In the wake of Coast Guard Commandant’s Thad Allen
’s report to Congress regarding the Coast Guard and the 2008 budget, question linger as to the progress and future direction of the Integrated Deepwater System (IDS), the Guard’s far-reaching but recently embattled plan to replace or modernize major Coast Guard cutters, offshore patrol boats, fixed-wing aircraft, multi-missioned helicopters and the communications equipment, sensors, and logistics systems.
In his appearance before the U.S. House of Representatives on February 15, he said this regarding IDS: “The Coast Guard is also taking important steps to improve the management of the program by evaluating of the current acquisition strategy and reassessment of the acquisitions management structure.”
It appears that all options are open regarding the future of the contract.
We need to evaluate all options, and we haven't made a decision yet, Allen said, according to a Bloomberg report. We're asking, can the contract be modified to meet some of the goals expressed in the hearing?
Deepwater, the Coast Guard's largest ever acquisition, was launched as a joint venture of Northrop Grumman (NOC)
and Lockheed Martin (LMT)
. The cost was originally projected at $17 billion over 25 years before the Coast Guard last year increased the price by $7 billion and extended the time frame to 30 years.
Senator John Kerry is leading the charge to drop Lockheed and Northrop and put the contract out for competitive bids.
"The Coast Guard's Deepwater Program has been plagued by poor engineering, lax oversight, and cost overruns that will cost taxpayers billions of dollars,” Kerry said. “The flawed management structure of the program allowed the private contractors, Lockheed Martin and Northrop Grumman, to make management decisions that increased their bottom lines at the expense of taxpayers and national security.”
"When the current Deepwater contract expires in June, the Coast Guard should drop Lockheed and Northrop and hold an open and competitive bidding process for the remaining aspects of the program and ensure that management decisions are made by solely by the Coast Guard. The Coast Guard should also explore every legal option to re-coup funding from Lockheed/Northrop that it spent on poorly designed ships.”