Littoral Combat Ship: Navy Complied with Regulations in Accepting Two Lead Ships, but Quality Problems Persisted after Delivery
Published: 2014-09-25T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: GAO has reported extensively on LCS—an innovative Navy program, consisting of a ship and its mission packages. The Navy bought the first two ships using research and development funds, initially planning to experiment with them to test concepts and determine the best design. As GAO reported in July 2013, the Navy later opted to fund additional ships without having completed this planned period of discovery and learning. Further, LCS 1 and LCS 2 have experienced major cost growth and schedule delays. In August 2010, GAO reported that the ships were incomplete at delivery and in November 2013, GAO reported on significant quality problems with Navy ships, including LCS 1 and LCS 2, noting that the Navy regularly accepts ships with numerous open deficiencies.
Congress mandated that GAO review the Navy's compliance with federal regulations in accepting LCS 1 and LCS 2. This report (1) assesses the extent to which the Navy complied with applicable federal regulations, policies, and contracts and (2) evaluates the basis for and outcomes from decisions to accept these ships. To conduct this work, GAO analyzed applicable federal regulations, policies, contracts, and program documentation, and spoke with relevant Department of Defense (DOD) and contractor officials.
section_title: What GAO Found
paragraphs: Navy decisions to accept the first two littoral combat ships (LCS)—LCS 1 and LCS 2—in incomplete, deficient conditions complied with the Federal Acquisition Regulation's (FAR) acceptance provisions, largely due to the cost-reimbursement type contracts in place to construct these ships. The Navy also met FAR requirements related to responsibility for and place of acceptance, among other provisions, by using an authorized Navy representative to accept each ship at its respective contractor's facility. Under the cost-reimbursement contracts, the LCS 1 and LCS 2 prime contractors were only required to give their best efforts to complete quality-related activities—along with the other work specified in the contracts—up to each contract's estimated cost. These efforts resulted in both ships not completing all required sea trials—tests that evaluate ships' overall quality and performance against contractual requirements—including acceptance and final contract trials, as shown in the table below.
Not completing these trials increased knowledge gaps related to ship performance and deficiencies. In addition, LCS 1 and LCS 2 did not meet the quality standards outlined in the Navy's ship acceptance policy, although the policy also contains several notable flexibilities to these standards. In particular, the policy recognizes situations where the Navy may defer work until after delivery and final acceptances and affords the Chief of Naval Operations the authority to waive certain quality standards outlined in the policy. The Navy relied extensively on these waivers to facilitate its trials and acceptance processes for LCS 1 and LCS 2.
Navy decisions to accept delivery of LCS 1 and LCS 2 in incomplete, deficient conditions were driven by a focus on near-term cost performance by shipbuilders, a desire to introduce the long-delayed ships to the fleet, and—in the case of LCS 1—environmental and treaty considerations associated with constructing that ship adjacent to the Great Lakes. The Navy prioritized these factors over its quality assurance processes for both ships, which has caused it to devote considerably more time and money to resolving deficiencies after delivery than anticipated. However, because the Navy did not establish clear deadlines for resolving ship deficiencies, corrections were allowed to lag, to the point that fleet operators inherited unresolved deficiencies on each ship. These deficiencies have constrained recent shipboard operations.
section_title: What GAO Recommends
paragraphs: Because the opportunity to implement acquisition changes to these two ships has passed, GAO is not making any new recommendations in this report, but has made prior recommendations to improve LCS acquisition. DOD has acted on some, but not all, of these.

section_title: Letter
paragraphs: The Navy’s Littoral Combat Ship (LCS) is a program framed by an  innovative approach to shipbuilding acquisition and naval operations.  Unlike other Navy surface combatants, which generally have fixed  mission systems, LCS is intended to be reconfigurable to perform three  different primary missions: mine countermeasures, surface warfare, and  anti-submarine warfare. The LCS consists of two distinct parts: (1) a  seaframe, which is essentially the ship itself, and (2) a mission package,  which is an interchangeable set of sensors, weapons, aircraft, surface  craft, and subsurface vehicles carried on and deployed from the  seaframe.
The LCS will represent a large portion of the Navy’s future surface  combatant fleet. Currently, the Navy plans to spend over $25 billion (in  2010 dollars) to acquire 32 LCS seaframes—in two variants from two  contractors—and 64 mission packages. The Navy had planned to acquire  52 seaframes but in February 2014, the Secretary of Defense directed the  Navy to not contract for more than 32 ships, citing concerns about the  ships’ capabilities—including survivability and lethality. The Secretary  directed the Navy to revisit the designs of both seaframe variants; that  review is ongoing. To date, the Navy has accepted delivery of 4  seaframes—including the two lead ships, LCS 1 and LCS 2—and has  contracted for 20 additional seaframes.
Federal and Department of Defense (DOD) regulations, policies, and  contracts set forth certain criteria for the Navy’s acceptance of goods and  services—including ships—from contractors. In 2010, we found that the  Navy had accepted delivery of LCS 1 and LCS 2 with both seaframes in   In 2013, we  an incomplete state and with outstanding technical issues.found that several of these deficiencies continued to persist, and that  certain trials normally carried out for new ships remained incomplete for  the two lead ships. We also found that these ships had followed an  unusual acceptance process, which the Navy program office attributed to  the research, development, test, and evaluation funding used to construct  them. In light of its own concerns about these ships, Congress mandated  in the National Defense Authorization Act for Fiscal Year 2013 that GAO  conduct a review of the Navy’s compliance with subpart 46.5 of the  Federal Acquisition Regulation (FAR), which concerns government  acceptance of contractor-provided supplies and services, and the  corresponding subpart in DOD’s FAR Supplement (DFARS) in accepting  LCS 1 and LCS 2. This report (1) assesses the extent to which the Navy  complied with applicable federal regulations, contracts, and policies in  accepting LCS 1 and LCS 2 and (2) evaluates the basis for and outcomes  from the Navy’s decision to accept delivery of these ships.
