[Congressional Record Volume 150, Number 43 (Wednesday, March 31, 2004)]
[Senate]
[Pages S3451-S3452]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                    COAST GUARD AUTHORIZATION--2003

  Mr. HOLLINGS. Mr. President, I am pleased that the Senate passed 
S.733, the Coast Guard Authorization bill of 2003, which I cosponsored. 
I am hopeful that the Senate can work quickly with the House and pass a 
final bill in both houses in the near future.
  The Coast Guard has always taken on an impressive array of tasks that 
are important for our security, for the protection of our resources, 
and for the safety of our mariners. After the tragic events of 
September 11, 2001, we have asked the Coast Guard to take on even more 
in the area of maritime security, while asking them to continue to 
carry out their traditional missions as effectively as before.
  This legislation provides authorizations for Coast Guard's Fiscal 
Year 2004 and Fiscal Year 2005 budgets, and also includes important new 
authority for the Coast Guard to better carry out its missions. While 
the President's budget request for these two years provided some 
increases, it was still far from adequate to ensure that the Coast 
Guard will be able to carry out all that we demand of it.
  Thus, I am particularly pleased that I had the support of the 
Committee on Commerce, Science, and Transportation in adding to the 
Fiscal Year 2004 authorization $491 million in authorizations not 
requested by the President. For Fiscal Year 2004, the bill authorizes 
approximately $7.032 billion. This is a 15-percent increase for the 
Coast Guard's budget over what Congress appropriated last year, and 
about 5 percent above the President's request for fiscal year 2004. The 
bill includes authorizations of $246 million in Fiscal Year 2004 for 
port security not requested by the President, including $100 million 
for operating expenses, to cover the increases in operating tempo that 
the Coast Guard has experienced over the past few years, $70 million 
for analyzing port security plans, and $36 million for three additional 
Marine Safety and Security Teams. These additional amounts are 
essential to the security of our ports and waterways, and of our 
maritime transportation industry.
  For Fiscal Year 2005, the bill authorizes approximately $7.787 
billion, a 10-percent increase over Fiscal Year 2004 authorized and 
enacted levels, including for port security operations. This is $327 
million greater than the President proposed, over 4 percent higher than 
the President's request.
  I have also been a firm supporter of the need to provide the Coast 
Guard with the tools it needs to get the job done. The Coast Guard 
needs to upgrade its core assets, in particular, its aging fleet of 
cutters. The Integrated Deepwater Program is the Coast Guard's program 
for achieving these upgrades, and the President has not requested 
sufficient funding in its budgets to even keep this program on its 
original track. I therefore strongly support the inclusion of an 
authorization of $702 million for this program in Fiscal Year 2004, 
which is $202 million above the President's budget request, and $708 
million in Fiscal Year 2005, or $30 million over the President's 
request. These increases will allow the program to get back on its 
original schedule.
  At the same time, I have significant concerns with respect to how 
well the Coast Guard is managing this procurement, and whether the 
unique method for procurement utilized by the Deepwater Program will be 
able to achieve the stated goals of minimizing costs and providing 
operational effectiveness. The Deepwater project is the single largest 
procurement program that the Coast Guard has managed to date. The 
Senate has voiced concerns about this program on numerous occasions 
over the past few years. A GAO analysis of the Deepwater project 
published in May 2001 entitled ``Coast Guard: Progress Being Made on 
Deepwater Project, but Risks Remain'' highlighted risks with the 
project, including concerns with the Coast Guard's ability to control 
costs by ensuring competition among subcontractors, and the Coast 
Guard's ability to effectively manage and oversee the acquisition phase 
of the project. GAO has identified the Deepwater Program as a ``high 
risk'' procurement.
  GAO recently produced a new report on this subject, entitled ``Coast 
Guard's Deepwater Program Needs increased Attention to Management and 
Contractor Oversight.'' The report's major conclusions indicate that 
there is a need for significant improvement of the program and its 
oversight by the Coast Guard. First, GAO found that over a year and a 
half into the Deepwater program, the Coast Guard has

[[Page S3452]]

