[Senate Hearing 113-]
[From the U.S. Government Publishing Office]




 
  DEPARTMENT OF HOMELAND SECURITY APPROPRIATIONS FOR FISCAL YEAR 2014

                              ----------                              


                         TUESDAY, MAY 14, 2013

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 3:12 p.m., in room SD-138, Dirksen 
Senate Office Building, Hon. Mary L. Landrieu (chairman) 
presiding.
    Present: Senators Landrieu, Cochran, and Moran.

                         DEPARTMENT OF DEFENSE

                            U.S. Coast Guard

STATEMENT OF ADMIRAL ROBERT J. PAPP, JR., COMMANDANT

             OPENING STATEMENT OF SENATOR MARY L. LANDRIEU

    Senator Landrieu. Good afternoon. I'd like to call the 
subcommittee to order. Let me apologize for the delay, but I 
had to be on the floor for an amendment on flood insurance, 
which is another important issue, as important as the Coast 
Guard for the State of Louisiana and other States. So I 
apologize, but I am happy to get underway.
    Admiral Papp, welcome to our oversight subcommittee hearing 
today.
    This meeting has been called to review the budget proposed 
for the Coast Guard. Admiral, I want to thank you for your 
extraordinary service to our country, for the way that you lead 
the men and women of the Coast Guard, for your energetic and 
visionary approach to the work that you are doing. We hold the 
men and women of the Coast Guard in the highest regard on this 
subcommittee and the people that I represent in Louisiana think 
very well of the Coast Guard under a variety of different 
leaders, yourself included.
    We consistently hear stories of the Coast Guard providing a 
great service to the public, such as the recent high-profile 
rescue of 14 sailors aboard the HMS Bounty, a historic sailing 
vessel, when it got caught in Hurricane Sandy. Senator Cochran 
and I, who is here today, understand many rescue missions are 
conducted off the coast of Mississippi and Louisiana routinely, 
and this was a very high-profile case. Ninety miles off the 
coast of North Carolina, Coast Guard helicopter pilots and 
rescue swimmers fought 30-foot seas, 60-knot winds, and 
torrential rain to rescue the HMS Bounty crew. They rescued 13. 
Unfortunately, the captain of the ship was not recovered. But 
it is stories like these that truly make us all proud of our 
Coast Guard.
    Our job here today and through the appropriations process 
is to ensure that the next generation of Coast Guard men and 
women has the tools they need to accomplish their many missions 
and that taxpayer dollars are allocated wisely. I know that you 
share that goal.
    That's why I am very disappointed in the President's 2014 
budget request for the Coast Guard. I understand that difficult 
tradeoffs need to be made in this budget climate, but I believe 
the top line given to the Coast Guard in the administration's 
budget request is wholly inadequate.
    In 2012, the Coast Guard responded to 19,700 search-and-
rescue cases, saved 3,500 lives, interdicted 30,000 
undocumented migrants, detained 352 suspected smugglers, 
inspected 25,000 ship containers, and the best statistic I 
think is, seized 107 metric tons of cocaine, more cocaine than 
all other Federal agencies combined. That expresses to me the 
width and breadth of the Coast Guard mission, which you all 
carry out from Rhode Island to Alaska, and in other places in 
the world as well. I am concerned that the Coast Guard's 
ability to maintain performance measures like these is 
threatened if this budget that has been presented to us stays 
as it is.
    The President's fiscal year 2014 discretionary budget 
request is $7.993 billion, almost 8.5 percent below last year's 
level, which was, I thought, very modest. The budget request 
includes a reduction of 850 military billets; moves 1,000 
reservists to inactive status; reduces capital expenditures by 
38 percent, a level not seen since 2003; and in my view puts 
the Coast Guard further behind in acquiring the assets it needs 
to fulfill its important missions, just a few of which I 
outlined earlier in this statement.
    This capital investment request the President submitted for 
the Coast Guard is, no pun intended, a sea change from the $2.5 
billion that you testified, Admiral Papp, as the amount 
required to properly replace the Coast Guard's aging stock of 
ships, aircraft, and other infrastructure. When you testified 
before the House in 2011 you said, ``It would really take close 
to about $2.5 billion a year if we were to do all things that 
we would like to do to sustain our capital plant.'' In 
comparison, this budget requests only $951 million.
    I don't see how we can possibly replace the unreliable 
fleet that we have. Some of these ships, we know them well, are 
47, 50 years old. We built some of them in Louisiana. They are 
not all, of course, built in our State or on the gulf coast, 
but we know these ships well. How long can a ship last doing 
the kind of work that we require of them and their crew?
    While the budget does include $660 million for the seventh 
national security cutter (NSC), and I am very happy about that 
because it is a priority for our subcommittee, almost every 
other capital priority is either reduced substantially or 
completely eliminated. The request essentially overwrites the 
congressional direction that we gave in 2012 and 2013 requiring 
you to procure six fast response cutters per year, eliminating 
$30 million in cost savings that we had anticipated.
    No funding is provided for new aviation assets or military 
housing despite known backlogs and despite the understanding 
that the Coast Guard and their families are sometimes placed in 
very remote areas by the nature of the mission they are asked 
to do. It's not like you can run down the road and get 
affordable community-built housing. Sometimes Coast Guard men 
and women are the only people within miles.
    To make matters worse, the 5-year Capital Investment Plan 
the subcommittee recently received calls for a radical change 
to Coast Guard recapitalization efforts in future years. If 
enacted, the plan will likely delay completion of the offshore 
patrol cutter, decrease the number of fast response cutters to 
a level that jeopardizes the program, stop the acquisition of 
all new aircraft, and scale back investments in deteriorating 
shore facilities.

                           PREPARED STATEMENT

    So today I want to explore the impacts this investment plan 
will have on the Coast Guard's mission. I'm going to shorten my 
statement because of the lateness of getting started, but I 
have to say that we added funding last year to maintain aging 
assets, enhance oil spill response capabilities, and restore 
essential mission hours for drug and migrant interdiction. 
These are just not the chairman's priorities, Mary Landrieu's 
priorities, or the Senator from Louisiana priorities. These are 
priorities for our Nation. That's what the Senators of both 
parties tell me they want. I just don't see how we can 
accomplish what I know is necessary to keep our country safe 
and to complete these missions with some degree of 
professionalism with the budget that we have before us.
    With that, I'm going to turn it over to Senator Cochran for 
his opening statement. Then Senator Moran. Thank you for 
joining us.
    [The statement follows:]
             Prepared Statement of Senator Mary L. Landrieu
    Good afternoon. I call the subcommittee to order.
    Today I welcome the Commandant of the Coast Guard, Admiral Robert 
J. Papp, to discuss the Coast Guard's fiscal year 2014 budget request. 
I want to thank Admiral Papp for his service to this country and for 
leading the men and women of the Coast Guard.
    Admiral Papp, we hold the men and women of the Coast Guard in the 
highest regard on this subcommittee. We consistently hear stories of 
the Coast Guard providing great service to the public, such as the 
rescue of 14 sailors aboard the HMS Bounty, a historic sailing vessel, 
when it got caught by Hurricane Sandy. Ninety miles off the shores of 
North Carolina, Coast Guard helicopter pilots and rescue swimmers 
fought 30-foot seas, 60-knot winds, and torrential rain to rescue the 
crew. Unfortunately, the captain of the ship was not recovered. It is 
stories like these that make us proud of our Coast Guard.
    Our job here today and through the appropriations process is to 
ensure that the next generation of Coast Guard men and women has the 
tools they need to accomplish their many missions and that taxpayer 
dollars are allocated wisely. I know that this is a goal you share.
    That is why I am so disappointed with the President's fiscal year 
2014 budget request for the Coast Guard. I understand that difficult 
trade-offs need to be made in this budget climate, but I believe the 
topline given to the Coast Guard in the President's budget request is 
wholly inadequate.
    In fiscal year 2012, the Coast Guard responded to 19,790 search-
and-rescue cases, saved 3,500 lives, interdicted 3,000 undocumented 
migrants, detained 352 suspected smugglers, inspected 25,000 ship 
containers, and seized 107 metric tons of cocaine. The Coast Guard 
seizes more cocaine annually than all other Federal agencies combined. 
I am concerned with the Coast Guard's ability to maintain performance 
measures like these if the President's budget is enacted.
    The President's fiscal year 2014 discretionary budget request for 
the Coast Guard is $7.993 billion, 8.36 percent below last year's 
enacted level. The budget request includes a reduction of 850 military 
billets, moves 1,050 reservists to inactive status, and reduces capital 
expenditures by 38 percent to a level not seen since 2003, putting the 
Coast Guard further behind in acquiring the assets it needs to fulfill 
its missions. This capital investment request the President submitted 
for the Coast Guard is a sea change from the $2.5 billion you spoke 
about as the yearly amount required to properly replace the Coast 
Guard's aging stock of ships, aircraft, and other infrastructure. When 
you testified before the House in 2011, you said: ``It would really 
take close to about $2.5 billion a year if we were to do all the things 
that we would like to do to sustain our capital plant.'' In comparison, 
this budget requests far less than that amount: $951 million to be 
precise. I don't see how you can possibly replace your old and 
unreliable fleet within this budget.
    While the budget does include $616 million for the seventh national 
security cutter, almost every other capital priority is either reduced 
substantially or eliminated. The request essentially overwrites 
congressional direction in 2012 and 2013 requiring you to procure six 
fast response cutters per year, eliminating $30 million in cost savings 
that we anticipated. No funding is provided for new aviation assets or 
military housing despite known backlogs.
    To make matters worse, the 5-year Capital Investment Plan the 
subcommittee recently received calls for a radical change to Coast 
Guard recapitalization efforts in future years. If enacted, the plan 
will: likely delay completion of the offshore patrol cutter; decrease 
the number of fast response cutters to a level that jeopardizes the 
program; stop the acquisition of new aircraft; and scale back 
investment in deteriorating shore facilities. Today, I want to explore 
the impacts this investment plan will have on Coast Guard missions, 
such as interdicting drugs in the transit zone, managing a mass 
migration, oil spill response, fisheries enforcement, and the need to 
increase our presence in the Arctic.
    In the fiscal year 2013 DHS Appropriations Act, Senator Coats and I 
worked with the other members of the subcommittee to strengthen the 
Coast Guard's capital investment program. We funded:
  --six, instead of two, fast response cutters;
  --long lead time materials for the seventh national security cutter 
        as well as construction costs for the sixth national security 
        cutter;
  --plans and designs for new offshore patrol cutters;
  --one new C130J aircraft;
  --the 18th maritime patrol aircraft, including a mission pallet and 
        spares not requested in the budget but needed to operate 
        effectively; and
  --critically needed military family housing in Kodiak, Alaska.
    Operationally, we added funding to maintain aging assets, enhanced 
oil spill response capabilities, and restored essential mission hours 
for drug and migrant interdiction.
    The Coast Guard shouldn't always depend on Congress to plug these 
holes.
    I look forward to examining your budget in more detail today so we 
can make sound decisions about the resources and assets the Coast Guard 
men and women need today and in the future.
    I now recognize Senator Coats for any opening remarks he may wish 
to make.
    Following Admiral Papp's statement, each member will be recognized 
by order of arrival for up to 5 minutes for any statement and 
questions.
    I now recognize Admiral Papp for his statement.

                   STATEMENT OF SENATOR THAD COCHRAN

    Senator Cochran. Madam Chairman, I am pleased to join you 
and the other subcommittee members in welcoming the Commandant 
of the U.S. Coast Guard to review the service's annual budget 
request. It's my hope that we will be able to recommend the 
level of funding required to support the U.S. Coast Guard's 
important missions.
    From the search-and-rescue case of the tall ship HMS Bounty 
to leading efforts in reopening the ports of New York and New 
Jersey after Hurricane Sandy, and in my State of Mississippi, 
from recent hurricanes which threatened their own facilities in 
New Orleans in the case of the Coast Guard, the Coast Guard has 
continued to provide important public service in so many 
different ways.
    We look forward to working with you to understand the 
appropriate funding levels that are needed to support the 
important work of the men and women of the U.S. Coast Guard who 
work hard to protect our coasts and our citizens. Thank you.
    Senator Landrieu. Thank you.
    Senator Moran.
    Senator Moran. Madam Chairman, I have no opening statement 
other than to say, Admiral, welcome, and to express, as a land-
locked Kansan, the value of the Coast Guard to our entire 
country and my great appreciation for the men and women who 
serve in the Coast Guard. Thank you very much, Admiral.
    Senator Landrieu. Thank you.
    Admiral, please proceed.

            SUMMARY STATEMENT OF ADMIRAL ROBERT J. PAPP, JR.

