By Calvin Biesecker

As the Coast Guard continues to assume a greater systems integration role over its Deepwater modernization program, the contractor originally hired for the lead systems integration job will eventually probably have nothing to do with the program, service acquisition officials said yesterday.

Two years ago about two-thirds of the Coast Guard’s Deepwater budget went to Integrated Coast Guard Systems (ICGS) and that figure is down to about one-third now, Rear Adm. Ronald Rabago, director of acquisition programs for the Coast Guard, told reporters yesterday. The dollars flowing to ICGS just keep “shrinking” moving forward, he said.

Even though ICGS will phase out of the program, Lockheed Martin [LMT] and Northrop Grumman [NOC], the two companies that comprise the Deepwater integration team, the Coast Guard will continue to have long-term relationships with both companies, Rear Adm. Gary Blore, assistant commandant for acquisition, said.

That’s because Northrop Grumman is building the Coast Guard’s fleet of high-endurance National Security Cutters (NSC) and Lockheed Martin is integrating the service’s new maritime patrol aircraft. Lockheed Martin also has the responsibility for the C4ISR systems aboard the NSC as well as previous upgrades to the Coast Guard’s fleet of legacy cutters, work that has been deemed very successful by the service.

The actual contracts for these programs run through ICGS, which in turn subcontracts the work to the two big defense contractors. But beyond the existing Deepwater programs that the two companies are under contract for, future procurements will be open competitions, Coast Guard acquisition officials said.

While Lockheed Martin, through its role as the C4ISR provider under Deepwater, has provided much of the glue that allows the current Deepwater and legacy assets to achieve a high degree of interoperability, the Coast Guard is confident that can be successful here in the future regardless of the contractor.

“I don’t think we’re dependent on Lockheed to do the systems engineering and integration,” Blore said.” I think that we will use them when they provide best value and there’s still a lot of Lockheed people that work on Deepwater but there’s a lot of General Dynamics‘ [GD] and other people that work on other aspects of acquisition and we’re all in one organization right now…As we move more of the systems integration to the government, especially on the C4ISR realm, I think you’re going to see our technical authority Adm. Dave Glenn using his assets to let contracts with different manufacturers, or with different parts of the overall system. And when I say overall system, I don’t think of Deepwater as the overall system. I think of the Coast Guard as the overall system.”

Rabago said the ongoing competition for a new patrol boat, called the Fast Response Cutter (FRC), is a good example of how the Coast Guard will move forward, particularly in the C4ISR area. “We did not say you had to go back to Lockheed or Northrop to get any of this,” he said. “We were very prescriptive in our RFP (Request for Proposals) on that vessel and you’re going to see that that’s the way we’re going to go forward in procuring these assets as we move forward.”

Bids are due this month for the FRC program with an award slated for next spring. The service plans to buy patrol boat based on an existing design. The existing design plan, called FRC-B, was originally intended as a stopgap measure to fill a shortage in patrol boat hours plaguing the Coast Guard with the longer-term plan being the development of a new vessel, possibly based on a composite hull design. The long-term plan, called the FRC-A, has been shelved for the time being. Blore said that while the Coast Guard doesn’t expect the FRC-B craft to meet all of its requirements for a new patrol boat, if the design that is selected comes close, then over time the service may decide to upgrade the vessel so that it meets its future needs.

The Coast Guard is awaiting the outcome of an independent review of its planned platform acquisitions within Deepwater to make sure they still meet post-9/11 requirements. Blore said the Alternatives Analysis is due in March although the service will be briefed this month and next in order for it to have input in the FY ’09 budget, which will be released in early Feb. 2008.