Coast Guard: Condition of Some Aids-to-Navigation and Domestic Icebreaking Vessels Has Declined; Effect on Mission Performance Appears Mixed
Released: 2006-10-23T00:00:00

Letter

Background

The US Coast Guard is a multimission, maritime military service within the Department of Homeland Security. The Coast Guard has responsibilities that fall under two broad missions—homeland security and non–homeland security. (See table 1.)

One of the Coast Guard’s strategic goals is maritime mobility, that is, to facilitate maritime commerce, eliminate interruptions and impediments to the movement of goods and people, and maximize access to and enjoyment of the water. The two non-homeland security missions through which the Coast Guard achieves this goal are aids–to-navigation (ATON) and domestic icebreaking, which is part of ice operations.

Aids-to-Navigation Mission Through its ATON mission, the Coast Guard promotes safe waterways and an efficient Marine Transportation System. The Coast Guard has statutory responsibility to operate and maintain a system of maritime aids to facilitate navigation and to prevent disasters, collisions, and wrecks. To fulfill this mission, the Coast Guard operates over 53,000 aids. These aids- to-navigation are like road signs of the waterways and are placed along coasts and navigable waters as guides to mark safe water and to assist mariners in determining their position in relation to land and hidden dangers. These aids consist of both floating aids, such as buoys, and fixed aids, such as lights or signs mounted on pilings. See figure 1 for an example of a buoy and fixed aid-to-navigation.

The Coast Guard uses several types of vessels to place and service its aids- to-navigation such as buoy tenders, construction tenders, and boats that make up its ATON fleet. These vessels are used to perform both periodic routine maintenance of aids and discrepancy response, when, for example, a light is extinguished or a buoy is moved from its intended location. The assets are shown in table 2.

Domestic Icebreaking Mission

Domestic icebreaking is a key component of the Coast Guard’s ice operations mission, which facilitates the safe and efficient navigation on lakes, rivers, channels, and harbors during the winter season. The Coast Guard has statutory icebreaking responsibilities that are additionally addressed by an executive order that directs the Coast Guard to break ice in channels and harbors in order to keep them open to navigation. Like plowing snow-covered roads, the Coast Guard keeps areas of water open as much as is reasonably possible for commercial traffic in winter. It also performs icebreaking for search and rescue and prevention of flooding by ice. To conduct this mission, the Coast Guard uses assets that are specially designed with strengthened hulls. The key icebreaker types the Coast Guard uses are shown in table 3.

The Coast Guard classifies its vessel assets, such as those used in the ATON and domestic icebreaking missions, as cutters (assets 65 feet long or longer with adequate accommodations for crew to live on board) or boats (assets less than 65 feet in length that usually operate near shore and on inland waterways). For purposes of this report, the three main asset groups are ATON cutters, ATON boats, and domestic icebreakers.

Icebreaking and ATON Assets Show Significant Increases in Time Spent on Homeland Security Missions since 2001

Since 2001, the Coast Guard’s domestic icebreakers and ATON cutters have experienced significant increases in the time spent conducting missions related to homeland security. Most of this increase has come in the Ports, Waterways and Coastal Security (PWCS) mission, which involves such activities as conducting security patrols and escorting vessels. The increase was greatest for domestic icebreakers, which continue to be used more for homeland security missions than for icebreaking because of their availability during months when no icebreaking is needed. By contrast, ATON cutters and boats still spend most of their time on ATON-related activities, reflecting the year-round nature of the ATON mission. Some newer ATON cutters with greater multi-mission capabilities, however, continue to have a more diverse workload. Coast Guard officials said icebreakers and ATON vessels, while less than ideal for carrying out security missions, can perform these missions adequately.

Domestic Icebreakers Show the Largest Increase in Time Spent on Homeland Security Missions

During fiscal years 2001 through 2005, the domestic icebreakers divided their time between several of the Coast Guard’s 11 missions, but PWCS activities accounted for roughly half of all resource hours during fiscal years 2002 through 2005. PWCS activities grew quickly from 15 percent of total resource hours in fiscal year 2001 to 53 percent in fiscal year 2002, and they have remained at 44 percent or more of total hours through fiscal year 2005. At the same time, icebreaking hours began at 41 percent in fiscal year 2001 and then dropped down to 13 percent in 2002, but ended at 26 percent in fiscal year 2005. The vast majority of this increase in PWCS has occurred in the New York City area with smaller increases in other East Coast ports. As figure 2 shows, the increase came about largely by adding to the total number of hours these assets were operated. The total number of resource hours for these assets grew from about 12,000 hours in fiscal year 2002 to a high of about 20,000 the following year.

The increase in PWCS hours for domestic icebreakers mainly reflects their availability during those months when no icebreaking needs to be done. Icebreaking needs are typically greatest from December 15 to April 15. Coast Guard officials said that because icebreakers do not have a primary summertime mission, using them to conduct PWCS missions during slack periods has not limited the Coast Guard’s ability to conduct routine icebreaking missions. Icebreaking hours, however, did see some marked shifts during this period—most notably a decrease in fiscal year 2002 followed by a substantial increase in fiscal year 2003. The decrease in 2002 appears related to two main factors: a mild winter, during which the Great Lakes region was virtually free of ice throughout December and most of January, and a change in the way the Coast Guard accounted for its use of icebreakers. The Coast Guard does not record resource hours under two mission categories simultaneously, and prior to the attacks on September 11, 2001, resource hours used to break ice while escorting a vessel with hazardous cargo would only have been recorded as ice operations. After the attacks, these same hours could be logged either as PWCS or icebreaking at the discretion of the vessel’s commanding officer. The increase in ice operations hours for fiscal year 2003 reflected an unusually severe winter in the Great Lakes.

Increased workloads have placed some icebreakers above the maximum number of recommended operating hours for the assets. The maximum recommended operating level, called an “underway hours limit,” reflects maximum use established from planning documents, missions, and maintenance requirements, and historic use. In particular, the 65-foot small harbor tug fleet exceeded their underway hours limit from fiscal years 2001 to 2003 by increasingly more hours, starting with being 10 hours over the underway limit in 2001 and progressing to nearly 2,000 hours over the underway limit in 2003. In contrast, the 140-foot icebreaking tugs were operated within their underway hours limit from 2001 to 2005.