    Admiral Papp. Madam Chairman, Senator Cochran, Senator 
Moran, thank you for having me here today.
    I would like to deviate just for a moment from my prepared 
remarks to address a deplorable issue that I am infuriated by 
that is confronting the Armed Forces today, and I want to take 
this opportunity to make a public statement in terms of my 
feelings in this regard.
    A little over 1\1/2\ years ago, I communicated with the 
entire Coast Guard, every member of the Coast Guard. I do that 
through something called Shipmates Messages. In Shipmates No. 
19, the title was ``Respecting Our Shipmates: Duty Demands 
Courage.'' I would just like to read a couple of phrases from 
that message.
    When I assumed my duties as Commandant, I told you that 
respecting our shipmates is one of my four guiding principles. 
Sexual assault, hazing, harassment, and discrimination 
undermine morale, degrade readiness and damage mission 
performance. These and other similar acts of misconduct break 
our obligation to one another. Each incident of sexual assault, 
hazing, harassment, or discrimination is a deliberate act that 
violates law, policy, and service standards.
    We will not tolerate this behavior in the Coast Guard. We 
will intervene to prevent or halt these acts when they are 
occurring. We will investigate and discipline those who have 
violated law and service policy. And let me be clear, there are 
no bystanders in the Coast Guard. Our duty to respect our 
shipmates demands each of us to have the courage to take 
immediate action to prevent or stop these incidents. Your duty 
as a coastguardsman is to intervene, prevent or halt it and 
report it. Failure to help a shipmate in those circumstances 
demonstrates a lack of courage that is contrary to our core 
values. I expect every coastguardsman will display the same 
courage in those circumstances as they would in rescuing 
someone in peril at sea.
    Americans must have confidence that the Coast Guard men and 
women understand their duty and are committed to our service. 
Commanding officers and officers in charge shall read this 
message at the next quarters or appropriate muster to ensure my 
expectations and intent are clear.
    I have repeated that message both in my State of the Coast 
Guard speech this year and when I've been traveling around the 
country talking to my senior leaders. In fact, when I leave 
here today, I'll be going down to Norfolk to speak to all my 
senior flag officers from the Atlantic area and probably close 
to about 2,000 coastguardsmen down there. We are taking this 
seriously, and certainly when we get into the questions and 
answers, if there are any questions regarding our sexual 
assault program, I would be happy to answer them.
    But I know we are here today to talk about the fiscal year 
2014 budget, and I will begin by thanking you for your support 
in the 2013 budget and the supplemental for Hurricane Sandy. 
Unfortunately, much like the weather and seas that were 
produced by Sandy, and we face those weather and seas generally 
on a daily basis, the Coast Guard cannot control the fiscal 
environment in which we operate.
    The fiscal year 2014 budget sustains the most critical 
frontline operations while funding our most critical 
acquisition projects. In the current fiscal environment, this 
required tough decisions, informed by my highest priorities. 
These were difficult decisions for me and for our service, but 
they were the best decisions to ensure that we provide the next 
generation of coastguardsmen the tools required to protect our 
Nation.
    We are making great strides in recapitalizing the aging 
fleet. In October, we will christen the fourth national 
security cutter. On Friday, we celebrate the keeling of No. 5, 
and the production contract for No. 6 was awarded just 2 weeks 
ago. Taking into account inflation and other factors within the 
contract for earlier NSCs, the cost for No. 6 was nearly the 
same as No. 4 and No. 5. This illustrates the maturity of this 
project, the stable and efficient production line, and the 
professionalism and achievements of our Coast Guard acquisition 
corp.
    These cutters are doing amazing work. On our most recent 
patrol, Waesche interdicted contraband worth an estimated $7.5 
million, and just last week Bertholf  disrupted the shipment of 
cocaine valued at more than $5 million.
    These cutters are also key to meeting the growing demands 
in the Bering Sea in the Arctic. With the extreme conditions 
and lack of shore site infrastructure, the operational 
effectiveness and command-and-control capabilities of the 
national security cutter are critical to our success. As the 
receding Arctic ice gives way to increased human and economic 
activity, the Coast Guard must be present to ensure safety, 
security, and stewardship there, and we are preparing for 
future operations in this emerging maritime frontier.
    We've also taken delivery of the first five fast response 
cutters, the FRCs, and these too have proven to be amazing 
platforms. Several more will soon join the fleet, and No. 9 was 
launched last week.
    We have also taken delivery of 14 HC-144 aircraft, have 
contracted for our ninth HC-130J, and have completed life 
extending of our patrol boats and our medium endurance cutters.
    Despite these successes, we still must work to recapitalize 
the Coast Guard ships, boats, and aircraft that the Nation 
needs. I'm happy to report that I received strong support from 
the Secretary and the President on my highest acquisition 
priorities, including the funding for the seventh national 
security cutter in the 2014 budget.
    So as I look back on the successes of our past year, I have 
never been more convinced about the value our Coast Guard 
provides to the Nation. While mindful of the current fiscal 
environment, I remain optimistic about the future of the Coast 
Guard. It is my duty to look beyond the annual budget cycle and 
to prepare and adapt the service and keep it moving forward to 
address the greatest maritime safety and security risks to the 
Nation, not only now but in the future.
    In December, we were reminded of the dangers of our duties 
as I presided at a memorial service for Senior Chief Boatswains 
Mate Terrell Horne of the Coast Guard cutter Halibut. He was 
killed by smugglers when they rammed his Coast Guard pursuit 
boat near San Diego. I was reminded of it once again as Mrs. 
Horne, Rachel, and her three young sons, Kade, Miller and 
Wells, came into my office this morning in preparation for the 
ceremony to honor their husband and their father at the wall 
for the law enforcement officers.
    The men and women of the Coast Guard will give their all 
and make sacrifices every day, putting their country first, and 
I have never been prouder of them, and they have never been 
better. Working together, we owe them our very best efforts to 
provide the support they need.

                           PREPARED STATEMENT

    This subcommittee has long supported the men and women of 
the Coast Guard. I appreciate that, and I thank you for 
recognizing their sacrifices. On behalf of all my Coast Guard 
shipmates, I say thank you.
    I look forward to answering your questions.
    [The statement follows:]
           Prepared Statement of Admiral Robert J. Papp, Jr.
    Good afternoon Madam Chair Landrieu and distinguished members of 
the committee. Thank you for the continuing support you have shown to 
the men and women of the United States Coast Guard, including the 
funding provided in the Consolidated and Further Continuing 
Appropriations Act, 2013 to recapitalize the aging fleet and sustain 
frontline operations.
    This year marks our 223rd year of protecting those on the sea, 
protecting the Nation from threats delivered by the sea, and protecting 
the sea itself. The Coast Guard is the Nation's maritime first 
responder. We are vested with unique authorities, equipped with capable 
cutters, boats, aircraft and infrastructure, and are composed of the 
best people the Nation has to offer. We are Semper Paratus--``Always 
Ready'' to meet the Nation's evolving maritime safety, security and 
stewardship needs. We are locally based, nationally deployed and 
globally connected.
    I am here today to discuss the Coast Guard's fiscal year 2014 
budget request. Before discussing the details of the request, I would 
like to take this opportunity to highlight some of the Coast Guard's 
recent operational successes, and our value and role in the Department 
of Homeland Security (DHS) and in service to the Nation.
    Over the past year, Coast Guard men and women (Active Duty, 
Reserve, civilian, and auxiliarists), with strong support from our 
families, continued to deliver premier service to the public. When 
Hurricane Sandy threatened the eastern seaboard, the Coast Guard acted 
with the speed, agility and courage that America expects during natural 
disasters. In advance of the storm's landfall, we worked with the 
interagency, industry and State and local partners to ensure our ports 
and maritime transportation system were prepared. As the storm raged, 
our aircrews and cutters responded to the foundering HMS Bounty, 
rescuing 14 crewmembers from the 30-foot seas and 60-knot winds. In the 
Port Authority of New York and New Jersey, Coast Guard personnel 
restored the aids to navigation system within days; worked with U.S. 
Customs and Border Protection, the Army Corps of Engineers, local 
government and industry to reopen the port to commerce; helped de-water 
flooded tunnels leading to Manhattan, and contained 378,000 gallons of 
diesel fuel that had spilled into the Arthur Kill waterway when the 
storm surge caused the failure of shoreside fuel storage tanks.
    To prepare to meet the emerging challenges in the Arctic, we 
successfully completed Operation Arctic Shield, a 9-month interagency 
effort to assess our capabilities, including the deployment of a 
national security cutter and two of our ocean going, light ice capable 
buoy tenders, as well as the temporary assignment of two H-60 
helicopters 300 miles north of the Arctic Circle.
    Last year, the Coast Guard responded to 19,790 search-and-rescue 
cases and saved more than 3,500 lives; seized over 107 metric tons of 
cocaine and 56 metric tons of marijuana destined for the United States; 
seized 70 vessels, and detained 352 suspected smugglers; conducted more 
than 11,600 annual inspections of U.S. flagged vessels; conducted 4,600 
marine casualty investigations; conducted more than 9,000 Port State 
Control and Security examinations on foreign-flagged vessels; and 
responded to 3,300 pollution incidents.
    This past year we made great strides in recapitalizing the Coast 
Guard's aging fleet. In October we will christen the fourth national 
security cutter, Coast Guard cutter Hamilton. In addition to providing 
us off-shore presence in the Arctic during heightened summer activity, 
these remarkable ships have excelled in interdicting drug and migrant 
smuggling in the eastern Pacific and have enabled the Coast Guard to 
provide command and control, helicopter, and boat capabilities from the 
farthest reaches of the Pacific to the Bering Sea. I am also very 
pleased with our new fast response cutters (FRCs). To date, we have 
taken delivery of five of these new highly capable patrol boats. We 
have also taken delivery of 14 new HC-144 medium range surveillance 
aircraft, contracted for the ninth HC-130J and have nearly completed 
the H-60 conversion project. At the Coast Guard Yard, we completed work 
on the Patrol Boat Mission Effectiveness Project, extending the service 
lives of our 110-foot patrol boats, and continued work on the 
sustainment projects for our fleet of medium endurance cutters. We also 
recently completed an overhaul of the cutter Polar Star, returning the 
Nation's only heavy icebreaker to active service. None of these 
critical recapitalization milestones would have been reached without 
the strong support of the administration and the committees.
    As a military service, we provide unique, specialized capabilities 
as part of the joint force. But the Coast Guard is much more. We are 
the maritime arm of the DHS. We seek to prevent dangerous or illicit 
maritime activities, and if undesirable or unlawful events do occur, 
whether deliberate or accidental, to rapidly respond in order to 
protect the Nation, minimize the impact, and recover.
    Every day the Coast Guard acts to prevent and respond to an array 
of threats that, if left unchecked, could disrupt regional and global 
security, the economies of partner nations, access to resources and 
international trade. All of these are vital elements to our national 
prosperity. And it is this prosperity that spurs investment and global 
development, provides jobs, and provides the resources to pay for both 
our national security and our national defense. It is Coast Guard men 
and women, working every day in the maritime domain, who enhance our 
security, reinforce the rule of law, support stability at home and 
abroad, and increase our prosperity.
    The Coast Guard protects:
  --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.
  --The Nation from threats delivered by sea: enforcing laws and 
        treaties, securing our ocean resources, and ensuring the 
        integrity of our maritime domain from illegal activity.
  --The sea itself: regulating hazardous cargo transportation, holding 
        responsible parties accountable for environmental damage and 
        cleanup, and protecting living marine and natural resources.
                    fiscal year 2014 budget request
    The Coast Guard's fiscal year 2014 budget continues the critical 
balance between investment in current operations and recapitalization. 
The fiscal year 2014 budget strategically allocates resources to best 
mitigate current and long-term operational risks, while investing in 
new cutters, boats, aircraft, systems and infrastructure necessary to 
ensure the viability of the Coast Guard in the future.
    The Coast Guard's fiscal year 2014 strategic and budget priorities 
are to:
  --Build essential Coast Guard capability for the Nation;
  --Strengthen resource and operational stewardship; and
  --Sustain the most critical frontline operations.
    Highlights from our request are included in appendix I.
Build Essential Coast Guard Capability for the Nation
    Recapitalization is essential for the long term viability of the 
Coast Guard. The condition and serviceability of the Coast Guard's in-
service surface fleet, the aging of fixed and rotary wing air assets, 
and the projected timelines to replace these assets require continued 
investment in surface and air recapitalization programs to maintain the 
capability to operate. To strengthen DHS' layered security approach 
offshore, the fiscal year 2014 budget provides for the acquisition of a 
seventh national security cutter and two more fast response cutters, 
and continues pre-acquisition activities for the offshore patrol cutter 
and polar icebreaker. The budget also continues sustainment and 
conversion work on fixed wing and rotary wing aircraft, procurement of 
cutter boats, and investment in Command, Control, Communications, 
Computers, Intelligence, Surveillance, and Reconnaissance (C4ISR) 
systems.
Strengthen Resource and Operational Stewardship
    In fiscal year 2014, Coast Guard will decommission two high 
endurance cutters (WHECs) that are being replaced by more capable 
national security cutters. The Coast Guard will also consolidate 
regional assets where overlapping capabilities exist by closing air 
facilities in Newport, Oregon, and Charleston, South Carolina. The 2014 
budget ensures that our resources are aligned to our Nation's highest 
priorities in a manner that balances key investments for the future 
with sustaining essential investment in today's missions and 
capabilities that provide the highest return on investment.
Sustain the Most Critical Frontline Operations
    The fiscal year 2014 budget sustains the most critical frontline 
operations, including maintaining search-and-rescue coverage, 
protecting critical infrastructure and key resources, supporting safe 
navigation, safeguarding natural resources, protecting the environment, 
detecting and interdicting drugs and individuals attempting to enter 
the United States illegally, and supporting the Nation's foreign policy 
objectives.
                               conclusion
    The United States is a maritime nation. Foreign trade relies upon 
the safety and security of our Nation's ports and waterways. Coast 
Guard missions, authorities and capabilities are crucial to providing 
for that safety and security and preserving our national interests. We 
ensure the safe and secure flow of commerce, patrol our vast exclusive 
economic zone, fight maritime drug smuggling and human trafficking, 
provide the Nation's maritime first response force to both natural and 
manmade disasters, and protect our shores against transnational 
criminals, extremists, and others who seek to do us harm. We remain 
focused on protecting the United States as the strong maritime arm of 
the DHS. The Coast Guard's fiscal year 2014 budget request allocates 
resources to the highest priority initiatives to counter the most 
emergent threats, mitigate risks, and keep the maritime domain safe and 
secure. I request your full support for the funding requested for the 
Coast Guard in the President's fiscal year 2014 budget. Again, thank 
you for the opportunity to testify before you today. I am pleased to 
answer your questions.
                                 ______
                                 
