Contents/Abbreviations 

Improvements Needed in the U.S. Coast Guard’s Acquisition and 

Implementation of Deepwater Information Technology Systems

DEPARTMENT OF HOMELAND SECURITY 

Office of Inspector General 

Improvements Needed in the U. S. 

Coast Guard’s Acquisition and 

Implementation of Deepwater 

Information Technology Systems

Office of Information Technology 

OIG-06-55 August 2006
Office of Inspector General 

U.S. Department of Homeland Security 

Washington, DC 20528 

Homeland 

Security 

August 11, 2006 

Preface 

The Department of Homeland Security (DHS) Office of Inspector General (OIG) was established by 

the Homeland Security Act of 2002 (Public Law 107-296) by amendment to the Inspector General 

Act of 1978. This is one of a series of audit, inspection, and special reports prepared as part of our 

oversight responsibilities to promote economy, effectiveness, and efficiency within the department. 

This report assesses the development and implementation of information technology (IT) systems to 

support the U.S. Coast Guard’s Integrated Deepwater System program. It is based on interviews 

with employees and officials at Coast Guard headquarters and the Maritime Domain Awareness 

Center as well as other relevant agency facilities, vessels, and contractor organizations and a review 

of applicable documents. 

The recommendations herein have been developed to the best knowledge available to our office, and 

have been discussed in draft with those responsible for implementation. It is our hope that this 

report will result in more effective, efficient, and economical operations. We express our 

appreciation to all of those who contributed to the preparation of this report. 

Richard L. Skinner 

Inspector General 
Contents/Abbreviations 

 Executive Summary....................................................................................................................... 1 

 Background.................................................................................................................................... 2 

Results of Audit .............................................................................................................................. 6 

System Development Approach Could Be Improved........................................................... 6 

Recommendations................................................................................................................ 14 

Deepwater Systems Implementation Challenges................................................................. 15 

Recommendations............................................................................................................... 32 

Management Comments and OIG Evaluation ............................................................................. 32 

Appendices 

Appendix A: Scope and Methodology ................................................................................ 37 

Appendix B: Management Response to Draft Report...........................................................39 

Appendix C: Major Contributors to this Report.................................................................. 44 

Appendix D: Report Distribution ..........................................................................................45 

Abbreviations 

C4ISR Command, Control, Communications, Computers, Intelligence, 

Surveillance, and Reconnaissance 

COMOPTEVFORCommander, Operational Test and Evaluation Force 

DHS Department of Homeland Security 

DITSCAP Department of Defense Information Assurance and Defense Information 

Technology Security Certification and Accreditation Process 

GAO Government Accountability Office 

ICGS Integrated Coast Guard Systems 

IT Information Technology 

LIMS Logistics Information Management System

 OIG Office of Inspector General 

SIPRNET Secret Internet Protocol Router Network 

USCG United States Coast Guard 

USCGC United States Coast Guard Cutter 

Figures 

Figure 1 Ships and Aircraft Included in the Deepwater Program ...................................3 

Figure 2 Proposed Seamless Interoperability Among Deepwater Assets .......................4 

Improvements Needed in the U.S. Coast Guard’s Acquisition and 

Implementation of Deepwater Information Technology Systems
Contents/Abbreviations 

Figure 3 Requirements Definition Process......................................................................8 

Figure 4 Deepwater Contractor Relationships ..............................................................16 

Figure 5 USCGC MATAGORDA, 123-Foot Patrol Boat ............................................26 

Figure 6 USCG Short Range Prosecutor.......................................................................30 

Improvements Needed in the U.S. Coast Guard’s Acquisition and 

Implementation of Deepwater Information Technology Systems
OIG 

Department of Homeland Security 

Office of Inspector General 

Executive Summary 

Declining readiness of “Deepwater” assets, including aircraft and cutters of 

various sizes, has hindered the Coast Guard’s effectiveness in accomplishing 

its homeland security, law enforcement, and regulatory missions. To meet the 

demand for improved communications, interoperability, and maritime security 

in today’s environment, the Coast Guard has embarked on an estimated 20-

year, $20 billion acquisition to modernize and strengthen its aging Deepwater 

fleet. 

We audited the Coast Guard’s efforts to design and implement command, 

control, communications, computers, intelligence, surveillance, and 

reconnaissance (C4ISR) systems to support the Integrated Deepwater System 

program. As a result of our audit, we determined that the Coast Guard’s 

efforts to develop its Deepwater C4ISR systems could be improved. Although 

Coast Guard officials are involved in high-level Deepwater IT requirements 

definition processes, they have limited influence over contractor decisions 

toward meeting these requirements. A lack of discipline in requirements 

change management processes provides little assurance that the requirements 

remain up-to-date or effective in meeting program goals. Certification and 

accreditation of Deepwater C4ISR equipment has been difficult to achieve, 

placing systems security and operations at risk. Further, although the 

Deepwater program has established IT testing procedures, the contractor has 

not followed them consistently to ensure that C4ISR systems and the assets on 

which they are installed perform effectively. 

Additionally, the Coast Guard faces several challenges to implementing 

effectively its Deepwater C4ISR systems. Due to limited oversight as well as 

unclear contract requirements, the agency cannot ensure that the contractor is 

making the best decisions toward accomplishing Deepwater IT goals. 

Insufficient C4ISR funding has restricted accomplishing the “system-ofsystems” objectives that are considered fundamental to Deepwater asset 

interoperability. Inadequate training and guidance hinder users from realizing 

the full potential of the C4ISR upgrades. Instituting effective mechanisms for 

maintaining C4ISR equipment have been equally challenging. 

Improvements Needed in the U.S. Coast Guard’s Acquisition and 

Implementation of Deepwater Information Technology Systems

Page 1 
Background 

According to the Homeland Security Act of 2002, the U.S. Coast Guard’s 

eleven missions cover both homeland and non-homeland security matters.1 

Homeland security missions include ensuring security of ports, waterways, 

and coasts; defense readiness; drug and migrant interdiction; and other law 

enforcement duties. Non-homeland security missions include maintaining 

marine safety; coordinating search and rescue; providing aids to navigation; 

promoting marine resources and protection; and, overseeing ice removal 

operations. 

To accomplish its deepwater missions, the Coast Guard maintains a variety of 

assets, including 186 aircraft and 88 cutters of various sizes, capable of 

sustaining operations 50 miles offshore in severe maritime conditions. These 

assets must be available long-term, 24 hours a day, everyday, and everywhere 

that the Coast Guard’s humanitarian, law-enforcement, national security, 

maritime safety, or military presence is needed. Typically, however, the 

assets have been unavailable and lacked the capabilities necessary to perform 

traditional and homeland security missions effectively. The assets are 

experiencing declining readiness due to worn out equipment; their lack of 

essential speed, interoperability, and sensor and communications capabilities 

severely limits overall mission effectiveness and efficiency. 

In the mid-1990s, the Coast Guard began planning a recapitalization program 

to replace or modernize these aging and technologically obsolete deepwatercapable assets. The primary objectives of the recapitalization program were to 

maximize operational effectiveness and minimize total ownership costs while 

satisfying the needs of Coast Guard customers. Customers included the 

operational commanders, aircraft pilots, cutter crews, maintenance personnel, 

and others who use the assets. 

This earlier recapitalization effort formed the basis for the Coast Guard’s 

Integrated Deepwater Systems program. Established in 2002, the 

“Deepwater” acquisition program is estimated to take between 20 and 25 

years and cost $19 to $24 billion to complete. The Coast Guard awarded the 

Deepwater contract to a prime contractor, Integrated Coast Guard Systems 

(ICGS), a joint venture between Lockheed Martin and Northrop Grumman 

Ship Systems. The prime contractor identified the assets in need of 

modernization and is using tiers of subcontractors to design and build new 

assets. (See Figure 1.) The Deepwater program is not only replacing old 

ships and aircraft, but is offering an integrated approach to upgrading other 

1

 Public Law 107-296, November 25, 2002. 

Improvements Needed in the U.S. Coast Guard’s Acquisition and 

Implementation of Deepwater Information Technology Systems

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existing assets with improved C4ISR equipment and innovative logistics 

support systems, too. 

Figure 1: Ships and Aircraft Included in the Deepwater Program 

The Deepwater program consists of five domains: 

• Surface—consists of updating legacy assets and building new classes of 

cutters, such as the National Security Cutter, the Offshore Patrol Cutter, 

and the Fast Response Cutter. These newer, more seaworthy cutters will 

include reconfigurable spaces that can be tailored for specific missions. 

• Air—consists of modernizing aircraft and building a comprehensive, 

long-term aviation force, including maritime patrol aircraft, unmanned 

aerial vehicles, and high-altitude endurance unmanned aerial vehicles. 

• C4ISR—consists of modernizing the Coast Guard’s command, control, 

communications, computers, intelligence, surveillance, and 

reconnaissance systems to promote seamless communications between 

assets. 

• Logistics—comprised of the Integrated Logistics Support System, 

which is a requirements-driven, performance-based approach to 

integrating the support processes and capability needed to improve 

operational effectiveness and reduce total ownership costs in each of the 

preceding three domains. 

• System-of-Systems—serves as an umbrella domain, encompassing the 

other four domains to ensure that all assets can interoperate. As the 

focal part of the Deepwater program, this domain was created to provide 

central management of program performance, cost, schedule, and risk. 

Improvements Needed in the U.S. Coast Guard’s Acquisition and 

Implementation of Deepwater Information Technology Systems

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The Deepwater C4ISR platform is a fundamental building block to improving 

maritime domain awareness by focusing on the information needs of operators 

and decision makers. The C4ISR program manager oversees all facets of 

C4ISR implementation including resource management, strategic planning, 

and organizational performance measurement activities and processes. The 

C4ISR platform is designed to ensure seamless interoperability among all 

Coast Guard units and DHS components as well as with other federal 

agencies, especially the Navy. Modernization efforts to date demonstrate that 

legacy assets upgraded with new C4ISR systems enable earlier awareness, 

coordination, and response to possible threats by gathering and fusing 

terrorist-related information and analysis and increasing communications. 

When Deepwater is fully implemented, the Coast Guard’s assets will no 

longer operate as independent platforms with only limited awareness of their 

surroundings in the maritime domain. Instead, the assets will have improved 

capabilities to receive information from a wide array of mission-capable 

platforms and sensors. They will share a common operating picture as part of 

a network-centric force, operating in tandem with other cutters, boats, manned 

aircraft, and unmanned aerial vehicles. (See Figure 2.) 

Figure 2: Proposed Seamless Interoperability Among Deepwater Assets 

The C4ISR implementation plan outlines a strategy for upgrading shore, air, 

and surface assets in the following phases. 

• Increment one, implemented from 2002 to 2005, included satellite voice 

and data communication capability, Coast Guard command and control 

systems, and law enforcement radios added to surface and shore assets. 

