing today.
The National Security Cutter Bertholf just completed her
first Alaska patrol, a service which is vital to ensuring the
sustainment of the Alaska commercial fishing industry,
protection of its fishermen, and of our fishery stocks.
As I speak, the medium icebreaker HEALY has loaded a NASA
science team at Dutch Harbor, and is sailing on Thursday for a
6-month patrol to study the impact of the changing conditions
in the Arctic.
In the Arabian Gulf, 700 Coast Guardsmen, including six
patrol boats and a Port Security Unit, are protecting the oil
platforms that provide nearly all of the revenue of the country
of Iraq.
And throughout the flood-ravaged Midwest, Coast Guardsmen
are assisting to protect our citizens and their properties.
Now, shifting gear from operations to authorizations, we've
used the authority that you so generously provided us in the
2010 Coast Guard Authorization Act to move forward with
organizational realignment, acquisition reform, and mariner
safety enhancement. We're continuing to steady the service by
improving the way we deliver mission support to our operational
forces; we've realigned headquarters directorates; we've
established new logistics and service centers and base
commands. These efforts will provide our operational forces
with one-stop shopping for all their mission support needs.
Our acquisition program has also made great strides. We
have a well-trained workforce who now has taken on the
responsibility of systems integrator for all our acquisition
projects. And we continue to implement our Marine Safety
Performance Plan. We're building capacity and competency by
providing direct officer commissions to Maritime Academy
graduates. In fact, on Monday we commissioned 13 new Kings
Point graduates as Coast Guard officers.
But there are challenges out there. As a prudent sailor, I
have always kept a weather eye on the horizon, and today I see
storm clouds forming. I'm well aware of our Nation's current
economic and budget challenges, but our Coast Guard is also
facing significant challenges.
Our most pressing challenge is recapitalizing our major
cutter fleet--the high endurance and medium endurance cutters.
Ships that were designed to last a quarter century are now
approaching a half century of service life--50 years of waves,
wind, and salt spray; 50 years of performing concentrated,
punishing at-sea operations has taken its toll. We're losing
hundreds of patrol days each year due to constant breakdowns.
When these legacy cutters are on patrol, they're less
effective because they lack state-of-the-art systems. And, as a
long-time ship captain, it greatly concerns me that we're
asking our Coast Guard men and women to sail aboard ships that
were basically World War II-era designs. They deserve better.
Now, we've addressed block obsolescence of Coast Guard
cutters before. Nearly 50 years ago, during a speech to a joint
session of Congress, just a few hundred yards from where we sit
today, President John F. Kennedy challenged our Nation to send
an American to the moon. At the same time, Coast Guard naval
engineers were busy designing the venerable 210-foot medium
endurance cutters. The first of that class, the cutter
Reliance, was commissioned just 3 years later.
In March 1969, just 4 months before the heroes of Apollo 11
landed on the moon, the Coast Guard commissioned the cutter
Morgenthau--the eighth of our Hamilton Class high endurance
cutters. Morgenthau's crew deployed a short time later to
Vietnam. Forty-two years later, Morgenthau is still in service.
But she struggles to serve our critical national security
interests.
The newest of our Hamilton Class cutters, Midgett, which is
40 years old, recently entered a routine dock-side maintenance
period. Excessive hull deterioration was discovered, so we're
cropping out and replacing wasted steel throughout her hull
just so she can be safe enough to sail. That's why we need at
least eight National Security Cutters.
But, because of your support, I have some good news to
report. We're making steady progress in replacing our 12
Hamilton Class cutters with eight National Security Cutters.
Two of the planned eight NSCs--Bertholf and Waeshe--have been
delivered. Builder's trials have started on the third--the
cutter Stratton. And this Monday, the shipyard started cutting
steel on the cutter number 4, the new Coast Guard Cutter
Hamilton. And I expect to award the contract for the fifth NSC
this summer.
But our fleet of existing medium endurance cutters--those
210s that I talked about, designed 50 years ago--by the time
they're replaced, they're going to be 60 years old. This is why
the Offshore Patrol Cutter is such an important project for our
service. We're working to finalize the specifications on the
Offshore Patrol Cutter and put out a request for preliminary
design and construction proposals.
This momentum must continue. Gaps in funding
recapitalization are costly; they jeopardize our ability to
protect the nation's high seas and sovereignty. That's why I'm
requesting over $1.4 billion to continue our recapitalization
effort, including funding for major cutters, fast response
cutters, response boats, maritime patrol aircraft, and
sustainment of our aging ships and aircraft.
The ice diminishing Arctic also presents a major challenge.
An entire new ocean is emerging, prompting an increase in human
activity, including commercial vessel traffic, eco-tourism, and
exploration activities. We're in the process of conducting a
High Latitude Study to inform our future needs, but we need to
ensure we are preparing to meet our responsibilities in this
fifth ocean the same way we've done and met them in the other
four.
As I said in the beginning, my most important job is to
tell you what I need. And today, I'm telling you that the
Fiscal Year 2012 budget is the baseline budget for we need. We
need every dollar, every ship, every plane, every shore station
that it funds. I've made some tough tradeoffs in this budget.
I've directed management efficiencies and administrative
reductions totaling over $100 million. But I cannot afford to
cut any more without jeopardizing our most valuable service to
the nation--front line operations.
So, thank you for this opportunity to come up here and tell
you about our needs and our challenges, and I look forward to
answering your questions.
[The prepared statement of Admiral Papp follows:]
Prepared Statement of Admiral Robert J. Papp, Jr.,
Commandant, U.S. Coast Guard
Introduction
Good morning, Mr. Chairman and distinguished members of the
Subcommittee. Thank you for the continuing support you have shown to
the men and women of the United States Coast Guard.
I am here today to discuss the Coast Guard's Fiscal Year (FY) 2012
Budget Request. I would also like to take this opportunity to discuss
the Coast Guard's value and role, some of our recent operations,
including our response to the BP Deepwater Horizon Oil Spill, and the
current budget environment.
For more than 220 years, the U.S. Coast Guard has safeguarded the
Nation's maritime interests and natural resources in our rivers and
ports, along our coasts, and upon the high seas throughout the world.
Over the past year, Coast Guard men and women--active duty, reserve,
civilian and auxiliarists alike--continued to deliver premier service
to the public. They saved over four thousand lives, protected our
borders by stopping the flow of drugs and illegal migrants, and
performed admirably in response to the Deepwater Horizon oil spill.
The Coast Guard is an adaptable, responsive, military force of
maritime professionals whose expansive legal authorities, geographic
diversity, and robust partnerships enable it to perform a broad range
of challenging maritime missions.
The Coast Guard's value and role:
We protect those on the sea: leading responses to maritime
disasters and threats, ensuring a safe and secure maritime
transportation system, preventing incidents, and rescuing those
in distress.
We protect America from threats delivered by sea: enforcing
laws and treaties, securing our ocean resources, and ensuring
the integrity of our maritime domain from illegal activity.
We protect the sea itself: regulating hazardous cargo
transportation, holding responsible parties accountable for
environmental damage and cleanup, and protecting living marine
and natural resources.
The Coast Guard, working through DHS, led the Administration's
response to the BP Deepwater Horizon oil spill, the first-ever Spill of
National Significance. On the night Mobile Offshore Drilling Unit
(MODU) Deepwater Horizon exploded, it was the Coast Guard who was first
on scene, searching for those in distress and providing a Federal
presence. Days later, when the oil began to gush from the damaged
wellhead, the Coast Guard surged over 7,000 people, including members
of the Coast Guard Reserve and Auxiliary, to combat the spill. Coast
Guard members served in cutters and boats, in fixed and rotary-wing
aircraft, and in the shore-side incident command system. The Coast
Guard also leveraged its many partnerships to support the response. The
Coast Guard's adaptive operational model allowed for the:
Rapid establishment of a response organization to combat the
spill, resulting in the recovery of 34.7 million gallons of
oil-water mix, and in-situ burning of 11 million gallons of
oil. These efforts assisted in the protection of the shoreline
and wildlife.
Deployment of 46 cutters and 22 aircraft. Surface assets
included Medium Endurance Cutters (210-ft and 270-ft), Sea-
going and Coastal Buoy Tenders (225-ft and 175-ft), Ice
Breaking Tugs (140-ft) and Patrol Boats (179-ft, 110-ft and 87-
ft). Air assets included Long and Medium-range Surveillance
Aircraft (HC-130 and HC-144A) and Short and Medium Range
helicopters (HH-60 and HH-65).
While 2010 was another exceptional ``operational year'' by any
standard, these operations further stressed existing aged and obsolete
cutters, boats, aircraft and support infrastructure. Moreover, these
extended surge operations strained workforce readiness due to increased
op-tempo and deferred training. It is therefore imperative--even in the
current fiscal environment--that we continue to invest in
recapitalizing our fleet and enhancing support to our families.
FY 2012 Request
In Fiscal Year 2012, the Coast Guard will focus resources to
advance strategic priorities. Through tough decisions and resource
trade-offs, the Coast Guard's FY 2012 budget leverages savings
generated through management efficiencies and offsets, and allocates
funding toward higher order needs that support front-line operations.
These offsets and reductions will support implementation of the
following FY 2012 budget priorities:
Rebuild the Coast Guard
Sustain Front-line Operations
Enhance Maritime Incident Prevention and Response
Support Military Families
Highlights from our request are included in Appendix I.
Rebuild the Coast Guard
The Coast Guard's FY 2012 budget requests $1.4 billion to continue
recapitalization of cutters; boats; aircraft; Command, Control,
Communications, Computers, Intelligence, Surveillance, and
Reconnaissance (C4ISR) systems; and infrastructure to improve mission
readiness by replacing aged, obsolete, and unreliable assets. The FY
2012 budget requests funding for 40 Response Boats and six Fast
Response Cutters, as well as a sizable investment in the renovation and
restoration of shore facilities. This budget also provides resources to
ensure that the Coast Guard's aviation fleet is mission-ready through
the acquisition of two Maritime Patrol Aircraft, one HH-60 helicopter,
and conversion and sustainment projects of multiple aircraft.
Investment in Coast Guard recapitalization is essential to mission
execution.
Sustain Front-line Operations
To ensure the Coast Guard is able to meet the needs of the Nation,
the FY 2012 budget balances resources between investments in capital
assets, initiatives to sustain front-line operations, and measures to
enhance mission execution. The FY 2012 budget requests $67.7 million to
operate new assets delivered through recapitalization programs and
provides funding to support personnel and in-service assets. Moreover,
funding is included to operate CGC HEALY and support the operational
reactivation of CGC POLAR STAR. The Coast Guard plans to decommission
CGC POLAR SEA in FY 2011 and transition her crew to CGC POLAR STAR,
enabling orderly transition to CGC POLAR STAR and facilitating her
return to operations in FY 2013.
Enhance Maritime Incident Prevention and Response
Coast Guard Marine Safety and Environmental Response personnel
promote safe and efficient travel, facilitate the flow of commerce in
the maritime domain, and protect our natural resources. The FY 2012
budget requests $22.2 million to advance implementation of the Coast
Guard's Marine Safety Performance Plan and Marine Environmental
Response Mission Performance Plan.
During the response to the Deepwater Horizon oil spill, Coast Guard
incident responders established and executed the Incident Command
System to lead an effective, unified effort. The Coast Guard will
enhance these core competencies in FY 2012 to keep pace with an ever-
growing and evolving maritime industry and ensure continued proactive
leadership to prevent disasters on the Nation's waters and remain ready
to respond if they occur. Additionally, funding requested in the FY
2012 budget will assist in meeting Coast Guard Authorization Act of
2010 requirements regarding dockside examinations by adding examiners
to improve fishing vessel safety.
Support Military Families
The Administration is committed to improving the quality of life
for military members and their families. The health and welfare of
families is the heart of operational readiness. The FY 2012 budget
includes $29.3 million to address critical housing shortfalls and
improve access to affordable, quality childcare. These initiatives will
ensure Coast Guard members are Semper Paratus for all hazards and all
threats.
Conclusion
The demands on the Coast Guard remain high. As we have for over 220
years, we remain ready to meet the Nation's many maritime needs
supported by the FY 2012 request. We will always fulfill our duties and
obligations to the American people, true to our motto ``Semper Paratus,
Always Ready.'' I request your full support for the President's FY 2012
request. Again, thank you for the opportunity to testify before you
today. I am pleased to answer your questions.
______
Appendix I--Fiscal Year 2012 Budget Request
Rebuild the Coast Guard
Surface Assets
$642M (0 FTE)
The budget provides $642 million for surface asset recapitalization
and sustainment initiatives, including:
National Security Cutter (NSC)--The NSC is replacing the
High Endurance Cutter class.
Offshore Patrol Cutter (OPC)--Sustains initial acquisition
work and design of the OPC. The OPC will replace the Medium
Endurance Cutter class to conduct missions on the high seas and
coastal approaches.
Fast Response Cutter (FRC)--Provides production funding for
six FRCs to replace the 110-ft Island Class Patrol Boat.
Response-Boat Medium (RB-M)--Provides production funding for
40 boats.
Medium Endurance Cutter (MEC)--Provides for operational
enhancement of five MECs at the Coast Guard Yard through the
Mission Effectiveness Program.
Air Assets
$289.9M (0 FTE)
The budget provides $289.9 million for the following air asset
recapitalization or enhancement initiatives, including:
MH-60T--Replaces one Jayhawk lost in an operational crash in
2010.
HC-144--Funds production of two Maritime Patrol Aircraft and
procurement of up to five Mission System Pallets and associated
spare parts to complete outfitting of the fleet.
HH-60--Funds service life extension and component upgrades
for eight aircraft.
HH-65--Funds sustainment of key components.
HC-130H--Funds Avionics Upgrade and Center Wing Box (CWB)
replacements.
Asset Recapitalization--Other
$166.1M (0 FTE)
The budget provides $166.1 million for the following equipment and
services:
Command, Control, Communications, Computers, Intelligence,
Surveillance, and Reconnaissance (C4ISR)--Deploys standardized
C4ISR capability to newly fielded NSCs and MPAs, and develops
C4ISR capability for the OPC. Interoperable and integrated
C4ISR is essential to the efficient and effective operation of
these assets.
CG-Logistics Information Management System (CG-LIMS)--
Continues development and prototype deployment to Coast Guard
operational assets and support facilities.
Rescue 21--Completes deployment at Sectors Lake Michigan,
San Juan, PR, Honolulu, HI, Guam; and continues replacement of
legacy VHF systems in the Western Rivers.
Interagency Operations Center (IOC)--Deploys Watchkeeper
Information Sharing capability to three IOC locations.
Commences deployment of the sensor management capability;
resulting in improved capability to see, understand, and share
tactical information critical to security and interagency
coordination in vulnerable ports and coastal areas.
Shore Units and Aids to Navigation (ATON)
$193.7M (0 FTE)
The budget provides $193.7 million to recapitalize shore
infrastructure for safe, functional and modern shore facilities that
effectively support Coast Guard assets and personnel:
Cape May, NJ--Replaces a condemned pier critical to
execution of patrol boat missions.
Corpus Christi, TX--Implements Sector/Air Station Corpus
Christi consolidation in order to properly hangar, maintain,
and operate MPA and an enhance mission effectiveness.
Chase Hall Barracks, New London, CT--Continues renovations
at the Coast Guard Academy by modernizing cadet barracks.
Commences construction of the #3-6 FRC homeports, C4ISR
training facility, and continues modifications to Air Station
Miami to accommodate new MPA.
Station Memensha Boathouse, Chilmark, MA--Replaces the
boathouse destroyed by a fire in July 2010 essential to
supporting coastal law enforcement, security and safety
operations.
TRACEN Petaluma, CA Wastewater Treatment Plant--
Recapitalizes and expands the capability of the Wastewater
Treatment Plant to ensure compliance with environmental
regulations.
Station Fairport, Ohio--Recapitalizes multi-mission boat
station, originally constructed in 1918, to facilitate current-
day operations.
ATON Infrastructure -Improves short-range aids and
infrastructure to promote the safety of maritime
transportation.
Personnel and Management
$110.2M (794 FTE)
The budget provides $110.2 million to provide pay and benefits for
the Coast Guard's acquisition workforce. The budget includes additional
resources to support the government-wide Acquisition Workforce
Initiative to bolster the professional development and capacity of the
acquisition workforce.
Sustain Front-line Operations
Pay & Allowances
$66.1M (0 FTE)
The budget provides $66.1 million to maintain parity of military
pay, allowances, and health care with the Department of Defense (DOD).