              appendix i--fiscal year 2014 budget request
Build Essential Coast Guard Capability for the Nation
            Surface Assets: $743.0 Million (0 full-time equivalent 
                    (FTE))
    The budget provides $743.0 million for surface assets, including 
the following surface asset recapitalization and sustainment 
initiatives:
  --National Security Cutter (NSC).--Provides funding for the seventh 
        NSC; NSCs will replace the aging fleet of high endurance 
        cutters, first commissioned in 1967. The acquisition of NSC-7 
        is vital for performing DHS missions in the far off-shore 
        regions, including the harsh operating environment of the 
        Pacific Ocean, Bering Sea, and Arctic as well as providing for 
        robust homeland security contingency response.
  --Fast Response Cutter (FRC).--Provides production funding to procure 
        two FRCs. These assets replace the aging fleet of 110-foot 
        patrol boats, and provide the coastal capability to conduct 
        search-and-rescue operations, enforce border security, 
        interdict drugs, uphold immigration laws, prevent terrorism, 
        and enhance resiliency to disasters.
  --Offshore Patrol Cutter (OPC).--Supports continued 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.
  --Polar Ice Breaker (WAGB).--Continues funding for pre-acquisition 
        activities for a new Coast Guard polar icebreaker. This cutter 
        will provide continued heavy icebreaking capability to the 
        Nation for missions in the Arctic and Antarctic following the 
        projected end of service life of the Polar Star on or about 
        2022.
  --Cutter Boats.--Provides continued funding for production of multi-
        mission cutter small boats that will be fielded on the Coast 
        Guard's major cutter fleet beginning with the NSC.
  --In-Service Vessel Sustainment.--Continues to fund sustainment 
        projects on 140-foot ice breaking tugs (WTGB), 225-foot 
        seagoing buoy tenders, and the training barque Eagle (WIX).
  --Survey and Design.--Builds upon previous years to continue multi-
        year engineering and design work for multiple cutter classes in 
        support of future sustainment and acquisition projects.
            Air Assets: $28.0 Million (0 FTE)
    The budget provides $28.0 million for the following air asset 
recapitalization or enhancement initiatives:
  --HH-65.--Continues modernization and sustainment of the Coast 
        Guard's fleet of HH-65 helicopters, converting them to MH-65 
        Short Range Recovery (SRR) helicopters. The modernization 
        effort includes reliability and sustainability improvements, 
        where obsolete components are replaced with modernized 
        subsystems, including an integrated cockpit and sensor suite.
  --C-130H/J.--Funds sustainment of avionics systems on existing C-130H 
        aircraft. The avionics 1 upgrade (A1U) installations on C-130H 
        aircraft enhances the capability of the C-130H fleet by 
        replacing aging/obsolete equipment, and updating avionics to 
        comply with Communications Navigation Surveillance/Air Traffic 
        Management (CNS/ATM) requirements.
            Other (Asset Recapitalization): $59.9 Million (0 FTE)
    The budget provides $59.9 million for asset recapitalization, 
including the following equipment and services:
  --Command, Control, Communications, Computers, Intelligence, 
        Surveillance, and Reconnaissance (C4ISR).--Provides design, 
        development, upgrades and assistance on C4ISR hardware and 
        software of new and in service assets.
  --CG-Logistics Information Management System.--Continues development 
        and deployment to Coast Guard operational assets and support 
        facilities.
  --Nationwide Automatic Identification System (NAIS).--Completes 
        deployment of the permanent transceive system to recapitalize 
        the existing interim NAIS capability in 58 ports and 11 coastal 
        areas.
            Shore Units and Aids to Navigation (ATON): $5.0 Million (0 
                    FTE)
    The budget provides $5.0 million to recapitalize shore 
infrastructure for safe, functional, and modern facilities that support 
Coast Guard assets and personnel:
  --Specific Project.--Completes Phase One of Base Miami Beach 
        waterfront facilities.
  --ATON Infrastructure.--Maintains transportation safety on Federal 
        waterways through construction and improvements to short-range 
        aids and infrastructure to improve the safety of maritime 
        transportation.
            Personnel and Management: $115.8 Million (818 FTE)
    The budget provides $115.8 million to provide pay and benefits for 
the Coast Guard's acquisition workforce.
Strengthen Resource and Operational Stewardship
            Fiscal Year 2014 Major Decreases
    Asset Decommissionings.--In fiscal year 2014 the Coast Guard will 
make targeted operational reductions to prioritize frontline 
operational capacity and invest in critical recapitalization 
initiatives:
  --High Endurance Cutter (WHEC) Decommissionings: -$14.2 Million (-184 
        FTE).--The fiscal year 2014 budget decommissions the fifth and 
        sixth high endurance cutters (WHECs). National security 
        cutters, including the seventh NSC which is fully funded in 
        this budget request, replace the aging HEC fleet.
  --Cutter Shoreside Support Personnel Reduction: -$0.8 Million (-10 
        FTE).--Reduces WHEC Maintenance Augmentation Team (MAT) and 
        Surface Forces Logistics Center (SFLC) billets associated with 
        the decommissioning of two WHECs.
  --HU-25 Aircraft Retirements: -$9.4 Million (-36 FTE).--Retires the 
        eight remaining HU-25 aircraft assigned to Coast Guard Air 
        Station Corpus Christi, Texas; Aviation Logistics Center, 
        Elizabeth City, North Carolina; and, Aviation Training Center, 
        Mobile, Alabama. This will allow for the transition to HC-144A 
        aircraft.
  --HC-130 Aircraft Retirements: -$7.7 Million (-29 FTE).--This 
        initiative eliminates funding and personnel associated with two 
        HC-130H aircraft. The newly acquired HC-130J aircraft will 
        provide increased operational reliability.
  --Close Air Facilities: -$5.1 Million (-28 FTE).--The Coast Guard 
        will close AIRFACs at Charleston, South Carolina, and Newport, 
        Oregon. The search-and-rescue response times within the AIRFAC 
        areas of responsibility will remain within national standards.
    Programmatic Reductions.--The budget proposes targeted reductions 
in several base program areas. These base adjustments recognize changes 
in requirements need for selected activities and prioritizes 
sustainable investment in recapitalization programs:
  --CG Headquarters Staffing: -$6.7 Million (-53 FTE).--Reflects the 
        anticipated reduction in Coast Guard headquarters personnel as 
        a result of the existing hiring freeze and normal workforce 
        attrition.
  --Targeted Intelligence Program: -$1.5 Million (-14 FTE).--Scales 
        intelligence activities across the Service by consolidating 
        analysts at centers, Areas, and Districts; consolidating IT 
        support positions at headquarters; and, eliminating the 24/7 
        call-in maritime watch at the El Paso Intelligence Center 
        (EPIC) that provides services that will remain available 
        through a different watch floor.
  --Port State Control Examinations: -$1.7 Million (-20 FTE).--Reduces 
        port State control personnel by limiting examination activities 
        aboard some foreign flagged vessels assessed as lower risk.
  --Coast Guard Training: -$43.2 Million (-153 FTE).--Leverages Web-
        based distance learning and reduces schoolhouse throughput. 
        Specialty and technical training schools will group into 
        centers of expertise to leverage available resources. 
        Educational benefits will be focused on enlisted personnel who 
        are pursuing an initial undergraduate degree. Reduces 
        accessions and support staffs as well as operational and 
        maintenance funds at the Coast Guard Academy, Leadership 
        Development Center, and Officer Candidate School commensurate 
        with anticipated reduction in out-year accession projections 
        based on reduced workforce levels.
  --Other Targeted Program Reductions: -$1.2 Million (-26 FTE).--The 
        Coast Guard will make targeted reductions to Auxiliary Program 
        Management, the International Port Security Program, and 
        District Drug and Alcohol Program Inspectors (DAPI). Routine 
        DAPI functions will shift to Coast Guard marine inspectors and 
        investigators.
Sustain the Most Critical Frontline Operations
            Pay and Allowances: $43.9 Million (0 FTE)
    The budget provides $43.9 million to fund the civilian pay raise 
and maintain parity of with DOD for military pay, allowances, and 
healthcare. 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, which include pay and personnel benefits for the 
military workforce.
            Operating and Maintenance Funds for New Assets: $64.7 
                    Million (213 FTE)
    The budget provides a total of $64.7 million to fund operations and 
maintenance of shore facilities and cutters, boats, aircraft, and 
associated C4ISR subsystems delivered through acquisition efforts. 
Funding is requested for the following assets and systems:
  --Shore Facilities.--Funding for the operation and maintenance of 
        shore facility projects scheduled for completion prior to 
        fiscal year 2014.
  --Response Boat-Medium.--Funding for operation, maintenance and 
        support of 30 RB-Ms as well as personnel for maintenance 
        support requirements and instructors to support fleet training 
        requirements.
  --Rescue 21 (R21).--Funding for the support of the R21 system as well 
        as maintenance of Coast Guard-leased and -owned towers, Western 
        Rivers communications sites, and encrypted communications for 
        over-the-air-re-key (OTAR).
  --Fast Response Cutter (FRC).--Operating and maintenance funding for 
        FRCs Nos. 10-12 and funding for personnel to operate and 
        maintain hulls Nos. 11-12, homeported in Key West, Florida, as 
        well as the first two San Juan, Puerto Rico hulls.
  --National Security Cutter (NSC).--Operating and maintenance funding 
        for NSC No. 4 to be homeported in Charleston, South Carolina. 
        The initiative also provides personnel to operate NSCs Nos. 4-
        5.
  --HC-144A MPA.--Operating and maintenance and personnel funding to 
        operate and support aircraft Nos. 16-17 that will be assigned 
        to Air Station Corpus Christi, Texas. Also funds maintenance of 
        the first 17 mission system pallets (MSPs)--the sensor package 
        for each operational HC-144A.
  --Manned Covert Surveillance Aircraft (MCSA).--Operating, maintenance 
        and personnel funding to operate and support the first aircraft 
        which is planned to operate out of Miami, Florida, and provide 
        an additional 1,000 hours of maritime surveillance capacity.
  --Air Station Corpus Christi Transition.--Provides funding for the 
        transition from operating HU-25 aircraft to operation of HC-
        144A aircraft.
            Financial Systems Modernization: $29.5 Million (0 FTE)
    Provides funding to support the Financial Management Service 
Improvement Initiative (FMSII) for Coast Guard and Transportation 
Security Administration (TSA). This initiative will plan, prepare, 
configure, test, and migrate the Coast Guard's and TSA's financial 
management system (FMS) including the financial, contract, and asset 
accountability management systems to a shared service provider (SSP).

                            SEXUAL ASSAULTS

    Senator Landrieu. Thank you, Admiral. Let me begin where 
you began, because it is very troubling to many of us in the 
Senate and House who have been following story after story 
about the sexual assaults happening within the Department of 
Defense (DOD). Let me start with a question on this, and then 
we will go to the budget.
    The Coast Guard reported 141 incidents of sexual assaults 
in 2012. The number was up from 83 in 2011 and 75 in 2010. That 
is clear. What is not clear is how many assaults in the Coast 
Guard go unreported, which unfortunately may happen due to the 
fears and consequences of coming forward. Other military 
branches track and file reports and survey their workforce. 
Last week we learned that 26,000 people within DOD said they 
were sexually assaulted, but only 3,374 filed complaints.
    My understanding is the Coast Guard does not survey its 
workforce for anonymous claims. I can understand the pros and 
cons of that but given the really troubling statistics and 
horrifying stories that are coming out, do you plan to track 
the claims the same way, or are you giving some thought to 
opening up opportunities for people to respond anonymously? 
They obviously seem to be afraid to come forward. This could 
help get a fuller picture of what's happening within the Coast 
Guard. While none of this is acceptable, but as you have 
reviewed this, do you think that the Coast Guard is on par with 
other military branches in terms of support personnel, training 
and education programs? Do you have an active victim support 
network? If you would just take 2 or 3 minutes or longer if you 
need to answer, and then we'll go to the budget. We may end up 
having a special hearing on this.
    Admiral Papp. Thank you, Madam Chairman. I appreciate the 
opportunity to speak about it because this is deeply personal 
to me. Things like this were personal to me even before I 
became a coastguardsman. My father placed in my DNA the duty to 
protect people. So you can imagine how frustrating it is to 
know that people within my Coast Guard are being harmed or hurt 
and feel like they have no way to be able to respond.
    The increase in numbers to 141 this year, I'll start by 
saying that one is too many. But anecdotal information leads me 
to conclude that by me talking about it for nearly 2 years now, 
by going out there and talking to my leaders and talking to the 
deck plate as well, people are coming forward and reporting who 
would not have before.
    I have spoken to young people within the service. I've 
spoken to senior people who had experienced sexual assault 
early in their career. They all indicate a more willingness and 
trust to come forward now. I choose to interpret that as a good 
thing, that they are coming forward and reporting, and I think 
that shows an increase in the numbers.
    Plus, we have a strategic plan, and we have put a lot of 
effort with our senior leadership to push training out 
throughout the service. We have now designated 18 collateral 
duty sexual response coordinators throughout the Coast Guard, 
and we have a network of 500 volunteer victim advocates who are 
receiving formal training and are out there.
    I spoke to a young woman yesterday who is a victim advocate 
who is stationed in St. Louis, and she went on and praised the 
program, the training she received and how it has improved her 
ability to talk to people. In fact, in her particular case, she 
is dealing with men-on-men situations in terms of sexual 
assault.
    So once again, we are learning more, because I think we 
have invested more.
    In comparison to the other services, I have spoken to the 
other four service chiefs, and not only the Department of 
Defense but also the individual services have surveys that they 
do. I am interested in this. There are pros and cons to a 
survey, but as far as I am concerned, any measure that you have 
that would indicate trends is going to be useful for us as we 
take on the situation.
    So we are further studying whether we are going to put a 
survey into effect for the Coast Guard. I am inclined to do 
that. We are also looking now at how we might get more full-
time people, if the budget allows, to commit them as full-time 
sexual response coordinators instead of making that a 
collateral duty assignment across the Coast Guard.