Coast Guard officials said domestic icebreakers, while not their vessel of choice for maritime security missions, can perform all PWCS missions adequately except for shore side patrols. The Coast Guard’s 87-foot coastal patrol boats are the preferred assets for PWCS missions. Commissioned since 1998, these boats can travel at up to 25 knots and have a system that allows the crew to launch and recover small boats. Relative to these vessels, domestic icebreakers show both advantages and disadvantages (see table 4). Icebreakers are more capable of operating in cold weather, and their substantial size provides a significant presence on the waterways, but they are slower, less able to launch small boats, and pose increased training challenges for training crews in law enforcement.

Increase in Homeland Security Missions Is Less Extensive for ATON Assets

ATON assets also experienced an increase in use for homeland security missions after September 11, 2001, but to a much lesser degree than for domestic icebreakers. Overall, ATON assets were used for several of the Coast Guard’s missions during fiscal years 2001 through 2005, but ATON remained the primary mission, accounting for more than 85 percent of the fleet’s total resource hours for fiscal years 2001 to 2005. Time spent in PWCS activities increased from 4 percent of total resource hours in fiscal year 2001 to 10 percent in fiscal year 2002; since then, PWCS mission hours have steadily decreased (see fig. 3). Overall, PWCS activities accounted for 6 percent of resource hours during the period.

When resource hours are analyzed more closely by type of ATON asset, there are significant differences in the amount of hours used for the PWCS mission. The increase in PWCS resource hours came primarily from cutters (vessels ranging in length from 65 to 225 feet). Overall, ATON activities account for about 79 percent of total resource hours for the cutters, compared with about 90 percent for ATON boats (vessels less 65 feet in length). ATON boats were the only vessels that did not have as much of an increase in PWCS resource hours immediately after the attacks on September 11, 2001, though their use in PWCS activities did rise in fiscal year 2003. Among the ATON cutters, the newer cutters have greater multiple mission capabilities and consequently tend to be used more often in other missions. For example, ATON cutters acquired between 1944 and 1976 performed an average of 4 of the Coast Guard’s 11 missions during fiscal years 2001 through 2005, while the 225-foot seagoing buoy tender, which the Coast Guard completed the acquisition of in 2004, was used in all 11 of the Coast Guard’s missions in fiscal years 2004 through 2005.

Available Evidence Indicates Condition of Assets Varies Greatly and Mixed Impact on Mission Performance

The available evidence does not give a consistent picture of how usage trends may be affecting the condition of these assets and, ultimately, the Coast Guard’s ability to meet performance goals for icebreaking and ATON missions. We analyzed three types of evidence related to condition—the Coast Guard’s primary measure for reporting asset condition, overall trends in maintenance expenditures on each type of asset, and a body of anecdotal evidence gathered primarily through interviews with Coast Guard personnel and site visits to various installations. The Coast Guard’s primary condition measure shows some assets meeting the operating standard and others falling below it. However, the current measure for asset condition is not clearly linked to mission performance, but the Coast Guard is working on developing a measure that links the two. Trends in maintenance costs and the anecdotal evidence we gathered tend to indicate that asset conditions are declining, though not substantially beyond what Coast Guard officials said they would expect for vessels of this age. Performance indicators for the icebreaking and ATON missions likewise show mixed results, with the Coast Guard meeting some performance goals and not meeting others. In part, these mixed results can be explained by the many other factors besides asset condition, such as the severity of weather in any given year.

Current Condition Measure Is Limited and Does Not Show a Clear Pattern in Asset Condition

For icebreaking and ATON cutter assets, the Coast Guard’s key summary measure of condition shows mixed results. This measure—percent of time free (POTF)—of major casualties has been mixed. The Coast Guard’s standard is 72 percent or better. Measured against this standard for fiscal years 2000 through 2004, the various types of icebreakers and ATON cutters vary considerably. As table 5 shows, some assets, such as the 65-foot small harbor icebreaking tugboat and the 65- and 75-foot river buoy tenders met the standard nearly every year, while others such as the 140-foot icebreaking tugboat and the 75-foot, 100-foot, and 160-foot inland construction tenders met it either not at all or only once during the 5-year period. Fiscal year 2004 was the worst of the 5 years, with only two of the eight types of cutters meeting the standard.

The Coast Guard’s condition measure for these assets, while instructive, needs to be viewed with some caution. As we have reported in our analysis of the condition of the Coast Guard’s legacy deepwater assets, the measure captures only major equipment casualties, which degrade mission capabilities but does not capture minor equipment casualties that may also degrade mission capabilities. As such, this measure may underestimate the decline in asset condition. The Coast Guard has acknowledged the limitations of this measure and is working on a replacement for it, which will better determine specific mission impacts.

The POTF condition measure applies to cutters; the Coast Guard only recently started tracking POTF data for assessing condition trends on ATON small boats. During the fiscal year 2000 through 2004 period we reviewed, the Coast Guard did not have a centralized system for tracking the condition of these boats. Its internal assessment of the condition of the boats was based on two approaches, as follows: For standard boats, which are purchased by Coast Guard headquarters and have similar capabilities and equipment for all boats of a particular type, the Coast Guard assessed condition by determining the boats’ remaining service lives through a process referred to as ship structure and machinery evaluation boards (SSMEB). The SSMEB, which is conducted 10 years after a boat is commissioned and is repeated at 5-year intervals, applied to two of the six types of ATON boats we reviewed.

For nonstandard boats, which are purchased by individual Coast Guard units for individual needs, the Coast Guard’s assessment was based on anecdotal information from district boat managers, maintenance managers, annual boat inspection reports, and site visits. This approach was used on four of the six types of boats we reviewed.

Using these approaches, the Coast Guard characterized most of these asset types as in fair to poor condition. By contrast, however, when the Coast Guard assembled POTF data for a portion of these boats in fiscal year 2005, the data did not support this assessment. The boats analyzed had average scores above the Coast Guard’s goal of 72 percent. (App. III provides further details on condition measures for each of the ATON and domestic icebreaking assets.)