As a branch of the Armed Forces of the United States, the Coast Guard
is subject to the provisions of the National Defense Authorization Act
(NDAA), which includes pay and personnel benefits for the military
workforce.
Annualization of Fiscal Year 2011
$53.9M (194 FTE)
The budget provides $53.9 million to continue new initiatives begun
in the prior year, including increased counternarcotics enforcement
through enhanced Law Enforcement Detachment (LEDET) capacity and
follow-on funding for new assets (e.g., NSC, FRC, MPA, etc.).
Surface and Air Asset Follow-on
$50.8M (220 FTE)
The budget provides a total of $50.8 million to fund operations and
maintenance of cutters, boats, aircraft, and associated subsystems
delivered through major cutter, aircraft, and associated C4ISR
acquisition efforts. Funding is requested for the following assets:
RB-M--Funding for maintenance, repair and operational costs.
FRC--Operating and maintenance funding for FRCs #6-8 and
funding for crews #9-10. These assets will be homeported in
Miami and Key West, FL. Funding is also requested for shore-
side maintenance personnel needed to support FRCs.
NSC--Signals Intelligence Capability follow-on and Crew
Rotational Concept implementation for three NSCs located in
Alameda, CA.
HC-144A MPA--Operating and maintenance funding for aircraft
#14; support and maintenance of Mission System Pallets 1-12.
C4ISR Follow-on--Funding to maintain more than 200 C4ISR
systems deployed and delivered by the Coast Guard C4ISR
Program.
Helicopter Systems--Funding to operate and maintain
communications and sensor systems for HH-60 and HH-65
helicopters.
Asset Training System Engineering Personnel--Funding to
support NSC and FRC training requirements at Training Center
Yorktown.
Polar Icebreaking Program
$39M (180 FTE)
The budget requests $39 million in polar icebreaking budget
authority. Funding will support the operation and maintenance of CGC
HEALY and prepare for the operational reactivation of CGC POLAR STAR.
The Coast Guard plans to decommission CGC POLAR SEA in FY 2011 and
transition her crew to CGC POLAR STAR, enabling efficient transition to
CGC POLAR STAR and facilitating her return to operations in FY 2013.
Critical Depot Level Maintenance
$28.7M (0 FTE)
The budget provides $28.7 million for critical depot level
maintenance and asset sustainment for vessels, aircraft, and shore
infrastructure. Funding will increase support levels for the 140-, 175-
, and 225-foot classes of cutters, restore aircraft spare parts and
provide sustainment for aging shore infrastructure.
Distress Alerting Satellite System (DASS)
$6.3M (1 FTE)
The budget provides $6.3 million to begin replacement of the Search
and Rescue Satellite Aided Tracking (SARSAT) system with the Distress
Alerting Satellite System (DASS). This multi-agency partnership also
includes the National Aeronautics and Space Administration (NASA), the
National Oceanic and Atmospheric Administration (NOAA), the U.S. Air
Force (USAF). Recapitalization of the SARSAT system beginning in FY
2012 is critical to ensure no loss of coverage in distress notification
and life saving response during the planned deactivation of the legacy
SARSAT system.
Coast Guard Network Security
$8.6M (0 FTE)
The budget provides funding for the Coast Guard to transition from
its commercially provided Internet Access Points (IAPs) to DOD IAPs via
the Defense Information Systems Agency (DISA) to ensure security of
vital networks and meet cyber security requirements.
Enhance Maritime Incident Prevention and Response
Marine Safety Enhancement
$10.7M (53 FTE)
The budget provides $10.7 million and 105 personnel to implement
the next segment of the Marine Safety Performance Plan by investing in
Marine Safety Inspectors, Investigators, and Fishing Vessel Safety
Examiners at Coast Guard Sectors. This initiative furthers the Coast
Guard's efforts to achieve an appropriate mix of military and civilian
personnel with the necessary skill-sets and experience to perform
Marine Safety inspections and investigations.
Marine Environmental Response Enhancement
$11.5M (44 FTE)
The budget provides $11.5 million and 87 personnel to enhance
Marine Environmental Response (MER) capacity. This initiative supports
the Marine Environmental Protection Mission by providing funding for an
MER Incident Management and Assist Team (IMAT) and increasing technical
expertise and strengthening MER career paths at Coast Guard Sectors and
Strike Teams. The request is the initial investment in the Coast
Guard's initiative to improve mission performance in accordance with
the MER Mission Performance Plan.
Support Military Families
Child Development Services
$9.3M (6 FTE)
The budget provides $9.3 million to increase access to child care
services for Coast Guard families with dependents under the age of 12,
better aligning the Coast Guard with the Department of Defense (DOD)
child care standards. Additionally, this request funds 12 new positions
critical to ensuring continued accreditation of the Coast Guard's nine
child development centers by the National Association for the Education
of Young Children.
Military Housing
$20.0M (0 FTE)
The budget provides $20.0 million to build family housing units at
Sector Columbia River and recapitalize the Air Station Cape Cod
Unaccompanied Personnel Housing, the highest priority housing projects,
critical to the well-being of military personnel and their families
assigned to these geographic regions.
Decommissionings, Efficiencies, and Savings
High Endurance Cutter Decommissioning
-$6.7M (-92 FTE)
As part of its long-term recapitalization plan, the Coast Guard is
decommissioning HECs as NSCs are delivered and made operational. The
average age of the HEC fleet is 43 years and these assets are failing
at an increased rate resulting in lost operational days and increased
maintenance costs. The Coast Guard will decommission one High Endurance
Cutter (HEC) in FY 2012.
PC-179 Patrol Coastal Decommissioning
-$16.4M (-108 FTE)
The three remaining 179-foot Patrol Coastal (PC) vessels will be
decommissioned per a January, 2007 Memorandum of Agreement (MOA) with
the U.S. Navy. These vessels will be returned to the U.S. Navy in FY
2012.
Standard Workstation Help Desk consolidation
-$6.9M (0 FTE)
Consolidates computer workstation support into two regional
centers, eliminating 56 contractors.
Program Support Reduction
-$13.6M (0 FTE)
Reduction in programmatic support across the Coast Guard including
support reductions for: small boat replacement, reservist and contract
support for audit remediation, innovation program funding, recruiting,
and training opportunities.
Administrative Savings Initiatives
In FY 2012 the Coast Guard will seek efficiencies and make targeted
reductions in order to sustain front-line operational capacity and
invest in critical recapitalization initiatives.
Management Efficiencies
-$61.1M (0 FTE)
Consistent with the Secretary of Homeland Security's Efficiency
Review and building upon efforts in previous Fiscal Years, efficiencies
will be generated by leveraging centralized purchasing and software
licensing agreements, reductions in printing and publications,
reductions in shipping and the transportation of things, reductions in
advisory and assistance contracts, minimizing purchases of supplies and
materials, office equipment consolidation, implementing automation and
energy conservation/savings measures, and limiting government usage of
commercial facilities.
Professional Services Reduction
-$15.2M (0 FTE)
A reduction in professional services contracts for enterprise-wide
mission support and operational support activities.
Non-Operational Travel Reduction
-$10.0M (0 FTE)
A 25 percent reduction in Coast Guard-wide non-operational travel,
including travel for training, professional development, conferences,
and international engagement.
Senator Begich. Thank you very much, Admiral Papp.
What we'll do on this first round of questioning is do
about 5 minutes each. And we'll, if I can start with a couple.
And, I guess the first is the broader question--First, just
a side note on, because I didn't have this in any of my notes,
and you made me think of something here. Can you tell me again,
the mission in Iraq, what the Coast Guard has there? Just so I
understand that mission.
Admiral Papp. Yes, sir. The initial mission was to provide
coastal patrol boats to guard the Iraqi oil platforms.
There are two platforms that sit very close to the border
with Iran. They are, they have been--in fact, we lost one Coast
Guard member in an attack on those oil platforms. The oil
platforms provide about 90 percent of the revenue for the
country of Iraq, so they can't afford to lose them.
Iraq, after the war, did not have the capacity to protect
them, so we've been in the process of providing patrol boats,
and the Navy and the Marine Corps were providing people on the
platforms themselves. The Iraqis are transitioning to taking
over the protection of the oil platforms, and Navy Central
Command has asked us to continue to provide the patrol boats.
We've received overseas contingency funding for that
through the Navy, to sustain that. And we intend at this point
to continue meeting the Navy's needs over there, because they
don't have the capacity, or the types of boats that are
necessary for this.
Senator Begich. You, your second part of that answer was
exactly where I was headed, was--and it sounds like the Navy's
contingency money is utilized to help offset your costs. Is
that right?
Admiral Papp. Yes, sir. And it has been transferred to us
two different ways. It has come either directly from the Navy--
last year it was actually put in our budget. The OCO funding
was put in our appropriation.
Senator Begich. Good. Let me ask you some general
questions, if I can. First, I understand, and, on the POLAR
SEA, which will be decommissioned this year, and the POLAR STAR
won't come out until 2013, is there any advantage in putting
the POLAR SEA in kind of a warm status while we're in this
process of trying to get to 2013?
Admiral Papp. Mr. Chairman, the entire budget is a
balancing act, trying to sustain capabilities, trying to
recapitalize. There's good news and bad news about this
icebreaker situation. The bad news has been, the Coast Guard
didn't have the money in our budget to sustain the icebreakers,
and I think that's part of the reason we find ourselves where
we are.
The good news is, we're getting the money back in our
budget, but the President's proposed budget only gives us money
to sustain POLAR STAR--the one that's in reactivation right
now--and HEALY, our medium icebreaker, which is fully active.
We had to make some very tough decisions within the limited
amount of money we have, and in my judgment, the best thing is
to decommission POLAR SEA, and devote all our resources into
POLAR STAR, so that we can get another, hopefully, 10 years at
least out of POLAR STAR until we come up with a long-term
solution to our Nation's icebreaker solution.
Senator Begich. If you had the resources, would there be a
value with the POLAR SEA, to put it in a warm status, or at
least have a capacity?
Admiral Papp. I----
Senator Begich. Or, is it just too far gone that it's not--
--
Admiral Papp. Oh, no, sir. POLAR SEA is in a sound
condition right now, with the exception of her engines. There
was a major engine overhaul that was done which failed. So
right now, rather than invest in Polar Sea to restore all those
engines, we're transferring that money and funding over to
POLAR STAR because we think--I think that's the best investment
at this time.
Senator Begich. OK.
Admiral Papp. In an unconstrained resource environment, I'd
love to have the money to keep POLAR SEA going as well. The
hull is sound. The engines need to be overhauled, and I think,
at a minimum, I believe at a minimum--this is my personal
opinion--the country needs at least two heavy icebreakers.
Studies show us, varying numbers, that the Nation should have.
If I had all the money I wanted to have, I would certainly keep
POLAR SEA going. But I'm faced to make some tough decisions in
this budget.
Senator Begich. Could you at some point--not right now, but
maybe get me an analysis of what that would take, to take the,
next, as for engines?
Admiral Papp. Yes, sir.
[The information requested follows:]
Approximately $14-15 million non-recurring funding to complete the
necessary Hull, Mechanical & Electrical (HM&E) work and an additional
$30 million annual recurring funding for crewing and asset Operations &
Maintenance (O&M) are required to return POLAR SEA to operational
status. Operational status is defined as the ability of the cutter to
deploy for a polar mission. Based on the most recent long lead time
parts delivery dates, it is estimated that this work would
approximately 24 months to complete from the receipt of funding.
Required HM&E work to return POLAR SEA to operational status would
entail:
Main Diesel Engine Repairs: $4.5 million
Machinery Control And Monitoring System Upgrade: $1.0
million
Central Hydraulic System Removal and Cargo Crane Renewal:
$4.0 million
Miranda Davit Install: $1.5 million
Open Loop CPP System Conversion: $3.16 million
Bringing POLAR SEA to operational status would also have
significant impacts to the current POLAR STAR reactivation project due
to limited supply of critical parts and long production timelines for
diesel engine parts that would have to be allocated across both assets.
Additionally, the specialized workforce necessary to reconfigure the
engines would also have to be balanced across both assets. The required
work listed above would return POLAR SEA to operational status but
would not significantly enhance reliability. POLAR SEA's projected end
of service life would remain at the end of 2014, which means escalation
of reliability concerns and maintenance costs would continue unless a
Service Life Extension Project (SLEP) was performed.
Senator Begich. OK. Also, you have done, or, you, the Coast
Guard has done a High Latitude Study, basic, for Alaska. Can
you tell me the status and where that's at? I know there's
great debate, and I know you've done surveying and so forth,
and some testing up in the north. Can you tell us what the
status of that is, and when we might see that report?
Admiral Papp. We're----
Senator Begich. Or, will we see that report? Let me ask you
that.
Admiral Papp. Yes, sir.
Senator Begich. Good.
Admiral Papp. I'm very optimistic right now. If you'd asked
me a couple months ago, perhaps not as optimistic. But, right
now, we're working with the administration, developing a cover
letter that will go on all three volumes. And I expect that
that will be released sometime before the fall so that we can
fully analyze it.
Senator Begich. Let me end there with my questions. I have
some more, so maybe on the second round. But, I want to let you
know, in the state legislature in Alaska, they've allocated I
think just shy of $2 million. We'll see if the Governor vetoes
it or not. But, if it stays it, it is to start examining
deepwater ports up in the northern region, which I think could
be complementary to the efforts that you want to do, and maybe
some local dollars to assist. So, I just want to flag that. I
told them the same thing. Based on the study, we may want to
explore some opportunities with their resource, too.
Admiral Papp. Yes, sir. I'd love to talk more about Arctic
infrastructure. Yes, sir.
Senator Begich. Excellent. That's my second round comment,
so don't worry.
Senator Ayotte.
Senator Ayotte. Thank you, Mr. Chairman.
Admiral, I had a brief follow-up on the mission that you're
conducting in Iraq right now, of providing security for the oil
platforms that are critical to the Iraq economy.
I also serve on the Armed Services Committee, and from the
testimony we've had before that committee from our military
leaders over the last several months, there has been concern
expressed about the withdrawal date at the end of December for
our military.
Do you know, would you be included in that withdrawal date
in terms of Coast Guard operations of guarding those platforms?
Admiral Papp. We would not be included. That doesn't
include all military. Central Command--and I've talked to
General Mattis about this. They have an ongoing need for our
niche capabilities.
The Iraqis--there are two levels of defense. There's the
people on the platforms themselves; then there are the patrol
boats that, they guard the perimeter. And while the Iraqis have
bought patrol boats, their crews have not been trained to the
level where they're able to take it over right now. So, the
Central Command has sustained their request, or, kept their
request going for us to keep our patrol boats over there to
fill that niche. And I expect that that funding will keep,
continue coming.
Senator Ayotte. So, you would anticipate, Admiral, that the
important security function that the Coast Guard is performing
would actually go. Because, as you know, the agreement we have
with the Iraqi government, which, I think there have been some
discussions about perhaps extending, because we've heard on
several fronts that they're--not just in this area, but in
other areas, they're just not quite ready in some instances to
take over their own security. So, in your opinion, your mission
would extend, regardless of those agreements?
Admiral Papp. Yes, ma'am. That's true. The Central Command,
even though we're pulling forces out of Iraq, the Central
Command, of course, has ongoing missions there in the Arabian
Gulf region----
Senator Ayotte. OK. Thank you very much, Admiral. I
appreciate that.
And then, the other follow-up I had is, I appreciate that
the Coast Guard falls underneath the Department of Homeland
Security, as opposed to the Department of Defense. The
President announced not too long ago that he was going to ask
Secretary Gates, and now Secretary Panetta, to look at--as you
know, Secretary Gates undertook an efficiency initiative, just
as you've described that you've done in the Coast Guard
budget--that he would be looking at, perhaps, as much as $400
billion of additional cuts.
Has there been discussion of whether the Coast Guard would
be part of that analysis? Or would you be separate? I didn't
know if you had already been asked to look at that. Because
it's obviously a pretty significant level of cuts to our
Defense over the 10-year period.
Admiral Papp. Senator, that's a great question. And this is
where people like you, that maintain these relationships
between Armed Services and our authorization committee are very
important. Because a lot of people don't understand that the
National Defense Authorization Act, which governs military pay,
benefits, et cetera, applies to the Coast Guard as well. And
sometimes people forget that as we go along. So, there are
impacts on the Coast Guard budget that are determined by
decisions made by the Armed Services Committee.
