[House Hearing, 114 Congress]
[From the U.S. Government Publishing Office]

COAST GUARD ARCTIC IMPLEMENTATION CAPABILITIES

=======================================================================

(114-49)

HEARING

BEFORE THE

SUBCOMMITTEE ON
COAST GUARD AND MARITIME TRANSPORTATION

OF THE

COMMITTEE ON
TRANSPORTATION AND INFRASTRUCTURE
HOUSE OF REPRESENTATIVES

ONE HUNDRED FOURTEENTH CONGRESS

SECOND SESSION

__________

JULY 12, 2016

__________

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COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE

BILL SHUSTER, Pennsylvania, Chairman
DON YOUNG, Alaska PETER A. DeFAZIO, Oregon
JOHN J. DUNCAN, Jr., Tennessee, ELEANOR HOLMES NORTON, District of
Vice Chair Columbia
JOHN L. MICA, Florida JERROLD NADLER, New York
FRANK A. LoBIONDO, New Jersey CORRINE BROWN, Florida
SAM GRAVES, Missouri EDDIE BERNICE JOHNSON, Texas
CANDICE S. MILLER, Michigan ELIJAH E. CUMMINGS, Maryland
DUNCAN HUNTER, California RICK LARSEN, Washington
ERIC A. ``RICK'' CRAWFORD, Arkansas MICHAEL E. CAPUANO, Massachusetts
LOU BARLETTA, Pennsylvania GRACE F. NAPOLITANO, California
BLAKE FARENTHOLD, Texas DANIEL LIPINSKI, Illinois
BOB GIBBS, Ohio STEVE COHEN, Tennessee
RICHARD L. HANNA, New York ALBIO SIRES, New Jersey
DANIEL WEBSTER, Florida DONNA F. EDWARDS, Maryland
JEFF DENHAM, California JOHN GARAMENDI, California
REID J. RIBBLE, Wisconsin ANDRE CARSON, Indiana
THOMAS MASSIE, Kentucky JANICE HAHN, California
MARK MEADOWS, North Carolina RICHARD M. NOLAN, Minnesota
SCOTT PERRY, Pennsylvania ANN KIRKPATRICK, Arizona
RODNEY DAVIS, Illinois DINA TITUS, Nevada
MARK SANFORD, South Carolina SEAN PATRICK MALONEY, New York
ROB WOODALL, Georgia ELIZABETH H. ESTY, Connecticut
TODD ROKITA, Indiana LOIS FRANKEL, Florida
JOHN KATKO, New York CHERI BUSTOS, Illinois
BRIAN BABIN, Texas JARED HUFFMAN, California
CRESENT HARDY, Nevada JULIA BROWNLEY, California
RYAN A. COSTELLO, Pennsylvania
GARRET GRAVES, Louisiana
MIMI WALTERS, California
BARBARA COMSTOCK, Virginia
CARLOS CURBELO, Florida
DAVID ROUZER, North Carolina
LEE M. ZELDIN, New York
MIKE BOST, Illinois
------ 7

Subcommittee on Coast Guard and Maritime Transportation

DUNCAN HUNTER, California, Chairman
DON YOUNG, Alaska JOHN GARAMENDI, California
FRANK A. LoBIONDO, New Jersey ELIJAH E. CUMMINGS, Maryland
BOB GIBBS, Ohio CORRINE BROWN, Florida
MARK SANFORD, South Carolina JANICE HAHN, California
GARRET GRAVES, Louisiana LOIS FRANKEL, Florida
CARLOS CURBELO, Florida JULIA BROWNLEY, California
DAVID ROUZER, North Carolina PETER A. DeFAZIO, Oregon (Ex
LEE M. ZELDIN, New York Officio)
BILL SHUSTER, Pennsylvania (Ex
Officio)
CONTENTS

Page

Summary of Subject Matter........................................ iv

TESTIMONY

Admiral Charles D. Michel, Vice Commandant, U.S. Coast Guard..... 4
Allison Stiller, Principal Civilian Deputy to the Assistant
Secretary of the Navy for Research, Development and
Acquisition, U.S. Navy, Department of Defense.................. 4
Jennifer Grover, Director, Homeland Security and Justice, U.S.
Government Accountability Office............................... 4
Ronald O'Rourke, Specialist in Naval Affairs, Congressional
Research Service............................................... 4
Heather A. Conley, Senior Vice President for Europe, Eurasia, and
the Arctic, Center for Strategic and International Studies..... 4
Matthew O. Paxton, President, Shipbuilders Council of America.... 4

PREPARED STATEMENTS SUBMITTED BY WITNESSES

Admiral Charles D. Michel........................................ 47
Allison Stiller.................................................. 55
Jennifer Grover.................................................. 58
Ronald O'Rourke.................................................. 77
Heather A. Conley................................................ 96
Matthew O. Paxton................................................ 103

SUBMISSIONS FOR THE RECORD

Admiral Charles D. Michel, Vice Commandant, U.S. Coast Guard:

Responses to requests for information from the following
Representatives:

Hon. John Garamendi of California

Hon. Duncan Hunter of California......................... 36

Responses to questions for the record from the following
Representatives:

Hon. Don Young of Alaska................................. 52
Hon Mark Sanford of South Carolina and Hon. Janice Hahn
of California.......................................... 53
Allison Stiller, Principal Civilian Deputy to the Assistant
Secretary of the Navy for Research, Development and
Acquisition, U.S. Navy, Department of Defense:

Responses to requests for information from the following
Representatives:

Hon. John Garamendi of California........................ 20
Hon. Don Young of Alaska................................. 40
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COAST GUARD ARCTIC IMPLEMENTATION CAPABILITIES

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TUESDAY, JULY 12, 2016

House of Representatives,
Subcommittee on Coast Guard and Maritime
Transportation,
Committee on Transportation and Infrastructure,
Washington, DC.
The subcommittee met, pursuant to notice, at 10:05 a.m. in
room 2167, Rayburn House Office Building, Hon. Duncan Hunter
(Chairman of the subcommittee) presiding.
Mr. Hunter. The subcommittee will come to order. Good
morning. Thanks for being here, everybody.
The subcommittee is meeting today to discuss the Coast
Guard's Arctic capabilities. The Coast Guard talks about its
assets through descriptions such as ``an asset's capacity or
capability.'' The term ``capacity,'' as I understand, is a
quantitative term which refers to how much, to what scale or
volume a mission can be performed by the asset, and the term
``capability'' refers to the kinds of missions an asset can
perform.
At our June hearing on Coast Guard mission needs and
resource allocation, the GAO reported that Coast Guard assets
new and old are not performing to capacity, creating mission
gaps. In addition, GAO noted that the Coast Guard allocates
resource hours at levels that are higher than actual asset
usage hours--in fact, we probably spent about 10 or 15 minutes
understanding this in the last hearing--also creating mission
gaps, but potentially, a more artificial mission gap, depending
on whether you believe the allocated resource hours are based
on reality.
The reason I make that statement is for us in Congress to
understand the needs of the Service we need to understand the
current abilities of Coast Guard assets. Not the projected
ability of an asset to meet mission needs, but its actual
ability to perform a mission and the kind of missions it can
support.
The Coast Guard has testified that its heavy icebreaker,
the Polar Star, has the capacity--excuse me, has the capability
of accessing any ice-covered region 24/7, 365 days of the year.
It may have the capability, but by all accounts it does not
have the capacity due to its age and maintenance needs. In
fact, I think we figured out that the Polar Star can actually
be on the ocean about 180 days out of the year, so about half
the year.
The High Latitude Region Mission Analysis revealed the
following Coast Guard missions--defense readiness, ice
operations, marine environmental protection, and ports,
waterways and coastal security--in the Arctic were
significantly impacted by the gap in mission performance. It is
these gaps and the knowledge that when the Polar Star reaches
the end of its extended service life we may have a period where
the Coast Guard does not have a heavy icebreaker at all.
Progress is being made on the acquisition front, with $1
billion in the Senate defense bill for the first ship in the
Polar Icebreaker Recapitalization Project. It has a way to go,
but it is positive progress. I have supported this acquisition
and annual funding for it in House appropriations bills, as
have many of my colleagues.
I want to reiterate again that the Coast Guard and this
committee are in lockstep on the need for a heavy icebreaker.
But as we work towards the acquisition of our Nation's first
heavy icebreaker since 1978, all of us have the inherent duty
to have a discussion on what we will do now and continue to do
until we deploy the appropriate number of icebreakers over the
next several decades. And we are talking a decade out, at
least, for the first icebreaker that we build.
My concerns continue to lie with current mission gaps in
the Arctic, particularly defense readiness, due to the
inability of assets to support year-round missions in the
region. And I believe this is the responsibility that the Coast
Guard and Navy should share.
So again, what is the plan, in the short term, to fill this
gap? We heard at the June hearing that the material assessment
for the Polar Sea will be sent to this committee conveniently
after Congress gets out this month, on July 24. Just shy of 3
years after the deadline mandated in statute for making a
determination of whether it is cost-effective to reactivate the
Polar Sea, and 6 years since the vessel last operated, the
Coast Guard will provide the committee a report on the
condition of the vessel.
But don't worry that the Coast Guard is moving too swiftly
or without deliberate care. We have been assured the material
assessment will not even contain a recommendation for action,
simply an assessment on the ship. This is the start of the
process to see if she can be reactivated. Further information
will not come until the alternative analysis is sent to
Congress at the end of the calendar year, so we are looking at
about 7 years since the Polar Sea last operated, and more
than--almost 4 years since Congress passed a law that said that
the Coast Guard is going to give us an analysis on whether the
Polar Sea can be reactivated or not, and how much it would
cost.
Time is ticking away and the vessels in the Coast Guard
icebreaker fleet are either inoperable, aging and in need of
extended time in dry dock, or incapable of working on ice-
covered areas. Not a good situation to be in, but here we are.
I look forward to hearing from the witnesses today and
discussing this important topic with them.
And lastly, I would just like to say, too, we talked to
Secretary Stackley in the Navy and Admiral Michel, and we
talked about creating a Naval-Coast Guard kind of collaboration
office, a joint program office. Are we willing to do that
today?
Ms. Stiller. Yes, sir. I am going to speak on behalf of Mr.
Stackley, but yes, we are committed to working together to put
together a memorandum of understanding on how we would work
together collaboratively on the icebreaker.
Mr. Hunter. Fantastic. And with that I yield to Ranking
Member Garamendi.
Mr. Garamendi. Thank you, Mr. Chairman. And this is another
very, very important hearing on the issues of the Coast Guard
and the Arctic.
There is an old adage which states that failing to plan is
planning to fail. Fortunately, when it comes to the Arctic
region, by just about any measure the volume of planning
initiatives undertaken by the Federal Government over the last
several years has been both comprehensive in scope and
substantial in number.
The National Arctic Strategy, the Coast Guard High Latitude
Regional Mission Analysis, the Army Corps Arctic Deepwater Port
Study are just a few of the studies that have been undertaken.
They clearly demonstrate that there is no failure to plan for
what will be a whole-of-government enterprise for many years to
come. But at this point what is needed, now more than ever, is
decisive and thoughtful decisionmaking, not only within the
administration but also here in Congress. And that is why this
hearing is so very important today.
Whether or not you believe that the Earth's climate is
warming due to increased emissions of manmade greenhouse gases,
that is not terribly relevant. The physical reality quickly
unfolding across the High North and Antarctic continents is
extremely relevant. The shrinking Arctic ice coverage, the
caving of Antarctic ice sheets, Greenland's glaciers retreating
at a pace never before recorded are each separately stunning
developments. Taken together, however, they expose two
unforgiving remote regions of the world in the midst of a
rapid, wenching, systematic, environmental change. And if we
have learned anything, we should expect the actual pace of
environmental change in each polar region to far exceed the
rates projected by our climate models.
So too we must expect human use of the Arctic to accelerate
much faster than projected. And consequently, the Coast Guard,
the Navy, and other Federal agencies will have to grapple with
new demands and challenges far sooner than anticipated. That is
why we must now switch gears from planning to action. Time is
critical, and something we can ill afford to waste. We must
begin to make some very hard but important decisions. We must
ensure that the United States can decisively project and
resolutely protect its sovereign interest in the Arctic and
fulfill its international obligations in the Antarctic.
For example, if we need a new heavy icebreaker, let's get
on with cutting the steel and laying the keels for these new
hulls now. If we need new Arctic deepwater ports, let us
identify the sites and set the Corps of Engineers to work. If
we need to ensure emergency communications and safe navigation
in the Arctic, let us appropriate the funding and direct the
Coast Guard to get this underway.
All of these things and much more we need to do. But if we
hope to shape our future in the Arctic and Antarctic, we must
take decisive action before events in those rapidly evolving
frontiers overwhelm our capability to respond effectively. Now
is the time for us to act, to make decisions, and to set in
place the laws and money to get the job done.
Mr. Chairman, I look forward to this hearing.
Mr. Hunter. I thank the gentleman. Let me introduce our
witnesses today. They are Admiral Charles Michel, Vice
Commandant of the U.S. Coast Guard; Ms. Allison Stiller,
Principal Civilian Deputy to the Assistant Secretary of the
Navy for Research, Development and Acquisition for the U.S.
Navy; Ms. Jennifer Grover, Director of Homeland Security and
Justice for the Government Accountability Office; Mr. Ronald
O'Rourke, specialist in naval affairs with the Congressional
Research Service; Ms. Heather A. Conley, senior vice president
for Europe, Eurasia, and the Arctic for the Center for
Strategic and International Studies; and Mr. Matthew Paxton,
president of the Shipbuilders Council of America.
Admiral, we will start with you. You are recognized.