Increasing Maintenance Costs Indicate Possible Condition Issues

For our second measure—trends in maintenance expenditures—the picture with regard to condition is more consistent than for our first measure: maintenance expenditures for domestic icebreaking and ATON cutters are increasing, even after taking inflation into account. We analyzed three types of maintenance costs: Scheduled maintenance costs, which are planned for in advance and include such things as repainting the vessel; Unscheduled maintenance costs, which are for unforeseen emergencies; and Engineering Logistic Center (ELC) costs, which include fleetwide projects that require engineering assistance (such as checking for watertight integrity) and therefore cannot be handled at the unit level. These projects, such as replacing a generator, help sustain capability but do not enhance it, according to Coast Guard officials.

While there are some asset-by-asset variations, total maintenance costs for domestic icebreakers and ATON cutters increased during the period we examined (fiscal years 2001 through 2005). As figure 4 shows, total annual maintenance costs for domestic icebreakers nearly doubled, from slightly more than $3 million to slightly more than $6 million. The increase came primarily in two of the three categories in most years—scheduled maintenance costs and ELC costs. Although maintenance costs are also affected by the amount of funding available in any given year, according to Coast Guard officials, maintenance managers have discretion to move some funds to those assets most in need of maintenance money. Coast Guard officials have also said that these costs are indicative of condition issues. For example, an ELC official said that the increase in ELC costs was related to condition because the money was used for the overhaul of domestic icebreakers. In addition to the amount of funding available in any given year, these maintenance costs can also be impacted by a variety of other factors such as the pace of operations. For example, maintenance costs can be expected to increase as the pace of operations increases.

Total annual cost increases for ATON cutters showed a similar trend, more than doubling from over $13 million to over $32 million during the 5-year period (see fig. 5). For ATON cutters, cost increases were greatest in ELC maintenance and unscheduled maintenance. As with icebreakers, Coast Guard officials considered these expenditures to be related to asset condition.

Evidence Gathered from Interviews, Site Visits, and Other Records also Indicate Condition Issues

Evidence we gathered during our discussions with maintenance personnel, our visits to various Coast Guard installations, and our review of other Coast Guard records also pointed to declining condition of a number of these assets. However, according a program manager who previously served as a commanding officer on an icebreaker, for some of the older assets, the decline in condition of those assets has not been beyond what would be expected of assets 20 years or more in age. During our interviews and site visits, Coast Guard personnel reported to us that crew members have had to spend increasingly more time and resources to troubleshoot and resolve maintenance issues on older domestic icebreaking and ATON assets. They indicated that because the systems and parts are outdated compared with the technology and equipment available today, it can be challenging and time consuming to diagnose a maintenance issue and find parts or determine what corrective action to take. For example, the propulsion control system on the 140-foot icebreaking tugs uses circuit cards that were state-of-the-art when the tugs were commissioned in the late 1970s to 1980s but are no longer manufactured today and have been superseded by computer control systems (see fig. 6). Coast Guard personnel said the lack of a readily available supply of these parts has forced maintenance personnel to order custom made parts or refurbish the faulty ones, increasing the time and money it takes to address maintenance problems. Finding knowledgeable individuals to identify problems with outdated equipment is difficult, they said, which further complicates maintenance. Crews of other assets we visited also confirmed the difficulty of diagnosing problems and obtaining replacement parts for other critical subsystems such as the main diesel engines.

Since at least 2002, the Coast Guard has been on record as saying these assets are in decline. In a mission needs analysis issued that year, the Coast Guard concluded that its domestic icebreaking and ATON assets were affected in varying degrees with respect to safety, supportability, environmental compliance, and habitability, and that addressing these issues would require replacing or rehabilitating the assets. The analysis noted that the need to replace or rehabilitate inland buoy tenders and 45-foot buoy boats had been identified as early as 1993 but had not yet been addressed. It also noted that the 21-foot trailerable aids-to- navigation boats and the 55-foot aids-to-navigation boats—most of which have yet to be replaced—had been extended beyond their projected service lives.

When we asked Coast Guard officials if current usage patterns were precipitating the decline of these assets, they said that overages can have an impact on some assets, especially those with more complex systems and subsystems. The officials said that exceeding planned usage limits may leave less time to maintain these systems. They said that the deterioration of an asset and its systems from usage consistently above the limits would be reflected in periodic engineering assessments, known as SSMEBs, of the assets. In our site visits, we did learn of one example in which increased use of assets for security-related purposes may be affecting condition. The example involves the 140-foot icebreakers, which currently are being used extensively for security-related activities when they are not engaged in icebreaking activity. According to Coast Guard personnel, these icebreakers were designed to operate at maximum power for icebreaking; however, maritime security missions typically require several hours of idling, which is detrimental to the engine. Extended periods of idling, they said, causes oil discharge and sludge build up in the engine and mufflers. Thus, running assets in ways for which they were not designed could result in faster degradation of their condition.

Performance Indicators for Icebreaking and ATON Missions Show Mixed Results

Against this backdrop of condition indicators, the Coast Guard’s measures of performance for domestic icebreaking and ATON missions show mixed results, with several indicators showing that mission performance has been improving or largely unchanging, while at least one other indicator indicates a decline.

For domestic icebreaking, the Coast Guard’s performance indicator is the number of days that ice leads to closures of waterways in the Great Lakes region—the region in which most domestic icebreaking activity occurs. The Coast Guard’s performance goal is to have 2 or fewer closure days during average winters. During fiscal years 2001 through 2005 the Coast Guard met this goal every year but 1. The exception was fiscal year 2004, when waterways were closed for 4 days. According to Coast Guard officials, however, vessel condition was not a factor in waterway closures; instead, they were related to an icebreaker’s being diverted to free a stuck vessel and to a response to a commercial aircraft crash.