The good thing is that--and this is one of the beautiful
things about the Coast Guard--is, we provide a bridge between
the Department of Homeland Security and the Department of
Defense. I sit in on all the Joint Staff meetings. I was over
there on Tuesday sitting in with all the service chiefs,
Chairman Mullen, and the combatant commanders, and addressing
these efficiencies that are being developed, and analyzing the
impacts on the Coast Guard as well--and also being mindful of
what the Department of Defense may not be able to provide back
to Homeland Security in the future, as we go through these
budget reductions over the next dozen years or so.
Senator Ayotte. Well, I do appreciate that you are being
included in those discussions, because you obviously perform a
very important defense function for our nation as well. And
thank you for providing that insight on the relationship
between what we are doing in the NDAA and the Coast Guard.
One of the things I look forward to hearing from you going
forward, serving on both committees, is, I also am the Ranking
Member on the Readiness Subcommittee on the Armed Services
Committee. I just want to make sure that we don't get in a
position that we have been in, in prior times in our Nation's
history, where, when we are drawing down, for example, from
Iraq and Afghanistan, that we don't hollow out the forces in a
way that jeopardizes our readiness for protecting our country.
So, these are issues that I look forward to continuing to
talk with you about. I'm very glad that you're being included
in those discussions.
Admiral Papp. Yes, ma'am. Thank you.
Senator Ayotte. Thank you.
Senator Begich. Senator Lautenberg.
Senator Lautenberg. Mr. Chairman, and Admiral, if I can
stop the coughing, I'll finish my questioning. But if I don't,
I'll ask you to respond to my questions via the
communications----
Admiral Papp. Yes, sir.
Senator Lautenberg.--list and respond that way.
It's peculiar for me to be talking about the aging ships
that are only 40 years old.
[Laughter.]
Senator Lautenberg. And we had the privilege of
inaugurating the services of the, I think one of the last
cutters built in Rhode Island at the very famous yard there. My
daughter and I gave a present to the Seaman of the Year that is
on a constant basis. But, anyway, I've got the Semper, but I'm
not sure I've got the Paratus today.
So, House Republicans dangerously slashed funding that
would support port securities by 55 percent below this year's
level. According to the FBI, New Jersey, as I mentioned, is
most at-risk, the most at-risk area for a terrorist attack in
the United States.
What kind of an impact would cuts to port security grants
have on security efforts at high risk ports, like the Port of
New York and New Jersey?
Admiral Papp. Well, as you know, Senator, I don't control
the money for the port security grants. That ultimately ends up
with FEMA. But, we do have a chance to comment on those at our
Captain of the Port level. As the ports prepare their proposals
for funding through the grants, our Captain of the Ports add
comments to that, and sort of rank order them as they go along.
I know there's some concern, particularly in the Port of
New York--I just got a letter from Commissioner Kelly that I'm
responding to right now. He has some concerns about the
shortfalls there.
What I can say is that, I think, part of the strength is
that we are all working together. We all are communicating
together. Our Captain of the Port up there meets with the Area
Maritime Security Committee, brings all those people together.
And increasingly, as we go along in these constrained budget
times, we're going to have to rely upon our partnerships to be
force multipliers up there. And I think the Port of New York,
in particular, has a very strong partnership. And I'm
comfortable where we're at in terms of the resources for
providing security there.
Senator Lautenberg. All right. I just don't want cuts to
impair the vigilance that's required there.
So, we noted that reports discovered at Osama bin Laden's
compound reveal that al-Qa'ida discussed plans to attack oil
tankers bound for U.S. ports. Now, what does the Coast Guard do
to respond with additional measures to secure our ports in
light of these new threats?
Admiral Papp. Well, sir, we use a layered security effort.
It starts overseas. We have--the three layers are basically,
regulatory, and cooperation with other countries
internationally, and placing inspectors from the Coast Guard
that inspect the security efforts' compliance with an
international ship and port security code in the ports if they
are going to trade with our country. That's our first layer of
defense--making sure that other countries are applying the
right security efforts overseas.
Then you have an intermediate layer, which are our major
cutters--the high endurance, medium endurance cutters that I
was talking about--that can range out to the limits of our
exclusive economic zone, intercept ships coming in, and provide
escorts or boardings for security before the ships arrive at
our ports.
And then finally, the last layer is our coastal patrol
boats, our stations, our deployable specialized forces that we
can move around from port to port, that provide the security
within the ports themselves.
The first and third layer I'm comfortable, confident with,
and we have, I think, resourced properly. The challenge we face
are those ships that should be out there with a persistent
presence that are now approaching 40 years old. And I
understand your comment, sir. And oftentimes we throw this
thing about them being 40 years old or 50 years old out there,
and most Americans, they don't have a context for understanding
there.
Senator Lautenberg. Absolutely.
Admiral Papp. And what they need to know is that
engineering-wise, these ships were designed to go about a
quarter century, and we've far exceeded that. The example I
like to use is, my home, which I bought 20 years ago, and I'm
replacing heating systems, I'm replacing air conditioners, I'm
replacing wiring, and other things that--and a roof, because of
20 years of use. Well, these ships have had 40 years of hard
use in a very unforgiving environment, doing some very
challenging things, and now we're losing effectiveness,
efficiency. They're falling apart. And we need better tools for
our people to provide that intermediate layer of security.
Senator Lautenberg. Are you prepared, if asked, to give
specifics, situations, that would really cause an impairment in
your ability to provide the services that are requested? There
are always new things, whether it's oil spills, trash dumping--
so many things that they, get--Mr. Chairman, that the Coast
Guard is asked to do. And they do it courageously, they do it
skillfully. And it's just a question of how much juice you can
squeeze out of a melon, without it, not having anything left.
And I want your people to understand one thing: They carry
enormous pride for our country, though not as visible as some
of the other services. But the fact that you are really Semper
Paratus, that you're there, always ready. And it amazes me
that, whatever the crisis is, somehow or other the Coast Guard
finds a way to get there. And I salute you, and I ask, tell
your people that, keep up the good work, and let's us try and
do what we can to provide you with the resources that are
necessary.
Thank you very much for being here.
Admiral Papp. Thank you, Senator.
Senator Begich. Thank you very much, Senator Lautenberg.
I'm going to ask just a couple quick questions, and then
I'm going to turn it over to the Ranking Member for her opening
statement and questions that she may have.
So, Admiral Papp, I have one--I'm sitting here as you were
commenting to Senator Ayotte, you know, I sit on Homeland
Security, I'm here in Commerce, and Department of Defense Armed
Services. So, it's kind of an interesting--you're right. You
are a kind of a bridge between all this. And it's interesting
to see that.
Let me, you know, Homeland Security in their budget--and
I'm not going to, I don't want to put you too much in a box
here--but, if feel uncomfortable answering, just tell me. But,
they've asked for another $5 million in their 2012 budget to
study icebreakers, the need of icebreakers.
You know, what I've learned about the Federal Government--
we study a lot of stuff, and then we usually, 5 years later, we
study it again, because we got, the study is old, and we didn't
implement it. So, my gut tells me it's not worth the money; we
should put that into what we know. We know we need a minimum,
as you stated--and I think you're right on, I think minimum is
the right word--at least two operational, large-scale
icebreakers, at minimum.
Is it wise to put, to do another study on what our need is?
I understand--and I don't want to, you know, I don't want to
get you in any trouble here with Homeland Security, but I'm
just, it just seems like, there's $5 million sitting there to--
I know it's not a lot in the big picture, but $5 million to the
Coast Guard is a lot of hard cash you could put to operational
resources.
Admiral Papp. Well, Senator, I think when you see the High
Latitude Study, it's going to offer a range of options. And
oftentimes when you array the range of options, particularly
within a constrained budget time, it causes a lot of people to
choke. I mean, I've never seen any study over the course of my
career, which now spans about four decades, that does not call
for more Coast Guard.
Senator Begich. Right.
Admiral Papp. So, let's just accept the fact, or, I accept
the fact that we don't have enough Coast Guard to do everything
that we do. But, on the other hand, we have to be good stewards
of our country's money, as well. And it's tough to live within
the constraints that we have.
Having said that, I think the High Latitude Study will show
a need for a range of icebreakers.
Senator Begich. Yes.
Admiral Papp. Now you've got to decide--OK, what can the
country afford, what do we want to build, and who's going to
operate them? And so, I think the $5 million is probably well
spent if there is a focus for where that report would go. And--
--
Senator Begich. So would--if I can interrupt you for a
second. Very good. That's why you're the Commandant. And, let
me say, the Latitude Study, which is in process now, and just
really about to be released, can I say this, from what you've
just stated--that once we see that, it will draw multiple
conclusions and pathways, some small, some medium, some large,
where policymakers need to make a determination. Then the
question is, utilizing that $5 million to get it going,
whatever that pathway is, is really of a high value.
Now, I'm not going to use the word ``study'' here, because
what I am hearing you carefully say is that the High Latitude
Study will tell us a lot about icebreaker needs. At varying
pathways. The question is, then, in these limited dollars we
have, how do we utilize it? And our job here--and I'll just
say, is that 5 million worth an additional study to got one
step further? Or is it to say, this is the pathway, let's start
putting some money toward it and go down the track?
Admiral Papp. I think the----
Senator Begich. Is that a fair----
Admiral Papp. I think you're exactly right, sir.
Senator Begich. OK.
Admiral Papp. Clearly delineating where that money would
go, and what the end result should be, which is a clear and
definitive answer, what this Nation wants to do in terms of
recapitalizing its icebreaker fleet, or a decision that we're
not going to do it. But----
Senator Begich. Understood.
Admiral Papp.--we're behind the power curve right now in
terms----
Senator Begich. Absolutely.
Admiral Papp.--of taking action.
Senator Begich. And I know you've done this for my staff.
It's--or, one of your folks, some time ago. And I'm wondering
if you could do this for the Committee. And my bet is, I'm a
sure a committee staff will lean over and say, ``We have that
already.'' But, just in case, I'll just echo it again. As
you've talked about all the different ship needs you have, is
there a simple spreadsheet, you know, an Excel spreadsheet, or
some sort of spreadsheet that says, here's what we have, here's
what's going to replace, and here's what we need, which is
going to show a gap, is my bet. And if that hasn't been
produced, maybe that's a later discussion. But, at least those
first two columns by class, and then how long it takes. Because
I know on one of them there is a lay of the land of how it
looks long-term. But, the real question is that next column.
And I know that's one that, knowing--I've worked in the
administration before, not the Presidential here, but in the
mayor's office when I was mayor, we always do that last column.
It doesn't necessarily show up in the legislative body process,
because OMB takes it off and says, don't talk about that. So,
can you do at least those two? And maybe the third we could
have a discussion on at some point?
Admiral Papp. Oh, absolutely. And I think----
Senator Begich. You understand what I'm asking for.
Admiral Papp. Yes, sir. I certainly do.
Senator Begich. OK.
Admiral Papp. And, column 1 and column 2 are very easy to
come up with. Column 1--column 2 is going to be less than what
column 1 is.
Senator Begich. Yes.
Admiral Papp. And certainly, column 3 would be much more.
Senator Begich. Right.
Admiral Papp. And, I think that's the challenge. We've
done, in fact, we're in the midst right now, the Department has
asked us to do a cutter study to sort of refocus the balance of
ships that we're building right now. And it's one of those
things, and once again, even if you give it to a third party,
the numbers that you come up with to have the Coast Guard do
all of its jobs all the time----
Senator Begich. Right.
Admiral Papp.--are something to choke on.
Senator Begich. Yes. I----
Admiral Papp. And I think that's why we have a hard time
gaining traction, getting these reports forward. They always
come back showing we need more.
Senator Begich. Right.
Admiral Papp. So, the challenge I'm faced with is, I've got
a top line at the end of the day that I've got to fall within,
and we're doing our best top meet that. And that's why we need
sustained funding in our acquisitions.
Senator Begich. Well, if you could do that, I'd love the
third column. And then, if OMB harasses you or whatever, you
can say we asked for it.
Admiral Papp. Yes, sir.
Senator Begich. Because I really, I think that's, for us
it's important to see that. Now, it may not mean we ever get
there. But if we don't know what that--to do what you're
required to do, as Senator Lautenberg laid out, we need to know
what resources you need, and then we have to make a broader
policy discussion in our budgets of what's the right
allocation. But if we don't know what that end is, we don't
know if we're really fully, if we're at 70 percent of your
mission, 60 percent, 80 percent. So, if you could provide that
to the Committee, that would be great.
Admiral Papp. Yes, sir.
[The information requested follows:]
The information requested is provided in the table below.
----------------------------------------------------------------------------------------------------------------
Quantity Planned
Legacy Assets Before Quantity at the Current Quantity Major Replacement Assets When Deepwater is
Deepwater Program Started End of FY 2001 as of June 2011 (A) Completed (B)
----------------------------------------------------------------------------------------------------------------
Surface
----------------------------------------------------------------------------------------------------------------
High Endurance 12 10 National Security 8
Cutter (378) Cutter (NSC)
----------------------------------------------------------------------------------------------------------------
Medium Endurance 1 1
Cutter (282)
-----------------------------------------------------------------
Medium Endurance 13 13
Cutter (270)
-----------------------------------------------------------------
Medium Endurance 1 0 Offshore Patrol Cutter 25
Cutter (230) (OPC)
-----------------------------------------------------------------
Medium Endurance 1 0
Cutter (213)
-----------------------------------------------------------------
Medium Endurance 16 14
Cutter (210)
----------------------------------------------------------------------------------------------------------------
Patrol Boat (110) 49 41 Fast Response Cutter 58
(FRC)
----------------------------------------------------------------------------------------------------------------
Aviation
----------------------------------------------------------------------------------------------------------------
HC-130H Long-
22 Range Surveillance
HC-130H 30 Aircraft 22 (C)
----------------------------------------------
HC-130J Long-Range
6 Surveillance Aircraft
----------------------------------------------------------------------------------------------------------------
HH-60 Medium
HH-60 40 40 Range Recovery 42
Helicopter
----------------------------------------------------------------------------------------------------------------
HH-65 93 101 HH-65 Multi-mission 102
Cutter Helicopter
----------------------------------------------------------------------------------------------------------------
HU-25 41 13 Maritime Patrol 36
Aircraft (MPA)
----------------------------------------------------------------------------------------------------------------
Unmanned Aerial TBD
System (UAS)
----------------------------------------------------------------------------------------------------------------
Notes:
(A) Does not include Mission Effective Projects (MEP) for the Medium Endurance Cutters/Patrol Boats and Cutter
Boats.
(B) Based on Acquisition Project Baselines (APB).
(C) Combined LRS program of record--final mix of C-130H/C-130J TBD.
Senator Begich. Thank you.
Senator Snowe.
STATEMENT OF HON. OLYMPIA J. SNOWE,
U.S. SENATOR FROM MAINE
Senator Snowe. Thank you. Thank you, Mr. Chairman.
And, welcome, Admiral Papp. I am sorry that I wasn't here
for the opening of the Subcommittee session. Unfortunately, I
was called to testify on regulatory reform, and that was
important.
I appreciate, Mr. Chairman, your leadership, and for
convening this hearing to discuss the future of our nation's
most versatile branch, the Coast Guard.
And I welcome you, Admiral Papp, and your leadership.
As you know, from your visit there last year, prior to your
confirmation, I came from a state truly reliant on the ocean
for commercial and recreational uses. And so, the Coast Guard
becomes paramount in that regard.
You probably have already had a very frank discussion about
the administration's acquisition budget, which seeks 8 percent
less than in 2010, and an operations budget reflecting a 3.9
percent increase over last year, and whether or not that's
adequate to meet both the anticipated, as well as the
unpredictable, needs and requirements of an increasingly
complex maritime world. The Coast Guard is tasked with sweeping
mandates, and, as we well know.
In 2010 we were reminded again of the tremendous range of
the Coast Guard's capacity as it patrolled the nearly 3.4
million square miles of the exclusive economic zone. Last year
alone, the Coast Guard saved over 4,000 lives, inspected over
21,600 shipping containers, interdicted over 2,000 illegal
migrants, and prevented 300,000 pounds of illegal drugs and
millions of gallons of oil from reaching our shores.
And despite the Coast Guard's numerous successes, the
agency continues to confront the challenge of doing more with
less. And so, it is reminiscent of the past in so many
instances, where we've had to discuss the fact that the Coast
Guard has been asked to do so many things with a budget that's
truly constrained.
This budget reflects some significant points of concern,
including a $115 million reduction in the acquisition budget, a
$15 million reduction in defense readiness. In these
increasingly difficult economic times, government programs must
strive for maximum efficiency, but, hopefully, not at the
expense of the safety and security of our Nation.
