The Coast Guard is responsible for 11 statutory missions that are divided into non-homeland security and homeland security missions, as shown in table 1. The Homeland Security Act of 2002 requires that the authorities, functions, and capabilities of the Coast Guard to perform all of its missions be maintained intact and without significant reduction, except as specified in subsequent acts. It also prohibits the Secretary of Homeland Security from reducing “substantially or significantly…the missions of the Coast Guard or the Coast Guard’s capability to perform those missions.” The Coast Guard utilizes aircraft and vessels to conduct its 11 missions. The Coast Guard operates two types of aircraft—fixed-wing (airplanes) and rotary-wing (helicopters), including its new C-27J aircraft–and two types of vessels–cutters and boats. A cutter is any vessel 65 feet in length or greater, having adequate accommodations for crew to live on board. Larger cutters (major cutters), over 179 feet in length, include the National Security Cutter and the High and Medium Endurance Cutters. Cutters from 65 to 175 feet in length include Patrol Cutters such as the Fast Response Cutter and the 110-foot Patrol Boat, among others. In contrast, all vessels less than 65 feet in length are classified as boats and usually operate closer to shore and on inland waterways. As of the end of fiscal year 2015, Coast Guard assets included 61 fixed-wing aircraft, 142 rotary-wing aircraft, 40 major cutters, 205 cutters, and 1,750 boats. Figure 1 shows three of the Coast Guard’s newest assets. The Coast Guard began a 30-year recapitalization effort in the late 1990s to modernize its aircraft and vessel fleets by rebuilding or replacing assets. Figure 2 provides a timeline of key events and related acquisition studies and reports in this recapitalization program, which was formerly known as the Deepwater Program. As part of its recapitalization effort, in 1998, the Coast Guard created the Deepwater Program baseline to reflect asset performance levels at that time and to serve as a basis for developing performance goals for the acquisition of new assets that were to replace certain legacy assets. However, a performance gap analysis conducted in 2002 determined the revised asset mix, as designed by the recapitalization program, would have significant capability gaps in meeting emerging mission requirements following the September 11, 2001, terrorist attacks. As a result, the Coast Guard completed a Mission Needs Statement in 2005 to incorporate the additional capabilities and subsequently updated the annual resource hours needed to meet its increased mission demands. In 2007, based on the 2005 Mission Needs Statement, DHS approved a program of record for all of the Coast Guard’s major acquisition programs at an estimated cost of $24.2 billion. This program of record delineated the specific number of aircraft and vessels the Coast Guard planned to acquire to meet the annual resource hours outlined by the 2005 Mission Needs Statement baseline. Further, as part of its recapitalization efforts, the Coast Guard submits an annual 5-year Capital Investment Plan Report to Congress that includes, among other things, projected funding for capital assets in such areas as acquisition, construction, and improvements. In 2016, the Coast Guard again revised its Mission Needs Statement in response to statutory requirements and committee report language, but, this revision states it was not intended to provide details on the specific assets the Coast Guard needs to meet its mission requirements. Further, according to the Coast Guard, the 2016 update to the Mission Needs Statement is to provide a foundation for long-term investment planning that is to culminate with detailed modeling scenarios to evaluate the effectiveness of various fleet mixes, and inform the Coast Guard’s Capital Investment Plan. Since the 2016 revision does not identify specific assets or resource hours necessary to meet the Coast Guard’s mission requirements, the 2005 Mission Needs Statement remains the baseline document outlining the Coast Guard’s mission needs and the resource hours per asset necessary to achieve them. Since fiscal year 2008, the Coast Guard has used the Standard Operational Planning Process for annually developing and communicating strategic commitments and allocating resource hours, by asset type (i.e., aircraft, cutters, and boats), throughout its chain of command for meeting mission responsibilities. As part of the Standard Operational Planning Process, Coast Guard headquarters annually issues a Strategic Planning Direction, which is to be the primary mechanism for allocating asset resource hours and providing strategic direction to field commands. Resource hours are subsequently allocated by asset type at the Area, District, and Sector levels for meeting strategic commitments and executing the 11 statutory missions. After assets are deployed, field unit personnel are to record resource hours used by Coast Guard assets to accomplish missions, such as domestic ice breaking or marine environmental protection operations. These asset resource hours are input into one of two operational reporting databases–the Asset Logistics Maintenance Information System (ALMIS) or the Abstract of Operations System (AOPS). After the data