                        CAPITAL INVESTMENT PLAN

    Senator Landrieu. I am going to follow up later with some 
questions along this line, and I appreciate your frankness and 
opening your statement with your commitment to address what is 
a very serious and troubling situation.
    But let me shift to a question on the budget. The $1 
billion Capital Investment Plan is, in my view, wholly 
inadequate to replace the old and unreliable assets of the 
Coast Guard. Please be frank and describe the impact this plan 
will have on Coast Guard operations as compared to the $2.5 
billion you indicated that you would like to have. Now, we 
can't have everything we want, but $2.5 billion to maintain the 
fleet, to accomplish or at least try to meet the targets in the 
mission, is far different than $950 million. How is this going 
to impact Coast Guard operations?
    Admiral Papp. Madam Chairman, $500 million, a half a 
billion dollars, is real money for the Coast Guard. So clearly, 
we had $1.5 billion in the 2013 budget. It doesn't get 
everything I would like, but it gave us a good start, and it 
sustained a number of projects that are very important to us. 
When we go down to the $1 billion level this year, it gets my 
highest priorities in there, but we have to either terminate or 
reduce to minimum order quantities for all the other projects 
that we have going.
    If we're going to stay with our program of record, things 
that have been documented that we need for our service, we are 
going to have to just stretch everything out to the right. And 
when we do that, you cannot order in economic order quantities. 
It defers the purchase. Ship builders, aircraft companies, they 
have to figure in their costs, and it inevitably raises the 
cost when you are ordering them in smaller quantities and 
pushing it off to the right, plus it almost creates a death 
spiral for the Coast Guard because we are forced to sustain 
older assets, older ships and older aircraft, which ultimately 
cost us more money. So it eats into our operating funds as 
well, as we try to sustain these older things.
    So we'll do the best we can within the budget, and the 
Secretary and the President have addressed my highest 
priorities. We'll just continue to go on an annual basis seeing 
what we can wedge into the budget to keep the other projects 
going.

                         FAST RESPONSE CUTTERS

    Senator Landrieu. My last question, and then I will turn to 
my colleagues and then come back for a second round. On the 
fast response cutters, we are very proud that they are built in 
Louisiana. I'd like to take credit for that, but it happened 
before I was chairman of the subcommittee, and it was a 
competitive bid that was won, a public bid to build these 
ships. Last year we put six FRCs in the budget. We are going to 
save $30 million because of that rate of building once the line 
is open, to build it efficiently and have the same crew there.
    With this budget, we potentially could lose the $30 million 
in savings, which is very troubling. My question is, will you 
award a contract for the six we funded in 2013, as intended, 
and is it correct that you will achieve $30 million in savings 
by awarding the contract for six boats at a time?
    Admiral Papp. Well, I have a couple of alternatives, Madam 
Chairman. The first option is to award those six in fiscal year 
2013, which was our original intent, and then renegotiate with 
the shipyard to see if we can go to a minimal quantity of two 
for fiscal year 2014. We are at that point now where we can 
renegotiate. The fact of the matter is that renegotiating to 
build only two per year will increase the price. Our estimate 
is probably anywhere between $10 million and $20 million per 
ship more when we go down to only two, plus it pushes out the 
replacement program to 18 years to get all those boats built. 
We will be having to put the first one through a mid-life 
renovation before the last one is constructed. So that is just 
the realities of what we are confronted with.
    The other option is to try to balance out four per year, 
and I understand that is a little unfair to the shipbuilder 
because they gear up, they bring people on board, they invest 
in their infrastructure on the basis of the prediction of six 
per year. As I've said in the past, we think if we build six 
per year, our estimate is we get at least $30 million in cost 
avoidance.
    I wanted to make sure that I was very clear and understood 
that, and I've had my people go back and take a look. I really 
think it is more than $30 million per year, but we start 
getting into competition-sensitive information and things like 
that when we get any more detailed than that. But it is clear 
that when you use the economic order quantity, you will get 
those savings.
    Senator Landrieu. Thank you.
    Senator Cochran.

                        NATIONAL SECURITY CUTTER

    Senator Cochran. Thank you very much for your leadership of 
the Coast Guard and your cooperation with our subcommittee as 
we review the budget request for the next fiscal year.
    Like other shipbuilding accounts, we look ahead at long 
lead time material purchases and other necessary preparation 
for actually submitting requests for construction funding, and 
I was going to ask you about the budget request. As I 
understand it, it does provide for full funding for national 
security cutter No. 7, and it also projects funding for the 
eighth cutter in next year's request.
    Are these current projections, or have they been affected 
in any way with changes in the economic situation or the budget 
uncertainties? What do you see the future over the next few 
years being for the funding request for these construction 
projects?
    Admiral Papp. Senator, I am very confident and optimistic 
on the funding for the national security cutter, and I think 
the national security cutter serves as a perfect example of 
what I've been talking about in terms of a mature project that 
only needs predictable funding and then the time to get it 
done.
    Because it is a mature project, we are not making any 
changes. It is a stable project. All the shipbuilder needs is 
now a constant source of funding. Last year I was here 
explaining why Nos. 7 and 8 were not in the projection. So I 
feel much better being here saying that No. 7 is in the budget 
and that No. 8 is predicted for next year, that is, the full 
funding for No. 8 is in the next year's budget, which takes a 
large chunk out of that predicted $1 billion that we would have 
in acquisition funds.
    The wisdom, I think, of having long lead materials is 
demonstrated, though, this year. We had long lead materials for 
No. 7 in the fiscal year 2012 budget. We were able to take that 
$30 million in cost avoidance, and we actually worked that into 
our computations when we produced the 2014 budget and the level 
that we asked for to do the construction on No. 7. So that is 
validation that long lead materials works, but I will take the 
money for the ship whatever way I can get it, and right now it 
sits with the full funding in next year's budget.

                        OFFSHORE PATROL CUTTERS

    Senator Cochran. As you are looking to the future, I know 
that there has been consideration of an acquisition budget that 
would involve upkeep, modernization, and ongoing national 
security fabrication, which also employs people. I was told 
that 1,200 people in Pascagoula, Mississippi, are employed now 
for fabrication activities.
    What other projections can you let us know about that we 
need to work into the budget if the subcommittee approves this 
for a new class of ships called the offshore patrol cutters? Is 
that still in the plan, to replace the medium endurance cutters 
with the offshore patrol cutters?
    Admiral Papp. Yes, Senator. Absolutely. The first ships 
that will be replaced are 210-foot medium endurance cutters. 
There are 14 of them right now. They are all nearly 50 years of 
age. In fact, the Dauntless, which is one of those ships, just 
had to be put in the shipyard because the hull has wasted 
through and the framing has wasted through, and we are putting 
it up in the shipyard for emergency availability to do steel 
repair on that ship just to keep her functional and safe for 
the crew who has to deploy in it.
    So these ships are well past their time and need to be 
replaced. We are pressing along with the offshore patrol 
cutter, and we are on schedule with that. We are in the process 
now of down-selecting to three competitors for the replacement 
ship. Next year we will down-select that. Actually, in the 
fiscal year 2016 budget, we will down-select to one after we 
have evaluated the three candidates, and then start 
construction in fiscal year 2016 on the lead ship of that 
class.
    The challenge, not necessarily for me but for whoever 
relieves me, will be how do we fit that ship into the 
acquisition budget as we go forward. The original plan was to 
build two of those per year. We are projected to start building 
two per year in 2020. We are going to be hard-pressed to be 
able to fit those in at the current acquisition top-line level 
and do anything else within the Coast Guard. So we may be 
forced to do only one per year, which then increases the unit 
cost on each single ship and, once again, pushes that out for 
probably about 25 years or so. Once again, the lead ship would 
probably be in the position of having to go through a midlife 
before the last ship of the class is produced.
    So it is the same rule of thumb for each and every one of 
these projects. If we are going to maintain the program of 
record, everything is going to get pushed to the right and we 
will just have to build them more slowly and probably at 
increased cost.

                          ACQUISITION PROJECTS

    Senator Cochran. In looking at what the Coast Guard has 
already received for recapitalizing the aging ships and other 
aircraft, boats, and shore facilities, in fiscal year 2013 you 
received $1.4 billion for this account, and the fiscal year 
2014 budget requests only $951 million, of which $616 million, 
we are told, is for the seventh national security cutter. Are 
you on track, do you think, to acquire these additional cutters 
over the term that you project, as well as other long-term 
acquisition priorities of aircraft, as you also plan for?
    Admiral Papp. Senator, my job is to look at the annual 
budget cycle and work our way through that on a year-by-year 
basis. But I am also obligated as the Commandant to look out 
10, 20, 30 years to try and determine what the Coast Guard is 
going to need to conduct its missions. So I am focused on what 
we need, and we have a program of record. The challenge is, 
like any acquisition project, having stable requirements and 
then getting a steady funding stream.
    The national security cutter is there. It is a stable 
project, and now at least we have a predictable funding stream. 
That keeps us at a reasonable price for the ship. As I 
mentioned during my opening comments, in our negotiations for 
hull No. 6, it is coming in basically at the same price as No. 
5 and No. 4 because it is a stable contract. The shipbuilder 
now has a prediction that not only are they going to get No. 6 
but the President put the money in for No. 7, and the 5-year 
plan now predicts that No. 8 will be in there.
    That's the way things should work, a stable project with 
predictable funding. We have a lot of companies right now that 
have put proposals in for the offshore patrol cutter. I don't 
know how many because that is acquisition sensitive, but I am 
led to believe that there is anywhere between eight and a dozen 
companies that are competing for the ship. We are going to pick 
three very good candidates and then down-select to one 2 years 
from now, and all that it will need is a steady funding stream 
to get that project going at a reasonable price for the 
Government.
    I am becoming concerned that we may not be able to fit that 
in within the top line if we continue at these levels for the 
next 5 to 10 years or so.
    Senator Cochran. Well, we thank you for your leadership and 
your service and helping protect our Nation and our citizens. 
Thank you.
    Admiral Papp. Thank you, Senator.
    Senator Landrieu. Senator Moran.

                       FUTURE OF THE COAST GUARD

    Senator Moran. Chairman Landrieu, thank you.
    Admiral, while I indicated in my brief opening comments 
that we are landlocked, we very much appreciate the pay and 
personnel center located in Topeka, Kansas. So we do have a 
Coast Guard presence in our State, and we are very grateful for 
that.
    I just wanted to follow up on your answer to Senator 
Cochran's question. You indicated that you are looking, as the 
Commandant, for a number of years into the future. How do you 
see the Coast Guard different in the 10- or 20-year focus that 
you are now viewing?
    Admiral Papp. Sir, I am a student of history, and I have 
gone back to the beginnings of the service, why it was created. 
Alexander Hamilton, the first Secretary of the Treasury, 
created this maritime, law enforcement, security force. It's 
all because this country depended then and depends now on 
maritime trade for its prosperity. This country will not 
survive long if you don't have safe and secure sea lanes coming 
into safe and secure ports. The Coast Guard provides maritime 
governance. It provides aids to navigation. It provides 
security in the waters. It provides law enforcement. And those 
things will continue into the future. They have been the 
principles and the missions that our service has done for 223 
years, and I anticipate very similar things happening over the 
next 30, 40, and 50 years.
    What will change is the technology, and that is what we are 
in the process of doing right now. My vision has to be what 
technology, what assets do we need to be doing those duties 10, 
20, and 30 years from now. Right now, we are doing them with 
technology that was created in the 1950s. Our high endurance 
cutters and our medium endurance cutters were built during the 
1960s, which means they are using 1950s technology for 
propulsion and for many of the systems that are on board, and 
they are just plain wearing out.
    So the way the Coast Guard will be different is we will 
have better technology, better ships, better aircraft that 
requires fewer people to operate, and expands through sensors 
and communications gear and command-and-control capabilities. 
Broader communication not only within the Coast Guard but 
through the interagency, through the Department of Defense, 
makes us more effective.
    Maritime trade has increased. From the time I was born in 
the early 1950s to now, our population has grown by about--I 
forget how much it has increased, but 40 percent of the 
population lives near the shore or within coastal counties, and 
they are near the water. And all of our ports, 95 percent of 
our trade comes in through the ports.
    So the missions and the things that we do will not change 
much. How we do them, the tools we use to accomplish them, and 
the quality of our people will be the thing that will change.
    Senator Moran. Admiral, thank you for your answer. You also 
reminded me of another Kansas connection to the Coast Guard, 
which is that we export a lot, and those sea lanes are very 
valuable and important to our economy. I just would conclude by 
thanking you for your service.
    Admiral Papp. Thank you, sir, and I did go out for the 25th 
anniversary to Topeka and spoke out there when they had the 
ceremony.
    Senator Moran. I knew you were there, and I appreciate that 
very much.
    Admiral Papp. Yes, sir.
    Senator Landrieu. Senator, thank you for mentioning that. 
You will have to come to New Orleans or to the Mississippi 
coast and see all that grain coming out of Kansas at the mouth 
of the Mississippi River and what the Coast Guard does to get 
those barges in and out of that river, particularly at a high 
time like this. The river is very high, not flooding in our 
part, but it is very, very high, and it is amazing work that 
our pilots do to navigate the barges that come down river.
    Senator Moran. If we can get some rain, we will be glad to 
ship our wheat.

