‘‘(A) assessing the requirements established 
for Coast Guard personnel regarding knowledge 
and skill in acquisition resources management 
and the adequacy of such requirements for facili-
tating the achievement of the performance goals 
established for acquisition management; 
‘‘(B) in order to rectify any deficiency in 
meeting such requirements, developing strategies 
and specific plans for hiring, training, and pro-
fessional development; and 
‘‘(C) reporting to the Commandant on the 
progress made in improving acquisition manage-
ment capability.’’. 
(b) CLERICAL AMENDMENT.—The table of sections at 
the beginning of such chapter is amended by adding at the 
end the following: 
‘‘55. Chief Acquisition Officer.’’. 
(c) SPECIAL RATE SUPPLEMENTS.— 
(1) REQUIREMENT
TO
ESTABLISH.—Not later 
than 1 year after the date of enactment of this Act 
and in accordance with part 9701.333 of title 5, Code 
of Federal Regulations, the Commandant of the Coast 
Guard shall establish special rate supplements that 
provide higher pay levels for employees necessary to 
carry out the amendment made by this section. 
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(2) SUBJECT TO APPROPRIATIONS.—The require-
ment under paragraph (1) is subject to the avail-
ability of appropriations. 
SEC. 4. TESTING AND CERTIFICATION. 
(a) IN GENERAL.—The Secretary shall— 
(1) cause each cutter, other than a National Se-
curity Cutter, acquired by the Coast Guard and deliv-
ered after the date of enactment of this Act to be 
classed by the American Bureau of Shipping, before 
acceptance of delivery; 
(2) cause the design and construction of each Na-
tional Security Cutter, other than National Security 
Cutter 1 and 2, to be certified by an independent 
third party with expertise in vessel design and con-
struction certification to be able to meet a 185-under-
way-day requirement under general Atlantic and 
North Pacific sea conditions for a period of at least 
30 years; 
(3) cause all electronics on all aircraft, surface, 
and shore assets that require TEMPEST certification 
and that are delivered after the date of enactment of 
this Act to be tested and certified in accordance with 
TEMPEST standards and communications security 
(COMSEC) standards by an independent third party 
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that is authorized by the Federal Government to per-
form such testing and certification; and 
(4) cause all aircraft and aircraft engines ac-
quired by the Coast Guard and delivered after the 
date of enactment of this Act to be certified for air-
worthiness by an independent third party with exper-
tise in aircraft and aircraft engine certification, be-
fore acceptance of delivery. 
(b) FIRST IN CLASS OF A MAJOR ASSET ACQUISI-
TION.—The Secretary shall cause the first in class of a 
major asset acquisition of a cutter or an aircraft to be sub-
jected to an assessment of operational capability conducted 
by the Secretary of the Navy. 
(c) FINAL ARBITER.—The Secretary shall be the final 
arbiter of all technical disputes regarding designs and ac-
quisitions of vessels and aircraft for the Coast Guard. 
SEC. 5. NATIONAL SECURITY CUTTERS. 
(a) NATIONAL SECURITY CUTTERS 1 AND 2.— 
(1) REPORT
ON
OPTIONS
UNDER
CONSIDER-
ATION.—The Secretary shall submit to the Committee 
on Transportation and Infrastructure of the House of 
Representatives and the Committee on Commerce, 
Science, and Transportation of the Senate— 
(A) within 120 days after the date of enact-
ment of this Act, a report describing in detail the 
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cost increases that have been experienced on Na-
tional Security Cutters 1 and 2 since the date of 
the issuance of the task orders for construction of 
those cutters and explaining the causes of these 
cost increases; and 
(B) within 180 days after the date of enact-
ment of this Act, a report on the options that the 
Coast Guard is considering to strengthen the 
hulls of National Security Cutter 1 and National 
Security Cutter 2, including— 
(i) the costs of each of the options 
under consideration; 
(ii) a schedule for when the hull 
strengthening repairs are anticipated to be 
performed; and 
(iii) the impact that the weight likely 
to be added to each the cutter by each op-
tion will have on the cutter’s ability to meet 
both the original performance requirements 
included in the Deepwater Program con-
tract and the performance requirements cre-
ated by contract Amendment Modification 
00042 dated February 7, 2007. 
