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Navy Littoral Combat Ship (LCS)/Frigate Program: Background and Issues for Congress

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Navy Littoral Combat Ship (LCS)/Frigate Program: Background and Issues for Congress Ronald O'Rourke Specialist in Naval Affairs June 12, 2015 Congressional Research Service 7-5700 www.crs.gov RL33741 Navy Littoral Combat Ship (LCS)/Frigate Program: Background and Issues for Congress Summary The Navy’s Littoral Combat Ship (LCS)/Frigate program is a program to procure 52 LCSs and frigates. The first LCS was funded in FY2005, and a total of 23 have been funded through FY2015. The Navy’s proposed FY2016 budget requests the procurement of three more LCSs. The Navy estimates the combined procurement cost of these three ships at $1,437.0 million, or an average of $479.0 million each. The three ships have received a total of $80 million in prior-year advance procurement (AP) funding, and the Navy’s FY2016 budget requests the remaining $1,357.0 million that is needed to complete their combined procurement cost. From 2001 to 2014, the program was known simply as the Littoral Combat Ship (LCS) program, and all 52 planned ships were referred to as LCSs. In 2014, at the direction of Secretary of Defense Chuck Hagel, the program was restructured. As a result of the restructuring, the Navy now wants to build the final 20 ships in the program (ships 33 through 52) to a revised version of the baseline LCS design. The Navy intends to refer to these 20 ships, which the Navy wants to procure in FY2019 and subsequent fiscal years, as frigates rather than LCSs. The Navy has indicated that it may also want to build ships 25 through 32 with at least some of the design changes now intended for the final 20 ships. The Navy wants to procure ships 25 through 32 in FY2016-FY2018. Two very different baseline LCS designs are being built. One was developed by an industry team led by Lockheed; the other was developed by an industry team that was led by General Dynamics. The Lockheed design is built at the Marinette Marine shipyard at Marinette, WI; the General Dynamics design is built at the Austal USA shipyard at Mobile, AL. Ships 5 through 24 in the program are being procured under a pair of 10-ship block buy contracts that were awarded to the two LCS builders in December 2010. The 24th LCS—the first of the three LCSs expected to be requested for procurement in FY2016—is the final ship to be procured under these block buy contracts. The LCS program has been controversial due to past cost growth, design and construction issues with the lead ships built to each design, concerns over the ships’ survivability (i.e., ability to withstand battle damage), concerns over whether the ships are sufficiently armed and would be able to perform their stated missions effectively, and concerns over the development and testing of the ships’ modular mission packages. The Navy’s execution of the program has been a matter of congressional oversight attention for several years. The program’s restructuring in 2014 raises additional oversight issues for Congress. Congressional Research Service Navy Littoral Combat Ship (LCS)/Frigate Program: Background and Issues for Congress Contents Introduction ...................................................................................................................................... 1 Background ...................................................................................................................................... 1 Program in General .................................................................................................................... 1 Ships .................................................................................................................................... 1 Mission Packages ................................................................................................................ 5 Manning and Deployment ................................................................................................... 6 Procurement Cost ................................................................................................................ 7 Controversy and Proposals to Truncate Program ................................................................ 9 Program’s 2014 Restructuring ................................................................................................. 10 February 2014 DOD Announcement of Restructuring Effort ........................................... 10 Navy Work to Identify Ships to Follow First 32 LCSs ..................................................... 11 December 2010 DOD And Navy Announcement of Restructured Plan ............................ 12 FY2016 Funding Request ........................................................................................................ 19 Issues for Congress ........................................................................................................................ 20 Analytical Foundation for Revised Design for Ships 33-52 .................................................... 20 Overview ........................................................................................................................... 20 Three Analyses That Can Strengthen an Analytical Foundation ....................................... 20 Original LCS Program Lacked One of These Analyses Prior to Announcement of Program .......................................................................................................................... 21 Navy’s Restructured Plan for Final 20 Ships Appears to Have Been Announced Without Two of These Analyses ..................................................................................... 22 Survivability of Revised Design for Ships 33-52 .................................................................... 25 Acquisition Strategy for Ships 25-32 ...................................................................................... 26 Technical Risk and Issues Relating to Program Execution ..................................................... 27 Sea Frame .......................................................................................................................... 27 Mission Packages .............................................................................................................. 32 Additional Oversight Issues Raised in GAO Reports.............................................................. 36 Legislative Activity for FY2016 .................................................................................................... 36 FY2016 Funding Request ........................................................................................................ 36 FY2016 National Defense Authorization Act (H.R. 1735/S. 1376) ........................................ 37 House ................................................................................................................................. 37 Senate ................................................................................................................................ 39 FY2016 DOD Appropriations Act (H.R. 2685/S. 1558) ......................................................... 44 House ................................................................................................................................. 44 Senate ................................................................................................................................ 44 Figures Figure 1. Lockheed Baseline LCS Design (Top) and General Dynamics Baseline LCS Design (Bottom) ........................................................................................................................... 4 Congressional Research Service Navy Littoral Combat Ship (LCS)/Frigate Program: Background and Issues for Congress Tables Table 1. Past (FY2005-FY2015) and Projected (FY2016-FY2020) Annual LCS Sea Frame Procurement Quantities ..................................................................................................... 3 Appendixes Appendix A. Some Major Program Developments Prior to Program’s 2014 Restructuring ......... 45 Appendix B. Defense-Acquisition Policy Lessons of LCS Program............................................. 49 Contacts Author Contact Information........................................................................................................... 50 Congressional Research Service Navy Littoral Combat Ship (LCS)/Frigate Program: Background and Issues for Congress Introduction This report provides background information and issues for Congress on the Navy’s Littoral Combat Ship (LCS)/Frigate program, a program to procure 52 LCSs and frigates. The first ship in the program was procured in FY2005, and a total of 23 have been procured through FY2015. The Navy’s proposed FY2016 budget requests the procurement of three more LCSs. The Navy estimates the combined procurement cost of these three ships at $1,437.0 million, or an average of $479.0 million each. The three ships have received a total of $80 million in prior-year advance procurement (AP) funding, and the Navy’s FY2016 budget requests the remaining $1,357.0 million that is needed to complete their combined procurement cost. The Navy’s execution of the program has been a matter of congressional oversight attention for several years. In 2014, at the direction of Secretary of Defense Chuck Hagel, the program was restructured. The program’s restructuring in 2014 raises additional oversight issues for Congress. Congress’s decisions on the LCS/Frigate program will affect Navy capabilities and funding requirements, and the shipbuilding industrial
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