Two thirds of the 2012 budget request would support
operating expenses, but the fact is, we have an aging fleet, so
long-term capital spending cannot be overlooked. The high
endurance cutters'--one of which would be decommissioned under
this budget proposal--the average age is 40 years.
In the future, the Coast Guard assets and personnel are
likely to be more often in demand, rather than less. Whether
it's piracy, environmental disasters, and growing security
responsibility in the Arctic, there are ongoing threats that
must be factored into the budget decisions. While the Coast
Guard has continued to fulfill these missions, we cannot expect
them to operate indefinitely with vessels approaching 30, 40,
and in some cases, even 50 years of service. I am sure you have
already touched upon this today, as well: for example, in the
Arctic, increasing shipping traffic, search and rescue
responsibilities, and resource exploration is demanding more of
the Coast Guard. Yet, polar ice breaking capacity has been
reduced to just one vessel, the HEALY, which was commissioned
in 1999--a vessel primarily intended to support scientific
research, rather than provide a heaviest ice breaking support
in the polar regions.
Admiral Papp, your agency's budget request appears to
strike a balance, meeting the Coast Guard's critical
operational requirements while reducing costs through
administrative efficiencies and offsets. But this committee
also needs to understand specifics from you regarding the
tradeoffs that also have been made in that regard. For example,
further delay in the delivery of the High Latitude Study means
more time will elapse before we're able to provide you with the
tools that you will require to respond to emerging issues, such
as resource claims and new passageways in the Arctic.
Painting that clear picture will also allow us to better
set priorities in how scarce resources are going to be spent.
Earlier this week, a Department of Homeland Security Inspector
General report outlined a series of violations that occurred
between 2004 and 2009 in the Response Boat- Medium acquisition
program. While it was a positive indication that the Coast
Guard detected the issue and initiated action in response, and
recognizing that these problems occurred prior to your watch,
Admiral, I raise this issue to underscore the point that, in
this budget climate, it becomes even more imperative that we
consider the impact of every dollar.
The common theme emerging is that for years we've asked the
Coast Guard to save American lives and natural resources on a
shoestring budget. The level of service we have received in
return for our investment, from the unprecedented response to
last year's oil spill, to the safety net of security that
blankets our nation's port, has been nothing short of heroic.
So, we cannot continue to heap mission upon mission onto the
Coast Guard without increasing its resources, and expect those
critical tasks to be carried out with the same degree of
effectiveness upon which we rely and depend.
So, I appreciate, Commandant, your leadership, and those of
the men and women in the Coast Guard, because they truly are a
remarkable force. And I appreciate all that you are doing.
Senator Snowe. Let me just follow up with a first question
on this report that was issued by the Inspector General. Can
you respond to it? We have had this issue in the past, prior to
your tenure, and I think it's very important to make sure that
we get this acquisition program on the mark. With the Coast
Guard Reauthorization Act, we did try to address many of the
issues that had occurred in the previous acquisition process.
I understand the acquisition workforce vacancies had been
reduced from 20 to 13, from April to November 2010. In April
2011, a GAO report found that within your agency, program
managers were concerned about not only the ability to fund
these positions, but also the ability to fill vacancies
depending on where they fall in the management structure.
Has this been addressed? And does it affect the acquisition
process for the Response Boat-Medium fleet?
Admiral Papp. Yes, ma'am. The analogy I like to make about
our acquisition workforce is, if you go back to the mid-90s,
where we were going through constant budget reductions every
year, part of the thing we did was, we gutted our acquisition
workforce. There wasn't the work for them to do, first of all,
and we couldn't afford to maintain them. We were only getting a
couple of hundred million dollars a year for acquisitions back
then.
After September 11, or, September 11, 2001, occurred, all
of a sudden we started building up, going up to three quarters
of a billion dollars, then over $1 billion. And so, it was like
trying to overhaul an engine in a race car while you're in the
middle of a race. We're bringing on new people, we're trying to
fill vacancies. And at the same time, every other agency in the
Washington, D.C. area was trying to hire acquisition
professionals, because everybody else was building up, as well.
It was a hard job for us. We know we made mistakes along
the way. Part of the reason we've done better is because of the
oversight of this subcommittee in putting the pressure on us to
make sure that we comply. And, as I sit before you here today,
I will tell you, I am very proud of our acquisition workforce.
I've seen the growth and development.
Five years ago, I was Chief of Staff of the Coast Guard. We
brought in then Rear Admiral John Currier, who headed up our
acquisitions. He got with the Defense Acquisition University.
We brought in experts. We hired people away from NAVSEA and
brought them in to--civilians--to bolster up our program. And
we're seeing the benefits of that right now.
Part of the, the down side of those benefits of getting a
professional workforce is, you start discovering things that
you did wrong. And we self-reported on this ADA violation
because it's the right thing to do. We took corrective action
on it, and I'm hopeful that it will not happen again. But, as I
talk to some of our old professionals that have been with us
for a long time, they say, wow, I did that years ago, and I
never got caught on it, or, I never knew I was doing it.
It's all a process of educating, getting a better educated
and trained acquisition workforce, and we've been working very,
very hard at that--to the point now where I'm very proud that
we uncover the problems before other people do. Of course,
there are reporting requirements that we have to comply with.
We've done that. The IG has investigated it. We have squared
away that situation. People have been let go. And we're moving
on now.
Senator Snowe. And so, how many vacancies do you have
currently in the program?--
Admiral Papp. Ma'am, I'm sorry, but I don't know the exact
number of vacancies. But we're continuing to hire and, in fact,
in this budget we continue to open up a number of other
positions as well. Our vacancy rate is very low now. But, I'd
like to get the exact number to you for the record.
[The information requested follows:]
As of June 23, 2011, the Coast Guard Acquisition Workforce vacancy
rate was 13.0 percent. This equates to 131 vacant positions out of a
total of 940 positions within the workforce.
Senator Snowe. I appreciate that. And so, all the remedial
action has been taken on the 20 deficiencies that were cited in
the report?
Admiral Papp. Yes, ma'am.
Senator Snowe. Thank you. Last year, as you know, in
Congress we passed the Coast Guard Reauthorization Act which
addressed some ongoing concerns about the acquisition
management process. The reforms, I know, are ongoing in your
agency, and have been over a period of time, to address what
happened to the National Security Cutter.
One of the issues is this full-funding requirement rule by
the OMB. How does the inability to expend funds for long lead
materials for the National Security Cutter. How is that going
to affect the process? Have you discussed that here today?
Admiral Papp. We haven't discussed it. It presents us with
a challenge, because in past years we have received, for
instance, funding for long lead materials.
What we do know is that, as much money as you can put up
front, it reduces your long-term costs in terms of getting
these things built. The longer you press things off to the
right, the more expensive these things are going to be able to
build. And trying to order one unit at a time, having all the
funding in 1 year, presents us with a challenge, because then
the shipbuilder, to cover itself, will increase its prices in
order to take care of that uncertainty of perhaps not having a
follow-on ship as well.
So, part of the challenge that we faced--I wanted to put
NSC number 6 in the 2012 budget, but when we finally negotiated
our fixed-price contract for numbers 4 and number 5, we had to
ask for additional money in this year, which would not have
allowed us to fit all of the money for number 6 in this budget
year.
I'm very grateful to the Congress for providing all the
money in the 2011 budget so that we could award NSC number 5
this summer. But now, unfortunately, it looks like we'll be
delayed in follow-on orders for 6, number 6, until the 2013
budget.
Senator Snowe. Until the 2013. So, you'll be off by one or
2 years on that scale?
Admiral Papp. Well, one from where I wanted to be right
now. So, and of course, you probably incur some additional
costs as well, as you move that further to the right.
Senator Snowe. Yes, I know. That is one of the things we
tried to resolve with the Deepwater acquisition program
reforms, was to make sure you received the money in a given
year so that you can move forward.
Where does the recapitalization of the medium endurance
cutter stand? Those are vessels are approaching 50 years of
age. And you also have included $25 million for the pre-
acquisition of the Offshore Patrol Cutter in this year's
budget?
Admiral Papp. Yes.
We're getting into the design--we've put out the request
for proposals for the preliminary design right now. We'll be
looking at multiple preliminary designs. So, this money covers
the review of those, and then ultimately we down-select to one
design 2 years from now, and then hopefully have money in the
budget 3 years from now to start construction.
Senator Snowe. So, the commissioning is still scheduled for
2014?
Admiral Papp. No, ma'am. We won't see that in 2014. It
would be probably 2015 before we actually award and start
cutting steel. But that may even slip into 2016, depending upon
the progress we make with the National Security Cutter.
Obviously, we have to get the National Security Cutter out of
the way so we can make room for the OPC.
Senator Snowe. How does that affect your mission
requirements?
Admiral Papp. Well, it affects my mission requirements, or
because the, we're losing effectiveness of the ships that are
in existence. Two things----
Senator Snowe. You're having to do the, all the
maintenance?
Admiral Papp. Exactly. We're getting about 75 percent of
the desired days out of our high endurance cutters now because
of breakdowns. And when we do have breakdowns, because the
equipment is old, sometimes companies have to re-manufacture
parts that they don't, they no longer hold in stock. It costs
us more and more each year.
So, we talked about the 1 percent increase in our budget,
and I'm certainly grateful that the President gave us a 1
percent increase. But, all our expenses are going up at a much
higher rate than that to keep these old ships going. So, the
longer we hold onto them, the more they cost us. The longer we
wait to construct the new ships, the more they cost. So, I'm in
this vicious cycle that I find myself caught in.
Senator Snowe. Yes. It is regrettable, because this is one
of the things we tried to avoid in the past, knowing exactly
that all these aging vessels require spending tremendous
resources for maintenance and upkeep, not to mention risk to
those who serve on these ships. They're very old, so there can
be a lot of issues finding the parts which can drive up the
costs, both for maintaining a fleet that clearly isn't going to
be of longstanding use, and then, of course, delaying the new
vessels that should come online. It's amazing and remarkable
that you do with what you have, to be honest with you. I've
said this time and again, given the age of the vessels.
Senator Begich. Admiral Papp, and what we'll do here, we've
done this before, the Ranking Member and I, we just kind of go
back and forth with questions as, until we exhaust each other,
or exhaust you.
[Laughter.]
Senator Begich. But, what happens is, you----
Senator Snowe. That's hopeful for him.
[Laughter.]
Senator Begich. That's hopeful for you. But, we end up
adding to each other's commentary, because I think, you know,
we're trying to figure out what's the right approach to some of
these things.
First off, on the, if I can go to real quick, on the GAO
report on the 20 deficiencies, is there something you could,
again, provide to the Committee, kind of, that list of 20, and
here's what you've been able to do on those? Just kind of a,
you know, bullet--not right now, obviously. But, at a later
date. Would you mind doing that?
Admiral Papp. No, that----
Senator Begich. Just kind of how you succeeded, and kind of
where you're at? Just kind of a----
Admiral Papp. We want to be completely transparent. Because
if we're not, that just leaves a cloud over my acquisition
folks.
Senator Begich. Of course.
Admiral Papp. And, quite frankly, I'm proud of them
discovering this, and then taking the action----
Senator Begich. Excellent.
Admiral Papp.--themselves. And I want to make sure that
everybody understands that we are self-correcting.
Senator Begich. Excellent. So, if you wouldn't mind doing
that, that would be great for us.
[The information requested follows:]
The Coast Guard has been very conscientious in working to comply
with all facets of financial/contracting laws and regulations. In the
summer/fall of 2009, the Coast Guard was reviewing the approach and
structure for the funding of an upcoming major fixed-price contract.
Recognizing the need to reserve funds for antecedent liabilities for
this contract, reviews of existing contracts were conducted to ensure
adequate funds had been similarly reserved for other fixed-price
contracts. Once the potential for non-compliance was realized, the
Coast Guard immediately sought legal advice and conducted further
contract reviews to assess the situation for all major fixed-price
contracts, there was the potential for a deficiency for the Response
Boat-Medium (RB-M) contract. As a consequence, the Department of
Homeland Security (DHS) Office of the Inspector General (OIG) was
notified of the Coast Guard's self-identified potential deficiency
related to the RB-M contract and asked to conduct an independent
review. The DHS OIG started the review in August 2010.
The DHS OIG concluded their review and reported in OIG Report 11-
82, dated May 10, 2011, that the Coast Guard incurred 20 Anti-
Deficiency Act (ADA) violations totaling approximately $6.7 million.
These discrepancies were the result of using funds from later Fiscal
Years to fund changes to contract line items that were initially funded
from an earlier fiscal year.
Once there was a realization that ADA violations were possible in
the summer/fall of 2009, the Coast Guard took the following actions.
Upon review of the RB-M contract funding, immediate action was
taken to correct transactions as much as possible. As a result and as
noted by the OIG (pgs 3-4 of their report), the Coast Guard reduced the
deficiency from approximately $7.8 million to $6.7 million. The Coast
Guard also immediately initiated policy and process changes within the
Acquisition Directorate to prevent future ADA violations.
On October 23, 2009, the Acquisition Directorate (CG-9)
instituted a business process change, via memo, for funding
fixed-price contracts. This process was further defined in CG-9
Standard Operating Procedure (SOP) #9-21 (version 3.4) issued
on 2 March 2010, and was modified as published on 1 June 2011.
Appropriations Law training for the CG-9 Funds Managers is
required to be completed as soon as possible after hiring and
in no less than every 3 years thereafter. This requirement is
also outlined in CG-9 SOP #9-21, and was also made a
requirement for the project Business Managers upon discovery of
this issue.
Four days of appropriations law training for Business
Managers was
Internal controls were reviewed and modified to ensure
separation of duties, verification of appropriate funds usage,
and compliance with this process.
These actions along with other information were provided to the DHS
OIG for their report 11-82 which listed two recommendations for the
Coast Guard. The DHS OIG concluded the report by stating:
``The Coast Guard's corrective actions satisfy the intent of
the recommendation(s), and we consider it resolved and
closed.''
Senator Begich. And then, you noted it--and I guess this
will lead to the question--and that is, the acquisition
timetable, and when you have to move something off, when you
have to not get, maybe, instead of two ships, or three ships,
you're doing two, and the contractor then has to readjust
pricing, and if they do a fixed price on the first two, the
third one's going to be more expensive because you pushed it
off.
Would a multi-year--I think I know the answer to this, but
I'm going to want it for the record--a multi- year
authorization on capitalization be helpful the get these
longer-term kind of agreements, so you get the maximum value? I
mean----
Admiral Papp. I----
Senator Begich. Now, hold that thought--with understanding
that we have an obligation to put the cash in. But, if the two
meld, I'm just assuming that if you could tell a shipbuilder,
OK, we need eight of these ships--I'm using the gross number
here--over a period of time, that they're going to give you a
much better fixed price than, we'll take two this year, and
maybe a third one next year, maybe the year after.
Admiral Papp. Absolutely, sir. You know, I, there are days
that I feel sorry for our shipbuilders--I mean, not real sorry,
because they're getting a lot of my money. But----
[Laughter.]
Senator Begich. Yours, and the Navy, and NOAA, and----
Admiral Papp. But, they are, like any other businessman.
Senator Begich. Yes.
Admiral Papp. If they can order six engines instead of two,
they're going to get an economic order discount, which
ultimately ends up costing me less money, which ultimately ends
up costing the taxpayer less money. So, yes sir. Having multi-
year authorizations is a good start. As you correctly identify,
it's the multi-year appropriations that are really the bottom
line, that we need to get. But, any predictable, steady source
of funding is going to help us in keeping the costs down,
because they'll be able to, they'll have the confidence to
order.
And these are good people. I meet with----
Senator Begich. Right.
Admiral Papp. I met with Mr. Petters from HII. And they
want to build ships. They want to keep the costs down. And
they've been very reasonable in their negotiations with us.
But, they have no guarantees that we're going to go beyond
five, or six, or seven. And what we need to do is definitively
say, we're going to build eight National Security Cutters, and,
and so that they can have that, and then come up with a
predictable, steady source of funding.
Senator Begich. Very good. I'll switch topics here, because
I want to hit a few minutes in, just on the Arctic, and the
needs up there. We've talked a little bit about the High
Altitude Study, which, it sounds like, as we move to the end of
summer, first of fall, we should see something in regards to
that. And that will give us kind of a pathway in, kind of, the
issues that are up there.