TESTIMONY OF ADMIRAL CHARLES D. MICHEL, VICE COMMANDANT, U.S.
COAST GUARD; ALLISON STILLER, PRINCIPAL CIVILIAN DEPUTY TO THE
ASSISTANT SECRETARY OF THE NAVY FOR RESEARCH, DEVELOPMENT AND
ACQUISITION, U.S. NAVY, DEPARTMENT OF DEFENSE; JENNIFER GROVER,
DIRECTOR, HOMELAND SECURITY AND JUSTICE, U.S. GOVERNMENT
ACCOUNTABILITY OFFICE; RONALD O'ROURKE, SPECIALIST IN NAVAL
AFFAIRS, CONGRESSIONAL RESEARCH SERVICE; HEATHER A. CONLEY,
SENIOR VICE PRESIDENT FOR EUROPE, EURASIA, AND THE ARCTIC,
CENTER FOR STRATEGIC AND INTERNATIONAL STUDIES; AND MATTHEW O.
PAXTON, PRESIDENT, SHIPBUILDERS COUNCIL OF AMERICA

Admiral Michel. Well, thank you, Chairman Hunter, Ranking
Member Garamendi. Thanks for the opportunity to appear before
you today to discuss Coast Guard capabilities in the Arctic. I
ask that my written statement be accepted as part of the
official record.
Guided by the National Strategy for the Arctic Region and
our own Arctic strategy, the Coast Guard is responding to
increasing mission demands in this important region. The Arctic
presents unique opportunities and challenges to United States
interests. U.S. security in the Arctic encompasses a broad
spectrum of activities, ranging from those supporting safe
commercial and scientific operations to national defense. To
respond to this challenge, the United States must have the
ability to safely and reliably operate here year-round.
Indeed, U.S. sovereignty and security interests in the
Arctic hinge upon assured access, and heavy icebreakers are the
only assets capable of dependably fulfilling this critical
requirement for surface access. Yet the Coast Guard's heavy
icebreaker inventory, which is our entire national capability,
consists of a single operational vessel, which is 40 years old,
the Polar Star. This is why we are answering the President's
call to accelerate recapitalization of a new heavy icebreaker,
and are planning for the construction of additional
icebreakers.
Mr. Chairman, the Coast Guard shares your sense of urgency
for this new capability and is grateful to your support of our
effort to accelerate the heavy icebreaker acquisition. As you
know, this is the Coast Guard's immediate icebreaking priority,
based on the age and material condition of our current fleet
and our limited resources. I also take very seriously your
concerns regarding the state of our current capability and the
length of time it will take to deliver a new heavy icebreaker.
The Coast Guard is committed to continue working with
Congress, the Navy, and industry to address these concerns, and
I would like to tell you what we are doing on this front.
First, we remain committed to maintaining heavy icebreaking
capability while we proceed with recapitalization. To do this,
we must make a decision on whether to reactivate Polar Sea or
extend Polar Star's service life. To support this decision we
just completed a 7-month material inspection on Polar Sea,
including pulling her out of the water, and look forward to
sharing our results with you later this month, formally. In
accordance with the Coast Guard Authorization Act of 2015 we
have also commenced the necessary alternatives analysis to
inform this important decision that will be made by the end of
this calendar year.
Based on what we know now, I can tell you that refurbishing
Polar Sea would be a significant undertaking, and would likely
far exceed the cost and scope of work that was needed to
reactivate Polar Star.
Second, as you know, we are committed to exploring all
possible alternatives to best accelerate our acquisition of new
heavy icebreakers. To assure continued momentum and selection
of the best acquisition strategy, we are leveraging our strong
and longstanding partnership with the Navy, as you noted
earlier, sir. To this end, we are working with the Navy to
develop a program plan to efficiently and effectively move the
icebreaker program forward, considering mechanisms such as
block buys, multiyear procurements, and other opportunities to
acquire icebreakers as quickly and responsibly as possible.
Similar to our experience working with the Navy to build
Healy, a cooperative partnership that leverages the Navy's
expertise in designing and acquiring ships will provide mutual
benefits to both services, and will energize the U.S.
shipbuilding industrial base.
Third, we are assessing additional Arctic needs and
planning for construction of additional icebreakers. While
multimission medium icebreakers such as Healy are less capable
than heavy icebreakers, they can provide important capacity
during certain seasons and certain ice conditions. We have
recently chartered an integrated product team, or IPT, to
define an operating concept and requirements for medium
icebreakers. That IPT will survey available technologies and
assets to inform the operational requirements for those
vessels.
Fourth, while we proceed with recapitalization of a new
heavy icebreaker, we are fully committed to exploring ways to
address evolving U.S. security interests in the Arctic in the
near term. We have aggressively reached out to industry across
the globe, seeking out the latest in icebreaking technology.
While single-mission icebreakers built to commercial standards
are available on the global market, we have not yet identified
any available multimission medium or heavy icebreakers suitable
for military service. However, we are continuing to look. Given
the urgency, we are open to considering any suitable options
that could fulfill our unique authorities and multimission
requirements.
Fifth, we are working with allies through engagements like
the Arctic Coast Guard Forum to utilize our limited icebreaker
capability to achieve better operational effect. This will
include combined and joint operations with our allies.
In closing, thank you for support of our effort to
accelerate the acquisition of a new heavy icebreaker to replace
the aging Polar Star, as U.S. security interests in the Arctic
ultimately hinge upon having assured year-round access. We look
forward to working with Congress, the Navy, and industry to
identify ways to responsibly accelerate the acquisition of a
new heavy icebreaker, continue planning the construction of
additional icebreakers, and explore capabilities that might be
brought to bear to address our near-term concerns.
Thank you for your support of the Coast Guard and your
efforts to ensure our men and women in uniform have the
capabilities they need to safely and reliably execute our vital
missions.
Thank you for the opportunity to testify, and I look
forward to your questions.
Mr. Hunter. Thank you, Admiral.
Ms. Stiller?
Ms. Stiller. Chairman Hunter, Ranking Member Garamendi, and
distinguished members of the subcommittee, thank you for the
opportunity to discuss the Navy's ongoing and continued
involvement with the Coast Guard on ship design and ship
construction programs. I request that my written statement be
entered into the record.
The Navy fully supports the President's National Strategy
for the Arctic Region and its corresponding implementation
plan. The Navy also looks forward to working with Congress and
the Coast Guard to answer the President's call to accelerate
the recapitalization of heavy icebreaking ships to meet our
national interests in the changing Arctic region.
The ``U.S. Navy Arctic Roadmap 2014 through 2030'' aligns
with the national and Department of Defense Arctic strategies,
and includes a plan that directs the development of Arctic
capabilities and capacity in step with the changing
environmental conditions. The Navy's four strategic objectives
in the Arctic include ensuring U.S. Arctic sovereignty,
providing ready naval forces; preserving freedom of the seas;
and promoting partnerships.
The Navy will continue our strong cooperative partnership
with the Coast Guard in addition to the interagency and
international Arctic region stakeholders to address emerging
opportunities and challenges presented by the seasonal opening
of Arctic ocean waters. The risk of conflict in the region is
low, and the Arctic Council and other diplomatic venues provide
effective means to resolve disputes between nations. However,
the Navy will continue to exploit all opportunities that will
provide our sailors with superior maritime knowledge of the
Arctic.
We will work closely with the Coast Guard to acquire the
first heavy icebreaker in 2020, as defined by their recently
approved Operational Requirements Document. Coupled with the
congressional support, both the Navy and Coast Guard are
working to develop a program plan to efficiently and
effectively move the icebreaker program forward.
As you know, the Navy has a long history of designing and
acquiring ships, and we have offered our full range of
experience and expertise to the Coast Guard and the icebreaker
program. We are aware of the Coast Guard acquisition team's
progress in executing an analysis of alternatives which, along
with industry involvement, will inform the icebreaker
acquisition strategy.
Together we are working to understand the best way to
maximize our cooperative partnership and leverage the expertise
of both of our agencies. The Navy is committed to the success
of this icebreaker program, and we offer the support of our
acquisition community during the design, development,
construction, test, and delivery processes.
We stand ready to provide shipbuilding expertise in
acquisition career fields, including program management,
engineering, cost estimating, test, and manufacturing. We will
provide access to facilities such as the model basin tow tank
at Naval Surface Warfare Center to help retire technical risks
during the design phase of the program. We will provide cost
estimating support, as design tradeoffs are made.
We will also provide lessons learned on reuse of systems
and components in the design phase to mitigate construction and
support costs. In addition, we will work with the Coast Guard
and industry to identify high-risk production processes, and
propose ways to mitigate these risks to alleviate rework during
the construction.
The Navy and the Coast Guard both stand to see the mutual
benefit in this cooperative arrangement by using best practices
to strengthen the shipbuilding industry base, and reduce costs
in our Naval and Coast Guard new construction programs. The
Navy stands alongside the Coast Guard in this endeavor to see
the icebreaker program become a success.
Again, thank you for the opportunity to appear before you
today, and I look forward to your questions.
Mr. Hunter. Thank you, Ms. Stiller.
Ms. Grover, good to see you again.
Ms. Grover. Thank you. Good morning, Chairman Hunter,
Ranking Member Garamendi. The Coast Guard is responsible for
carrying out its missions, including search and rescue and
defense readiness in the Arctic waters, as in other areas. As
diminishing sea ice may make the Arctic waters more attractive
for commerce and tourism, the issue of Coast Guard Arctic
capabilities becomes a more pressing issue.
My statement today will focus on two points: first, the
Coast Guard's actions to address known Arctic capability gaps;
and second, the Coast Guard's polar icebreaking capabilities.
The Coast Guard is well aware that it faces significant
capability gaps in the Arctic, as do other organizations with
operations in that area. For several years the Coast Guard has
reported challenges, including a lack of reliable
communications, limited nautical charting, and insufficient
infrastructure for operating their aircraft and vessels. For
example, there is limited aircraft infrastructure on the North
Slope, and no deepwater ports on the North Slope or near the
Bering Strait for refueling and reprovisioning Coast Guard
cutters.
The Coast Guard is working in close collaboration with
other Federal agencies to address these and other capability
gaps. For example, the Coast Guard used its 2015 Arctic Shield
activities to test navigation systems and DOD communications
equipment. In a report on the Coast Guard's Arctic capabilities
that was conducted at the request of this subcommittee and
being released today, GAO recommended that the Coast Guard
begin systematically assessing the extent to which its actions
have helped to mitigate Arctic capability gaps. The Coast Guard
agreed and reported plans to begin doing so.
Regarding icebreaking, the Coast Guard has initiated the
process to acquire a new heavy icebreaker. Although the Coast
Guard is considering all options, several factors make the
purchase of a new icebreaker a more likely outcome than leasing
one.
For some of its missions, the Coast Guard is required to
use a public vessel, which Federal law defines as one that the
U.S. owns or demise charters, which is a special type of lease
where the Coast Guard would have to crew, operate, and maintain
the leased vessel. Also, Coast Guard vessels, whether purchased
or leased, must be built in a U.S. shipyard. The Coast Guard
has determined that no heavy icebreaker currently exists for
purchase or lease that would meet its requirements, which means
that one must be constructed, either via a Coast Guard purchase
or for the purposes of a demise lease.
In considering these two options it is important to note
that OMB requires agencies to acquire assets in the least
costly manner. Prior analyses by the Coast Guard suggest that a
lease option would likely cost the Federal Government more than
a purchase over the icebreaker's expected 30-year service life,
due to the ship owner's profit rate. Previous GAO work has
echoed those findings that outright purchase can be a less
costly alternative, compared to long-term vessel lease due to
profit rate and the expected differences in Government versus
private-sector borrowing costs.
As you have noted, while the acquisition process is
underway, the Coast Guard risks operating for some time with no
heavy icebreaker capacity. They are exploring their options,
but have not made any bridging decisions yet.
In conclusion, the Coast Guard has taken important steps
toward enhancing its Arctic operations. It is taking action to
address known Arctic capability gaps, and has initiated the
acquisition of a new heavy icebreaker. Moving forward, the
Coast Guard could further enhance its capabilities by better
understanding the impact of its actions on those Arctic
capability gaps, and by determining how to bridge the gap
between the Polar Star and a new icebreaker.
Chairman Hunter, Ranking Member Garamendi, this concludes
my statement and I look forward to your questions.
Mr. Hunter. Thank you, Ms. Grover.
Mr. O'Rourke?