                           POLAR ICEBREAKERS

    Senator Landrieu. Well, I don't know if this subcommittee 
can do anything about that, but we would be happy to 
accommodate you for a visit any time.
    I have three additional questions on polar icebreakers. Our 
Senators from Alaska are not here, and they normally are. They 
both have been very, very supportive of the polar icebreaker, 
and Senator Murkowski, I believe, is, as we speak, at an Arctic 
conference and I think is representing the members of the 
Senate. She has been particularly, along with Senator Begich, a 
very excellent leader.
    It is very concerning to me, and we don't have much ice in 
Louisiana, but we don't need to have ice to realize how 
important the Arctic is for our Nation. I just do not 
understand why this administration's budget seemingly is 
preparing in just the most modest way for the building of a new 
icebreaker. The polar icebreaker Healy was actually built in 
Louisiana. Again, we are happy and proud of the work, to have 
had that work. But other nations, I understand, have several 
icebreakers--Norway, China, Russia.
    Do you know how many icebreakers other nations have already 
operating in this area of the world? Our plan calls for a 
minimum of three. How do you explain this budget, and what are 
your views about how we're going to have the ships that we need 
based on the budget that we have before us?
    Admiral Papp. Well, Madam Chairman, as the service chief, I 
am always looking for--I would love to get whatever I can, and 
I would love to get more tools for my people. But actually this 
is one that--compared to 3 years ago, when I became Commandant, 
we were in dire straits. Before this subcommittee and others, I 
laid out a plan on how I was going to attempt to get us back to 
be able to take care of our minimal requirements in the Arctic. 
I thought they were stretch goals at the time, so perhaps I 
should have set my goals a little bit higher.
    But the first thing was to keep Healy running, our medium 
icebreaker. The second was to get the operating funds for the 
icebreakers back in the Coast Guard's budget so we could 
operate them. And then third was to get Polar Star reactivated 
and have the funding and the operating funds to get Polar Star 
back in service.
    All three of those have been accomplished. Healy is running 
fine. We have the operating funds back in our budget. And Polar 
Star is now reactivated and has been out for operational 
trials. We are going to send Polar Star up to the Arctic to 
start rebuilding the proficiency of our people in icebreaking 
in preparation for sending it down to Antarctica to break up 
McMurdo in February 2014.
    So all three things that I set out have been accomplished. 
I set one stretch goal, and that was to begin the construction 
of a new icebreaker. I didn't think I would get that, but the 
President has put money in the budget to start that process, 
and we are working now on the preliminary requirements document 
going across the interagency and pressing ahead.
    There was a question in other hearings I have been in about 
the minimal amount of money that is in the 2014 budget. That is 
simply because we got the money to begin this so late in the 
2013 budget that we made some reasonable decisions, based upon 
the availability of acquisition funding, to only ask for what 
we needed for 2014 to keep the project going.
    Senator Landrieu. But how much does an icebreaker cost, 
approximately?
    Admiral Papp. My estimate is somewhere between $800 million 
and $1 billion.
    Senator Landrieu. How much is in the whole capital budget 
for this year?
    Admiral Papp. In the entire capital budget?
    Senator Landrieu. In this budget, in the President's budget 
for this year. Is it $900 million, $950 million?
    Admiral Papp. No----
    Senator Landrieu. It's $951 million.
    Admiral Papp. Oh, if you look out across, yes.

                            BORDER SECURITY

    Senator Landrieu. Yes. We are laying the groundwork, which 
is good. I want to tell the members of our subcommittee to 
think about the possibility of building an icebreaker. But in 
order to accommodate that, we would have to use the entire 
capital budget to build the icebreaker, somewhere between $800 
million and $900 million. That would eliminate all other 
capital projects in this budget, and the budget is not even 
including some of the projects, Senator Cochran, just discussed 
with you. The offshore patrol cutter is not in this budget. The 
required number of fast response cutters are not in this 
budget. Aviation assets are not in this budget, and there are 
some housing deficiencies that I'm going to come to in a 
minute.
    But for the record, Admiral, I would like you to just 
submit in writing a complete list of the options that are at 
your disposal to obtain a polar icebreaker, including building 
one from scratch here domestically, using a parent craft design 
perhaps one built by a foreign partner, or leasing. Those are 
the three that come to mind. If there is a fourth option that 
you are aware of, please include it and provide for this 
subcommittee within a couple of weeks the pros and cons of 
each, because our subcommittee is going to be focused on 
actually how to get this done, and I am really unsure at this 
point.
    [The information follows:]

    Answer. The most recent analysis, which included options such as 
building a new icebreaker, leasing of currently available platforms, 
and build-to-lease alternatives, was thoroughly examined in the Polar 
Icebreaker Replacement Business Case Analysis (BCA) which was delivered 
to Congress on 02 November 2011. However, there are currently no U.S.-
built icebreakers available for lease that are capable of operating in 
the Arctic.
    The BCA determined that the most cost-effective path forward was to 
maintain current icebreaking capability, which now includes the 
recently reactivated Polar Star, and to build a new icebreaker. The 
Coast Guard has initiated pre-acquisition activities for the 
construction of a new icebreaker using the funding appropriated in 
fiscal year 2013.

    Senator Landrieu. Let me ask you something about border 
security, because this concerns me and I would really like the 
subcommittee member's thoughts on this. You know, we are 
spending an awful lot of time up here talking about securing 
our land borders between Mexico, California, Arizona, Texas, et 
cetera, and we plan to pass a comprehensive immigration bill 
that spends billions of dollars improving the fencing that our 
subcommittee has supported, the smart fencing using technology, 
unmanned vehicles, drones, et cetera, to secure our border, new 
technology pressing out.
    I want to hear from you today about how you think this 
focus on securing our land borders is going to have on 
potentially pushing some illegal activity into the maritime 
space, which would be very concerning to those of us that have 
a coast, like Senator Cochran and myself, Florida, and Texas. 
Do you have an estimate of what could potentially happen? Are 
there any studies guiding you in how you are thinking about 
deploying your maritime assets over the next few years based on 
what Congress seems about ready to do?
    Admiral Papp. Yes, ma'am. A couple of things to look at 
here. What we are concerned about mostly in terms of border 
issues are illegal migrants and drugs. There are smaller 
things, whether it is weapons, cash, other things. Most of them 
are related, though, to human trafficking and drugs. Those are 
the two major issues.
    Right now I think the Coast Guard and our partners are 
doing pretty good in the maritime in terms of migrants. We 
watch this very carefully. We are particularly concerned in the 
Florida Straits, the Caribbean side going toward Florida, about 
Cubans, Haitians, Dominicans, and in routes through the 
Bahamas. We provide a good deterrent value out there. We 
provide a deterrent value because we have major cutters out 
there that interdict people and do direct repatriations. That 
has a great deterrent value that has shown our numbers 
continuously going down now because of our presence out there.
    I am concerned, though, that through sequestration or the 
limited budgets that we are facing, that it is narrowing down 
the number of ships that we can keep out there on station as 
that deterrent value. If people start thinking they can make 
their way through, migration increases. We are not seeing a lot 
of migration on the Pacific side, the border between California 
and Mexico. What we are seeing is an increase in drugs, 
particularly marijuana being transported through that vector, 
because the border has tightened down.
    So it is clear and there is plenty of evidence that will 
tell us that, as you clamp down on the land border, it is like 
a balloon. You squeeze it, and it will go out around the edges. 
We are seeing increased incursions on the Gulf of Mexico side, 
between Mexico and Texas, and we are seeing an increase in the 
trafficking of drugs. As we have addressed that close to the 
border between Mexico and California, we are finding that they 
are going further out to sea and going further north in 
California, and we will continue to address that as well.
    It is not just a Coast Guard issue. It is a Department of 
Homeland Security issue, and Customs and Border Protection has 
been working with us. We have a task force in San Diego, and we 
are making a good dent in that, I believe. But, once again, as 
you increase the pressure on the border, it will go out to the 
maritime route, which is more challenging because there is a 
lot more area out there. My concern is, once again, we have had 
to cut back on operating hours because of sequestration. There 
are fewer boats, fewer aircraft out there.
    The other place where you want to forward deploy is to the 
eastern Pacific and the deep Caribbean off of Columbia to try 
and cut down the transit zones, the incursions of cocaine, 
which goes up into Central America and then is broken down into 
Mexico, which destabilizes Mexico, feeds the cartels, and then 
makes its way across the border.
    The entire law enforcement organization of the lower 48 
States only comes up with about 40 tons of cocaine each year, 
interdicted at the border or in our cities. We have been 
interdicting over 100 tons in the transit zone before it even 
gets into Central America and into Mexico to be broken down 
into smaller loads to get into our country. Right now, we have 
the lowest number of ships in the transit zone, in the east 
pack and the deep Caribbean, that I have ever seen in my 
career, and most of that is due to a reduction in operating 
funds that we are experiencing right now.

                                HOUSING

    Senator Landrieu. Well, this is very concerning. I have one 
more question, and then I will turn it over to my colleagues.
    The issue of housing has been something that you and your 
wife, Linda, have really focused on for your people, and I 
appreciate that. You obviously have comfortable accommodations. 
I have been there, and thank you for your hospitality. But in 
many places, not just Kodiak, Alaska, where I got a chance to 
visit, but in other places, the Coast Guard bases are very 
remotely situated. I think it is important for us, when we ask 
people to serve, to be able to give them not luxury but 
something very comfortable and safe in some of these areas.
    There is a limited need for new sites in remote locations. 
You just had a study confirming that affordable housing is in 
short supply. The good news is there were 43 sites that were in 
poor condition and there might be places where the Coast Guard 
can be accommodated in local housing. But what are we doing 
about these remote sites, and is there any money in this budget 
to do that?
    Admiral Papp. There is no money in this budget. There is 
maintenance money, so let's look at two things. There is a need 
in certain areas for new construction, like you saw in Kodiak, 
and I have to thank the subcommittee for the $10 million that 
was put in the 2013 budget. It is going to a good cause. We are 
devoting that to the housing shortfall in Kodiak, and as more 
funds become available, we will complete that project. But for 
this year we have maintenance funds that are in there, and we 
will continue our projects where we are upgrading the homes 
that we already own.
    My primary focus has been on our overseas housing. We have 
made that mandatory for my people. But before we made it 
mandatory, we made sure that we were upgrading them to a 
condition that I would be proud to have them stay in. So places 
like Bayamon in San Juan, Puerto Rico, or Air Station Brank in 
Kodiak, these are places where we don't have much choice. There 
is not much in the community, and we are requiring our people 
to live in them, so we have spent maintenance money to upgrade 
them and get them in shape. Kodiak, of course, needs new 
construction, which we can only do with our acquisition money.
    We have a prioritized list of other locations, and as money 
becomes available for new construction in those areas, we will 
do it. Meanwhile, we have identified those that are beyond 
repair and those that are in areas where there is ample housing 
in the community that they can spend their housing money on, 
and we are going to devote our scarce resources to the highest 
priority areas.
    Senator Landrieu. Thank you. If you would submit those 
details to this subcommittee, we would appreciate it.
    [The information follows:]

    Answer. The Coast Guard addresses and prioritizes the projects on 
the shore acquisitions, construction, and improvement (AC&I) backlog 
each year while balancing the shore AC&I requirements with other 
competing fiscal priorities.
    Additionally, the Coast Guard performs an annual review of military 
housing projects and updates housing priorities as part of the 5-year 
Capital Investment Plan. The Coast Guard's intent is to address 
military housing priorities utilizing the Housing Special Funds 
Authority derived from the sale of Coast Guard real property assets.
    The following list of projects shows the Coast Guard's highest 
priority of new construction and repairs of family housing throughout 
the United States.