Second, your overall view of our readiness--I mean, here's
my concern. And, I know, we have a great debate around here,
always about oil and gas development and OCS. My bigger
concern, to be very frank with you, is ships that are moving
back and forth that are not oil and gas related. They just
happen to have oil or diesel operating them, and they're cargo
ships from some country. We have no clue what their safety
standards are; they run aground. And that to me seems to be the
bigger concern. Because we know the way we operate with the oil
and gas industry, at least in the Arctic--I can't speak to the
Gulf--but, in the Arctic, and the work we do in the North
Slope, we're very conscientious of what they need, and what
their requirements are.
Can you give me some, just some thoughts on the Arctic? And
then, I think, there's no question in my mind, we need a
deepwater port up there--not only for the industry, but for the
Coast Guard, and oil spill technology. And these ships that are
just cruising, you know, at some point--when I way cruising by,
I'm exaggerating. They're not, like--but, they're going to be
up there, and they already are. And I don't know what they're
made out of, and what, they're going to run aground in shallow
water up there. Any comments on that?
Admiral Papp. Well, sir, you know, I could spend my entire
existence as Commandant preoccupied with the day-to- day issues
that are going on. But, what I've, one of the things I've
chosen to look at in terms of needs of our country for the
future is the Arctic. And I appreciate you going up there with
me last summer when I made my visit. I visited Barrow, Kotzebue
and Nome. And actually, it was a revisit, because I had served
up there as an ensign 35 years ago. And so it was good to get
back up there and see the changes.
But what has not changed is the infrastructure up there.
And I think that we have to have a robust discussion on the
infrastructure needed to support what is no doubt going to be
an increase in human activity up there, off the north coast of
Alaska.
Icebreakers, I think, are important, but they cloud the
discussion of the other needs that we have up there. And, I
think we've focused too much on icebreakers over the last few
years, even though they are important----
Senator Begich. Right.
Senator Begich.--and needed. But, right now, if we were to
have to mount a response like we did in the Gulf of Mexico--I
sent 3,000 people down for Deepwater Horizon. You know how many
hotels are available in Barrow.
Senator Begich. That's right.
Admiral Papp. We have no place to put people up there. We
have no hangers for aircraft. We have no piers, no Coast Guard
boats. So, my immediate pressing concern is, as human activity
occurs, as you have that ship that goes through that--first of
all, we'll assure safety standards, because no matter where
ships operate in the world, we are involved in their safety
standards. But, if an accident happens, how do we respond?
And right now we've got zero capability to respond in the
Arctic right now. And we've got to do better than that. That,
when people ask me, what keeps me awake at night--an oil spill,
a collision. A ship sinking in the Arctic keeps me awake at
night, because we have nothing to respond. Or, if we respond,
it's going to take us weeks to get there.
Senator Begich. Right.
Admiral Papp. So, a seasonal air station, seasonal boats.
We have a full range of Coast Guard capabilities that we need
to be placing up there.
And also, it provides an opportunity for the interagency to
be able to--if we have an infrastructure that's in place, the
interagency that would be involved and needed for a response to
some sort of disaster would have the ability to station up
there, as well.
Senator Begich. Let me end on this comment, and I'll turn
back to the Ranking Member. And that is, you hit where, you
know, you're right. We talked, it kind of gets the attention,
the icebreaker, which is a big ticket item, so, we're--but, you
get where I'm really interested in, and that's what I call core
infrastructure. It may be, like you said, seasonal runways,
seasonal facilities. Or, even long-term deepwater port access
to the area, that you can move in and out very rapidly, and/or
be stationed there permanently. And I think that's the biggest
challenge.
And I know, from this committee's perspective, this is one
area that we're going to concentrate on because the frontier,
the opportunity up there, is unbelievable from the oil and gas,
to mineral, the fishing, transportation components, it has so
much--and you're right. No matter what happens, where we think
it is, where we stand on the political spectrum, there is going
to be increased--and I'll use your phrase, because I think it's
a great phrase--human activity up there. Period. And it doesn't
matter what spectrum you sit on. And if we're not preparing--
and infrastructure is part of it. The onshore infrastructure is
a critical piece of it.
So, I appreciate you emphasizing that. Because I know we
get wrapped around sometimes the icebreaker a lot, which is,
you know, and, like you said, we don't want to diminish the
importance of that, because it is. But, this other
infrastructure is critical for year-around, or increased
activity that may occur up there.
Admiral Papp. Yes, sir. And, what I owe you is a concept of
Coast Guard operations up there. And thank you. I understand
you're on the schedule for the Arctic Symposium that was held
earlier this week. I spoke on the first day.
What I owe the administration and the Congress is a Concept
of Operations on how we carry out the full spectrum of
responsibilities up there.
I faced almost the opposite situation when I was the Ninth
District Commander on the Great Lakes, because people thought,
once the lakes freeze over, you don't have anything to do up
there. The fact of the matter is, you've got a lot to do and--
--
Senator Begich. You have a lot.
Admiral Papp.--you need the special capabilities to be able
to do that. Well, we've always thought the Arctic is a place we
don't have to worry about, because it's covered with ice. But,
now we've got all that open water--the Coast Guard authorities,
Coast Guard responsibilities exist there. The challenge is, we
don't have the resources to apply against them. And I need to
come up with a consolidated plan on how I will address that,
and put the resource proposals forward so that we have
transparency for everybody to see, so we can start working
toward it.
Senator Begich. Well, we'll work with you on that.
Let me turn back to the Ranking Member and see if she has
some additional questions.
Senator Snowe. I just have a couple questions. Admiral
Papp, in terms of the National Security Cutter and the Offshore
Patrol Cutter, how do the numbers square with your mission
requirements?
Admiral Papp. Well, this goes--the mission-needs statement
goes back to 1994, when we started working on this. And then,
during the late 1990s, when we finally decided on the numbers
of ships, and, as we all know, the numbers of missions have
increased since then.
And I think a studied review of where we are right now
would probably--and, as I mentioned earlier in the hearing
here, every review I've seen always says, you need more ships.
You need more than what you're asking for. And that's probably
true. But we're having a hard time just getting to our
acquisition baseline that we've asked for right now. So, it
makes the discussion almost fruitless, because we're having a
hard time just getting to the 8 and 25. So, that's where we've
put our focus.
Frankly, if I get the 8 and 25, we will find ways of
covering all the bases that we need to do. And, if at some
point in time somebody thinks we need more to do that, I'm
always grateful to get that sort of support. But, right now I'm
focused on the 8 and 25.
Senator Snowe. Unfortunately, yes, it was a significant
setback. As you know, the Deepwater acquisition process set the
program----
Admiral Papp. Yes, ma'am.
Senator Snowe.--back a number of years.
Do you have an age breakdown of the ships in your fleet?
Admiral Papp. Well, for our major cutters, on average, the
high endurance cutters, the Hamilton class, are about 40 years
old, a little beyond that. The 210-foot medium endurance
cutters on average are above 40. And then, the, I say, it's
positive, but the 270-foot medium endurance cutters which were
built a little bit later, they're, across the board, I think
it's an average of 23 years right now. So, they're at the
limits of their originally designed service life, and we're
going to need to get, probably, another 10 or 15 years out of
them.
Senator Snowe. Thank you.
Admiral Papp. But we can get you a more precise breakdown
for the record.
[The information requested follows:]
----------------------------------------------------------------------------------------------------------------
Class # of Assets Today Original Designed Service Life Average Age
----------------------------------------------------------------------------------------------------------------
WMSL-418 2 30 2
----------------------------------------------------------------------------------------------------------------
WHEC-378 10 30 42
----------------------------------------------------------------------------------------------------------------
WAGB-420 1 30 12
----------------------------------------------------------------------------------------------------------------
WAGB-399 2 30 35
----------------------------------------------------------------------------------------------------------------
WMEC-270 13 30 24
----------------------------------------------------------------------------------------------------------------
WMEC-210 14 30 44
----------------------------------------------------------------------------------------------------------------
WMEC-282 1 30 40
----------------------------------------------------------------------------------------------------------------
EAGLE 1 N/A 75
----------------------------------------------------------------------------------------------------------------
WPB-110 41 20 22
----------------------------------------------------------------------------------------------------------------
WPB-87 73 25 9
----------------------------------------------------------------------------------------------------------------
WLBB 1 30 5
----------------------------------------------------------------------------------------------------------------
WLB 16 30 10
----------------------------------------------------------------------------------------------------------------
WLM 14 30 13
----------------------------------------------------------------------------------------------------------------
WTGB 9 30 30
----------------------------------------------------------------------------------------------------------------
WYTL 11 30 48
----------------------------------------------------------------------------------------------------------------
WLI 4 30 57
----------------------------------------------------------------------------------------------------------------
WLR 18 30 43
----------------------------------------------------------------------------------------------------------------
WLIC 13 30 45
----------------------------------------------------------------------------------------------------------------
TOTALS 244
----------------------------------------------------------------------------------------------------------------
Senator Begich. Just before you got here, we asked for a
kind of a flow chart----
Senator Snowe. Yes.
Senator Begich.--of just what they have, what they're
replacing, and then the most difficult channel, or, the last
column is, what they really need, and so we can see these gaps.
Because I think that's where your core question is coming from.
Because some of these things are so darn old that, you know,
you're going to be floating one day, and it's not going to be
powered by anything other than, hopefully, a sail, you know.
Admiral Papp. Well, one of the other challenges that we
face is, many times people will say, Well, why don't you just
buy some more Law Enforcement Detachments and put them on Navy
ships? And when I talked about that to Admiral Roughead, he
kind of laughed at me, because----
[Laughter.]
Admiral Papp.--he would make the case, he's not got enough
Navy ships to do the things that he needs to do.
Senator Snowe. Right.
Admiral Papp. And, in fact----
Senator Begich. Yes.
Admiral Papp.--we're seeing less and less--particularly
down in the drug interdiction mission, Wichata South--we're
seeing fewer Navy ships. Our foreign partners--the British, who
have been so reliable, and the Dutch--we're seeing less of them
down there. We used to put Law Enforcement Detachments on them.
So, allied support and our own Navy support is diminishing, and
at the same time we're having a harder time keeping our cutters
out there.
Senator Snowe. I know. This issue is related to
procurement, even in the Navy. We're far below the 300-ship
Navy that was the original goal.
Senator Begich. Right.
Senator Snowe. I remember the days when they were talking
about a 600-ship Navy, back in the early 1980s. So, you can see
how far we've come. But, unfortunately, the level of
procurement is never sustained. I used to be Chair of Sea Power
in the late 1990s. And unfortunately, the level of procurement
never sustained even a 300-ship Navy. And so, here we are today
with a fleet down in the 270s.
Admiral Papp. Yes, ma'am.
Senator Snowe. So, again you are asked to do more with
less, and being stretched thin, and the demands around the
world are increasing.
I wonder if there's any way of comparing the costs, in
terms of looking at the maintenance costs--let alone the
separate issue of getting the parts. That's another question.
Because that does add astronomically to the costs, when you
have to Rube Goldberg, you know, many of the parts in these
boats.
Admiral Papp. Well, it's the cost, and the reliability as
well. We're just--we're for a high endurance cutter, if we,
we're getting only about 75 percent of the days that we're
programmed for with them right now. And it's affecting the
other ships, as well.
And, as I said before you came in, of our layered security
that we do, the overseas people that we put to inspect in the
ports, and then our conventional forces that are in our ports,
we have this very important layer out there that provides a
persistent presence offshore, that guards against migrants, can
do search and rescue, can do drug interdiction. And, that's the
layer that I'm most concerned about, because now it's the least
reliable. Unfortunately, it's the most expensive to replace.
But it's also the most versatile. On September 11, what did
we do? We took one of our medium endurance cutters and actually
put it in the Port of New York to serve as a command and
control platform. Yet, we can send that same ship 2,000 miles
offshore to interdict a threat vessel coming in, or perform
search and rescue.
We had the Morgenthau, which is 42 years old, that was sent
well offshore to rescue four Venezuelan fishermen that were
severely injured when their equipment crashed on them off the
coast of, well off the coast of Colombia. And they sprinted out
there and picked up the four crewmen, provided medical support,
got them into Mexico, and, basically, on fumes, because they,
we don't have the capability to ballast the ship and refuel it
out there.
So, they're still getting the job done, but at an
increasing cost.
Senator Snowe. One final question. As you know, the 2010
Coast Guard authorization included significant changes to
commercial fishing, inspection and safety requirements--you
know, inspections are now mandatory for commercial fishing
vessels and increased safety training will be required. These
are all major issues important to the industry.
But there is, there was a committee that was established in
order to make sure that the fishing community was involved in
the implementation. Where does that process stand?
Admiral Papp. We're in the process of drafting up the
regulatory package for that right now, and starting to work
that through.
The other thing is, it's another one of those jobs that's
going to carry resource needs with it. We've been
recapitalizing our marine safety and marine inspection forces
over the last couple of years. This budget continues that
process in putting people out there. We do have to designate
some people and find people with the right competencies for
fisheries inspections. And as we take on, as we're continuing
to analyze what sort of workload this is going to be for us, I
think we'll probably see, within the 2013 budget we'll start
identifying some of those resources we need to beef up our
fisheries inspection forces.
Senator Snowe. So, the Committee for implementation for
these safety measures has not yet been established?
Admiral Papp. Okay. That's correct.
Senator Snowe. Are you required by a certain time frame to
accomplish that?
Admiral Papp. I don't have the exact date at the tip of my
fingers, but I can provide that for the record.
[The information requested follows:]
The Coast Guard is developing a rulemaking to fulfill our statutory
responsibilities under the Coast Guard Authorization Act of 2010 for
commercial fishing vessel safety requirements that took immediate
effect.
Senator Snowe. I think it's to make sure that the fishing
community's involved in the process before these rules are
implemented, given that they are such important stakeholders.
This is why I was wondering about the timeline for
implementation of these new rules.
Admiral Papp. Oh, absolutely. Yes, ma'am.
We do have a timeline. Unfortunately, I just can't----
Senator Snowe. OK.
Admiral Papp.--remember the specific dates. But we'll
provide that for the----
Senator Snowe. But, that will run--it will be run
simultaneously with the Committee itself----
Admiral Papp. Yes, ma'am.
Senator Snowe.--that will involve the fishing industry.
Admiral Papp. Yes, ma'am.
Senator Snowe. It is important because in New England the
commercial fishing industry continues to have the highest
fatality rate of any occupation, which is deeply troubling.
Admiral Papp. Yes, ma'am.
Senator Snowe.--and so----
Admiral Papp. The good news is--these regulations are long
overdue. We're glad to have them. It's, the process now is just
the implementation, and identifying the resources to carry it
out.
Senator Snowe. Thank you, Admiral Papp. Thank you very much
for your exceptional work, and we appreciate it. Thank you.
Thank you----
Admiral Papp. Thank you, Senator.
Senator Snowe.--Mr. Chairman.
Senator Begich. Thank you, Admiral Papp.
And I will have just a couple quick ones. And then we'll,
unlike some committees, we'll end up early. This is good. So,
we like that.
Let me ask you very quickly one, it has a relationship to
Alaska, and it's in regards to unmanned aircraft. And I know
the Coast Guard is considering, that, when you deal with
unmanned aircraft, there are a couple--I'm not sure how
familiar you are with them--there's the Fire Scout, then
there's the ScanEagle, there are a couple, and, the ScanEagle,
which is being developed. And, I know, the University of Alaska
at Fairbanks, is developing, it's a lower cost--they're working
with NOAA right now very successfully.
Has the Coast Guard looked at alternatives to the Fire
Scout, which is more expensive alternative, to one that, for
example, I know UAF is working with NOAA on? I don't know if
that has been in your mix or not. If you don't have a direct
answer for that now, I'd love that for the record, so I kind of
get the sense of the budgetary constraints, and how you're
looking at these types of issues, too.
Admiral Papp. Well, you're right. The budgetary issue has
been the problem for us with the other acquisitions and trying
to fit them in.
Our unmanned systems have gone unfunded so far. We need a
long-range system similar to Predator to cover a broad area.
The entire Deepwater System, as it was originally conceived,
depended upon unmanned systems. And then you need a shipborne
tactical UAV to use, as well.
We've been streaming behind the Navy on this. The Navy has
put their effort behind Fire Scout. Since we don't have the
wherewithal or the funding to strike out on this, our own----
Senator Begich. Right.
Admiral Papp.--we've been following the Navy's progress.
And if the Navy decides to go with it, it really does offer us
long-term efficiencies in terms of logistic support, training,
and other things that would save the Coast Guard money. So,
sometimes we look toward our bigger sister service to provide
the lead on this, because we can use common systems. But, we're
certainly willing to look at what other systems are out there
that might make sense for us. It's all a matter of, how can we
do that efficiently?
