In these types of shipbuilding programs, words like “technologically advanced” often go hand-in-hand with design changes, technology changes, and risk. Participation in industry studies is not a pre-requisite for submitting a DD&C proposal. Coast Guard Off Shore Patrol Cutter - Courtesy of Eastern Shipbuilding Group “This is the largest acquisition in the history of the U.S. Coast Guard. Incomplete Cost Estimate. The OPC will provide a capability bridge between the national security cutter, which patrols the open ocean in the most demanding maritime environments, and the fast response cutter, which serves closer to shore. Official Publication of the Navy League of the United States. Coast Guard officials describe the OPC and PSC programs as the service’s highest acquisition priorities. The Coast Guard’s now-under-construction and rapidly emerging Offshore Patrol Cutter (OPC) ship will hit the ocean next year, bringing new strategic and tactical dimensions to homeland defense, multi-service data-sharing and many pressing maritime security Prior to the construction award for OPC 1, the OPC program's schedule has contained significant deficiencies that are contrary to what is called for in best practices for developing schedules that GAO identified. Offshore Patrol Cutter Program Moved Forward Despite Major Risks. Florida-based Eastern Shipbuilding Group has cut the first steel for the US Coast Guard’s (USCG) second offshore patrol cutter (OPC). The Coast Guard is using a deliberative, two-phased design-build strategy to acquire the OPC. The contract was adjusted as part of a request made by the incumbent, Eastern Shipbuilding Group, for extraordinary relief. This could further delay schedules and increase costs. Under this revised plan, the current shipbuilder will build up to four OPCs in the first stage, while the acquisition of the remaining 21 OPCs will be awarded under one or more new contracts starting in fiscal year 2022 in the second stage. Published: Sep 29, 2020. The OPCs will replace the service’s aging medium-endurance cutters, which are becoming increasingly expensive to maintain and operate. Coast Guard Awards Eight Contracts for Industry OPC Studies, Austal USA of Mobile, Alabama: $2 million base award ($3 million total potential value), Bath Iron Works of Bath, Maine: $2 million base award ($3 million total potential value), Bollinger Shipyards Lockport of Lockport, Louisiana: $2 million base award ($3 million potential value), Eastern Shipbuilding Group of Panama City, Florida: $1.1 million base award ($1.2 million potential value), Fincantieri Marinette Marine of Marinette, Wisconsin: $2 million base award ($3 million total potential value), Huntington Ingalls, Inc. of Pascagoula, Mississippi: $2 million base award ($3 million total potential value), Philly Shipyard of Philadelphia: $2 million base award ($3 million total potential value), VT Halter Marine of Pascagoula, Mississippi: $2 million base award ($2.9 million total potential value). These key analyses include varying assumptions to determine how sensitive the estimates are to various factors and quantifying the effects of potential risks. The Coast Guard will use the industry studies results to further inform its follow-on acquisition strategy and promote a competitive environment for the DD&C award. Instructions for accessing the OPC technical library can be found as Notice USCG-OPCSTAGE2-2020 at beta.sam.gov. OPCs have an estimated average procurement cost of about $411 million per ship. The current OPC DD&C contract is for up to four hulls. Seapower Panama City, FL – The keel laying ceremony for the US Coast Guard’s, first of class, Offshore Patrol Cutter (OPC) ARGUS (WMSM-915), was held on April 28, 2020 at Eastern Shipbuilding Group’s Nelson Street facility. The Coast Guard needs a major injection of additional funding to keep pace with global challenges, the service’s commandant said Jan. 13. GAO reviewed Coast Guard program and contract documents, analyzed Coast Guard data, and interviewed Coast Guard and DHS officials. Publicly Released: Dec 16, 2020. The Coast Guard authorized the start of construction for the first two OPCs despite not having a stable design, which is inconsistent with shipbuilding best practices. Publicly Released: Nov 23, 2020. This report examines, among other objectives, how the Coast Guard revised the OPC program after Hurricane Michael and the extent to which the program addressed major risks—particularly in the areas of design maturity, schedule, and cost— before proceeding through key acquisition decisions both pre- and post-hurricane. (Recommendation 6), Recommendation: The DHS Secretary should ensure the DHS Under Secretary for Management directs the Coast Guard, as it develops the next life cycle cost estimate for the OPC program, to update its cost estimate for stage 1 in accordance with best practices for cost estimation, including: (1) conducting a sensitivity analysis, (2) conducting a risk and uncertainty analysis, (3) reflecting information from the program's most recent technical baseline, and (4) conducting an independent cost assessment of the estimate. (Recommendation 3), Agency Affected: Department of Homeland Security: United States Coast Guard, Recommendation: The Commandant