Coast Guard Modernization Faces Delays and Cost Overruns, Accountability Office Reports

The U.S. Coast Guard’s highest priority modernization programs face significant delays and cost overruns due to immature technologies and unstable designs, according to the Government Accountability Office.

The Offshore Patrol Cutter (OPC) and Polar Security Cutter (PSC) programs are both behind schedule and over budget, posing a risk of capability gaps and financial strain for the service.

The Coast Guard is currently investing billions of dollars into the initiatives, which are deemed its highest priority programs. However, the GAO testified that these programs are facing challenges because critical information regarding technology, design, and cost was not available at key decision points in the shipbuilding process.

An example cited by the GAO is the Coast Guard’s plan to acquire 25 new ships for offshore missions. However, before constructing the first ship, crucial portions of its design, like the heating and cooling systems affecting multiple zones, were not completed. This oversight poses a risk of having to rebuild portions of the ship, leading to further delays.

To help fill the capability gap, the Coast Guard has invested at least $850 million to maintain aging cutters and is investing $250 million to extend the service life for six cutters and $75 million to extend the service life of the almost 50-year-old icebreaker USCGC Polar Star until the delayed vessels become operational.

According to GAO’s prior work, successful shipbuilding programs are characterized by well-executed business cases, mature technologies, stable designs, and realistic cost estimates before significant investments are made. Unfortunately, the Coast Guard has struggled to attain the necessary knowledge at the appropriate stages, leading to cost growth and schedule delays in some of its acquisitions, the GAO said.

GAO highlights two primary issues plaguing the modernization programs: the lack of maturity in critical technologies, like the davit for the first four OPCs, and the instability in the design of the PSC, resulting in a 3-year schedule delay for the first cutter’s construction, with the start of construction of the first cutter now planned for March 2024.

These delays and cost overruns have resulted in both programs exceeding their initial cost estimates by billions of dollars and falling more than 2 years behind schedule.

The GAO has made seven recommendations in its latest report to mitigate these concerns to better align the programs with shipbuilding practices. The Coast Guard and Department of Homeland Security agreed with five recommendations. However, overall, the GAO has made 40 recommendations over the past decade, of which 14 remain open.

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