     PRIORITIZED FAMILY AND UNACCOMPANIED PERSONNEL HOUSING BACKLOG
                         (Dollars in thousands)
------------------------------------------------------------------------
                                                              Estimated
              Location                 Project description     project
                                                                 cost
------------------------------------------------------------------------
Air Station Kodiak, AK.............  Construct Family              9,039
                                      Housing.
Station Jonesport, ME..............  Recapitalize Family           4,000
                                      Housing.
Station South Padre Island, TX.....  Construct Family              6,000
                                      Housing.
Sector Columbia River, OR..........  Construct                    11,000
                                      Unaccompanied
                                      Personnel Housing.
Upper Keys, FL.....................  Construct Upper Keys          3,500
                                      Family Housing Phase
                                      II.
Sector Columbia River, OR..........  Greater Astoria Family        6,000
                                      Housing Phase II.
Air Station Cape Cod, MA...........  Renovate Unaccompanied        8,000
                                      Personnel Housing
                                      Phase II.
Aviation Training Center Mobile, AL  Recapitalize                  7,000
                                      Unaccompanied
                                      Personnel Housing.
Training Center Petaluma, CA.......  Recapitalize Housing..       41,000
Sector Columbia River, OR..........  Construct Housing in         10,000
                                      Greater Astoria,
                                      Phase III.
rrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrr
                                       Prioritized Housing       105,539
                                      Backlog Total.
------------------------------------------------------------------------


    Senator Landrieu. Senator Cochran, any further questions?
    Senator Cochran. I have no further questions, Madam 
Chairman.
    Senator Landrieu. Senator Moran.

                     CONSEQUENCES OF SEQUESTRATION

    Senator Moran. Admiral, this is a question that could be 
asked of any agency head. You mentioned in your testimony about 
fewer boats and fewer hours due to sequestration. I didn't vote 
for sequestration, so this is not in defense of sequestration, 
but how does the number of hours and your number of boats 
compare to 1 year ago, 2 years ago? Every agency head tells us 
about the dire consequences of sequestration. At least the 
allegation is made that sequestration returns us to the levels 
of spending prior to the stimulus spending. I don't know 
whether you received any stimulus money or not at the Coast 
Guard, but I am trying to just get an understanding of what the 
consequence of sequestration is as compared to what it was just 
several years ago.
    So you say fewer boats, fewer hours. Is that less than it 
would have been 2 years ago?
    Admiral Papp. Absolutely. Yes, Sir. We are very fortunate 
that military pay counts are off limits in sequestration. So 
the military workforce of the Coast Guard is there and ready to 
go. A lot of our benefits, things like tuition assistance and 
bonuses and other things that we might like to give out are 
being curtailed, but at least they have their base pay, and we 
are keeping them employed.
    Our civilians, we have 8,000 civilians, but part and parcel 
they are integrated with our military workforce. For instance, 
they sit side-by-side in command centers. We rely upon them for 
acquisition expertise and other staffs throughout the Coast 
Guard.
    So whereas some people took savings because their pay 
accounts were subject to sequester, I could not do that. They 
are part of the team, and we need them on board. We need the 
capacity of our workforce so that when we face things like 
Hurricane Sandy or an oil spill or some other major disaster, 
we have the whole team ready to go. So my first goal was to 
maintain our capacity to be able to respond.
    Then we set priorities on missions. Search and rescue, we 
are never going to cut back there. And certainly the security 
of our ports, we're not going to cut back there. So then that 
sort of limits you down to a small area of things that you have 
to accrue 25 percent of our savings, and what we looked at was 
reducing our other operations by 25 percent.
    Senator Moran. And that is the number of boats and hours, 
when you say other operations?
    Admiral Papp. Number of boats, aircraft, and hours. That is 
sort of an insidious effect because you don't see it 
immediately. You don't see the cocaine that is not being 
interdicted in the transit zone until it shows up on the 
streets and starts becoming less expensive because the supply 
is greater in the States now. That will take time for it to 
work its way through the system.
    Fisheries, we are spending less time on fisheries, more 
incursions by foreign fishing fleets. And once again, it is 
insidious. They know that we maintain our fish stocks, and 
people are out there trying to get to our fish stocks. That is 
going to have a long-term effect.
    Other things like aids to navigation, all these things in 
the short term aren't going to be so apparent, but in the long 
term, as this continues, we start suffering more failures or 
there are more maritime accidents. So you're not going to see 
the immediate effect. All I can do is tell you about what I 
think the long-term effects will be.
    Senator Moran. And let me see if I can summarize, and this 
may not be exactly what you want to say. The sequestration has 
a consequence today, but it's not dramatic, but it's over time, 
over a longer period of time in which the cumulative effect of 
sequestration occurs that has the significance and the change 
in your method of operation?
    Admiral Papp. Sir, that is absolutely right. But once 
again, I am only speaking for the United States Coast Guard and 
how we are dealing with sequestration. So our highest priority 
things, if someone sinks out there, they are going to see no 
change in terms of our performance because we will be out 
there. We maintain that capability and capacity. But it is the 
other things that are perhaps further offshore that the general 
American public doesn't see on a daily basis that is going to 
have the effect.
    Senator Moran. It's one of the reasons I asked the 
question, is because every agency seems to have a different 
consequence in regard to this issue.
    Chair, thank you very much.
    Senator Landrieu. Thank you, Senator.
    We will just submit for the record the testimony of the 
Coast Guard estimating a 50-percent cut to ship hours and 33-
percent cut in air assets due to the sequestration, and the 
cumulative effect over years.
    [The information was provided within the appendix section 
of Admiral Papp's prepared statement on pages 9-12.]
    Senator Landrieu. Thank you, Admiral Papp, for your 
testimony. This is going to be a very challenging year. I am 
committed to doing what I can to make sure that you and the 
Coast Guard have the resources you need to carry out the 
missions we have asked you to do.

                     ADDITIONAL COMMITTEE QUESTIONS

    We will keep the record open for 1 week. Questions should 
be submitted to the subcommittee by close of business Tuesday, 
May 21, and I'm going to submit two additional questions, one 
about the portal for technology and using new technology that 
is on the shelf today and being designed as we speak to 
accomplish some of the missions at a lower cost to the 
taxpayer. We are using basically manpower, woman power, ships 
and detection technologies. There might be unmanned 
opportunities. There could be other technologies that could be 
brought to bear, and I would like to understand a little bit 
more about the portal small businesses and high-tech companies 
have to the Coast Guard. And then, of course, we will get the 
questions answered about the polar icebreaker.
    [The following questions were not asked at the hearing, but 
were submitted to the Department for response subsequent to the 
hearing:]
            Questions Submitted by Senator Mary L. Landrieu
                        capital investment plan
    Question. The 2014 Capital Investment Plan (CIP) indicates that the 
U.S. Coast Guard (USCG) is working with the Department of Homeland 
Security (DHS) to conduct a portfolio review that will aid in achieving 
the Coast Guard's mission needs in a balanced funding manner.
    Please describe what the portfolio review in more detail, including 
the full schedule for the review, and the expected outcomes?
    Answer. DHS will conduct a comprehensive portfolio review in 2013 
that will help develop revised acquisition program baselines (APBs) to 
reflect acquisition priorities and operational requirements achievable 
within the funding projections contained in the 2014 CIP report. The 
review will incorporate performance analyses using a variety of 
approaches (e.g., campaign-level modeling tool, such as that used for 
the recent cost-constrained DHS cutter study) to address the full 
spectrum of USCG assets (surface, air and shore). The performance 
analysis will identify an acquisition portfolio that optimizes mission 
performance within the resource constraints identified.
                           polar icebreakers
    Question. The fiscal year 2014 budget request includes $2 million 
``to continue survey and design activities for a new polar 
icebreaker.'' According to information provided by your staff, 
construction of the new icebreaker will not be completed until 2024 and 
won't be fully ready for operations until 2026 or 2027.
    Please describe why it will take nearly 13 years to have a fully 
operational vessel and how you plan to fill the operational gap after 
the Polar Star reaches the end of its service life.
    Is it a matter of available funding, or are there other challenges 
the Coast Guard faces in building a new icebreaker, including the 
industrial supplier base and requirements from other agencies that wish 
to utilize the vessel, such as the National Science Foundation?
    Provide the committee with a complete list of options at the Coast 
Guard's disposal to obtain a polar icebreaker, including: (1) building 
an icebreaker from scratch; (2) using a parent-craft design, perhaps 
one built by a foreign partner; or (3) leasing. For each option, please 
provide the pros and cons if it were to be pursued as well as cost and 
delivery schedule.
    Answer. The polar icebreaker replacement is still in the pre-
acquisition phases, and as such a detailed acquisition strategy has not 
yet been developed. However, funding provided in fiscal year 2013 
coupled with the $2 million requested in fiscal year 2014 is sufficient 
to enable the Coast Guard to complete the required pre-acquisition 
activities, and the Department anticipates delivering an operational 
ship within a decade after this work is complete coinciding with the 
end of Polar Star's anticipated service life.
                         offshore patrol cutter
    Question. The Coast Guard plans to build 25 offshore patrol cutters 
(OPC) to replace its medium endurance fleet of cutters that are 
technologically obsolete and poorly suited for performing deepwater 
missions. It is estimated that the total acquisition cost of 25 cutters 
will exceed $10 billion. The Coast Guard plans to award design 
contracts for the OPC this year, downselect to one shipyard in fiscal 
year 2016, and have the lead ship commissioned in 2020. Multi-year 
procurement (MYP) authority provides the potential for significant cost 
savings in the acquisition of major vessels by using a single contract 
to buy multiple ships over a number of years. Savings are achieved 
because the shipyard has more certainty in funding, which allows for 
efficiencies in planning, a steady workforce, and lower overhead costs.
    What are the pros and cons of multi-year procurement authority with 
regard to the OPC procurement?
    Answer. In order to qualify for multi-year procurement authority in 
accordance with 10 U.S.C. 2306(b) a program must meet several criteria, 
including the following:
  --Substantial Savings.--The program must estimate that using an MYP 
        contract would result in ``substantial savings'' compared with 
        using annual contracting.
  --Realistic Cost Estimates.--The program's estimates of the cost of 
        the MYP contract and the anticipated savings must be realistic.
  --Stable Need for the Items.--The program must expect that its 
        minimum need for the items will remain substantially unchanged 
        during the contract in terms of production rate, procurement 
        rate, and total quantities.
  --Stable Design for the Items.--The design for the items to be 
        acquired must be stable, and the technical risks associated 
        with the items must not be excessive.
  --Sufficient Prior Deliveries To Determine Whether Estimated Unit 
        Costs Are Realistic.--A sufficient number of the type of item 
        to be acquired under the proposed MYP contract must have been 
        delivered under previous contracts at or within the most 
        current estimates of the program acquisition unit cost or 
        procurement unit cost to determine whether current estimates of 
        such unit costs are realistic.
  --No Nunn-McCurdy Critical Cost Growth Breaches Within the Last 5 
        Years.--The system being proposed for an MYP contract must not 
        have experienced within 5 years of the anticipated award date 
        of the MYP contract a critical cost growth breach as defined 
        under the Nunn-McCurdy Act (10 U.S.C. 2433).
  --Fixed-Price Type Contract.--The proposed MYP contract must be a 
        fixed-price type contract.
    If annual funding were not available the Coast Guard would be 
required to renegotiate, suspend, or terminate the contract. 
Terminating the contract could require the government to pay a 
cancellation penalty to the contractor. Renegotiating or suspending the 
contract could also have a financial impact. Therefore, a principal 
potential disadvantage of using MYP is that it can reduce the 
flexibility for making changes (especially reductions) in procurement 
programs in future years without incurring cancellation penalties.
                          technology transfer
    Question. I have heard from many technology companies and 
entrepreneurs that they apparently have no clear path to bring 
innovative technologies they are developing--or have even developed 
already--to the attention of DHS decisionmakers. I am very concerned 
that creative, cost-effective security and other technologies are being 
missed by DHS procurement officials for the Coast Guard and other 
components.
    Who makes the decision about which technologies the Coast Guard 
tests, researches, and ultimately procures? Is there a ``one-stop 
shop'' in the Science and Technology Directorate or elsewhere in the 
Coast Guard or Department that these individuals can reach out to 
directly?
    I'd also like to understand how the Coast Guard seeks out 
innovative technologies from the private sector with potential mission 
value. Do program staff only await formal responses to contract 
solicitations, or do they also get out of Washington, attend trade 
shows, and conduct proactive outreach to businesses that may have 
already developed technology solutions?
    Can you also comment on current efforts within the Coast Guard to 
evaluate long-duration unmanned and autonomous surface vehicles to 
support research and surveillance capabilities for port security, oil 
spill response, interdiction, and other Coast Guard missions? What 
other technologies are being pursued or considered that help the Coast 
Guard maximize its maritime domain awareness and presence without a 
significant increase in manpower or an expansion of its traditional 
fleet of cutters and aircraft?
    Answer. The public, vendors, OGA, and DHS are encouraged to reach 
out to the Office of RDT&E Program at Coast Guard headquarters or the 
Research and Development Center (RDC) in New London, Connecticut. An 
Internet link to organizational description can be found at http://
www.uscg.mil/acquisition/rdc/rdc.asp. Unsolicited proposals from the 
private sector are required to follow the Federal Acquisition 
Regulations (FAR) (FAR subpart 15.6). The Coast Guard specific process 
for implementation of FAR subpart 15.6 is found at http://www.uscg.mil/
acquisition/business/unsolicited.asp.
    The Coast Guard maintains information on vendor contacts made, as 
part of market research, in the event future requirement/capability 
gaps are identified that could potentially be filled with private 
sector technology solutions.
    There are many ways of engaging the private sector in funded and 
collaborative research to assist the Coast Guard in improving mission 
effectiveness and efficiencies. Funded Coast Guard research projects 
with the private sector are identified and developed using Broad Agency 
Announcements and Federal Register Requests for Information (RFI). 
Collaborative Coast Guard research with the private sector includes the 
use of Cooperative Research and Development Agreements (CRADAs)--a tool 
that Federal labs can use under the Technology Transfer Act. The DHS 
Technology Transfer Program, which is housed in the Science & 
Technology Directorate (S&T), has supported the Coast Guard on several 
CRADAs.
    In 2009, the Coast Guard conducted a preliminary assessment of the 
potential of unmanned and autonomous surface vehicles to improve the 
effectiveness and efficiency of Coast Guard boat operations. This 
assessment indicated that while this technology may have potential, 
there are several challenges to viable implementation into Coast Guard 
capability. These included (a) potential changes to the United States 
and International Rules of the Road regarding the navigation of 
unmanned vessels; (b) the reliability and cost of the technology to 
meet current and anticipated Rules of the Road requirements; and (c) 
Coast Guard boats are multi-mission platforms, performing more than 
just a single operational task such as surveillance, which make a 
business case for such unmanned and autonomous vehicles difficult at 
this time.
    Recently the Coast Guard initiated the planning process, with the 
Office of Naval Research (ONR) and other U.S. Navy organizations, for a 
joint R&D project that will investigate the potential of submerged 
glider technology.
                        national security cutter
    Question. Has the national security cutter (NSC) gone through 
official operational testing, and if not, will operational testing be 
completed in time to inform the purchase of NSCs Nos. 7 and 8?
    Answer. The Coast Guard has engaged the Navy's Commander, 
Operational Test and Evaluation Force (COTF) since 2007 to conduct a 
variety of initial testing. The Initial Operational Test and Evaluation 
(IOT&E) event for the NSC is planned for fiscal year 2014. Prior and 
ongoing testing such as Combat System Ship Qualification Trials 
(CSSQT), aviation certification and information assurance 
certification, as well as operational successes with the first three 
cutters, have continually demonstrated the capabilities and performance 
of the NSC.
                       unmanned aircraft vehicles
    Question. The Capital Investment Plan (CIP) states that unmanned 
aircraft vehicles are still planned to operate from the NSC.
    Please explain your plan for this program given the lack of 
consistent funding in the CIP.
    Answer. Coast Guard Research and Development (R&D) Center 
successfully conducted phase 1 of the ScanEagle (a small ship-based 
UAS) demonstration on CGC Stratton in August 2012. This event focused 
on the engineering, installation, certification and basic operation of 
an sUAS aboard the NSC. The Coast Guard R&D Center is currently 
conducting operationally oriented ScanEagle demonstrations aboard CGC 
Bertholf with a follow-up demonstration planned for winter 2014.
                        maritime patrol aircraft
    Question. The Capital Investment Plan (CIP) appears to include no 
funding for additional maritime patrol aircraft (MPAs).
    What is the effect of this funding decision on the existing 
contract?
    What is the Coast Guard's plan to replace this capability? Provide 
an update on the potential transfer of C-27s from the Air Force and 
what happens if the Coast Guard does not receive them?
    Answer. Fiscal year 2014 is the final option year on the current 
HC-144A MPA production contract. The option for up to two aircraft will 
not be awarded.
    U.S. Coast Guard and U.S. Air Force staffs have been discussing the 
possibility of transferring excess C-27J aircraft from the Air Force to 
the Coast Guard. A formal letter of intent was sent from the Coast 
Guard to the Air Force in March of 2013 explaining that the Coast Guard 
stands ready to immediately accept all excess C-27J aircraft, spares 
and support equipment. The Coast Guard will accept a minimum of 14 C-
27J aircraft.
                        medium endurance cutters
    Question. Given current timeframes for the when the offshore patrol 
cutter (OPC) is expected to become operational, please clarify the 
Coast Guard's plans for medium endurance cutter (MEC) sustainment until 
the OPCs are fully operational. To what extent will current mission 
effectiveness projects (MEPs) on the MECs be sufficient to carry out 
mission requirements until the OPCs are operational?
    Answer. The purpose of the MEP conducted on the 210-foot and 270-
foot MECs was to provide cost-effective upgrades and enhancements to 
selected equipment. The systems and structures targeted during MEP will 
contribute to mission execution and cutter reliability. Although not 
scoped to increase design service life, the MEP may provide 5-7 years 
of additional useful life.
    Those systems and structures that were not addressed during MEP 
will likely require attention in the coming years. The Coast Guard will 
utilize the fiscal year 2013 MEC sustainment funding appropriated in 
fiscal year 2013, to conduct MEC condition assessments in preparation 
for potential future sustainment work.
                                 ______
                                 