(2) DESIGN
ASSESSMENT.—Not later than 30 
days before the Coast Guard signs any contract, deliv-
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ery order, or task order to strengthen the hull of either 
of National Security Cutter 1 or 2 to resolve the 
structural design and performance issues identified in 
the Department of Homeland Security Inspector Gen-
eral’s report OIG–07–23 dated January 2007, the 
Secretary shall submit to the Committee on Transpor-
tation and Infrastructure of the House of Representa-
tives and the Committee on Commerce, Science, and 
Transportation of the Senate all results of an assess-
ment of the proposed hull strengthening design con-
ducted by the Naval Surface Warfare Center, 
Carderock Division, including a description in detail 
of the extent to which the hull strengthening measures 
to be implemented on those cutters will enable the cut-
ters to meet a 185-underway-day requirement under 
general Atlantic and North Pacific sea conditions for 
a period of at least 30 years. 
(b) NATIONAL SECURITY CUTTERS 3 THROUGH 8.— 
Not later than 30 days before the Coast Guard signs any 
contract, delivery order, or task order authorizing construc-
tion of National Security Cutters 3 through 8, the Secretary 
shall submit to the Committee on Transportation and In-
frastructure of the House of Representatives and the Com-
mittee on Commerce, Science, and Transportation of the 
Senate all results of an assessment of the proposed designs 
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to resolve the structural design, safety, and performance 
issues identified by the Department of Homeland Security 
Office of Inspector General report OIG–07–23 for the hulls 
of those cutters conducted by the Naval Surface Warfare 
Center, Carderock Division, including a description in de-
tail of the extent to which such designs will enable the cut-
ters to meet a 185-underway-day requirement under general 
Atlantic and North Pacific sea conditions. 
SEC. 6. MISCELLANEOUS REPORTS. 
(a) IN GENERAL.—The Secretary shall submit the fol-
lowing reports to the Committee on Transportation and In-
frastructure of the House of Representatives and the Com-
mittee on Commerce, Science, and Transportation of the 
Senate: 
(1) Within 4 months after the date of enactment 
of this Act, a justification for why 8 National Secu-
rity Cutters are required to meet the operational 
needs of the Coast Guard, including— 
(A) how many days per year each National 
Security Cutter will be underway at sea; 
(B) where each National Security Cutter 
will be home ported; 
(C) the amount of funding that will be re-
quired to establish home port operations for each 
National Security Cutter; 
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(D) the extent to which 8 National Security 
Cutters deployed without vertical unmanned aer-
ial vehicles (VUAV) will meet or exceed the mis-
sion capability (including surveillance capacity) 
of the 12 Hamilton-class high endurance cutters 
that the National Security Cutters will replace; 
(E) the business case in support of con-
structing National Security Cutters 3 through 8, 
including a cost-benefit analysis; and 
(F) an analysis of how many Offshore Pa-
trol Cutters would be required to provide the pa-
trol coverage provided by a National Security 
Cutter. 
(2) Within 4 months after the date of enactment 
of this Act, a report on— 
(A) the impact that deployment of a Na-
tional Security Cutter and other cutter assets 
without the vertical unmanned aerial vehicle 
(VUAV) will have on the amount of patrol cov-
erage that will be able to be provided during 
missions conducted by the National Security 
Cutter and all other cutters planned to be 
equipped with a VUAV; 
(B) how the coverage gap will be made up; 
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(C) an update on the current status of the 
development of the VUAV; and 
(D) the timeline detailing the major mile-
stones to be achieved during development of the 
VUAV and identifying the delivery date for the 
first and last VUAV. 
(3) Within 30 days after the elevation to flag- 
level for resolution of any design or other dispute re-
garding the Deepwater Program contract or an item 
to be procured under that contract, including a de-
tailed description of the issue and the rationale un-
derlying the decision taken by the flag officer to re-
solve the issue. 
(4) Within 4 months after the date of enactment 
of this Act, a report detailing the total number of 
change orders that have been created by the Coast 
Guard under the Deepwater Program before the date 
of enactment of this Act, the total cost of these change 
orders, and their impact on the Deepwater Program 
schedule. 
