Thank you all for being here. As chair of the Subcommittee on Oceans, Atmosphere, Fisheries, and Coast Guard, I’m proud to welcome you to our first hearing of the 110th Congress. It’s going to be a busy year for this Subcommittee and I look forward to working with Senator Snowe as we address issues that affect our oceans and coasts. I appreciate our witnesses taking time from their busy schedules, especially with this weather, to testify before us. Thank you, Admiral, for joining us today. I look forward to your testimony and I want you to know that I believe we are allies in getting the Coast Guard the assets you need. Admiral Allen, in our conversations you have always struck me as a man of action, a true problem solver, and a well respected leader. We owe you our gratitude for your service both as Atlantic Area Commander during 9-11 and for your heroic efforts in the aftermath of Hurricane Katrina. I’ve said this to you in a private meeting, but I want it on the record today: No agency does more with less than the United States Coast Guard. You all are the unsung heroes of our homeland security team. We cannot thank you enough for all the work that you do to keep us safe. Mr. Skinner and Mr. Caldwell, welcome to you as well. Thank you for providing Congress with the critical information needed for our oversight role. I look forward to your expert testimony. This country needs a strong Coast Guard for our national security and for our domestic safety. The Coast Guard’s key missions of maritime safety, aiding navigation, protecting natural resources, and ensuring national security are an enormous benefit to this country. It’s the Coast Guard that ensures vessel traffic moves smoothly, our ports are secure, our fisheries laws are enforced, and our shores stay clean. We know this well In Washington state. Puget Sound is one of the busiest and most complex waterways in the world. The Ports of Seattle and Tacoma are the nations third largest port center and move more than 11 thousand cargo containers daily, cruise ship traffic has increased tenfold in eight years from 5 vessels calls in 1999 to more than 200 last year, oil tankers and tank barges made more than 4,000 trips across Puget Sound last year, our ferry system carries more passengers every year than Amtrak, and recreational boats and fishing vessels ply our waterways every single day. All this activity places us at the center of many multi mission challenges facing the Coast Guard, whether they be protecting our nation’s ports, enforcing security on our ferries, conducting search and rescue in heavily used waterways and shorelines, preventing oils spills, international border and drug interdictions, or carrying out mission the missions of Polar icebreaking fleet, which is homeported in Seattle. And it’s the Coast Guard that keeps our fishermen and mariners safe as well. For us in the Pacific Northwest, The Guardian isn’t just Hollywood fiction. Coast Guard Helicopter crews operating out of Port Angeles saved 39 lives in 2006. And that’s just the tip of the iceberg. *** Today we are here to discuss the problems we’ve seen with the Deepwater program and look for ways forward. Before we begin, I want everyone at this hearing to know that all options are on the table as we discuss what we’ve seen with Deepwater and how to move forward. We owe it to the Coast Guard and the American people to get this right, whatever it takes. Four recent independent reports now show us that Deepwater is in deep trouble. The program is not delivering as promised. If someone thought this was a creative experiment – it has failed. And that failure has cost taxpayers hundreds of millions of dollars. This is the fleecing of the taxpayer with ships that don’t float. To date Deepwater has failed to deliver on key assets: - The 123-foot patrol boat conversion has failed, 8 Coast Guard patrol boats are now out of service, and $100 million has been wasted;
- after spending $25 million, the Coast Guard suspended the Fast Response Cutter project because the contractors’ design failed to meet testing requirements;
- the first two National Security Cutters are at least $500 million over-budget and the current design and construction fails to meet the Coast Guard’s performance goals; and
- Deepwater’s Unmanned Aerial Vehicle, “Eagle Eye,” has huge delays, and the prototype crashed.
I’ll be honest with you gentleman. I have trouble swallowing these cost increases in the NSC program. The price tag for the first two cutters has jumped from $517 million to $775 million. And I hear there is the possibility of an additional $302 million in a Request for Equitable Adjustment. On top of that, I still haven’t seen how much more is needed to modify the first two cutters and get them in the water - and we still have six cutters left to build. If the current Deepwater contract isn’t delivering the results, and this Senator thinks it is not, then we must look to change our approach. I’m concerned that this contract gives industry too much authority to grant contracts to itself without open competition. This offers little incentive to control costs, and sidelines the Coast Guard when it comes to oversight. The Department of Defense’s Defense Acquisition University, an organization of experts on defense contracting, released a report on Deepwater on February 5th. The report makes key recommendations for improving Deepwater and also points out the positive steps the Coast Guard has already taken to reform their acquisition process. It specifically recommends that the Coast Guard “define and implement a revised acquisition strategy that does not rely on a single industry entity or contract to produce or support all or the majority of US Coast Guard capabilities.” Today, I hope we can begin to move forward quickly and constructively with a revised strategy, so that the Coast Guard receives the ships, planes, and technology you need at a price that’s fair to taxpayers. I am committed to doing all that is necessary to ensure this program gets back on the right track. The Coast Guard needs to upgrade its aging fleet and air assets in order to carry out its missions for the safety and security of our nation’s coastlines and waterways. I want to put all parties on notice that there will be increased Congressional oversight of this program and we will do what it takes to fix this. There will be hearings and there will be continued investigations. This hearing today is an opportunity for a fair and honest discussion about Deepwater. Both the successes as well as failures are a key part of this discussion and I look forward to all the witnesses’ testimony. I’ve said this earlier, but it bears repeating: No agency does more with less than the United States Coast Guard. We have to be absolutely certain they get the equipment they need and that the equipment works as it should Thank you for joining us. Senator Snowe, your opening statement? ***
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