The Department of Homeland Security is recommending $1.6 billion for the Coast Guard’s procurement account in fiscal year 2022, $625 million less than enacted in the current year due to significant reductions in two programs, the polar security cutter (PSC) and the fast response cutter (FRC).
While the procurement account is taking a hit, at least in the request, DHS is proposing a handsome plus up in the operations and support portion of the Coast Guard’s budget, a key area of focus for Adm. Karl Schultz, the service’s commandant, who wants sustained increases in spending for readiness.
The request for readiness is $9 billion, $535.6 million more than Congress enacted in FY ’21.
Congress typically adds funding to the Coast Guard’s acquisition account, which the service would like to keep at $2 billion or above to maintain its recapitalization goals.
The FY ’22 budget submission also would rescind $65 million in funding previously appropriated by Congress toward a 12th high-endurance Legend-class national security cutter (NSC).
The Coast Guard’s original program of record for the NSC was eight ships to replace 12 aging Hamilton-class cutters, which have been retired. However, Congress has provided construction funding for 11 of the NSCs and wants to hear from the Coast Guard whether a 12th ship is needed amid an expanding mission set for the vessels.
Huntington Ingalls Industries [HII] is building the NSCs.
Although a good chunk of the decrease to the procurement account is offset by an increase for operations and support, overall DHS is seeking to strip the Coast Guard’s discretionary budget but just under $70 million. The discretionary request in FY ’22 is just over $10.9 billion versus nearly $10.98 billion provided in FY ’21.
The PSC program would receive $170 million in the budget proposal, some of which would go for long-lead time and material funding for a third heavy icebreaker, demonstrating the Biden administration’s commitment to the program. Congress in FY ’21 provided funding for the second PSC, which will begin construction during FY ’22, say DHS budget documents released last Friday.
The same budget documents say that the Coast Guard will award the long-lead funding for the third PSC in FY ’22.
VT Halter Marine is under contract for the PSCs and is expected to begin construction on the first ship in the first half of 2021. However, the Government Accountability Office reported earlier this year that the shipbuilder has experienced program delays due to the COVID-19 pandemic and warned that if the design doesn’t mature as planned, the program could suffer delays.
If the program does suffer delays, DHS may have good reason not to seek construction funding for the third PSC in FY ’22 and just wait until next year to request those funds. The PSC program is one of the Coast Guard’s two top acquisition priorities.
The budget request also only seeks $20 million for the FRC program versus $260 million in FY ’21, which buys the last four vessels of the planned buy of 64 patrol boats. Bollinger Shipyards constructs the FRCs.
The budget request keeps the offshore patrol cutter (OPC) program, the Coast Guard’s other top priority, moving forward under its revised schedule. The administration is seeking $597 million for the OPC in FY ’22, funding that will buy the fourth medium-endurance cutter, long-lead time materials for the fifth ship, and maintain detail design efforts for a recompete of the program that begins with OPC 5.
Eastern Shipbuilding Group is building the first four OPCs but the service is recompeting the program for the next 10 or 11 vessels. The service plans to buy 25 OPCs and the budget documents support that goal.