WASHINGTON, D.C. — Today, House Homeland Security Subcommittee on Transportation and Maritime Security Chairman Carlos Gimenez (R-FL) delivered the following opening statement in a hearing to examine the U.S. Coast Guard’s (USCG) shipbuilding and acquisitions process, the state of efforts to modernize the service’s fleet, and ways in which the Department of Homeland Security (DHS) can facilitate faster turnaround times for USCG acquisitions programs.
DETAILS:
Panel I
Shelby Oakley
Director, Contracting and National Security Acquisitions, Government Accountability Office
Ron O’Rourke
Specialist in Naval Affairs, Congressional Research Service
Eric Labs
Senior Analyst, Naval Weapons and Forces, Congressional Budget Office
Panel II
Vice Admiral Paul Thomas
Deputy Commandant for Mission Support, U.S. Coast Guard
Randolph “Tex” Alles
Under Secretary for Management, Department of Homeland Security
See below for a transcript of Chairman Gimenez's opening remarks, as prepared for delivery:
"Today, our subcommittee is discussing the Department of Homeland Security’s role in the Coast Guard’s acquisitions process.
To carry out its eleven statutory missions, the Coast Guard depends on a variety of assets, from small boats and unmanned aerial vehicles to 400 feet long vessels and complex fixed- and rotary-wing aircraft.
These assets must be able to operate in the most austere and challenging environments and carry out dangerous maneuvers to save lives, protect our coastline and our waters, pursue and arrest criminal actors, and enforce U.S. laws. It is therefore critical that the Coast Guard be able to acquire the assets necessary to perform their duties and replace older assets with new, more capable assets as the surface and air fleet age.
The Coast Guard is currently in the process of replacing several mission-critical assets with new cutters. When completed, the new National Security Cutters, Offshore Patrol Cutters, and Fast Response Cutters will replace 90 existing cutters and assume responsibility for seven of the Coast Guard’s eleven statutory missions.
Additionally, the Polar Security Cutters will bolster the aging Coast Guard icebreaker fleet, and three heavy icebreakers will replace the Coast Guard’s sole heavy icebreaker, which is approaching 50 years of service.
The Coast Guard works hand in hand with the domestic industrial base to meet the needs of the service. Among these critical acquisition programs, there are certainly some success stories.
The Coast Guard has so far commissioned 54 out of the 71 planned Fast Response Cutters and expanded the areas of operation for these new cutters to the Persian Gulf and the Indo-Pacific. The shipbuilder is delivering the new FRCs on schedule at a rate of two per year. Additionally, the Coast Guard will soon commission its 10th out of 11 planned National Security Cutters, and the 11th NSC is currently under construction. The NSCs are already fulfilling critical mission requirements in the Indo-Pacific and elsewhere around the world.
However, the Coast Guard has experienced major setbacks with both the Polar Security Cutter and Offshore Patrol Cutter programs. The first Polar Security Cutter was originally supposed to be operational this year, but the Coast Guard has not yet begun construction on the first cutter.
Among the factors contributing to this significant delay has been the lack of experience the Coast Guard and the domestic industrial base have in building icebreaking ships. While several allied countries such as Canada, Finland, and South Korea have extensive experience building icebreakers and ice-capable vessels, no heavy icebreaker has been constructed in the United States in almost 50 years, and the Coast Guard has not commissioned an icebreaker of any kind since 2006. This lack of experience is demonstrated in the development of ship design for the PSC, which to date is still not at the level necessary to begin construction.
The Coast Guard has experienced significant issues with the Offshore Patrol Cutter program as well. Between 2017 and 2019, estimates for the ship’s weight increased by more than 20%. Additionally, a 2023 Government Accountability Office report found that the OPC program – as well as the PSC program – did not follow standard practices in developing the ship’s design and technology.
These issues have caused delays to the construction schedule for the OPCs and raised the overall cost of the program, as well as maintenance costs required to keep the cutters the OPCs will replace online for longer.
I am growing increasingly concerned that the Coast Guard cannot accurately estimate the cost of its shipbuilding programs. We have seen massive cost increases to the PSC program from the initial estimate Coast Guard provided Congress when standing up the program. This is why, last fall, Chairman Green and I requested the Congressional Budget Office to conduct a cost estimate of the PSC program.
According to the preliminary findings presented by Dr. Eric Labs, the PSC program’s cost will be almost 60% higher than the Coast Guard’s current estimate. Furthermore, as I mentioned earlier, existing challenges indicate that the OPC program’s cost will increase substantially from initial estimates.
I understand that the Coast Guard is operating on a significantly smaller budget than its Navy counterparts, despite being tasked by Congress to develop, deploy, and maintain cutters that are equivalent in size and complexity to all but the largest Navy ships.
The Coast Guard’s entire Budget Request for Fiscal Year 2025 was $13.8 billion, with $1.5 billion dedicated for procurement, construction, and improvements. In comparison, the Navy’s Budget Request for Fiscal Year 2025 includes $77 billion for procurement alone, roughly 51 times greater than the Coast Guard’s procurement budget.
That said, as the Coast Guard prioritizes the PSC and OPC programs, which will require the service to administer larger procurement budgets than they are used to, it is imperative that Coast Guard manages these programs effectively and efficiently.
During my time as Chairman of this subcommittee, the message we have received from stakeholders is clear: the demand for Coast Guard services is increasing and will continue to increase in the future.
Bringing these cutters online on time and on budget will determine whether Coast Guard will be able to meet the growing demand for their assets, manpower, and expertise.
Therefore, if we want to stem the flow of narcotics into our country, stop illegal fishing by the Chinese distance water fishing fleet, or maintain a consistent, credible presence in the Arctic to deter our geopolitical adversaries, the Coast Guard acquisitions programs must deliver what Congress tasks the service to do.
I thank our two panels of witnesses for appearing before our subcommittee today to discuss this critical topic, and I look forward to your testimonies."
Watch Subcommittee Chairman Gimenez's opening statement HERE.
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