Coast Guard command and control systems include the following 

Improvements Needed in the U.S. Coast Guard’s Acquisition and 

Implementation of Deepwater Information Technology Systems

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functions: sensor and systems interfaces; operator support and display; 

mission support; track management; and command and control support 

services. 

• Increment two, to be implemented from 2004 to 2007, includes adding 

C4ISR equipment, radios, and radar to multi-mission cutter helicopters, 

unveiling the first maritime patrol aircraft, and adding Coast Guard 

command and control systems upgrades to international ice patrol shore 

assets. 

• Increment three, beginning in 2007, includes implementing additional 

Coast Guard command and control systems as well as planning a hardware 

technology refresh. 

• Increment four, scheduled for 2009 to 2012, includes strategic and 

operational planning for Coast Guard command and control systems, high 

frequency surface wave radar integration, mission support, and data query. 

In recent years, the Government Accountability Office (GAO) has evaluated 

Deepwater program efforts, citing management oversight problems in each of 

its reports. In March 2004, GAO reported that the integrated product teams 

charged with overseeing the system integrator had struggled to effectively 

collaborate and accomplish their missions.2 Specifically, GAO reported that 

the Coast Guard had not yet begun to measure the system integrator’s 

performance on the three overarching goals of the Deepwater program: 

operational effectiveness, total ownership cost, and customer satisfaction. 

GAO recommended that the Coast Guard take the necessary steps to make the 

Deepwater integrated product teams effective, improve contractor 

accountability, and review the human capital plan to ensure adequate staffing. 

Also, in June 2004, GAO reported that Deepwater program officials had not 

updated the initial 2002 integrated acquisition schedule. 3 During its review, 

GAO attempted to identify a current acquisition status and found that a 

number of selected Deepwater assets had experienced delays and were at risk 

of being delivered later than anticipated. Therefore, GAO recommended that 

the DHS Secretary require the Coast Guard to update its integrated acquisition 

schedule as part of its FY 2006 budget submission. Further, in a 2005 report, 

2

 Contract Management: Coast Guard’s Deepwater Program Needs Increased Attention to Management and Contractor 

Oversight, U.S. Government Accountability Office (GAO-04-380, March 2004). 3 Deepwater Program Acquisition Schedule Update Needed, U.S. Government Accountability Office (GAO-04-695, 

June 2004).

Improvements Needed in the U.S. Coast Guard’s Acquisition and 

Implementation of Deepwater Information Technology Systems

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GAO said the Coast Guard had not captured, to the full extent possible, the 

decline in the condition of its assets. 4 

More recently, in April 2006 GAO reported that the Coast Guard has made 

progress in addressing some of the management oversight issues identified in 

previous reports.5 Specifically, GAO noted that the Coast Guard has provided 

additional guidance, training, criteria, and measures to improve its program 

management assessments of the system integrator’s performance. 

Additionally, the Coast Guard has changed award fee measures to better hold 

the system integrator accountable for ensuring effective integrated product 

teams. Award fee criteria have been expanded to incorporate administration, 

management commitment, collaboration, training, and empowerment of these 

teams. GAO reported that the Coast Guard has taken steps to implement the 

recommendations, however it is too early to determine the effectiveness of 

these efforts. 

As part of our ongoing responsibility to assess the efficiency and effectiveness 

of departmental programs and operations, we conducted an audit of the Coast 

Guard’s Deepwater information technology. The objectives of our audit were 

to evaluate the effectiveness of Coast Guard efforts to identify C4ISR systems 

requirements, and to determine how well these systems are being 

implemented to support the Deepwater program. The scope and methodology 

of this audit are discussed in Appendix A. 

Results of Audit 

System Development Approach Could Be Improved 

The Coast Guard’s efforts to develop its Deepwater C4ISR systems could be 

improved. Although agency officials are involved in high-level Deepwater 

requirements definition processes, they have limited influence over the 

decisions that the contractor makes toward meeting those IT requirements. 

Due to a lack of discipline in adhering to systems requirements change 

management processes, there is little assurance that the requirements are 

complete or effective in meeting program goals. Ensuring consistent 

certification and accreditation of Deepwater C4ISR equipment has been 

difficult to achieve, thus placing systems security and capabilities at risk. 

Further, although the Deepwater program has established procedures for IT 

4 Preliminary Observations on the Condition of Deepwater Legacy Assets and Acquisition Management Challenges, U.S. 

Government Accountability Office (GAO-05-307T, April 20, 2005). 5

 Changes to Deepwater Plan Appear Sound, and Program Management Has Improved, but Continued Monitoring Is 

Warranted, U.S. Government Accountability Office (GAO-06-546, April 2006). 

Improvements Needed in the U.S. Coast Guard’s Acquisition and 

Implementation of Deepwater Information Technology Systems

Page 6 
testing, the contractor has not consistently applied these procedures to ensure 

effective performance of C4ISR systems and the assets on which they are 

installed. 

Requirements Definition Process Not Fully Effective 

Office of Management and Budget Circular A-11 establishes policies for 

planning and managing IT investments to ensure that funds expended achieve 

intended benefits.6 Specifically, a supplement to the circular directs agencies 

to reduce project risk by involving stakeholders in the definition of 

requirements and the design of IT assets to meet mission needs.7 While Coast 

Guard officials are involved in initial requirements definition processes at an 

operational level, the users have little input into subsequent efforts to identify 

the Deepwater IT systems needed to meet those requirements. Instead, the 

contractor has sole responsibility for determining systems functionality at the 

next level, and outlining the steps toward implementing the systems in line 

with the functional requirements. 

The Coast Guard has a structured process in place to help support Deepwater 

requirements definition (see Figure 3). The process begins when the Office of 

Response, considered the Deepwater program sponsor, provides a mission 

needs statement for approval by senior DHS and Coast Guard management. 

Deepwater program officials provided the initial mission needs statement for 

approval in 1996, but subsequently updated it in 2000 and 2005 to address 

increased homeland security needs since the September 11, 2001, terrorist 

attacks. The mission needs statement broadly outlines high-level 

requirements to align the Deepwater program with the department’s mission, 

vision, and strategic goals. After the DHS Deputy Secretary signed the 

mission needs statement, the Coast Guard was authorized to develop 

technology to meet its Deepwater program requirements. 

Deepwater officials subsequently divided the overarching program 

requirements into various functional areas, such as the C4ISR domain. The 

first step in breaking down Deepwater C4ISR requirements entailed producing 

a system performance specification document based on the mission needs 

statement. This system performance specification document, created by Coast 

Guard officials, discussed the high level operational capabilities that it expects 

the technology to provide. For example, the command and control system 

6

 Circular A-11, Part 7, Planning, Budgeting, Acquisition, and Management of Capital Assets, Executive Office of the 

President, Office of Management and Budget, June 2005. 7

 Capital Programming Guide, version 1.0, supplement to Circular A-11, Executive Office of the President, Office of 

Management and Budget, July 1997. 

Improvements Needed in the U.S. Coast Guard’s Acquisition and 

Implementation of Deepwater Information Technology Systems

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shall provide tools for developing operational mission and crisis action plans 

to assist in prioritizing and adjusting the use of available assets. 

Further, the Deepwater contractor mapped the operational capabilities 

document to a system requirements specification document that it created, 

outlining the specific technologies and functions that it planned to provide to 

meet the contract requirements. Subsequently, the contractor divided its 

system requirements specification document into several C4ISR “asset 

performance specifications documents,” defining the hardware and software 

requirements for each Deepwater asset (e.g., ship or aircraft). Working 

through this structured process, the Coast Guard has been able to trace its 

Deepwater program requirements, at least at a high level, back to the 

department’s strategic homeland security goals. 

System 

Requirements 

Specification 

C4ISR Asset 

Performance 

Specification 

Requirements Definition 

Operational 

Concept and 

Mission Analysis 

Architecture 

Definition 

System 

Requirements 

Definition 

Functional 

Definition 

Hardware/ 

Software Definition 

System 

Performance 

Specification 

Figure 3: Requirements Definition Process 

However, beyond this process, the contractor has principal authority to further 

define system requirements and the steps needed to meet those requirements. 

Per the Deepwater contract, many IT requirements documents do not require 

prior Coast Guard approval. For example, according to one contract official, 

the contractor generally gives the Coast Guard 30 days to review documents. 

However, because of a shortage of personnel to conduct the document 

reviews, the agency has difficulty responding within that time frame. By the 

time that the Coast Guard is able to review the documents, the contractor has 

moved ahead with its plans to keep on schedule. One Coast Guard official 

stated that the agency must then either accept the work that the contractor has 

performed or submit a change request, which may require additional funding. 

Improvements Needed in the U.S. Coast Guard’s Acquisition and 

Implementation of Deepwater Information Technology Systems

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Initially, when the contractor presented the C4ISR increment one test and 

evaluation program plan to the Coast Guard, agency officials identified 

deficiencies with the plan and did not accept it. These deficiencies included 

inadequate explanation of C4ISR increment one domain level testing, no test 

schedule, and inadequate requirements traceability to the test events. After 

the contractor submitted the test and evaluation program plan a second time 

with revisions, Coast Guard officials were forced to accept the document due 

to schedule pressures. Nonetheless, Coast Guard officials commented that 

several corrections still needed to be made to the document, but they were 

minor and likely would not impinge on program areas such as scheduling or 

performance specification completion. 

Per contract agreements, the contractor also controls the integrated product 

teams formed to provide cross-representational input to Deepwater program 

requirements. These teams serve as a venue for discussing specific C4ISR 

issues and technologies. Although the teams are comprised of contractors and 

Deepwater program and operational staff, the ultimate authority for the teams 

rests with the chairperson who is a contractor. As such, the contractor drives 

the discussions regarding fundamental program requirements and controls the 

technology change decisions forwarded for implementation. In response to 

our draft report, Coast Guard officials noted that since 2005 they have taken 

steps to address these issues concerning integrated product team involvement 

in the requirements definition process. Specifically, they said that Coast 

Guard representatives now participate on all four integrated product teams to 

help formulate contractor decisions toward meeting IT requirements. Coast 

Guard representatives also participate in Technical Solution Reviews hosted 

by the contractor. 

Lack of Discipline in Requirements Change Management 

According to federal guidelines, IT architectures should be used to guide 

changes for new and operational systems.8 Failure to follow effective change 

management or configuration management processes can lead to systems 

availability problems. Specifically, the Gartner Group, a leading provider of 

IT industry research and analysis, reports that an average of 80 percent of 

unplanned systems downtime is caused by people and process issues, 

including poor change management practices.9 Enterprises that have strong 

change management practices typically have the highest levels of systems 

availability. 