To assess the extent to which the Navy complied with applicable federal  regulations, contracts, and policies, we identified ship acceptance  requirements outlined in the FAR, DFARS, Navy policies, and the  contracts for LCS 1 and LCS 2. We also analyzed DOD and Navy  documentation, including acquisition strategies, trial schedules and  reports, material inspection and receiving reports, deficiency waivers, and  answers to questions posed to the Navy’s Assistant General Counsel for  Research, Development and Acquisition to identify how the Navy applied  or waived these requirements in accepting LCS 1 and LCS 2 in deficient  conditions. To evaluate the basis for and outcomes from the Navy’s  acceptance decisions, we analyzed Navy and contractor documents  detailing LCS 1 and LCS 2 construction costs and schedules, testing  plans, and deficiency correction plans. In addition, we analyzed Navy  budget submissions and post-delivery work agreements to evaluate how  and whether the Navy achieved the post-delivery cost efficiencies it  anticipated when accepting LCS 1 and LCS 2. We obtained Navy data to  determine the number and type of deficiencies for each vessel. We  reviewed information about the data and the system that produced them,  and determined that the data were sufficiently reliable for the purposes of  this report for the ships we reviewed. We also reviewed fleet reports on  equipment casualties to understand the extent to which persisting LCS 1  and LCS 2 deficiencies have affected recent operations. We  supplemented each of the above steps by interviewing officials  responsible for managing LCS contracts, construction, trials, and  acceptances. A more detailed description of our scope and methodology  is presented in appendix I.
We conducted this performance audit from November 2013 to September  2014 in accordance with generally accepted government auditing  standards. Those standards require that we plan and perform the audit to  obtain sufficient, appropriate evidence to provide a reasonable basis for  our findings and conclusions based on our audit objectives. We believe  that the evidence obtained provides a reasonable basis for our findings  and conclusions based on our audit objectives.
subsections: section_title: Background
paragraphs: LCS is designed to move fast and transport manned and unmanned mine  countermeasures, surface warfare, and anti-submarine warfare systems  into theater. For the LCS, the seaframe consists of the hull; command  and control systems; automated launch, handling, and recovery systems;  and certain core combat systems like an air defense radar and 57- millimeter gun. The Navy is embedding LCS’s mine countermeasures,  surface warfare, and anti-submarine warfare capabilities within mission  packages. These packages—acquired separately from the seaframes— are comprised of unmanned underwater vehicles, unmanned surface  vehicles, towed systems, and hull- and helicopter-mounted weapons.
subsections: section_title: Seaframe Acquisition
paragraphs: The Navy acquired the first two seaframes, LCS 1 and LCS 2, in two  different designs from shipbuilding teams led by Lockheed Martin and  General Dynamics. Lockheed Martin constructed LCS 1 at Marinette  Marine, which is located in Marinette, Wisconsin, while General Dynamics  constructed LCS 2 at Austal USA in Mobile, Alabama. In addition to LCS  1 and LCS 2, the Navy has also contracted for construction of an  additional 22 ships, of which 2 (LCS 3 and LCS 4) have been delivered to  date.set of performance requirements. The most notable difference is that the   The two designs reflect different contractor solutions to the same  Lockheed Martin version—referred to as the Freedom variant—is a  monohull design with a steel hull and aluminum superstructure, while the  General Dynamics/Austal USA version—known as the Independence  variant—is an aluminum trimaran.
LCS was intended to be an affordable ship at $220 million per seaframe.  The Navy executed cost-reimbursement contracts with the shipbuilding  teams for design of LCS 1 and LCS 2 in July 2003. Subsequently, the  Navy exercised options under these contracts for the detail design and  construction of LCS 1 and LCS 2—in December 2004 and October  2005—for $188.2 million and $223.2 million, respectively. Cost- reimbursement contracts provide for payment of allowable incurred costs,  to the extent prescribed in the contract, and establish an estimate of the  total cost of the contract—referred to as the total estimated cost or ceiling  cost. This contract type places most of the risk on the government, which  may pay more than budgeted should incurred costs be more than  expected when the contract is signed, and can be appropriate for use on  complex research and development projects when performance  uncertainties or the likelihood of changes makes it difficult to estimate  performance costs in advance. Under this contracting arrangement, the  contractor agrees to use its best efforts to perform the work specified  under the contract within the estimated cost. However, the government  must reimburse the contractor for its allowable costs regardless of  whether the contractor completes work on the particular item. The Navy  contracted for the remaining seaframes currently under contract using  fixed-price incentive contracts. Fixed-price incentive contracts place  increased risk on the contractor, which generally bears some  responsibility for increased costs of performance, including full  responsibility once the contract’s price ceiling is exceeded.
The Navy’s acquisition strategy for LCS seaframes has changed several  times over the past decade. The original plan was to fund one or two  initial ships—in what the Navy called a Flight 0 configuration—based on  the designs it selected through a conceptual design competition, and then  spend time experimenting with the seaframes and overall LCS concept.
Further, the significant differences between the two seaframe designs lent  even more importance to the experimentation concept to inform a  decision about which seaframe design was better suited to meet the  Navy’s needs. After a down-select decision, the winning design was to be  procured in larger numbers, with any design changes incorporated into a  new Flight 1 configuration. The Navy abandoned this strategy, however,  after concluding it would be unrealistic to expect the two competing  shipyards to build only one or two ships and then wait for the Navy to  complete the period of experimentation before awarding additional  contracts. Instead, the Navy opted to continue funding additional  seaframes.
section_title: Ship Acceptance Requirements and Processes
paragraphs: Several federal and DOD regulations and Navy policies govern Navy ship  acceptance processes. For LCS 1 and LCS 2, these regulations and  policies include the following:
FAR part 46: Prescribes policies and procedures to ensure that  supplies (such as ships) and services acquired under a government  contract conform to the contract’s quality and quantity requirements,  including provisions on inspection and acceptance. Under the terms of  inspection clauses in government contracts, the government generally  has the right to inspect and test supplies tendered under the contract  before accepting the supplies.
FAR section 46.101 defines acceptance as the act of an  authorized representative of the government by which the  government assumes ownership of supplies tendered as partial or  complete performance of the contract.
FAR subpart 46.5 prescribes specific regulations on acceptance.
Section 46.501 states, among other things, that acceptance  constitutes acknowledgement that the supplies or services  conform with applicable contract quality and quantity requirements  except as provided in the subpart and subject to other terms and  conditions of the contract. Other subpart 46.5 sections identify  regulations related to responsibility for and place of acceptance,  certificates of conformance, and transfer of title and risk of loss.
DFARS subpart 246.5: Identifies DOD regulations related to  certificates of conformance, including use of a certificate of  conformance for ship critical safety items.
Office of the Chief of Naval Operations Instruction (OPNAVINST)  4700.8H, Trials, Acceptance, Commissioning, Fitting Out,  Shakedown, and Post Shakedown Availability of U.S. Naval Ships  Undergoing Construction or Conversion (Dec. 5, 1990). This  instruction outlines Navy policy, procedures, and responsibilities  related to ship acceptances.