(5) Within 180 days after the date of enactment 
of this Act, a report detailing the technology risks and 
level of maturity for major technologies used on mari-
time patrol aircraft, the HC–130J, and the National 
Security Cutter. 
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(6) Not less than 60 days before signing a con-
tract to acquire any vessel or aircraft, a report com-
paring the cost of purchasing that vessel or aircraft 
directly from the manufacturer or shipyard with the 
cost of procuring it through the Integrated Coast 
Guard System. 
(7) Within 30 days after the Program Executive 
Officer of the Deepwater Program becomes aware of a 
likely cost overrun exceeding 5 percent of the overall 
asset acquisition contract cost or schedule delay ex-
ceeding 5 percent of the estimated asset construction 
period under the Deepwater Program, a report by the 
Commandant containing a description of the cost 
overrun or delay, an explanation of the overrun or 
delay, a description of Coast Guard’s response, and a 
description of significant delays in the procurement 
schedule likely to be caused by the overrun or delay. 
(8) Within 90 days after the date of enactment 
of this Act, articulation of a doctrine and description 
of an anticipated implementation of a plan for man-
agement of acquisitions programs, financial manage-
ment (including earned value management and cost 
estimating), engineering and logistics management, 
and contract management, that includes— 
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(A) a description of how the Coast Guard 
will cultivate among uniformed personnel exper-
tise in acquisitions management and financial 
management; 
(B) a description of the processes that will 
be followed to draft and ensure technical review 
of procurement packages, including statements of 
work, for any class of assets acquired by the 
Coast Guard; 
(C) a description of how the Coast Guard 
will conduct an independent cost estimating 
process, including independently developing cost 
estimates for major change orders; and 
(D) a description of how Coast Guard will 
strengthen the management of change orders. 
(9) Within 4 months after the date of enactment 
of this Act, a report on the development of a new ac-
quisitions office within the Coast Guard describing 
the specific staffing structure for that directorate, in-
cluding— 
(A) identification of all managerial posi-
tions proposed as part of the office, the functions 
that each managerial position will fill, and the 
number of employees each manager will super-
vise; and 
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(B) a formal organizational chart and iden-
tification of when managerial positions are to be 
filled. 
(10) Ninety days prior to the issuance of a Re-
quest for Proposals for construction of an Offshore 
Patrol Cutter, a report detailing the service life, fa-
tigue life, maximum range, maximum speed, and 
number of days underway under general Atlantic and 
North Pacific Sea conditions the cutter shall be built 
to achieve. 
(11) The Secretary shall report annually on the 
percentage of the total amount of funds expended on 
procurements under the Deepwater Program that has 
been paid to each of small businesses and minority- 
owned businesses. 
(12) Within 120 days after the date of enactment 
of this Act, a report on any Coast Guard mission per-
formance gap due to the removal of Deepwater Pro-
gram assets from service. The report shall include the 
following: 
(A) A description of the mission perform-
ance gap detailing the geographic regions and 
Coast Guard capabilities affected. 
(B) An analysis of factors affecting the mis-
sion performance gap that are unrelated to the 
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Deepwater Program, including deployment of 
Coast Guard assets overseas and continuous ves-
sel shortages. 
(C) A description of measures being taken 
in the near term to fill the mission performance 
gap, including what those measures are and 
when they will be implemented. 
(D) A description of measures being taken 
in the long term to fill the mission performance 
gap, including what those measures are and 
when they will be implemented. 
(E) A description of the potential alter-
natives to fill the mission performance gap, in-
cluding any acquisition or lease considered and 
the reasons they were not pursued. 
(b) REPORT REQUIRED ON ACCEPTANCE OF DELIVERY 
OF INCOMPLETE ASSET.— 
(1) IN GENERAL.—If the Secretary accepts deliv-
ery of an asset after the date of enactment of this Act 
for which a contractually required certification can-
not be achieved within 30 days after the date of deliv-
ery or with any system that is not fully functional 
for the mission for which it was intended, the Sec-
retary shall submit to the Committee on Transpor-
tation and Infrastructure of the House of Representa-
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tives and the Committee on Commerce, Science, and 
Transportation of the United States Senate within 30 
days after accepting delivery of the asset a report ex-
plaining why acceptance of the asset in such a condi-
tion is in the best interests of the United States Gov-
ernment. 
