Coast Guard hopes third time is the charm for troubled Deepwater program

Program has affordability challenge, GAO says

The Coast Guard has nearly finished the third fleet mix analysis of its $27 billion Integrated Deepwater System asset acquisition project, at a time when the program continues to have problems with affordability and management, according to a new report from the Government Accountability Office.

The Coast Guard's first determination of the mix of cutters, patrol boats and other assets to be purchased under Deepwater was done in 2001 before the Sept. 11 terrorist attacks. The fleet mix was reconfigured in 2006 to reflect post-9/11 priorities, but now it is being re-examined again because of the Coast Guard’s new role as lead systems integrator on the project since April 2007, states the GAO report published Feb. 25.

The Coast Guard now recognizes that its knowledge of the 2006 fleet mix analysis is limited, GAO wrote. That is because the contractor — a joint venture between Lockheed Martin Corp. and Northrop Grumman Corp. — “in certain cases had developed the plans for these assets without using all the input from the Coast Guard,” the GAO report said.

As a result, the service decided to conduct another fleet mix analysis.

Although the new analysis was to be finished in the summer of 2009, it isn't completed and will not be ready for several more months, the report said. GAO also said it is too soon to know how much the new fleet mix analysis will affect the project.

Meanwhile, the Coast Guard continues to face management and cost problems with Deepwater.

“Our work on the Deepwater acquisition program identified problems in costs, management and oversight that have led to delivery delays and other operational challenges for certain assets and missions, but it also recognized several steps the Coast Guard has taken to improve Deepwater management,” the report said.

The Coast Guard’s budget request for fiscal year 2011, at $9.87 billion, represents no increase from the enacted fiscal 2010 budget.

“One of the key themes of the fiscal year 2011 budget is the trade off between current operational capacity and continued investment in future capability,” the GAO report said. In fiscal 2011, the Coast Guard is prioritizing capital investment over current operations and “expects that these changes in capacity will reduce the overall level of service it provides the nation and that performance will be diminished in a variety of areas.”

The Deepwater program at $1.11 billion accounts for about 80 percent of the $1.38 billion in capital spending proposed for fiscal 2011. By taking such a large share of available funding Deepwater creates an affordability concern, GAO said.

“Continuing into future budgets, Deepwater affordability is likely to continue to be a major challenge for the Coast Guard given other demands on the agency for both capital and operations spending,” the report concluded.

About the Author

Alice Lipowicz is a staff writer covering government 2.0, homeland security and other IT policies for Federal Computer Week.

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Reader comments

Fri, Jul 30, 2010

The failure of Deepwater falls squarely on the shoulders of CG leadership, which has more flag officers per capital than other services 5 times its size. The Coast Guard has failed to seize an upon opportunity to expand its budget commensurate with it mission portfolio in the post-911 DHS era. Shame on the Coast Guard for allowing the curse of SEMPER PARATUS to persist.

Tue, May 25, 2010

the coast guard needs good honest objective management and it doesn't appear it's getting that from the contractor community. the contractors involved will provide every excuse to rationalize their shortcomings. time to break up all these oligopolies supporting the federal government, and only work with the competent ones.

Thu, Apr 15, 2010

My personal opinion is that the coast guard needs to be taken more seriously. All of our missions and the lack of members. We do so much with so little. If we had the proper funding this wouldnt be an issue. Let's see other services run a cutter with such a low number of members or even run a cutter that is close to 60 years of age. When you work in these enviorments or with this type of equipment then you can have a say. Other wise just continue doing what you do and we will handle the rest. -Coastie-

Wed, Mar 3, 2010

Well, I can remember back when the project "Deepwater" stood up. A LOT of "POMP". In the acquisition shop were I was located...it was "The Deep KIMSHY" Project from the start. It's just living up to the expectations from those who tried to convey this result to the senior CG folks back then. Tsk, tsk, tsk...more waste!

Tue, Mar 2, 2010 Dan MD

The title is great, if anything, let's deep six the Deepwater name. Deepship is more like it! Let's let the Coast Guard run their own show, get the contractors and DHS HQ out of the way.

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