As is typical for all Navy ships, including LCS seaframes, after the  shipbuilder is satisfied that the ship is complete, the ship embarks on a  series of dockside and at-sea tests—known as sea trials—to evaluate  overall quality and performance against the contractually required  technical specifications and performance requirements. Navy shipbuilding  programs, including LCS, generally conduct two sets of sea trials— builder’s trials and acceptance trials.
During builder’s trials, inspectors from the Navy’s Supervisor of  Shipbuilding, Conversion, and Repair (SUPSHIP) are generally  responsible for observing and identifying deficiencies. SUPSHIP is the  organization charged with administering and managing DOD contracts  with commercial entities in the shipbuilding and ship repair industry.
During acceptance trials, the responsibility for identifying deficiencies  falls upon the Navy’s Board of Inspection and Survey (INSURV), an  independent organization whose inspectors evaluate the newly  constructed ship and report on its material condition to Congress and  Navy leadership.
Ideally, following the successful completion of sea trials and once the  government is satisfied that the ship meets requirements, the shipbuilder  delivers the ship. Delivery is also referred to as preliminary acceptance  of the ship. The Navy accepted delivery of LCS 1 and LCS 2 on  September 18, 2008, and December 18, 2009, respectively. In Navy  shipbuilding, the official transfer of custody occurs at preliminary  acceptance when the Navy signs a Material Inspection and Receiving  Report (Form DD 250).
Following preliminary acceptance, Navy ships undergo several additional  activities to prepare them for service within the fleet. These activities,  which can generally take up to a year to complete, include the following:
Guaranty period: The guaranty period is a time specified in the  contract during which the shipbuilder retains responsibility for  correcting any defects that arise on the ship (other than normal wear  and tear). The guaranty period is initiated once the Navy accepts  delivery of the ship (i.e., once the Form DD 250 is signed). The LCS 1  and LCS 2 contracts each provided for 8-month guaranty periods.
Industrial post-delivery availability and/or post-delivery  availability: The Navy completes one or both of these availabilities  following ship delivery to accomplish remaining work, including critical  engineering changes identified late in the construction schedule that  were not completed during ship construction. These changes are to  address safety or mission critical issues or are essential to support  post-delivery test and trials.
Final outfitting and post-delivery tests: Following delivery and until  sailaway from the shipbuilder’s yard—usually anywhere from 10 to 90  days after the Navy accepts delivery—the crew boards the ship and  begins training. Additional training and operational tests of mission  systems occur at the ship’s home port.
Final contract trials: INSURV inspectors conduct a second round of  sea trials to assess whether the ship and all mission equipment are  operating as intended. Typically, these trials are held prior to  expiration of the ship’s guaranty period.
Final acceptance: Upon expiration of any contractually specified  guaranty period, final acceptance occurs. The Navy does not  complete any documentation related to final acceptance of ships. For  LCS 1 and LCS 2, final acceptances occurred in May 2009 and  August 2010, respectively.
Post shakedown availability: A period of planned maintenance  follows final contract trials. During this time, class-wide upgrades and  correction of new or previously identified deficiencies that are the  government’s responsibility also occur.
Obligation and work limiting date: The official date on which full  responsibility for funding the ship’s operation and maintenance is  transferred from the acquisition command to the operational fleet. The  Navy is required to set an obligation and work limiting date for any  ship it constructs using Shipbuilding and Conversion, Navy (SCN)  appropriations. LCS 1 and LCS 2, however, are unique among Navy  ships in that they were constructed using Research, Development,  Test and Evaluation (RDT&E) appropriations, and pursuant to Navy  guidance, there is no requirement for an obligation and work limiting  date for ships constructed with RDT&E funds.
Figure 1 highlights how these different events are typically sequenced for  Navy ships.
Quality deficiencies on Navy ships can be identified at all points  throughout the shipbuilding process, during construction to sea trials and  even after delivery. SUPSHIP oversees the construction process by  inspecting and testing the shipbuilder’s completed work and issuing  requests for the shipbuilder to correct any identified deficiencies. During  acceptance trials, INSURV inspectors label the most serious issues as  “starred” deficiencies. These issues can significantly degrade a ship’s  ability to perform an assigned primary or secondary operational capability  or the crew’s ability to safely operate and maintain ship systems. Because  of their importance, starred deficiencies must be corrected by the builder  or waived by the Chief of Naval Operations prior to accepting delivery of  the ship.
We have previously reported extensively on risks and challenges  confronting the Navy’s acquisition of LCS seaframes. In particular, our  reports have highlighted multiple issues surrounding the deliveries of LCS  1 and LCS 2:  In August 2010, we found that the Navy accepted delivery of LCS 1  and LCS 2 in incomplete, deficient states. Most notably, shipbuilders  had not demonstrated the launch, handling, and recovery systems— critical for deploying and retrieving mission package watercraft—on  LCS 1 or LCS 2 ahead of those ships’ deliveries and subsequent final  acceptances.
In November 2013, we reported on quality shortfalls across Navy  shipbuilding programs, including LCS. We found that LCS 1 and LCS  2 were delivered with a large number of open deficiencies, the  majority of which were determined to be attributable to the  contractors. Our analysis found that over half of these deficiencies  were closed after the ships were delivered to the Navy and were  being outfitted, but other deficiencies continued to be unresolved one  year after delivery—a point at which the Navy had taken final  acceptance of LCS 1 and LCS 2. We subsequently made several  recommendations aimed at improving the construction quality of ships  delivered to the Navy.
In July 2014, we reported on testing and weight management  challenges facing LCS seaframes. We found that initial seaframes  face capability limitations resulting from weight growth during  construction, including LCS 1 and LCS 2 not meeting performance  requirements for sprint speed and endurance, respectively.
