```

[House Hearing, 109 Congress]
[From the U.S. Government Publishing Office]

 
                      THE PRESIDENT'S FISCAL YEAR
                   2007 BUDGET: COAST GUARD PROGRAMS
                      IMPACTING MARITIME SECURITY

=======================================================================

                                HEARING

                               before the

                   SUBCOMMITTEE ON ECONOMIC SECURITY,
              INFRSTRUCTURE PROTECTION, AND CYBERSECURITY

                                 of the

                     COMMITTEE ON HOMELAND SECURITY
                        HOUSE OF REPRESENTATIVES

                       ONE HUNDRED NINTH CONGRESS

                             SECOND SESSION

                               __________

                           FEBRUARY 15, 2006

                               __________

                           Serial No. 109-64

                               __________

       Printed for the use of the Committee on Homeland Security
                                     
[GRAPHIC] [TIFF OMITTED] CONGRESS.#13

                                     

  Available via the World Wide Web: http://www.gpoaccess.gov/congress/
                               index.html

                               __________

                     U.S. GOVERNMENT PRINTING OFFICE

36-400 PDF                 WASHINGTON DC:  2007
---------------------------------------------------------------------
For sale by the Superintendent of Documents, U.S. Government Printing
Office  Internet: bookstore.gpo.gov Phone: toll free (866)512-1800
DC area (202)512-1800  Fax: (202) 512-2250 Mail Stop SSOP, 
Washington, DC 20402-0001

                     COMMITTEE ON HOMELAND SECURITY

                   Peter T. King, New York, Chairman

Don Young, Alaska                    Bennie G. Thompson, Mississippi
Lamar S. Smith, Texas                Loretta Sanchez, California
Curt Weldon, Pennsylvania            Edward J. Markey, Massachusetts
Christopher Shays, Connecticut       Norman D. Dicks, Washington
John Linder, Georgia                 Jane Harman, California
Mark E. Souder, Indiana              Peter A. DeFazio, Oregon
Tom Davis, Virginia                  Nita M. Lowey, New York
Daniel E. Lungren, California        Eleanor Holmes Norton, District of 
Jim Gibbons, Nevada                  Columbia
Rob Simmons, Connecticut             Zoe Lofgren, California
Mike Rogers, Alabama                 Sheila Jackson-Lee, Texas
Stevan Pearce, New Mexico            Bill Pascrell, Jr., New Jersey
Katherine Harris, Florida            Donna M. Christensen, U.S. Virgin 
Bobby Jindal, Louisiana              Islands
Dave G. Reichert, Washington         Bob Etheridge, North Carolina
Michael McCaul, Texas                James R. Langevin, Rhode Island
Charlie Dent, Pennsylvania           Kendrick B. Meek, Florida
Ginny Brown-Waite, Florida

                                 ______

   Subcommittee on Economic Security, Infrastructure Protection, and 
                             Cybersecurity

                Daniel E. Lungren, California, Chairman

Don Young, Alaska                    Loretta Sanchez, California
Lamar S. Smith, Texas                Edward J. Markey, Massachusetts
John Linder, Georgia                 Norman D. Dicks, Washington
Mark E. Souder, Indiana              Peter A. DeFazio, Oregon
Mike Rogers, Alabama                 Zoe Lofgren, California
Stevan Pearce, New Mexico            Sheila Jackson-Lee, Texas
Katherine Harris, Florida            James R. Langevin, Rhode Island
Bobby Jindal, Louisiana              Bennie G. Thompson, Mississippi 
Peter T. King, New York (Ex          (Ex Officio)
Officio)

                                  (II)
                            C O N T E N T S

                              ----------                              
                                                                   Page

                               Statements

The Honorable Daniel E. Lungren, a Representative in Congress 
  From the State of California, and Chairman, Subcommittee on 
  Economic Security, Infrastructure Protection, an Cybersecurity.     1
The Honorable Loretta Sanchez, a Representative in Congress From 
  the State of California, and Ranking Member, Subcommittee on 
  Economic Security, Infrastructure Protection and Cybersecurity.     3
The Honorable Bennie G. Thompson, a Representative in Congress 
  From the State of Mississippi..................................     4
The Honorable Norman D. Dicks, a Representative in Congress From 
  the State of Washington........................................    11
The Honorable James R. Langevin, a Representative in Congress 
  From the State of Rhode Island.................................    19
The Honorable Sheila Jackson-Lee, a Representative in Congress 
  From the State of Texas........................................    18
The Honorable Mark E. Souder, a Representative in Congress From 
  the State of Indiana...........................................    13

                                Witness

Admiral Thomas H. Collins, Commandant, U.S. Coast Guard:
  Oral Statement.................................................     5
  Prepared Statement.............................................     6

                             For the Record

Questions for Admiral Thomas H. Collins..........................    21

                    THE PRESIDENT'S FISCAL YEAR 2007

                      BUDGET: COAST GUARD PROGRAMS

                      IMPACTING MARITIME SECURITY

                              ----------                              

                      Wednesday, February 15, 2006

                     U.S. House of Representatives,
                    Committee on Homeland Security,
                         Subcommittee on Economic Security,
              Infrastructure Protection, and Cybersecurity,
                                                    Washington, DC.
    The subcommittee met, pursuant to call, at 5:00 p.m., in 
Room 311, Cannon House Office Building, Hon. Daniel Lungren 
[chairman of the subcommittee] presiding.
    Present: Representatives Lungren, Souder, Sanchez, 
Thompson, Dicks, Jackson-Lee, Langevin, and DeFazio.
    Mr. Lungren. [Presiding.] The Committee on Homeland 
Security's Subcommittee on Economic Security Infrastructure 
Protection and Cybersecurity will come to order.
    The subcommittee is meeting today to hear testimony on the 
president's fiscal year 2007 budget and Coast Guard programs 
impacting maritime border security.
    Today, we will hear from Admiral Thomas Collins, the 
commandant of the United States Coast Guard. I want to thank 
the commandant for his testimony and his appearance before us 
today.
    I know you leave tomorrow for a long trip overseas, and 
thank you for making it a priority to appear before this 
subcommittee.
    As the lead federal agency for maritime security, the Coast 
Guard has the awesome task of protecting our waterways and 
securing our nation's ports. For over 200 years, the Coast 
Guard has done a great job patrolling and protecting our 
coastlines, which total over 95,000 miles.
    The Coast Guard also plays a key role in pushing out our 
borders further from our shores in order to prevent terrorists 
and terrorist weapons from arriving at U.S. shores.
    2005 proved to be a banner year for the Coast Guard, 
testing its assets, capabilities and personnel like never 
before. The year began in January of 2005 when the Coast Guard 
was called upon to provide support to Tsunami relief 
operations. The Coast Guard also maintained six patrol boats 
off the coast of Iraq in support of Operation Iraqi Freedom, 
and the nation watched in awe as the Coast Guard rescued over 
33,000 persons in search and rescue operations in the wake of 
Hurricanes Katrina and Rita.
    The Coast Guard performed admirably under extremely 
difficult circumstances, and I want to take this opportunity to 
commend the Coast Guard for its performance this past year.
    But with such performance we want to ensure that the 
president's fiscal year 2007 budget request of $8.4 billion for 
the Coast Guard accounts for the inevitable toll placed upon 
legacy assets while also allowing for continued performance of 
the Coast Guard's vital homeland security missions, which does 
include ports, waterways and coast security, drug and migrant 
interdiction, defense readiness and other law enforcement as 
well as continued performance of the Coast Guard's non-homeland 
security mission.
    Specifically interested to hear about the long-term effects 
this successfully arduous year may have had on the deepwater 
assets delivery schedules, including the Coast Guard's HH-65C 
Helicopter Reengineering Program and the delivery of the first 
national security cutter expected in fiscal year 2007.
    The Coast Guard's budget plans to add another important 
homeland security mission to its repertoire: protection of the 
National Capital Region's airspace. This may beg the question, 
how does the Coast Guard plan to add this mission? Also the 
question, where will the assets and personnel in support of 
this mission come from?
    We are very interested in your thoughts on the mission 
creep and would ask you to explain to us why the Coast Guard is 
the best suited federal agency for this particular mission.
    Another are that I would like to explore today is the 
proposed transfer of the drug interdiction mission from the 
homeland security mission to a non-homeland security mission. I 
am concerned about such a proposal, because time has shown and 
intelligence has proven that drug traffickers and human 
smugglers often use the same routes, routines and techniques.
    A hidden compartment on a ship conceals drugs, people or 
both. In addition to the fact that terrorist organizations 
utilize the drug trade as a means to finance its operation, I 
am concerned that that transfer in categories might somehow 
result in a loss of assets for that mission.
    Coast Guard has announced its intention to transfer the 
current enhanced maritime safety and security team, commonly 
referred to as EMSST, to an interagency effort with the 
Departments of Defense and Justice with the 24/7 capability to 
be called the Maritime Security Response Team. This appears to 
be a worthwhile effort, but I have questions about the 
interagency negotiations that have taken place to date and how 
the responsibilities will be delineated and chain of command 
issues resolved.
    Lastly, the committee is interested in learning about the 
proposed relocation of the Coast Guard headquarters. I 
understand the initial cost will be $50 million, not to mention 
$306 million GSA will be investing in fiscal year 2007. Is this 
the best use of federal resources at this time for this agency, 
and what will be the organizational benefits achieved through 
the new facility?
    I have also been informed of an unfortunately accident that 
occurred this last week involving one of your older rescue 
helicopters not too far from my district on the coast of 
California. What does that say about the state of your current 
assets and their maintenance and also assets to take their 
place?
    I look forward to the insights that you will provide us on 
these important issues today, and, again, I thank you for your 
appearance before the subcommittee.
    I would now recognize the ranking member, Ms. Sanchez, for 
any opening statement she may wish to make at this time.
    Ms. Sanchez. Thank you, Mr. Chairman.
    And hello, Admiral Collins. Good to see you again here. 
Thank you for you coming up to talk to us today.
    Whether it is rescuing the victims of Katrina or protecting 
our ports or stopping the flow of illegal drugs or rescuing 
distressed boats, people who are out for recreational reasons, 
the Coast Guard has actually proven to be really the bright 
light in most of what we see in our capability as far as a 
government agency.
    Since 9/11, the Coast Guard has taken the lead in securing 
our ports in our maritime transportation system, and that is 
critical, especially to someone like me who lives just 20 
minutes away from the third largest port system in the world, 
L.A. Long Beach Port, where 20 percent of trade that moves from 
outside comes through that area. So I am very thankful for the 
work that the Coast Guard is doing.
    And I think you also understand, and you understood it 
almost from the very beginning, that an attack on our port is 
something that is significant. I remember the slowdown a few 
years ago at Christmastime in the port system where we had all 
of the ships lined up going all the way down almost to the 
Mexican border in California. And just the economic impact of 
things slowing down, I think it cost us, they estimated 
something like $2 billion a day for the 10 days that we had 
that lockout on the ports.
    So I am very glad that you have all done a good job, have a 
commitment, have an agenda, have really managed well the port 
system, not just where I live but to the north up in the 
Oakland area. And I am sure across the United States you have 
been just as agile and wonderful about doing this. All from 
Katrina we saw the bright light was really the Coast Guard.
    I am concerned on a lot of fronts. I am just concerned that 
your agency is taking on a lot of responsibility, that we are 
pushing a lot of new responsibility onto you in particular. For 
example, the mission of airspace security in the National 
Capital Region. And I am glad that the budget includes funding 
for that, but I am just apprehensive.
    It almost seems like you are the good employer that is 
working harder, working better, and so the more you work the 
more things we throw at you, and there are other agencies and 
things that just are not getting the job done and not 
performing well and therefore more and more of the burden is 
falling to the Coast Guard.
    So I want to voice my support for the development of the 
Maritime Security Response Team, which will be stationed in 
Virginia. I think it will enhance the federal government's 
counterterrorism capabilities in the maritime arena. And 
although the budget only funds an east coast team, I really 
would like to stress the importance of also having an east and 
a west coast team. I think that is important to both the 
chairman and myself as Californians.
    I am also worried about the pace of Deepwater, the 
Deepwater Program, and I think that decreasing the funding for 
that program is going to put the Coast Guard behind in having 
the fleet, the cutters, the aircraft that you need. So maybe 
you can during your time talk a little bit about if you have 
any concerns with respect to that.
    I just think that we need to make available the assets that 
you need in order to do the good work that you are doing.
    And, finally, Admiral, I understand that you will be 
retiring in May, and I want to thank you for giving 38 years of 
your life in service to this country.
    And with that, Mr. Chairman, look forward to hearing the 
admiral's comments.
    Mr. Lungren. I thank you for your comments, and you can 
understand that we view you as the antithesis of the government 
Maytag repairman. You guys are always ready but you are always 
used.
    I would like to recognize now the Ranking Minority Member 
of the full committee, the gentleman from Mississippi, Mr. 
Thompson, for any statement he may make.
    Mr. Thompson. Thank you, Mr. Chairman, Ranking Member 
Sanchez.
    Admiral Collins, welcome. I want to join the chorus of 
those individuals who thank you and other members of the Coast 
Guard for a job well done during the Katrina disaster that we 
had. My district and a lot other districts was significantly 
impacted by it. The bright star was the Coast Guard. Thirty-
three thousand people absolutely could not have made it without 
your help and assistance.
    I only wish the rest of FEMA and DHS could be equally as 
competent about how they do their job.
    The other thing I am concerned about Deepwater. If we 
continue on the program as outlined with the cuts, I do not 
think we will make it. 2026 is far too long to try to retool 
our Coast Guard. I do not know what we will have left to retool 
if 2026 is the out-year. So some of us, as you know last year, 
supported significant resources for Deepwater in order to 
accomplish what we all agreed, that the Coast Guard is needed.
    I am a little concerned that we get from this 
administration lip service, but when it comes time to really 
put the money where their mouths are, we come up short. I can 
assure you that a lot of us will work hard during this 
authorization effort to try to put additional monies where we 
know they have to be. Equipment wears out; it has to be 
replaced. So we will work on that.
    I would like to also at some point get you to talk a little 
bit about what kind of equipment the Coast Guard used during 
Katrina and how did it fair under that, and have we replaced we 
wore out during Katrina? If not, we need to look at that as a 
source of concern for our part.
    And, lastly, Ms. Sanchez indicated that you will, I would 
assume sometime this year, depart from the Coast Guard, and I 
would want to make sure that you know how I feel, along with 
the other members, that you have done a wonderful job. Your 
leadership has been admirable. And as they say, I wish you fair 
winds and following seas.
    I yield back.
    Mr. Lungren. Thank you, Mr. Thompson.
    Other members of the committee are reminded that opening 
statements may be submitted for the record.
    We are pleased to have the distinguished witness before us 
today on this important topic. And if I were to adequately go 
through your biography, we would have no time.
    So I am just going to say that the chair recognizes Admiral 
Thomas Collins, commandant of the U.S. Coast Guard, to testify.
    And let me just remind you, sir, that your entire written 
statement will appear in the record.