For ATON, the Coast Guard’s primary performance indicator is the number of collisions, allisions, and groundings. Since these events can cause deaths and injuries, environmental and property damage, and lead to waterway closures that limit commercial and recreational activity, a decline in this measure is an improvement. During fiscal years 2001 through 2005, this measure declined—a positive development (see fig. 7).

While the Coast Guard’s primary ATON performance indicator was showing improvement, however, an important secondary measure was showing an adverse effect. This indicator, which measures the probability that an aid to navigation or a system of aids-to-navigation is performing its specified function at any randomly chosen time and is expressed as a percentage of total time, is the leading performance measure used in managing the ATON program, according to Coast Guard officials. This measure has steadily declined since fiscal year 2002 (see table 6), and since a smaller percentage means fewer aids are available, a decline in this measure is an adverse development. Coast Guard officials said some of this decline was attributable to the condition of ATON cutters and boats for servicing the navigational aids, but they were not able to estimate how much of the decline could be attributed to this cause.

In other work, we have noted that the Coast Guard’s performance indicators can be affected by multiple factors and that there are challenges to using such measures in linking resources to results. The ability to meet icebreaking goals, for example, can be affected by the severity of the winter. In fact, when the Coast Guard met its goal for waterway closures in fiscal year 2005, Coast Guard officials attributed the result in part to less severe average ice conditions than in previous years. Similarly, the ability to keep navigational aids in working order can be adversely affected by such uncontrollable factors as the severity of a hurricane or winter storm season.

The Coast Guard has launched a number of initiatives designed to address challenges in linking resources to results of these missions. These initiatives followed program assessments conducted by the Office of Management and Budget, which completed an assessment of the ATON program in 2002 and the domestic icebreaking program in 2004. For the ATON program, the assessment determined that the program did not demonstrate results and recommended that the program have specific long-term performance goals that focus on outcomes. The assessment of the domestic icebreaking program determined that the program was effective, but that more ambitious performance targets needed to be set. In response to these findings, the Coast Guard has worked to set long-term performance targets and develop new measurement frameworks to align with OMB’s recommendations.

To Continue to Achieve the Missions of Its ATON and Domestic Icebreaking Assets, the Coast Guard Has Taken Actions, Made Proposals, and Studied Outsourcing Possibilities

The Coast Guard has considered or proposed a wide variety of actions to continue to achieve the missions that its domestic icebreaking and ATON assets perform and is moving ahead with several of them. Actions under way include developing new ways to measure asset condition, manage boat and cutter maintenance, and make choices about which maintenance projects to conduct. The Coast Guard has also acquired some new buoy tenders and a new icebreaker, though the bulk of its icebreaking and ATON fleet remains at or beyond projected service lives. Coast Guard officials stated that to determine whether and when to replace or rehabilitate aging assets, factors such as the assets’ condition and trends in maintenance costs, among other things, are taken into account. Proposals to systematically rehabilitate or replace these assets have been denied or deferred by DHS or the Office of Management and Budget (OMB), apparently due to competition from initiatives such as the $24-billion Deepwater project for replacing or renovating other Coast Guard vessels and aircraft. In response, the Coast Guard has separated the proposals into smaller parts and is trying to fund some projects from within the Coast Guard’s budget. Finally, the Coast Guard studied what mission activities make the best business case for outsourcing of functions to the private sector, but states that potential disadvantages to outsourcing exist such as loss of capabilities and inability to retain personnel.

Actions Have Been Taken to Manage Assets and Acquire Some New Ones

Three main steps to manage assets are under way, and several acquisitions have been completed in both the icebreaking and ATON fleets.

Coast Guard Is Developing a More Robust Condition Measure

The Coast Guard is working on the development of a new measure to track an asset’s condition. As mentioned above, the Coast Guard’s previous measure, percent of time free of major casualties, did not capture the extent to which equipment casualties degraded mission capabilities. Called “percent of time fully mission capable,” this new measure is intended to more directly link a cutter’s condition to its mission capability. Developed after our examination of the condition of deepwater assets, this measure will be used for ATON and domestic icebreaking assets as well. For the new measure, the Coast Guard is developing codes that rank the degree of importance of each piece of a cutter’s equipment to each mission that the cutter could perform. The Coast Guard plans to use these codes in casualty reports, providing engineers and operators with information about the impact of equipment casualties on each possible mission. This information will then be used in calculating the condition measure for each cutter class and mission. This information would allow Coast Guard officials to determine, for example, the degree of icebreaking capability of its domestic icebreaking fleet at any given time. Coast Guard officials said they expect final approval of this measure this year.

Coast Guard Is Implementing New Approaches to Manage ATON Boat and Cutter Maintenance

The Coast Guard is implementing a centralized boat maintenance initiative to improve the management of its boat fleet, which includes many ATON boats. In contrast to the previous approach in which local boat operators managed boat maintenance and oversaw the spending of maintenance funds, the new initiative places management of boat maintenance and expenditures with naval engineers. According to the Coast Guard, the key advantages of this initiative include standardized maintenance practices for the boats, better oversight of maintenance funding, and enhanced tracking and analysis of casualties. In addition, it should improve the tracking of the condition of the Coast Guard’s small boat fleet, which has lacked a centralized tracking system. Known as Centralized Boat Maintenance Management, this initiative is expected to be rolled out Coast Guard-wide by fiscal year 2008 if adequate resources and personnel are available.

Since 2002, the Coast Guard has also been gradually implementing a maintenance approach called “condition based maintenance” for select subsystems and parts of its newer coastal and seagoing buoy tending cutters. Under this approach, the condition of a part or subsystem, such as the main diesel engine, is evaluated or assessed at regular intervals to determine whether it needs to be replaced or have maintenance performed. Parts or systems would be replaced or receive maintenance only if their condition showed excessive wear or did not perform at an acceptable level. Under the previous approach, maintenance occurred at time-based intervals even if the part showed no excessive wear or performed acceptably. The key advantage of the change, according to Coast Guard officials, is reduced costs. For example, the Coast Guard estimated that it reduced drydock costs related to maintaining newer coastal and seagoing buoy tenders $2 million in fiscal year 2005. The Coast Guard is considering expanding the use of this maintenance approach to other subsystems of the newer buoy tending assets and the new Great Lakes icebreaker commissioned in 2006.

