Coast Guard's Deepwater faces possible cost hikes and delays. Adm. Allen says new estimates are expected in the next six to 12 months...

By Austin Wright
VIRGINIA BEACH, Va. -- Adm. Thad W. Allen, the commandant of the Coast Guard, said Tuesday that the service’s $24.2 billion Deepwater acquisition program could end up being more expensive and take longer to deploy than had been previously estimated. A July Government Accountability Office report said costs could increase by as much as $2.7 billion for the program, which aims to overhaul the Coast Guard’s aging fleet by 2027.
Two-and-a-half years ago, Coast Guard officials scrapped Deepwater’s lead contractor, a Lockheed Martin-Northrop Grumman consortium, and began the process of transferring the management of the program to its own acquisition shop. GAO said a higher price tag for Deepwater is likely because the contractor team may have underestimated the cost. By bringing the program in-house, the Coast Guard probably will be able to come up with a more realistic -- and maybe higher -- cost estimate, GAO said. Revised cost and timeline figures will be released in the next six to 12 months, Allen told National Defense.
“There used to be a rollup estimate for the entire system and that included all the cutters, aircraft and sensors that we were buying,” he said. “We’re now taking each component … apart, and we’re doing an acquisition baseline of each. “That’s going to provide a check to us of whether we’ve got the right estimates and where cost is going,” he added. “It’s liable to change. But we’re going to break this procurement apart and openly compete each one of the assets, so we should get best value.”
The Coast Guard has now rolled what used to be 15 Deepwater programs into one acquisition directorate, which also oversees seven other major programs. Deepwater’s flagship project, replacing the fleet’s national security cutters, reached a milestone earlier this month. The service accepted the second of eight new ships, a 418-foot cutter named the Waesche.
“The third cutter, the Stratton, will be launched here very shortly,” Allen said. “We’re dealing with a very complex world with transnational threats, and the demand for our services has never been greater.”

Topics: Homeland Security, Deepwater

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