(2) CONTENTS.—The report shall— 
(A) specify the systems that are not able to 
achieve 
contractually 
required 
certifications 
within 30 days after the date of delivery and the 
systems that are not fully functional at the time 
of delivery for the missions for which they were 
intended; 
(B) identify milestones for the completion of 
required certifications and to make all systems 
fully functional; and 
(C) identify when the milestones will be 
completed, who will complete them, and the cost 
to complete them. 
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SEC. 7. USE OF THE NAVAL SEA SYSTEMS COMMAND, THE 
NAVAL AIR SYSTEMS COMMAND, AND THE 
SPACE AND NAVAL WARFARE SYSTEMS COM-
MAND TO ASSIST THE COAST GUARD IN EXER-
CISING TECHNICAL AUTHORITY FOR THE 
DEEPWATER PROGRAM AND OTHER COAST 
GUARD ACQUISITION PROGRAMS. 
(a) FINDINGS.—Congress finds that the Coast Guard’s 
use of the technical, contractual, and program management 
oversight expertise of the Department of the Navy in ship 
and aircraft production complements and augments the 
Coast Guard’s organic expertise as it procures assets for the 
Deepwater Program. 
(b) INTER-SERVICE TECHNICAL ASSISTANCE.—The 
Secretary may enter into a memorandum of understanding 
or a memorandum of agreement with the Secretary of the 
Navy to provide for the use of the Navy Systems Commands 
to assist the Coast Guard with the oversight of Coast Guard 
major acquisition programs. Such memorandum of under-
standing or memorandum of agreement shall, at a min-
imum provide for— 
(1) the exchange of technical assistance and sup-
port that the Coast Guard Chief Engineer and the 
Coast Guard Chief Information Officer, as Coast 
Guard Technical Authorities, may identify; 
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(2) the use, as appropriate, of Navy technical ex-
pertise; and 
(3) the temporary assignment or exchange of per-
sonnel between the Coast Guard and the Navy Sys-
tems Commands to facilitate the development of or-
ganic capabilities in the Coast Guard. 
(c) TECHNICAL
AUTHORITIES.—The Coast Guard 
Chief Engineer, Chief Information Officer, and Chief Acqui-
sition Officer shall adopt, to the extent practicable, proce-
dures that are similar to those used by the Navy Senior 
Acquisition Official to ensure the Coast Guard Technical 
Authorities, or designated Technical Warrant Holders, ap-
prove all technical requirements. 
(d) COORDINATION.—The Secretary, acting through 
the Commandant of the Coast Guard, may coordinate with 
the Secretary of the Navy, acting through the Chief of Naval 
Operations, to develop processes by which the assistance will 
be requested from the Navy Systems Commands and pro-
vided to the Coast Guard. 
(e) REPORT.—Not later than 120 days after the date 
of enactment of this Act and every twelve months thereafter, 
the Commandant of the Coast Guard shall report to the 
Committee on Transportation and Infrastructure of the 
House of Representatives and the Committee on Commerce, 
Science, and Transportation of the Senate on the activities 
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undertaken pursuant to such memorandum of under-
standing or memorandum of agreement. 
SEC. 8. DEFINITIONS. 
In this Act: 
(1) DEEPWATER
PROGRAM.—The term ‘‘Deep-
water Program’’ means the Integrated Deepwater 
Systems Program described by the Coast Guard in its 
report to Congress entitled ‘‘Revised Deepwater Imple-
mentation Plan 2005’’, dated March 25, 2005. The 
Deepwater Program primarily involves the procure-
ment of cutter and aviation assets that operate more 
than 50 miles offshore. 
(2) SECRETARY.—The term ‘‘Secretary’’ means 
the Secretary of the department in which the Coast 
Guard is operating. 
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Union Calendar No. 172 
110TH CONGRESS 
1ST SESSION 
H. R. 2722 
[Report No. 110–270] 
A BILL 
To restructure the Coast Guard Integrated 
Deepwater Program, and for other purposes. 
JULY 30, 2007 
Reported with an amendment, committed to the Com-
mittee of the Whole House on the State of the Union, 
and ordered to be printed 
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