STATEMENT OF ADMIRAL THOMAS H. COLLINS, COMMANDANT, U.S. COAST 
                             GUARD

    Admiral Collins. Thank you, Mr. Chairman and distinguished 
members of the subcommittee. It is a real pleasure and 
opportunity to appear before you to talk about the 2007 budget.
    We are a very interesting organization. We have got a blend 
of law enforcement authorities, regulatory authorities, 
military authorities, Title 10 authorities. It is kind of a 
unique blend of authorities in our government, and it gives us 
a military, multi-mission, maritime character to our 
organization and a unique blend of humanitarian, law 
enforcement, regulatory, diplomatic capability that we can 
bring to bear.
    And as you noted, Mr. Chairman, I think we did work pretty 
successfully at bringing all those authorities and capabilities 
to bear in 2005. I think it is pretty--we do not have a totally 
unbiased view of this but I think a pretty impressive record of 
accomplishment across our missions.
    We have noted our aggressiveness and response to the 
hurricane disasters in the Gulf, but I would submit the 
lifesaving got a lot of the recognition, as it should, but we 
also responded to 8 million gallons of oil spills. We got the 
ports and waterways back, assessed and cleared and back in 
operation within a matter of--some were moving the next day. 
The intercoastal waterway was brought back to life.
    We worked very, very hard, especially when about 80 to 90 
percent of, in some cases, our aids-to-navigation were 
destroyed by the storm, and those were all put back either 
temporarily or permanent aids to keep the traffic moving.
    So we were busy across the board, whether it was lifesaving 
or environmental protection or our waterways management 
business.
    Other notable things that I am very, very proud of our men 
and women is our continued effort in our counterdrug 
operations. We have got this exponential curve of success 
going, which is a nice trend. We keep beating each year by some 
substantial margin the preceding year's total seizure of 
cocaine. We are surpassing last year 300,000 pounds of cocaine 
seized at sea, and our interagency coordination is being 
refined and getting better and better, our application of intel 
better and better, coalition forces, et cetera. And I think we 
are really making a dent on that and very, very proud of that 
trend of performance within the counterdrug operation.
    Counterdrugs and counterdrug operations remain a very, very 
high priority with the United States Coast Guard.
    But our people our delivering. You mentioned our role in 
port security and the implementation of these national ship and 
port security code and Maritime Transportation Security Act. It 
is the biggest regulation in the history of the United States 
Coast Guard that we put into effect in less than a year, and we 
are getting great, great compliance rates out of that.
    The 2007 budget, this is a challenging budget environment, 
as we all know, but I think I am pleased with the presentation 
that we have in the 2007 budget. It does position the Coast 
Guard to continue our record of operational excellence. It does 
provide for investments that strengthen our preparedness, that 
invest in our ability to be more aware of things going on in 
the maritime environment, and it builds on our capability to 
respond effectively as first responders.
    For instance, nearly $100 million in operating expense 
funding to support our operation and maintenance of our 
cutters, as well as bringing on the new assets that we are 
requiring, and important funds within that envelope for 
sustaining our older cutters.
    It also includes $89 million to build what we term maritime 
domain awareness. It is a fancy term to say, how do you get 
transparency of the people, cargo and vessels in the maritime 
through processes, systems and so forth? So there is investment 
in that, as part of Deepwater and elsewhere, automatic 
identification system infrastructure that we are implementing 
nationwide.
    And, finally, of course, the big investment, as you have 
already alluded to, Mr. Chairman, is Deepwater. That is just 
the most important acquisition in the history of our service, 
back to 1790, as far as I am concerned. Incredibly important 
acquisition that is spread over a number of years.
    And this budget does in fact allow us to keep going, 
pushing ahead forward on a number of important items within 
that budget, including the national security cutter, the 
modernization and the conversion of our helicopter fleet, the 
acceleration of our fast-response cutter, the patrol boat that 
does so much in the Caribbean and elsewhere. We are 
accelerating that by over 10 years and moving that forward.
    So on a number of fronts, and this is just tip of the 
iceberg that I have mentioned, but a number of fronts that 
allows us to, again, build up preparedness, to get better at 
awareness of things happening in the maritime and in building 
the capabilities we need to do the job.
    Look forward to the committee to work through these issues. 
I would be glad to answer the questions that you have already 
posed in your statement and be pleased to respond to those 
specific questions.
    Thank you for the opportunity to appear before you, Mr. 
Chairman.
    [The statement of Admiral Collins follows:]

            Prepared Statement of Admiral Thomas H. Collins

    Good afternoon Mr. Chairman and distinguished members of the 
committee. It is a pleasure to be here today to discuss the Coast 
Guard's FY 2007 budget request.
    The Coast Guard is one of the Nation's five Armed Services. Its 
mission is to protect the public, the environment and U.S. economic 
interests--in the Nation's ports and waterways, along the coast, on 
international waters and in any maritime region required to support 
national security. The Coast Guard is the lead Federal agency for 
maritime homeland security; a role supported by its unique complement 
of authorities, maritime capabilities, proven competencies, and 
longstanding domestic and international partnerships. Executing this 
role requires a Coast Guard that is ready to act, enabled by awareness, 
as well as equipped to sustain an effective presence and mount an 
effective response to maritime threats.
    Coast Guard forces are flexible, rapidly employable and able to 
respond to crises with a full range of capabilities. It is a military, 
multimission and maritime service that has adapted to growing mission 
demands to enhance maritime security while continuing to meet other 
mission requirements. For example, in 2005, the Coast Guard:

    --Secured the maritime border:
         Completed verification of security plans, required by 
        the Maritime Transportation Security Act (MTSA), for U. S. port 
        and facilities and vessels operating in U. S. waters;
         Completed 31 foreign port security assessments in 
        order to improve our awareness of foreign port compliance with 
        international requirements;
         Prevented more than 338,000 pounds of cocaine (an all-
        time maritime record) and over 10,000 pounds marijuana from 
        reaching the United States;
         Interdicted nearly 9,500 undocumented migrants 
        attempting to enter the country illegally by sea, the second 
        highest number of any average year in the past 20 years;
    --Enhanced national maritime preparedness:
         Began comprehensive security reviews of waterside 
        nuclear power plants;
         Created formal processes for addressing security 
        concerns and requirements involving the siting of new shore-
        side Liquefied Natural Gas facilities;
         Established a new Area Maritime Security Exercise 
        program requiring annual local exercises, and is designed to 
        assess the effectiveness of the Area Maritime Security Plans 
        and the port community's preparedness to respond to security 
        threats and incidents. Funding appropriated for FY 2006 will 
        bolster this effort significantly.

    --Strengthened partnerships:
         Established a National Maritime Security Advisory 
        Committee in order to provide a strategic public-private forum 
        on critical maritime security topics;
         Launched America's Waterways Watch, a citizen 
        involvement program that leverages the Coast Guard's 
        relationship with the maritime public;
         Deployed the Homeport information sharing web portal, 
        which allows for collaboration and communication in a 
        controlled security environment (for sensitive but unclassified 
        material) among Area Maritime Security Committee members and 
        port stakeholders at large;
         Conducted more than 268,000 port security patrols, 
        5,800 air patrols and 26,000 security boardings; and
         Provided security escorts to over 10,000 vessels.

    Saved lives and property:
         Saved over 33,000 lives in the wake of Hurricanes 
        Katrina and Rita, one of the largest search and rescue 
        operations in United States history;
         In addition to hurricane response, responded to more 
        than 32,000 calls for maritime rescue assistance;
         Saved the lives of over 5,600 mariners in distress;

    Protected the environment:
         Boarded more than 6,000 fishing vessels to enforce 
        safety and fisheries management regulations, a 30 percent 
        increase over 2004;
         Conducted more than 3,000 inspections aboard mobile 
        offshore drilling units, outer continental shelf facilities and 
        offshore supply vessels;
         Responded to 23,904 reports of water pollution or 
        hazardous material releases from the National Response Center, 
        resulting in 4,015 response cases;

    --Facilitated maritime commerce:
         Kept shipping channels and harbors open to navigation 
        during the Great Lakes and New England winter shipping season;
         Ensured more than 1 million safe passages of 
        commercial vessels through congested harbors, with Vessel 
        Traffic Services;
         Maintained more than 50,000 federal aids to navigation 
        along 25,000 miles navigation channels;

    --Supported national defense
         Safely escorted more than 169 military sealift 
        movements at 13 different major U.S. seaports, carrying more 
        than 20 million square feet of cargo;
         Maintained an active patrol presence in the Arabian 
        Gulf in support of the U.S. Navy and allied naval units.
    More than singular statistics or accomplishments, the above list, 
in total, demonstrates the winning formula of a military, multimission 
service founded on core operational principles such as flexibility, on-
scene initiative and unity of effort. It is this time-tested 
operational model that allows the Coast Guard to meld its safety and 
security roles into a seamless set of maritime strategies designed to 
guarantee the safety and security of the U.S. maritime domain.
    The FY 2007 budget request supports critical initiatives needed to 
preserve the Coast Guard's ability to respond to current mission 
demands, while enhancing capabilities to counter emerging threats and 
strengthen its preparedness across a broad range of missions.

2007 Budget
    The above accomplishments are only possible with a Coast Guard that 
is Ready, Aware and Responsive. The President, Congress and public 
expect nothing less: Ready to prevent and respond to a broad range of 
maritime safety and security requirements; Aware of what is going on in 
our ports, along our coasts and on the high seas; and most of all, 
Responsive whenever and wherever there is a need for the Coast Guard to 
save lives, secure maritime borders, protect natural resources, 
facilitate maritime commerce or contribute to national defense. The 
fiscal year 2007 request delivers on these expectations through its 
focus on three key investment priorities:
         Strengthen Preparedness [READY],
         Maximize Awareness [AWARE], and
         Enhance Capability [RESPONSIVE]
    The Integrated Deepwater System (IDS) acquisition program remains 
the centerpiece of a more ready, aware and responsive 21st-century 
Coast Guard. The 2007 Budget provides a Deepwater investment plan that 
provides funding for:
        --Constructing the fourth National Security Cutter;
        --Producing the first Fast Response Cutter;
        --Acquiring the sixth Maritime Patrol Aircraft;
        --Bolstering the network of command, control, communications, 
        computers, intelligence, surveillance and reconnaissance 
        (C4ISR) technology;
        --Completing the HH-65 re-engining; and
        --Initiating several essential legacy conversion projects, 
        including installation of airborne use of force equipment 
        aboard 36 helicopters.
    While the Deepwater program necessarily invests in capabilities 
adequate to operate in the often unforgiving offshore environment, it 
is these same capabilities that are instrumental to effective response 
operations in port and coastal areas as well. For example, assets 
scheduled for modernization under the Deepwater program include every 
Coast Guard aircraft type. These aircraft, rotary-wing in particular, 
are critical parts of our port and coastal response infrastructure as 
well as extended offshore operations. The Deepwater program's 
conversion and/or enhancement of legacy aircraft and cutters are making 
an impact now. The operational benefits were apparent during the Coast 
Guard's response to Hurricane Katrina. As an example, three more 
powerful re-engined HH-65C helicopters flew 85 sorties to save 305 
lives. The converted aircraft can hoist 280 more pounds and stay on-
scene longer than its predecessor. Similarly, the C4ISR improvements to 
high and medium endurance cutters enabled more effective on-scene 
coordination of rescue operations in New Orleans, LA, and Gulfport, MS, 
with local first responders and other Federal agencies.
    Strengthen Preparedness. Coast Guard readiness is a cornerstone of 
national maritime preparedness. Strengthening preparedness within the 
U.S. maritime domain is a core competency and responsibility of the 
Coast Guard. It depends directly on the readiness of Coast Guard 
cutters and aircraft, infrastructure and personnel. The FY 2007 
requests funding to preserve and strengthen Coast Guard readiness. 
Relevant budget initiatives include:
         Depot level maintenance and energy account: $51.3 
        million to close inflationary cost growth gaps. These are bills 
        that must be paid; without increased funding, Coast Guard 
        readiness will be eroded.
         Medium endurance cutter mission effectiveness project: 
        $37.8 million to support the Mission Effectiveness Project 
        (MEP) for 270-foot and 210-foot Medium Endurance Cutters 
        (WMEC). Our 210-foot and 270-foot cutters are currently 
        operating with obsolete equipment and subsystems that must be 
        replaced. The project includes replacing major sub-systems such 
        as small boat davits, oily water separators, air conditioning 
        and refrigeration plants, and evaporators. The main propulsion 
        control and monitoring systems will also be upgraded. This 
        effort is vital to sustain our legacy fleet of medium endurance 
        cutters until they are recapitalized.
         Operations and Maintenance for new assets: $30.5 
        million to fund operations and personnel for the airborne use 
        of force program, the first national security cutter, new 
        maritime patrol aircraft and secure communications systems; 
        $42.3 million for Deepwater logistics support.
         Personnel protective equipment: $7.2 million to 
        replace obsolete oxygen breathing apparatus aboard ships and 
        training centers with safer self-contained breathing apparatus 
        (SCBA). Over the past 30 years, all shore-based Federal and DOD 
        fire fighters, the Military Sealift Command, all western 
        navies, all merchant ships, the U.S. Air Force and all U. S. 
        Navy flight deck personnel have adopted and use exclusively the 
        open circuit SCBA. The Navy is currently replacing all their 
        OBAs with SCBAs. This leaves the Coast Guard as the only fire 
        fighting organization without SCBA for its personnel. In order 
        to ensure the personal protection of Coast Guard personnel 
        while serving aboard Coast Guard cutters, the transition from 
        using the obsolete OBA to the SCBA is essential.
         Shore infrastructure and aids-to-navigation: $25.9 
        million to recapitalize aids-to-navigation nationwide and 
        rebuild or improve aged shore facilities in Cordova, Alaska 
        (housing), Integrated Support Command Seattle and Base 
        Galveston. Facing a $1.4 billion shore maintenance backlog, 
        funds are necessary to improve critical shore infrastructure 
        essential to supporting Coast Guard personnel as they execute 
        missions and operational requirements.
    Maximize Awareness. Securing our vast maritime borders depends upon 
our ability to enhance maritime domain awareness (MDA). Effectively 
addressing maritime vulnerabilities requires maritime strategies that 
not only ``harden'' targets but detect and defeat threats as far from 
U.S. shores as possible. Identifying threats as far from U.S. shores as 
possible requires improved awareness of the people, vessels and cargo 
approaching and moving throughout U.S. ports, coasts and inland 
waterways. Relevant budget initiatives include:
         Nationwide Automatic Identification System: $11.2 
        million to continue procurement plans and analysis for 
        deployment of a nationwide system to identify, track and 
        exchange information with vessels in the maritime domain.
         Maritime Domain Awareness: $17 million to support 
        follow-on and new initiatives, including a new Coast Guard 
        counterintelligence program, prototype Sector and Joint Harbor 
        Operation Center support, and expanded secure communications 
        system infrastructure.
         Deepwater C4ISR: $60.8 million to develop and install 
        systems and subsystems that are part of the Deepwater Command, 
        Control, Communications, Computer, Intelligence, Surveillance 
        and Reconnaissance (C4ISR) system. This system is designed to 
        support designated Coast Guard commanders in the exercise of 
        authority while directing all assigned forces and first 
        responders across the full range of Coast Guard operations. 