not put into place the key components needed to provide adequate 
oversight of the prime contractor. For example, the Coast Guard had not 
even agreed on specific criteria to measure the contractor's 
performance, yet awarded the contractor nearly the total amount 
possible as a bonus for the first year of the contract.
  Second, GAO found that there is no clear, transparent and predictable 
opportunity for competition of the subcontracts under the Deepwater 
program. While the prime contractor uses the ``open business model'' to 
decide whether to ``make or buy'' Deepwater assets, this guidance is a 
philosophy--not a formal process with clear criteria and specific 
decision points--that encourages, but does not require competition. In 
fact, over 40 percent of the funds obligated to the first-tier 
subcontractors, Lockheed Martin and Northrop Grumman, have either 
remained with those companies or been awarded to their subsidiaries.
  Perhaps most disturbing, according to Deepwater officials within the 
Coast Guard, it is unrealistic to believe that the Coast Guard would 
change contractors after the first five years of the program. Thus, 
there is little incentive for the prime contractor to achieve the 
performance goal of minimizing total ownership costs. This obviously 
could have serious implications for the American taxpayer.
  I have also long been concerned that the Deepwater Program meets not 
only the letter but the spirit of our Buy America laws. A number of the 
subcontractors that have either received awards under the Deepwater 
Program, and/or are included in the contractor's proposal, make all or 
most of their parts overseas. Buy America was intended to ensure that 
the U.S. Federal government, including the U.S. military, did not 
contribute to the loss of American manufacturing jobs, yet here we have 
a major acquisition program for our 5th branch of the military, the 
U.S. Coast Guard, that appears to be doing just that.
  As a result of concerns about the program, the Commerce Committee 
included in S. 733, as reported, a requirement that the Coast Guard 
provide a report to Congress which would include an analysis of the 
prime contractor's performance in meeting the two key goals of 
providing operational effectiveness and minimizing total ownership 
costs. However, based on this latest GAO report, and the need to ensure 
that Buy America is fully implemented, additional Congressional 
oversight of this major procurement is clearly warranted. Unless there 
are significant changes to the way business is conducted on this 
contract, there will be enormous problems in the future that may, in 
the long run, undermine this program.
  (At the request of Mr. Daschle, the following statement was ordered 
to be printed in the Record.)
 Mr. KERRY. Mr. President, the Coast Guard Authorization Act 
authorizes nearly $15 billion in funding for the Coast Guard to carry 
out its mission for 2 years. This represents a significant increase in 
funding over previous years, and will go far to support an agency that 
has both civilian and homeland security responsibilities. The bill also 
includes funding for the Deepwater program, funding for port security 
measures, provisions aimed at preventing oil spills and helping 
fishermen, and protections for marine resources.
  Let me begin by discussing the authorization included in the bill. 
The fiscal year 2005 budget authorization is 4 percent higher than what 
the President has requested. This difference represents $327 million, 
and the authorization itself is a $700 million increase over what the 
Congress appropriated for the current fiscal year. The funding 
increases in the bill will help the Coast Guard meet all of its 
missions. The Coast Guard has stretched its resources dramatically 
since September 11, and traditional missions such as enforcement of 
fishing and marine resource laws as well as search and rescue missions 
are still below pre-September 11 levels.
  This legislation includes over $700 million for both fiscal year 2004 
and fiscal year 2005 for the Coast Guard's Deepwater program, well over 
the $500 million in fiscal year 2004 and the $678 million in fiscal 
year 2005 requested by the President. Deepwater is an important program 
that will allow the Coast Guard to purchase new ships, planes, and 
navigation equipment and integrate those resources into its existing 
infrastructure.
  This legislation also addresses security at our ports. Unfortunately, 
many of our Nation's ports and waterways remain vulnerable to terrorist 
attacks. Implementation of the Maritime Transportation Security Act is 
expected to take years. Therefore, it is important that the Coast 
Guard, the main Federal agency charged with port security, have 
adequate resources to meet current homeland security responsibilities. 
The bill includes $70 million to assess port security plans as well as 
$100 million for expenses that the Coast Guard incurs when the 
Government issues homeland security alerts. The bill also authorizes 
$36 million for three new maritime safety and security teams, MSSTs. 
The MSSTs have already become a vital security force for many of the 
Nation's busiest ports. Major port cities such as New York, Boston, and 
Los Angeles have benefitted from the deployment of MSSTs, and I am 
pleased that this legislation will allow other ports to receive the 
same level of protection. The bill also includes $40 million for the 
automatic identification system, AIS. Mandated by the Maritime 
Transportation Security Act, the AIS will allow the Coast Guard to 
track and monitor certain vessels that could pose a threat to port 
security. It is essential that this system operates at full capacity. 
The fiscal year 2005 authorizations include an overall 10-percent 
increase for operating expenses and general capital costs to ensure 
that port security priorities continue to be funded at appropriate 
levels.
  I am pleased that the bill includes a number of environmental 
provisions, aid for fishermen affected by oilspills, and protections 
for living marine resources. In response to last year's oilspill in 
Buzzards Bay, MA, we included in this bill a provision that requires 
the Coast Guard to study the feasibility of speeding up the deadline 
for companies to start using double-hull tankers to transport oil. Also 
in the bill is a mandate for the Coast Guard to issue a report 
outlining the cost and benefits of requiring vessels to have electronic 
navigational equipment on board. In addition, to ameliorate the effects 
of oilspills on fishermen, we added language to the bill that will 
allow fishermen to receive loans from the oilspill liability trust 
funding during the period immediately following an oilspill.

  The bill also addresses the issue of ship strikes of one of the most 
endangered whales in the world--the North Atlantic right whale. There 
are only about 300 individuals left in this entire species, and ship 
strikes are the No. 1 cause of mortality. While lobstermen and other 
fishermen in the Northeast have shouldered significant regulatory 
requirements to avoid entanglement of these whales in fishing gear, no 
actions have been taken to address the risks from ship strikes. The 
bill would require the Coast Guard to undertake studies to examine 
options for minimizing vessel strikes of North Atlantic right whales in 
accessing ports where this is an issue. In addition to these studies, 
the bill would require the Coast Guard to submit a report to Congress 
on the effectiveness and costs of such measures.
  In conclusion, we have crafted a balanced bill that will benefit the 
Coast Guard and enhance our domestic security. The Congress has a 
responsibility to oversee the Coast guard and provide it with direction 
and resources. With this bill, we have met that responsibility. I urge 
my colleagues to support it. Mr. President, I would like to acknowledge 
the hard work of Senator McCain, Senator Hollings, and Senator Snowe in 
helping to draft this legislation. I respect and appreciate their 
dedication to these issues. Thank you.

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