Mr. O'Rourke. Chairman Hunter, Ranking Member Garamendi,
distinguished members of the subcommittee, thank you for the
opportunity to appear before you today to discuss Coast Guard
Arctic implementation capabilities.
Mr. Chairman, with your permission I would like to submit
my written statement for the record and summarize it here
briefly.
Mr. Hunter. Without objection. And all the witnesses'
written statements will be entered into the record in full.
Mr. O'Rourke. As requested, my testimony focuses on
acquisition of polar icebreakers, and particularly on savings
that could be realized in acquiring two polar icebreakers. I
have seven points I would like to make.
The first is that, given the potential requirement for up
to three heavy and three medium polar icebreakers, a single new
polar icebreaker would narrow but not necessarily close a
potential gap in polar icebreaking capability. Any remaining
gap could be further narrowed by a second new polar icebreaker.
My next point is that there are various possible approaches
for acquiring two polar icebreakers. One approach, which is a
potential baseline or default approach, would be to build the
ships several years apart from one another, contract for them
separately, and purchase materials and components for them
separately.
A potential alternative approach would be to build the
ships only a few years apart from one another, contract for
them together under a block buy contract, and carry out a
combined purchase of materials and components for the two
ships.
My third point is that, compared to the potential baseline
or default approach, the alternative approach would compress
the funding stream for the two icebreakers into a smaller
number of years, increasing average annual funding
requirements, and reduce policymaker flexibility regarding
whether and when to build the second ship, what design to build
it to, and what shipyard to build it in. It would also likely
get the second ship into service sooner, more quickly narrowing
the potential gap in icebreaking capability, and it could
reduce the combined acquisition cost of the two ships by at
least 5 percent, and perhaps closer to 10 percent. This could
equate to a savings of at least $100 million or so, and perhaps
closer to $200 million.
My fourth point is that this savings of $100 million or
perhaps closer to $200 million would be generated in three
areas. First, the closer spacing between the ships could result
in less loss of shipyard learning in shifting from the first
ship to the second. Next, the use of a block buy contract would
permit the shipyard to optimize its workforce and capital plant
for a two-ship production run. And lastly, a combined material
purchase would improve production economies of scale at
material and component suppliers.
My fifth point is that the $1 billion that the Senate
Appropriations Committee has recommended for a new polar
icebreaker in the DOD Appropriations Act would more or less
fully fund the acquisition of that ship. Alternatively, with
congressional approval, an appropriation of $1 billion could be
used to partially fund a two-ship acquisition. Under this
scenario, the $1 billion would be used to develop the design,
fund a combined purchase of materials and components for the
two ships, and initiate construction on the first ship. The
remainder of the funding for the two-ship acquisition would be
provided in future fiscal years.
My sixth point is that if a shipyard that is awarded a
contract to build one or more new polar icebreakers happens to
be building other Coast Guard or Navy ships, then the addition
of the icebreaker work could marginally reduce the cost of
those other Coast Guard or Navy ships by absorbing some of the
shipyard's fixed overhead costs.
My seventh and final point is that there are two options
for temporarily narrowing a gap in polar icebreaking capability
in the nearer term, prior to the entry into service of one or
more new polar icebreakers. One would be to further extend the
service life of Polar Star or Polar Sea; the other would be to
charter one or more foreign polar-capable icebreakers, if such
ships were available for charter. The United States has used
both approaches in the past to mitigate polar icebreaking
capability gaps. Whether either of these approaches would be
feasible and cost effective in coming years would need to be
examined.
Mr. Chairman, this concludes my remarks. Thank you again
for the opportunity to testify, and I look forward to the
subcommittee's questions.
Mr. Hunter. Thank you, Mr. O'Rourke.
Ms. Conley?
Ms. Conley. Chairman Hunter, Ranking Member Garamendi, it
is a privilege to testify before you today. I would like to
provide the subcommittee with some broader thoughts on Arctic
national security challenges and their relationship to U.S.
readiness and capabilities.
While the United States has always prioritized its national
security interests in the Arctic in a variety of strategic
documents, there is a lack of consensus about what exactly
constitutes national security in the Arctic. Some define Arctic
national security in terms of America's missile defense
architecture in Fort Greely Air Base in Alaska or Thule Air
Force Base in Greenland, the increased presence of Russian
special forces and the placement of surface to air missiles on
remote Russian Arctic islands, as well as the increased
activity of Russian submarines in the North Atlantic.
Yet for others, security in the Arctic means search and
rescue operations, oil spill response, infrastructure
development, greater maritime domain awareness, U.S. energy
security. Still others view water, food, and human security of
indigenous populations, as well as coastal village relocation,
as security matters.
There is so much definitional confusion about Arctic
security because it encompasses all forms, all of these forms
of security, from missile defense to search and rescue to food
security.
The Obama administration has primarily focused on the human
and environmental dimension of the Arctic security challenge,
which is certainly considerable. Senior officials have tended
to discount or deny significant changes to Russia's military
posture in the Arctic, but other Arctic nations such as
Denmark, Finland, and Norway have recognized the growing hard
security threats in the Arctic, and have begun to make
necessary adjustments to their defense budgets and force
posture.
It is clear to me that the projection of power in the
Arctic today and in the future will be increasingly defined by
both traditional hard power, as we are seeing in Russia's
buildup of military presence in the Russian Arctic, as well as
softer power of superior logistics and infrastructure
capabilities, science, technology, the combined intuition of
traditional and 21st-century knowledge, accurate predictive
meteorological and ice modeling, and enhanced satellite
communications.
The projection of power in the Arctic will be multifaceted,
and will require a new U.S. approach to the region. So, will a
single heavy icebreaker meet America's comprehensive security
needs in the Arctic? It will not. But it will certainly enhance
the U.S. operational capacity, state of readiness, and ability
to respond and be resilient to the rapid changes in the Arctic.
But it is also important to note that this heavy icebreaker
is not solely intended for the Arctic. It will be utilized in
Antarctica, as the U.S. currently lacks additional and
redundant heavy icebreaker capabilities, should the recently
refurbished 1970s-constructed Polar Star become inoperable when
resupplying our research station in Antarctica.
Due to limited assets above the Arctic Circle, the Coast
Guard has at times been forced to rely on third-party
responders, asked other countries to loan us their spare
icebreaking capacity, and it is only by chance that the Healy,
in December of 2012, was in the right place at the right time--
and it wasn't originally supposed to be--to provide icebreaking
capabilities to provide emergency fuel to Nome, Alaska.
As the world's leading maritime power, the United States
has been living on good luck and borrowed time for far too
long, and I fear the future incident when our luck runs out.
But let us be clear. One heavy icebreaker is not a silver
bullet. It is not a substitute for enhanced satellite
communications, aviation assets, deepwater ports, navigational
aids, and internationally approved hydrographic mapping. It
does not solve the funding challenges of the long-range radar
sites in Alaska, which track aircraft through Alaskan airspace
and along its borders. It doesn't serve our emergency
airfields, our halfway points for refueling. It doesn't support
our Missile Defense Agency operations. It does not enhance our
military's cold-weather fighting capabilities. It does not
build a new U.S. Coast Guard operating base or station above
the Arctic Circle, which would improve search and rescue. It is
only one piece of the larger Arctic security puzzle.
It is these extremely limited capabilities that I have just
highlighted which call into question the ability of the U.S.
Coast Guard and the U.S. Government to be able to perform basic
national security tasks in the Arctic, let alone prevent future
oil spills, assist in mass casualty events, respond to shipping
accidents, acts of terrorism, ensure strong maritime law
enforcement actions in the Arctic. And my fear is that our near
exclusive focus on acquiring one heavy icebreaker will be
deemed sufficient for our needed focus and budget on a variety
of U.S. Arctic readiness initiatives. We must focus on the
comprehensive task now.
The Obama administration has taken a leadership role in
identifying readiness and preparedness as a major task for the
American Arctic, but it has been very slow to develop the
necessary infrastructure to implement these response
capabilities.
The U.S. Coast Guard recognizes the growing concern of
potential future maritime accidents in the narrow Bering
Straits and the heightened risk factor posed by increased
traffic through the Bering Straits, specifically LNG carriers
from the Russian Yamal LNG project.
Arctic security will be challenged this August by the
Crystal Serenity, a 1,700-passenger and cruise ship which will
traverse the ice-clogged Northwest Passage which has very
limited infrastructure.
Simply put, U.S. national security needs and challenges in
the American Arctic far surpass existing Coast Guard
implementation capabilities and the value added of acquiring
one heavy icebreaker. But acquiring a heavy icebreaker is a
critical step forward because the U.S. must be able to conduct
freedom of navigation operations in the polar regions.
The U.S. also needs similar icebreaking operational
capability redundancies in its medium strength icebreakers to
ensure effective law enforcement and search and rescue
capabilities.
We are in this position today because we have talked about
this problem for many years, but did not take effective action.
It is my hope that the acquisition of heavy icebreakers fuels
greater investment in U.S. Arctic infrastructure and,
hopefully, our defense capabilities as part of a multiyear and
prioritized budget to improve U.S. national security in the
Arctic.
Thank you.
Mr. Hunter. Thank you for that comprehensive testimony, Ms.
Conley.
Mr. Paxton, you are recognized.
Mr. Paxton. Thank you, Chairman Hunter, Ranking Member
Garamendi, and members of the subcommittee, for the opportunity
to testify this morning.
The Shipbuilders Council of America is the largest national
trade association representing the U.S. shipyard industry. The
SCA represents 83 members----
Mr. Hunter. Would you pull that mic right by--yes, thank
you.
Mr. Paxton. Oh, yes, sir. Sorry about that. The SCA
represents 83 member shipyard facilities and 94 industry
partner-member companies that are part of the vital supply
chain that make up the shipyard industrial base.
My testimony this morning will focus primarily on the
capability and capacity of the domestic shipyard industry to
build and maintain the next generation of polar icebreakers. In
addition, my testimony will speak specifically to the ability
of the U.S. shipyard industry to deliver polar icebreakers as
specified in the Coast Guard's polar icebreaker acquisition
directorate.
However, within the shipyard membership of this trade
association there are differing views on how the Coast Guard
might best acquire an updated polar icebreaker capability, so I
will refrain from promoting any specific approaches from these
specific shipyards.
The U.S. shipyard industry is certainly up to the task of
building polar icebreakers, and has the expertise, the
capability, the critical capacity, and the unmatched skilled
workforce to build these national assets. In fact, in a letter
sent to this subcommittee nearly 5 years ago, SCA member
companies urged the Congress, the Coast Guard, and the
administration to authorize and fund our Nation's future
strategic icebreaking needs.
While it is true the U.S. shipyard industry has not
designed and constructed a heavy icebreaker in the past 40
years since delivering the Polar Star in 1976 and the Polar Sea
in 1978, we have delivered several other icebreakers during
this period. The medium polar icebreaker Healy was put into
service in 2000, and is actually larger than the Polar Star and
the Polar Sea. The Nathaniel B. Palmer, a smaller icebreaker
specifically built for conducting scientific research for the
National Science Foundation, was delivered in 1992. For
icebreaking operations on the Great Lakes, the Mackinaw was
delivered to the Coast Guard in 2005. In addition, the
commercial icebreaking supply vessel, the Aiviq, was delivered
in 2012.
These icebreakers were built in U.S. shipyards in the
Pacific Northwest, along the gulf coast, and on the Great
Lakes. I can tell you today there is strong interest in
icebreaker construction from at least 10 shipyards located
around the Nation, from the Northeast to California to the
Northwest and again along the gulf coast and the Great Lakes
region. This level of interest across the U.S. shipyard
industrial base will ensure a robust level of competition for
this project, which is certainly good for the Coast Guard and
for the Nation.
The same is true amongst the supplier base for the
shipyards. The 94 industry partners of the SCA have the
capabilities, equipment, and technology available to support
the building of polar icebreakers. There are multiple design
solutions available that will create a competitive environment