        This system of ``eyes and ears'' allows us to see, hear and 
        communicate activity occurring within the maritime domain, 
        which is critical to deterring and defeating threats before 
        reaching our shores.
    Enhance Capability. Just as important to being ready and aware is 
equipping and training Coast Guard personnel with the capabilities and 
competencies to respond effectively. For example, the advance 
information required of vessels arriving to the United States is 
critical to understanding who and what is arriving in order to identify 
potential threats. However, if Coast Guard cutters and aircraft do not 
have the capabilities necessary to deal with identified threats early 
and effectively, an opportunity to mitigate risk is lost. Relevant 
budget initiatives include:
         Deepwater: $934.4 million (total). The FY 2007 request 
        for the Deepwater program reflects the Administration's 
        continued commitment to the recapitalization of the Coast 
        Guard's aircraft and ships and the network that links them 
        together into an integrated system. More capable and reliable 
        cutters, boats, aircraft and associated systems will enhance 
        safety and security in U. S. ports by improving the Coast 
        Guard's ability to perform all its missions. Specifically, the 
        FY 2007 request provides funding for: the fourth National 
        Security Cutter, the first Fast Response Cutter, HH-65 and HH-
        60J conversions, new maritime patrol aircraft, HC-130J 
        operations, sustaining the HC-130H, arming two HH-60's and 34 
        HH-65's at seven Air Stations, and development of shipboard and 
        land-based vertical unmanned aerial vehicle systems.
         Rescue 21: $39.6 million to continue system design 
        (two locations), preparation (four locations) and installation 
        (seven locations). The Rescue-21 project represents a quantum 
        leap in maritime communications technology, enhancing 
        effectiveness across all coastal missions.
         National Capital Region air defense: $62.4 million to 
        establish infrastructure, acquire additional aircraft and fund 
        operations for this newly assigned homeland security mission in 
        the Nation's capital. The Air Defense mission in the National 
        Capital Region rests with the Department of Defense (DOD) under 
        the construct of OPERATION NOBLE EAGLE. Through a Memorandum of 
        Understanding, DOD has assigned this requirement to the 
        Department of Homeland Security (DHS). The Coast Guard has been 
        directed to execute this requirement on behalf of DHS. 
        Requested funding is critical to stand-up this new capability 
        and avoid negative impacts to other Coast Guard mission-
        programs.
         Response Boat--Medium: $24.8 million to begin low-rate 
        initial production to replace 41-foot utility boats and non-
        standard boats.
         Maritime Security Response Team (MSRT): $4.7 million 
        to provide additional personnel and transform the prototype 
        Enhanced Maritime Safety and Security Team in Chesapeake, Va. 
        into an MSRT, providing on-call maritime counter-terrorism 
        response capacity. This request will also enhance maritime 
        counter-terrorism training facilities at the Coast Guard 
        Special Missions Training Center at Camp Lejeune, N.C.

Conclusion
    During the response to Hurricane Katrina, the Nation saw the value 
of a ready, aware and responsive Coast Guard. Rescuing more than 33,000 
people in a two-week period, Coast Guard men and women from around the 
Nation contributed to this historic operation. Of course, that was only 
the most visible Coast Guard achievement in 2005. From record-breaking 
drug interdictions to continued implementation of the Maritime 
Transportation Security Act, the Coast Guard again delivered tremendous 
results for the American people. Full support of the 2007 budget 
request is vital to ensuring we sustain these results.
    No one can predict the timing of the next catastrophic event akin 
to Katrina, or whether it will be natural or man-made. Nonetheless, 
history tells us it will come. When it does, it will be vital that we 
have done all we can to build a Coast Guard that is prepared to answer 
the call, supremely aware of the maritime environment and poised for 
dependable response. The Nation saw in 2005 what I have known for 
decades--if we give Coast Guard men and women the training and 
equipment to do the job, they won't let us down.
    Thank you for the opportunity to testify before you today. I will 
be happy to answer any questions you may have.

    Mr. Lungren. Thank you very much. I yield myself 5 minutes.
    On the Deepwater Program, how do you compare it with what 
you were coming up with last year to this year?
    What have been the negative effects, if any, as a result of 
Katrina, both in terms of--obviously, it added more service 
time to your assets, but also isn't Pascagoula the location of 
where you are going to get one of your major assets? And as I 
understand it, they took a pretty big hit as a result of the 
storm.
    If you could respond to those two things.
    Admiral Collins. Yes, sir. As far as the overall plan, we 
are working on the revised implementation plan for Deepwater 
that we presented to Congress last summer. We are still on 
course for that program. That program adjusted for the post-9/
11 environment and made some programmatic adjustments, 
capability adjustments to some of the platforms and adjusted 
when they appear in the transition of the overall program.
    Mr. Lungren. Let me just interrupt for a second. But as a 
result of the budget you are presenting to us today, does that 
get you further along toward your goal of your deepwater assets 
in terms of a timeline?
    Admiral Collins. Yes, sir.
    Mr. Lungren. --or how do we?
    Admiral Collins. No. It is moving ahead, sir. For instance, 
the national security cutter is our fourth cutter. The national 
security cutter, that is a big one. We are building eight of 
those. That is in this budget. Patrol boat money is in the 
budget, aircraft conversion money is in the budget. So we are 
advancing along that timeline.
    In terms of Katrina and the impact on Pascagoula, there was 
adverse impact, just like there was for Navy shipbuilding 
programs as well. We roughly estimate probably a 4-month delay 
or so in the first and second national security cutter because 
of that storm. There is impact on equipment in the yard, impact 
on workforce and so forth, impact on the vessel itself.
    And probably some increased costs. We know that somewhere 
between probably $20 million and $80 million additional because 
of the delay and the problems associated with that hurricane, 
some of which has already been appropriated in the supplemental 
and more we are going to have to identify in the fourth 
supplemental that we are likely to come forward with Katrina.
    So, yes, there has been impact by Katrina, but the shipyard 
is back in operation. I was just down there last week walking 
around that new ship, the Coast Guard cutter, Bertholf. It is 
about 50 percent done. It is going to be a terrific ship. It is 
going to have vertical UAV capability, helicopter capability, 
twin stern launch with over-the-horizon small boats. It is 
going to be a very, very capable platform for our missions.
    Mr. Lungren. What about the impact of the actual increased 
use of your assets during those two hurricanes? I mean, I know 
you project you are going to use your assets, but those are 
pretty heavy loads.
    Admiral Collins. We build to increase maintenance, and 
operation cost is built into our Katrina supplemental to pay 
for those costs and for some of the maintenance. And as I 
mentioned, we also have an uptick in operation and maintenance 
funding within our 2007 budget request to account for some of 
those as well.
    Mr. Lungren. And the question I was not going to ask until 
I was made aware of the accident that occurred off Humboldt Bay 
this past week, I guess it was, you have been warning us for 
some time about the useful life of your helicopters, about the 
standards that you have to use versus what would be allowed in 
the civilian arena. Is this an unfortunate evidence of the need 
to accelerate our effort to modernize that element of your 
assets?
    Admiral Collins. Probably a little too early to rush to 
judgment on that. It just happened. In all of these type of 
things, we have a formal Mishap Investigation Board that will 
look at every nook and cranny of that accident, how it 
happened. The helo was set down in the water. The folks all 
egressed safely and successfully. We have recovered the helo; 
the engineers say it is salvageable. So those are good things.
    The investigation is ongoing, and we do not have, again, 
even an interim report on some of the issues, but very, very 
preliminary it looks like there may be human factors, issues 
associated with that accident, more than a maintenance or 
reliability issue with the helicopter. But we will know more 
when we get the mishap investigation completed. We would be 
more than happy to provide the committee with a full blow-by-
blow on that accident.
    Mr. Dicks. Will the chairman yield just briefly?
    Mr. Lungren. I will yield the 1 second I have left.
    Mr. Dicks. How old of a helicopter was this?
    Admiral Collins. These helicopters, oh boy, I think they 
are about 18 years old, sir.
    Mr. Dicks. Thank you.
    Mr. Lungren. My time has expired.
    I recognize the gentlelady for 5 minutes.
    Ms. Sanchez. Again, thank you, Admiral.
    When you testified before the committee in June, I asked 
you about the maritime infrastructure recovery plan required by 
HSPD-13. All of us are aware of the significance of a shutdown 
of a port.
    I would like to know when it was released, when the 
strategy was released on June 21, the maritime infrastructure 
recovery has still not been completed. So according to the 
Department, the completion of the plan was delayed because the 
administration wanted to incorporate some lessons learned from 
the Katrina incident.
    So I would like to know when is the plan going to be 
completed? And what were the challenges faced by the Coast 
Guard during Hurricane Katrina, and what challenges are faced 
in terms of restoring port operations? And what steps are taken 
to ensure that commerce will continue to flow?
    Admiral Collins. I will have to get back to you on our best 
estimate on when you will get that report. The overarching 
strategy, of course, was published last September, the national 
maritime security strategy, and there were several moving parts 
to that, about eight different subordinate plans, that being 
one of them. Hopefully it will be a this spring thing, but let 
me get back to the committee with a specific--give you the best 
date I can on that.
    In terms of Katrina, obviously, there are a whole bunch of 
people studying that, what went right and what went wrong, and 
just this week, obviously, a lot of things coming out. I think 
that common to a lot of them is the issue of unity of command 
issues and information flow and timeliness of information. I 
mean, those are going to be central features to every--
    Ms. Sanchez. The whole issue of the port facilities.
    Admiral Collins. The port facilities itself, I mean, I 
think our response to the port, I think, and how we dealt with 
the port and got the port and the waterway back in operation, I 
think a lot of things went right.
    What went right was we live and work in the communities we 
serve. We do not parachute in when there is an incident. We are 
there. We have over 2,400 people in Mississippi and Louisiana, 
for example. They are stationed there; they live there. Many of 
them lost their own homes as well.
    They build partnerships in the community, they build 
partnerships with the American waterways operator, they build 
partnerships with the pilot, they build partnerships with the 
salvage operators.
    And when we moved our district office from New Orleans to 
Alexandria, Louisiana, that was our emergency site, if you went 
into that command center in there, it was a bevy of activity: 
Sticky yellow with the bulkhead people, the phones in the area, 
and it was really a neat thing to see.
    But if you look at all the special teams working on the 
subject matter stuff, private sector folks wove it in. Salvage 
folks were over here, the waterways over there. Why? Because we 
had developed partnerships in the safety end of our business, 
in the environmental end of our business, in the security end 
of the business for years. And we build collaborating 
mechanisms, including planning for a crisis, and that served us 
extraordinarily well.
    I will give you an example. The salvage plan that we 
developed to clear the channels and so forth was done 
collaboratively with the salvers who have great insight and 
expertise. And we did that collaboratively. Within a day and a 
half we had a salvage plant that we floated up and got funded 
to get the ports open.
    So when we decided how we are going to manage this 
particular waterway with the aids down, we did it 
collaboratively with the users of the waterway.
    We put agreed upon restrictions. Maybe we said, ``Only 
daylight transit or one-way transit,'' or whatever we had to do 
to ensure safety, protection of the environment but yet get the 
commerce flowing. If you talked to the people in Florida, that 
east-west intercoastal waterway is very important to them, 
because all their petroleum products move along that waterway.
    So I was very impressed with the job of our district folks, 
Admiral Bob Duncan and all his folks in Louisiana, Mississippi, 
and the great, great partnerships. And I was down in 
Mississippi and the Gulf coast, up in Gulfport, walked into the 
county EOC there and the Coast Guard was embedded there two or 
three days before the incident, and there was constant 
communication between the local folks and out at EOC.
    So it is those partnerships, day-to-day partnerships that 
you have that you can build on and use in a crisis situation. 
And I think it worked very, very well to ensure the flow of the 
port and the waterway.
    Ms. Sanchez. Had you practiced that? I mean, had you done 
these drills where you were integrated?
    Admiral Collins. Yes, ma'am. We stuck to our knitting, the 
basics. We have a plan, we train and equip to the plan, we 
exercise the plan, and we implement the plan. And every one of 
our districts have disaster emergency plans and hurricane plans 
that they have drills on and exercise and have their partners 
included.
    Ms. Sanchez. Great.
    Thank you, Admiral.
    Thank you, Mr. Chairman.
    Mr. Lungren. Thank you.
    The gentleman from Indiana, Mr. Souder, is recognized for 5 
minutes.
    Mr. Souder. Thank you.
    What kind of short stick did you draw? Usually when the 
Coast Guard guys are retiring, you get Diamondhead or Old Point 
Loma. You get to come in front of the committees and defend the 
budget?
    [Laughter.]
    What kind of final tour is that?
    A couple of things. As you know, as narcotics chairman, I 
have very particular things, as much as I appreciate everything 
you do. I am a little concerned about this National Capital 
Region. I will insert my full statement in the record, and I 
hope you will respond to some of the written questions so we 
can fill out this whole record.
    But we are already taxed for air resources in the transit 
zones, and the Coast Guard has old--you did not get enough 
dollars really to add this and still do that. And I am very 
concerned about the weakening one mission in return for what is 
a thankless mission and that is, man, you have a mild screw-up 
here, you are going to have every committee down your throat.
    And so I am concerned this is going to be kind of an 
overreaction of the capital region and instead thousands of 
Americans may die because we have taken the helicopters out of 
the transit zone. Far more people are dying, 20,000 to 30,000, 
from illegal drugs, and we have had very few to none on our 
soil die of terrorism.
    And it is important that we work on the terrorism question, 
but narcotics are part of the terrorism, which then leads to 
the bigger question: How in the world in the budget here did 
drugs get moved out of the terrorism mission when we, when we 
drafted this agency, put it specifically that narcotics are 
part of the terrorism mission? And in my opinion, this budget 
request violates the organic nature of this act. Did you 
propose that or how did this get into the budget?
    Admiral Collins. Sir, it was sort of a budget accounting 
mechanism and also how it fits into the out-year budget. 
Obviously, the implication is the homeland security designation 
in terms of budget allowed budget growth over the 5-year plan 
more robust than if you are not in that category. I mean, so 
that is really the implication is in your budget.
    Clearly, this was an attempt, I think, to get us on the 
same, or my understanding is, budget accounting level as 
everyone else in the Department. Their budgets for drugs are 
not counted as ``homeland security mission.''
    So purely as a budget accounting mechanism, sir, but I do 
share your concern about what it will do to the glide path, if 
you will, budget glide path for the segment of our mission set 
going forward.
    Mr. Souder. Illegal immigration is listed under homeland 
security, which is far more complex than this homeland 
security, and you have other things listed under homeland 
security. Narcotics have at least the same nexus. Forget that 
narcoterrorism is terrorism and defined in your act not to be 
separated.
    But at the same time, that even the interlinks between the 
different groups that are moving people, that are moving drugs, 
that can move chemical and biological weapons, are 
increasingly, as we drive them underground, as we seal of their 
financial tactics, as we look at this, it is clear they are 
moving even more in that direction. This is an artificial 
distinction that is not real and is going to become even more 
dramatically wrong.
