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Washington - Eight leaky patrol boats are at the heart of a bitter dispute between the Coast Guard and its former partners in the defense industry as the nation's smallest military service struggles to update an antiquated fleet on a tight budget.
In April, Adm. Thad Allen, Coast Guard commandant, announced at a press briefing that the service would decommission the eight patrol boats, worth around $100 million combined, just months after the first emerged from extensive work at a Northrop Grumman shipyard that included lengthening the hull by 13 feet. The lead vessel's hull buckled on its maiden voyage, betraying serious flaws in Northrop Grumman's hull work. The boat's propeller shaft was also found to be misaligned. Allen said the government would consider suing Northrop Grumman and its partner, Lockheed Martin, for an undisclosed sum.
The boats were the first of several major initiatives to emerge from the 25-year, $24-billion "Deepwater" scheme. Deepwater was supposed to replace all of the Coast Guard's approximately 30 large ships while also replacing or upgrading all of its hundreds of boats, airplanes and helicopters, all under a relatively low cost ceiling. Many Coast Guard vessels were built in the 1960s and cannot safely serve much longer.
Additionally under the contract, shore stations would get an electronics upgrade and all the Guard's major assets ashore, afloat and aloft would be tied together with a new digital communications network that would, in theory, facilitate delicate coordination over long distances and speed up authorizations for arrests and the use of lethal force. No other military service had ever attempted a top-to-bottom overhaul on the cheap like this, and the Coast Guard knew it didn't have the expertise to pull it off.
So it contracted it out, to a surprising alliance of two of the country's biggest defense contractors. Lockheed Martin, specializing in electronics and aircraft, partnered with shipbuilder Northrop Grumman to form "Integrated Coast Guard Systems," or ICGS. The partnership represented one of the largest applications of the "Lead Systems Integrator" concept, wherein government pays industry to manage large contracts on its behalf. In other words, the Coast Guard authorized ICGS to pick the firms that would build the service's new ships, airplanes and computers.
Unsurprisingly, ICGS picked Lockheed Martin and Northrop Grumman - in other words, itself - to do most of the work. The result, according to critics, was poor oversight that resulted in shoddy work. Of the roughly half-dozen major projects early in the Deepwater schedule, at least two suffered major problems, including the stretched patrol boats. The Coast Guard also discovered that large cutters slated to begin entering service in late 2007 suffered design flaws that would prematurely age them. The cutters' flaws required fixes costing millions of dollars.
While structural problems grabbed the limelight, a former Lockheed Martin employee who had worked on the leaky patrol boats alleged that the boats also had electronics flaws that might have spread to other Deepwater programs, as well. Michael DeKort highlighted network security holes, poor wiring and other problems with the patrol boats that he said were the result of corner-cutting and poor leadership at Lockheed Martin. DeKort's whistle-blowing sparked intensive media coverage, damning audits and a Congressional hearing, but neither ICGS nor the Coast Guard ever publicly confirmed the alleged electronics flaws.
In August, Lockheed Martin spokesman Troy Scully said that legal issues related to the faulty patrol boats were "pretty much put to bed," while conceding that the Department of Justice was still investigating. But leaked documents reveal that, as of the middle of June, the battle over the boats was only escalating and in fact threatened to break out on an entirely new front.
On May 17, Coast Guard contracting officer Pamela Bible wrote to ICGS recalling the boats' problems and informing ICGS that the service had formally revoked its acceptance of the vessels. ICGS Director of Contracts Kevin J. O'Neill replied in writing on May 23 saying the ICGS did not recognize the government's right to revoke the acceptance. Bible's reply, on June 5, dropped a bomb: "In addition to the hull buckling and shaft alignment problems identified in the May 17 letter, the revocation is also based on . . . class-wide issues, including non-conforming topside equipment."
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