Senator Begich. Great. If you wouldn't mind just giving me,
again, at a later time, just kind of a response, especially
with the ScanEagle, and if that, even--you gave us a good
argument here, because the Navy's already doing the Fire Scout,
and therefore you've got a lot, you're kind of grabbing the
tail and holding on to a lot of their volume, in essence--
volume of purchase, potentially, volume of training. And I know
NOAA's kind of focused on the ScanEagle.
But I'd be interested in your positives and negatives on
the system.
Admiral Papp. I will take a look at ScanEagle and give you
an assessment back on that.
[The information requested follows:]
The Coast Guard is currently investigating the utility of several
small Unmanned Aerial Systems (UAS), including Scan Eagle and the
Navy's Small Tactical UAS program, as an interim step for a cutter-
based capability. Although relatively limited in payload capacity, the
inherent simplicity of such smaller systems is they would allow the
Coast Guard to evaluate much of its cutter-based UAS Concept of
Operations, develop required skill sets, and support the acquisition
effort at a reduced cost. With potential partnership opportunities,
this methodology allows the Coast Guard to effectively and affordably
evolve into the larger, objective systems while they continue to be
developed.
Senator Begich. Fantastic.
The other one is, I, there's a huge--and we actually had a
little bit of discussion--it's about our infrastructure,
onshore infrastructure. Has, do you go through a process now,
as the new Commandant, now you've been there a year--we expect
everything from you now, after a year--but, have you done or
started any process to kind of look at all the basing that
occurs all across the Coast Guard, and determining, OK, can we
consolidate? Are there better approaches? Is there better
positioning of our onshore assets? Is that something that you
would do on a normal, regular basis? Or, is that something that
would be done just as a new Commandant?
Admiral Papp. We----
Senator Begich. Does that make sense? It's kind of like
what we're doing on the military side, it's always the
international BRAC, the domestic BRAC, we're always, kind of,
turning----
Admiral Papp. Oh, absolutely.
Senator Begich. Yes.
Admiral Papp. Yes, sir. I owe that to you. I owe it to my
people to make sure that we're keeping it properly balanced.
Part of this ``Steadying the Service'' theme that I used
right from the start is stopping all the constant
reorganization that we had been doing, and locking in, so that
then we can properly resource and balance across all, the
sector concept, making sure all our sectors are properly
resourced, our district commands are properly resourced, and
then getting our mission support side right. This is an ongoing
process for us.
We're looking at our deployable specialized forces--I'm
doing what I call a stem-to-stern review on them, to make sure
that we're using them optimally, and making sure they're
properly trained.
At the same time, we're also doing a boat force
optimization program. I'm a believer that we've got too many
boats out there, too many boat classes, and consequently, it
provides us logistic challenges and training challenges at most
of our boat stations. So, we're looking, we're reviewing all
them with an eye toward reducing the number of boats that we
have to maintain out there, while still maintaining operational
efficiency--or, effectiveness, rather.
Senator Begich. Great. And maybe, as you finish some of
those analyses--the boat forces, the stem-to-stern--would you,
maybe we can coordinate with your staff, and maybe those are
opportunities for you or your staff to present to the Committee
what you found, what can happen, what, you know, again, having
an opportunity there.
Admiral Papp. Yes, sir. Absolutely. I think what we will
find, though, is, most places, we're under-resourced in terms
of people. People is really the issue. And if I could just
highlight that. We lost about 5,000 or 6,000 people in the mid-
90s when we went through a process called streamlining, which
is just another name for--you're getting less money, so----
Senator Begich. Budget-cutting.
Admiral Papp. Right. We have grown over the last decade.
But really, we're only back at the strength that we were at the
early 1990s, and we have, clearly, more missions, more jobs to
do. So, even though we've gained 6,000 people, they're fully
employed.
Senator Begich. Right.
Admiral Papp. And the 2012 budget, I gave guidance when we
developed our 2012 budget--I don't want to cut a single person.
We need every person that we have. And we still need to give--
--
Senator Begich. Right.
Admiral Papp.--mission effectiveness, and deliver our
services. And we need to recapitalize. And we're in a fine
balance point right now with this budget. Not everything I want
or need, but we're keeping it balanced.
Senator Begich. Excellent.
Admiral Papp. We start going below, and something's got to
give--either we've got to stop buying more boats and ships, or
I've got to start cutting people. I'm really at that point
right now. And the last thing I want to do is cut people. But I
think we're going to find ourselves backed into that position
as we face further constraints on the budget.
Senator Begich. Last question, and then I'll close off. And
that is--and this is kind of a global question, and one that
may be uncomfortable to answer. But, you know, you are now
under Homeland Security, and, I guess the question is, being in
that situation, where you're located now, does it create
administrative challenges, or challenges that affect the
potential for your readiness and ability to deal with some of
the issues? And it may be, regulatory setting, or work that
maybe is necessary to complete your mission.
And I, why I'm asking this is, it's kind of a quirky
question in the way I'm asking it, is, sometimes when you move
an agency--and the Coast Guard kind of keeps, you know, moves
here, and moves here--that, when you do that there are new
processes that new agency has which, then, you have to adjust
to. Or, sometimes it's faster, or slower.
Can you give me your thoughts of, now you're under Homeland
Security. Is that, you know, creating--does it give you the
flexibility that you need to be, really, the Coast Guard that I
think we all expect, and need, and desire? Does that--without
putting you in an awkward--I don't want to put you in any
position here. But I just, because part of our role is, I
think, is to, we want you to be very effective in anything, and
if there's process that are layered on top of you that are
creating problems, we need to know that.
Admiral Papp. Sir, I, first of all, you never make me
uncomfortable.
Senator Begich. Good.
Admiral Papp. I'm going to be candid with you and----
Senator Begich. Good.
Admiral Papp.--tell you exactly what I feel. And I will
tell you that I'm happy in the Department of Homeland Security.
Is it perfect? No. But it wasn't perfect in the Department of
Transportation, either.
But, what I will say is, more of our mission sets fit
within the Department of Homeland Security than when we were in
the Department of Transportation. Yet, there are transportation
issues that are still very important to me. We meet with the
Department of Transportation all the time. Just like I talked
about the bridge that we provide to the Department of Defense--
--
Senator Begich. Right.
Admiral Papp.--we also provide a bridge to the Department
of Transportation. I'm meeting constantly with the Department
of Justice, the Department of the Interior. The beauty of the
Coast Guard is----
Senator Begich. Right.
Admiral Papp.--we provide those linkages across.
The challenge I face in DHS is, it's still a new
department, and consequently, we don't have the career
bureaucrats--and I'm not saying that pejoratively--but, we
don't have the career bureaucrats that understand the multi-
mission capabilities in what the Coast Guard does.
Senator Begich. Yes.
Admiral Papp. They are learning. But, the challenge is, in
this new department, the leadership is very shallow. There's a
lot of political appointees. So, consequently, there's
turnover, and you have to re-educate.
I will tell you that Secretary Napolitano is personally
involved, going out visiting the Coast Guard, learning. I mean,
for someone who didn't have much coastline as a Governor, she
has done magnificently in terms of learning about what we do.
Our Deputy Secretary, Jane Lute, has been marvelous. I meet
with her every week. She is personally involved in working up a
strategy which explains us better to OMB and other people on
all these capabilities that we bring into the Department, that
heretofore people said, What? Aids to navigation in Homeland
Security? Oil spill response--well they understand oil spill
response now----
Senator Begich. Yes. They've got it now.
Admiral Papp.--clearly. But, the Secretary and Deputy
Secretary are believers.
Senator Begich. Good.
Admiral Papp. And they are both personally involved in
convincing other people that need to understand the versatility
and adaptability the Coast Guard brings to all the missions
sets.
We even had, at the beginning of the Department, we had, of
our 11 missions, we had some that were considered homeland
security, others that weren't. There were proposals to fund
them at different levels. Now, both the Secretary and Deputy
Secretary believe all 11 statutory missions have an impact on
homeland security.
So, back to the bottom line--I'm happy where I'm at. And
it's not providing me an impediment.
What it obligates me to do is make sure I continue to work
with my Secretary to make sure she, or in the future, he,
understands fully what we bring to the table.
Senator Begich. Well, thank you, Admiral Papp. And let me
just say that, in all the year here, and the time we spent on
the plane in going up north, you've always been very candid.
And it's always a pleasure to work with the Coast Guard in all
aspects because, you have great needs, but also provide an
incredible service. And the men and women that serve in the
Coast Guard are unbelievable, and the families that support
them.
So, first, again, thank you for coming today.
We're going to continue. We have some questions we'll
submit for the record, and look forward to those answers. And
then, the hearing record will be open for another 7 days for
submission and comments by other members. But, again, we want
to thank you for being here today, and doing what you do in the
Coast Guard, because it is an incredible team of folks.
Admiral Papp. Thank you, Mr. Chairman.
And, thank you, Senator Snowe.
Senator Begich. This meeting is adjourned.
[Whereupon, at 11:35 a.m., the hearing was adjourned.]
A P P E N D I X
Response to Written Questions Submitted by Hon. John D. Rockefeller IV
to Admiral Robert J. Papp, Jr.
Question 1. While we understand that an engine overhaul alone will
not bring the POLAR SEA back to operational status. How much would the
engine overhaul cost?
Answer. The cost to repair and overhaul POLAR SEA's 6 Main Diesel
Engines and 2 Ship's Service Generators would be $4.5 million.
Question 2. What is the cost (range) to bring the POLAR SEA back to
operational status and what work would that entail?
Answer. Approximately $14-15 million non-recurring funding to
complete the necessary Hull, Mechanical & Electrical (HM&E) work and an
additional $30 million annual recurring funding for crewing and asset
Operations & Maintenance (O&M) are required to return POLAR SEA to
operational status. Operational status is defined as the ability of the
cutter to deploy for a polar mission. It is estimated that this work
would take 12-16 months, with impacts to the POLAR SEA schedule, to
complete from the receipt of funding.
Bringing POLAR SEA to operational status would also have
significant impacts to the current POLAR STAR reactivation project due
to limited supply of critical parts and long production timelines for
diesel engine parts that would have to be allocated across both assets.
Additionally, the specialized workforce necessary to reconfigure the
engines would also have to be balanced across both assets. The required
work listed above would return POLAR SEA to operational status but
would not significantly enhance reliability. POLAR SEA's projected end
of service life would remain at the end of 2014, which means escalation
of reliability concerns and maintenance costs would continue unless a
Service Life Extension Project (SLEP) was performed.
Question 3. How much would a 10-yr service life extension of the
POLAR SEA likely cost?
Answer. Approximately $40-68 million in non-recurring funding would
be required to achieve a 10-yr service life extension for POLAR SEA as
a bridging strategy until new construction. Additionally, $30 million
of annual recurring funding will be required for crewing and Operation
& Maintenance (O&M) costs.
Question 4. Would the 10-yr service life extension include the
necessary overhaul of the engines?
Answer. Yes.
Question 5. The Coast Guard performed admirably as head of the
Federal response to the Deepwater Horizon oil spill, and the Service
continues to do good work overseeing the cleanup of the Gulf. As we
approach the one-year anniversary of the capping of the Deepwater
Horizon well, what are some of the lessons the Coast Guard has learned
from that historic response? What did we get right and what could we
have done better?
Answer. The Deepwater Horizon oil spill was the first incident in
U.S. history to be declared a Spill of National Significance (SONS) and
the first to designate a National Incident Commander (NIC). Despite the
challenges of the first ever SONS declaration and NIC designation, many
aspects of the response worked very well.
The National Contingency Plan (NCP) served the Nation well and
proved effective during the Deepwater Horizon response. The NCP
provided a sound framework that allowed for the needed discretion and
freedom of action to address contingencies that arose during the
response.
Although the NIC's role and function evolved through the course of
the response, the NIC proved to be an effective command organization
that served its intended purpose to promote unity of effort across the
whole-of-government.
After several near mishaps in the airspace above the oil spill
response, the NIC, in coordination with U.S. Northern Command and the
U.S. Air Force, established the Aviation Coordination Center (ACC) at
Tyndall Air Force Base in Florida to establish command and control over
the airspace. The ACC helped prevent midair collisions, improved
situational awareness, validated oil trajectory monitoring, tracked
skimmers and vessels of opportunity, and directed boom deployment to
where it was most needed.
The Coast Guard is conducting a review of the President's National
Commission on the BP Deepwater Horizon Oil Spill and Offshore
Drilling's findings, the National Incident Commander's (NIC) Report,
Incident Specific Preparedness Review (ISPR) along with the other
Deepwater Horizon reports that provide a body of observations,
perspectives, and opinions. The Coast Guard is carefully reviewing
these reports to identify areas of positive and effective preparedness
improvements to develop effective and appropriate national
implementation strategies. The Coast Guard has already taken several
actions to address areas where planning and preparedness will be
improved, including: directing Captains of the Port to review Oil Spill
Response Plans for offshore facilities; requiring Area Committees to
include Worst Case Discharge scenarios for offshore facilities in their
respective Area Contingency Plans; increasing State, local, and tribal
outreach and participation in Area Committee meetings and activities;
participating in a Coast Guard, Federal Emergency Management Agency,
and Environmental Protection Agency workgroup to develop
recommendations to harmonize the National Contingency Plan and National
Response Framework governance constructs. Additionally on July 7, 2011
the Coast Guard issued a Federal Register Notice announcing an updated
policy employing risk based targeting to prioritize inspections of
foreign-flagged Mobile Offshore Drilling Units operating on the Outer
Continental Shelf.
Question 6. Congress has made few legislative fixes to address gaps
in our spill prevention and response capabilities. Does the Service
have the statutory authorities and flexibility it needs to respond to
Deepwater Horizon-like events in the future?
Answer. Broadly speaking, the statutory authorities vested in the
Secretary of Homeland Security and the Commandant of the Coast Guard
are sufficient. The Deepwater Horizon oil spill however, did expose the
limitations of those powers when confronted with a spill of national
significance--specifically, the ``per-incident'' limitation on
expenditures from the Oil Spill Liability Trust Fund, the limitation on
advances from the Fund for Federal removal activities, and the lack of
an appropriation from the Fund for the extraordinary costs to
administer the claims process. The Coast Guard is conducting a
comprehensive review of the various Deepwater Horizon reports to
identify areas of improvement and, from this viewpoint, the sufficiency
of its authorities. Once this review is complete, the Department stands
ready to work the Congress to identify appropriate remedies to
identified limitations.
Once this review is complete, the Department stands ready to work
with Congress to identify appropriate remedies to identified
limitations.
Question 7. Do you envision the Coast Guard being more or less
involved in inspecting offshore drilling systems and how do you think
the Service and the successor agency to the Minerals Management Service
should coordinate their inspection duties for offshore drilling
systems?
Answer. The Coast Guard shares foreign-flagged Mobile Offshore
Drilling Unit (MODU) regulatory responsibilities with the Bureau of
Ocean Energy Management, Regulation and Enforcement (BOEMRE). Each
agency's areas of responsibility are outlined in a Memorandum of
Understanding (MOU) OCS-01 signed September 30, 2004. This MOU outlines
the inspection responsibilities of the two agencies. In general, the
Coast Guard's primary responsibilities are related to vessel operations
and safety systems including firefighting, lifesaving, electrical
systems, and hull structures on MODU's. BOEMRE's primary responsibility
is subsea operations and drilling systems. The Coast Guard does not
oversee drilling systems, but the interface between subsurface and
surface operations warrants very close coordination and collaboration
between both agencies.
The MODU Deepwater Horizon casualty primarily resulted from a well
blowout. Although the blowout preventer and drilling systems fall under
the authority and jurisdiction of BOEMRE, this incident and others have
prompted the Coast Guard to review all operations and systems under its
responsibility for potential improvements to both regulations and the
inspection regime of foreign-flagged MODUs on the U.S. Outer
Continental Shelf (OCS). To that end, the Coast Guard is developing
improvements to enhance the safety of offshore operations and improving
coordination with BOEMRE. Furthermore, Coast Guard and BOEMRE
established a prevention working group to enhance alignment and
consistency on how inspections are conducted.
The Coast Guard recently announced, by publication in the Federal
Register, an updated policy that Coast Guard marine inspectors will use
to determine the risk posed by foreign-flagged MODUs operating on the
U.S. OCS by examining accident history, past discrepancies, flag state
performance and classification society performance to identify those
vessels requiring additional oversight in addition to annual
inspections undergone by all vessels. Risk based targeting allows more
efficient use of Coast Guard resources and more frequent examinations
of the highest risk MODUs.