The Navy addressed some, but not all, of our recommendations in these  different reports.
section_title: Navy Complied with FAR Acceptance Provisions and Took Full Advantage of Waivers to Accept Ships with Quality Deficiencies
paragraphs: The Navy complied with the relevant FAR provision in accepting LCS 1  and LCS 2 in incomplete, deficient conditions, largely due to the cost- reimbursement type contracts in place to construct these ships. The  Navy also met FAR requirements related to responsibility for and place of  acceptance and transfer of title, among other provisions. Under the cost- reimbursement contracts, the LCS 1 and LCS 2 prime contractors were  only required to give their best efforts to complete quality-related  activities—along with the other work specified in the contracts—up to  each contract’s estimated cost. These efforts resulted in LCS 1 and LCS  2 not completing final contract trials, and LCS 2 not finishing its  acceptance trials—resulting in increased knowledge gaps related to ship  performance and deficiencies. In addition, the Navy did not achieve the  quality standards on LCS 1 and LCS 2 that are outlined in its own ship  acceptance policy, although the policy also contains several notable  flexibilities to these standards. In particular, the policy recognizes  situations where the Navy may defer work until after delivery and final  acceptances and affords the Chief of Naval Operations the power to  waive certain quality standards outlined in the policy. The Navy relied  extensively on these waivers to facilitate its trials and acceptance  processes for LCS 1 and LCS 2.
subsections: section_title: Navy Acceptances of LCS 1 and LCS 2 Complied with FAR Acceptance Provisions, Largely Because of Contract Type
paragraphs: Although LCS 1 and LCS 2 contained numerous deficiencies—including  areas of the ships that remained incomplete when the Navy took final  acceptance—the Navy’s actions complied with section 46.501 of the FAR  because these actions were consistent with the cost-reimbursement   Under cost-reimbursement type  terms of the respective contracts.contracts, the government generally reimburses the contractor for the  costs it incurs in performing the contract. Specifically, cost-reimbursement  contracts such as the LCS 1 and LCS 2 contracts include a “limitation of  cost” or “limitation of funds” clause, which provides an estimated cost  (also known as the ceiling cost) for performance of the contract. These  clauses state that the government is not obligated to reimburse the  contractor for costs incurred in excess of the estimated cost, and the  contractor is not obligated to continue performance or otherwise incur  costs in excess of the estimated cost. For ships, including LCS 1 and  LCS 2, the limitation of cost or funds clause applies through the end of  the guaranty period, which culminates in final acceptance.
According to the Navy’s assistant general counsel for research,  development and acquisition, at the point when the Navy was to take final  acceptance of LCS 1 and LCS 2, each ship’s contractor had incurred  costs that were close to the respective total estimated cost (ceiling cost)  of the contract. Pursuant to the limitation of cost clause in each of the  contracts, the LCS contractors were not obligated to repair or replace  non-conforming work or otherwise incur costs in excess of the total  estimated contact cost, regardless of whether the ships failed to meet  quality standards or were otherwise incomplete at the point when the  Navy accepted the ships. Once the contractors had incurred costs equal  to the respective total estimated costs, the Navy faced the choice of either  increasing total estimated costs to permit the respective contractors to  continue work or proceeding with final acceptances of the ships in their  deficient conditions. For LCS 1 and LCS 2, the Navy took the second  approach.
The Navy also complied with the other requirements of FAR subpart 46.5  and DFARS subpart 246.5 regarding the government’s acceptance of  supplies or services. In particular, each ship was accepted by an  authorized SUPSHIP representative at the respective contractor’s facility  as specified in the contracts, and the Navy did not need to employ any  certificates of conformance for either LCS 1 or LCS 2. In addition, FAR  subpart 46.5 contains a provision on transfer of title and risk of loss. The  Navy’s ship acceptance process—including the transfer of custody by  signing the Material Inspection and Receiving Report—and the passage  of title to a ship are separate processes, and no specific document  transfers title of a ship to the Navy. There was no specific point in time  when titles to LCS 1 and LCS 2 as a whole were transferred to the Navy.  Passage of titles to these ships complied with the applicable federal  regulation and was governed by a specific contract clause on government  property, providing for title to property to pass to the Navy as the ships  were constructed.
section_title: Key Contract Terms Related to Quality Were Not Exercised
paragraphs: The cost-reimbursement contracts for LCS 1 and LCS 2 contain several  quality-related terms intended to facilitate delivery of seaframes that were  complete, tested, and free of deficiencies. However, under these  contracts, the LCS 1 and LCS 2 prime contractors were only required to  give their best efforts to complete the specified work up to each contract’s  estimated cost. These efforts limited the extent to which quality-related  terms of the ships’ contracts were exercised. Table 1 provides an  overview of these quality-related contract terms and identifies whether  they were fully executed for LCS 1 and LCS 2.
Most notably, the Navy did not conduct final contract trials for LCS 1 or  LCS 2. Normally, sea trials—including final contract trials—require 4 to 5  days to complete and are graded evaluations by INSURV, which identify  whether the ship’s material condition is satisfactory, degraded, or  unsatisfactory. Alternatively, for LCS 1, the Navy completed an  abbreviated 2-day special trial in May 2012, which was ungraded by  INSURV and showed both residual and new deficiencies. Final contract  trials are intended to provide important information on ship performance  toward the end of the guaranty period. Special trials are not intended to  substitute for the more rigorous final contract trials.
LCS 2, on the other hand, has never even completed its acceptance  trials. Prior to delivery in 2009, the Navy decided to split the acceptance  trials for LCS 2 into two parts because the ship was incomplete and  unfinished when initial acceptance trials got underway. The second,  remaining portion of the acceptance trials—intended to demonstrate  several of the ship’s untested combat systems—was scheduled for  completion in summer 2010. However, the Navy subsequently never held  these trials and, in August 2014, completed a 1-day ungraded special trial  for LCS 2—approximately 4 years after it took final acceptance of the  ship.
The Navy’s decision to not complete key LCS 1 and LCS 2 trials is  inconsistent with the program office’s earlier plans and agreements with  INSURV—the Navy organization responsible for conducting trials. The  LCS program office initially planned to hold two separate sets of  acceptance trials for both LCS 1 and LCS 2. However, aside from splitting  each ship’s acceptance trials, INSURV officials stated that LCS 1 and  LCS 2 were otherwise expected to follow the normal trials and  acceptance process. Yet, in light of the program office’s later decision to  not make LCS 2 available for its second set of planned acceptance trials,  INSURV officials told us they were unlikely to agree to conduct trials on  future ships in a similar manner. INSURV officials did note, however, that  they recognize that Freedom variant ships built at Marinette Marine face  environmental and treaty limitations that compel the need for two sets of  acceptance trials, although the scope of testing that has to be deferred  from the Great Lakes is—and should continue to be—minimal.
section_title: Navy Acceptance Decisions Took Full Advantage of Waivers Allowed under Policy to Circumvent Guidelines for Delivering Defect- Free Ships
paragraphs: Navy policy requires robust standards to be met prior to a ship’s delivery  and continuing through the end of the guaranty period—standards that  LCS 1 and LCS 2 did not meet.policy include the following:   Key quality standards contained in this
Ships and submarines will be fully mission capable, in the sense that  all contractual and governmental responsibilities shall be resolved  prior to the Navy accepting delivery (preliminary acceptance), except  for crew certification, outfitting, or special Navy range requirements  which cannot be met until after delivery.