              Questions Submitted by Senator Patty Murray
    Question. Admiral Rapp, I would like to address concerns relating 
to a specific project in my State, the Columbia River Crossing (CRC) 
project. As you are well aware, the U.S. Coast Guard (USCG) permitting 
process for this project requires complex interagency coordination to 
complete the multi-year, multi-agency timeline as identified by the 
President's Dashboard Initiative. I want to make sure that the project 
is not delayed as a result of this process, which may jeopardize the 
project's eligibility for State and Federal funding opportunities.
    Please identify how the USCG plans to complete the bridge 
permitting process by the September 30, 2013, deadline?
    Answer. The Coast Guard is making every effort to meet the Federal 
Infrastructure Dashboard permit decision target date of September 30, 
2013. The time taken to achieve an application submission with all the 
necessary components to be considered complete was significant, 
decreasing the Coast Guard's time to evaluate the application, as well 
as adjudicate comments received during the public comment period which 
ends on June 20, 2013. The number and complexity of comments received 
during the public comment period may require the Coast Guard to 
implement an adjustment to the timeline.
    Question. The USCG requested the permit applicant to identify 
avoidance, minimization and mitigation measures for impacts but does 
not specify what standards USCG will use to evaluate those impacts and 
determine whether adequate mitigation has occurred to meet the 
reasonable needs of navigation.
    Please specifically list and describe each standard USCG will use 
to measure the overall impact to navigation and how mitigation measures 
are taken into account in USCG's decision.
    Please also describe how the overall economic benefit of the 
project for the region and Nation will be taken into account in USCG's 
final determination.
    Answer. Per 33 CFR section 114.10, ``The decision as to whether a 
bridge permit or a drawbridge regulation will be issued or promulgated 
must rest primarily upon the effect of the proposed action on 
navigation to assure that the action provides for the reasonable needs 
of navigation after a full consideration of the proposed action on the 
human environment.''
    The Coast Guard Bridge Program Manual (COMDTINST M16590.5) and the 
Bridge Permit Application Guide (COMDTPUB P16591.3C) provide an 
overview of the requirements to determine the reasonable needs of 
navigation. Courts rely on Coast Guard experts to make such a 
determination based on objective, fact-based criteria. Courts will 
defer to agency practice so long as the agency brings the expertise to 
bear in making a decision, Citizens to Pres. Overton Park, Inc. v. 
Volpe, 401 U.S. 402, 417 (1971). For those waterway users that will be 
restricted from transiting through the bridge, incur a loss, and/or 
incur additional costs (direct or indirect) as a result of the proposed 
action the Coast Guard considers them burdened waterway users. In order 
for these waterway users to not be considered burdened, the Coast Guard 
needs confirmation from the burdened parties that their impacts have 
been mitigated. The Coast Guard will then look to the remaining list of 
burdened users to determine whether their needs are reasonable and 
should be accommodated.
    The Coast Guard reviews the overall economic impacts and the 
impacts to waterway users when evaluating the entirety of a permit 
application. However, the Coast Guard's primary consideration is to 
ensure that bridges over navigable waters meet the reasonable needs of 
navigation.
    Question. Admiral Rapp, the Columbia River Crossing Project has 
identified fewer than 10 users that could be impacted by the current 
bridge design. The identified height of 116 feet would affect less than 
0.1 percent of bridge users and less than 0.1 percent of cargo.
    Does the USCG take into account the entirety of river users, or 
only those river users that are negatively impacted by the proposed 
project, when it determines the impact to navigation?
    Answer. When reviewing a permit application the Coast Guard takes 
into account all waterway users.
                       uscg response boat-medium
    Question. Admiral Rapp, the Coast Guard is 10 boats short of 
completing its acquisition of the response boat-medium (RB-M). 
Throughout its procurement history, the RB-M has been delivered on-
time, on-budget, and meets or exceeds all of its performance goals. 
Furthermore, the RB-M offers a number of operational and cost 
advantages over the Coast Guard's fleet of 41-foot utility boats 
(UTBs), which the RB-M is in the process of replacing. I am concerned 
because the USCG's budget request for fiscal year 2014 did not request 
funds for the fulfillment of RB-M procurement.
    Given its record of exceptional performance and cost-effectiveness, 
why has the Coast Guard declined to complete its RB-M procurement?
    Answer. The Coast Guard has completed a mission need analysis and 
only requires 170 RBMs to support Coast Guard operations.
    Question. As you know Admiral, the RB-M was procured to replace the 
USCG's existing fleet of 41-foot utility boats, many of which are 
approaching or have passed four decades of service. If the USCG 
prematurely ends this procurement program, I fear the USCG's capability 
will be diminished. The development and fielding of the RB-M has been 
characterized by the use of technologies such the Coast Guard's Asset 
Logistics Management Information System and an Integrated Electronic 
Technical Publication System to facilitate maintenance planning and 
contractor logistics support.
    How successful have these kinds of support systems been towards 
enhancing the planned maintenance and uptime of deployed RB-Ms?
    How does their performance with the RB-M compare to similar 
applications with other USCG vessels and platforms?
    Answer. Our existing logistics information technology (IT) systems, 
Asset Logistics Management Information System (ALMIS) and Interactive 
Electronic Technical Publication (IETP), have been successful 
maintenance planning tools. They provide the capability to properly 
schedule and execute planned maintenance while tracking overdue 
maintenance requirements. They currently provide visibility of 
inventory parts required for the execution of scheduled and unscheduled 
maintenance. ALMIS' most robust feature is its ability to track asset 
performance and maintenance completion data in near real-time. This 
enables the performance of reliability-centered maintenance analyses 
which allow the Coast Guard to make data driven decisions regarding 
maintenance and operations.
    Not all of the Coast Guard surface assets are supported by ALMIS or 
an equivalent IT tool. The new Coast Guard Logistics Information 
Management System (CG-LIMS) will provide a technology refreshment of 
legacy logistics IT systems, including ALMIS and IETP. It is configured 
to match the Coast Guard's integrated business model and replace a 
number of obsolete and disparate maintenance, supply, configuration 
management, and technical information IT systems for aircraft and 
boats.
                                 ______
                                 
           Questions Submitted by Senator Frank R. Lautenberg
    Question. The Coast Guard needs 58 fast response cutters (FRCs) to 
replace their aging fleet of patrol boats. Congress may fund six boats 
each year--the maximum number allowed to be commissioned under the 
current contract--yet the Coast Guard only requested two boats in the 
fiscal year 2014 budget. If four additional FRCs were funded, two would 
be slated for homeport at Cape May, New Jersey.
    The Coast Guard is currently operating more than 25 percent short 
of its needed patrol boat mission hours. How would a total of six 
additional boats help close this gap?
    What is the financial impact, in the long-term, of commissioning 
two vessels at once instead of the full six allowed under the current 
contract?
    Answer. Fast response cutters are programmed to deliver 2,500 
resource hours each fiscal year. Six FRCs (four more than requested) 
would provide 15,000 resource hours. The 2014 request funds the Coast 
Guard's highest priority needs.
    Question. The Coast Guard Reserve serves a vital role in assisting 
the active Coast Guard on a variety of demanding missions, including 
drug interdiction, search and rescue, and disaster response. After 
Superstorm Sandy, more than 180 reservists, or approximately 20 percent 
of the response force, provided recovery assistance in regions across 
the Northeast that were affected by the storm. The fiscal year 2014 
budget request reduces reservists by more than 1,000 men and women.
    How will this cut impact the ability to provide surge capacity in 
the case of a contingency or natural disaster, like Superstorm Sandy?
    Answer. The Coast Guard Reserve is a national, strategic resource 
that mobilizes reservists nationwide to support contingencies and 
natural disasters such as Superstorm Sandy. Our Reserve workforce will 
remain a vital addition to the Coast Guard's multimission Active Duty 
forces that can be surged in response to future contingencies.
    Question. The Coast Guard is establishing electronic card reader 
requirements for maritime facilities and vessels to be used in 
combination with the Transportation Security Administration's 
Transportation Worker Identification Credential (TWIC) program. A risk-
level assessment of various facilities and vessels will be used to 
establish standards and determine allocation of TWIC resources. Most 
container terminals would likely fall into the lower risk category 
(risk group B), and therefore be subject to a lesser standard. This 
risk determination is based on the known hazardous nature of the cargo 
presented for shipment.
    Does this approach adequately account for risks to our Nation's 
ports that may be concealed in containerized cargo? If not, what steps 
should be taken to ensure that the TWIC program and related risk 
assessments eliminate risks to our ports from both known and concealed 
containerized cargo shipments?
    Answer. The TWIC program, including the use of biometric readers, 
addresses access control into secure areas of Maritime Transportation 
Security Act (MTSA) regulated facilities and vessels. In the TWIC 
Reader Requirements Notice of Proposed Rulemaking, the Coast Guard 
evaluated both the overall risk at various vessels and facilities and 
where the access control benefits of TWIC readers will have the 
greatest impact on that risk. The Coast Guard will continue to monitor 
the costs and security benefits of TWIC readers, as well as the 
external security environment.
    The Coast Guard recognizes the importance of container facilities 
to the Nation's economy, and the need to maintain security at these, 
and other facilities, in order to protect workers, mariners, and others 
who could be impacted by a transportation security incident. TWIC is 
just one of many mechanisms in the multi-layered security regime in 
America's ports that include, but are not limited to: international 
port security; advance notice of arrivals to facilitate screening of 
vessels, crew and cargo; site-specific security assessments; Coast 
Guard-approved vessel and facility security plans; security exercises; 
inspections and spot-checks; and regular patrols. The Coast Guard will 
continue to enforce existing security requirements and conduct other 
security activities at these facilities.
    Question. The Cape May Coast Guard Training Center has significant 
safety and equity improvement needs. Pier 4 is extremely deteriorated 
and presents a major safety hazard. In addition, the barracks at the 
Cape May training facility currently lack sprinkler systems and the 
facilities for male and female recruits are not of equal quality.
    The Coast Guard has received $11 million to address and 
recapitalize portions of the condemned Pier 4, and that project is 
currently in the design phase. Will the proposed project adequately 
address the safety hazards at the pier, and when will it be completed?
    In 2012, the Coast Guard provided a basic plan to make necessary 
improvements to the barracks; however, the plans lacked specific 
details. When will the Coast Guard address the safety conditions and 
inadequate facilities at the barracks?
    Answer. The Cape May Pier project will adequately address the 
concerns with Pier 4. While the project is currently in the design 
phase, there have been no delays, and the contract is anticipated to be 
awarded in September 2013 with 18 to 24 months for contract completion.
    In December 2012, the Coast Guard awarded a contract to address the 
most critical maintenance to the barracks at Training Center Cape May, 
specifically to upgrade the fire detection and suppression system at 
the Healy and James Hall recruit barracks and the Bruckenthal 
unaccompanied personnel housing (UPH) barracks. The contractor has a 
required completion date of January 1, 2014. Munro Hall, the remaining 
recruit barracks building, will have fire detection and suppression 
system upgrades as part of a planned acquisitions, construction, and 
improvement (AC&I) project.
                                 ______
                                 
