Senate appropriators back Navy's plan to use two contractors for combat ships

Senate appropriators are backing the Navy’s plan to buy combat ships from two shipbuilders instead of just one, as initially planned. 

The Senate’s go-ahead for 20 new littoral combat ships is tucked into a 2,000-page omnibus spending bill that funds government agencies in fiscal year 2011. 

The House recently has already approved a similar provision in a stopgap measure, or continuing resolution, to cover government spending in 2011. If the Senate approves the omnibus, the House would have to approve it too.

The Navy is considering buying 10 new shore-hugging ships from both Austal USA and a team of Marinette Marine and Lockheed Martin. The Navy’s rationale is that competition has significantly reduced the price of the ships, which are designed to sweep for mines in coastal waters, fight pirates and chase drug smugglers.

The initial plan was to buy only 10 ships from one winning contractor. The Navy cannot move ahead with the new proposal to use two shipbuilders without congressional authorization. The two builders extended their bids through Dec. 30 to allow Congress to act. 

Austal would build the ships in Alabama, while Marinette would build its ships in Wisconsin. Sens. Richard Shelby (R-Ala.) and Herb Kohl (D-Wis.) are both defense appropriators and are backing the Navy’s new buying strategy for LCS. 

Despite the Senate appropriators’ backing for the Navy’s plan, it is not a done deal. Sen. John McCain, the leading Republican on military matters, has voiced significant concerns about the strategy and the LCS program, which has been plagued by delays and ballooning costs. McCain’s opposition could still derail, or at least delay, the congressional approval of the Navy’s plan.

“The story of this ship is one that makes me ashamed and embarrassed,” McCain said during an Armed Services Committee hearing convened at the last minute on Tuesday.  

McCain said that the program, which started almost 10 years ago, has been characterized by a “disgraceful waste of money.”  The Navy already spent $8 billion to build the first four shore-hugging ships and is slated to spend another $11 billion between 2010 and 2015. 

The Navy’s highest-ranking officials made their case before the Senate Armed Services Committee on Tuesday, pleading with senators to back their strategy to buy 10 ships from each competitor. 

Navy Secretary Ray Mabus said that the new plan would save $2.9 billion through 2016. The Navy would buy 20 ships for the price of 19, he said. If the Navy proceeded with its 20-ship plan, one ship would cost on average between $440 million and $460 million — a price below the current budget, according to Sean Stackley, the Navy’s acquisition chief. The Navy can’t give out the actual cost because of the proprietary information involved in the contract competition. 

The Navy officials assured lawmakers on Tuesday that Congress would have the ability to monitor and change the program on a year-to-year basis if it does not perform to the standards the Navy is predicting.