for all potential suppliers as they support the shipyards.
U.S. shipyards pride themselves on implementing state-of-
the-art training and apprenticeship programs to develop skilled
craftsmen and women that can build truly first-of-a-kind
commercial vessels and the best Navy and Coast Guard in the
world.
For instance, the steel requirements for a heavy icebreaker
rated at Polar Code 1, the highest icebreaking requirement, is
a steel thickness in the 50 millimeter range. Presently, U.S.
shipyards building for the commercial container ship market
handle, cut, weld, and form steels for ships that are at the 65
millimeter range, and of a similar grade to the Polar Code
requirement. In addition, many of our shipyards work in heavy
steel construction beyond ships, building structures for
nuclear power plants that are 3 to 4 inches thick.
These are just a few examples of the critical skills that
would be needed to build a polar icebreaker where our industry
has recent and relevant experience.
As a final recommendation to the committee, to build these
ships in a timely and affordable manner there must be precise
and fixed Coast Guard validated requirements. There is language
in the House 2017 defense authorization bill requiring the
Coast Guard provide Congress and industry with validated
operational requirements in the near term, and we believe this
is a step in the right direction.
If there are validated and stable requirements in place,
the time to construct a polar icebreaker, from the start of
concept design to construction and then to delivery, would be
roughly 7\1/2\ years.
Again, I would like to thank the subcommittee for inviting
me to testify alongside such distinguished witnesses. As a
representative of our Nation's private shipyards I can say with
confidence and certainty that our domestic shipyards and
skilled workers are ready to build the next generation of Coast
Guard polar icebreakers. Thank you.
Mr. Hunter. Thank you all. I was actually going to yield to
Mr. Zeldin, instead of--because it is very rare that we have
people here at all in this committee.
[Laughter.]
Mr. Hunter. But with that, I am going to yield to Mr.
Graves. I will ask questions afterwards.
Mr. Graves of Louisiana. Thank you, Mr. Chairman, I
appreciate that. Thank you all for being here today. This topic
has certainly been a very hot one lately.
I am curious. Admiral Michel, could you possibly--and if
others want to step in on this--could you possibly describe and
compare and contrast the icebreaking capabilities of the United
States, compared to other Arctic nations?
Admiral Michel. Yes, sir. They vary in capability. So, for
example, at the high end you have the Russian icebreaking
capability, which is substantial. I mean they have just
launched a sixth nuclear icebreaker, the most powerful
icebreakers on earth. They have got the most powerful diesel
electric icebreaker that will ever be in service under
construction right now. They have about 40 of those Polar class
vessels, all the way from light all the way to very heavy.
Mr. Graves of Louisiana. Are United States capabilities in
the same league?
Admiral Michel. Sir, we have--for the United States
capability we have the Healy, which is a medium icebreaker
commissioned in 2000, and we have the Polar Star, which is a
heavy icebreaker, the world's most powerful non-nuclear
icebreaker. Ship is approximately 40 years old. And then we
have the Polar Sea, which is not currently operational----
Mr. Graves of Louisiana. So is that a yes or a no? Do you
consider us to be in the same league, anywhere in the same
league?
Admiral Michel. Well, clearly not, sir, in Russian
capability. We do match better with some of the smaller Arctic
nations who do have single or just a few vessels. Even Canada
has more capability than the United States currently has.
Mr. Graves of Louisiana. Thank you. Ms. Stiller, do you see
icebreaking as being primarily a Coast Guard mission?
Ms. Stiller. Yes, sir. In fact, 14 U.S.C. 2 specifies
icebreaking as one of the Coast Guard's missions, especially in
national defense. And there was also a memorandum of agreement
between the Department of the Navy and the Department of
Treasury back in the mid-sixties, which has not been amended
since, but also assigns Coast Guard with icebreaking capability
during peace time, war time, and contingency operations.
Mr. Graves of Louisiana. Mr. O'Rourke, do you see our
capabilities as being sufficient? Do you think that we are on
the proper trajectory in terms of changes in the Arctic and our
capabilities?
Mr. O'Rourke. I can't tell you whether our current
trajectory is appropriate or not. That would call for making a
recommendation, and I can't do that as a CRS analyst. What I
can point out is what other people----
Mr. Graves of Louisiana. Your secret is safe here.
[Laughter.]
Mr. O'Rourke. What I can point out is that the Department
of Homeland Security has a mission need statement that sets
forth a need, potentially, for up to three heavy and three
medium polar icebreakers. That is their statement of their own
requirement that is on the books and against which Congress can
measure the executive branch's activities.
Mr. Graves of Louisiana. And Ms. Grover, do you see the
current--when looking at the capabilities right now, Polar Sea,
Polar Star, the status of those vessels, and you look at the
status of the Healy, all of which are going to have to go
through, in some cases, full-fledged refurbishment, do you--in
your testimony I think you described mission gaps in there. Do
you see any solution that is being proffered at this point to
address the gaps when we simply don't have Arctic capabilities
at all?
Ms. Grover. No, sir. I don't believe there is any set plan
for addressing the gaps just yet, although the Coast Guard is
working on it.
Mr. Graves of Louisiana. Do you view that as being a
national security threat, not having capabilities?
Ms. Grover. That is certainly not my decision to make. I
understand that there are--that the Coast Guard has a set of
missions for which they are required to be able to carry out in
the Arctic, as in the rest of the U.S., and those include
defense readiness, search and rescue, issues related to
sovereign presence. And it seems like it could be difficult
under some circumstances for them to carry those out.
Mr. Graves of Louisiana. Ms. Conley, did you care to
comment on the disparity and capabilities in the Arctic of the
United States compared to other countries?
Ms. Conley. Yes, sir. It is difficult. The Russian Arctic
is a completely different space than the American Arctic. The
Russian Arctic is over 50 percent of the total Arctic
coastline. Over 22 percent of Russian GDP and exports come from
the Russian Arctic. That is why they have such extensive
icebreaking capabilities. It is a vital commercial and economic
space for them, and they have very ambitious plans to develop
it.
I think, for the U.S., we have to be mindful--this is about
U.S. national security. It is not in comparison to keeping up
with Russian 40 icebreakers. We need to have capabilities to
serve the American people, to protect the United States, to
search and rescue, and oil spill response. And today we don't
have the capabilities that we need to effectively do that. It
is a strategic vulnerability that has been in existence for
several years. I am so delighted we are waking up to this.
But unfortunately, the procurement plans are long, and we
are going to have this gap with us for several years.
Mr. Graves of Louisiana. Sure. Last question, Mr. Chairman.
Mr. Paxton, when you worked in the Senate, the most
effective and capable staff director you worked with was who?
And, remember, you are under oath.
Mr. Paxton. Well, I worked for several very distinguished
members of that committee.
Mr. Graves of Louisiana. There is only one right answer to
that question.
[Laughter.]
Mr. Graves of Louisiana. I yield back, Mr. Chairman.
Mr. Hunter. I thank the gentleman. The ranking member, Mr.
Garamendi, is recognized.
Mr. Garamendi. I want to get a couple things off the table.
We have been going round and round here, just plowing the same
field over and over again. So let's get a couple of things off
the table.
First of all, the lease option. Ms. Grover, you said that
it is not feasible, it is overly expensive, and not available.
Please expand on that.
And then, Admiral Michel, if you will deal with this. Is it
viable? Is it not viable? Yes? No? Let's dispose of this issue.
Ms. Grover. So, technically, it is feasible. The Coast
Guard is required to use public vessels for some of their
missions. And so, that means either they have to outright own
the vessel, or they can operate it under a demise----
Mr. Garamendi. I understand that.
Ms. Grover [continuing]. Lease, right? OK. So then the
question is can they do that more cheaply than buying it
outright. And generally speaking, I would expect that purchase
would be less expensive, because when you figure in the profit
for the ship owner, and the higher borrowing class for the
private sector than the Federal Government.
Mr. Garamendi. So your answer is leasing is more expensive.
Ms. Grover. So leasing is generally----
Mr. Garamendi. Is there a lease--is there a ship available
in the near term--that is in the next 3 years--available for
leasing?
Ms. Grover. The Coast Guard believes there is not. And I
don't have any reason to believe differently.
Mr. Garamendi. OK. Admiral Michel?
Admiral Michel. Well, sir, as far as heavy icebreaking
capability, there is no vessel available for lease to provide
heavy icebreaking capability. There are vessels on the global
market that have the characteristics of a medium icebreaker,
but the Coast Guard has not yet found one of those vessels that
is suitable for military service without substantial refitting.
Mr. Garamendi. So the answer is leasing doesn't make any
sense. Is that correct?
Admiral Michel. Not in the current scheme of things, sir.
Mr. Garamendi. Grover, is that correct?
Ms. Grover. Generally speaking, purchase is the----
Mr. Garamendi. Are any of the----
Ms. Grover [continuing]. Way to go.
Mr. Garamendi [continuing]. Witnesses disagreeing with that
assessment, that leasing is not an acceptable option? All
right. Enough of leasing.
Now, we have a gap. How can that gap be filled? Admiral?
Admiral Michel. Well, sir, the current plan is on the heavy
side, is to either reactive the Polar Sea----
Mr. Garamendi. OK. July 24 you are going to give us an
assessment of whether that is viable or not.
Admiral Michel. We are, sir. And I will flag to you that
having talked with my folks who took a look at that vessel,
that is going to be a substantial endeavor, much harder to do
than the Polar Star for a number of different reasons. And we
never really fully appreciated that until we had the vessel out
of the water, as you know, which became available----
Mr. Garamendi. OK, so----
Admiral Michel [continuing]. Because of Congress'
appropriation. Then we are going to have to take a look at
the--a rolling recapitalization of the Polar Star is
essentially what the other alternative is until we can bridge
out. We are also going to figure out Healy, which is going to
have to be synched up with that, and we have got some ideas on
how we are going to SLEP Healy and do that in segments, so that
we can keep that vessel online to the maximum extent possible.
Mr. Garamendi. So you really have no plan to deal with the
gap?
Admiral Michel. Sir, the Coast Guard's requirements set
forth in the High Latitude Study are for three heavies and
three medium icebreakers. Currently----
Mr. Garamendi. So that is your 3x3 strategy.
Admiral Michel. That is what is required to meet Coast
Guard missions, or fulfill Coast Guard missions, is three
heavies and three mediums. Our----
Mr. Garamendi. OK. So, really----
Admiral Michel. And I have described to you essentially
what our plan is, including the need for the construction of
the new heavy polar icebreaker. That is integral, because we
are only going to be able to keep the Polar Sea and Polar Star
under any circumstances online for just enough to reach out to
that new breaker, sir.
Mr. Garamendi. So I just heard you say one is not enough.
We are going to need at least two heavy icebreakers to fulfill
the mission as----
Admiral Michel. The Commandant has testified that we need
at least two----
Mr. Garamendi. OK.
Admiral Michel [continuing]. Heavy polar icebreakers for
self-rescue capabilities. And the President's statement----
Mr. Garamendi. That then takes us to the block buy, doesn't
it?
Admiral Michel. Sir, that is actually one of the things
that--and we are going to work with the Navy on that, and
employ some of their expertise, as to whether that makes sense.
That is going to require congressional action, because we do
not have authority to do that.
We are also going to have to take a look at that arrayed
against the budget requests and the actions of the Congress.
The President----
Mr. Garamendi. Yes, I don't want to play ping pong back and
forth between the Coast Guard and Congress. You are quite
correct; we are going to have to make a decision. Are we going
to commit the United States and our budget and appropriations
to address the real need in the Arctic?
Now, icebreakers are but one. In 19 seconds I am going to
raise the other four issues. Communications, we have not talked
about communications much, but it is not worthwhile to have a
ship up there that you can't communicate with. Domain
awareness, we haven't talked about that, but that is another
issue. Infrastructure, which has been discussed. Army Corps of
Engineers, where are you with a deepwater plan? Have you even
thought about it? If so, where and where, and how much?
Icebreaking, we have gone round that enough times to circle the
earth several times. And finally, your training program. These
are the five critical issues that have to be addressed if, in
fact, we are going to have any activity and any American
presence in the Arctic.
Icebreaking, Admiral, we need very specific information
from you and we need it right away, because we are going to
have to pass a law here and the appropriations, or at least the
budget, to go with it.
Communications, not spent time on that. We need that
information. What kind of communication equipment? What kind of
appropriations and monies necessary for the appropriate
communications? Domain awareness, probably pretty much the same
issue.
OK, you know what I need. Admiral, when are you going to
deliver it?
[The information from Admiral Michel of the U.S. Coast
Guard follows:]