Coast Guard Is Developing a Tool to Better Prioritize Upgrades and Maximize Asset Capabilities

In 2002, we recommended that the Coast Guard develop a long-term strategy to set and assess levels of mission performance. We found this was an important step to take because it links investments to asset capabilities and mission priorities so that the Coast Guard can better decide how limited budget dollars should be spent. The Coast Guard has been working to apply the principles behind such a strategy to (1) better prioritize the projects needed to upgrade assets such as aging ATON and domestic icebreakers and (2) obtain the greatest overall mix of capabilities for its assets within its budget in order to maximize mission performance. The tool it is developing is called the Capital Asset Management Strategy (CAMS).

CAMS is designed to analyze the capability trade-offs for upgrades and maintenance projects across asset classes, allowing the Coast Guard to determine which combination of projects will provide the most capability for the dollars invested. These analyses take into account such factors as asset condition, the asset’s importance to specific missions, and the relative importance of missions. The Coast Guard continues to refine CAMS and expects to have it in full use beginning with the budget for fiscal year 2009. The recommendations stemming from CAMS are intended to augment the information currently provided to decision makers in the budget development process.

Coast Guard Acquired Some New Assets

Since the 1990s, the Coast Guard has been able to replace buoy tenders with new assets that represent about 15 percent of its current ATON fleet. From 1996 to 2004, the Coast Guard commissioned 14 new 175-foot coastal buoy tenders and 16 new 225-foot seagoing buoy tenders to replace an aging fleet of 11 coastal and 27 seagoing buoy tenders that were built between 1942 and 1971. The new buoy tenders have improved capabilities such as the following: A computerized positioning system that automates the task of holding the vessel in place while working on a navigational aid. Previously, this task had to be done manually, requiring the crew to constantly monitor and maintain the vessel’s position, sometimes for up to 10 hours at a time. The system relieves the crew of this task and reduces safety concerns associated with crew fatigue.

Bow and stern thrusters to enhance the vessels’ maneuverability and improve the crew’s ability to maintain position.

Hydraulic chain stoppers and winches to reduce the number of crew members required to do the work and enhance safety (see fig. 8).

Accommodations that allow for dual gender crews, increasing the Coast Guard’s ability to allow women to serve on the vessels.

These and other features also allow the newer buoy tenders to carry out other missions, according to a Coast Guard official involved in their design and acquisition. Their size, stability, and maneuverability are useful for such missions as search and rescue, homeland security, and law enforcement, and they have specific capabilities for dealing with other duties as skimming oil or mounting machine guns for security patrols.

With their sizeable fuel tanks and storage capacity, they can also serve as logistics support platforms to restock vessels involved in drug interdiction and other activities. For 7 weeks in 2005, for example, one tender served as a supply platform for a Coast Guard vessel conducting drug interdiction patrols. According to Coast Guard officials, this enabled the patrol vessel to remain on patrol in the area for a longer period of time than it would have otherwise with its limited fuel and storage capacities.

Besides the buoy tenders, the Coast Guard commissioned a new 240-foot multimission icebreaker in 2006 to replace a 62-year-old icebreaker and an aging buoy tender on the Great Lakes. The new icebreaker has enhanced icebreaking capabilities and the same ATON capabilities as the newer seagoing buoy tenders, enabling it to work on navigational aids in ice conditions as well as during other times of the year when no icebreaking is needed.

Additional Proposals to Rehabilitate or Replace Aging Assets Remain Largely Unfunded

Despite the new acquisitions, more than half of the assets in the domestic icebreaking and ATON fleet have reached or are nearing the end of their service lives. Coast Guard officials stated that they use a process that considers information such as how close the assets are to the end of their design life, the condition of the assets as determined by periodic assessments, and trends in maintenance costs, among other things to determine whether to rehabilitate or replace these aging assets. This information is used to identify the asset types that are most in need of replacement or major maintenance, and therefore should be given greater consideration in maintenance planning and budgeting.

In 2002, the Coast Guard proposed options for systematically rehabilitating or replacing 164 cutters and boats in these fleets. According to Coast Guard officials, these options were proposed after determining that the age, condition, and cost of operating these assets would diminish the capability of the Coast Guard to carry out ATON and domestic icebreaking missions over time without rehabilitation or replacement of some or all of the assets. In 2004, it completed a preliminary analysis of four approaches, including the status quo—that is, maintaining the existing fleet. This analysis provided an estimate of the total life-cycle costs for each approach over a 33-year period from fiscal year 2005 to fiscal year 2037. (See table 7 for a description of each approach.) Estimated costs ranged as high as $8.5 billion; however, Coast Guard officials emphasized that these estimates were preliminary and are not reliable. As a result, we are not reporting these numbers in detail.

No funds have been allocated to pursue this project further, apparently due to competing funding requests for replacing or rehabilitating other Coast Guard assets. According to a Coast Guard program official, although resource proposals to carry out this project were made during the budget planning processes for fiscal years 2004 through 2007, the requests were either deferred or denied by DHS or the Office of Management and Budget. Coast Guard officials involved in the program said they were not aware of the exact reasons why the requests were terminated or deferred. The officials said that the funding demands from other major Coast Guard programs already underway (such as the Deepwater program for replacing or rehabilitating aircraft and cutters with greater at-sea capability) that likely had higher priority in the competition for limited resources combined with the large scope and size of the proposed project, may have prevented the project from being funded.

Without specific funding to move the project forward, the Coast Guard has attempted to break the project into smaller components and pursue potential funding from within the Coast Guard’s budget, focusing on the assets most in need of maintenance or replacement. In February 2006, the Coast Guard began a project to replace its fleet of 80 trailerable aids-to- navigation boats with new boats that have enhanced capabilities to do ATON work as well as other missions. The enhanced capabilities include equipment to lift navigational aids out of the water for service, more deck space for working on these aids, an elevated work platform for working on aids that are high in the water, and faster speeds to reduce transit times. The Coast Guard intends for the new boats to be more multimission capable. For example, their added speed and deck space will help with search and rescue missions, and they will have gun mounts for use in law enforcement or maritime security missions.