8

 Memorandum 97-16, Information Technology Architectures, Executive Office of the President, Office of Management 

and Budget, June 18, 1997. 9 NSM: Often the Weakest Link in Business Availability, Gartner, Inc., July 3, 2001. 

Improvements Needed in the U.S. Coast Guard’s Acquisition and 

Implementation of Deepwater Information Technology Systems

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The Deepwater program faces a constant challenge in ensuring adherence to 

its process for submitting, reviewing, approving, and implementing changes to 

systems requirements to ensure that they remain up-to-date and effective in 

meeting program goals. There are at least two types of systems requirements 

changes—those affecting high-level operational requirements and those 

affecting functional capabilities. Deepwater integrated product teams or Coast 

Guard officials responsible for managing the C4ISR domain can only 

recommend changes to functional requirements. A Deepwater program 

sponsor is required to initiate all changes to operational requirements, which 

then must be approved by the Coast Guard’s acquisition executive for further 

consideration. 

In either case, the requirements changes must be cleared through the 

contractor’s peer review process and then presented for discussion at an 

engineering technical review. Following the engineering technical review, the 

changes are forwarded to the Deepwater Specification Change Review 

Implementation Baseline and Evaluation board, where the contractor and the 

Coast Guard discuss the new or revised requirements. Upon approving the 

requirements change, the board also determines the associated cost and 

submits the change request to a joint change control board for review; the 

C4ISR asset piece back document is then modified. If the board disapproves 

the requirements change, the request is placed in a holding file for discussion 

at a later date. 

A number of Coast Guard officials stated that this requirements change 

process is not always followed. One official stated that some people 

circumvent the process by requesting changes directly of the contractor staff 

on site. For example, one Deepwater C4ISR official told us that if changes 

are needed to the National Security Cutter being built in Pascagoula, 

Mississippi, the Coast Guard staff there will talk directly to the contractors on 

site to obtain the changes rather than seek approval through the program 

office. A C4ISR official expressed concern at sometimes not learning about 

the changes made by the surface domain until the contractor requests payment 

for the deviations, which can lead to potential cost and schedule overruns 

without Coast Guard management’s awareness. 

Several critically needed changes to the C4ISR approach and requirements 

have been overlooked. A number of Coast Guard officials stated that some 

C4ISR requirements, which were identified after September 11, 2001, have 

not been introduced into the Deepwater program. For example, the contractor 

continues to focus on the original requirement to use the automatic 

identification system to ensure safety of life at sea rather than the exchange of 

sensitive but unclassified tactical information, as more recently directed by the 

Coast Guard. Because of the delay in implementing such requirements 

Improvements Needed in the U.S. Coast Guard’s Acquisition and 

Implementation of Deepwater Information Technology Systems

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changes, the Coast Guard may not have what it needs to meet its post 9-11 

homeland security missions. 

Similarly, one Coast Guard official stated that requirements generated from a 

Deepwater program performance gap analysis, directed by the Commandant 

in 2003, have not been implemented. The report resulting from the gap 

analysis states that, although the Deepwater concept of operations stresses 

interoperability, it does not outline plans for ensuring that both technical and 

operational interoperability requirements are met. For example, technical 

interoperability requirements for items such as sensors, radios, and radar are 

covered; however, there are few clear examples of how the various Deepwater 

assets equipped with the C4ISR systems will work together. This lack of 

clarity can hinder seamless interoperability between Deepwater systems and 

other key initiatives, such as the Coast Guard’s “Rescue 21” command, 

control, and communications system. Additionally, the interoperability 

discussion in the Deepwater concept of operations is Coast Guard-centric and 

does not address interoperability with other DHS components or the 

Department of Defense. 

At times, Coast Guard policy modifications can necessitate involuntary 

changes to Deepwater C4ISR systems design to ensure continued 

interoperability across agency assets. The Coast Guard decided to implement 

the Automatic Messaging Handling System at its Communications Area 

Master Stations instead of adopting a messaging system that the Deepwater 

program was in the process of acquiring. As a result, the Deepwater program 

had to switch to using the same system so that its assets could continue to 

communicate with other Coast Guard components. This change may affect 

not only the design of the Deepwater C4ISR system but the contract cost and 

schedule as well. 

Systems Certification and Accreditation Issues 

Federal guidelines require that agencies establish processes to authorize and 

ensure the security of the IT systems that they implement.10 As part of these 

processes, IT systems must undergo certification and accreditation—a riskmanagement framework for meeting federal information security 

requirements.11 Certification and accreditation is comprised of four distinct 

phases: systems initiation, security certification, security accreditation, and 

continuous monitoring. Each phase in the process consists of a set of welldefined tasks including testing, inspections, and documented agreements 

10 Federal Information Security Management Act of 2002 (FISMA), Public Law 107-347, Title III, December 17, 2002. 11 Guide for the Security Certification and Accreditation of Federal Information Systems, National Institute of Standards 

and Technology, Special Publication 800-37, May 2004. 

Improvements Needed in the U.S. Coast Guard’s Acquisition and 

Implementation of Deepwater Information Technology Systems

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among responsible authorities. Three types of accreditation decisions can be 

rendered at the end of the process: authorization to operate, interim 

authorization to operate, or denial of authorization to operate. The Deepwater 

contractor is required to build, test, and implement computer systems in 

compliance with the Department of Defense Information Assurance and 

Defense Information Technology Security Certification and Accreditation 

Process (DITSCAP) to ensure that they achieve authorization to operate. 

However, achieving such authorization has proven difficult for Deepwater 

C4ISR systems. For example, the contractor is having problems achieving 

authorization to operate the new Coast Guard command and control system 

being installed at the District 7 Miami shore site. The system underwent 

several vulnerability scans and failed because it was not built in accordance 

with DITSCAP guidelines. Because of the unmitigated vulnerabilities, 

Deepwater program officials have not been able to present the system to the 

Coast Guard’s Secret Internet Protocol Router Network (SIPRNET) 

Management Office and receive authorization to operate. The system must 

achieve a minimal, accepted level of risk before it can be approved and put 

online. The delay in making the new C4ISR suite operational has had a ripple 

effect, delaying system implementation at other shore sites and on assets. 

Similarly, the Deepwater program initially experienced problems in certifying 

and accrediting the command and control system that the Coast Guard uses on 

its 123-foot patrol boats. A version of the system received authorization to 

operate while the contractor worked to address the minor vulnerabilities 

identified. However, despite creating additional system versions to try to 

mitigate the vulnerabilities, the contractor was not successful and therefore 

these other versions could not receive final authorization to operate. In April 

2006, the SIPRNET Management Office informed Deepwater program 

managers that, unless the vulnerabilities were addressed within 45 days, 

access to SIPRNET would be revoked. To assist the contractor in meeting the 

deadline, the Coast Guard provided a “best practice” software development 

process that other agency units use to meet DITSCAP requirements for 

deploying their systems. The contractor aligned its software development 

approach with these best practice guidelines and, in May 2006, achieved 

authorization to operate a new version of the command and control system on 

its 123-foot patrol boats. 

This command and control system installed on the 123-foot patrol boats 

constitutes the baseline for the core C4ISR system currently being deployed at 

Coast Guard shore facilities. This core C4ISR system, in turn, constitutes part 

of a larger C4ISR system, which will be installed on other Deepwater assets, 

such as the National Security Cutter. Because it has many components, 

successfully accomplishing certification and accreditation for the National 

Improvements Needed in the U.S. Coast Guard’s Acquisition and 

Implementation of Deepwater Information Technology Systems

Page 12 
Security Cutter’s C4ISR equipment will be especially difficult. As such, the 

contractor expects to apply the lessons learned in achieving certification and 

accreditation for the command and control system to its broader Deepwater 

system deployment efforts. A number of Coast Guard officials emphasized 

the need to successfully certify and accredit the core system to avoid the risk 

of losing SIPRNET capability, which is critical for all of Deepwater’s 123-

foot patrol boats and legacy cutters. Such secure connectivity allows 

Deepwater assets to coordinate missions quietly without radio chatter and 

sneak up on their targets without revealing their positions. 

Inadequate Systems Testing 

According to federal regulations, agencies are responsible for ensuring 

effective and efficient operation of IT equipment.12 This entails proving that 

new systems function properly in a “production-like” test environment and 

contain needed safeguards. 

While the Deepwater program has established a process for systems testing, a 

number of Coast Guard officials believe that this process could be improved. 

The contractor uses the four following methods to test Deepwater C4ISR 

systems: 

• Analysis, to determine if the system meets performance requirements. 

• Inspection, to verify with the five human senses that the system has been 

assembled correctly. 

• Demonstration and follow-up, to ensure that the system is working 

correctly. 

• Final testing, to verify functionality with real life data analysis. 

The contractor may not use all four procedures to test each system; rather, the 

contractor has the authority to determine which method or combination of 

methods will be used. In general, the testing completed by the contractor 

takes place at the Maritime Domain Awareness Center in Moorestown, New 

Jersey and its supporting laboratories. 

Our review disclosed problems with the simulation equipment that the 

contractor uses at the Maritime Domain Awareness Center to perform 

vulnerability scans on C4ISR systems during the demonstration and final 

testing phases. Vulnerability scans using the simulation equipment are to help 

ensure that the C4ISR systems they replicate are compliant with applicable 

security standards. However, several simulator shortcomings may hinder 

12 Office of Management and Budget Circular A-130, Transmittal Memorandum #4, Management of Federal 

Information Resources, November 28, 2000. 

Improvements Needed in the U.S. Coast Guard’s Acquisition and 

Implementation of Deepwater Information Technology Systems

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achievement of this objective. Specifically, Coast Guard officials told us that 

the simulation equipment used for the vulnerability scans has difficulty 

calculating how C4ISR systems work in real situations on cutters or at shore 

sites; the simulators therefore may produce inaccurate results. Further, 

because the contractor has not compared simulator performance to that of real 

C4ISR systems, discrepancies may result when the C4ISR systems are 

deployed to new assets or shore sites. Additionally, the simulation equipment 

has not undergone certification and accreditation to help ensure that it mimics 

the true C4ISR environment. Successfully certifying and accrediting the 

simulation equipment can increase the probability that the real C4ISR systems 

will function properly. While Coast Guard officials recognize the potential 

benefits to certifying and accrediting simulators, the contractor has resisted, 

asserting that to do so would require additional funding. 

Further, although the Navy’s Commander, Operational Test and Evaluation 

Force (COMOPTEVFOR) in Norfolk, Virginia is supposed to play a 

significant role in completing C4ISR testing, its participation in test activities 

to date has been limited. This is an independent group responsible for 

reporting to Deepwater sponsors on the operational capabilities of the C4ISR 

systems implemented by the contractor. Ideally, COMOPTEVFOR should 

have participated in the initial phases of Deepwater C4ISR development to 

help identify possible “faults or concerns” that could affect the operational 

system. Instead, the contractor provided this group access to the C4ISR 

systems only after they were installed on the completed 123-foot patrol boats. 