Question 8. Admiral Papp, at the annual State of the Coast Guard
Address in February, you said the following:
``In order to achieve proficiency in our most needed activities
and capabilities, we may have to reduce our range of activities
and capabilities. This is acceptable.'' Let me repeat this--
``We may need to reduce the number and range of capabilities
we've added since 9/11, until properly resourced, and this will
be acceptable.''
Admiral Papp, without the proper resourcing, which activity or
capability will have to be reduced first?
Answer. The biggest challenge the Coast Guard faces is sustaining
front-line operations while simultaneously recapitalizing our fleet to
stem declining readiness. The FY 2012 President's budget supports these
priorities while making investments to enhance maritime incident
prevention and response and support military families. The budget
required tough choices in a constrained fiscal environment to fund
these priorities. These are honest and necessary choices to sustain
front-line operations and rebuild the Coast Guard.
The Coast Guard is no different than other agencies across the
Federal Government--just as the Nation is tightening its belt, we must
focus our resources on the tasks that provide the Nation with maritime
safety and security services in the most efficient manner.
The Coast Guard will leverage technology and base resources to
mitigate impacts of these reductions on Coast Guard readiness,
operations, and the workforce.
Question 9. Section 3316 of Title 46 of the United States Code
grants the United States Coast Guard the ability to delegate the
authority to perform certain Coast Guard functions to the American
Bureau of Shipping and other ``recognized'' classification societies.
This authority encompasses the performance of broad discretionary
functions (review of plans and inspection of vessels to Coast Guard
standards), the ability to approve or reject such plans or vessels on
the Coast Guard's behalf, and the authority to issue vessel
certificates required under U.S. and international law. These
recognized classification societies perform these functions pursuant to
memoranda of agreement (``MOAs'') executed between the society and the
Coast Guard. These MOAs delineate which authority the Coast Guard is
delegating to that particular society and the responsibilities of that
society in carrying out these delegations. They make clear that
approvals issued by the society will be accepted in the same manner as
if approved by the Coast Guard. The MOAs also state that remuneration
for delegated services carried out by the society will be charged
directly to the party receiving such services and not the U.S.
Government.
Given the above, does the Coast Guard consider a classification
society, when performing the functions as described under 46 USC 3316
and the relevant MOA, to be an agent of the Coast Guard?
Answer. Pursuant to 46 U.S.C. 3316, the Coast Guard may delegate
to the American Bureau of Shipping (ABS) or another recognized
classification society the authority to review plans, conduct
inspections, and issue certificates of inspection. However, that same
statute assigns special status to ABS by requiring each department,
agency, and instrumentality of the United States to recognize ABS as
its agent in classifying vessels owned by the Government, and in
matters related to classification.
Question 10. What is the Coast Guard's position regarding the
propriety of allowing an organization which serves as an agent of the
Islamic Republic of Iran on matters of marine safety and security to
also serve in a similar capacity for the United States Coast Guard?
Answer. The Coast Guard believes in the longstanding international
axiom that class societies be permitted to operate in the interests of
maritime safety and pollution prevention regardless of political/
nationalistic affiliations. Recognized class societies operate
globally, providing impartial service to customers regardless of
national affiliation. Moreover, it is this axiom that underpins the
development of an important new Code for Recognized Organizations
(Classification Societies) at the International Maritime Organization.
Question 11. Section 3316 of Title 46 of the United States Code
appears to give the Coast Guard broad discretionary authority regarding
if, when or how it chooses to delegate any of its authority to any
classification society. For example, while Section 3316(a) requires
that U.S. Government agencies ``shall'' recognize the American Bureau
of Shipping as its agent in classifying vessels owned by the Government
and in matters related to classification, Section 3316(b) provides that
the Coast Guard ``may'' delegate its authority to one or more
societies, subject to certain reciprocity and recordkeeping
requirements. Please explain the Coast Guard's position regarding its
discretion to exercise its authority under Section 3316 of Title 46.
Answer. The Coast Guard implemented section 3316 of Title 46 in 46
CFR Part 8.
The Coast Guard exercises its authority to evaluate a class society
for participation as a recognized organization (RO) under 46 CFR Part
8. The elements for accepting an RO under section 3316 can be broadly
described using the terms ``track record'', breadth of customer base,
technical proficiency, and reciprocity. However, the Coast Guard is
limited to the criteria listed in 46 CFR Part 8; it may not create new
criteria not listed without changing the regulation.
Question 12. Does the Coast Guard ever consider that it is
``required'' to grant any of its authority to any society under Section
3316? If so, under what circumstances?
Answer. The requirements for any class society's participation as a
recognized organization (RO) acting on behalf of the Coast Guard is
stated in both 46 U.S.C. 3316 and further refined in 46 CFR Part 8.
Should a class society fail to meet the regulatory criteria required
for participation, the Coast Guard is not compelled to recognize it
under 46 U.S.C. 3316 and 46 CFR Part 8.
Question 13. Section 8 of Title 46 of the Code of Federal
Regulations provides the regulations for the implementation of the
Coast Guard's authority under Section 3316 of Title 46 of the United
States Code. 46 CFR 8 contains several conditions governing the
delegation of its authority to classification societies which are not
contained in 46 U.S.C. 3316, and which are not directly related to the
performance of review/inspection services on behalf of the Coast Guard.
For example, a class society wishing to receive a delegation from the
Coast Guard must execute an agreement which, inter alia, allows the
Commandant to participate in the development of that class society's
rules; requires the class society to inform the Commandant of all
proposed changes to its class rules; and requires the class society to
provide the Commandant the opportunity to comment on any proposed
changes to its class rules. Similarly, the Coast Guard criteria for
recognition of class societies for delegation purposes contain several
requirements not mentioned in 3316 (e.g., ``recognized'' class
societies must have a total classed tonnage of at least 10 million
gross tons; must have a classed fleet of at least 1,500 ocean-going
vessels over 100 gross tons; and must employ a minimum of 150 exclusive
surveyors).
Please explain the Coast Guard's position regarding its latitude,
absent direction from Congress, to establish (e.g., through a
rulemaking process) additional criteria under which it will recognize a
classification society and allow it to receive a delegation from the
Coast Guard, including any criteria which ensures such societies are
not engaged in activities which are inconsistent with United States law
or policy.
Answer. In accordance with the Administrative Procedure Act, the
Coast Guard established regulations that comply with the law. This
effort was undertaken to establish a construct that could ensure
consistency and performance of recognized class societies in a manner
that meets Coast Guard and International Maritime Organization (IMO)
marine safety requirements.
As those marine safety requirements evolve, the Coast Guard will
endeavor to ensure class societies act not only to uphold the
requirements of U.S. regulation, but also meet IMO criteria for the
issuance of international certificates issued on behalf of the U.S.
The Coast Guard does not believe that its criteria are inconsistent
with U.S. law or policy.
Question 14. Section 8.230(a)(23) of Title 46 of the Code of
Federal Regulations provides that, ``In order to receive recognition by
the Coast Guard a classification society must not be involved in any
activities which could result in a conflict of interest.''
Please provide the Coast Guard's position regarding whether the
Coast Guard considers an entity acting on behalf of the United States
in the performance of safety and security inspections, while
simultaneously acting in a similar capacity for a foreign government
which is the subject of U.S. sanctions, to be a ``conflict of
interest'' and counter to the objectives of U.S. policy for purposes of
46 CFR 8.230(a)(23).
Answer. The Department of State (DOS) and the Office of Foreign
Assets Control (OFAC) are the agencies charged with ensuring compliance
with U.S. economic sanctions. While we defer to their expertise and
encourage you to seek their views on the proposed legislation, we do
believe that class societies should be permitted to operate in the
interests of maritime safety and pollution prevention regardless of
political/nationalistic affiliations.
Question 15. The propriety of classification societies serving as
agents of the U.S. Government while those same organizations also serve
as agents of the Islamic Republic of Iran, or other sanctioned
governments, arguably requires consultation with other agencies of the
U.S. Government. Please provide the Coast Guard's position on the
input, if any, required from other agencies, as well as a history of
any previous discussion held with other agencies.
Answer. No formal input has been required from the Coast Guard by
other agencies.
Several separate teleconferences between the Coast Guard and ABS,
and between the Coast Guard and Department of State (DOS) and
Treasury's Office of Foreign Asset Control (OFAC) culminated in a May
2011 meeting with all of the above parties. An additional meeting with
DOS, OFAC and the Coast Guard in June 2011 was held to provide a
``Class Society 101'' instructional session to better acquaint staff
with the work of class societies as ROs under 46 USC 3316. The Coast
Guard recommends contacting DOS to obtain their official position.
______
Response to Written Questions Submitted by Hon. Mark Begich to
Admiral Robert J. Papp, Jr.
Question 1. I was pleased the Arctic Council recently ratified an
international agreement on search and rescue (SAR) in the Arctic. What
can you tell me about the Coast Guard's readiness to uphold America's
responsibilities in this landmark agreement? What do we need in terms
of personnel, assets, and infrastructure to comply with its terms and
perform Arctic SAR?
Answer. The Coast Guard realizes that with limited search and
rescue (SAR) resources and with the increase in human activity in the
Arctic (on land, in the maritime environment and with the increase in
passenger aircraft on transpolar flights), international SAR
coordination and cooperation in this region will become more crucial.
The arctic SAR agreement will serve as the basis for future SAR
cooperation and coordination with the other Arctic Council nations
(e.g., Canada will host an arctic SAR exercise in October 2011; all
eight Arctic Council nations have been invited to participate). In
addition, the agreement highlighted the Coast Guard's already existing
arctic SAR responsibilities and, with limited available resources, the
Coast Guard's continued challenge in conducting arctic SAR.
The agreement does not impose additional requirements on the
Parties beyond those already required by international Convention.
Question 2. The Coast Guard still has not released the Fleet Mix
Analysis--an analysis of the types, numbers, and capabilities of assets
it needs to meet mission requirements. This analysis contains important
information Congress needs in order to make well informed spending
decisions. What is the status of the Fleet Mix Analysis; what is
delaying its release? When will Congress be able to see it?
Answer. The Fleet Mix Analysis was delivered to Congress on July
29, 2011.
Question 3. The Coast Guard reported $1.5 billion backlog in shore
infrastructure projects including century-old small boat stations in
the Great Lakes that are crumbling and very expensive to maintain. Does
there need to be a realignment of bases in the Great Lakes to
consolidate small boat stations and how would this impact the Coast
Guard's lifesaving mission there?
Answer. At this time, realignment of Coast Guard boat stations on
the Great Lakes is not needed. Changes to the Coast Guard's boat
station footprint must be based on a clear understanding of maritime
risks and operational requirements. The seasonal nature of the Great
Lakes creates two distinctly different operating environments, each
requiring unique mission capabilities and assets: cold weather and ice
operations associated with frozen or ``hard'' water conditions, which
impact commercial traffic and pose unique challenges with Search and
Rescue, and warm weather or ``soft'' water conditions that result in a
surge of recreational boating activity.
Coast Guard stations in the Great Lakes play a critical role in
meeting Coast Guard mission requirements along the 6,700 miles of
coastline and 1,500 mile international border encompassed by the Great
Lakes. Cutter capacity and capability is limited and used to the
maximum extent possible to provide offshore presence and response.
Certainly, new technologies and platforms improve our patrol and
response capability. As Rescue 21 and the Response Boat-Medium are
deployed in the Great Lakes, the Coast Guard will continue to evaluate
those capabilities and any opportunities these new assets may provide
relative to the location and number of our stations.
Question 4. It has been a rough 3 years for the Coast Guard's
aviation community with the loss of 14 Coast Guard aviators in
accidents. Many of these accidents are still currently under
investigation by the Coast Guard but I understand the Coast Guard is
conducting a nose-to-tail safety assessment to evaluate the overall
fitness of Coast Guard aviation. What have you learned in your
investigations into these incidents so far; is there a common thread
between these accidents? What lessons have been learned from the safety
assessment and how do you evaluate the overall fitness of Coast Guard
aviation?
Answer. The ``nose to tail'' assessment of the aviation safety
environment was completed earlier this year. Analysis of the study
suggests that a number of factors combined to create an environment
where complacency, rate of change, inadequate leadership, lack of focus
on aviation professionalism and incomplete risk management undermined
the overall safety posture of Coast Guard aviation. Common in each of
the recent mishaps was a failure to adequately address risk factors
when the perceived risk was low. There was also a sense of complacency,
and an environment existed in which safety policies and safeguards were
not effective in preventing mishaps.
The Coast Guard Aviation Safety Assessment Action Plan (ASAAP)
identified immediate action items to counter these negative
environmental factors and provides a plan of action to prevent similar
mishaps in the future. As a result of strong leadership at every level
within the aviation community, a commitment to aviation
professionalism, and immediate actions taken to adopt the ASAAP
recommendations, one-year has passed since the last major aviation
mishap. The Coast Guard will continue to emphasize that maintaining
professionalism requires continual learning, mastery of the operations,
and knowledge of policy, regulation and mission requirements.
Question 5. Since September 11, 2001, Coast Guard aviation,
specifically helicopters, has adopted new mission capabilities to
support the service's new homeland security missions. Each new mission
requires qualifications and training requirements for pilots and
aircrew on top of traditional training. Despite these new
responsibilities, the Coast Guard has the same number of aircraft and
pilots as it did pre-9/11.
Does the Coast Guard need more aircraft, pilots and aircrew to
cover these new special missions? Are aircrews being overextended? Is
the expertise and proficiency level being diluted as pilots train for
these new special missions? Does Coast Guard Aviation even need to
perform these new special missions?
Answer. Coast Guard minimum aviation asset requirements are
outlined in the FY 2010 Revised Deepwater Implementation Plan Review
report to Congress. The Coast Guard balances its rotary wing training
and resource needs for special missions through the use of existing
assets and planned accomplishments in the FY 2012 President's Budget.
The special missions that Coast Guard aircrews have absorbed since
2001 have made adequate levels of proficiency a challenge. Managing
multiple qualifications is accomplished by flying a higher percentage
of mission hours for training.
The Coast Guard performs the Rotary Wing Air Intercept mission as a
military service in support of Department of Defense's OP NOBLE EAGLE
air defense mission. The Coast Guard's Airborne Use of Force and Fast
Roping capabilities were developed and utilized in our traditional Law
Enforcement role in the late 1990s, and as the Maritime Security
mission grew after September 11, 2001, the use of these latter two
capabilities expanded.
Question 6. You mentioned this disturbing trend in accidents in
your State of the Coast Guard speech and said training needs to lead
toward the higher level of proficiency and not just qualification. Can
you give an example of what you are now doing in your training programs
to achieve a higher level of proficiency? Will this require the Coast
Guard to narrow its mission focus?
Answer. For aviation, the Coast Guard has significantly modified
the aircrew grading system to better stratify individual performance
levels. The legacy grading system evaluated aircrew performance on a
Pass or Fail basis. The stratification allows evaluators to provide
more comprehensive feedback to pilots, improving proficiency.
For tactical, high risk boarding teams, Special Missions Training
Center (SMTC) in Camp Lejeune, NC, has revamped tactical and pursuit
training based on the results of a comprehensive study. SMTC has been
allocated new boats, allowing coxswains to be instructed on the same
equipment they use during everyday operations at their home units.
Prior to this initiative, coxswains were trained on dissimilar boats.
The SMTC training program has been improved by adding remedial training
options for basic tactical operator. Early returns show that this
remediation training has increased graduation rates while meeting the
same rigid standards for basic tactical operators. The study also
indicated a need for increased preparation prior to attending the basic
course and an increased/revised need for sustainment training at units
following course attendance. The Coast Guard has initiated these
changes at field units.
For surf boats, a new four-week surfman course was instituted in an
effort to increase the number of qualified surfman by providing fifty
hours of operations in the surf. This course, coupled with the existing
Standard Surfman Training Package, has substantially increased the
number of qualified surfman in the Coast Guard through standardized
proficiency training, resulting in fewer operational mishaps in the
high-risk surfman community.
These initiatives do not require the Coast Guard to narrow its
mission focus.
______
Response to Written Questions Submitted by Hon. Bill Nelson to
Admiral Robert J. Papp, Jr.
Question 1. Coast Guard personnel continue to staff the Gulf Coast
Incident Management Team, performing standard cleanup operations such
as manual removal of oily debris and mechanical recovery of oily marsh,
and working on special operations such as the Submerged Oil Mats
program. Response activities continue but have diminished substantially
compared to the height of operations.