According to a Coast Guard official, this acquisition would cost approximately $14.4 million if all 80 boats are purchased and would bring on new boats over a 5-year period as funds allow. The Coast Guard official responsible for the project said the Coast Guard intends to make the purchases using a funding stream appropriated for the maintenance of nonstandard boats that can be allocated to the boats with the most pressing maintenance or recapitalization needs. Availability of these funds, however, depends on the condition and maintenance needs of other nonstandard boats; if this funding has to be applied to meet other needs, such as unanticipated problems, it may not be available for purchasing these boats.

Separate from this effort to acquire new trailerable boats, the Coast Guard has made a request as part of the budget process to begin rehabilitating aging river buoy and construction tenders. This project, which will focus on rehabilitating the systems within the engine rooms of the assets, is estimated to cost approximately $75 million. The Coast Guard plans to include this project in future budget requests. Coast Guard officials indicated that they were submitting this request because these assets were determined to be in the worst condition.

Study Identified Outsourcing Possibilities but May Face Disadvantages to Implement

In 2004, the Coast Guard examined possibilities for outsourcing missions in response to an OMB assessment of the ATON program. As a result of that assessment, Coast Guard and OMB officials agreed to study which ATON activities make the best business case for being performed by contractors outside of the Coast Guard with minimal impact on the Coast Guard’s ability to carry out its other missions. The subsequent study, completed in April 2004, found that inland construction tenders spent most of their resource hours on the ATON mission with minimal impact or use in other missions and provided one of the best opportunities for further study of outsourcing. However, the study did not quantify the potential benefits that could be derived from outsourcing these activities.

In August 2006 the Coast Guard completed an analysis as to whether ATON functions could feasibly be outsourced, and which parts, if any, were inherently governmental in nature. The objective of this analysis was to compare the Coast Guard's inland construction and river buoy tender operating costs with representative private sector marine industry costs and make recommendations regarding the feasibility to commercially support and operate the inspection, servicing, and contingency response capability of the ATON mission and assets.

According to Coast Guard officials, the results will be incorporated into future acquisition plans for replacing the current capabilities represented by inland construction tenders and river buoy tenders. This Coast Guard analysis was finalized after we had completed our audit work. Therefore, we were unable to obtain and review the study in time for the final preparation of this report.

Although possibilities for outsourcing were identified, outsourcing also carries potential disadvantages, according to Coast Guard program officials. Potential disadvantages they mentioned include the following: Outsourcing could lead loss of “surge” capability—that is, the capacity to respond to emergencies or unusual situations. In part, this capability may be needed within the ATON or icebreaking mission itself, such as when a hurricane or ice destroys or damages a large number of navigation aids. In the case of Hurricane Katrina, Coast Guard officials stated that because the Coast Guard had ATON assets such as construction tenders, crews were able to begin working immediately to repair damaged aids and get the waterways open to maritime traffic again. This “surge” capability may also be needed for other missions, such as occurs when ATON assets can be used to support search and rescue efforts. In the aftermath of Hurricane Katrina, for example, some ATON assets provided logistical support for first responders or transported stranded individuals.

Outsourcing may disrupt the Coast Guard’s personnel structure and weaken the agency’s ability to attract and retain personnel. Specifically, they are concerned that outsourcing would likely reduce opportunities that provide important experience for personnel to advance in their careers and eliminate positions that typically have more predictable work schedules than positions in some of the other Coast Guard’s missions.

Concluding Observations

The Coast Guard has been using its domestic icebreaking vessels and its ATON assets to a lesser extent, to accommodate the need for additional homeland security activities in the post-September 11 environment, and it is doing so thus far largely without curtailing ATON or domestic icebreaking activities or unduly straining these assets past their designed workloads. The available evidence also indicates that despite some decline in the condition of some asset types, the Coast Guard’s ability to meet its aids-to-navigation and domestic icebreaking missions, as indicated by mixed outcomes of its key mission performance measures, has not shown clear trends of decline. Efforts by Coast Guard personnel to troubleshoot operational problems and to take other steps to keep assets operating appear to be one reason mission performance has not been further affected, and many other factors, such as the harshness of a winter or the severity of storm damage on navigation buoys and beacons, can also affect performance results. For the present, however, the impact of these additional mission responsibilities does not appear to be a cause for alarm.

That said, the future of these assets bears close watching. The fact that many of the assets have or will be approaching the end of their design service lives could mean the need for rehabilitated or new assets may become more pressing in the future. Another issue is whether current operations, both in level and types of usage, are adding to these costs and incidents beyond what the Coast Guard would normally expect. For example, operating domestic icebreakers beyond their underway hours limit—could potentially accelerate the level of decline. If this is the case, using these assets to meet security missions could be meeting the Coast Guard’s immediate needs but accelerating the need for replacement or rehabilitation. According to Coast Guard officials, the Coast Guard’s attempt to systematically rehabilitate or replace its ATON and domestic icebreaking fleet was proposed at a time when competing demands likely caused postponements of requests for the needed funds. These competing demands, reflected largely in the Coast Guard’s expensive and lengthy Deepwater asset replacement program, will continue for some time, as will other pressures on the federal budget. The Coast Guard is moving to improve the process it uses to set budget priorities through actions such as its new tool to link asset condition and funding decisions to better identify the projects that will provide the most capability with the limited funds that are available. Given that many of these actions are recent and need a chance to work, it is too early to evaluate their effectiveness. However, even as the Coast Guard takes steps to determine how best to replace or rehabilitate its assets, limited budgetary resources combined with other competing asset replacement programs already in process will likely continue to challenge the Coast Guard to find sufficient resources to carry out the options identified.

Agency Comments

We requested comments on a draft of this report from the Department of Homeland Security and the Coast Guard. The Coast Guard provided technical comments, which we have incorporated into the report as appropriate.