At that point, it completed operational testing of the systems on the 123s, but 

not on the legacy cutters that also had received portions of the C4ISR 

upgrades. The ensuing report from these operational tests noted problems 

with C4ISR equipment installation, training, and integration with other offthe-shelf command and control systems already installed on the 123-foot 

patrol boats. Also, the report indicated that, with the exception of the 

SIPRNET, the C4ISR systems did not operate as promised to meet Coast 

Guard requirements. 

Recommendations 

We recommend that the Commandant, U.S. Coast Guard, direct the 

Deepwater Program Executive Officer to: 

1. Increase agency input and oversight of the requirements definition 

process to ensure the contractor activities meet program goals and 

objectives. 

2. Clearly define and communicate system requirements change 

management processes to ensure they are consistently used to identify, 

Improvements Needed in the U.S. Coast Guard’s Acquisition and 

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evaluate, and apply changes as appropriate, to Deepwater C4ISR 

requirements. 

3. Ensure that, in line with federal guidelines, the contractor takes steps 

to mitigate security vulnerabilities that have hindered achievement of 

C4ISR system certification and accreditation. 

4. Address shortcomings with simulation equipment and provide the 

access needed to support independent test and evaluation of C4ISR 

systems and equipment to ensure that they operate efficiently and 

securely. 

Deepwater Systems Implementation Challenges 

The Coast Guard faces a number of challenges to implementing effectively its 

Deepwater C4ISR systems. Due to limited oversight, a lack of clarity 

regarding contract requirements, and limited input into selection decisions, the 

agency cannot ensure that the contractor is fully meeting its Deepwater IT 

needs. Insufficient funding of C4ISR and engineering components has 

restricted achievement of integrated “system-of-systems” objectives—the 

linchpin of the Deepwater program. Inconsistent training, inadequate 

instructors, and a lack of reference materials hinder users from realizing the 

full potential of the C4ISR upgrades. And, ensuring effective service and 

support for C4ISR systems and users have been equally challenging. 

Contract Management Structure Limits Oversight and Control 

Although the performance-based Deepwater contract has the potential to 

increase contractor flexibility and reduce costs, it has several drawbacks as 

well. Specifically, due to a lack of funding and experience with performancebased acquisitions, the Coast Guard has not allocated sufficient resources to 

effectively oversee Deepwater contractor activities. Due to a lack of clarity in 

the contract terminology, there is some confusion about contractor 

responsibilities for producing the C4ISR systems, hindering timely and 

effective accomplishment of Deepwater program goals. The contractor has 

considerable autonomy in making Deepwater IT selections, which some 

believe are not always in the best interest of the agency, too. 

Deepwater Contract Structure 

The federal government requires that agencies maximize use of performancebased contracts to acquire services or products. The intent is for agencies to 

describe their needs in terms of what is to be achieved rather than how it is to 

be done, giving the contractor flexibility in the processes and proposed 

solutions toward meeting agency mission needs—and thereby decreasing the 

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total cost of program ownership. Further, interagency guidance on 

performance-based acquisitions states that the contracts should be structured 

in such a manner as to ensure meaningful agency oversight of contractor 

progress toward meeting requirements, milestones, and program goals.13 

Adequate federal resources must be applied effectively to carry out these 

oversight responsibilities. Statements of work pursuant to the performancebased contract also should be clearly written to ensure that contractor 

activities and products deliver intended benefits. 

As previously discussed, in 2002 the Coast Guard awarded a performancebased contract to accomplish its Deepwater program. The Coast Guard 

awarded ICGS the role of prime contractor and overall systems integrator, 

with responsibility for designing, deploying, and integrating all of the air, 

surface, and shore assets and technologies needed for maritime domain 

awareness. Essentially, ICGS is a joint venture between Lockheed Martin and 

Northrop Grumman Ship Systems, with each company serving as first-tier 

subcontractors for the Deepwater program. As such, Lockheed Martin and 

Northrop Grumman Ship Systems can either provide Deepwater assets and 

systems themselves, or award this responsibility to second-tier subcontractors. 

Figure 4 illustrates the contractor relationships. (See Figure 4.) 

U.S. Coast Guard 

(Customer) 

Integrated Coast Guard 

Systems (Integrator) 

Northrop Grumman Ship Systems 

(Tier One Contractor) 

Lockheed Martin System and 

Sensors (Tier One Contractor) 

Tier Two 

Contractor 

Tier Two 

Contractor 

Tier Two 

Contractor 

Tier Two 

Contractor 

Figure 4: Deepwater Contractor Relationships 

13 Seven Steps to Performance-Based Services Acquisition, An Interagency-Industry Partnership in Performance. 

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To help execute the contract, in December 2002 the Coast Guard and ICGS 

signed a partnering agreement, which outlines their respective responsibilities 

and how they will work together to carry out the program. The agreement 

states that the Coast Guard is responsible for managing operational 

requirements; providing a uniform understanding of agency needs, 

perspectives, and constraints; responding to mission demand and 

environmental changes; ensuring contract oversight; and, operating the 

Integrated Deepwater System. Accordingly, the Coast Guard has an essential 

role to play in overseeing program management and ensuring that contractor 

activities are aligned with program goals and objectives. Conversely, ICGS is 

responsible for defining, managing, integrating, and constructing Deepwater 

assets and systems to comprise a single integrated system. As such, the 

contractor is responsible for providing Deepwater solutions and results, but in 

keeping with overarching Coast Guard direction. The goals of the partnering 

agreement include: 

• Maximizing operational effectiveness and minimizing costs. 

• Delivering assets and systems in accordance with prescribed cost, 

schedule, and technical performance objectives. 

• Ensuring a collaborative work environment. 

• Communicating openly and honestly to avoid mistakes and surprises. 

• Managing risks by anticipating and resolving problems promptly. 

• Resolving issues before they escalate. 

Contract Management Staff 

Due to funding limitations and a lack of experience with performance-based 

acquisitions, the Coast Guard has not allocated sufficient resources to 

effectively carry out its responsibility for overseeing the Deepwater contract. 

Coast Guard officials at both the Systems Integration Program Office and the 

Maritime Domain Awareness Center told us of the need for additional Coast 

Guard personnel to provide agency perspectives and oversight by attending 

meetings on Deepwater program management, requirements definition, and 

systems design issues. Also, officials said that additional Coast Guard 

resources are needed to review the large number of contractor plans and 

documents to ensure that contract requirements are being met. For example, 

one official estimated that the ratio of Deepwater contractors to Coast Guard 

program management personnel at the Maritime Domain Awareness Center— 

a primary contractor facility responsible for system development testing—is 

about 20 to 1. Based on years of experience in helping to oversee contractor 

activities at the center, this official said that a ratio of 10 to 1 would be more 

appropriate. 

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Staff currently assigned to Deepwater program management are overworked 

and pulled in many directions to provide coverage. Where staff must act in a 

program oversight capacity in addition to carrying out their direct 

responsibilities, their workloads are overwhelming. Program oversight 

activities include reviewing requirements, developing statements of work, 

overseeing systems installation, conducting training, providing technical 

feedback, and attending meetings at the program office in Washington, DC as 

well as the contractor’s facility in Moorestown, New Jersey. For example, 

one Coast Guard official whom we interviewed serves as a liaison between the 

two locations. This official must travel back and forth to carry out his 

responsibilities for establishing systems policy and direction, promoting 

awareness of program progress, and communicating issues related to 

Deepwater requirements. A program management official questioned the 

impact that such thinly stretched oversight personnel are having on the 

Deepwater program. This official surmised that essential oversight activities 

are likely being overlooked, posing potential risks to successful contract 

accomplishment. 

Further, the prime contractor is not adequately staffed to ensure that the 

subcontractors are fulfilling their obligations. For example, one Coast Guard 

official said that the system integrator has only two individuals working on 

program management issues for the entire C4ISR domain: A C4ISR associate 

program manager responsible for increment one shore assets, and a deputy 

associate program manager responsible for increment one surface and air 

assets. Together, these officials are responsible for overseeing the 

contractor’s costs, performance, and schedule and notifying the Coast Guard if 

there are any problems. However, given the myriad issues related to 

Deepwater C4ISR, realistically they must focus on addressing the highpriority items at the expense of more minor concerns. This staffing limitation 

frustrates Coast Guard program management officials, who sometimes have to 

wait months for issues to be addressed. 

Similarly, the number of subcontractors assigned to carry out specific contract 

activities has not always been adequate. For example, there are only three 

subcontractor representatives located at the Maritime Domain Awareness 

Center with adequate expertise to ensure systems certification and 

accreditation. A Coast Guard official we interviewed believes that the number 

of personnel should instead be between 10 and 15 to cover the wide-ranging 

C4ISR systems that need review and testing. Another official said that this 

lack of technical personnel has contributed to delays in implementing the 

command and control system for District 7. 

Officials said that they believe the contractors are not adequately fulfilling 

their duties because Coast Guard personnel must fill-in and provide support. 

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This workload places additional strain on the already limited number of Coast 

Guard program management and oversight personnel. Officials told us that 

the Deepwater program would be adequately resourced if the prime contractor 

were not acting as both a systems integrator for the overall program, as well as 

a subcontractor with hands-on responsibilities for designing, developing, and 

implementing assets and systems. They said that this arrangement taxes the 

Coast Guard’s resources needed to provide requirements review and systems 

testing, training, and support. 

The Coast Guard has recently taken steps to try to address the lack of 

Deepwater contract management resources. Specifically, in FY 2005, 

program management requested that each program domain examine the 2002 

Deepwater Human Capital Plan and determine whether additional staff was 

needed. Accordingly, C4ISR program managers requested an additional 28 

government and contract staff resources to help with contractor oversight and 

other activities such as system certification and accreditation. In response, 

however, the C4ISR component only received five additional staff and 

remains challenged in its ability to adequately oversee the program. 

Confusion Concerning Contractor Responsibilities 

Due to a lack of clarity in the Deepwater contract and supporting documents, 

there is some confusion about contractor responsibilities in producing C4ISR 

systems. In several instances, the Coast Guard and its contractors have tended 

to interpret the terms of the contract differently, posing hindrances to timely 

and effective accomplishment of Deepwater program goals. Several Coast 

Guard officials stated that the contractor does not fully understand the 

agency’s organization and mission because frequent meetings between the 

contractor and the Coast Guard are required to discuss the meaning of words 

used in the program documentation. 