    In my opinion, Director Walter should be screaming at the 
top on this. We are having similar problems with the defense 
missions, as you know, from JATF. We have already seen because 
of improved intelligence, more drug loads that we are not 
seizing. We are seizing but we are seeing more, and we do not 
have enough to do that.
    And by separating this out, we compound the problem of not 
intercepting. Then local law enforcement is overwhelmed, and 
they are basically, at the end of the day, going to be the same 
groups. The drug runners, the trucks that are running the drugs 
are running other things too. They are smuggling people with 
them.
    I do not understand how--did OMB propose this, is that what 
you are saying? Is this something Director Chertoff said inside 
the Department? Who can move your numbers around in those 
charts? I mean, I do not think it is going to some kind of CPA 
at a lower level; it has got to be a policy decision.
    Admiral Collins. Yes, sir. I think this was a policy 
decision within the administration in terms of having this 
accounting framework. I am very sympathetic with some of the 
observations you have made about the linkages and so forth.
    So it really is sort of the budget folks wanting to have 
neat little categories. And also as you increase the non-
homeland security designated missions in terms of the budget 
category, there is more downward pressure on the out-year 
budgets.
    Mr. Souder. Yes. Quite frankly, we ca not have some--I have 
a business degree and an MBA and have taken many accounting 
things, did our payroll in our business and so on. You do not 
want a CPA make terrorism and drug policy in the United States 
because of the boxes where the stuff goes.
    Now, I have some specific questions to follow up on the 
capital region, on some of the Hetron helicopters. I very much 
appreciated visiting in Jacksonville and down at JATF as well 
as in northern California. The Coast Guard has been great in so 
many missions, and if you are not careful, we are going to give 
you the land border in the Southwest too.
    Admiral Collins. Sir, we would be very, very glad to give 
you a detailed brief, your staff, on the whole initiative for 
the National Capital Region. And I think in terms of the 
current baseline of effort, it is mission-neutral. And we will 
lay that why it is, how we are able to do that with the 
inventory of helicopters we have. And I think you will see very 
clearly that really, really minimal or no impact on the drug 
mission against the current baseline.
    Mr. Lungren. I thank the gentleman. I also sense that what 
the admiral is telling us is that while it has no impact this 
time, those categories that are called homeland security have a 
greater slope of increase in probably the out-years versus non-
homeland security. So if you take the drug mission out of it, 
it is probably going to be less dollars in the future.
    The gentleman from Mississippi is recognized for 5 minutes.
    Mr. Thompson. Thank you, Mr. Chairman.
    Admiral we talked a little bit about the Deepwater Program 
and the fact that the request this year is less than last year. 
And in light of Katrina and the fact that some of the areas of 
the country impacted by Katrina were damaged that goes 
specifically to the Deepwater, how are we going to make up for 
the shortfall?
    Admiral Collins. Well, it is approaching $1 billion, the 
request. If it is successful in Congress and it puts us on an 
equivalent level of last year--last year we got in the mid-90s, 
$900 million, although with 1 percent rescission it did take 
some money off the table--allow us to push ahead on the fourth 
national security cutter, and it does allow us to move ahead on 
the fast response cutter and a lot of the important aviation 
conversions, the conversions of existing platforms that we are 
doing. And it puts us on the 25-year plan that we submitted 
last summer.
    So it is fairly close to that plan that we submitted last 
summer in terms of the schedule.
    Mr. Thompson. So your testimony is that it has no 
significant impact on Deepwater, the cut that is being proposed 
in the budget.
    Admiral Collins. Really, we are not--I mean, we are even 
with last year, for all intents and purposes, in terms of the 
level, and it keeps us on pace with the bulk of that plan going 
forward. The big thing is it does provide for--and one 
adjustment too is we have had some progress on the maritime 
patrol aircraft. There was one added in, there were two added 
in on the congressional action last year. So that end of the 
program is moving ahead as well.
    Obviously, the issue is--I think the real question is, is 
25 years the right length of the program and what kind of 
challenges does a program that is 25 years long present to you? 
And can we wait 25 years to get all the necessary capability 
that we have in the plan over a 25-year timeframe? That is the 
issue de jour, and it is all about affordability and how it can 
fit in the budget.
    Mr. Thompson. Well, I am glad you brought that up. So if we 
give you $1 billion every year, we make 25 years. Do we have 
anything left at the end of 25 years, is my question, to fix 
it?
    Admiral Collins. What we have tried to do is carefully 
manage the legacy assets under this plan as well as introduce 
the new. So you will see the substantial investments. For 
instance, it is over, I think, if I recall right, $35 million 
or so out of that total request is being invested in what we 
call a Mission Effectiveness Program, which is a shipyard 
availability on steroids. It is a long shipyard availability 
program. We pull the crew off and we change the major 
subsystems on the ship--the heating and air conditioning, the 
sewage system and so forth?so we can keep those ships going 
until they are ultimately replaced.
    So the big change, because of the 25-year plan, has been a 
more robust allocation to the legacy assets so we can keep them 
alive until they are changed. So we have had to do that kind of 
tap dance between the legacy systems.
    Mr. Thompson. But is keeping them alive, Admiral, the 
highest and best use of our money or are we using baling wire 
and bubble gum and other things to keep them afloat? And I am 
just saying that if the budget request is not as realistic as 
it needs to be, then some of us are just looking for somebody 
to say, ``Look, if you gave us more money, we could do it in a 
shorter period of time. From a cost-benefit ratio, we could 
save taxpayers money over the long run.''
    Admiral Collins. Well, of course, we at the--I think it was 
the very first report that came of the Department of Homeland 
Security after it was formed, a report to Congress, was on 
Deepwater, and it was a response to a requirement by Congress 
that asked for, could you accelerate Deepwater? Is it possible? 
Did we have the shipyard capacity? The answer is absolutely 
yes. And what kind of benefits would accrue? That report came 
up and it said, ``Yes, you could accelerate. Here is the 
distinct advantages of accelerating.
    What it comes down to is, again, an affordability issue and 
a pacing issue of what can we fit into the envelope. And that 
is a decision, of course, much above my pay grade on those 
issues.
    Mr. Thompson. But if more money showed up in the envelope, 
we could get it done in a shorter period of time.
    Admiral Collins. Absolutely, sir. And we would get the 
capability and the performance enhancements much earlier.
    Mr. Thompson. Thank you.
    Mr. Lungren. And we might be alive to see it.
    [Laughter.]
    Mr. Thompson. In our life?
    Mr. Lungren. In our life? Well, that is usually what I say 
when I am alive, my lifetime.
    The gentleman from Washington, the always pensive, Mr. 
Dicks.
    [Laughter.]
    Mr. Dicks. Thank you, Mr. Chairman.
    Commandant Collins, you have done a great job and I 
appreciate the good work you have done out in the Pacific 
Northwest. And you and I had a chance before the meeting to 
discuss the situation on the heli.
    I am not going to get into that in much detail, but I just 
would reiterate my view that this is a mistake, that this ship 
should remain home ported in Seattle, Washington, not in my 
district. But we have invested money there in a new pier. If we 
do not do this and it is moved to Alaska, it will wind up 
having some of the Coast Guardsmen crew away from home for 300 
days a year. It is bad for the crews, it is bad for the Coast 
Guard.
    And I know that this is sensitive because it involves some 
very senior members of the Congress, but this is a waste of 
taxpayers' money. I mean, this is going to be $8 million every 
single year, and the cost of building a new facility up in 
Alaska, at Kodiak, a new pier. So I just do not know why some 
people want to do these kind of things when it is just bad 
policy.
    And I know you have done what you can do and this is up to 
the Congress to resolve, and I just want to say I appreciate 
your good service over your 38-year career, and I am a big 
supporter of Deepwater, and we are going to continue to work, 
Senator Murray and I, in our state to be supportive of the 
Coast Guard.
    I enjoy going up to Port Angeles in particular and go out 
on the new safeboat and some of the patrol missions and see how 
the Coast Guardsmen do their good work.
    So, again, I appreciate your efforts and hope that you get 
through this next few months.
    Thank you, Mr. Chairman.
    Admiral Collins. Thank you, sir.
    Mr. Lungren. Thank you for the comments.
    Before I recognize Ms. Jackson-Lee, I should mention that 
we are going to go back in in about 2 minutes and there will be 
2 votes--one a 15-minute vote, one a 5-minute vote--so I would 
hope that would could finish this round of questions for the 
two remaining members so that maybe we could allow the admiral 
to leave.
    With that, I would recognize the gentlelady for 5 minutes.
    Ms. Jackson-Lee. Thank you, Mr. Chairman. I am very pleased 
that the chairman and ranking member, that we are holding this 
budget hearing.
    And let me say, Admiral, I am not sure if you read verbatim 
your statement but allow me to just briefly say that in your 
words, ``No one can predict the timing of the next catastrophe 
event akin to Katrina or whether it will be natural or manmade. 
Nonetheless, history tells us it will come. When it does, it 
will be vital that we have done all we can to build a Coast 
Guard that is prepared to answer the call, supremely aware of 
the maritime environment and poised for a dependable 
response.''
    Let me echo your words and applaud and thank you for the 
heroic, powerful efforts that were made by the Coast Guard. I 
know the Coast Guard is equal to people. To the young men and 
women who risked their lives saving people from roofs and oily, 
dirty water. Let me pronounce to you our enormous debt.
    I come from the Gulf region, I have been in hurricanes and 
floods, and so let me thank you very much for that.
    I have two very brief questions and in addition two 
statements just to put on the record briefly. And that is that 
as generous as you have been with your kindness, I do not find 
any comfort in a $32 million cut in Deepwater regardless of 
your stoic response, and I find no comfort in the fact that 
your budget has been frozen. And I, frankly, Mr. Chairman and 
Ranking Member, I think we need to be in the fight on this 
issue.
    And, as well, let me just simply do as I will continue to 
do throughout this timeframe is to ask the chairman and ranking 
member but as well this is conveyed generally for the 
committee, that the work of Katrina task force appointed by the 
Speaker has ended. It is now time for a responsible oversight 
committee, such as Homeland Security to have before it, in 
addition to yourself, Admiral, not on the budget but on the 
issue of Katrina, Secretary Chertoff, the acting director of 
FEMA, and it is time for us to do our oversight, and it is time 
for us to do it now. I will continue to raise this point 
consistently.
    Admiral how fast could you do the constructing the fourth 
national security cutter and acquiring the sixth maritime 
patrol aircraft with additional money? What is the timeframe 
for that now? Am I to see that in 2007 or what?
    Admiral Collins. The first national security cutter is 
under construction right now; 50 percent done; delivered in 
late 2007. It will go through an operational evaluation and so 
forth. So that is sort of the timeline of the first. And then--
    Ms. Jackson-Lee. And you have the money to make sure you 
stay on time?
    Admiral Collins. That is under discussion. There is a 
request for equitable adjustment by Northrop Grumman, the 
manufacturer, producer of that ship, that is being adjudicated 
right now. It has not been definitized, and there may be some 
cost impact.
    Ms. Jackson-Lee. All right. With that in mind, that is 
another fight we need to be into. This budget cut is impacting 
us negatively.
    Secondarily, the sixth maritime patrol aircraft, what is 
the status of that?
    Admiral Collins. Of course, that is in our budget, the 2007 
budget. That will give us a total of six of those new planes 
that allow us to implement two air stations. We need three in 
each air station to have a set. And the associated sparing and 
so forth. So with the 2007 budget, we have two complete air 
stations that will be implemented.
    Ms. Jackson-Lee. But you will be able to get it under this 
budget that we are putting forward here?
    Admiral Collins. Yes.
    Ms. Jackson-Lee. Lastly, I represent partly in the area of 
the Houston Port, and port security is key and the Coast Guard 
is certainly engaged in our port security. What is the impact 
on your cuts as it relates to being able to be engaged in ports 
around America, particularly the largest ports like Houston, 
Texas?
    Admiral Collins. We are full up at Houston, ma'am. That is 
a very, very important port. We are very active in Houston-
Galveston, and we anticipate no cuts in terms of our operations 
in Houston-Galveston.
    Ms. Jackson-Lee. Lastly, I want to invite you down, 
Admiral, and we will engage on that point.
    Thank you very much. Yield back.
    Mr. Lungren. Thank the gentlelady.
    There has been a call for votes. We have 2 votes, one 15-
minute, one 5-minute, but I would hope that we could finish 
before we leave.
    And so I would recognize the gentleman, Mr. Langevin, for 
the next 5 minutes.
    Mr. Langevin. Thank you, Mr. Chairman. I will try to be as 
brief as possible.
    Admiral I want to thank you very much for being here, and 
for your testimony. I have had the opportunity to review it, 
and let me just ask you this: in your testimony, you mentioned 
that the president requested $17 million for maritime domain 
awareness operating expenses, plus an additional $62 million 
for acquisition, construction and improvement. And I am 
certainly excited about the prospect of a fully integrated MDA 
system that will alert us to all ships within range of our 
shores, as I am sure you are as well.
    I hear that a renegotiated NORAD agreement with Canada, 
which could include a binational maritime domain awareness 
component, is under discussion. Is the Coast Guard 
participating in those discussions, and what role will the 
Coast Guard have in that effort?
    Additionally, who would be charged with monitoring the 
maritime domain, and would in fact the Coast Guard be the 
primary agency to respond to perceived threats?
    Admiral Collins. Great question, sir. We have, of course, a 
Maritime Domain Awareness Program Office that is a joint office 
between the Navy and us. The MDA plans is a subset of the 
National Maritime Security Strategy that was just signed by the 
president last September.
    There is an MDA plan associated with that and an 
implementation team that is working--interagency implementation 
team right now that is defining all the answers to the 
questions that you asked: What is the architecture, what is the 
system, what is the process change, the policy change, the 
authority change and the architecture to in fact build out 
competencies for maritime domain awareness? So that is playing 
out as we speak.
    NORTHCOM is involved in that, NORTHCOM, NORAD. We also 
obviously had a robust dialogue with the Canadians on a lot of 
this as well.
    So that team is looking at the architecture, looking at a 
technology plan, looking at an investment plan and looking at 
the respective jurisdictions and how we are going to put this 
together. And we are locking them in a room, putting pizzas 
under the door, and they are working hard to develop that game 
plan.
    I think one of the most important things we can do is 
clearly to get transparency of people, cargo and vessels in the 
maritime allows us to intervene well before an incident happen. 
And it is good for drugs, it is good for migrants, it is good 
for counterterrorism. Having good MDA, that is good 
intelligence, good senses in tracking, good information fusion, 
good command and control systems is the heart and soul of good 
performance. So it is a very, very important effort.
    Mr. Langevin. And you are confident in the Coast Guard's 
role being front and center?
    Admiral Collins. We are going to have a very robust role in 
that along with the United States Navy. We are joined at the 
hip with the United States Navy in all regards for maritime 
domain awareness.
    For example, for an intelligence function component of 
that, we are co-located at Suitland, Maryland, with ONI. Their 
headquarters, our headquarters. We are vetting all information 
intelligence together, collaboratively, and so it is a very, 
very close, close partnership with them.
    Mr. Langevin. And the last part of my question is, would 
the Coast Guard still be the primary agency to respond to 
perceived threats?
    Admiral Collins. We will be one of the primary. How exactly 
that is divided up is still to be determined as part of the 
architecture.