As agreed with your office, unless you publicly announce the contents of this report earlier, we plan no further distribution of it until 30 days from the date of this letter. We will then send copies of this report to the appropriate congressional committees; the Secretary of Homeland Security; the Commandant of the Coast Guard; and other interested parties. In addition, this report will be available at no charge on the GAO Web site at http://www.gao.gov.

If you or your staff have any questions about this report, please contact me at (202) 512-9610 or CaldwellS@gao.gov. Contact points for our Offices of Congressional Relations and Public Affairs may be found on the last page of this report. GAO staff who made major contributions to this report are listed in appendix V.

Appendix I: Objectives, Scope, and Methodology

This report examines the time spent by the U.S. Coast Guard’s domestic icebreaking and ATON assets on various missions, the condition of these assets, and the actions the Coast Guard has taken to continue to achieve the missions of these assets. Our work focused on three key questions: (1) What are the recent trends in the amount of time these assets have performed various missions? (2) What is the condition of the Coast Guard’s ATON and domestic icebreaking assets and how has their condition impacted the performance of their primary missions? (3) What actions has the Coast Guard taken to continue to achieve the missions of its ATON and domestic icebreaking assets?

In identifying trends in the amount of time spent on missions and the impact of these trends, we analyzed data from the Coast Guard’s Abstract of Operations (AOPS) database, which tracks resource hours for each asset. For each asset type within our scope, we examined trends in the number of resource hours spent between fiscal years 2001 and 2005 conducting each of the Coast Guard’s missions. To determine the reliability of this data, we (1) reviewed the results of previous reliability assessments we have conducted of this data for other work and (2) confirmed with the AOPS program manager that the data and the manner in which it is managed has not changed since the previous assessment that would affect its reliability. We determined that the data was sufficiently reliable for the purposes of this report. We supplemented our analysis of these resource hours with documentation from interviews with asset program managers and crews of ATON and domestic icebreaking assets.

In assessing the condition of the assets during fiscal years 2001 to 2005, we analyzed what Coast Guard officials identified as the best available condition measures. We obtained concurrence from the Office of Naval Engineering and the Office of Cutter Forces that the appropriate measures to use for the condition of assets were percent of time free of major casualties, scheduled/unscheduled/Engineering Logistics Center maintenance costs, and estimated deferred maintenance costs. To determine the reliability of this data, we (1) reviewed the results of previous reliability assessments we have conducted of this data for other work and (2) examined responses the Coast Guard provided to a questionnaire we sent requesting updated information on the administration and oversight of the databases. We determined that the data was sufficiently reliable for the purposes of this report. We supplemented our analysis of these measures with documentation from internal Coast Guard reports, as well as from interviews of asset program managers at Coast Guard headquarters and crewmembers of the assets located in the field. In addition to talking with crewmembers, we directly observed the condition of various assets during our site visits to Alameda, Calif; Bayonne, N.J.; Buchanan, Tenn; Baltimore, Md; Mobile, Ala; Seattle, Wash; Sault St. Marie, Mich; and Atlantic Beach, N.C. These assets were selected to provide diversity in terms of type and age of asset and geographic location. In addition, we interviewed Coast Guard officials with the Area Commands in Alameda, Calif., and Portsmouth, Va., as well as in Districts 5 and 13.

To determine the actions that the Coast Guard has undertaken to continue to achieve the missions of its ATON and domestic icebreaking assets, we interviewed officials with the Coast Guard’s Engineering and Logistics Center, Engineering and Logistics Directorate, Office of Naval Engineering, Office of Boat Forces, and Office of Cutter Forces. To obtain information on newer assets the Coast Guard has acquired, we also made site visits to interview personnel and observe the assets in San Francisco, Calif.; Atlantic Beach, N.C.; Baltimore, Md.; Cheboygan, Mich.; and Mobile, Ala. To determine what proposals the Coast Guard has made to rehabilitate or replace its ATON and domestic icebreaking assets, we reviewed Coast Guard project documents and interviewed officials at Coast Guard headquarters. We did not, however, verify the accuracy of the cost estimates provided for those proposals. Finally, to determine the work the Coast Guard has done to study the outsourcing of ATON and domestic icebreaking mission activities and the potential impact of outsourcing those activities, we interviewed Coast Guard officials at headquarters as well as officials and crew members in the field. We also reviewed the completed business case analysis of outsourcing opportunities for ATON mission activities.

We performed our review from July 2005 to August 2006 in accordance with generally accepted government auditing standards.

Appendix II: Mission Resource Hours of ATON and Domestic Icebreaking Assets, Fiscal Years 2001 to 2005

Appendix II provides information on the number of resource hours Coast Guard ATON and domestic icebreaking assets have spent on various Coast Guard missions during fiscal years 2001 through 2005. The Coast Guard maintains information, on a program-by-program basis, about how resources, such as vessels, boats, and aircraft, are used. Each hour that these resources are used is called a resource hour. Resource hours are accumulated and reported by quarter and represent the time spent by the Coast Guard’s major assets to conduct its programs. The table 8 shows by asset type, the hours ATON and domestic icebreaking assets have spent on each of Coast Guard’s missions for each fiscal year, from 2001 through 2005. The percentage of each asset types’ total fiscal year resource hours that these hours represent is shown in parenthesis.

Appendix III: Condition Measure of ATON and Domestic Icebreaking Assets, Fiscal Years 2000 to 2005

Condition Measure for ATON and Domestic Icebreaking Cutters

Appendix III provides information on the condition of the Coast Guard’s ATON and domestic icebreaking assets. The Coast Guard’s key summary measure of condition—percent of time free (POTF)—of major casualties shows a mixed picture of condition for ATON and domestic icebreaking cutters. However, the measure captures only major equipment casualties, which degrade mission capabilities but does not capture minor equipment casualties that may also degrade mission capabilities. As such, this measure may underestimate the decline in asset condition. The Coast Guard has acknowledged the limitations of this measure and is working on a replacement for it. Because the Coast Guard is in the process of developing a new condition metric and did not have fiscal year 2005 data available, our analysis covers fiscal years 2000 through 2004. See table 9 for individual POTF figures for the ATON and domestic icebreaking cutter assets for fiscal years 2000 through 2004.

