By Calvin Biesecker and Geoff Fein
The Government Accountability Office (GAO) on Monday denied a protest by Marinette Marine of potential $1.5 billion award made by the Coast Guard to Bollinger Shipyards last October to design and construct the service’s new Sentinel-class Fast Response Cutters (FRC).
Immediately following the GAO’s ruling, the Coast Guard lifted a stop work order it had imposed on Bollinger after Marinette Marine had filed the protest (Defense Daily, Oct. 9, 2008). The initial $88 million contract was awarded last September (Defense Daily, Sept. 29).
The Coast Guard all along had expected its award to stand up.
The Coast Guard never thought the protest had merit, Rear Adm. Gary Blore, assistant commandant for acquisition and chief acquisition officer, told reporters yesterday during a briefing by cell phone from Germany.
The protest gave GAO the opportunity to completely review the way the Coast Guard does acquisitions, he added.
“It gave us an opportunity to confirm what we knew ourselves, but we have a very experienced independent third part in GAO who is upholding that,” Blore said. “It is an important statement that the Coast Guard is doing acquisition correctly.”
Blore pointed out that the GAO went through every aspect of how the contract was awarded.
“[They] are basically saying it was awarded properly and in accordance with the FAR (Federal Acquisition Regulation), so this is important to us because one, the patrol boat is so critical to the future Coast Guard and the missions we want to execute for the public,” Blore said. “But as I have spoken to before a couple of years ago [Coast Guard Commandant] Adm. [Thad] Allen started us on this path toward acquisition reform and we said that this project would be the project that showed we had our acquisition processes correct and we were going to do it right.
“In the one sense this decision is much bigger to me than just the patrol boat. Although the patrol boat in and of itself is critical, it’s big because of the general statement it makes about our acquisition process because this is the same process we use now for everything,” he added.
The Coast Guard will shortly begin working on detailed design of the FRC, Blore added.
“It’s a parent craft based on a Damen design. I just had opportunity to meet with Mr. Damen…I went through Damen design studios and looked at the outstanding work they do there,” Blore said.
Damen Shipyards is located in the Netherlands.
“Damen as design agent, Bollinger and the Coast Guard will take out the parent craft and the blueprints for the parent craft, do those basic modifications we are doing to the patrol boat, which are not extensive, and we will redo the blueprint so we can go into construction for first [FRC],” he added.
Bollinger is designing the 153-foot patrol boat based on a Dutch parent craft design called the Damen 4708. The contract calls for building up to 34 Sentinel– class FRCs, which will replace the Coast Guard’s aging fleet of 110-foot Island-class cutters. The $1.5 billion potential value of the award is based on delivery of all 34 boats.
The first patrol boat is slated for delivery in two years, January 2011. The stop work order resulted in a delay of several months to the program schedule. The Coast Guard expects the preliminary design review to occur in three months and a detailed design review to be completed in nine to 10 months.
Wisconsin-based Marinette Marine is part of Fincantieri Marine Group Holdings, a subsidiary of Italy’s Fincantieri. Lockheed Martin [LMT] is also an investor in Marinette Marine.
Blore noted the Coast Guard lost one day of work on FRC for every day the protest was under review by GAO. “We will lose 100 days from the original schedule. As soon as we get a chance to collect our breath, we will redo the schedule and make sure it is available to everybody.”
The schedule delay shouldn’t add to the cost of the FRC program, Blore added.
“I don’t think it would significantly affect the cost because wee haven’t actually started,” he said. “There are provisions in the contract for consumer price index adjustments, but I don’t think that’s really a factor at this point.”