Delivery of the ship is based on acceptance trials and satisfactory  correction or resolution of deficiencies, and acceptance trials shall be  conducted when all work, including the correction of significant known  deficiencies, has been completed.
Final contract trials are to be conducted at sea and should have  operations at full power and be of sufficient thoroughness to  determine whether defects have developed since acceptance trials.
However, the policy also provides certain flexibilities that allow the Navy  to conduct sea trials for and accept delivery of a ship with deficiencies.  These flexibilities enabled the Navy to defer certain work on LCS 1 and  LCS 2 until after preliminary and final acceptances. Most notably, the  policy allows for the following:
Deferring work until the post-delivery period before the vessel is  transferred to the fleet, if determined to be prudent—for example,  because of financial or workload reasons.
In cases of new construction efforts, leaving significant ship  systems/capabilities incomplete until the end of post shakedown  availability.
Finally, the policy also provides for waiver requests, to be used in  extraordinary circumstances, to the Chief of Naval Operations to provide  for deviation from the policy. To facilitate the LCS 1 and LCS 2  acceptance processes, the program office obtained waivers for several  provisions of the policy, which permitted the Navy to undertake the  following activities on LCS 1 and LCS 2:
Conduct acceptance trials with significant construction deficiencies.
Accept delivery of the ships with uncorrected starred deficiencies.
section_title: Navy Decisions to Accept Ships in Deficient Condition Driven by Cost and Fleet Needs, and Quality Problems Persist
paragraphs: Navy decisions to accept delivery of LCS 1 and LCS 2 in incomplete,  deficient conditions were driven by a focus on near-term cost  performance by shipbuilders, a desire to introduce the long-delayed ships  to the fleet, and—in the case of LCS 1—environmental and treaty  considerations associated with the location of that ship’s construction. In  prioritizing these factors, the Navy shortchanged its quality assurance  processes for both ships, which has caused it to devote considerably  more time and money to resolving deficiencies post-delivery than  anticipated. However, because the Navy did not establish clear deadlines  for resolving ship deficiencies, corrections were allowed to lag, to the  point that fleet operators inherited unresolved starred deficiencies on  each seaframe. Further, these deficiencies have constrained recent  shipboard operations.
subsections: section_title: Navy Rationale for Accepting Deficient Ships Driven by Cost and Fleet Needs
paragraphs: Key factors that motivated the Navy to accept delivery LCS 1 and LCS 2  in incomplete, deficient conditions include (1) a desire to improve the  contractors’ cost performance and (2) prioritization of fleet introduction, so  as to begin experimenting with the ships and demonstrating operational  and sustainment concepts. In addition, environmental limitations related  to testing and transport compelled the Navy’s acceptance schedule for  LCS 1. However, in most cases the outcomes of the Navy’s decisions  were not as initially intended.
subsections: section_title: Desire to Improve Cost Performance
paragraphs: In the final months leading up to the eventual deliveries of LCS 1 and  LCS 2, the prime contractors consistently increased their cost estimates  for completing the ships. For LCS 1 and LCS 2, contractor cost estimates  increased 3.6 percent and 9.8 percent, respectively, in the 5 months  preceding those ships’ deliveries. These increases were in addition to  cost growth totaling over 150 percent that the Navy had previously  incurred on each contract. According to LCS seaframe program officials,  the LCS shipbuilders did not have strong incentives to complete the ships  and deliver them to the Navy, in part because of the cost-reimbursement  contracts that were in place. Consequently, the Navy pushed the delivery  process forward for the ships—despite incomplete work and  deficiencies—once the ships met minimal safe-to-sail conditions.
According to LCS seaframe program officials, the program was confident  that lower pricing for remaining work could be obtained after delivery by  using different shipyards than Marinette Marine and Austal USA, where  LCS construction took place. However, the Navy may not have achieved  these anticipated cost benefits. Most notably, the Navy did not assess  whether the eventual post-delivery shipyards—including Colonna’s  Shipyard (Norfolk, Virginia), BAE Systems Ship Repair (San Diego,  California and Norfolk, Virginia), and General Dynamics NASSCO (San  Diego, California)—would provide better pricing than the original  construction yards. Instead, SUPSHIP officials reported that the Navy  only completed assessments as to whether the eventual post delivery  shipyards’ pricing was fair and reasonable as compared to other  shipyards in their own respective geographic areas. These geographic  areas did not include Wisconsin or Alabama, where Marinette Marine and  Austal USA—the original LCS construction yards—are located,  respectively.
The cost-reimbursement type contracts used to construct LCS 1 and LCS  2 included both incentive and award fees to incentivize contractor  performance. The incentive fee was designed to reward the contractor for  controlling contract costs by increasing the fee when the costs incurred  during contract performance were less than the contract’s target cost.  Work performed after delivery during the guaranty period, such as  correction of deficiencies, was reimbursable without fee to the   For completion of the work remaining on both ships after the  contractor.end of the guaranty period, including deficiency corrections and emergent  work, the Navy instead created new arrangements, called basic ordering  agreements, with the two LCS prime contractors. These agreements  anticipated placement of orders on a cost-plus-fixed-fee, cost-plus-award- fee, or fixed price basis. Most of the orders we reviewed were placed on a  cost-plus-fixed-fee basis, where the contractor is reimbursed for its  allowable incurred costs to the extent prescribed in the contract, and  receives a fee that is fixed at the outset. These new agreements allowed  Navy program officials to reprioritize work based on available funding and  the ships’ testing schedules. However, in contrast to the incentive fees  used under the original construction contracts, cost-plus-fixed-fee  contracts provide the contractor only a minimum incentive to control  costs, and expose the government to increased cost risk.did not conduct a robust analysis of pricing for post delivery work among  alternative shipyards—including the original LCS construction yards—and  the contract structure used for post delivery work did not provide the  contractors with incentives to control costs, it is unclear whether LCS 1  and LCS 2 cost performance improved or deteriorated as compared to  previous performance within the original construction shipyards and under  the original contract structure.
section_title: Prioritization of Fleet Introduction
paragraphs: As we previously found in 2010, LCS 1 and LCS 2 experienced significant  delivery delays—20 months and 26 months, respectively—as compared  to their initial planned delivery dates. These delays occurred in an  environment where senior Navy leaders placed a high priority on  introducing the ships to the fleet with haste in order to begin  experimenting with and demonstrating LCS operational and sustainment  concepts, which would help inform design changes to later ships in the  class. Most notably, the program’s 2004 acquisition strategy included a  directive from the Chief of Naval Operations to “get the hulls into the  water with the speed of heat.”