    Mr. Langevin. I think I will end there. I will have some 
other questions for the record.
    But, Admiral, thank you very much for your testimony. Thank 
you and the entire Coast Guard for the great job you are doing.
    Admiral Collins. Thank you, sir.
    Mr. Lungren. There are still 10 minutes left before the 
vote is over if any other members have further questions.
    Admiral I want to thank you for your testimony. I have a 
few written questions, as do some of the other members, as they 
have suggested. We will submit them to you, and we hope that 
you could respond to these in writing. The hearing record will 
be held open for 10 days.
    And, again, I would join with my colleagues in thanking you 
for your service and recognizing that your retirement date is 
not precisely on us but it is on the horizon. And we appreciate 
the work that you have done.
    You have led the Coast Guard through a very difficult time, 
and you have shown us how government ought to work and can work 
under extreme circumstances, and we appreciate that. As we 
spend a lot of time pointing out the problems, it is nice to 
point out where something has worked and worked well.
    And also you have built a record of accomplishment that 
will justify the requests for the asset modernization program 
that you have led and that I think you see how these members 
feel about that.
    So I thank you for that, and without objection, the 
subcommittee stands adjourned.
    Admiral Collins. Thank you, Mr. Chairman.
    [Whereupon, at 5:55 p.m., the subcommittee was adjourned.]

                             For the Record

    Questions from Mr. Lungren for Admiral Thomas Collins Responses

Deepwater:

Question: The National Security Cutter (NSC) is currently scheduled to 
be delivered in August of 2007. Is it currently on time and on budget?
    Response: As of March 2006, the National Security Cutter (NSC) is 
approximately 40% complete. When the production contract was awarded in 
June 2004, a delivery date of May 2007 was established. Preliminary 
feedback regarding the impact of Hurricane Katrina indicates that 
approximately 4 additional months will be needed, changing delivery 
date from May 2007 to September 2007.
    The projected cost of NSC #1 was $391.6 million for full post-9/11 
capability. Overall the NSC has not experienced significant cost 
changes between the budget estimates provided in July 2005 and the 
budgeted estimates provided in the fiscal year 2007 President's Budget 
Request.
    The Coast Guard has identified the following additional major cost 
drivers that have not yet been fully quantified:
 Hurricane Katrina: The Coast Guard received $20.2 million in 
supplemental appropriations for damage related to hurricane Katinra. 
The purpose of this funding is detailed below:

 
 
 
 
Main control system                            $4.0
Cable assemblies & connectors                   2.2
Joiner equipment                                1.8
Powered operated valves                         1.4
Ship service generator                          1.2
Exhaust plume cooling system                    1.15
Auxiliary piping                                1.0
Steel                                           0.8
Heating, ventilation, air conditioning          0.6
 ducting
Switchboards                                    0.6
Air Conditioning equipment                      0.5
Prime mover exhaust ducting                     0.45
TACAN antennae                                  0.375
Hangers, hydraulic systems, control valves      0.36
------------------------------------------------------------------------
Equipment and Material Cost                     16.435
 
Additional Labor for rework                     3.8
------------------------------------------------------------------------
Total                                           $20.235
 

    This cost estimate does not include any facilities, rolling stock 
or capital equipment that would remain at the shipyard after NSC #1 was 
accepted by the Coast Guard. Likewise, none of this estimated amount is 
related to any payment of Federal funds that would be the 
responsibility of Integrated Coast Guard Systems/ Northrop Grumman Ship 
Systems or their insurers.
     Request for Equitable Adjustment (REA) for NSC#1 is 
pending. The Coast Guard is in the process of determining if the 
budgeted amounts are sufficient for the REA or if additional funds 
above the current estimate will be required.
     Economic Price Adjustment (EPA) for ship production 
exceeds inflation amounts above the allowed OMB amounts of 1.85 
percent. It is anticipated that an annual cost increase of 3-4 percent 
will be realized through EPA.
    The Coast Guard is working with the Administration and will advise 
Congress as soon as further revisions to the cost estimates become 
available.

    Question: How will the NSC provide improved homeland security 
capabilities over the High Endurance Cutters currently employed?
    Response: The National Security Cutter (NSC) will have inherent 
capabilities that are a vast improvement over legacy 378' High 
Endurance Cutters. The NSC will conduct proactive and reactive patrols 
within its assigned operating areas, and will provide a robust Command 
and Control capability for duties as Commander, Task Unit and On-Scene 
Commander. These improved capabilities include the ability to:
         Engage and defeat terrorists and ensure survivability 
        from Chemical, Biological and Radiological threats in 
        contaminated environments for up to 36 hours.
         Carry and deploy multiple airframes, such as: 1 
        helicopter and 2 VUAVs, or 2 helicopters, or 4 VUAVs or any 
        DHS/DoD helicopters up to an including HH-60 variants.
         Carry and deploy multiple Over-the-Horizon (OTH) 
        cutter boats.
         Conduct boat and flight operations in higher sea 
        states due to improved sea keeping capability.
         Support the full range of Coast Guard missions and 
        Coast Guard intelligence element operations through greatly 
        improved intelligence gathering and C4ISR capabilities. These 
        intelligence and C4ISR capabilities also enhance the NSC/WMSL's 
        self-defense capabilities and facilitate operations with 
        networked DHS, DOD, and national assets.
         Operate of 230 days/year compared to 185 days/year for 
        the legacy 378? High Endurance Cutter (WHEC).
         Operate with US Navy Battle Groups with a maximum 
        sustained speed of 28 knots.
         Have a NSC patrol an area of 56,000 square miles a day 
        with its combined force package of cutter/helicopter and two 
        VUAVs, vs only 13,500 square miles a day with the current WHEC 
        378/one helicopter package.

    Question: Can you explain why the Coast Guard has decided to 
expedite its schedule for the Fast Response Cutter (FRC) and what are 
the advantages of doing so.
    Response: Increased post 9/11 operational tempo is causing the 
continued deterioration of the 110-ft patrol boat hulls and increased 
technical difficulties associated with the 123-ft conversions have 
necessitated the urgency to acquire the FRC earlier. Expediting the 
delivery of the FRC is in direct response to the current patrol boat 
shortfall in mission hours created by these technical challenges and 
homeland security operational responsibilities.
    With 58 FRCs planned, there will be more FRCs in the Deepwater 
system than any other single asset. The FRC is projected to be the 
workhorse of the fleet with 3,000 annual mission hours per FRC. The 
total system impact of these one hundred seventy four thousand (174K) 
hours is critical for the Coast Guard to meet its homeland security 
operational responsibilities.

    Question: Will the Coast Guard replace the FRCs on a one to one 
ratio with their current patrol boat fleet?
    Response: No, it is not a one to one replacement with the current 
patrol boat fleet. The current Deepwater plan replaces the forty nine 
(49) 110' and 123' patrol boats with fifty-eight (58) FRCs. While the 
final Deepwater plan has more patrol boats, it has less major cutters. 
The plan relies on more capable patrol boats taking over some of the 
missions major cutters now perform.

    Question: Will your Deepwater budget address shoreside 
infrastructure, such as longer piers or additional storage?
    Response: Yes. Shoreside infrastructure is funded each year within 
the budget line for the Integrated Logistics Support Domain of 
Deepwater. For fiscal year 2007, $24.4 million in funding has been 
requested to:
         Upgrade pier/shore ties in Panama City, FL.
         Upgrade pier/shore ties and Fenders in Miami, FL.
         Upgrade pier/shore ties and Fenders in San Juan, PR.
         Upgrade pier/shore ties in Kodiak, AK.
         Construction of the National Security Cutter Support 
        building in Alameda, CA.
         Facility upgrades for C4ISR equipment installations in 
        CA.
         Completion of Phase 1 of the NSC related C4ISR 
        Training building at Coast Guard Training Center in Petaluma, 
        CA.
         Construction of the Simulator Training Building at 
        Coast Guard Aviation Training Center in Mobile, AL for the CASA 
        MPA (CG-235).

    Question: Deepwater funds will test one ship control station (SCS) 
and one ground control station (GCS) for the Vertical Takeoff-and-
Landing Unmanned Aerial Vehicle (VUAV). How far along is the VUAV 
development?
    Response: The VUAV system component production and subassembly 
phase is complete, and the project is now advanced to the system design 
and demonstration phase. The next project phase will be system assembly 
and demonstration, which will result in VUAV first flight and testing 
of two ground control stations. It should be noted that Bell Helicopter 
Textron, the subcontractor to ICGS, has funded development of their own 
VUAV program. Bell's VUAV, the same as the Deepwater model, was 
successfully flown for the first time in January 2006.

    Question: Has the VUAV designed by Integrated Coast Guard Systems 
(ICGS) been successful tested?
    Response: No, the Deepwater Vertical Takeoff-and-Landing Unmanned 
Aerial Vehicle (VUAV) has not yet been tested. The next phase of the 
project is system assembly and demonstration, which will result in VUAV 
first flight and testing of the two ground control stations.

    Question: What is the status of the Research and Design phase?
    Response: The concept and technology development phase of the 
Vertical Takeoff-and-Landing Unmanned Aerial Vehicle (VUAV) project is 
complete. The project is now in the system design and development 
phase.

    Question: How do you plan on working with the Federal Aviation 
Administration to address flight restrictions and operation of VUAVs in 
U.S. airspace?
    Response: The Coast Guard and Integrated Coast Guard Systems (ICGS) 
are working closely with the Federal Aviation Administration (FAA) to 
develop airworthiness standards and operator qualifications for the 
Vertical Takeoff-and-Landing Unmanned Aerial Vehicle (VUAV) known as 
the Eagle Eye. Most of the Eagle Eye operations will be in airspace 
outside of FAA jurisdiction. Nonetheless, all applicable FAA standards 
will be met by Eagle Eye.

    Question: What role did Deepwater assets play in the Coast Guard's 
response to Hurricane Katrina?
    Response: The re-engined HH-65C helicopters upgraded by the 
Deepwater project and Legacy cutters with Deepwater C4ISR upgrades were 
used to respond to Hurricane Katrina. On average, HH-65C helicopters 
were able to pick up 500 lbs more payload (3-4 additional people, 
depending upon the mix of adults/children) than their HH-65B 
counterparts. Additionally, the HH-65Cs were able to take off with more 
fuel than the HH-65Bs. This extended sortie lengths for the HH-65Cs by 
42 to 48 minutes. Legacy cutters with Deepwater C4ISR upgrades 
immediately entered the Port of New Orleans and established an on-site 
federal communications site for command and control. These cutters were 
able to quickly sort out merchant vessel traffic movements using AIS 
and took advantage of enhanced communications with DoD assets.

    Question: What damages were experienced at Coast Guard facilities 
and to Coast Guard assets in Hurricane Katrina?
    Response: The following table lists the damages to Coast Guard 
facilities and Coast Guard assets as a result of Hurricane Katrina.

------------------------------------------------------------------------
                                                        Description of
        Unit and location                Storm              Damages
------------------------------------------------------------------------
USCG Fire & Safety Detachment,    Katrina             Research Vessel
 Mobile, AL                                            State of Maine,
                                                       moved from
                                                       permanent
                                                       mooring,
                                                       substantial
                                                       dredging
                                                       required. Severe
                                                       damage to pier,
                                                       landing craft,
                                                       test facility,
                                                       utility building
                                                       and other
                                                       miscellaneous
                                                       infrastructure.
------------------------------------------------------------------------
Environmental Compliance &        Katrina             Pump & recycle
 Restoration Fund                                      diesel & gasoline
                                                       and perform
                                                       environmental
                                                       damage assessment
                                                       at affected shore
                                                       facilities. Costs
                                                       primarily at Base
                                                       Mobile.
------------------------------------------------------------------------
Integrated Support Command (ISC)  Katrina             Damages incurred
 Miami                                                 as Hurricane
                                                       Katrina passed
                                                       through Florida
                                                       include
                                                       unaccompanied
                                                       personnel housing
                                                       facility water
                                                       damage,
                                                       administrative
                                                       building water
                                                       damage, blast
                                                       booth building
                                                       water damage,
                                                       Station Miami
                                                       Beach water
                                                       damage.
------------------------------------------------------------------------
Air Station Miami, FL             Katrina             Twenty percent of
                                                       fixed wing hanger
                                                       roof blown off as
                                                       Hurricane Katrina
                                                       passed through
                                                       Florida.
------------------------------------------------------------------------
Station Fort Lauderdale, FL       Katrina             Damages incurred
                                                       as Hurricane
                                                       Katrina passed
                                                       through Florida
                                                       include
                                                       engineering
                                                       building roof
                                                       damage, and
                                                       unaccompanied
                                                       personnel housing
                                                       water damage.
------------------------------------------------------------------------
Sector Key West, FL               Katrina             Incurred
                                                       miscellaneous
                                                       exterior damage
                                                       as Hurricane
                                                       Katrina passed
                                                       through Florida.
------------------------------------------------------------------------
Station Destin, FL                Katrina             Minor storm
                                                       damage.
------------------------------------------------------------------------
Station Panama City, FL           Katrina             Minor storm
                                                       damage.
------------------------------------------------------------------------
Station Pensacola, FL             Katrina             Roof damage.
------------------------------------------------------------------------
Aviation Training Center (ATC)    Katrina             Hangar roof and
 Mobile                                                Gulf Strike Team
                                                       roof severely
                                                       damaged;
                                                       communications
                                                       spaces damaged.
------------------------------------------------------------------------
Base Mobile AL                    Katrina             Extensive wind and
                                                       flooding damage
                                                       to entire
                                                       facility. All
                                                       storage and
                                                       HAZMAT buildings
                                                       destroyed. Fuel
                                                       farm jammed with
                                                       debris.
------------------------------------------------------------------------
Station Dauphin Island, AL        Katrina             One of two piers
                                                       damaged, but both
                                                       are useable.
                                                       Severe flood and
                                                       wind damage.
------------------------------------------------------------------------
Station Pascagoula, MS            Katrina             Major wind and
                                                       flooding damage
                                                       to DECISIVE
                                                       Storage Area,
                                                       DECISIVE shore
                                                       tie, MAT
                                                       building, Station
                                                       building
                                                       (interior and
                                                       exterior). All
                                                       electrical
                                                       systems to and
                                                       from pier
                                                       damaged. Units at
                                                       this location
                                                       include Station
                                                       Pascagoula, MAT/
                                                       ESDD Pascagoula,
                                                       CCG DECISIVE, CGC
                                                       SHAMAL & CGC
                                                       TORNADO.
------------------------------------------------------------------------
Station Gulfport, MS              Katrina             The entire station
                                                       was completely
                                                       destroyed by the
                                                       storm surge. .
                                                       .nothing
                                                       functional
                                                       remains. Estimate
                                                       of required
                                                       repairs:
                                                       replacement of
                                                       all station
                                                       buildings
                                                       including garages/
                                                       storage
                                                       facilities/HAZMAT
                                                       & HAZWASTE
                                                       buildings/guard
                                                       shacks/boat
                                                       houses;
                                                       replacement of
                                                       all pier
                                                       facilities/
                                                       utilities;
                                                       removal of all
                                                       storm debris;
                                                       clean-up of
                                                       spilled HAZWASTE;
                                                       installation of
                                                       security fences/
                                                       equipment/
                                                       external
                                                       lighting; repairs/
                                                       shoring-up of
                                                       eroded
                                                       shorelines; &
                                                       significant
                                                       dredging to
                                                       entire basin
                                                       required.