              Questions Submitted by Senator Thad Cochran
    Question. Admiral, it's my understanding that you have expressed 
interest in obtaining excess Department of Defense aircraft as part of 
a recapitalization strategy. How would this help the U.S. Coast Guard's 
long-term acquisition plan and have you identified the resources that 
would be required to operate and maintain such aircraft?
    Answer. Obtaining excess USAF C-27J aircraft provides cost 
avoidance over the Coast Guard's maritime patrol aircraft (MPA) program 
of record.
    Question. Admiral, these seem like challenging times for the Coast 
Guard for a number of reasons. With the Department of Defense's 
strategic emphasis on the Western Pacific, it's my understanding that 
U.S. Navy ships are being diverted to that region, which means fewer 
assets that the Coast Guard can leverage to conduct its migrant and 
drug interdiction missions. Your recapitalization budget request is 
reduced by 35 percent and you have plans to decommission several aging 
high endurance cutters because of the significant costs to maintain and 
repair them. Can you describe the concerns you may have in being able 
to complete the myriad of missions that the Coast Guard is responsible 
for?
    Answer. Coast Guard operational commanders allocate resources to 
address the highest threats and operational priorities. The Coast Guard 
will continue to do so in this resource-constrained environment. The 
fiscal year 2014 budget submission will provide the Coast Guard with 
funding for the seventh national security cutter and two more fast 
response cutters. These new assets, coupled with robust interagency and 
international coordination will enable the United States and partner 
nations to best mitigate threats throughout the maritime domain.
                                 ______
                                 
             Questions Submitted by Senator Lisa Murkowski
    Question. As the Arctic continues to open, sufficient Coast Guard 
presence in the region is vital to ensuring the safety and security of 
the region. In fact, we recently saw how important the Coast Guard is 
when the mobile offshore drilling unit Kulluk ran aground off 
Sidkalidak Island at the beginning of this year. I am concerned by your 
recent announcement that between budget constraints and Shell Oil's 
recent announcement that it will not be drilling in the Arctic in 2013, 
you won't have an Arctic presence this summer. There are a number of 
reasons we still need a Coast Guard presence exist--last year Rear 
Admiral Thomas Ostebo said that some 1,000 vessel transits are taking 
place in the Bering Strait each summer. What is the Coast Guard plan to 
respond to these needs without an Arctic presence?
    Answer. The Coast Guard will have an Arctic presence this summer. 
Arctic Shield 2013 will focus on understanding traffic on Alaska's west 
coast and the Bering Strait. It includes the Coast Guard's two ice-
breaking vessels, the CGC Polar Star and the CGC Healy, as well as a 
national security cutter. CGC Healy will conduct science missions and 
will partner with the Coast Guard Research and Development Center to 
evaluate equipment, and CGC Polar Star will test the readiness of the 
icebreaker and crew. A national security cutter will be deployed as a 
command and control platform that will conduct various missions. 
Another essential element will be the forward operating location, based 
at the Alaska National Guard hangar in Kotzebue, to support deploying 
our helicopter and personnel. Additionally, a U.S. Coast Guard buoy 
tender and the Canadian Coast Guard will test a State of Alaska 
emergency towing system and a vessel of opportunity (oil) skimming 
system to reinforce crew equipment familiarization and to build upon 
the U.S. Coast Guard's international partnership with Canada. A Spill 
of National Significance (SONS) seminar and a mass rescue workshop are 
also planned.
    Question. I'm happy to see that you requested funding for the 
seventh national security cutter (NSC) as part of the Coast Guard's 
fleet recapitalization program, but I'm concerned that the requested 
$909 million for acquisitions is a dramatic reduction of $600 million 
below the fiscal year 2013 enacted level. Is this the funding level you 
plan for the Coast Guard in the future?
    Answer. The Coast Guard's out-year plans are outlined in the 
Capital Investment Plan to Congress.
    Question. Currently there is one high endurance cutter, the Munro, 
homeported in Alaska. Cutters from California or Hawaii conduct all 
other Alaska Patrol deployments. The Munro is over 40 years old and 
there is no planned replacement. Can the Coast Guard afford to waste 
precious underway days, 20-30 days per patrol, transiting to and from 
the operating area, or does it make more sense to homeport more 
cutters, including a national security cutter, in Alaska?
    Answer. The Coast Guard conducts homeport analysis when considering 
all ports to account for factors including infrastructure costs, access 
to logistics support, quality of life for families, and distance to 
areas of operations.
    Question. Have any studies been conducted to compare the prudent 
cost of facility renovations to homeport and support a national 
security cutter (NSC) in Alaska versus the annual cost of wasted 
transit time for deployments and casualty repair? Will you commit to 
such a review?
    Answer. The Coast Guard conducts homeport analyses when considering 
all ports to account for factors including infrastructure costs, access 
to logistics support, quality of life for families, and distance to 
areas of operations. No Government Accountability Office (GAO) study or 
business case analysis has been conducted to compare the prudent cost 
of facility renovations to homeport and support the NSC in Alaska 
versus the annual cost of transit time for deployments and casualty 
repair.
    Question. Last year we discussed the aggressive pursuit of polar 
shipping routes and control of resources by our Arctic neighbors, and 
the fact that we were so woefully behind on required assets and 
infrastructure. Last year's $8 million for the study and design phase 
for a new polar ice breaker was a good start, but as we move forward 
towards the requests for proposals (RFP), is the $2 million requested 
enough for continued progression in fiscal year 2014?
    Answer. Funding provided in fiscal year 2013 coupled with the $2 
million requested in fiscal year 2014 is sufficient to enable the Coast 
Guard to complete the required pre-acquisition activities, and the 
Department anticipates delivering an operational ship within a decade 
after this work is complete.
    Question. With the Polar Star reactivated, I believe you have 
requested $58 million for polar operations. Will that allow you to meet 
mission requirements in both the Antarctic and Arctic regions?
    Answer. The requested amount of $54 million for polar operations 
($30 million for Polar Star and $24 million for Healy) will enable the 
Coast Guard to meet current mission requirements in both the Antarctic 
and Arctic regions.
    Question. How long do you anticipate it will take to budget for the 
full $850 million required to build a new polar icebreaker that the 
Nation so desperately needs?
    Answer. The polar icebreaker replacement is still in the pre-
acquisition phases, and as such a detailed acquisition strategy has not 
yet been developed. However, funding provided in fiscal year 2013 
coupled with the $2 million requested in fiscal year 2014 is sufficient 
to enable the Coast Guard to complete the required pre-acquisition 
activities, and the Department anticipates delivering an operational 
ship within a decade after this work is complete.
    Question. Is one new polar icebreaker enough?
    Answer. The Coast Guard will be able to meet Federal icebreaker 
requirements in the high latitude regions with CGC Healy and CGC Polar 
Star.
    Question. What are the Department's long-term plans to address our 
critical Arctic needs?
    Answer. The Coast Guard's current suite of cutters, boats, 
aircraft, and shore infrastructure is sufficient to meet mission 
demands in the Arctic. Lessons learned and the experience gained during 
Arctic Shield will be applied to refine and improved Coast Guard Arctic 
operations and presence for the near future and inform the development 
of the Coast Guard's plan to provide strategic long-term presence in 
the region.
    Question. With Rescue 21, Coast Guard units performing search-and-
rescue missions have been more efficient and effective. Rescue 21 means 
less fuel consumption, less crew fatigue, and less wear and tear on 
assets. In addition, more lives are saved. Alaska has more than 33,000 
miles of coastline, over 700 search-and-rescue cases a year, over 300 
lives saved or assisted yearly by the Coast Guard, but I've heard 
reports that Alaska is getting a watered down system using remaining 
acquisition funds. What is your plan for fully implementing this vital 
lifesaving tool in Alaska?
    Answer. Due to the Coast Guard's unique operational requirements in 
the 17th Coast Guard district, the Coast Guard plans to recapitalize 
the existing National Distress and Response System per Alaska's 
geographic requirements, which differ substantially over the 
Continental U.S. coastline.
    The Coast Guard's plan for Alaska is to recapitalize and upgrade 
the existing National Distress and Response System in Alaska. More 
specifically, the Coast Guard is already proceeding to:
  --Upgrade core communications infrastructure at 31 existing sites;
  --Replace Remote Radio Control Console System;
  --Add digital selective calling to all legacy National Distress 
        Sites; and
  --Fill three high-priority coverage gap areas (Middle Cape, 
        Fairweather Banks, Peril Straits); this is in addition to the 
        31 existing sites.
    Additionally, though the Continental United States (CONUS) Rescue 
21 system is deployed to Coast Guard CONUS Sector Command Centers 
(SCCs), in Alaska the recapitalization will extend to 11 command 
centers in six locations as indicated in the following table.

----------------------------------------------------------------------------------------------------------------
   Anchorage       Juneau       Valdez      Kodiak       Sitka      Ketchikan      Command centers       Total
----------------------------------------------------------------------------------------------------------------
1.............  1..........  ...........  ..........  ..........  .............  Sector.............  2
                1..........  1..........  ..........  ..........  1............  Station............  3
                ...........  ...........  1.........  1.........  .............  Air Station........  2
                ...........  1..........  ..........  ..........  .............  SERVS Building.....  1
                ...........  1..........  ..........  ..........  .............  Marine Safety Unit.  1
                ...........  1..........  ..........  ..........  .............  Vessel Traffic       1
                                                                                  Center.
                ...........  ...........  1.........  ..........  .............  Communications       1
                                                                                  Station.
rrrrrrrrrrrrrrr
1.............  2..........  4..........  2.........  1.........  1............    Totals...........  11
----------------------------------------------------------------------------------------------------------------

    Question. I'm told that the most notable difference between the 
Rescue 21 plan for Alaska and the Rescue 21 system being deployed 
across the rest of the United States is in direction finding (DF) 
capability, and that no DF service will be implemented in Alaska. If 
location services are saving lives, how is this plan not short-changing 
the residents of Alaska and the brave men and women of the Coast Guard 
who serve them?
    Answer. The Coast Guard's Continental United States Rescue 21 
direction finding (DF) capability is applicable from the shoreline to 
20 nautical miles offshore. In Alaska, the vast majority of search-and-
rescue cases occur well beyond this 20 nautical mile offshore 
requirement that is necessary for the Continental United States Rescue 
21 coastline coverage.
    Instead, priority is on adding DSC (digital selective calling) 
capability for Alaska. The project is adding DSC functionality and 
completing network infrastructure upgrades. This will allow all 17th 
Coast Guard district command centers to automatically receive GPS 
(Global Positioning System) based data and voice from vessels in 
distress with properly configured DSC radios. The increased position 
accuracy of DSC enables a more efficient response tailored to the 
nature of the distress in Alaska while reducing on scene arrival times 
and crew fatigue.

                         CONCLUSION OF HEARINGS

    Senator Landrieu. Thank you very much. This has been a very 
informative hearing. Meeting recessed.
    Admiral Papp. Thank you, Madam Chairman.
    [Whereupon, at 4:10 p.m., Tuesday, May 14, the hearings 
were concluded, and the subcommittee was recessed, to reconvene 
subject to the call of the Chair.]