The Navy’s decision to accept delivery of LCS 1 without fully correcting  starred deficiencies contributed to that ship’s availability to complete a  limited deployment in 2010 nearly 2 years ahead of plan, albeit with  significant mission constraints. This deployment positioned the Navy to  begin developing a life-cycle maintenance strategy for critical equipment  on the Freedom variant. In July 2014, we identified operational lessons  learned as part of the ship’s 2013 deployment to Singapore, including  equipment reliability and crew maintenance practices. With LCS 2,  although the Navy also accepted delivery before correcting starred  deficiencies, opportunities to capitalize on this ship’s availability for fleet  use have been more constrained. As we previously found in 2013, the  combat management system software on that ship was incomplete at  delivery, and as of December 2012—3 years after ship delivery— questions remained among the LCS 2 crew about both the combat  management system and radar. Most significantly, the crew had obtained  minimal operational experience with both systems, and integration of  weapon and sensor capabilities into the combat system remained  incomplete.  Even as of August 2014, the combat management system  continued to face significant limitations, which has restricted its use during  fleet operations.
section_title: Environmental and Treaty Limitations
paragraphs: Navy officials reported that for LCS 1, environmental and treaty  constraints also contributed to its delivery acceptance decision for that  ship. These officials stated that the treaty constraints prevented the  testing of certain ship systems, including weapon systems, during  acceptance trials in the Great Lakes. Further, the ship’s September 2008  delivery was timed, in part, to facilitate transiting the ship out of the Great  Lakes and into the Atlantic Ocean before the St. Lawrence Seaway  closed for the winter due to ice. These environmental and treaty  limitations caused the Navy to split acceptance trials for LCS 1 into two  parts—one within the Great Lakes, and a second trial in the Atlantic  Ocean. However, the scope of testing deferred into LCS 1’s second acceptance trial included items that the Navy could have tested while in  the Great Lakes, but was prevented from doing so because of incomplete  and deficient work. These items include the 11-meter rigid-hull inflatable  boat and recovery winch, electrical load shedding and distribution  systems, and splitter gears, among others.
section_title: Decisions to Accept Incomplete and Deficient Seaframes Have Produced Subpar Post- Delivery Outcomes
paragraphs: When the Navy accepted delivery of LCS 1 and LCS 2, it anticipated  significantly less time and money would be required to address quality  problems than has actually been required. Instead, the aftermath of  delivery for each of these ships has been characterized by significant cost  growth, schedule delays, and the transfer of deficient ships to operational  communities.
subsections: section_title: Additional Deficiencies Identified Following Deliveries
paragraphs: In 2013, we found that the Navy accepted delivery of LCS 1 and LCS 2  with unresolved starred deficiencies affecting both ships. The Navy also  deferred testing and certifications of numerous other ship systems and  pieces of equipment as part of initial acceptance trials for these ships.  Therefore, the Navy chose to accept delivery of both LCS 1 and LCS 2  without the benefit of a complete INSURV inspection to identify all  deficiencies. Subsequent trials held after the delivery of LCS 1 identified  additional deficiencies. LCS 2 has not yet been made available for a  complete inspection by INSURV. Further, the Navy executed the first part  of LCS 2’s acceptance trials despite a considerable amount of incomplete  work remaining throughout ship compartments. Comparatively fewer  compartments were incomplete on LCS 1 for that ship’s initial acceptance  trials, but these incomplete areas included engine machinery spaces  critical for demonstrating ship capabilities. Table 2 details LCS 1 and LCS  2 trial events and the key quality metrics identified at each event.
On both LCS 1 and LCS 2, the Navy deferred testing of systems,  including key weapons systems such as the 57-millimeter gun, until after  the ships’ first set of acceptance trials. Further, mission package  equipment—critical to LCS mission execution—was not tested as a part  of either ship’s acceptance trials. Consequently, key interfaces between  the seaframes and mission package equipment—particularly, seaframe  launch, handling, and recovery systems—remained undemonstrated at  initial acceptance trials. Further, neither ship had acquired required third- party certifications for certain navigation, aviation, and tactical data link  systems. Consequently, the Navy was not able to fully demonstrate the  uncertified systems prior to delivery.
As LCS 1 trials events progressed, INSURV was able to inspect and  demonstrate systems and equipment that were not available during that  ship’s first set of acceptance trials. These inspections and demonstrations  resulted in additional starred deficiencies for the ship, in some cases, but  also increased the Navy’s knowledge related to the ship’s capabilities. To  date, however, INSURV has not completed similar follow-on inspections  and demonstrations for LCS 2 systems and equipment. August 2014  special trials tested only four of the systems that the Navy excluded from  inspection—or that failed inspection—during that ship’s initial acceptance  trials.
section_title: Post-Delivery and Outfitting Costs Have Grown to Address Deficiency Corrections and Complete Construction
paragraphs: The Navy has relied on RDT&E funds budgeted for post-delivery and  outfitting activities to remedy LCS 1 and LCS 2 deficiencies and complete  construction of these ships. As the Navy has identified additional LCS 1  and LCS 2 deficiencies following delivery of those ships, post-delivery  and outfitting funding obligations to address the deficiencies have grown.  Tables 3 and 4 below highlight the significant cost growth that the LCS 1  and LCS 2 post-delivery and outfitting accounts have incurred in the  years since those ships delivered.
Although the Navy identifies LCS 1 and LCS 2 outfitting and post-delivery  funds within its RDT&E construction budget, it does not include these  funds when calculating the total construction costs. Instead, Navy budget  documents separate out funding for post-delivery and outfitting activities  as “non-end cost” items for LCS 1 and LCS 2—a practice that obscures  the true construction costs of these ships.