As noted in GAO's report on the implementation of the Coast
Guard Arctic Strategy, some of the gaps identified concerning
communications, domain awareness, infrastructure, icebreaking,
and training are complex, and efforts to address them will
extend beyond the timeline of the 10-year Coast Guard Arctic
Strategy or Implementation Plan. Additionally, it is important
to note the Coast Guard is not solely responsible for
mitigating all of the capabilities in which gaps were
identified. The Arctic Executive Steering Committee (AESC), led
by The Executive Office of the President, was created to
enhance interagency coordination in order to meet the nation's
strategic objectives in the Arctic. The National Strategy for
the Arctic Region (NSAR) and its associated Implementation
Framework, recently updated in March of 2016, identify lead
components and specific administration priorities.

``The Progress Report on the Implementation of the National
Strategy for the Arctic Region'' (March 2016) details the
status of U.S. efforts in the Arctic, outlining the advancement
of the NSAR through programs overseen by specified Federal
entities. All relevant NSAR documents can be found at the
following webpage: https://www.whitehouse.gov/blog/2016/03/09/
advancing-implementation-national-strategy-arctic-region. In
addition to these documents, I'd like to share some highlights
of Coast Guard contributions to the implementation of the NSAR.

Maintaining communications capabilities in the Arctic is a
challenge the Coast Guard continues to address. The seasonal
deployment of our assets to the region during Operation Arctic
Shield has allowed the Service to test capabilities and tailor
operations in the region to adapt to these challenges. We
currently use offshore cutter-based command and control
platforms, shore-based mobile command and control platforms,
and seasonal air and communications capabilities together to
address the unique challenges associated with operating in the
Arctic.

As to maritime domain awareness in the Arctic, we have embraced
a seasonal and mobile approach. This method counters the
unpredictability of human activity by allowing us to
concentrate our assets in the area they are most needed at any
given time.

The Coast Guard has also actively engaged other Federal, State,
local, tribal, international, and private stakeholders to
enhance domain awareness in the Arctic through cooperative
effort and info sharing. We recently conducted maritime domain
awareness flights along the North Slope and over the Arctic
Ocean to monitor maritime activity, assess response asset
performance, and observe environmental conditions. We have also
updated carriage requirements for the Automatic Identification
System (AIS), extending applicability to all U.S. navigable
waters, including the Arctic, enhancing our ability to identify
and track vessels.

This seasonal and mobile approach has been effective in
removing the need to construct, maintain, and staff permanent
infrastructure in arduous and often remote areas. Operation
Arctic Shield, featuring various combinations of integrated
force packages operating in northern Alaska, takes place
between July and September and involves a mixture of Coast
Guard cutters equipped with flight decks, sea-going buoy
tenders, aircraft, and shore forces. The upcoming Operation
Arctic Shield 2016 (AS16) will include prepositioning assets at
Kotzebue, Alaska, to increase our cutter and aviation presence
in the region.

With respect to icebreaking, assured access to the Polar
Regions is required to preserve our broad and evolving national
interests. Providing this capability into the future
necessitates recapitalization of our polar icebreaker fleet.
Thanks to the support we have received from Congress, we are
working to accelerate the acquisition of the first new heavy
icebreaker, and we have begun planning for additional assets.
The President's Budget for FY 2017 included $150M in support of
this program to fund critical activities through the detail
design stage. In March 2016, the Coast Guard held an Industry
Day with over 90 organizations participating, followed by 48
one-on-one meetings with interested vendors. A robust industry
engagement strategy, as well as a collaborative partnership
with the U.S. Navy, are essential elements of the acquisition
strategy.

Until new assets are delivered, the Coast Guard is committed to
providing continued icebreaking capability. As part of settling
on the formal bridging strategy, a Materiel Condition
Assessment was recently completed on CGC POLAR SEA to
thoroughly assess the condition of the vessel. This effort
revealed the extent of the technical challenges that would be
associated with any reactivation, and provided data to inform a
follow-on Alternatives Analysis. The objective of this analysis
is to compare a potential POLAR SEA reactivation to a POLAR
STAR service life extension to determine the most prudent way
ahead. The report will outline the bridging strategy to
maintain heavy icebreaking capability while the Coast Guard
proceeds with the acquisition. Preliminary steps to prepare for
a Midlife Maintenance Availability on HEALY are also underway,
including investigating the feasibility of segmented midlife
maintenance projects to mitigate impacts to operations.

Improving our capabilities in the Arctic is a priority, and
providing our Coast Guard men and women with the training and
experience necessary to perform at their best in any
environment is a key component of this. In addition to the
yearly Operation Arctic Shield, exercises such as Arctic
Chinook allow operators to practice techniques in Arctic
environments. Arctic Chinook is a joint USCG and USNORTHCOM
sponsored exercise. It is a live field training exercise (FTX)
of the Arctic SAR Agreement that will exercise a response
construct applicable across the Arctic region. International
participation and an international observer program are
providing the opportunity for cross-training and cooperation,
as well as expanding the network of Arctic operators.

We have also created the Center for Arctic Study and Policy
(CASP) as an academic center for Arctic maritime operations.
The CASP builds a nexus between operators, academics,
indigenous community members, and policymakers on evolving
Arctic issues.

Admiral Michel. Well, sir, the icebreaker is a critical
part of that, because that is a mobile----
Mr. Garamendi. No, no. No more on the icebreaker.
Admiral Michel. Well----
Mr. Garamendi. We have gone around that game too many
times.
Admiral Michel. Sir--well, I think you are missing the
point here, sir. That type of a mobile platform can actually
help you with providing a communications suite that is mobile.
It can also provide maritime domain awareness with its sensor
packages. That is the beauty of buying a mobile platform, sir,
rather than fixed infrastructures. You can move that to
wherever you need to. And having a capable icebreaker----
Mr. Garamendi. Point well taken. Thank you.
Admiral Michel [continuing]. Get that capability anywhere,
sir.
Mr. Garamendi. Beyond the mobile, do we need fixed? And if
so, what?
Admiral Michel. Right now the Coast Guard strategy is
mobile and seasonal, because the human activity up there is
very dynamic.
Mr. Garamendi. Stiller, Ms. Stiller, is that in the Naval
strategy, to depend upon the Coast Guard?
Ms. Stiller. Sir, I am an acquisition professional, but I
will be happy to take that back and get you an answer from the
operations side.
Mr. Garamendi. Please do, thank you.
Ms. Stiller. Yes, sir.
[The information from Ms. Stiller of the U.S. Navy
follows:]

In alignment with the ``National Maritime Domain Awareness
Plan'' (which promotes global maritime security through
improved understanding of the full spectrum of activity in the
maritime domain), the Navy works with international allies and
interagency partners, including the Coast Guard, sharing
limited resources, to improve maritime domain awareness of the
Arctic Ocean.