To illustrate: In November 2003, the Coast Guard provided a letter to the 

contractor stating that, contrary to the concept of operations, satellite 

communications plans did not include SIPRNET connectivity for Deepwater 

cutters operating out-of-hemisphere in ocean regions other than the Atlantic 

and Pacific. In its written response, the contractor disagreed with this 

assertion and stated that the level of connectivity it had provided was in 

keeping with the task order. Further, the contractor stated that the concept of 

operations did not specify when satellite communications for the out-ofhemisphere cutters would be needed. The contractor nonetheless agreed to 

identify alternative solutions for leasing additional satellite connectivity for 

the Coast Guard’s out-of-hemisphere cutters. The contractor reiterated, 

however, that pursuing these alternative solutions was beyond the scope of the 

task order and requested reimbursement for all additional costs. The Coast 

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Guard ultimately agreed because it needed the satellite connectivity to 

communicate and coordinate mission activities with the cutters that were 

operating out-of-hemisphere. In response to a draft of our report, the Coast 

Guard noted that the above letter was written several years ago and that there 

has been tremendous improvement since that time. 

Additionally, many of the systems testing and approval problems previously 

discussed can be attributed to initial difficulty that the Coast Guard had in 

getting the subcontractor to accept responsibility for certification and 

accreditation. From the Coast Guard’s perspective, the Deepwater contract 

assigned the subcontractor responsibility for identifying and assessing C4ISR 

systems vulnerabilities, as well as providing software security updates. 

However, according to a Coast Guard official, the subcontractor believed that 

it was only responsible for providing a “certifiable” system that could pass 

certification and accreditation requirements at a later date. The subcontractor 

initially asserted that the Coast Guard would incur additional costs if it were 

to require changes to contractor procedures for developing software as a 

means of ensuring that the security requirements could be met. However, 

after a Coast Guard contracting officer provided written guidance in April 

2006, the subcontractor was able to provide a certifiable system for the 123-

foot patrol boats. 

Finally, the Coast Guard has a responsibility to oversee the contractor’s 

processes for accomplishing contract goals and deliverables; however, it has 

been difficult to get the contractor to provide such a window into its 

operations. For example, the contractor recently completed a C4ISR 

operating system scan, which identified security vulnerabilities. The 

contractor stated that it could not resolve the vulnerabilities without causing 

the system to lose functionality. When the Coast Guard asked for more 

details, the contractor resisted, stating that it was not required by the contract 

to provide such information. In May 2006, however, a Coast Guard official 

stated that the contractor was working to provide the requested information. 

Contractor Decisions May Not Meet Agency Needs 

By limiting the Coast Guard’s role in determining contractor processes and 

solutions, the performance-based Deepwater contract is intended to promote 

contractor flexibility and success toward achieving program goals. However, 

the contract has a number of drawbacks as well. Specifically, it gives the 

contractor considerable autonomy in selecting the systems and equipment it 

believes will fulfill performance objectives outlined in the statement of work. 

Under ordinary circumstances, this arrangement can prove beneficial. 

However, officials were concerned that the two parties to the joint venture, 

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who serve as subcontractors for the program as well, lack the independence 

needed to make objective decisions in the best interest of the Coast Guard. 

In purchasing its Automatic Identification System, for example, the contractor 

selected a vendor other than the one that the Coast Guard already uses to 

provide similar functions for its non-deepwater fleet. A Coast Guard official 

suggested that the decision was based more on the fact that the vendor was 

under contract than on the superior capabilities or competitive costs of its 

system. Similarly, the Deepwater contractor selected a brand of radios that 

may not be interoperable with other brands of radios used by other 

government agencies. In a recent survey, one Coast Guard official expressed 

concerns that the Deepwater contractor typically exerts little effort to ensure 

that the IT products it selects are aligned with the rest of the agency. Using 

different brands of equipment with different operating procedures and 

requirements can lead to increased risk that Coast Guard users will not be able 

to communicate effectively, in addition to causing problems in providing IT 

training, support, and spare parts in the long-term. Such disparities also create 

a divide between Deepwater and non-Deepwater assets, making it difficult for 

Coast Guard personnel to transition from one asset to another without having 

to be retrained on different equipment. 

In its March 2004 report, GAO discussed issues related to the lack of 

competition and contractor independence in deciding on Deepwater 

acquisitions.

14 Specifically, it reported that the two subcontractors comprising 

the joint venture have sole responsibility for determining whether to hold 

competitions for Deepwater assets or to provide the assets themselves. GAO 

stated that over 40 percent of the funds obligated to the two subcontractors 

have remained with those companies or been awarded to their subsidiaries. 

Further, GAO noted that the Deepwater systems integrator uses a sourcing 

document developed by one of its subcontractors to guide competition 

decisions made by the subcontractors. However, this guidance is a 

philosophy—not a formal process involving specific actions—which 

encourages competition, but does not require it. GAO concluded that the lack 

of transparency into significant make or buy decisions, and the government’s 

lack of a mechanism to hold the contractor accountable, raise questions about 

whether the Coast Guard will be able to control costs. GAO found that as of 

September 30, 2003, Lockheed Martin planned to retain 42 percent of its 

obligated dollars and to award 58 percent to second-tier subcontractors. In 

response to our draft report, the Coast Guard stated that it had hired a 

contractor to assess the extent of second-tier competition conducted by the 

prime contractor, as a means of addressing the GAO recommendations. The 

14 GAO-04-380, March 2004. 

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contractor provided nine suggestions for addressing the GAO 

recommendations, of which the Coast Guard has implemented eight. 

C4ISR and System Engineering Funding 

Office of Management and Budget Circular A-130 directs federal agencies to 

develop information systems that facilitate interoperability across networks of 

heterogeneous hardware, software, and telecommunications platforms. IT 

planning to achieve these objectives should be linked to expected program and 

mission needs, reflect budget constraints, and form the basis for budget 

requests. 

As previously discussed, the Deepwater “system-of-systems” approach is 

intended to deliver a package of C4ISR systems across all of the program’s 

new or upgraded sea, air, and shore assets. The approach involves enhanced 

command and control systems as well as a streamlined logistics structure to 

support a layered defense of major cutters, patrol boats, helicopters, 

unmanned aerial vehicles, and maritime patrol aircraft—all connected using a 

single command and control architecture. The C4ISR capabilities comprise a 

fundamental building block toward providing the interoperability, situational 

awareness, and communications needed to detect, intercept, and interdict 

potential threats in the maritime domain. This integrated “mix of forces” 

solution, including minimal development of assets and, wherever possible, 

procurement of state-of the-art products and technologies, is a departure from 

traditional one-for-one asset acquisition programs. Engineering support for all 

design, test, and production activities is key to ensuring a fully integrated 

Deepwater system. Engineering teams are responsible for performing the 

necessary analysis and tradeoffs, recognizing when interface impacts might 

occur, and taking early action to avoid integration problems. 

However, insufficient funding for C4ISR and systems engineering and 

integration components of the Deepwater program has restricted achievement 

of the intended “system-of-systems” approach. While Deepwater is an 

essential acquisition, it faces the same budget realities as other federal agency 

programs. Specifically, each year the Office of Management and Budget 

requires that the Coast Guard include full funding for the Deepwater program 

in its agency-wide capital plan. However, whereas the President’s budget 

request for the C4ISR program in FY 2006 was about $74 million, the Coast 

Guard only received approximately $44 million—about $30 million less than 

the amount that the Coast Guard said it needed to achieve its FY 2006 C4ISR 

objectives. 

Due to the reduced level of funding in FY 2006, the Coast Guard has been 

hindered in accomplishing some C4ISR initiatives as scheduled. For example, 

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detailed design and development activities for C4ISR increment two have 

been delayed by at least three months. This, in turn, has resulted in a delay in 

implementing enhanced maritime domain awareness capabilities across all 

Deepwater assets by approximately one year. The President has requested 

approximately $61 million for Deepwater C4ISR in FY 2007. 

In conjunction with these C4ISR funding reductions, the systems engineering 

and integration component responsible for supporting accomplishment of 

Deepwater “system-of-systems” objectives has been under-funded, too. 

According to the International Council on Systems Engineering, such 

expenditures should constitute about 10 to 15 percent of a program’s budget. 

However, Deepwater systems engineering and integration funding has 

declined each year since the program’s inception, from a high of 20 percent of 

the overall budget in FY 2002 to four percent in FY 2006. Without adequate 

funds for engineering to support C4ISR systems integration, the risk is 

increased that newly acquired air and surface assets may not provide the 

interoperability across assets or the other capabilities that the Coast Guard 

needs to perform its mission. Further, where adequate resources are provided 

for Deepwater systems engineering and integration activities, there is greater 

potential for increased product quality, reduced costs, and shorter program 

schedules. 

Inadequate User Training 

Office of Management and Budget Circular A-130 requires that users of 

federal information resources have the skills, knowledge, and training they 

need to manage information resources, enabling the federal government to 

serve the public through automated means. Similarly, the Clinger-Cohen Act 

of 1996 states that agencies are responsible for ensuring that IT users receive 

the training that they need to effectively perform their jobs.15 The Deepwater 

challenge to train personnel to operate effectively the new and upgraded 

C4ISR equipment in line with these requirements has been considerable. 

However, given inconsistent and untimely training, a lack of knowledgeable 

instructors, and inadequate reference materials, the program has not 

effectively met this challenge. Unless the Coast Guard addresses these 

training deficiencies, users may not be able to maximize the potential of the 

C4ISR equipment provided through the Deepwater program. 

Training Not Timely 

The Deepwater program has not fully ensured that users receive timely 

instruction on operating new or upgraded C4ISR equipment. The primary 

15 Division E of Public Law 104-106. 

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strategy has been to offer “just-in-time” training, which entails providing 

informal, hands-on instruction to users shortly after systems are implemented 

on the various surface and shore assets. Because of a lack of funding, the 

program has not established “pipeline” training—a series of required courses 

and continuing education—to instruct new or incoming crewmembers on how 

to utilize C4ISR systems. In response to our draft report, the Coast Guard 

agreed that funding constraints have limited training, but the contractor is 

meeting funded contractual requirements nonetheless. 

According to a number of Coast Guard crews, this lack of pipeline training is 

a problem particularly for staff transitioning from one assignment to the next. 

There is a general expectation that incoming staff will quickly learn to operate 

the C4ISR equipment, even though they do not receive any formal training. 

Whereas learning C4ISR user skills “on-the-fly” may be easy for technically 

savvy crewmembers, it is more difficult for those that are not accustomed to 

operating sophisticated IT equipment. Users who receive “just-in-time” 

C4ISR training usually are expected to ease the transition for incoming 

crewmembers by informally training them to use the upgraded IT equipment; 

however, this is not always effective. Deepwater program officials typically 

do not revisit assets to train crewmembers that were not present at the time of 

initial “just-in-time” training. 