------------------------------------------------------------------------
87' CPB Equipment Storage,        Katrina             Two 87' CPBs
 Gulfport, MS                                          maintenance
                                                       storage
                                                       facilities
                                                       destroyed, all
                                                       spare parts and
                                                       outfitting were
                                                       lost.
------------------------------------------------------------------------
Air Station New Orleans, LA       Katrina             Severe wind damage
                                                       to facility. Fuel
                                                       system out of
                                                       commission. North
                                                       side of hangar
                                                       lean-to roof 50
                                                       percent
                                                       destroyed. All
                                                       spaces under lean-
                                                       to damaged.
------------------------------------------------------------------------
Station Grand Isle, LA            Katrina             Unit was heavily
                                                       damaged by storm
                                                       surge and wind
                                                       damage. First
                                                       floor sustained
                                                       flood damage and
                                                       second floor is
                                                       saturated. 40% of
                                                       roof is down to
                                                       concrete deck. 26
                                                       housing units
                                                       extensively
                                                       damaged.
------------------------------------------------------------------------
Station Venice, LA                Katrina             90% of roof
                                                       intact, with
                                                       flood damage to
                                                       first floor. 2nd
                                                       floor dry,
                                                       berthing and
                                                       messing areas in
                                                       good order. Boat
                                                       house, mooring,
                                                       pier and 87
                                                       moorings intact.
                                                       Fuel tanks are in
                                                       place, but fuel
                                                       is contaminated.
------------------------------------------------------------------------
Integrated Support Command (ISC)  Katrina             Suffered extensive
 New Orleans (NOLA)                                    roof damage and
                                                       severe flooding
                                                       that renders the
                                                       facility useless.
                                                       ISC NOLA may not
                                                       be able to return
                                                       to its former
                                                       location. The
                                                       site is heavily
                                                       damaged and maybe
                                                       beyond economic
                                                       repair. Over the
                                                       past two years,
                                                       planning
                                                       proposals have
                                                       been submitted
                                                       recommending that
                                                       the ISC relocate
                                                       to NASA Michoud
                                                       due to an Army
                                                       Corps of
                                                       Engineers project
                                                       to enlarge the
                                                       Industrial Canal
                                                       adjacent to the
                                                       ISC.
------------------------------------------------------------------------
Sector New Orleans, LA            Katrina             Sector bldg roof
                                                       damaged & ground
                                                       level flooded.
                                                       Office trailers
                                                       flooded. Small
                                                       boat shops &
                                                       storage flooded.
                                                       Temp storage bldg
                                                       flooded &
                                                       dislodged from
                                                       foundation. Main
                                                       building looted.
                                                       Other leased
                                                       spaces received
                                                       damage. Rebuilt
                                                       Sector Command
                                                       Center (SCC) to
                                                       be outfitted with
                                                       capabilities
                                                       necessary to
                                                       restore full CG
                                                       operational
                                                       effectiveness in
                                                       New Orleans.
------------------------------------------------------------------------
Regional Examination Center       Katrina             Office has been
 (REC) New Orleans, LA                                 displaced due to
                                                       flooding.
------------------------------------------------------------------------
Recruiting Office New Orleans,    Katrina             Leased facility,
 LA                                                    but damaged
                                                       property/office
                                                       equipment/records
                                                       and two vehicles
                                                       were damaged.
------------------------------------------------------------------------
Vessel Traffic Service New        Katrina             Equipment and
 Orleans, LA                                           infrastructure
                                                       severely damaged.
------------------------------------------------------------------------
Communications Station (COMMSTA)  Katrina             Severe wind and
 New Orleans, LA                                       flooding damage.
------------------------------------------------------------------------
District Eight Representational   Katrina             Replace damaged
 Facility New Orleans, LA                              siding, minor
                                                       roof repairs,
                                                       interior repairs
                                                       from water
                                                       intrusion, and
                                                       exterior clean up/
                                                       debris removal.
------------------------------------------------------------------------
DGPS Sites                        Katrina             Following DGPS
                                                       sites were
                                                       damaged: Bobo,
                                                       MS; Vicksburg,
                                                       MS; English Turn,
                                                       LA; Mobile Point,
                                                       AL
------------------------------------------------------------------------
District Seven Aids to            Katrina             Many ATON assets
 Navigation                                            destroyed or lost
                                                       in Hurricane
                                                       Katrina's initial
                                                       landfall in South
                                                       Florida.
------------------------------------------------------------------------
District Eight Aids to            Katrina             Many D8 ATON
 Navigation (AtoN)                                     assets destroyed
                                                       or lost in
                                                       Hurricane
                                                       Katrina.
                                                       Replacement
                                                       includes
                                                       replacing
                                                       destroyed high
                                                       priority range
                                                       towers and
                                                       lights; ocean
                                                       buoys (with chain
                                                       & bridles); river
                                                       buoys (including
                                                       moorings), day
                                                       markers, ranges,
                                                       automated light
                                                       structures, etc.
                                                       Required to open
                                                       all navigable
                                                       waters to
                                                       commercial
                                                       traffic,
                                                       including: Lower
                                                       Mississippi
                                                       River, Western
                                                       Rivers,
                                                       Intercoastal
                                                       Waterway,
                                                       approaches to
                                                       Mobile,
                                                       Pascagoula, and
                                                       Biloxi.
------------------------------------------------------------------------
Reconstitution of Distress        Katrina             Following NDRS
 Communications (OE)                                   sites sustained
                                                       various levels of
                                                       damage:
                                                       Greenville, MS;
                                                       Vicksburg, MS;
                                                       Marksville, LA;
                                                       Plaquemines, LA;
                                                       Pecan Island, LA;
                                                       Grand Chenier,
                                                       LA; South Bend,
                                                       LA; Leeville, LA;
                                                       Venice, LA;
                                                       Gretna, LA; Van
                                                       Cleave, LA;
                                                       Pascagoula, MS;
                                                       Weeks Bay, AL;
                                                       Fort Walton, FL.
------------------------------------------------------------------------
Coast Guard Property              Katrina             General property
                                                       (GP), non SWS III
                                                       & non vehicle,
                                                       greater than
                                                       $2,500 value from
                                                       affected Coast
                                                       Guard Units
                                                       commensurate with
                                                       the level of
                                                       damage
------------------------------------------------------------------------
Small Boat Operations and         Rita                Coast Guard boats
 Damages                                               provided SAR,
                                                       ATON, and marine
                                                       environmental
                                                       protection
                                                       assistance and
                                                       several have been
                                                       severely damaged
                                                       from the storm.
                                                       Also extensive
                                                       (near continuous)
                                                       use of CG small
                                                       boat fleet
                                                       responding to
                                                       multi-mission
                                                       hurricane relief
                                                       has resulted in
                                                       numerous outboard
                                                       engine
                                                       replacements and
                                                       overhauls, and
                                                       increased unit
                                                       and intermediate
                                                       level maintenance
                                                       requirements due
                                                       to high operation
                                                       hours; costs do
                                                       not fall under
                                                       FEMA mission
                                                       assignments.
------------------------------------------------------------------------
Katrina impact to Coastal Patrol  Katrina             Additional
 Boat Program                                          delivery costs
                                                       associated with
                                                       CPB project and
                                                       impact to support
                                                       personnel. The
                                                       87' CPB project
                                                       has had cost
                                                       growth since the
                                                       shipping of the
                                                       USCGC AHI. The
                                                       cost growth is
                                                       solely
                                                       attributable to
                                                       the market
                                                       conditions in the
                                                       Gulf Coast.
                                                       Bollinger
                                                       Shipyards had
                                                       extreme
                                                       difficulty
                                                       securing an ocean
                                                       going tug, barge
                                                       and crane to load
                                                       and transport the
                                                       USCGC AHI from
                                                       Lockport, LA to
                                                       Honolulu, HI.
------------------------------------------------------------------------
Katrina impact to Deepwater       Katrina             Damages to NSC1
 Program                                               and NSC2, FRC &
                                                       OPC material,
                                                       equipment and
                                                       facilities and
                                                       123' schedule
                                                       delays. Costs to
                                                       specific damages
                                                       to the NSC
                                                       production line
                                                       were covered in
                                                       the 3rd Supp. The
                                                       contractor
                                                       recently briefed
                                                       the Coast Guard
                                                       on expected cost
                                                       increases on the
                                                       Cost Plus
                                                       contract (first
                                                       ship), as well as
                                                       modifications to
                                                       the fixed price
                                                       contract for the
                                                       subsequent
                                                       cutters.
------------------------------------------------------------------------

    Question: How has Hurricane Katrina affected Coast Guard current 
operations on the Gulf Coast?
    Response: Coast Guard Eighth District commands along the Gulf Coast 
quickly returned to operations following Hurricane Katrina and are 
meeting mission requirements with some exceptions. Operational tempo 
for Eighth District units remains above normal due to storm related 
impacts. Several of our operational units were severely damaged by the 
high winds and storm surge and must be repaired or relocated. Workloads 
at many units have increased 15 to 25 percent due to extensive marine 
debris and an increase in marine casualties. Unit workloads also remain 
high due to ongoing FEMA mission assignment work regarding pollution 
response operations. Adequate housing in the impacted areas remains in 
short supply, with 20 percent of personnel working from temporary 
trailers, and up to 25 percent of personnel having lived out of a 
hotel. Many normally contracted functions including security, 
maintenance and support, are being performed by unit personnel due to a 
lack of contract businesses.

    Question: How has the Katrina supplemental funding been spent and 
what additional funds are needed for Katrina-related damages?
    Response: The enacted Coast Guard Hurricane supplemental funding 
($132 million for Operating Expenses and $74.5 million for Acquisition 
Construction & Improvement) has been expended/obligated on the damages 
and costs that were included in the justification provided with the 
Third Katrina Supplemental. These costs include major and minor repairs 
of damaged facilities, temporary logistics, Coast Guard Reservists, 
replacement of Aids to Navigation, damaged and destroyed small boats, 
and the overall re-capitalization and initial construction phases at 
Coast Guard facilities throughout the Gulf region, with the exception 
of Integrated Support Command New Orleans, for which only survey and 
design funding was provided.
    The $69.5 million in the Fourth Katrina Supplemental request is 
broken down as follows:
    Operating Expenses ($7.3 million): The funding will enable Coast 
Guard Reservists currently serving in relief and supporting roles of 
Hurricane Katrina in Louisiana, Mississippi and Alabama to serve beyond 
March 31, 2006, until the end of the fiscal year. This funding will 
support up to 200 reservists for the period of April through September 
2006.
    Acquisition Construction & Improvement ($62.2 million): This amount 
is to partially fund the relocation and reconstruction of Integrated 
Support Command (ISC) New Orleans, severely damaged by Hurricane 
Katrina and its associated flooding. Initial funding of $9.8 million 
(provided in the Third Katrina Supplemental) has initiated the 
reconstruction process by providing for survey and design. The funding 
requested will allow the Coast Guard to continue to actively pursue 
construction of the ISC New Orleans at the NASA facility at Michoud, 
LA, as well as relocation of salvaged equipment from the current ISC 
New Orleans site.

    Question: Does the Fiscal Year (FY) 2007 budget account for any of 
the damages suffered to Coast Guard assets or to construction of 
Deepwater assets in Pascagoula, Mississippi?
    Response: No. Funding for damages is being addressed through the 
supplemental funding request process. To date, the Coast Guard has 
received $20.2 million in supplemental funding to pay for damages to 
Deepwater projects.

    Question: What are the challenges the Coast Guard is facing with 
the labor force in the Gulf region and how will these challenges affect 
timing and cost of Deepwater deliverables?
    Response: The primary impact on Deepwater program asset deliveries 
is for the National Security Cutter (NSC) being constructed at the 
Northrop Grumman Ship Systems (NGSS) facility in Pascagoula, MS. NGSS 
employment levels have returned to 90 percent of pre-KATRINA staffing 
levels. However, due to personal hardships associated with rebuilding 
efforts, NGSS is experiencing higher levels of absenteeism affecting 
day-to-day production levels.
    Many skilled laborers (electricians, joiners, carpenters, etc.) and 
contract laborers have been lured away by higher paying jobs in the 
emergent residential and commercial construction boom associated with 
KATRINA rebuilding efforts. This creates a ``green'' labor problem 
requiring NGSS to train new employees and slowing the completion of 
tasks that need to be done by an experienced work force.
    The delivery schedules of NSC #1 and #2 have been pushed out by 
approximately 15 and 12 weeks respectively. The Coast Guard is working 
with the Deepwater contractor to understand the costs associated with 
this shift in the workforce.

    Question: The Fast Response Cutter (FRC) will eventually replace 
the current 110 foot cutters. It was not scheduled to enter service 
until 2018. However, the FY 2007 budget request will fund the 
production of the first FRC. Please describe for us why the 
construction of the FRCs had to be significantly accelerated and 
describe for us what we can expect to see in upcoming Coast Guard 
budget requests for the FRCs.
    Response: Increased post 9/11 operational tempo, post 9/11 homeland 
security requirements, the advanced deterioration of the 110-ft patrol 
boat hulls, and increased technical difficulties associated with the 
123-ft conversions have necessitated the acceleration of the Fast 
Response Cutter (FRC) design and production. Expediting the 
introduction of the FRC will bring required capability into Coast Guard 
service much earlier than previously planned before 9/11. Once the 
production line is established the projected Coast Guard budget request 
will reflect construction of approximately two to four FRCs per year.

    Question: Please describe the Service Life Extension Program (SLEP) 
for the existing 110 foot cutters and how is the SLEP is being revised 
to reflect the acceleration of the FRCs?
    Response: Per the Revised Deepwater Implementation Plan, many of 
the Coast Guard's 110-foot patrol boats (WPBs) will remain in service 
for the next 17-18 years. To ensure the WPB fleet remains capable and 
reliable for the duration of its planned service life, a WPB Mission 
Effectiveness Project (MEP) is needed to overcome the significant 
subsystem obsolescence and service life issues contributing to the high 
WPB engineering casualty rates.
    The WPB MEP is comprised of two tiers: (1) vessels requiring major 
hull repairs and (2) vessels requiring only minor hull repairs. Each 
WPB MEP work package includes extensive mechanical and electrical work. 
The MEP has three major objectives: (1) completion of hull and 
structural repairs; (2) replacement of obsolete, unsupportable or 
maintenance-intensive equipment; and (3) completion of depot level 
drydock maintenance.
    Each MEP will address WPB hull and subsystem issues on a hull-by-
hull basis, taking in to account their expected service life to avoid 
over-investing in a particular hull. Therefore, actual WPB MEP costs 
will vary from hull-to-hull based on the physical condition of each 
vessel, the extent of previously completed work and the planned service 
life of the hull. The delivery schedule of the FRCs is accounted for in 
the WPB MEP schedule. Eighteen of the Coast Guard's 49 WPBs will be 
decommissioned between 2008 and 2015 without receiving a MEP, as these 
hulls will be relieved by FRCs.