The Navy and Coast Guard leverage each other's capabilities in
the Arctic. The Navy utilizes a myriad of National, Department
of Defense and Coast Guard platforms--in space, sea, air, and
on land--for Arctic communications. Coast Guard platforms, in
particular, provide mobile, seasonal communication capabilities
in the Arctic. The Navy will continue to deepen its operational
relationship with the Coast Guard to support our shared
interests in the Arctic, which include increasing commonality
and interoperability, improving information sharing,
emphasizing the use of common data standards, and fostering
international and interagency partnerships.

The Navy and Coast Guard will continue to cooperate to be
better prepared to jointly provide for homeland security and/or
homeland defense when operating in the Arctic. The Navy will
continually assess our preparedness in response to changes in
the Arctic environment or changes in the security environment.

Mr. Garamendi. And for Mr. O'Rourke and Ms. Grover, thank
you for your analysis. It is very helpful. I would like to have
your analysis on the communication and the domain awareness,
also.
I am well over my time, Mr. Chairman. Thank you.
Mr. Hunter. I thank the ranking member.
I guess, Ms. Conley, one quick question. They said that in
the 1960s the Treasury and the Coast Guard made an agreement
that this is a Coast Guard mission. Is this a Coast Guard
mission?
Ms. Conley. It is a whole-of-government mission. The Coast
Guard has a clear leadership role in providing the capabilities
needed, but I believe that Arctic security encompasses a much
wider lens that includes assets from the Department of Defense,
in addition to the Department of Homeland Security. It is a
full package. We just haven't yet focused on the wider defense-
related issues yet.
Mr. Hunter. I would ask the whole panel. Why is this not a
Navy mission? Why is it not a Naval mission? Besides that
somebody said it is not 60 years ago, besides that answer.
Admiral Michel. Well, sir, the Navy and the Coast Guard
came to an agreement that the Coast Guard would be the
executive agency to provide----
Mr. Hunter. Besides them coming to--besides that, tell me
why. What is the reason it is not a Naval mission? Because you
said----
Admiral Michel. I----
Mr. Hunter. Wait, let me finish, Admiral. You said you
can't lease a ship because they are not--there is no readily
available militarily capable vessels. So what you are saying is
there is no other--there is no military icebreakers to military
specs like a destroyer that are available right now. I think we
understand that. If we had those available in the U.S., they
would be yours, and we would be using them.
There are icebreakers that can be used that aren't to
military spec, but I would ask you--but besides somebody coming
to an agreement prior to today, why is it not a Naval mission?
Admiral Michel. Well, just to be clear, sir, I didn't say
that it was or wasn't a Naval mission. I said that it was a
Coast Guard mission, and that we took responsibility that, in
the 1960s, and as statutorily----
Mr. Hunter. And look where we are.
Admiral Michel [continuing]. A Coast Guard mission----
Mr. Hunter. And look where we are. So my question is,
should this be a Naval mission?
Mr. O'Rourke?
Mr. O'Rourke. It was a Navy mission shared with the Coast
Guard for a period of about 20 years from the end of World War
II until the handover in the mid-sixties, when it reverted to
being a Coast Guard-only mission.
The history that I have read on that situation is that it
was consolidated with the Coast Guard in the 1965-1966 period
because the Navy at that time was facing a large modernization
requirement to replace the many, many ships built during World
War II that were, at that point, aging out in very large
numbers, and that with a concern for their ability to replace
all those ships and essentially rebuild the fleet, it was that
concern, according to this history, that drove the transfer
over.
As a matter of policy, Congress and the executive branch
can agree that it can be a Navy mission, as well as a Coast
Guard mission. But the history that I read suggests that it was
the Navy's modernization needs which were coincident with the
Vietnam War that drove the decision in the mid-1960s.
Mr. Hunter. Got you. So let's talk about with the Navy
involved in this, given the $1 billion that has been
appropriated--hasn't been passed yet, but the Senate has
appropriated it--given the concerns we all have articulated
regarding the timelines, let me ask you this. Could the $1
billion be used better if the Navy takes the lead in the
acquisition, or the Coast Guard?
Can--given where they are, in terms of their professional
acquisition systems and people and history of making ships? Put
it--make it more simple. Who is best suited, the Coast Guard or
the Navy, to acquire and build and set up the analysis and the
parameters, the requirements, for an icebreaker?
Mr. O'Rourke. If that question is to me, what I would say
is that the Navy's expertise in shipbuilding and the Navy's
expertise in executing block buy contracts could help the Coast
Guard in an acquisition of two polar icebreakers that were to
be done under a block buy arrangement.
That is not to say that the Navy is better than the Coast
Guard, but the Navy does have expertise, especially in
executing block buys that the Coast Guard has not done
previously, so that if you were to take that expertise and
leverage it in a whole-of-government fashion, it may allow the
Coast Guard to do that acquisition better than if the Coast
Guard were attempting to do it on its own for the first time.
Mr. Hunter. Admiral, if you had--I don't know how to phrase
this.
Mr. Garamendi. Does he agree?
Mr. Hunter. Would you rather--yes, I mean, that is a good
question. Do you agree with Mr. O'Rourke's assessment?
Admiral Michel. I think under any circumstances, sir, we
are going to tap into the expertise of our Navy colleagues.
Mr. Hunter. That is the new joint program office that we
are setting up.
Admiral Michel. We already committed to that, sir, and that
benefits both our agencies.
Mr. Hunter. When it comes to the $1 billion, how--tell me
how the Coast Guard views getting one vessel and saying that is
$1 billion for one vessel, or what Mr. O'Rourke testified to
earlier, that if you take the $1 billion, you could save a
couple hundred million dollars, possibly, say $200 million,
build two, buy all the lead-time materials, could get all the
blueprints and the requirements done, and then come back to
Congress and say, ``OK, we are ready to roll and build two of
these,'' and save a few hundred million dollars in the
meantime?
Admiral Michel. Sir, I am only authorized the support the
President's budget request, and that is $150 million,
approximately----
Mr. Hunter. But the Homeland Security----
Admiral Michel [continuing]. For the construction of a
heavy polar icebreaker----
Mr. Hunter. The Homeland Security analysis says three
heavies and three mediums. You are not breaking any rules by
saying you would like to build two at the same time, are you?
Admiral Michel. Sir, I am open to any discussions. The only
thing I can officially support is the construction of a single
heavy icebreaker. I am happy to work with the Congress and
other stakeholders on what makes sense. I am not trying to do
something stupid here. But the only thing that our budget
request supports is the construction of a single heavy polar
icebreaker.
Mr. Hunter. What are we--what did Homeland Security come
out with their analysis that says that they need three heavies
and three mediums? What are we referring to there?
Admiral Michel. Sir, that is our outstanding requirement.
The High Latitude Study says that, in order to fulfill Coast
Guard mission, the Coast Guard requires three heavy icebreakers
and three medium icebreakers. The President's budget request
begins the recapitalization of that fleet. Our Commandant has
testified we need at least two heavy icebreakers in order to
provide self-rescue capability. And I would like to see a
third, but that is going to have to be supported by future
budget requests.
The acquisition of those, I am sort of open to any
suggestion, and I can sort of support on what makes sense for
the acquisition of those very expensive assets----
Mr. Hunter. But if you are only allowed to talk about
building one, then how can you get into it with the Navy on
what a block buy and lead-time materials would do for you,
then? Are you authorized to even discuss that?
Admiral Michel. Well, sir, we have got an ongoing dialogue.
I mean you and I are talking about this right----
Mr. Hunter. Well, I just asked you about it, and you said
you can only talk about one.
Admiral Michel. I didn't say, sir, I could only talk about
one. I said the only one I can officially support is the
construction of a single heavy icebreaker, because that is what
the President's budget request is. I am open to discussing any
type of acquisition strategy that makes sense. I sit in a
pretty high position in the Coast Guard and in the Government,
and I talk to people all the time. And people are interested in
doing good things. So I would like to keep the dialogue open.
The only thing I can officially support right now is the
construction of a single heavy icebreaker, because that is the
President's budget request.
Ms. Stiller. Sir, I would also point out that the SAC
[Senate Appropriations Committee] add to the Department of the
Navy is for a single vessel. So any authorities that, as we
work together, we deem that we would need otherwise, we would
be required to come back and request a legislative proposal
through the system to ask for authorities like block buy. That
is how we have typically done that in the Navy, as well, to
bring forth the business case, per se, to present that to the
committees to consider.
Mr. Hunter. So tell me explicitly. What action would you
need Congress to take, either the House or the Senate, to be
able to do a block buy?
Ms. Stiller. We typically get block buy authority from our
authorizers that says that we can enter into block buy
authority for a particular class of ship, or a number of ships.
Mr. Hunter. That would be in the--that is in the
authorizing committee, so that would be the NDAA?
Ms. Stiller. Typically, sir, that is how we get it. I will
defer to the Admiral on how the Coast Guard would get their
authorities. But yes, sir.
Mr. O'Rourke. It has happened both in authorization bills
and in appropriation bills. It can be as little as a single
sentence.
Mr. Hunter. So this could be done in conference,
theoretically, on the----
Mr. O'Rourke. Congress must approve each instance of a
block buy.
Mr. Hunter. But I----
Mr. O'Rourke. And Congress has done so in both
authorization and appropriation bills.
Mr. Hunter. On the NDAA conference, could the language be
changed to allow this $1 billion to go towards a block buy?
Mr. O'Rourke. Yes, it could be done in the NDAA conference,
it could be in the conference on the DOD approps bill. And it
is not complicated. The block buy authority for the Littoral
Combat Ship was a single sentence in an appropriations bill
that was actually a continuing resolution that bridged our
funding for a few weeks.
Mr. Hunter. Does it----
Mr. O'Rourke. It is not----
Mr. Hunter. Does it lock them into it, or does it give them
the option?
Mr. O'Rourke. Typically, what the language says is that the
department in question, or the secretary of that department,
shall have the authority to contract for some multiple numbers
of ships. It is a single--it can be as simple as a single
sentence, and that tends to be what it has been in the
instances where we have had it.
Mr. Hunter. OK. Then taking that, Admiral, what does that
do to your Presidential authorization request for just one?
What if that gets done--let's say that that sentence is put
into the NDAA in conference, and it is passed in December,
and--what then, concerning what the President's request allows
you to talk about?
Admiral Michel. Well, sir, the Congress can choose to do
what the Congress and its will chooses to do. If it chooses to
buy multiple ships or appropriate different amounts of money,
the Congress can do that. I am only authorized to support the
President's budget request, which is $150 million for a single
icebreaker.
If Congress chooses to give the Coast Guard or the
administration additional authority, or chooses to appropriate
any number of vessels or types of vessels, the Congress is a
co-extensive branch of Government, and the Congress can do that
in its will through enacted law.
Ms. Stiller. Mr. Chairman, if I could just make one comment
to Ron's statement.
Mr. Hunter. Yes, ma'am.
Ms. Stiller. Typically, when we get block buy authority, it
is tied to the advance procurement line within the SCN
[Shipbuilding and Conversion, Navy] budget. It is not tied to
the full funding part of the budget. And right now, the way it
is in the SAC mark, it is in the full funding line. So there
would have to be some sort of discussion to address that. That
is my only point.
But we do--when we get it, we get the authority to use it
if it makes sense.
Mr. Hunter. Thank you.
Ms. Hahn, you are recognized.
Ms. Hahn. Thank you, Mr. Chairman. I would like to change
the subject just slightly. I have learned that this fall
Crystal Cruises is going to be taking passengers on an
