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Polar Icebreaker) Program: Background and Issues for Congress

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Polar Icebreaker) Program: Background and Issues for Congress Coast Guard Polar Security Cutter (Polar Icebreaker) Program: Background and Issues for Congress Ronald O'Rourke Specialist in Naval Affairs Updated March 1, 2019 Congressional Research Service 7-.... www.crs.gov RL34391 Coast Guard Polar Security Cutter (Polar Icebreaker) Program Summary The Coast Guard Polar Security Cutter (PSC) program, previously known as the polar icebreaker (PIB) program, is a program to acquire three new heavy polar icebreakers, to be followed years from now by the acquisition of up to three new medium polar icebreakers. The Coast Guard wants to begin construction of the first new heavy polar icebreaker in FY2019 and have it enter service in 2023. The acquisition cost of a new heavy polar icebreaker had earlier been estimated informally at roughly $1 billion, but the Coast Guard and Navy now believe that three heavy polar icebreakers could be acquired for a total cost of about $2.1 billion, or an average of about $700 million per ship. The first ship will cost more than the other two because it will incorporate design costs for the class and be at the start of the production learning curve for the class. The PSC program received about $359.6 million in procurement funding through FY2018, including $300 million provided through the Navy’s shipbuilding account (which is part of the Department of Defense’s budget) and $59.6 million provided through the Coast Guard’s procurement account (which is part of the Department of Homeland Security’s [DHS’s] budget). The FY2019 DHS Appropriations Act (Division A of H.J.Res. 31/P.L. 116-6 of February 15, 2019) provides an additional $675 million for the PSC program through the Coast Guard’s procurement account, including $20 million for the procurement of long leadtime materials (LLTM) for the second ship in the program. The PSC program has thus received a total of $1,034.6 million (i.e., about $1.0 billion) in procurement funding through FY2019. Excluding the $20 million provided for the procurement of LLTM for the second ship in the program, the remaining total of $1,014.6 million appears to be enough (or perhaps more than enough) to fully fund the design and construction of the first ship in the program while also funding FY2019 and prior-year program administrative expenses. The Coast Guard’s FY2019 five-year (FY2019-FY2023) Capital Investment Plan (CIP) projected that the Coast Guard’s FY2020 budget would request an additional $125 million in FY2020 procurement funding for the PSC program, most of which would presumably be used as a second increment of procurement funding for the second ship in the class. The operational U.S. polar icebreaking fleet currently consists of one heavy polar icebreaker, Polar Star, and one medium polar icebreaker, Healy. In addition to Polar Star, the Coast Guard has a second heavy polar icebreaker, Polar Sea. Polar Sea, however, suffered an engine casualty in June 2010 and has been nonoperational since then. Polar Star and Polar Sea entered service in 1976 and 1978, respectively, and are now well beyond their originally intended 30-year service lives. The Coast Guard has used Polar Sea as a source of spare parts for keeping Polar Star operational. A Department of Homeland Security (DHS) Mission Need Statement (MNS) approved in June 2013 states that “current requirements and future projections ... indicate the Coast Guard will need to expand its icebreaking capacity, potentially requiring a fleet of up to six icebreakers (3 heavy and 3 medium) to adequately meet mission demands in the high latitudes....” Issues for Congress for the PSC program include, inter alia, whether to approve, reject, or modify the Coast Guard’s annual procurement funding requests for the program; whether to use a contract with options or a block buy contract to procure the ships; whether to continue providing at least some of the procurement funding for the PSC program through the Navy’s shipbuilding account; technical, schedule, and cost risk in the PSC program; and whether to procure heavy and medium polar icebreakers to a common basic design. Congressional Research Service Coast Guard Polar Security Cutter (Polar Icebreaker) Program Contents Introduction ..................................................................................................................................... 1 Background ..................................................................................................................................... 1 Missions of U.S. Polar Icebreakers ........................................................................................... 1 Statutory Duties and Missions ............................................................................................ 1 Multiple Missions (Not Just Icebreaking) ........................................................................... 2 Polar (Not Just Arctic) Operations ...................................................................................... 2 Current U.S. Polar Icebreakers and Polar Research Ships ........................................................ 3 Three Coast Guard Polar Icebreakers ................................................................................. 3 Three National Science Foundation (NSF) Polar Research Ships ...................................... 6 Summary ............................................................................................................................. 7 Required Numbers of U.S. Polar Icebreakers ........................................................................... 8 June 2013 DHS Polar Icebreaker Mission Need Statement ................................................ 8 Polar Icebreakers Operated by Other Countries ............................................................... 10 Coast Guard Polar Security Cutter (PSC) Program ................................................................ 12 Overview ........................................................................................................................... 12 Program Name .................................................................................................................. 12 Program Funding .............................................................................................................. 12 Desired Capabilities for New Polar Icebreaker ................................................................. 13 Notional Program Schedule .............................................................................................. 13 Acquisition Cost ............................................................................................................... 14 Contract Type .................................................................................................................... 16 Recent Acquisition Actions ............................................................................................... 16 Foreign Cooperation and Participation ............................................................................. 18 Issues for Congress ........................................................................................................................ 19 Funding Requests .................................................................................................................... 19 Contract with Options vs. Block Buy Contract ....................................................................... 19 Funding Coast Guard Polar Icebreakers through Navy’s Shipbuilding Account .................... 21 Technical, Schedule, and Cost Risk for PSC Program ............................................................ 23 Common Design for Heavy and Medium Polar Icebreakers .................................................. 24 Building Polar Icebreakers in Foreign Shipyards ................................................................... 26 Laws Relating to Building Ships in Foreign Shipyards .................................................... 26 October 2017 Press Report ............................................................................................... 27 Short-Term Bridge to One or More New Polar Icebreakers ................................................... 28 Overview: Two Basic Options .......................................................................................... 28 Coast Guard Plan is to Further Extend Life of Polar Star ................................................. 29 Another Option: Chartering an Icebreaker ........................................................................ 30 Acquisition vs. Leasing ........................................................................................................... 34 Legislative Activity for FY2019 .................................................................................................... 34 Summary of Appropriation Action on FY2019 Funding Request ........................................... 34 FY2019 DHS Appropriations Act (Division A of H.J.Res. 31/H.R. XXXX/S. 3109) ............ 35 House ................................................................................................................................ 35 Senate ................................................................................................................................ 36 Conference ........................................................................................................................ 36 Frank LoBiondo Coast Guard Authorization Act of 2018 (S. 140/P.L. 115-282) ................... 37 National Defense Authorization
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