    The fiscal year 2005 emergency supplemental appropriations, H.R. 
1268, conference report included $49,200,000 to remain available until 
September 30, 2007 for major refits, renovation, and subsystem 
replacement for these boats. This funding will enable the Coast Guard 
to conduct the first 6 WPB MEPs in fiscal years 2006 and 2007, starting 
with USCGC TYBEE in March 2006. As future needs are clarified, the 
Coast Guard will request funding for additional WPB MEPs in the 
Service's budget submissions to Congress. As stated in the February 
2006 Patrol Boat Availability Report to Congress, the current WPB MEP 
plan summary is as follows:

----------------------------------------------------------------------------------------------------------------
         WPB MEP Plan Summary                 Cost              Schedule                   Funding Source
----------------------------------------------------------------------------------------------------------------
110-foot WPB Hulls (18 ea.)                      N/A  FY09-FY14                     Decommissioned per Post
                                                                                    9/11 Deepwater Revised
                                                                                    Implementation Plan
----------------------------------------------------------------------------------------------------------------
123-foot WPB Hulls                               N/A  FY24-FY26                     Decommissioned per Post
                                                                                    9/11 Deepwater Revised
                                                                                    Implementation Plan
----------------------------------------------------------------------------------------------------------------
Lead Ship WPB MEP Cost                          $13M  FY06                          Fiscal Year 2005 Emergency
                                                                                    Supplemental Appropriations,
                                                                                    H.R. 1268
----------------------------------------------------------------------------------------------------------------
110-foot WPB Hulls 2-6                        $36.2M  FY06-FY07                     Fiscal Year 2005 Emergency
                                                                                    Supplemental Appropriations,
                                                                                    H.R. 1268
----------------------------------------------------------------------------------------------------------------
110-foot WPB Hulls 7-23                          TBD  FY08-FY11                     Deepwater Legacy Asset
                                                                                    Sustainment
----------------------------------------------------------------------------------------------------------------

Maritime Security Response Team:
    Question: To what extent will the Department of Justice participate 
in the Maritime Security Response Team program?
    Response: The Coast Guard and Federal Bureau of Investigation (FBI) 
are working more closely together. The FBI's Critical Incident Response 
Group (CIRG) may provide training assistance to the Coast Guard, and 
the MSRT and Hostage Rescue Team (HRT) may participate in 
counterterrorism exercises together to ensure both units are 
interoperable.

    Question: Will they exercise any operational control? If not, what 
chain-of-command structure will the MSRT follow?
    Response: No, there are no plans for DOJ to exercise operational 
control. The operational and tactical control of the MSRT will be with 
the Coast Guard Area Commanders.

    Question: Will they provide any particular training programs?
    Response: There is no formal training being provided currently, but 
it may be possible in the future.

    Question: To what extent is the Department of Defense (DOD) 
participating in the program?
    Response: DOD is participating in the MSRT program by providing 
access to training, doctrine, and subject matter experts.

    Question: How will this team interact with Northern Command?
    Response: The MSRT will participate in selected NORTHCOM exercises 
and can respond to homeland defense missions if required.

    Question: Will the DOD provide special training to Coast Guard MSRT 
members?
    Response: Commander, Special Operations Command has issued 
direction to the units under his command to assist the Coast Guard as 
required in the development of the MSRT program.

    Question: How rapid would this team be able to deploy? What kind of 
``stand by'' status do you envision?
    Response: Currently, the MSRT generally only deploys for planned 
events (e.g. National Special Security Events). However, the Coast 
Guard is working towards a 12 hour ``stand by'' status capability for 
the MSRT. The Fiscal Year 2007 President's Budget Request will provide 
for a 7x24 response capability, dependent upon availability of adequate 
transportation and tactical delivery assets

    Question: Where will they be situated initially?
    Response: The MSRT is currently located in Chesapeake, VA.

    Question: The Coast Guard seeks to be on scene to any mariner in 
distress within 50 miles of coast in 2 hours. What will be its response 
criteria for the deployment of an MSRT?
    Response: The MSRT currently possesses a limited maritime counter-
terrorism capability and is generally only available for planned events 
(e.g. National Special Security Events). The Coast Guard is working 
towards a 12 hour ``stand by'' status capability for the MSRT. The 
Fiscal Year 2007 President's Budget Request will provide for a 7 by 24 
response capability, dependent upon availability of adequate 
transportation and tactical delivery assets.

    Question: Are there any plans to locate a second MSRT on the west 
coast?
    Response: Currently, there are no plans to locate a second MSRT on 
the west coast.

National Capitol Region Air Defense:
    Question: The Coast Guard has requested about $64 million in 
funding and transfers to fund this initiative. How will this impact the 
Coast Guard's current mission portfolio?
    Response: Support of the President's National Capital Region Air 
Defense (NCRAD) Fiscal Year 2007 funding and transfer requests will 
ensure no impact to the Coast Guard's current missions as a result of 
assuming the NCRAD mission.

    Question: Will this expansion of mission sets require a legislative 
change given the maritime nature of your traditional jurisdiction?
    Response: The Coast Guard's role in the National Capital Region Air 
Defense will not require any legislative change. Title 10 and Title 14 
US Code contain all of the authority required for the Coast Guard to 
execute both the national defense and law enforcement aspects of this 
mission.

    Question: What are the advantages of Coast Guard performing this 
mission versus other Federal law enforcement agencies?
    Response: Defense of the National Capital Region (NCR) is a DoD 
responsibility under Operation Noble Eagle. Unlike other federal law 
enforcement agencies, the Coast Guard has Title 10 U.S. Code authority, 
allowing seamless integration into North American Air Defense command 
and control.
    A secondary mission is air security / law enforcement. Primary 
responsibility for this mission rests with the FBI and Secret Service. 
If released from its primary mission of Air Defense, the Coast Guard, 
under Title 14 U.S. Code authority, will assist these agencies with 
their air security responsibilities under Title 14 U.S. Code.
    The Coast Guard is working closely with all agencies in the 
National Capital Region Coordination Center (NCRCC) to ensure unity of 
effort and mission effectiveness within the National Capital Region. 
The Coast Guard's entry into the National Capital Air Defense mission 
will benefit the NCR's residents and general aviation pilots by 
providing a more efficient, safe and effective execution of the air 
defense mission.

    Question: To the best of your knowledge, what other federal 
entities have an active airborne use of force mission?
    Response: The Coast Guard is not aware of any Federal agencies, 
with the exception of the Department of Defense, that have an airborne 
use of force mission.

    Question: While exercising this new mission: Who will order the 
launch of the Coast Guard helicopters? Who will control the mission? 
Will the assets be armed?
    Response: NORAD will have tactical control (TACON) of Coast Guard 
assets supporting the National Capital Region Air Defense initiative. 
This tactical control includes launch authority and mission control. 
Some personnel in the helo will be armed with personal defense weapons. 
There is no current NORAD requirement for Coast Guard NCR helicopters 
to be armed.

    Question: Will they shoot down an aircraft that enters the 
restricted airspace if ordered to do so? What if air intercepts are not 
able to respond in time--will they shoot if ordered to do so?
    Response: No. There is no current requirement for Coast Guard NCR 
helicopters to have shoot down capability. Other measures will be taken 
to respond to non-complaint aircraft. We suggest you contact DOD for 
more information.

    Question: What is the specific date that the Coast Guard will take 
over the NCR mission?
    Response: The Coast Guard's target start date for initial operating 
capability is during the last quarter of Fiscal Year 2006. That date is 
contingent upon the timing of Congressional approval of a DHS request 
to transfer $4M of Fiscal Year 2006 funds to the Coast Guard. 
Approximately five months after approval of the $4M funds transfer 
request, the Coast Guard will be able to assume the mission.

    Question: Where will the assets come from?
    Response: The President's Fiscal Year 2007 budget requests funds to 
acquire and missionize five (5) new or used HH-65 helicopters to 
support the National Capital Region Air Defense (NCRAD) initiative. In 
the interim, NCRAD will be supported by existing fleet aircraft (HH-
65Cs) normally dedicated to special missions/cutter support.

    Question: How will the Coast Guard ensure that it can meet its 
other missions while the requested five helicopters needed to perform 
this mission are delivered?
    Response: The NCRAD mission will be initially supported by existing 
fleet aircraft (HH-65C) normally dedicated to special missions/cutter 
support. The Coast Guard will exercise the last year option on the 
current HITRON MH-68 helicopter service contract to provide an 
additional 1000 cutter helicopter days deployed at sea through January 
2008 while five additional USCG HH-65C helos are procured and 
missionized. Exercising the last year option of the HITRON MH-68 armed 
helicopter service contract will ensure no negative impact to current 
USCG missions.
Reclassification of Drug Interdiction as a Non-Homeland Security 
Mission:

    Question: Is it fair to say that in your experience, drug smugglers 
and human smugglers often use the same transit routes?
    Response: Yes.

    Question: How will this reclassification benefit Coast Guard 
operations?
    Response: The Coast Guard anticipates no benefit as a result of 
this reclassification.

    Question: Please describe for the committee why the Office of 
Management and Budget is justifying this change.
    Response: To align with other Federal counterdrug programs, all of 
which are not classified as homeland security activities. Additional 
details are available from the Office of Management and Budget.

                    Questions from Hon. Curt Weldon

    Question: How did the Coast Guard decide on using the HH-65 for 
National Capital Region response?
    Response: The HH-65C helicopter was the ``aircraft of choice'' for 
the National Capital Region Air Defense (NCRAD) mission due its (a) 
ability to meet NCRAD mission requirements, (b) relatively low 
operating cost, (c) the large number of HH-65 helicopters in the Coast 
Guard fleet, and (d) the availability and comparatively low cost to 
acquire additional assets on the commercial market.

    Question: Did you consider other options like the MH-68 that the 
Coast Guard currently uses for HITRON?
    Response: The Coast Guard did consider the HH-60J, HH-65C and MH-68 
helicopters for the NCR mission.
    The HH-65C helicopter was chosen as the most ideally suited and 
cost effective airframe to meet NCR requirements.

    Question: Isn't the MH-68 already in service and authorized for 
Airborne Use of Force?
    Response: The MH-68 helicopter is Airborne Use of Force air-to-
surface capable, and being used by the Coast Guard for counter drug 
operations. However, at present, DOD, DHS, and DOJ do not require an 
armed helicopter to support the National Capital Region Air Defense or 
law enforcement. Due to its maximum airspeed limitations, the MH-68 
helicopter does not meet the NCRAD Rotary Air Wing Intercept 
requirements.

    Question: Hasn't the MH-68 successfully conducted similar missions 
at places such as political conventions and the G-8 Summit?
    Response: MH-68 helicopters have been used for port security 
missions during National Special Security Events such as the Republican 
National Convention, Democrat National Convention, and the G-8 Summit, 
where an Airborne Use of Force capability was required for surface 
threats. However, the MH-68 helicopter has never been used as a Rotary 
Wing Air Intercept platform, as is required for the NCR mission.

    Question: What is your plan for fielding the HH-65's for this 
mission?
    Response: The President's Fiscal Year 2007 budget requests funds to 
acquire and missionize five (5) additional HH-65C helicopters to 
support the National Capital Region Air Defense (NCRAD) initiative. In 
the interim, NCRAD will be supported by existing fleet aircraft (HH-
65Cs) normally dedicated to special missions/cutter support. The Coast 
Guard will exercise the last year option of the armed HITRON MH-68 
helicopter service contract to provide an additional 1000 cutter helo 
days deployed at sea through January 2008, bridging the time until 5 
additional HH-65C aircraft can be acquired.

    Question: Will you take existing assets away from their mission to 
serve in this role?
    Response: The National Capital Region Air Defense mission will be 
initially supported by existing fleet aircraft (HH-65Cs) normally 
dedicated to special missions/cutter support. The Coast Guard will 
exercise the last year option of the current HITRON MH-68 helicopter 
service contract to provide an additional 1000 cutter helicopter days 
deployed at sea through January 2008, while five additional USCG HH-65C 
helos are procured and missionized. Exercising the last year option of 
the HITRON MH-68 armed helicopter service contract will ensure no 
negative impact to current USCG missions.

    Question: Is your plan the most efficient and cost effective 
option?
    Response: Yes, the selection of the HH-65C for the National Capital 
Region Air Defense (NCRAD) mission is the most efficient and cost 
effective Coast Guard option.

    Question: Are you considering acquiring or leasing used HH-65's for 
the Coast Guard, for this mission or any other mission? If so, how will 
you certify that these aircraft meet the Coast Guard's safety 
standards?
    Response: The President's Fiscal Year 2007 budget requests funds to 
acquire and missionize five (5) new or used HH-65 helicopters to 
support the National Capital Region Air Defense (NCRAD) mission.
    When the Coast Guard acquires and/or missionizes a new or used HH-
65 aircraft, the helicopter will initially be inducted into the Coast 
Guard's Aircraft Repair & Supply Center (ARSC). This induction will 
ensure aircraft standardization and certification. ARSC has a proven 
record for successfully modifying civil AS-365 (USCG HH65 like) 
airframes into Coast Guard HH-65 aircraft.

                   Questions from Hon. Mark E. Souder

New Definition of Homeland Security

    When Congress created DHS in 2002, it combined some of the most 
important drug interdiction agencies in the Federal Government. While 
the Coast Guard's homeland security missions are not new, they were 
statutorily defined in Section 888 of the Homeland Security Act of 2002 
(Public Law 107-296) as follows: ports, waterways, and coastal 
security; drug interdiction; migrant interdiction; defense readiness; 
and other law enforcement.
    Contrary to this statutory definition of the homeland security 
missions that includes drug interdiction and other enforcement, the 
Administration's 2007 budget request categorizes ``Illegal Drug 
Interdiction'' and ``Other Law Enforcement'' missions as ``Non-Homeland 
Security'' missions. (Coast Guard Budget in Brief document (page B-2). 
This proposed change clearly runs contrary to the organic statute 
establishing DHS.

    Question: Who has authorized the change of definitions and 
therefore priorities for the Coast Guard regarding drug interdiction?
    Response: Section 889 of the Homeland Security Act (P.L. 107-296) 
authorizes the Office of Management and Budget to compile estimates of 
funding related to homeland security consistent with the definition 
from the 2002 Annual Report to Congress on Combating Terrorism. That 
report refers to ``homeland security'' as those activities that detect, 
deter, protect against, and respond to terrorist attacks on the United 
States. Upon review of the Coast Guard programs for ``Drug 
Interdiction'' and ``Other Law Enforcement,'' OMB determined that these 
programs do not meet government-wide standards for the definition in 
section 889, and reclassified the funding to ensure consistency in 
reporting homeland security programs to the Congress. The ``Other Law 
Enforcement'' mission focuses on the enforcement of maritime fishery 
boundaries, primarily in the North Pacific ocean around the state of 
Alaska, and does not directly focus on terrorism or terrorists. The 
``Drug Interdiction'' mission is nearly identical to the activities of 
the Drug Enforcement Agency, the funding for which is classified 
entirely as ``non-homeland security.''
