Legislators want to accelerate Deepwater, but observers are skeptical

Coast Guard allies on Capitol Hill want to speed up the service's $11 billion, 20-year Deepwater acquisition project, but they face an uphill fight in Congress and with the Bush administration, observers said Friday.

Sens. Susan Collins, R-Maine, and Joseph Lieberman, D-Conn., the chairwoman and ranking member of the Senate Governmental Affairs Committee, both support accelerating Deepwater, the service's upgrade of its offshore fleet, so the project could be finished in 10 years. On Thursday, Rep. Frank LoBiondo, R-N.J., chairman of the Coast Guard and Maritime Subcommittee of the House Transportation Committee, said the program should be accelerated and added he would start pressing for more funds immediately.

These legislators have seized on a March 11 Coast Guard report that found accelerating the Deepwater acquisition would tighten homeland security and allow the service to put in more mission time at sea. According to the report, completing Deepwater in 10 years, instead of the planned 20-year timeframe, would put new assets in the field much earlier and improve homeland security.

"Accelerating the Deepwater program would provide nearly 1 million additional Coast Guard mission-hours dedicated to homeland security over the next 20 years," wrote Collins and Lieberman in a March 11 letter to Sen. Don Nickles, R-Okla., Chairman of the Senate Budget Committee. The Coast Guard report was required under the 2002 Homeland Security Act.

But the accelerated timetable carries a steep price tag, at least in the short run. Currently budgeted at $500 million a year for 20 years, Deepwater would receive $1.89 billion in fiscal 2005 under the 10-year plan. It would eat up more than $1.2 billion a year through fiscal 2010. In comparison, the Bush administration's entire fiscal 2004 budget request for the Coast Guard is $5.6 billion.

In all, the acceleration would cost an additional $4 billion over the next five years, but it would save $4 billion over the life of the project, according to the report. Most of the savings would come from replacing ships and other vessels that otherwise would need extensive renovation to stay afloat.

The Coast Guard concluded its Deepwater contractors, Lockheed Martin and Northrop Grumman, could ramp up production to meet a 10-year timetable.

But observers are skeptical that the Coast Guard could win enough funding to move the project ahead more quickly. "The budget climate seems very unfavorable to an acceleration of Deepwater," said Loren Thompson, chief operating officer of the Lexington Institute, an Arlington, Va.-based Defense think tank. "Whatever the mission justification may be, the budget reality is they don't seem to be able to find money to even keep up with the original plan."

And despite the backing of Collins and LoBiondo, congressional appropriators must fund any acceleration of the project. "It's helpful, but support from the appropriators is what counts," said Bruce Stubbs, a former Coast Guard captain who is now an analyst with Anteon Corp., a contractor that provides support to the Coast Guard.

Thompson noted that Deepwater's current funding has already fallen below initial estimates. Coast Guard officials originally said that Deepwater would require $500 million in 1998 dollars to stay on schedule. With inflation, that would amount to $578 million today, but the administration requested $500 million for the project in its fiscal 2004 budget. Coast Guard Commandant Thomas Collins has said he is pleased with this funding level and that the project can adapt to fluctuations in funding.

But Thompson said the project could use more money. "I think the contractors and probably the Coast Guard would be happy if Congress would simply give them enough money to keep them on its original glide path rather than shortchanging it," he said. "But given where we are the notion of getting the money to cut the time in half seems rather improbable."

LoBiondo will press to raise the Deepwater funding level to $578 million in the fiscal 2004 budget, he said Thursday.