The combined “just-in-time” and “train the trainer” strategy has several 

additional limitations. For example, there is no helpdesk number to call for 

follow-on assistance with the equipment after the “just-in-time” training has 

been completed. Further, as the Deepwater program has evolved, there have 

been fewer upgraded assets and therefore fewer people trained who have the 

potential to provide informal instruction for incoming staff. According to an 

April 2005 report by COMOPTEVFOR, not enough Coast Guard personnel 

received “just-in-time” C4ISR training to serve as instructors for new 

crewmembers who arrived on 123-foot patrol boats later in the year.16 The 

review indicated that, as a result, it would be difficult for boat crews to sustain 

institutional knowledge and pass that knowledge on to relief personnel over 

the long-term. 

Additionally, because the “just-in-time” approach involves providing training 

in a piecemeal fashion, users can either forget what they learned about 

component parts from earlier training, or not fully understand how the C4ISR 

equipment works together as a whole. District 7 Command Center personnel 

are required to receive 16 hours of training on Deepwater upgrades. However, 

as of April 2006, they had received only eight hours because all C4ISR 

16 Update of the 123-foot Patrol Boat Operational Assessment Analysis Report of September 29, 2004, Department of the 

Navy, Commander, Operational Test and Evaluation Force, April 27, 2005. 

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training cannot be completed until the entire system becomes fully 

operational. Unless the system goes online soon, it may be difficult for 

District 7 users to link prior training to any future instruction that they receive 

on the completed system. 

Unlike the Deepwater program, the Command and Control Engineering 

Center—a Coast Guard center of excellence—offers pipeline training. Such 

training is centered on one Deepwater C4ISR component—the Command 

Display and Control Integrated Navigation System—to help ensure that users 

fully understand the upgrade. This training includes four days of formal 

instruction on a laptop computer, one day of shipboard training, and two or 

three days of training while at sea. Center officials are available for additional 

training, as crewmembers need it. A number of Coast Guard officials believe 

that Deepwater would benefit from adopting a similar approach to training. 

Inadequate Contract Trainers 

A number of Coast Guard officials told us that the contractors hired to provide 

“just-in-time” training are not well versed on the Deepwater C4ISR systems. 

The officials said that the training that the contractors provide is minimal in 

comparison with what the Coast Guard might provide on similar upgrades: 

for example, it might consist of the contractor briefly reviewing features of the 

equipment but without providing hands-on instruction. They said the 

contractors tend to focus on technical and operational aspects of the systems 

but do not address how to apply the technology to the Coast Guard mission 

effectively. Additionally, they said that the training provided by the 

contractor could be clearer and more understandable. 

Further, Coast Guard officials expressed concern that the contract trainers 

have little concept of how the various C4ISR upgrades link together. Officials 

said that the contractors provide training on the individual component systems 

in a piecemeal fashion and seem unsure of how the C4ISR package is 

supposed to function as a whole. For example, one Coast Guard official 

mentioned that training on a tactical component of the overall C4ISR system 

was covered very quickly and only addressed basic concepts. This official 

said that contract trainers provided no explanation as to how this component 

fits within the overall C4ISR design. Because they received no hands-on or 

operational training, crewmembers had to make do and read the instruction 

manual to learn to use the system on their own time, taking them away from 

their regularly assigned duties. The Coast Guard official suggested that, 

without adequate operational training, crewmembers might not be able to 

utilize the equipment effectively to meet their C4ISR needs. 

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Because contractor trainers are not always knowledgeable or available to 

provide C4ISR guidance to crewmembers, Coast Guard officials sometimes 

must assume these responsibilities. One Coast Guard official has been 

assigned informally to provide hands-on C4ISR training on the 123-foot patrol 

boats as well as carry out his primary duties, which include program 

management, contract oversight, and system testing. Trainees also regularly 

call this individual directly to ask follow-on questions, instead of contacting 

Deepwater trainers. Trainees have found this individual to be more helpful 

than some contractors in providing guidance on how to apply C4ISR 

technology to Coast Guard missions and scenarios. 

Figure 5: USCGC MATAGORDA, 123-Foot Patrol Boat 

Lack of Training Guidance 

The Deepwater program offers limited reference materials to support C4ISR 

users. Various training guides, which include systems operating instructions, 

diagrams, troubleshooting advice, and references, have been published but are 

not available on all cutters, especially some of the 123-foot patrol boats. (See 

Figure 5 for a photograph of one such boat.) Crewmembers on one cutter 

used the training guides at one point and found them very helpful. Other 

documentation, such as Logistics Information Management System (LIMS) 

and C4ISR operating manuals, also are available, however a Coast Guard 

official described the latter as “pretty bad.” This official indicated that the 

descriptions, terminology, and layouts of the manual differed from typical 

Coast Guard guidance, making it difficult to use. Similarly, other users said 

that the reference materials are very basic and do not address many of the 

issues that they encounter in using the software. At times, users have to call a 

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Capabilities of C4ISR Equipment Not Maximized 

Deepwater site representative, who phones the help desk, which in turn 

contacts a contractor technician, for support. The contractor is supposed to 

return the user’s call within a few hours, but officials said that this rarely 

happens so obtaining assistance can be a time consuming process. 

One Coast Guard official said that although some parts of the agency often 

prepare quick reference cards for users on how equipment operates, the 

Deepwater program has not done so. A crewmember on one cutter is using 

his spare time to prepare such cards to help his colleagues address issues that 

they encounter when operating the upgraded C4ISR equipment. 

Users Do Not Maximize Capabilities of C4ISR Equipment 

Given the weaknesses in its training approach, the Coast Guard may not be 

able to maximize all of the potential uses of the C4ISR equipment provided 

through the Deepwater program. Personnel whom we interviewed generally 

provided positive feedback on the upgraded systems, but expressed concerns 

about not receiving adequate training or guidance. They indicated that the 

combined “just-in-time” and “train the trainer” method—whereby some users 

receive instruction directly from contract trainers, some get this information 

second-hand, and others are self-taught—has resulted in inconsistent user 

knowledge and ability to operate the C4ISR equipment. Where crewmembers 

have to figure out on their own how to use the new software, it can be very 

time consuming. For example, it sometimes takes Coast Guard personnel up 

to 15 minutes to connect to and utilize the SIPRNET capability provided to 

Deepwater assets. This is too long, especially when they are at sea, tracking 

illegal “go-fast” boats, which could possibly land on U.S. soil before network 

connections are established. 

Further, many users are unaware of or unable to fully utilize C4ISR 

capabilities because they have not been trained on all of the component 

systems. For example, a crewmember on one cutter that we toured was 

overwhelmed with the number of C4ISR upgrades and was never able fully to 

learn to operate the security cameras; he could focus only on operations gear 

instead. Further, this official said that given the lack of training, he has not 

learned to use SIPRNET or the common operating picture and therefore 

cannot maximize their capabilities. Unless the Coast Guard takes steps to 

address these training deficiencies as it deploys additional assets, the problems 

with untrained C4ISR users and unused capabilities may only worsen. 

The Coast Guard recognizes that it has a long way to go to provide adequate 

training. For example, crewmember training on using C4ISR equipment and 

LIMS was one of the critical issues that COMOPTEVFOR addressed in its 

review of 123-foot patrol boat operations. In its April 2005 report, 

Improvements Needed in the U.S. Coast Guard’s Acquisition and 

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COMOPTEVFOR stated that systems training was inadequate; there were 

many areas where crewmembers received no training at all. Also, 

COMOPTEVFOR found a lack of formal on-board training programs, lesson 

plans, training handouts, and standards to certify personnel on use of the 

equipment. COMOPTEVFOR indicated that while “just-in-time” training 

might prove adequate for current crews, the lack of pipeline training for 

incoming crews and support personnel was a problem. Based on these 

findings, COMOPTEVFOR identified 123-foot patrol boat training as a highrisk area that, if not mitigated, could adversely affect the effectiveness and 

safety of onboard operations. 

The Deepwater program has recently issued a broad industry-wide 

announcement seeking innovative training technology to better support 

program operations. It has requested information on best practices, new 

products and techniques, and distance learning initiatives and services that can 

help reduce costs and enhance the Deepwater training approach. In addition, 

the program is constructing a facility in Petaluma, California that will offer 

training on C4ISR equipment. This training facility, due to be completed in 

2006, is expected to provide C4ISR training for crewmembers of the soon-tobe deployed National Security Cutter. 

Inadequate IT Support 

Office of Management and Budget Circular A-130 requires that agencies 

provide mechanisms to support IT equipment and keep it operational after 

implementation. The Deepwater prime contractor’s approach to upkeep of the 

new and upgraded C4ISR equipment has been ineffective. In addition to 

providing technical and engineering services during system testing, 

integration, and installation, the contractor is responsible for correcting 

hardware and software deficiencies, systems documentation, and continuously 

updating the configuration baseline. To this end, the contractor has instituted 

an Integrated Logistics System, which constitutes its management approach to 

supporting, maintaining, and ensuring a supply chain for surface and shore 

assets. An Integrated Logistics Support team helps ensure that all Deepwater 

assets have adequate parts, training, manuals, and maintenance procedures in 

place to support the Coast Guard mission. 

The Integrated Logistics Support team uses LIMS (a web-based tool) to track 

requests and exchange information regarding system repairs and replacement 

parts. C4ISR users can call a toll-free number or log directly into LIMS to 

make their requests for technical support, though it sometimes can take 3-4 

days to receive a response. Via LIMS, users can obtain information about 

assets that might be able to provide the spare parts they need, too. For 

example, if the executive officer on one cutter needs a part that is not in stock, 

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this official might access LIMS to see if another vessel has that part available. 

Currently, only crewmembers on the 123-foot patrol boats can access LIMS, 

although there are plans to extend access to other units across the Coast 

Guard. 

The contractor’s Integrated Logistics Support approach, although helpful, has 

not been adequate. A number of officials told us that the Deepwater 

contractor does not provide a level of assistance comparable to the high-level 

service they are accustomed to receiving from Coast Guard IT support 

personnel. Generally, officials said that they need better service, on site 

technical support, and quicker repairs and parts replacement. They said that, 

prior to Deepwater, cutters received support from Electronic Support Units 

and other Coast Guard teams, which were located on Coast Guard installations 

and therefore were more responsive. The Deepwater contract, however, 

prevents these Coast Guard units from servicing C4ISR upgrades on surface 

and shore assets. Officials in the Electronic Support Units also lack 

knowledge and training on how much of the installed C4ISR equipment 

operates. Coast Guard personnel must rely on the Deepwater approach, which 

generally has been slower and less efficient than the Electronic Support Units 

in providing C4ISR service. 

