Despite a protest by the losing bidders for the Coast Guard’s award in February of preliminary design contracts for the Offshore Patrol Cutter (OPC), the service’s Chief Adm. Bob Papp believes that the Coast Guard’s decision will be upheld and there will be no delay to the program schedule.
“We believe there will be negligible impact at this point” on the procurement schedule for the OPC due to the protests, Papp told the House Transportation & Infrastructure Coast Guard Subcommittee. “I’m confident at this point that our decisions will be sustained and we’ll continue moving out on it.”
The Coast Guard awarded $65 million worth of preliminary and contract design contracts to Bollinger Shipyards, Eastern Shipbuilding Group, and General Dynamics [GD]. The awards were protested in late February by Huntington Ingalls Industries [HII], which is building the Coast Guard’s fleet of high-endurance National Security Cutters, and VT Halter Marine.
The Government Accountability Office (GAO) is expected to rule on the protests by early June. The Coast Guard has issued a stop work order to the three companies awarded the preliminary design contracts pending the GAO’s rulings.
The contracts are for 18 months and are expected to lead to a decision by the Coast Guard in the fourth quarter of FY ’16 to award a single detailed design and construction contract to one shipbuilder for the OPC.
The Coast Guard plans to build 25 OPCs at an estimated cost of $10.5 billion, with the final vessel being delivered in the mid-2030s. Papp said that affordability remains a key driver in the program, which will replace aging 210-foot and 270-foot medium endurance cutters used in long-range ocean patrols.
Papp also said that the $20 million requested to continue design work on the OPC in FY ’15 keeps the program on schedule.
Regarding the Coast Guard’s Fast Response Cutter (FRC) program, which is being built by Bollinger, Papp said that he’s “hopeful” the costs of the two vessels being requested in FY ’15 are not any more expensive than the current FRCs under construction by the shipbuilder. Based on existing FRC work that has been contracted with Bollinger, the shipbuilder can spread its workforce out so that five get built a year and “when we add the two in there [from FY ‘15] they should be able to keep the price per boat about the same,” Papp said. “I’m hopeful at least.”
Bollinger’s 2008 FRC contract called for up to 36 vessels to be built but not all options were fully exercised, leaving the production run at 30 through FY ’14. However, the Coast Guard plans to modify the existing contract to add the FY ’15 option for two more FRCs, which if funded, would allow Bollinger to build 32 of the vessels. Papp said that the Coast Guard is negotiating with Bollinger for the cost of the two FRCs that would be purchased with FY ’15 funds.
The Coast Guard’s requirement is for 58 FRCs and the service is currently writing a Request for Proposals for a new FRC competition to build out the remainder of the planned fleet of short-range patrol boats and to further drive down costs (Defense Daily, March 18).