The Coast Guard's response to the oil spill required a significant
amount of resources from a Service that operates under a small budget,
when compared to the other Armed Forces. Answers to these questions
will hopefully highlight some concern within the Coast Guard, as to
their ability to support future demand for their capabilities. Over the
course of the oil spill, how much did Coast Guard spend on the
response? To what extent do these funds come from the Oil Spill
Liability Trust Fund? If a large spill occurred again given the current
funding levels, would CG be able to mount an effective response?
Answer. Over the course of the oil spill, the Coast Guard spent
$400,640,847 (as of July 27, 2011). This value does not include Coast
Guard directed payments from the Oil Spill Liability Trust Fund (OSLTF)
to other government agencies. Of the aforementioned amount,
$129,707,889 of that funding came from the OSLTF.
The National Response System contains a series of plans that are
used to respond to a spill and the resources required will vary for any
given spill. However, recent experience with several complex oil spills
including the M/V COSCO BUSAN, the T/V EAGLE OTOME, and DEEPWATER
HORIZON underscore the importance of having proficient and readily
deployable incident managers and pollution responders throughout the
Coast Guard.
The President's FY 2012 budget request addresses critical resource
and capacity gaps in marine environmental response in two ways. First,
the President's FY 2012 budget request seeks funding for Coast Guard
military and civilian personnel to enhance the Service's marine safety
and marine environmental response capacity through the establishment of
a Coast Guard National Incident Management Assist Team. It also
strengthens oil pollution research by funding a full-time Executive
Director of the Interagency Coordinating Council for Oil Pollution
Research.
Question 2. I am increasingly concerned with the USCG's acquisition
programs and how problems with it have contributed to your current
operational hour gaps, meaning there are missions that the American
people expect the Coast Guard to accomplish, but you're not able to.
One such area is the patrol boat operational hour shortfall in the tens
of thousands per year. What missions are not being met by your patrol
boats? Are patrol boats the only place where you're seeing this
operating hour gap? If not, where else do you have shortfalls? The
House recently recommended stripping funding for 2 of your 6 Fast
Response Cutters due to structural deficiencies . . . can you respond
to that and what affect would that have on the operating hour
shortfall?
Answer. To establish a consistent baseline from which to measure,
the patrol boat operational hour capacity of 99,400 hours is based on
programmed operational hours available in 1998 with a full complement
of 49 110-ft WPBs. In 2010 the 110-ft WPB fleet patrolled 70,065 hours
resulting in an operational hour gap of 29,335 hours (29.5 percent
short of the 1998 baseline). Both the hour and hull gaps are acutely
manifested in the Coast Guard District Seven's area of responsibility,
which is programmed for 47,400 hours (53 percent of all Coast Guard
Patrol Boat hours). The below graph illustrates the patrol boat
operational hour gap and the future projection to close the gap based
on the Fast Response Cutter (FRC) delivery schedule:
Patrol Cutter Transition Schedule--FY 2012 President's Budget Request
The primary missions of the 110-ft WPB are Counter-Drug, Alien
Migration Interdiction Operations, Search and Rescue, Ports Waterways
and Coastal Security and Living Marine Enforcement. All missions
continue to be met by the patrol boat fleet but at a reduced
operational capacity. This reduced capacity inhibits the Coast Guard's
ability to patrol and enforce applicable laws/regulations and reduces
overall effectiveness across the entire mission set.
The patrol boat gap is projected to start closing in FY 2012 with
the delivery of the first FRC in 2011. Each FRC is designed to be
operated 2,500 hours annually. Following delivery, testing, and
evaluation, these new cutters will immediately contribute toward
mitigating shortages in WPB operational capacity. Specifically, the
first 12 FRC hulls will be home-ported in Miami and Key West, FL, where
the patrol boat gap is the most acute. Based on an out-year FRC
delivery schedule of six FRC deliveries per year projected in the FY
2012-2016 Capital Investment Plan, the 1998 baseline is anticipated to
be met in FY 2016. Delivering four FRCs annually equates to a 5,000
operational hour impact that would shift the attainment of the 1998
baseline and closure of the patrol boat gap beyond 2020. To mitigate
operational impacts of any delays in FRC delivery, the 110 ft WPBs, 29
of 41 which are beyond their 20-year service life, would continue to
operate until replaced by FRCs.
Question 3. GAO recently testified that you have been working on a
Fleet Mixed Analysis since October 2008 and still have not released its
findings. GAO also said that the initial numbers you're holding onto
are not feasible in the current fiscal climate. In May, House
Appropriators claim you've been conducting this analysis since 2004 and
have yet to submit its findings. This lack of transparency is
concerning because if you have mission requirements, and don't have the
resources to accomplish them, we as Congress need to know. When will
the Fleet Mixed Analysis be ready? Are you getting some independent
help with this analysis or has it been internal to the Coast Guard?
Answer. The Fleet Mix Analysis was delivered to Congress on July
29, 2011. The Coast Guard used a consultant to complete this study.
Question 4. For your Deepwater acquisition programs, GAO reports
$3.8B cost overruns when compared to your 2007 baseline and an overall
35 percent overrun for programs that were re-base lined. In our current
fiscal state, this is unacceptable and points to re-occurring issues in
the way the USCG does business. How do you account for such cost growth
and what is the Service doing to address the overarching problems with
your acquisition processes?
Answer. In 2007, the Coast Guard assumed responsibility as Lead
System Integrator (LSI). Integrated Deepwater System acquisition
projects were disaggregated into individual Acquisition Program
Baselines, leveraging project estimates that were provided by ICGS
under the legacy Deepwater construct. The projected total acquisition
costs were $24.2 billion and the Life Cycle Cost Estimates (LCCE) were
approximately $180 billion. Efforts to consolidate the Acquisition
Directorate, assume Lead System Integrator responsibilities, and
implement the Blueprint for Continuous Improvement have better equipped
the Coast Guard to manage costs, schedules and contractor performance.
Over the past four years, the Coast Guard has focused on improving
cost management for all related projects and budget accounts, and
significantly improved its ability to acquire in an integrated fashion
with rigorous, coordinated participation from technical authorities and
sponsors.
As the Coast Guard assumed this role, our focus included a robust
analysis of all cost estimates, partnering with the U.S. Navy and
third-party technical experts.
Question 5. With the permanent decommissioning of 1 of the Coast
Guard's 2 heavy polar icebreakers, we're losing the ability to support
national interests in the region, which is especially alarming since
Russia maintains 8 heavy icebreakers. New shipping routes that were
previously frozen and unnavigable are now being used by vessels to
reduce transit times. You recently stated that, ``because of the
condition of the icebreakers, we are rapidly losing the expertise, and
we don't have the resources to respond up there to a major emergency.''
Is the Coast Guard equipped to properly handle this mission? What
efforts are under way to ensure we maintain a good grip on our national
interests in that region?
Answer. The Coast Guard mission demand for icebreakers in the
Arctic has been primarily in support of National Science Foundation,
National Oceanic and Atmospheric Administration, and National
Aeronautics and Space Administration science missions. As the ice cover
diminishes, we can expect increased maritime activity, especially in
the form of vessel transits and natural resource exploration. Coast
Guard vessel presence and capability will become key factors for
meeting national response requirements. While Coast Guard could
potentially respond during extended open water periods of the summer
using Alaska's buoy tenders, the Coast Guard only has one operational
icebreaker (HEALY) that is able to work in ice-covered waters in summer
and the shoulder seasons when Arctic sea ice covers much of the ocean.
The Coast Guard's reactivation of POLAR STAR for full mission
capability will be complete in 2013. DHS has proposed an icebreaker
acquisition analysis in the 2012 President's Budget which will help
define the long-term icebreaking solution well beyond the expected
service life of the POLAR STAR.
______
Response to Written Questions Submitted by Hon. Olympia J. Snowe to
Admiral Robert J. Papp, Jr.
Question 1. The Coast Guard Authorization Act of 2010 outlined a
consultation process for sharing of technical expertise between the
U.S. Coast Guard and Department of Defense, with the objective of
obtaining the Navy's acquisition program management expertise. Has the
Coast Guard initiated the memorandum of understanding to facilitate
technical expertise sharing? What is the status of that process?
Answer. The Coast Guard presently has approximately 80 interagency
agreements and memorandums of agreement, primarily with the DOD and
U.S. Navy. Those agreements are primarily for acquisition management
and technical expertise sharing. The GAO has verified this fact in
their April 2011, report GAO-11-480. In this report, the GAO made a
recommendation that the Coast Guard develop and maintain a repository
for information on Federal partnerships and Memorandums of
Understanding (MOUs). The Coast Guard is in the process of establishing
this repository to ensure that the process for sharing of technical
expertise between the U.S. Coast Guard and Department of Defense
outlined in the Coast Guard Authorization Act of 2010 is implemented.
Once established, the Coast Guard will assess if an additional
Memorandum of Understanding to facilitate technical expertise sharing
is necessary.
Question 2. What are the differences in the acquisitions
authorities of the U.S. Coast Guard and the Navy?
Answer. The U.S. Coast Guard and Navy acquisition authorities are
codified in the following three titles of the U.S. Code:
Title 10 Armed Forces
Title 14 Coast Guard
Title 41 Public Contracts
Implementation of the law is established in the Code of Federal
Regulations (CFR) and most of the Coast Guard and the Navy acquisition
authorities are located in two titles of the CFR:
Title 41 Public Contracts and Property Management
Title 48 Federal Acquisition Regulations System (FAR)
Coast Guard acquisition authority is further defined in DHS and
Coast Guard regulations, including the Department of Homeland Security
(DHS) Homeland Security Acquisition Manual (HSAM), DHS Acquisition
Management Directive 102-01 Revision 01 of 20 January 2010, and Coast
Guard Major Systems Acquisition Manual (MSAM). Navy acquisition
authority is further defined by the Defense Federal Acquisition
Regulation Supplement (DFARS) which is part of the FAR. From the DFARS,
the Navy acquisition authority is further refined in DOD and Navy
regulations.
In general, many of the Coast Guard and the Navy acquisition
authorities are the same. There are, however, significant differences
in the area of major acquisition programs, as that portion of Title 10
applicable to Major Acquisition Programs (Chapter 144) is not
applicable to the Coast Guard (the term ``major defense acquisition
program'' means a Department of Defense acquisition program,'' 10
U.S.C. 2430(a)). The Defense Acquisition Regulation Supplement also
contains additional authorities that are DOD-specific.
One other notable difference is that the Navy has well established
multi-year/multi-ship authority. Multi-year/multi-ship contracts allow
the procurement of known requirements for up to 5 years, even though
the total funds ultimately to be obligated may not be available at the
time of contract award.
Question 3. The Coast Guard Authorization Act of 2010 set forth a
number of changes that will affect fishing vessels operating in Federal
waters, including new construction standards for vessels built after
July 1, 2012. While the high fatality rates that plague the fishing
industry are deeply troubling, the implementation of new training,
classing and loadline requirements are of concern to the fishing
industry, particularly those already enduring regulatory changes that
stress their financial viability. When does the Coast Guard expect to
promulgate rules on the implementation of new training requirements?
How can the Coast Guard ensure that the new construction requirements
will not deter the fishing industry from pursuing necessary upgrades or
vessel replacements?
Answer. The Coast Guard does not have discretion to modify or
exempt the requirements for construction standards and classing of
vessels as mandated by the Coast Guard Authorization Act (Act) of 2010.
The new requirements may or may not deter the fishing industry from
pursuing necessary upgrades or vessel replacements and impact their
financial viability. However, the industry will be involved in
developing new alternate safety compliance program requirements for
older vessels and vessels altered after July 1, 2012, so that the
impact of these requirements will be taken into consideration in the
adoption of the final alternate safety program requirements.
As set forth in the Act, construction standards apply to new
vessels. Vessels built after January 1, 2010, are less than 50 feet
overall in length, and operate beyond three nautical miles from the
baseline, must at least meet the safety standards established for
recreational vessels. Vessels built after July 1, 2012, are at least 50
feet overall in length, and operate beyond three nautical miles from
the baseline, must meet all survey and classification requirements
prescribed by the American Bureau of Shipping or other similarly
qualified organization. For instance, Det Norske Veritas (DNV), a
similarly qualified organization, is currently developing rules for
survey and classification of fishing vessels and hopes to have them
completed by early 2012.
Vessels that are upgraded through a significant alteration or a
substantial change to its dimensions or type will have to meet
standards of an alternate safety compliance program. This applies to
vessels built before July 1, 2012 and altered after that date, are at
least 50 feet overall in length, and operate beyond three nautical
miles from the baseline. The alternate safety compliance program
requirements will be developed by the Coast Guard in cooperation with
the industry and consultation with and recommendations from the
Advisory Committee, and must be implemented not later than January 1,
2017. The alternate safety requirements may be developed for specific
regions and fisheries. All vessels meeting the criteria above, whether
altered or not, and are 25 years of age or older must comply with an
alternate safety program after January 1, 2020.
______
Response to Written Questions Submitted by Hon. Roger F. Wicker to
Admiral Robert J. Papp, Jr.
Question 1. A multi-year contract would save tax payer money and
stabilize the industrial workforce by guaranteeing procurement beyond a
single year. Now that the NSC design is mature, would you support
multi-year contract authority for this program, recognizing that some
changes in your current acquisition strategy may be required?
Answer. We cannot execute the National Security Cutter (NSC)
project under a multi-year procurement construct given the current NSC
contract structure.
Question 2. Assuming NSCs 6, 7, and 8 are contracted in FY 2013,
2014, and 2015, respectively, can you quantify how much they would cost
if contracted individually? Similarly, can you quantify the cost of
these three NSCs if purchased with multiyear contract authority,
assuming a Congressional funding commitment in FY 2013?
Answer. Contracting individually for National Security Cutters
(NSCs) 6, 7, & 8 are consistent with the current FY 2012-2016 NSC
Capital Investment Plan (CIP) for single-year funding of each NSC.
Under the assumptions of the CIP, the total planning cost for each NSC
and related project costs are as follows:
----------------------------------------------------------------------------------------------------------------
Single-Year Funding Appropriation
Segment Amount Year of Planned Funding
----------------------------------------------------------------------------------------------------------------
NSC #6 $775M 2013
----------------------------------------------------------------------------------------------------------------
NSC #7 $795M 2014
----------------------------------------------------------------------------------------------------------------
NSC #8 $815M 2015
----------------------------------------------------------------------------------------------------------------
Structural Enhancement for NSCs #1/#2 $38M 2015
----------------------------------------------------------------------------------------------------------------
Project Close-out $45M 2016
----------------------------------------------------------------------------------------------------------------
With Multi-year contract authority, all three NSCs could be ordered
together. It is possible that savings could accrue due to economic
order quantities, increased productivity, and improved scheduling.
Coast Guard estimates that the potential savings derived with Multi-
year contract authority could be approximately $85 million as shown
below.
----------------------------------------------------------------------------------------------------------------
Coast Guard estimates for Single-Year and Multi-Year NSC Funding Scenarios
-----------------------------------------------------------------------------------------------------------------
Segment Single-Year Funding Multi-Year
----------------------------------------------------------------------------------------------------------------
NSC #6 $775M $750M
----------------------------------------------------------------------------------------------------------------
NSC #7 $795M $765M
----------------------------------------------------------------------------------------------------------------
NSC #8 $815M $785M
----------------------------------------------------------------------------------------------------------------
Structural Enhancement for NSCs #1/#2 $38M $38M
----------------------------------------------------------------------------------------------------------------
Project Close-out $45M $45M
----------------------------------------------------------------------------------------------------------------
Est. Reduction from Single-Year Funding $85M
----------------------------------------------------------------------------------------------------------------
Question 3. In light of the proposed decommissioning of Pascagoula,
Mississippi-based ``Patrol Coastal'' Cutters, does the Coast Guard have
a long range plan to replace these cutters in Pascagoula, and cover the
potential mission gap in the Gulf of Mexico region?
Answer. The return of the PC-179's to the Navy, which were
originally transferred to the Coast Guard as part of a mitigation
strategy for the patrol boat operational hour gap, results in a short-
term loss of patrol boat operational capacity in mission areas that
include Counter-Drug (CD), Alien Migration Interdiction Operations
(AMIO) and Living Marine Resources/Other Law Enforcement (LMR/OLE).
This capacity will be filled by the delivery of Sentinel Class patrol
boats beginning in early 2012, several of which will be homeported in
the Gulf Coast region.