have been entered, the Coast Guard Business Intelligence system is used to extract and combine asset resource hour and performance data each quarter to create Operational Performance Assessment Reports. The historical and current-year data on asset operational hours used, by mission, from these reports, as well as Planning Assessments, are to be communicated back to Coast Guard headquarters and incorporated into the Standard Operational Planning Process to inform asset hour allocations in the Strategic Planning Direction for the following year. Since the Coast Guard developed acquisition plans for its Deepwater recapitalization program, many of the assumptions that initially informed these plans, including the 2005 Mission Needs Statement baseline for those assets, have changed and are no longer accurate, as we reported in June 2014 and May 2015. While the Coast Guard is continuing to acquire and deploy new assets each year, the Coast Guard operated assets in fiscal year 2015 below the baseline level of resource hours outlined for these assets in the 2005 Mission Needs Statement. For example, in fiscal year 2015, a mix of new and legacy Patrol Cutters, including new Fast Response Cutters, used 82,233 resource hours of the 174,000 resource hours specified in the 2005 baseline—a 52 percent difference. The asset resource hours used in fiscal year 2015 were below the 2005 baseline level, in part, because not all of the new assets planned as part of the 2005 baseline were deployed and fully operational by fiscal year 2015. In addition, as we have previously reported, the Coast Guard continues to operate many of its legacy assets, which do not always achieve their expected operational capacities. Specifically, some legacy cutters are up to 50 years old and are expected to be in operation for several more years until the replacement cutters can be deployed. We have also reported that the Coast Guard has experienced delays in acquiring some of its planned assets and some of the Coast Guard’s new assets that have been deployed have faced operational challenges. Nevertheless, because of changes in the assumptions underlying the 2005 Mission Needs Statement baseline, it may not accurately reflect the Coast Guard’s current needs, specifically (1) the planned fleet mix of aircraft and vessels has changed, and (2) the planned operational capacities of these new assets have, in some cases, been revised downward. See Appendix I for more information on the Coast Guard asset baselines and actual resource hours used in fiscal year 2015, as well as changes to its planned fleet mix and operational capacities over time. The Coast Guard’s planned aircraft and vessel fleet mix has changed since the 2005 Mission Needs Statement baseline was developed. For example, in 2005, the Coast Guard planned for the acquisition of HC-144 and HC-130 aircraft for its fixed-wing aircraft fleet. However, we reported in March 2015 that the unexpected transfer of C-27J aircraft from the Department of Defense in December 2013 represented a significant change to this aircraft fleet mix. As a result of this change, the Coast Guard decreased its planned acquisition of HC-144 aircraft. In another example, with regard to its aircraft fleet, the Coast Guard initially planned for fixed-wing Unmanned Aerial Vehicles and Vertical Take-Off and Landing Unmanned Air Vehicles in the 2005 baseline, but, as of May 2016, Coast Guard officials stated these unmanned assets have not yet been acquired. For the major cutter fleet, the Coast Guard had planned for 8 National Security Cutters and 25 Offshore Patrol Cutters to replace the legacy fleet of High and Medium Endurance Cutters in its 2005 Mission Needs Statement baseline. However, Congress recently provided the Coast Guard with funding for a ninth National Security Cutter as part of the Consolidated Appropriations Act, 2016, representing an unanticipated addition to its planned major cutter fleet. The expected operational capacities planned for assets in the 2005 Mission Needs Statement baseline have, in several cases, been subsequently revised downward to reflect more realistic and achievable operational targets. For example, regarding fixed-wing aircraft, the Coast Guard originally planned for each HC-144 aircraft to operate 1,200 flight hours per year. However, we reported in March 2015 that the Coast Guard had decided to reduce the HC-144 flight hours from 1,200 hours to 1,000 hours per year due primarily to the high cost of maintaining the aircraft at the 1,200-hour per year pace. For patrol cutters, the 2005 Mission Needs Statement baseline planned for each Fast Response Cutter to operate for 3,000 hours per year. However, the Coast Guard’s April 2016 report to Congress on its capital investments states that the planned resource hours for each Fast Response Cutter is 2,500 hours per year—a reduction of 500 hours per cutter from the 2005 baseline. Further, for major cutters, the Coast Guard’s 2005 baseline planned for each National Security Cutter and Offshore Patrol Cutter to operate at 4,140 resource hours per year—equivalent to 230 days away from home port—using a crew rotation concept. However, in March 2015, we reported that because of certain risk factors, uncertainty exists regarding the Coast Guard’s ability to achieve this operational capacity.