of the Coast Guard should ensure the Coast Guard Component Acquisition Executive revises Coast Guard's acquisition policy to include criteria and a methodology for demonstrating design maturity for shipbuilding programs that are aligned with shipbuilding best practices, including specifying the completion of basic and functional designs and maturing critical technologies to a TRL of 7. The Coast Guard plans to acquire 25 OPCs. (Recommendation 2), Recommendation: The Commandant of the Coast Guard should ensure the OPC program demonstrates that the OPC design for stage 1 is stable prior to approval of construction start for OPC 3 by (1) completing ESG's basic and functional designs and (2) maturing the davit technology to a TRL of 7, consistent with shipbuilding best practices. Proceeding towards OPC 3 construction before stabilizing the design—including maturing the design drawings of major ship systems—increases the risk of construction rework if changes are needed. Published: Oct 28, 2020. (Recommendation 7), Recommendation: The Commandant of the Coast Guard should ensure the OPC program improves its risk management processes to follow the format and include content as indicated in DHS acquisition policy and Coast Guard guidance, including (1) holding monthly risk management board meetings and updating its risk register regularly; (2) revising the risk register to include the risks we identified in this report—proceeding into construction with an incomplete 3D model, conducting late operational testing, challenges with ESG's scheduling practices, and challenges with ESG's accounting system; and (3) revising the risk register to comprehensively track risk management information. The Coast Guard opened access to the offshore patrol cutter (OPC) technical library Aug. 3. Suite 200 GAO Says Coast Guard OPC Design Unstable, Schedule Optimistic. Publicly Released: Sep 30, 2020. Hurricane Michael caused extensive damage to the ESG’s shipyard and the Panama City region. The Coast Guard and Eastern Shipbuilding Group commenced cutting steel for the first offshore patrol cutter (OPC), Argus, in Panama City, Florida, Jan. 7, 2019. Aug. 3, 2020 —. The steel cutting for offshore patrol cutter (OPC) Argus (WMSM-915) was a significant milestone for the company even after it sustained damage and work interruption due to Hurricane Michael. Further, the revised post-hurricane delivery dates for the first four OPCs are optimistic and do not fully incorporate schedule risks, increasing the likelihood that the OPCs will not be delivered when promised. Provides the midrange capability in the Coast Guard's layered defense concept, filling the role between the NSC and FRC and replacing the service's two classes of aging medium endurance cutters. The U.S. Coast Guard is restructuring their top procurement priority, the Offshore Patrol Cutter Program. GAO was asked to review the status of the OPC acquisition program. Cutter X: Certainly no indication yet that the Coast Guard is considering an additional type of patrol cutter, but something of 1,500 to 2,500 tons, between the size of the OPC and the FRC would offer a way to procure a larger number of cutters with greater range Publicly Released: Oct 29, 2020. The Coast Guard awarded the company a $110-million contract to design the OPC and build the first hull, with options for eight more ships. Published: Nov 17, 2020. Publicly Released: Oct 20, 2020. The awardees may also identify possible design or systems revisions that would be advantageous to the program if implemented, with strategies to ensure those revisions are properly managed. Published: Dec 16, 2020. Additionally, the OPC has been touted as a next generation ship, and the most technologically advanced vessel the Coast Guard has ever operated. These awards support the Coast Guard’s strategy to mitigate OPC program risk and establish a new, fair and open competitive environment to complete the OPC program of record. The OPC will feature increased range and endurance, more powerful weapons, a larger flight deck, and improved C4ISR equipment, and will accommodate aircraft and boat operations in higher sea states. The first OPC was funded in FY2018. On Oct. 18, 2019, the Coast Guard released a request for information to gauge industry interest in re-competing the remainder of the OPC … The U.S. Coast Guard (USCG) announced the award of Offshore Patrol Cutter (OPC) industry studies contracts to eight shipbuilders on March 20. GAO is making eight recommendations to the Coast Guard and DHS, including ensuring that the program stabilizes its design before proceeding with construction of the next OPC, updates its schedule to address deficiencies and incorporate risks, and updates its cost estimate to improve its credibility. The Coast Guard—a component of the Department of Homeland Security (DHS)—is planning to spend over $12 billion to acquire a fleet of 25 OPCs. Industry studies contracts were awarded to: Under their respective contracts, the awardees will assess OPC design and technical data, provided by the Coast Guard, and the program’s construction approach. Published: Jan 19, 2021. Arlington, VA 22201-5424, Phone: 703.528.1775 Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information. What GAO Found. Coast