The Navy has obligated some portion of LCS 1 and LCS 2 post-delivery  and outfitting funds to activities other than completion of ship construction  and correction of deficiencies. For instance, the Navy has funded  activities such as emergent work and addition of crew amenities.  However, seaframe program officials stated that these outfitting activities  for the two hulls were minimal, and they were unable to further clarify  these totals for us.
section_title: Fleet Ready Dates Delayed by Need to Correct Deficiencies
paragraphs: Obligation and work limiting dates establish deadlines that drive the  acquisition community to do its part to bring a ship up to required  specifications ahead of turning it over to the fleet. For an SCN funded  ship, the obligation and work limiting date is set for 11 months following  completion of outfitting for the ship. However, because the Navy  constructed LCS 1 and LCS 2 using RDT&E appropriations, it was not  required to set obligation and work limiting dates for these ships, and  identification and correction of deficiencies was allowed to lag beyond  normal timelines for Navy ships. In addition, post-delivery work periods— aimed at correcting LCS 1 and LCS 2 deficiencies—consumed more time  than the Navy anticipated when it accepted delivery. Because  deficiencies were not corrected in a timely manner, the ships were  delayed in becoming fleet ready, or capable of executing required mission  sets. These delays totaled approximately 1.5 years for LCS 1 and 6  months for LCS 2—although incomplete trials for LCS 2 call into question  the Navy’s basis for declaring that ship as fleet ready.
Figures 2 and 3 highlight the effect of unanticipated extensions to LCS 1  and LCS 2 post-delivery work periods and delays achieving fleet  readiness following delivery of those ships to the Navy.
Although significant increases in funding and time devoted to post- delivery work have occurred, the program office did not fully resolve LCS  1 and LCS 2 starred deficiencies before it judged the ships as fleet ready.  Once a ship is judged fleet ready—and subsequently transferred to the  fleet for operations—responsibility for funding and scheduling correction  of any remaining deficiencies shifts from the acquisition program office to  the operational community. Figure 4 illustrates the number of starred  deficiencies transferred from the program office to the fleet for both LCS 1  and LCS 2.
When a ship is transferred to the fleet with uncorrected deficiencies, the  fleet determines whether to fund repair of the deficiencies—using  Operations and Maintenance, Navy appropriations—or to simply  document the deficiencies as part of the ship’s material history. For LCS 1  and LCS 2, program officials reported that the fleet has elected to correct  some deficiencies while leaving others uncorrected.
However, these uncorrected deficiencies have constrained recent  shipboard operations. For example, during LCS 1 acceptance trials in  2008 and 2009, the Navy deferred testing of the ship’s launch, handling,  and recovery system. Following these deferrals, fleet operators reported  problems with system components—including, in 2013, the hoist motor  and brake—indicating that the system was not performing adequately,  and subsequently constraining mission readiness. On LCS 2, persisting  deficiencies with the ship’s combat systems software have imposed  operational limitations that constrain the ship’s ability to employ its 57- millimeter gun. Further, INSURV documented that the Fire Scout vertical  take-off and landing tactical unmanned aerial vehicle remains untested by  INSURV on both seaframes. According to seaframe program officials, the  Navy’s inventory of these vehicles is overloaded with real world tasking,  and none have been made available to the LCS program for testing or  demonstration.
section_title: Concluding Observations
paragraphs: The Navy complied with FAR requirements in accepting LCS 1 and LCS  2, largely due to its use of cost-reimbursement contracts for these ships.  At the same time, however, this contract type allowed some quality  requirements to go unexecuted. Further, program officials did not  establish obligation and work limiting dates for LCS 1 and LCS 2— unrequired because research and development appropriations funded  these ships’ constructions—which allowed the Navy to deviate from  disciplined and timely trials processes that it relies upon to expose  deficiencies and prove out corrective fixes. The Navy’s priority was to  accelerate the ships’ entry into the fleet. This accelerated schedule,  however, spurred a need for extensive and costly post-delivery  maintenance periods to correct deficiencies. Ultimately, the ships’  contributions to fleet activities were delayed and constrained.
Because our review was focused exclusively on LCS 1 and LCS 2, which  the Navy accepted delivery of several years ago and has since  transferred to the fleet, the opportunity to implement changes to the  acquisition of these two ships has passed. In addition, the Navy is  acquiring the remaining LCS seaframes under fixed-price incentive type  contracts. Consequently, we are not making recommendations in this  report.
section_title: Agency Comments and Our Evaluation
paragraphs: We provided a draft of this report to DOD for comment. In its written  comments, which are reprinted in appendix II, DOD acknowledged receipt  of the draft report. DOD also provided technical comments that we  incorporated into the report, as appropriate.
We are sending copies of this report to interested congressional  committees, the Secretary of Defense, and the Secretary of the Navy. In  addition, the report is available at no charge on the GAO website at  http://www.gao.gov.
If you or your staff have any questions about this report, please contact  me at (202) 512-4841 or mackinm@gao.gov. Contact points for our  Offices of Congressional Relations and Public Affairs may be found on  the last page of this report.
section_title: Appendix I: Scope and Methodology
paragraphs: This report evaluates the Navy’s acquisition of the first two Littoral  Combat Ships (LCS). Specifically, we (1) assessed the extent to which  the Navy complied with applicable federal regulations, contracts, and  policies in accepting LCS 1 and LCS 2 and (2) evaluated the basis for  and outcomes from the Navy’s decision to accept delivery of these ships.
To assess the extent to which the Navy complied with applicable federal  regulations, contracts, and policies in accepting LCS 1 and LCS 2, we  identified ship acceptance requirements outlined in the Federal  Acquisition Regulation (FAR), including part 46; Department of Defense’s  (DOD) FAR Supplement (DFARS), including subpart 246.5; Navy  policies, including Office of the Chief of Naval Operations Instruction  (OPNAVINST) 4700.8H, Trials, Acceptance, Commissioning, Fitting Out,  Shakedown, and Post Shakedown Availability of U.S. Naval Ships  Undergoing Construction or Conversion (Dec. 5, 1990); and the LCS 1  and LCS 2 contracts. We identified the Navy’s acceptance process for  LCS 1 and LCS 2 by reviewing program acquisition strategies, trial  schedules and reports, material inspection and receiving reports,  deficiency waivers from the Chief of Naval Operations, and monthly Navy  Supervisor of Shipbuilding, Conversion, and Repair (SUPSHIP) briefings.  We compared the Navy’s LCS 1 and LCS 2 acceptance process against  the stated requirements. In addition, we corresponded in writing with the  Navy’s assistant general counsel for research, development and  acquisition to better understand how the LCS 1 and LCS 2 acceptance  process complied with the acceptance requirements of subpart 46.5 of  the FAR. We also relied on our prior work evaluating the LCS program  and shipbuilding quality best practices to supplement the above analyses.