unprecedented cruise through the Northwest Passage. This ship
will be accompanied by an escort icebreaker and a dozen
expedition experts.
So, Admiral Michel, I was going to just ask you to what
extent has the cruise line worked with the Coast Guard to
ensure the success of this voyage. And we do know that the
Arctic Circle can be known to be a dangerous region, due to the
unpredictability of the ice and the sea. What contingency plans
have been established, in the event of an emergency, to make
sure that these passengers are safe?
Admiral Michel. Yes, ma'am. Well, we have been working with
Crystal Cruise Lines here for a couple years on this. And I
think Crystal understands the challenges associated with this
venture, which actually, I think, is going to occur next month,
in August. And we have not only been working with them, but
also with the Canadian Coast Guard, with the Department of
Defense, with local officials, and have mapped that out, that
particular voyage, most of which, actually, is in Canadian
waters. I think 85 percent of it or more is actually in
Canadian waters. And the most treacherous parts are actually in
Canadian waters. But we have bridged out and reached out to
them.
We did a table-top exercise the last couple months, and
worked through all the issues on there on how you would get
people out of there, how you would take care of the life boats,
how you would utilize that very small--it is an icebreaker, but
it has become also an ice management vessel, is the way that
they are going to use it.
But Crystal Cruise Lines is--for example, they are taking
on board ice pilots, they are getting the latest on the ice
situation that is up there. We think they have done pretty good
homework. But I don't want to underestimate the challenges of
that area. There is almost no logistics up there.
For example, if we needed to get another helicopter up
there--they are only bringing very small helicopter with them.
If they needed to get a big helicopter up there, it is
estimated to take between 15 and 20 hours, if the weather is
good, in order to get that up there. Fixed-wing aviation may be
available, but even there you have got very limited landing
areas, very environmentally sensitive areas. Things change up
there dramatically. Even during the summer the weather is an
incredible challenge.
So, this is not an easy category for a voyage. But I think
we have done all the legwork that we can upfront here, and we
do have a responsible operator in Crystal, who is taking a
number of additional steps in order to ensure that they have
got a safe passage.
Ms. Hahn. Thank you. Well, I represent the Port of Los
Angeles. And between Los Angeles and Long Beach, clearly we are
the busiest cruise ship terminals. And that is a huge part of
our economy, and tourism in the area. So, you know, we have
heard of late of some tragic circumstances aboard cruise ships,
even in calm and warm waters, so this certainly is of concern.
Ms. Conley, I was going to ask you, just in your studies,
and what you are predicting, what does the future hold for
tourism in the Arctic? Is--I would love to hear your thoughts
on that.
Ms. Conley. Thank you. Well, we definitely see an
increasing interest. In some ways, because the Arctic
environment is changing so quickly, it is sort of creating a
rush, if you will, to see this pristine environment while it is
still in its current state.
In conversations and in conferences that we have held at
CSIS, where we have invited the cruise industry, they haven't
necessarily seen a huge uptick. And in fact, I think the
Crystal Serenity is a real trail blazer. And you know, as you
have been noticing, the extensive media attention on that
cruise itself, in addition to our Coast Guard colleagues that
will be following it very closely, this may actually spur a
great deal of interest.
The price tag is enormous per passenger, because of the
extra safety requirements that are needed. For instance, the
Russian tourism industry has been using their Russian
icebreakers to take cruises up to the poles, literally, for
quite some time. It is for that adventure ecotourism. So we are
not seeing the numbers yet. It will be interesting to see if
the Crystal Serenity does, in fact, show a real uptick in
interest in cruising the Arctic.
Ms. Hahn. And Admiral, how much time and effort and
resources does our Coast Guard expend for this specific cruise
breakthrough of the Crystal Serenity?
Admiral Michel. Well, quite a lot, ma'am. This is the
largest cruise ship that is ever going to go through this area.
And, by magnitudes, the largest number of people are going to
go through this area. So we have been working extremely
closely, like I said, not only with the cruise lines, but
everybody else who has an oar in the water here, on ensuring
that we have got a safe voyage.
So this has taken a lot of our time, and we take this very
seriously. And I hope we always will, because that is a very
treacherous area of the earth----
Ms. Hahn. And do we get compensated for that?
Admiral Michel. Ma'am, we don't charge people for those
type of services. Those are Coast Guard responsibilities. The
taxpayers----
Ms. Hahn. Because it is interesting----
Admiral Michel [continuing]. Foot the bill for the Coast
Guard.
Ms. Hahn [continuing]. As Ms. Conley pointed out, the
passengers are paying--sounds like they are paying extra for
extra security and some of the resources that you are so
generously giving away.
Admiral Michel. I don't think we are--well, giving away----
Ms. Hahn. I mean, that is our----
Admiral Michel. This is what we do----
Ms. Hahn. I mean, that is our core----
Admiral Michel [continuing]. In the Coast Guard.
Ms. Hahn. Your core mission is, of course, to keep----
Admiral Michel. Yes, ma'am.
Ms. Hahn [continuing]. People safe on the high seas. But it
is kind of an interesting world we are getting into. And as we
always talk here, your resources are always limited, we are
always trying to make priority choices. Sort of like contract
sheriffs, you know, they charge other cities for their
services. It would be interesting to look at that model some
day.
Admiral Michel. Yes, ma'am. And we would like to invest the
resources upfront to prevent an accident from happening,
because if you actually have an accident and respond to it, it
is a lot worse situation. So I would rather make the investment
upfront with the cruise lines, see if we can buy as much risk
down as possible.
Ms. Hahn. Thank you very much. We hope it is successful.
I yield back.
Mr. Hunter. I thank the gentlelady. I now yield to the
former chairman of this committee, whose giant portrait is
right behind everybody, Mr. Young.
Mr. Young. Thank you, Mr. Chairman, and I do appreciate the
comment. A giant portrait. It is a giant Member, I just want
you to know that.
So, Mr. Chairman, I was listening to the questions. And my
concern to the panel is this is not new. And I don't see much
progress. That probably concerns me the most. And it is sort of
like, you know, we are just spinning our wheels. We are worried
about tourism now, and we are going to take and--break the ice
for tourism, and that is well and good. But what about the
security aspect of it?
This administration, very frankly, is focused on the human
and environmental dimension of the Arctic, and not on the
security. And yet I see Russia every day growing with the
established--I would call it headquarters. There are six new
battalions in the Arctic, there is about seven new ports. This
has gone on, and we are just sort of, oh well, it will happen
some day.
Is there anybody really thinking about the effect--I know
Finland and, I believe, the other countries close by have
become more aware of potential--not only a threat, but taking
over the resources. Has there been any discussion amongst any
of you about this problem?
Ms. Conley?
Ms. Conley. Yes, sir, thank you. We actually concluded a
pretty significant study that examined the Russian Arctic,
looking at their economic interest, the changes to their
security posture, and we concluded that, in fact, over the last
several years there have been significant shifts in Russia's
posture.
Now, you can explain that in different ways. Because Russia
has a very ambitious economic vision for the Russian Arctic,
they believe that the northern sea route will become some day a
viable major transit route, and there is a lot of people that
are quite skeptical about that. So they were putting in place
very ambitious projects. They have very ambitious energy
projects with the Yamal LNG project.
But clearly, over the last several years, they are
developing using their military industrial complex. So when
they announced previously that they would create 10 search and
rescue centers across the Russian Arctic, that is a positive
thing. We need more infrastructure. But then it was announced
later that those--in fact, those 10 centers will have dual use.
They will be both operated by the military and civilian forces.
They have restructured their command. They have told us
that they will have 50 new airfields in the Russian Arctic by
2020. They are placing--now these are small units, but they are
capable units. And so you are scratching your head, going,
well, this is a lot of change. We are not--no one else is
repositioning itself; why are they doing this? And I think they
are preparing to project their sovereignty, and concentrating
on both projecting that sovereignty in the North Pacific and
the North Atlantic.
The question for the United States is we have to evaluate
this change and see if we must adjust our posture, enhance our
security measures. As I mentioned in my testimony, other States
have begun to make that shift. It is not big, it is not bold,
but they are making those shifts. The U.S. has been studying
the matter. The Senate Armed Services Committee has been very
forward-leaning in arguing that and encouraging the Defense
Department to create an operational plan for the----
Mr. Young. I am about ready to run out of time. I love your
answer, but----
Ms. Conley. Thank you. Sorry----
Mr. Young. Mr. Chairman, I do apologize for that.
No, I am glad you answered that. This is for the Admiral.
Movement of Coast Guard monies to the Arctic, are you
remembering the rest of the responsibilities you have under
your wing: interception, fishing patrol, rescue? You are not
going to diminish from that, are you? Especially district 17.
Admiral Michel. No, sir. We are committed, as we have
always been, to our responsibilities in Alaska.
Mr. Young. OK, all right. I missed Mr. Garamendi's
comments. I am one that believes that we are not going to get a
Coast Guard cutter for a long time. I really don't see the
push. We need it, cutters. And I think Mr. Paxton and his
shipbuilders are willing to build them.
Did you make any comments on the leasing concept? Have you
analyzed this, or it is just coming from the other side?
Mr. Paxton. Sir, we have no comment on the leasing side of
things, other than we know there are vessels out there that
could be leased, sir.
Mr. Young. Well, because I just--you know, I am concerned,
Mr. Chairman, the next--we sit here at this committee--maybe,
God willing, you will be here for 10 years. Hopefully, I will
be, too, or I may be in the deep sea, I don't know.
But we need something to be happening. We are not having
anything really--we have the Arctic Council. Big deal. What
have we done? We have some meetings. We have some more meetings
and some more meetings and some more meetings. And I want to
know. Is there going to be--not just this administration, I am
not banging this administration--oh, I love to do it.
But is there any Arctic--real Arctic policy? Is there any--
is anybody setting--do you want us to do it for you? If you do,
we will screw it up. You guys have got the expertise in it. Is
there anybody really coming together on what we are going to
do?
Anybody can answer that. Then I am out of time, I know.
Anybody can answer it.
Ms. Grover, you look anxious to do something.
Ms. Grover. Well, the Arctic Executive Steering Committee
was formed in early 2015 in part specifically for the purpose
of trying to bring together all of the parties into a unified
effort. But as for how that is going, I can't say. But yes,
there are a lot of different parties involved in a lot of
different efforts. And much of it is involved in discussion and
exploration in the learning phase, essentially. And I think
there would--we would all benefit from some additional
leadership and strategic leadership.
Mr. Young. Well, Mr. Chairman, if I may suggest, either we
set the policy--because none of the groups are going to get
together. We will have meetings and meetings and meetings
again. I like that word, ``meetings.'' And what I am saying,
either we set up a policy or we set up a chief, period, by a
legislative action. Because you are not going to get the Navy
and the Coast Guard and the EPA and--all together. They won't
agree to anything.
Maybe we need somebody to be the dominant factor, because I
do believe the Arctic is going to be the biggest challenge we
have, as a Nation. We are an Arctic nation, and the next 20
years is going to be the problem. We are so far behind right
now. I look at the Russian fleet with its nuclear icebreakers,
and I look at their establishments of where they put these
little military base--we are really close to it. I can't see
Russia from my house, I can tell you that. But we are pretty
close.