    OMB also closely reviewed section 888 of P.L. 107-296, which 
clearly states that categorizing ``Drug Interdiction'' and ``Other Law 
Enforcement'' as ``homeland security'' only applies to that specific 
part of the legislation, not the separate section 889 which prescribes 
how OMB should report homeland security programs government-wide. This 
interpretation was approved by the OMB Counsel's office and accepted by 
the DHS Counsel's office.

    Question: Did lawyers at ONDCP, DHS and Coast Guard sign off on 
this abdication of duty?
    Response: Section 889 of the Homeland Security Act (P.L. 107-296) 
authorizes the Office of Management and Budget to compile estimates of 
funding related to homeland security consistent with the definition 
from the 2002 Annual Report to Congress on Combating Terrorism. That 
report refers to ``homeland security'' as those activities that detect, 
deter, protect against, and respond to terrorist attacks on the United 
States. Upon review of the Coast Guard programs for ``Drug 
Interdiction'' and ``Other Law Enforcement,'' OMB determined that these 
programs do not meet government-wide standards for the definition in 
section 889, and reclassified the funding to ensure consistency in 
reporting homeland security programs to the Congress. The ``Other Law 
Enforcement'' mission focuses on the enforcement of maritime fishery 
boundaries, primarily in the North Pacific ocean around the state of 
Alaska, and does not directly focus on terrorism or terrorists. The 
``Drug Interdiction'' mission is nearly identical to the activities of 
the Drug Enforcement Agency, the funding for which is classified 
entirely as ``non-homeland security.''
    OMB also closely reviewed section 888 of P.L. 107-296, which 
clearly states that categorizing ``Drug Interdiction'' and ``Other Law 
Enforcement'' as ``homeland security'' only applies to that specific 
part of the legislation, not the separate section 889 which prescribes 
how OMB should report homeland security programs government-wide. This 
interpretation was approved by the OMB Counsel's office and accepted by 
the DHS Counsel's office. ONDCP was also aware of the change.

    Question: Does the Coast Guard support the proposed new change in 
categories for its Drug Interdiction mission?
    Response: The Coast Guard supports the President's Budget. 
Regardless of budget classification, the mission to secure and protect 
the maritime domain against all threats, including illegal narcotics, 
is critical to the security of the United States. The Coast Guard 
continues to have unprecedented success in the counterdrug mission. The 
Coast Guard, working with its interagency and international partners, 
removed 338,206 pounds of cocaine (including nearly 303,662 pounds 
seized) during fiscal year 2005--a record year. This success will be 
maintained by pursuing the three principles of its 10-year Strategic 
Counter Drug Plan known as STEEL WEB:
         Pursuing more tactical, actionable intelligence, then 
        responding with flexible intelligence-driven operations;
         Leveraging technology by fast tracking new tools and 
        bringing more capable assets to the fight; and
         International engagement with our counterdrug partner 
        nations, which speeds up the seizure and disposition process 
        and gains U.S. jurisdiction to help feed the intelligence 
        cycle.

    Question: How will the proposed change impact the administration, 
management, funding and operations of the Coast Guard's drug 
interdiction mission?
    Response: The President develops his budget proposal annually to 
identify the highest-priority needs of the country. The change in 
homeland security classification of the Coast Guard ``Drug 
Interdiction'' budget was made to ensure consistent reporting of 
homeland security funding in the budget document, not to signal a 
revision to the President's commitment to funding the effort to 
eliminate the illegal importation of drugs into the country.
    The revision to the homeland security classification of the Drug 
Interdiction budget will also have no effect on the Coast Guard's 
ability to execute this mission, or on the agency's effectiveness in 
reducing the illegal drug trade in the maritime environment.

    Question: How will this change impact the Coast Guard Drug 
Interdiction budget? Will it impact out-year budget projections?
    Response: By design, the Coast Guard is a multi-mission, military 
service. While it has developed cost models that allow the allocation 
of asset hours and resources to its eleven mission-programs, it is 
appropriated dollars through general discretionary accounts (e.g., 
Operating Expenses; Acquisition, Construction and Improvements; etc.) 
that allow the Coast Guard to efficiently and effectively execute its 
broad mission portfolio and surge assets to meet maritime threats. 
Coast Guard cutters and aircraft rarely go to sea for a single purpose, 
but rather typically enforce all applicable laws and treaties and 
protect the safety and security of the maritime domain. For example, a 
Coast Guard cutter on patrol in the Caribbean or Eastern Pacific 
transit zone may in a single week make a maritime drug seizure, 
intercept undocumented migrants at sea, and respond to a vessel in 
distress.
    This multi-mission character makes the whole of the Coast Guard's 
mission-programs much greater than the sum of its individual parts. It 
also challenges traditional budget classification. The Coast Guard's 
multi-mission character is a trusted and tested operational model 
evidenced most recently in the service's stellar response during 
hurricane Katrina. The last thing we would want is Coast Guard 
operational commanders limited in their ability to respond because of 
artificial budget 'stovepipes.?
    The Department and Coast Guard remain focused on effective mission 
execution and performance results. While I cannot speculate on future 
impacts, if any, to the Coast Guard's drug interdiction mission, my 
immediate concern is that we fully fund the President's Budget Request 
for the Coast Guard each year. Unfortunately, the trend is in the wrong 
direction. The enacted fiscal year 2006 budget was almost $150 million 
below the President's Request, including more than a $33 million 
reduction to the Coast Guard's primary recapitalization effort--
Deepwater. Several of the reductions directly affect drug interdiction 
effectiveness, such as deploying airborne use of force capability and 
C4ISR improvements. Coast Guard capability and capacity provides a 
unique and effective instrument of Homeland Security. As a result, I?m 
confident that preserving Coast Guard readiness and capability to 
conduct all missions will continue to be an Administration budget 
priority. I ask for your continued staunch support to ensure it also 
remains a Congressional budget priority.

    National Capital Region Air Defense mission
    The President's 2007 budget proposes $62.44 million for the 
establishment of a permanent National Capital Region Air Defense 
(NCRAD) program, a function being transferred to the U.S. Coast Guard 
from Customs and Border Protection. On November 2, 2005, I requested 
detailed planning documents from the Coast Guard regarding the proposed 
new mission. To date, I have still not received any further information 
pertaining to these plans.
    Question: What is the Coast Guard's plan to support the NCRAD 
mission?
    Response: In the President's FY07 Budget, funding is requested to 
acquire, staff and operate five (5) HH-65 helicopters in support of the 
National Capital Region Air Defense (NCRAD) mission. These helicopters 
will be assigned to CGAS Atlantic City and conduct NCRAD missions from 
a Forward Operating Base (FOB) at Ronald Reagan Washington National 
Airport. Operating under NORAD tactical control, three of the five 
helicopters will be located at National's Signature Aviation hangar 
with two crews on a 24/7 strip alert.
    The target USCG start date is late fiscal year 2006. Approximately 
five months after Congressional approval of a pending DHS request to 
transfer $4M in fiscal year 2006 funds, Coast Guard will take over the 
mission. Until additional HH-65C helicopters are acquired, existing 
fleet aircraft currently used to support special missions and cutter 
deployments will be used to support this mission. The Coast Guard 
intends to exercise the last option year of the HITRON MH-68 service 
contract to provide an additional 1000 Armed Helicopter Cutter Days 
Deployed at Sea as a bridging strategy, ensuring no impact to existing 
missions until the additional helicopters can be acquired and 
missionized.

    Question: What is the implementation date?
    Response: The Coast Guard's target start date for initial operating 
capability is late in Fiscal Year 2006. The exact date is contingent 
upon the timing of Congressional approval of a DHS request to transfer 
$4M of Fiscal Year 2006 funds to the Coast Guard. Approximately five 
months after congressional approval to transfer funding, USCG will be 
able to assume the mission.

    Question: Where will the five aircraft funded in the FY 2007 budget 
come from?
    Response: An open market acquisition competition will be used to 
procure five (5) HH-65 helicopters. The supplier must either provide 
missioned HH65C helicopters, or 5 new or used AS-365 N3 airframes which 
USCG can modify at the Coast Guard's Aircraft Repair & Supply Center 
(ARSC) to USCG specifications. The decision to buy new aircraft or buy 
airframes and missionize them will be based on information received 
from a pending Industry Request for Information.
    HH-65C helicopters are required for fleet standardization, which 
ensures efficiencies in logistics, reduces maintenance costs, and 
standardizes training for pilots and aircrew.

    Question: Will the Coast Guard purchase new aircraft, or will 
aircraft be diverted from drug interdiction missions and in subsequent 
years be replaced by new acquisitions?
    Response: The President's Fiscal Year 2007 budget requests funds to 
acquire and missionize five (5) additional HH-65 helicopters to support 
the National Capital Region Air Defense (NCRAD). The NCRAD mission will 
be initially supported by existing fleet aircraft (HH-65C) normally 
dedicated to special missions/cutter support. The Coast Guard will 
exercise the last year option of the current HITRON MH-68 helicopter 
service contract to provide an additional 1000 cutter helicopter days 
deployed at sea through January 2008, while five additional USCG HH-65C 
helos are procured and missionized.
    Exercising the last year option of the HITRON MH-68 armed 
helicopter service contract will ensure no impact to current USCG 
missions.

    Question: The FY 2007 calls for the procurement of five helicopters 
to support the NCRAD mission, but a DHS Budget Officer has said the 
program needs seven. Where will the other two aircraft come from, and 
will they be diverted from interdiction efforts?
    Response: The acquisition of two additional HH-65 helicopters to 
support the National Capitol Region Air Defense (NCRAD) mission will be 
requested in future Coast Guard budgets. These last two aircraft will 
be used to support increased training needs at Aviation Training Center 
Mobile, AL and to add an additional depot level support aircraft. In 
the interim there will be no need to divert operational aircraft to 
fill these needs.

Deepwater Recapitalization
    This year's budget proposal includes $934.43 million for the 
Deepwater Recapitalization project. The 2007 Coast Guard Budget in 
Brief describes this funding as supporting the ordering of additional 
cutters of varying abilities, additional maritime patrol aircraft, and 
the completion of the engine upgrade program for the HH-65 helicopters. 
The Coast Guard's ability to perform interdiction is spread very thin 
by the limited number and age of its assets.
    Question: Will these new cutters arrive in time to alleviate the 
down time caused by deteriorating legacy cutters and aircraft?
    Response: As explained in the Patrol Boat Availability Report, the 
schedule does not alleviate the gap in required cutter hours until at 
least 2009. Other interdiction platforms are similarly affected, 
however, and the Coast Guard is committed to maintaining the 
operational capabilities of its legacy assets and minimizing any 
downtime caused by traditional long-lead construction times and 
deteriorating legacy assets, through legacy sustainment projects. These 
sustainment projects are designed to maintain existing legacy asset 
capabilities and ensure the reliability of these assets until they are 
replaced by their Deepwater counterparts. The Coast Guard has 
additionally taken steps to mitigate the impacts of these projects to 
the largest extent possible. For example, the Coast Guard has limited 
the number of cutter sustainment projects in each fiscal year to 
maintain sufficient operational asset capacity.

    Question: Will the Coast Guard experience significant ``gaps'' in 
capabilities due to the current Deepwater production schedule?
    Response: The Coast Guard's Operational Gap Analysis Report details 
forecast gaps in cutter and aircraft operational hours during the 
transition to its new deepwater fleet. Because of increased 
efficiencies that have resulted from Deepwater upgrades to legacy 
equipment, Coast Guard hopes to minimize the effect of these gaps on 
mission performance. The transition schedule minimizes gaps in 
operational capabilities, but some gaps are unavoidable as some legacy 
assets are taken offline for sustainment projects. Also some delays are 
encountered while newly delivered assets and crews are being trained 
and tested before becoming fully operational. The Coast Guard has taken 
every effort to minimize fleet impact during this transition, but some 
unavoidable operational gaps remain. Full funding of the Deepwater 
project within the annual President's Budget Request is also critical 
to minimizing these gaps.

Maritime Patrol Aircraft
    DoD maritime patrol aircraft hours operating in the transit zone 
have drastically decreased over the past three years, for various 
reasons, from a high of 5,964 hours in 2002 to only 1,500 hours in 
2005. The Coast Guard, CBP, and allies have tried to fill this gap, but 
simply do not have the additional assets needed. To respond to this 
situation the FY 2007 includes the acquisition of three CASA 235 
aircraft to augment MPA for Deepwater.
    Question: Are three aircraft included in the FY 2007 budget enough 
to meet the Coast Guard's and JIATF-South's immediate need for aircraft 
to perform the MPA (detection, monitoring, and interdiction) mission?
    Response: The President's Fiscal Year 2007 budget requests $77.6M 
for the acquisition of one aircraft, which would be the Coast Guard's 
sixth CASA. In addition, this request funds logistics, spare parts, and 
support for CASAs four through six. The Fiscal Year 2007 budget would 
also fund two quarters of operations for the third CASA aircraft. 
Operating funds for the first two aircraft were contained in the Fiscal 
Year 2006 budget.
    The first three CASAs are forecast to be fully operational late in 
Fiscal Year 2007. Until that time the CASA flight hours will be 
dedicated to training, Design Testing and Evaluation and Operational 
Testing and Evaluation flights that must be done prior to introducing 
these new aircraft to the Coast Guard fleet. Once fully operational, 
each CASA aircraft will provide 1200 MPA hours per year.

    Question: What type of palletized radar and sensing equipment will 
be installed on these aircraft?
    Response: The sensors on the CASA CN235 Maritime Patrol Aircraft 
include:
         EDO ALR-95(V) 2 Electronic Support Measures (ESM),
         Saab R4A Automatic Identification System (AIS) 
        Airborne Transmitter,
         FLIR Systems Star Safire III Electro-Optical/Infra-Red 
        (EO/IR),
         Telephonic APS-143B(V) 3 Multi-Mode Radar (MMR), and
         Rockwell Collins DF-430F Direction Finder (DF).

    Question: How do these aircraft and their sensor packages compare 
to the U.S. Navy and Customs and Border Protection P-3 aircraft and the 
current sensor package utilized in the HC-130?
    Response: The U.S. Navy and CBP P-3, Coast Guard HC-130, and the 
Coast Guard CASA 235-300M aircraft, with some variances, have the same 
basic sensor capability. All three aircraft types have surface search 
radar and an Electro Optical / Infrared package. The Coast Guard's CASA 
aircraft will additionally have connectivity to the Common Operating 
Picture (COP) and will be able to display the local tactical picture, 
increasing situational awareness. The local tactical picture 
simultaneously blends electronic inputs from the Automatic 
Identification System, surface search radar, an Electronic Surveillance 
Measures / Specific Emitter Identification package, and the COP with 
aerial charts.

    The FY 2007 budget also includes funding to missionize and upgrade 
the sensors in Coast Guard HC-130 MPA aircraft.
    Question: What type of palletized radar and sensing equipment will 
be installed on these aircraft?
    Response: The HC-130H has a mission pallet that receives sensor 
data from a surface search radar and an electro-optical infra-red (EO/
IR) sensor. The fiscal year 2007 President's budget request includes 
funding to replace the aging surface search radar and obsolete avionics 
suite.

                                 

```