To evaluate the basis for and outcomes from the Navy’s decisions to  accept LCS 1 and LCS 2, we reviewed Navy and contractor documents  detailing construction plans, costs, and schedules, including weekly  SUPSHIP briefings, contracts, and earned value management reports.  We also evaluated LCS 1 and LCS 2 trial plans and results and deficiency  correction plans, as outlined in program acquisition strategies, SUPSHIP  and program office briefings, Navy Board of Inspection and Survey  (INSURV) reports, and budget documentation. These steps enabled us to  identify the key factors responsible for the Navy’s decision to accept  these ships. We also reviewed post-delivery basic ordering agreements,  progress briefings, and Navy budget submissions to assess whether the  Navy achieved the post-delivery cost efficiencies it anticipated when  accepting delivery of LCS 1 and LCS 2. We reviewed 2013 fleet reports  on equipment casualties to assess the extent to which deficiencies  identified at LCS 1 and LCS 2 acceptances persisted when those ships  were turned over to the fleet, and what effect those deficiencies have had  on recent fleet operations. To determine the number and type of  deficiencies for each vessel, we obtained and used data from the Navy’s  Technical Support Management (TSM) system. TSM is the primary  database SUPSHIP uses to track the status of new ship construction  deficiencies. We analyzed these data to determine the total number of  open, starred deficiencies at key intervals including (1) when the Navy  accepted delivery of each ship (preliminary acceptance); (2) at the end of  each ship’s guaranty period, approximately 8 months following  preliminary acceptance; and (3) when the ships were transferred to the  fleet, which the Navy indicated occurred in February 2013 for LCS 1 and  February 2014 for LCS 2. Total starred deficiencies are those identified  during acceptance trials. The data we collected represents the  deficiencies at a particular moment in time. Further, deficiencies may be  subdivided into multiple deficiencies or consolidated into a smaller  number when the Navy and its shipbuilding contractors determine  whether the government or the shipbuilder is responsible for correcting  the respective deficiencies. We reviewed existing information about the  data and the system that produced them, including previous data  reliability testing performed on the same data collected for previous  engagements on Navy shipbuilding, and interviews with agency officials  knowledgeable about the data. We determined that the TSM data were  sufficiently reliable for the purposes of this report for the ships we  reviewed.
To further corroborate documentary evidence and gather additional  information in support of our review for both objectives, we conducted  interviews with relevant Navy and contractor officials responsible for  managing LCS 1 and LCS 2 contracts, construction, acceptances, and  post-delivery activities, including the Program Executive Office, LCS; LCS  seaframe program office; LCS fleet introduction program office;  SUPSHIP; INSURV; Office of the Chief of Naval Operations—Surface  Warfare directorate; Naval Sea Systems Command (NAVSEA)— Contracts directorate; Lockheed Martin and Marinette Marine (LCS 1  prime contractor and shipbuilder); General Dynamics and Austal USA  (LCS 2 prime contractor and shipbuilder); and the American Bureau of  Shipping. We also held discussions with attorneys from NAVSEA and the  Office of the Assistant Secretary of the Navy for Research, Development  and Acquisition.
We conducted this performance audit from November 2013 to September  2014 in accordance with generally accepted government auditing  standards. Those standards require that we plan and perform the audit to  obtain sufficient, appropriate evidence to provide a reasonable basis for  our findings and conclusions based on our audit objectives. We believe  that the evidence obtained provides a reasonable basis for our findings  and conclusions based on our audit objectives.
section_title: Appendix II: Comments from the Department of Defense
section_title: Appendix III: GAO Contact and Staff Acknowledgments
subsections: section_title: GAO Contact
section_title: Staff Acknowledgments
paragraphs: In addition to the contact named above, key contributors to this report  were Diana Moldafsky, Assistant Director; Christopher R. Durbin, Analyst  in Charge; George Bustamante; Laura Greifner; Kristine Hassinger;  Heather B. Miller; Roxanna T. Sun; and Ozzy Trevino.
section_title: Related GAO Products
paragraphs: Littoral Combat Ship: Additional Testing and Improved Weight  Management Needed Prior to Further Investments. GAO-14-749.  Washington, D.C.: July 30, 2014.
Littoral Combat Ship: Deployment of USS Freedom Revealed Risks in  Implementing Operational Concepts and Uncertain Costs. GAO-14-447.  Washington, D.C.: July 8, 2014.
Navy Shipbuilding: Opportunities Exist to Improve Practices Affecting  Quality. GAO-14-122. Washington, D.C.: November 19, 2013.
Navy Shipbuilding: Significant Investments in the Littoral Combat Ship  Continue Amid Substantial Unknowns about Capabilities, Use, and Cost.  GAO-13-738T. Washington, D.C.: July 25, 2013.
Navy Shipbuilding: Significant Investments in the Littoral Combat Ship  Continue Amid Substantial Unknowns about Capabilities, Use, and Cost.  GAO-13-530. Washington, D.C.: July 22, 2013.
Defense Acquisitions: Realizing Savings under Different Littoral Combat  Ship Acquisition Strategies Depends on Successful Management of  Risks. GAO-11-277T. Washington, D.C.: December 14, 2010.
National Defense: Navy’s Proposed Dual Award Acquisition Strategy for  the Littoral Combat Ship Program. GAO-11-249R. Washington, D.C.:  December 8, 2010.
Defense Acquisitions: Navy’s Ability to Overcome Challenges Facing the  Littoral Combat Ship Will Determine Eventual Capabilities. GAO-10-523.  Washington, D.C.: August 31, 2010.
Littoral Combat Ship: Actions Needed to Improve Operating Cost  Estimates and Mitigate Risks in Implementing New Concepts.  GAO-10-257. Washington, D.C.: February 2, 2010.
Best Practices: High Levels of Knowledge at Key Points Differentiate  Commercial Shipbuilding from Navy Shipbuilding. GAO-09-322.  Washington, D.C.: May 13, 2009.
Defense Acquisitions: Overcoming Challenges Key to Capitalizing on  Mine Countermeasures Capabilities. GAO-08-13. Washington, D.C.:  October 12, 2007.
Defense Acquisitions: Plans Need to Allow Enough Time to Demonstrate  Capability of First Littoral Combat Ships. GAO-05-255. Washington, D.C.:  March 1, 2005.