Specifically, the Deepwater program’s “just-in-time” approach of generally 

waiting to accumulate multiple requests from a given location before 

providing C4ISR support or replacement parts has not been effective. The 

delays until contractor support arrives on site can impede operational 

efficiency and mission accomplishment. For example, on one patrol boat, the 

Coast Guard command and control system has not been operational in over a 

year because the contractor has not come out to repair it. Further, 

crewmembers on a different patrol boat told us that their C4ISR equipment 

kept shutting down unexpectedly, requiring that they restart the entire system 

every 10-15 minutes to keep it up and running until contractor representatives 

could arrive to fix the problem. This was especially difficult at night when, 

for stealth reasons, the cutter conducted maritime security patrols without 

lights. Crewmembers often found themselves in the precarious position of 

losing their night vision when returning to the darkened bridge from the 

brightly lit rooms below deck where the C4ISR equipment was located. 

Further, contractor difficulty in locating spare parts adds to delays in 

providing C4ISR service. This is especially problematic for certain types of 

assets. Although replacement parts for the new national security cutter are 

generally available, spares for the legacy 123-foot patrol boats are logistically 

harder to obtain. Parts are required not only for the 123-foot patrol boat, but 

also for the short range prosecutors that they transport and use to intercept and 

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board suspect vessels. Figure 6 provides a picture of a short range prosecutor. 

(See Figure 6.) 

According to one captain, cutters spend an extensive amount of time in repair 

status. For example, although 123-foot patrol boats are supposed to be in 

operational status at least 2,500 hours each year, the boats generally spend 

about half the year undergoing repairs and therefore are unable to meet this 

expectation. Also, it is time-consuming for crews to remove parts from assets 

and mail them to the contractor facility for repair. Crewmembers stated that it 

might take several months to get the equipment back from the contractor. 

Without the full complement of C4ISR equipment while repairs are ongoing, 

crews find it difficult to operate the system as a whole. Officials at one 

operations center responsible for coordinating asset deployment often receive 

complaints about contractor delays in providing C4ISR support and repairs, 

but are powerless to help. 

Figure 6: USCG Short Range Prosecutor 

A lack of contractor personnel on site to provide Deepwater C4ISR support 

compounds this situation. Due to limited funding, there is generally only one 

contractor representative available on site at District 7 to respond to problems. 

This representative is not sufficient to service all the assets in the Miami, 

Florida; Key West, Florida; and Savannah, Georgia area. This individual 

functions more as a liaison than a technician with specialized C4ISR training. 

Overworked, this individual may take a week, or one to two months, to 

respond to a LIMS repair request. Crewmembers on one cutter have never 

received a maintenance visit by merely submitting a work order through 

LIMS. At one point, the crewmembers had to reboot their C4ISR systems 

every half hour while at sea to sustain communications. Although Deepwater 

contractors were well aware of the problem, they still had no technicians 

available to resolve it once the cutter returned to port. In commenting on a 

draft of this report, the Coast Guard informed us it has made additional 

support technicians available to respond to crewmember requests. Some 

crewmembers have suggested that cutter support teams, staffed with shoreside relief personnel, also would be helpful so that C4ISR technicians overImprovements Needed in the U.S. Coast Guard’s Acquisition and 

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taxed from keeping the systems operational can take leave once they return 

from sea. 

As a result, instead of working through the established logistics support 

process, Coast Guard personnel sometimes informally contact officials at the 

Maritime Domain Awareness Center or District 7 for assistance even though 

these officials are not responsible for providing Deepwater support. Such ad 

hoc methods of obtaining C4ISR support have led to confusion as to who is 

responsible. The Deepwater program recently outlined plans to assign a 

C4ISR technician to each Deepwater vessel. The strategy is to exchange an 

engineer billet on each ship for an IT specialist billet. The IT specialist billet 

is to serve as a liaison between the cutter and the Deepwater contractor to help 

ensure timely maintenance and support. A drawback to this strategy is the 

fact that the crew will lose an engine maintenance technician—a critically 

needed skill to sustain operations of the aging Coast Guard fleet. 

Additionally, the LIMS system used to coordinate and track maintenance 

requests has been difficult to use. First, as previously discussed, requests for 

assistance submitted through the system are not addressed in a timely manner. 

Users must follow-up repeatedly to determine the status of their maintenance 

or parts requests. Second, users said that although the system has much 

potential, the database is much bigger than what the Coast Guard will ever 

need, making it unwieldy to use to locate needed equipment. For example, 

one crewmember stated that it takes him an average of 90 minutes to locate a 

replacement part in LIMS. Third, LIMS is housed on the communications 

server so that if the server goes down—which it sometimes does due to 

overload—the system becomes inaccessible. When this happens, assets at sea 

become limited in their ability to report maintenance calls. This can affect 

mission readiness if critical equipment fails: at one point the navigation 

system on a cutter shut down, requiring that crewmembers manually chart 

their course in order to dock safely. 

Last, often replacement parts are not entered into the LIMS database in a 

timely manner so that users can readily locate the supplies they need. For 

example, one crewmember needed a laptop battery but neither the laptop nor 

the battery was listed in the system. It took the contractor over a month to 

locate a battery and send it to the crewmember. Crewmembers on this same 

cutter requested a printer and waited two months for a response in LIMS. 

During the delay, their options were to buy a new printer with the ship’s 

funds, borrow one from a nearby cutter, or do without. The crew ultimately 

borrowed a printer from another cutter. Users said that the ability to deal with 

LIMS deficiencies is the result of tremendous effort by the Deepwater on site 

representative and other Coast Guard district maintenance organizations. The 

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COMOPTEVFOR recommended addressing the LIMS deficiencies before 

system access is provided to other Coast Guard locations. 

Because LIMS has not ensured timely IT support, the Coast Guard continues 

to rely on the long-standing practice of issuing casualty reports to 

communicate and coordinate C4ISR maintenance requests. Casualty reports 

are requests issued Coast Guard-wide to call attention to the need for missionessential repairs or maintenance. There are three levels of casualty reports, 

corresponding to the criticality of the needed repair: while category 2 casualty 

reports might be used for minor repairs, category 4 casualty reports are used to 

secure parts or support fundamental to executing maritime missions (such as, 

a cutter cannot sail until a technical problem is fixed). To ensure that C4ISR 

repairs and support are paid for using Deepwater program funds and not 

general agency operating funds, C4ISR users are not supposed to issue 

casualty reports. However, when LIMS fails them, C4ISR users often resort 

to the reports as a means of elevating and ensuring faster response to their 

maintenance requests. 

Recommendations 

We recommend that the Commandant, U.S. Coast Guard, direct the 

Deepwater Program Executive Officer to: 

5. Assess Deepwater staffing needs and apply adequate program 

management resources to effectively oversee and support program 

activities. 

6. Review the Deepwater contract and supporting documents and agreements 

and make modifications as appropriate to ensure that contractor 

responsibilities are clearly defined, communicated, and accepted. 

7. Establish C4ISR spending priorities to help ensure that “system-ofsystems” objectives are achieved in line with budget realities. 

8. Review and revise the Deepwater training approach to ensure that 

sufficient training, adequate instructors, and reference materials are 

available to support C4ISR systems users. 

9. Ensure that the contractor provides adequate and timely support for C4ISR 

systems and their users. 

Management Comments and OIG Evaluation 

We obtained written comments on a draft of this report from the Chief of 

Staff, U.S. Coast Guard. We have included a copy of the comments in their 

entirety at Appendix B. 

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In the comments, the Coast Guard generally concurred with all of the findings 

and recommendations in our report and expressed appreciation for our efforts 

to document areas for improvement regarding Deepwater’s IT systems. The 

Coast Guard said that it is in the process of implementing corrective actions in 

line with the high-level report recommendations, but emphasized that funding 

will be key to accomplishing improvement objectives. Specifically, the Chief 

of Staff said that funding constraints have delayed the Coast Guard’s ability to 

accomplish certain Deepwater IT objectives as scheduled, requiring the 

agency to re-plan programmed work and that this may continue to pose 

challenges for the future. The Chief of Staff went on to provide clarification 

regarding the findings and corresponding recommendations in our report and 

summarize progress the Coast Guard has made to address them. While we 

recognize the efforts that the Coast Guard has ongoing, we look forward to 

receiving periodic updates on implementation progress as well as additional 

improvement initiatives. 

Specifically, the Coast Guard concurred with Recommendation 1 concerning 

the need for increased agency input and oversight of the requirements 

definition process to ensure that contractor activities meet program goals and 

objectives. The Chief of Staff said that our report accurately discusses the 

partnership between the Coast Guard and the prime contractor, ICGS, under 

the terms of the performance-based contract. That is, the contractor is 

responsible for defining and implementing a plan to achieve overall systems 

integration objectives, but the Coast Guard decides whether these 

requirements are being met within available funding. However, the Chief of 

Staff attributed the OIG’s perception of limited Coast Guard influence over 

contractor effectiveness in meeting requirements to its examination of C4ISR 

development activities during an early phase of the program. The Chief of 

Staff inferred that since then, the Coast Guard has put processes in place to 

oversee contractor activities and reduce the need for changes as the contract 

progresses. Further, since 2005, the Coast Guard has taken additional steps to 

improve the requirements definition process and has increased stakeholder 

representation on the integrated product teams involved in technical reviews 

hosted by the contractor. We acknowledge the efforts made to improve the 

requirements definition process during the course of our review and encourage 

continued enhancements to ensure that the contractor fulfills Coast Guard 

expectations. 

Similarly, the Coast Guard concurred with Recommendation 2 concerning 

defining and communicating system requirements change management 

processes. The Chief of Staff stated that the Deepwater Program Office and 

the prime contractor have implemented engineering and broader changemanagement processes approved by the Joint Integrated Deepwater System 

Configuration Control Board. The configuration control board has begun 

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taking steps to help ensure coordination and oversight of program changes and 

avoid changes that may previously have gone unreported. In addition, this 

official said that the requirements management plan is being revised and is 

due for completion in FY 2006. We are encouraged by such advancements in 

the requirements change management process and look forward to reviewing 

the requirements management plan once it is completed. 

The Coast Guard concurred with Recommendation 3 regarding steps needed 

to ensure that the contractor mitigates Deepwater IT security vulnerabilities. 

The Chief of Staff said that the Deepwater Program Office is working closely 

with the Coast Guard’s Command, Control, Communications, Computers, and 

Information Technology Directorate to ensure that proper steps are taken in 

this regard. For example, this official noted that the Coast Guard has 

addressed security vulnerabilities and received authority to operate the C4ISR 

systems used on its 123-foot patrol boats. However, the Coast Guard did not 

address our concerns about continued delays in completing and installing a 

new Coast Guard command and control system at the District 7 Miami shore 

site. We would appreciate clarification on the status of this effort as it will 

affect not only other shore sites that are scheduled to receive the command 

and control system, but also the National Security Cutter which is due to be 

completed in 2007. 

