Coasties Stripped of Acquisition Power

The Department of Homeland Security has stripped acquisition decision authority from the Coast Guard in the wake of the service's disastrous management of the Deepwater program. The Coast Guard joins the Air Force and National Reconnaissance Office in having decision authority stripped from it. The Air Force lost decision authority over all space programs in March 2005 and is unlikely to regain it any time soon. The NRO was stripped of decision authority over the BASIC satellite program early this year. The NRO is granted decision authority program by program and that authority is regularly reviewed.

According to an Oct. 28 Coast Guard press statement, "the rescission of acquisition decision authority does not imply removal of Coast Guard management of major acquisition projects." But it really does mean the Coast Guard has lost the fundamental legal and policy authority to allow a program to move from one acquisition milestone to another since that is what constitutes the milestone decision authority is.

As the release notes, Coast Guard "major projects are reviewed and approved by DHS at each prescribed decision milestone. Prior to DHS approval to proceed toward the next milestone, the Coast Guard must demonstrate the project is properly progressing by satisfying milestone and acquisition plan criteria."

Appropriations for the Deepwater Program totaled over $4 billion as of fiscal year 2008. Deepwater is intended to replace or modernize 15 major classes of Coast Guard assets, five each of vessels and aircraft, and five other projects, including command, control, communications, computers, intelligence, surveillance, and reconnaissance systems. A joint venture of Lockheed Martin and Northrop Grumman serving as lead system integrator was awarded the Deepwater contract in 2002.

The new arrangement should help DHS get the Coast Guard back on track, according to Robbin Laird, a defense consultant who has worked with the Coast Guard.

"With the coming of the new administration funding of appropriate homeland security functions is crucial. With this transfer of authority, DHS will be in a position to shape the future of the USCG and its approach to the future. The Deepwater C4ISR remains central to the new missions of the USCG and have been performed well; uncertainity about ship acquisitions have created the problem," Laird said.

One new approach might be for the DSH to to "work with the Navy to acquire common littoral ships for the littoral missions. What remains important is to keep the commonality of systems to work with civilian, commercial, law enforcement and military authorities in the US and worldwide in the C4ISR domain. Hopefully, DHS will continue to re-enforce commonality in this area with other US agencies and global agencies. What began as a reform under Admiral Currier has now become the DHS ownership of USCG modernization."

One important issue that DHS and the Coast Guard need to address is what will happen to the roughly 1,000 Coast Guard acquisition personnel. In particular, Laird noted that the question of "who will they really report to" needs to be answered.

The Government Accountability Office recommended stripping the Coast Guard of this authority in June. And language requiring the action, "due to the Coast Guard's failure to adequately oversee the Deepwater program," was included in the recently passed consolidated appropriations bill and its accompanying report.

The Coast Guard statement tries to put the best face on the service's progress, noting the the GAO report says they have "begun to follow the disciplined, project management framework of its Major Systems Acquisition Manual (MSAM), which requires documentation and high-level executive approval of decisions at key points in a program’s life cycle." But it you read the next few sentences, you get a clear picture of just why decision authority was stripped from the service. "But the consequences of not following this approach in the past are now evident, as Deepwater assets have been delivered without a determination of whether their planned capabilities would meet mission needs. The MSAM process currently allows limited initial production to proceed before the majority of design activities have been completed. In addition, a disconnect between MSAM requirements and current practice exists because DHS had earlier delegated to the Coast Guard all Deepwater acquisition decisions, resulting in little departmental oversight."