Condition Measure for ATON Boats

The Coast Guard has less data for ATON boats, with POTF figures available for only fiscal year 2005. Based on these figures most boats appear to be in fair to poor condition. In addition to these figures, the Coast Guard has performed an internal assessment of condition using two approaches, one for standard and another for nonstandard boats. For standard boats the Coast Guard assessed condition through a process referred to as ship structure and machinery evaluation boards (SSMEB). While, for nonstandard boats the Coast Guard assessed condition by obtaining anecdotal evidence from district managers, maintenance managers, annual boat inspection reports, and site visits. This internal assessment, however, seems to further support our original finding that the Coast Guard’s POTF figure may be underestimating condition. As you will see in table 10 below, while the 45-foot buoy boat and 21-foot trailerable aids-to-navigation boat had POTF percentages above 90 percent, their internal assessment of condition was rated at poor.

Appendix IV: Maintenance Trends of ATON Cutter and Domestic Icebreaking Assets, Fiscal Years 2001 to 2005

Maintenance Trends

Appendix IV provides information on the maintenance costs spent on the Coast Guard’s ATON cutter and domestic icebreaking assets during fiscal years 2001 to 2005. Maintenance cost data for domestic icebreakers and ATON cutters shows a consistent increasing trend. The cost figures are broken out by scheduled (planned maintenance), unscheduled (unforeseen maintenance), and Engineering Logistic Center (ELC) (fleetwide projects that require engineering assistance) amounts, which allow for a more specific analysis as to the type of increase being incurred. Table 11 shows the individual maintenance cost data, adjusted for inflation using 2005 dollars, for ATON cutters and domestic icebreakers for fiscal years 2001 through 2005.

Appendix V: GAO Contact and Staff Acknowledgments

Stephen L. Caldwell, Acting Director, Homeland Security and Justice Issues, (202) 512-9610, or CaldwellS@gao.gov.

Acknowledgments

In addition to the above, individuals making key contributions to this report include Chuck Bausell, Melanie Brown, Steve Calvo, Michele Fejfar, Geoffrey Hamilton, Christopher Hatscher, Stephanie Sand, Stan Stenersen, Gladys Toro, and Friendly Vang-Johnson.

Related GAO Products

Coast Guard: Non-Homeland Security Performance Measures Are Generally Sound, but Opportunities for Improvement Exist. GAO-06-816. Washington, D.C.: August 16, 2006.

Coast Guard: Observations on the Preparation, Response, and Recovery Missions Related to Hurricane Katrina. GAO-06-903. Washington, D.C.: July 31, 2006.

Coast Guard: Observations on Agency Performance, Operations, and Future Challenges. GAO-06-448T. Washington, D.C.: June 15, 2006.

Maritime Security: Enhancements Made, but Implementation and Sustainability Remain Key Challenges. GAO-05-448T. Washington, D.C.: May 17, 2005.

Maritime Security: New Structures Have Improved Information Sharing, but Security Clearance Processing Requires Further Attention. GAO-05-394. Washington, D.C.: April 15, 2005.

Coast Guard: Observations on Agency Priorities in Fiscal Year 2006 Budget Request. GAO-05-364T. Washington, D.C.: March 17, 2005.

Coast Guard: Station Readiness Improving, but Resource Challenges and Management Concerns Remain. GAO-05-161. Washington, D.C.: January 31, 2005.

Homeland Security: Process for Reporting Lessons Learned from Seaport Exercises Needs Further Attention. GAO-05-170. Washington, D.C.: January 14, 2005.

Port Security: Better Planning Needed to Develop and Operate Maritime Worker Identification Card Program. GAO-05-106. Washington, D.C.: December 10, 2004.

Maritime Security: Better Planning Needed to Help Ensure an Effective Port Security Assessment Program. GAO-04-1062. Washington, D.C.: September 30, 2004.

Maritime Security: Partnering Could Reduce Federal Costs and Facilitate Implementation of Automatic Vessel Identification System. GAO-04-868. Washington, D.C.: July 23, 2004.

Maritime Security: Substantial Work Remains to Translate New Planning Requirements into Effective Port Security. GAO-04-838. Washington, D.C.: June 30, 2004.

Coast Guard: Key Management and Budget Challenges for Fiscal Year 2005 and Beyond. GAO-04-636T. Washington, D.C.: April 7, 2004.

Homeland Security: Summary of Challenges Faced in Targeting Oceangoing Cargo Containers for Inspection. GAO-04-557T. Washington, D.C.: March 31, 2004.

Homeland Security: Preliminary Observations on Efforts to Target Security Inspections of Cargo Containers. GAO-04-325T. Washington, D.C.: December 16, 2003.

Posthearing Questions Related to Aviation and Port Security. GAO-04-315R. Washington, D.C.: December 12, 2003.

Maritime Security: Progress Made in Implementing Maritime Transportation Security Act, but Concerns Remain. GAO-03-1155T. Washington, D.C.: September 9, 2003.

Homeland Security: Efforts to Improve Information Sharing Need to Be Strengthened. GAO-03-760. Washington D.C.: August 27, 2003.

Container Security: Expansion of Key Customs Programs Will Require Greater Attention to Critical Success Factors. GAO-03-770. Washington, D.C.: July 25, 2003.

Homeland Security: Challenges Facing the Department of Homeland Security in Balancing Its Border Security and Trade Facilitation Missions. GAO-03-902T. Washington, D.C.: June 16, 2003.

Transportation Security: Post-September 11th Initiatives and Long- Term Challenges. GAO-03-616T. Washington, D.C.: April 1, 2003.

Port Security: Nation Faces Formidable Challenges in Making New Initiatives Successful. GAO-02-993T. Washington, D.C.: August 5, 2002.

Combating Terrorism: Preliminary Observations on Weaknesses in Force Protection for DOD Deployments through Domestic Seaports. GAO-02-955TNI. Washington, D.C.: July 23, 2002.

Coat Guard: Non-Homeland Security Performance Measures Are Generally Sound, but Opportunities for Improvement Exist. GAO-06-816, Washington, D.C.: August 16, 2006.