Although the Coast Guard concurred with Recommendation 4 regarding the 

shortcomings of the simulation equipment, the Chief of Staff said that 

independent verification, validation, and accreditation of the simulator is not 

included in the scope of the contract and is not being pursued at this time. 

The Chief of Staff contended that the simulator’s level of accuracy is 

sufficient to verify interfaces within the C4ISR system, even though some 

elements of the Coast Guard have expressed a desire for independent 

verification, validation, and accreditation of the simulator to help ensure that 

the actual systems will function properly when deployed to the assets. 

Further, the Coast Guard did not address part of our recommendation about 

providing the Navy’s Commander, Operational Test and Evaluation Force 

with the access needed for independent test and evaluation of C4ISR systems 

and equipment. In line with our report recommendation, we strongly 

encourage the Coast Guard to plan and complete the verification, validation, 

and accreditation of the simulator to ensure that the testing environment 

matches potential real-life situations. In addition, we request that the Coast 

Guard provide details on its plans for supporting independent C4ISR test and 

evaluation to ensure that the system will operate efficiently and securely after 

implementation. 

The Coast Guard concurred with Recommendation 5 concerning Deepwater 

staffing and program management resource needs. In the response, the Chief 

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of Staff discussed the Commandant’s commitment to evaluating and 

improving the Coast Guard acquisition structure, process, and workforce, but 

cautioned that finding qualified individuals to fill the vacancies has been a 

barrier to providing the program oversight and efficiencies needed. This 

official stated that the Commandant has chartered a panel of experts to 

formulate recommendations on how to improve Coast Guard acquisitions, 

with a particular focus on bolstering in-house subject matter expertise. We 

recognize the difficulties the Coast Guard has had in obtaining qualified 

personnel, and appreciate continued efforts to overcome this challenge. 

Ensuring adequate Deepwater program oversight will be key to ensuring that 

the Coast Guard’s mission objectives are successfully met. 

The Coast Guard concurred with Recommendation 6 and described efforts to 

address and review the Deepwater contract and its supporting documents, 

agreements, and modifications to ensure that contractor responsibilities are 

clearly defined, communicated, and accepted. Specifically, the Chief of Staff 

stated that when contracting officers are asked to interpret the contract, there 

has been no confusion about contractor responsibilities in producing C4ISR 

systems. Further, this official stated that the contracting officers, contracting 

officer technical representatives, and program managers are aligned and ICGS 

is given clear guidance on the contractual requirements. Nonetheless, the 

Chief of Staff stated that for the next contract award term, government and 

contractor responsibilities are being further refined and negotiated. In the 

meantime, activities and processes that can be accomplished within the terms 

of the existing contract will continue. We are encouraged by the Coast 

Guard’s plan to address ambiguities in the contract for the next award term 

and look forward to seeing how the government and contractor responsibilities 

will be clarified and communicated. 

The Coast Guard concurred with Recommendation 7 regarding establishing 

C4ISR spending priorities to achieve “system of systems” objectives. The 

Chief of Staff said that the Coast Guard currently establishes C4ISR spending 

priorities each year, but conceded that enacted funding levels have caused 

certain objectives to be deferred until funding becomes available. Addressing 

priorities within the funding provided may be a challenge, but will be key to 

ensuring that assets are equipped with the C4ISR systems they need to operate 

effectively. 

The Coast Guard concurred with Recommendation 8 concerning C4ISR user 

training and stated that the Coast Guard and contractor have under taken a 

number of actions to address the various training and logistics system issues 

described in our report. Such actions include ensuring pipeline training for 

the National Security Cutter C4ISR suite, as well as providing computer based 

LIMS training. 

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However, the Coast Guard’s response did not address the need to improve 

training for the 123-foot patrol boat and shore site C4ISR operators. 

Specifically, the Chief of Staff responded that most of these issues identified 

in our report have already been brought to Coast Guard management’s 

attention and have already been incorporated into subsequent training plans. 

The Chief of Staff stated also that timely and consistent use of the C4ISR 

systems has improved the contract instructors’ knowledge of the systems and 

that ICGS is meeting funded contractual requirements. We look forward to 

learning more about the improved training plans and approaches to ensure that 

C4ISR operators that will use the system at shore facilities and on other 

Deepwater assets will receive the instruction they need to function effectively. 

Lastly, the Coast Guard concurred with Recommendation 9 regarding 

adequate and timely support for C4ISR systems and their users. Specifically, 

the Chief of Staff stated that while the contractor is meeting current 

requirements, the Coast Guard and contractor are evaluating how to provide 

more effective user support within funding limitations. We look forward to 

learning more about the plans developed for improvements in this area. 

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Appendix A 

Scope and Methodology 

To establish criteria for this review, we researched U.S. laws, regulations, and 

other federal guidance applicable to the Coast Guard. Documentation, such as 

media articles and press releases obtained through Internet searches, provided 

background information about the Deepwater program. Additionally, we 

reviewed earlier reports and congressional testimony by the Government 

Accountability Office and industry organizations to learn more about their 

findings and recommendations related to Deepwater. 

To accomplish our review objectives, we met with representatives at Coast 

Guard headquarters in the Washington, DC area to learn about their roles, 

responsibilities, and activities related to the Deepwater program. Senior Coast 

Guard officials provided initial briefings on the program, and more 

specifically on its C4ISR components. The C4ISR program manager and 

deputy program manager discussed with us the system requirements definition 

process as well as their incremental approach to implementing IT and plans to 

upgrade assets to meet these requirements. These officials, along with other 

staff at the Systems Integration Program office, told us about testing of newly 

developed systems, plans for ensuring interoperability of the systems, and user 

training. They discussed program budgeting, funding, and personnel 

management. Additionally, these officials provided information on 

Deepwater contract requirements, performance measurement, and logistics 

management. 

Personnel at Coast Guard headquarters assisted us in identifying other 

locations where we might visit to learn about new C4ISR components. 

During the course of our review, we visited the Maritime Domain Awareness 

Center, a state-of-the art contractor facility in Moorestown, NJ. This center is 

responsible for developing, testing, and integrating systems and assets related 

to Deepwater as well as other homeland security programs. In addition to 

leading us on a tour of the facility, center officials provided several briefings 

on the Deepwater program structure and plans for providing improved 

command and control. Center officials discussed Deepwater requirements 

definition, change management processes, and integrated product and process 

development. They offered their perspectives on Deepwater program 

management, communications, and training. Also, they outlined plans for 

C4ISR system testing, certification, and accreditation. A contractor at the 

Space and Naval Warfare Systems Command in Charleston, SC discussed 

system testing and evaluation activities, too. 

We visited several Coast Guard vessels and shore sites to understand and 

observe C4ISR upgrades implemented through the Deepwater program. 

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Appendix A 

Scope and Methodology 

Specifically, we toured the following United States Coast Guard Cutters 

(USCGCs) at locations in Portsmouth, VA, and Key West, FL: 

• USCGC NORTHLAND 

• USCGC RESOLUTE 

• USCGC MATAGORDA 

• USCGC NUNIVAK 

• USCGC MANITOU 

• USCGC METOMPKIN 

We visited the Communications Area Master Station Atlantic in Chesapeake, 

VA (responsible for supporting communications among all Coast Guard assets 

on the eastern seaboard of the United States) and the Communications Center 

in Miami, Florida (responsible for supporting Coast Guard District 7 

operations). At the various ship and shore locations, we inspected C4ISR 

upgrades and talked to users about their experiences with the new equipment 

as well as the training and support they had received. At the District 7 

Communications Center, a contractor provided a demonstration of the new 

command and control system under development. Coast Guard officials, 

contractors, and users at District 7 told us about their input into C4ISR 

requirements, system design and security, testing and evaluation of the C4ISR 

domain, and implementation of the C4ISR components. 

Last, we visited two of the Coast Guard’s three centers of excellence in 

communications and IT: The Telecommunications and Information Systems 

Command in Alexandria, Virginia and the Command and Control Engineering 

Center in Portsmouth, Virginia. Although not officially part of the 

Deepwater program, these centers of excellence receive funding to support 

program activities and help ensure that the systems under development will 

interface with existing Coast Guard systems. 

We limited our audit to C4ISR requirements definition and implementation of 

systems upgrades. We did not observe systems testing or address classified 

aspects of the Deepwater program. 

We conducted our audit from December 2005 through April 2006. We 

performed our work according to generally accepted government audit 

standards. The principal OIG points of contact for this audit are Frank Deffer, 

Assistant Inspector General, Information Technology Audits and Sondra 

McCauley, Director, Information Management Division. Other major 

contributors are listed at Appendix C. 

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Appendix B 

Management Response to Draft Report 

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Appendix B 

Management Response to Draft Report 

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Implementation of Deepwater Information Technology Systems

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Appendix B 

Management Response to Draft Report 

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Implementation of Deepwater Information Technology Systems

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Appendix B 

Management Response to Draft Report 

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Implementation of Deepwater Information Technology Systems

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Appendix B 

Management Response to Draft Report 

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Appendix C 

Major Contributors to this Report 

Information Management Division 

Sondra McCauley, Director 

John Shiffer, Audit Manager 

Meghan Sanborn, Auditor 

Shannon Frenyea, Auditor 

 Lane Melton, Technical Support 

 Chiu-Tong Tsang, Referencer 

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Appendix D 

Report Distribution 

Department of Homeland Security

 Secretary 

 Deputy Secretary 

Chief of Staff 

Deputy Chief of Staff 

 Executive Secretariat 

 General Counsel 

Assistant Secretary for Policy 

Assistant Secretary for Public Affairs 

DHS Legislative and Intergovernmental Affairs 

DHS GAO OIG Audit Liaison 

United States Coast Guard 

Chief of Staff 

Deepwater Program Executive Officer 

Deepwater C4ISR Program Manager 

 Audit Liaison 

Office of Management and Budget 

Chief, Homeland Security Branch 

DHS OIG Budget Examiner 

Congress 

Congressional Oversight and Appropriations Committees, as appropriate 

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Appendix D 

Report Distribution 

Improvements Needed in the U.S. Coast Guard’s Acquisition and 

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Additional Information and Copies 

To obtain additional copies of this report, call the Office of Inspector General 

(OIG) at (202) 254-4100, fax your request to (202) 254-4285, or visit the OIG 

web site at www.dhs.gov/oig. 

OIG Hotline 

To report alleged fraud, waste, abuse or mismanagement, or any other kind 

of criminal or noncriminal misconduct relative to department programs or 

operations, call the OIG Hotline at 1-800-323-8603; write to DHS Office of 

Inspector General/MAIL STOP 2600, Attention: Office of Investigations– 

Hotline, 245 Murray Drive, SW, Building 410, Washington, DC 20528; fax 

the complaint to (202) 254-4292; or email DHSOIGHOTLINE@dhs.gov. The 

OIG seeks to protect the identity of each writer and caller.