Guard officials describe the OPC and PSC programs as the service’s highest acquisition priorities. (Recommendation 1), Agency Affected: Department of Homeland Security, Recommendation: The DHS Secretary should ensure the DHS Under Secretary for Management directs the Coast Guard to include in OPC's acquisition program baseline for stage 2 OPC's delivery dates when the stage 2 acquisition program baseline is established and approved at ADE 2B. The request was a result of devastation caused when Hurricane Michael made landfall in Panama City, Florida, on Oct. 10, 2018. Rendering of the Coast Guard's Offshore Patrol Cutter. Published: Oct 20, 2020. This is the component's highest investment priority and will help ensure a variety of missions, such as drug and migrant interdiction, are carried out in offshore waters once its aging Medium Endurance Cutters are decommissioned. The cost estimate used to inform the program's new cost goals did not include key analyses called for in best practices for developing cost estimates GAO identified. for the U.S. Coast Guard’s offshore patrol cutter (OPC) #2. The damage inflicted on the Eastern Shipbuilding facilities by Hurricane Michael in October 2018 resulted in the sea service granting relief to the shipbuilder, reducing its planned construction to four OPCs instead on nine and deciding to recompete the remainder of the OPC … (Graphic: Eastern Shipbuilding Group.) But the cutter's design is unstable, its schedule optimistic, and its cost estimate incomplete—making it likely that building it will take longer and cost more. These awards support the Coast Guard’s strategy to mitigate OPC program risk and complete the program of record by establishing a new, fair and open competitive environment to complete the OPC program of record. Acquisition of the offshore patrol cutter (OPC) is the Coast Guard’s highest investment priority. The awardees will also discuss how they would prepare the OPC functional design for production. Toll free: 800.356.5760 (Recommendation 8), Looking for more? Other nations are beefing up their fleets, he noted, including in the Indo-Pacific region, Adm. Karl Schultz noted during a speech at the Surface Navy Association’s annual symposium, which was held virtually this year due to the COVID-19 pandemic. Fax: 703.528.2333, Hospital Ship Comfort Arrives in New York City, Medical Center Seeks Marine Corps Command’s Help to Manufacture Ventilator Splitter. The Coast Guard exercised contract options to begin construction of the lead OPC and acquire long lead-time materials for the second OPC on September 28, 2018. The Coast Guard will work with ESG to establish new cost and schedule targets under the contract and continue OPC production at ESG’s facilities. WASHINGTON — The U.S. Coast Guard has awarded eight offshore patrol cutter (OPC) industry studies contracts, the service announced in a release. Published: Sep 30, 2020. Unstable Design. The Coast Guard accepted significant risk with the design, schedule, and cost—both before and after the hurricane—to get the cutters built quickly. The OPCs will bridge the capabilities of the national security cutters, which patrol the open ocean, and the fast response cutters, which serve closer to shore. Published: Oct 29, 2020. Recommendation: The DHS Secretary should ensure the DHS Under Secretary for Management directs the Coast Guard to revise OPC's acquisition program baseline for stage 1 to include OPC's delivery dates. Omitting these analyses undermines the credibility of the estimated program costs, increasing the risk that decision makers do not have a complete picture of the full range of costs the program could incur. 2300 Wilson Blvd. Our 8 recommendations could help set the program on a better path. The Heritage-class OPCs are named after cutters that played a significant role in the Coast Guard's history. Construction on the first ship in a new class of US Coast Guard cutters started with a steel cutting ceremony at Eastern Shipbuilding Group’s facilities in Panama City, Florida, on January 7. Overlapping Programs Could Better Collaborate to Share Information and Identify Potential Security Gaps, Most Acquisition Programs Are Meeting Goals but Data Provided to Congress Lacks Context Needed For Effective Oversight, Actions Needed to Improve National Vessel Documentation Center Operations, Information on Federal Agencies' Process for Acquiring Private Land for Barriers, TSA Needs to Establish Metrics and Evaluate Third Party Testing Outcomes for Screening Technologies, DHS Has Opportunities to Improve Its Component Acquisition Oversight, Additional Actions Needed to Strengthen FEMA's Individuals and Households Program, FEMA Individuals and Households Program Applicant Data 2016 – 2018, Select Disaster Profiles for FEMA's Individuals and Households Program 2016-2018, DHS Could Use Available Data to Better Plan Outreach to Facilities Excluded from Anti-Terrorism Standards, Cybersecurity Challenges Facing the Nation – High Risk Issue, Ensuring the Effective Protection of Technologies Critical to U.S. National Security Interests - High Risk Issue, Federal Grants to State and Local Governments, National Flood Insurance Program - High Risk Issue. 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