I used to fly over it, by the way. You don't know that, but
I had a lot of fun. Cost them a lot of money, too. But their
radar doesn't work 35 feet off the deck, I want you to know
that. They may not know that. You can fly right over there.
Getting back is the problem.
But you know, we are getting behind. And I understand why
they are doing it, Mr. Chairman, they have got--it is the
resource icebox of--refrigerator of the world, and we are just
sitting here.
So, Mr. Chairman, I don't have much I wanted to say, but I
would like to see a position where we are going to say next
year we have a policy on the Arctic. We need icebreakers. We
will make that decision. I just don't think there is many
people understand it. And we need a policy, militarily and
security-wise. And just not on the Coast Guard's back, it is on
everybody's back.
Mr. Chairman, I thank you for the extra time.
Mr. Hunter. Thank you, Mr. Chairman.
Mr. Garamendi, you are recognized.
Mr. Garamendi. I was just thinking about our friend from
Alaska. And one of his favorite things is fish or cut bait. We
are coming to that point, I think. And so we are going to have
to make some decisions here and put it in place.
Mr. Chairman, you were speaking earlier of the NDAA, and I
believe that the $1 billion from the Senate is in the NDAA. Is
that correct? I think that is correct. Senate appropriation
bill.
Mr. O'Rourke just described different ways we could come to
a conclusion here and set the policy in place. It is very clear
to me that the administration is not in a position to make a
definitive policy statement. They are kind of biding their time
with $150 million in the various--and then laying out some
strategy into the future. And that is really a result of
Congress not willing to appropriate money.
So I think in the next 3 months, as we get the information
on the Polar Sea, and whether it can be refurbished or not, as
we deal with the appropriation, as well as the NDAA, that we
are in a place where we can make a decisive decision with
regard to the future of the icebreakers.
My own preference here is to use the NDAA and/or the
appropriation, or both, to lay out a block buy for at least
two--well, let me just say for two new icebreakers to be built
in the next 5 to 7 years.
I notice, Mr. O'Rourke, you laid out a projection of
expenditures over the next 7 years for one icebreaker. I would
ask the Admiral Michel to lay out a projection for block buy,
two icebreakers over the next 7 to 8 years. And also, how that
timeframe can be compressed to reduce the gap that everybody
has talked about and that apparently is a very real gap in the
ability to operate in the Arctic and Antarctic.
So I think we need to be very precise here. And, Mr.
Chairman, I would encourage you in your leadership role in this
to undertake a process that, when the NDAA is completed--the
conference committee presumably is going to get underway while
we are in recess--that we take up this issue, we build into
that NDAA conference committee and the appropriation a specific
plan.
My recommendation, once again, is a block buy, two
icebreakers over the next 7 to 8 years. And in the next month,
careful analysis by this committee as to whether we can
refurbish the Polar Sea to address the gap issue, and what it
might propose--might be available to us, beyond.
Also, it seems to me that there are the other five issues
with regard to the Arctic and the Antarctic. The communications
strategy, Admiral, I appreciate the communication--that is, the
ship itself being communication. I think, however, that is
going to be inadequate. Certainly the Navy issue is part of
this. There are submarines, both ours and others, that will be
operating in the area. So I think the communication issue needs
to be fully vetted and brought to our attention so that if it
is in our--I know both the chairman and I are on the House
Armed Services Committee, and certainly that will be a piece of
that puzzle, also. And domain awareness and communications I
think are probably one and the same.
Infrastructure, the Army Corps of Engineers. What are
their--and, Admiral, if you could, brief us on the
infrastructure issue which has been raised. Does us little good
to have a heavy icebreaker in the Arctic with no fuel and no
ability to get fuel, except to return to Seattle.
And then finally, the training mission, which was part of
your testimony. We will go into that in more detail, later.
Those are the five areas. I think we must be prepared, as a
committee, to make a decision and get on with it and, frankly,
commit the United States to spending the money to get the job
done. You know, we have got a 2-year timeframe for our
contracts for every 2 years, but I think we ought to commit the
future Congress.
With that, I yield back.
Mr. Hunter. I thank the gentleman. Mr. Sanford is
recognized, as long as he doesn't advocate buying Russian
icebreakers.
Mr. Garamendi. By the way, Mr. Chairman, I----
Mr. Sanford. That is a much longer conversation----
Mr. Garamendi [continuing]. Am going to take my final 15
seconds----
Mr. Sanford [continuing]. The Jones Act, but we will come
back to that on another day. The--thank you, Mr. Chairman.
I guess, Admiral, first question would be, following up on
my colleague from--well, Ms. Hahn's question with regard to
cruise lines in the Arctic and your sharing of resources and
capacity without charge, I struggle with that in that there is
always unlimited demand for a product that somebody else is
paying for.
Wouldn't there be a cost-sharing arrangements that could
both benefit the taxpayer and take care of the safety needs
that the Coast Guard is responsible for?
Admiral Michel. Sir, we have a, as a matter of policy, not
charged for prevention-related services. Otherwise, what ends
up happening is people do not engage with us to try to save
money, and then they go out there and do stupid things that we
have to clean up from.
So, as a matter of policy, we don't charge for search and
rescue services for those reasons, sir.
Mr. Sanford. Understood. But I think the question one would
have to ask is when you go into the Arctic you are going into
harm's way. And so to, in essence, offer incentive to go into
harm's way would be the equivalent down in--off the coast of
South Carolina is kind of a tropical wave or tropical
depression to say we will facilitate your ability to go out
into those waters as a, you know, coastal disturbance is headed
our way. That seems to me to invite some level of peril that
would not be the case if they were taking unsubsidized risk.
Admiral Michel. Sir, I can't disagree with you, that you
can take that particular viewpoint. The Coast Guard's viewpoint
is we would rather engage with stakeholders upfront to buy down
risk and prevent a catastrophe from happening, rather than
disincentivizing people from engaging with the Coast Guard, and
then they go out and do something very tragic, particularly
when you are talking about having 1,700 people on board, sir,
who probably are just paying for a vacation and don't apprehend
exactly the situation that they are going to get themselves
into.
Mr. Sanford. I hear you. I would like to come back to that
question.
In the same regard, just in terms of taxpayer concerns, if
I remember right the Polar Sea used to leave the Upper
Midwest--excuse me, the Northwest, and take a--basically, a
month-long trip down to the Antarctic, open up the channel for
the once-a-year drop-off at McMurdo Station, and then take
another month trip back. Might there not be a lower cost
leasing, borrowing alternative to the--in essence, it is one
mission--that would then free up capacity for the patrol of the
Arctic, given some of our shared concerns with regard to
Russian aggression or claims, et cetera?
Admiral Michel. Yes, sir. Well, part of the earlier
discussion was whether, you know, leasing a vessel like that
would be appropriate. As far as heavy icebreaking capability,
there is no heavy icebreaking capability available for lease on
earth that the Coast Guard is aware of, and we have looked
around, sir.
Mr. Sanford. Does anybody else open up channels in the
Antarctic, as we do, going into McMurdo?
Admiral Michel. There have been three vessels that--well,
there are a number of vessels over many years. That has been
done over many, many decades. But I will talk here in the
recent times.
So the National Science Foundation actually chartered for a
vessel called the Krasin, which is a Russian medium--almost
heavy--icebreaker to break open that channel. They also
chartered the Oden, which is a Swedish icebreaker, to work in
that area. And they also chartered a vessel called the Vladimir
Ignatyuk. Each one of those vessels, to varying degrees, was
able to do that.
For example, the Oden was able to actually work in that ice
area. The problem with the Oden is it has very challenging
open-water characteristics, so its ability to move down from
Sweden down to work in that area was challenged because of its
open-ocean characteristics. Plus, that vessel was actually
pulled back on very short notice by the Government of Sweden
when they had an icebreaking opportunity.
The Vladimir Ignatyuk, for example, could only work in the
already-cleared-out channel, and would not have been able, on
its own, to have--actually carve that channel. So there have
been vessels that have worked down there to varying degrees of
success, none of which are as capable as either Polar Sea or
Polar Star.
Mr. Sanford. Understood. But it could possibly be done
through those kinds of leasing arrangement, and thereby free up
2 months of capacity for Polar Sea or its equivalent to be on
patrol, in essence, in the Arctic.
Admiral Michel. Well, like I said, sir--and Krasin, for
example, actually did that. But Krasin is a Russian vessel.
Mr. Sanford. OK.
Admiral Michel. And really is no opportunity for the Coast
Guard----
Mr. Sanford. One last--I see I am down to 16 seconds, so
let me interrupt, if I might. Two things, I guess. One, Ms.
Stiller had a question with regard to Navy versus Coast Guard
roles, and any degree of further differentiation, as you would
see it, between those two roles.
And the last question would be, given the way in which
different folks have asked the same question, which is if you
were to pick a single linchpin--and this would be for anybody--
that would make a difference with regard to perceived Russian
aggression in that part of the world, it would be what?
Ms. Stiller. Well, sir, I am on the acquisition side of the
house. But the Chief of Naval Operations was asked back in
March in front of the Senate Armed Services Committee about the
Navy's role in the Arctic, and whether we are meeting our
operational missions. And we are currently, because we are
doing that with undersea and air assets. So we don't require
the icebreaking capability that the Coast Guard provides as
part of their mission for our operations right now, in the near
term, in the Arctic.
Admiral Michel. I am not sure I exactly understand the
question, but the Coast Guard is committed to this mission set.
We believe that the MOU that was signed in 1965 is still the
appropriate assignment of duties. The Coast Guard has put forth
candidly our execution challenges.
And our single biggest investment and our biggest
recapitalization priority for this particular mission set is a
heavy polar icebreaker, sir. That provides you with the access
and the ability to actually, by presence, project sovereignty.
If you can't get there because you have been denied by the
environmentals, you cannot project sovereignty. And that is our
number-one recapitalization investment for this problem set,
sir.
Ms. Conley. Sir, on your last question, just on the
signaling to the Russian Government, I would argue that the
United States needs to recognize the shift, publicly, that has
occurred, that there are changes in their military posture that
do cause us concern.
I think we need to arrest the withdrawal of forces, key
forces that we are anticipating, the withdrawal of Army forces
in Alaska, think about enhancing our force posture. It is
signaling that we recognize this, and we are prepared to make
necessary adjustments to our force posture, if required.
Mr. Hunter. The gentleman yields back. Mr. Garamendi is
recognized.
Mr. Garamendi. Mr. Paxton, you indicated that there are 10
shipyards that are capable of building a heavy icebreaker. Is
that correct?
Mr. Paxton. Yes, sir.
Mr. Garamendi. And they are prepared to do so.
Mr. Paxton. Well, they are certainly interested, sir. At
the Coast Guard's Industry Day there was 10 shipyards that
showed up. They are all members of my trade association.
Whether or not they will be building or partnering, they want
to have a say in this, or at least a comment on it. So yes,
there is high interest.
Mr. Garamendi. Very good. I want to make one thing very
clear with regard to where I would come from on the policy of
American built or foreign built. No way, no how will this
icebreaker--one, two, or more--be built in a foreign shipyard.
It will be made in America, period.
Mr. Paxton. Yes.
Mr. Garamendi. Now, if we want to have a brawl, then we can
fight about it. But it is going to be made in America, at least
as far as I am concerned.
With regard to the nature of the icebreaker, Admiral Michel
and Mr. O'Rourke, you lay out in your testimony, Mr. O'Rourke,
the various capabilities of the icebreaker.
Mr.--Admiral Michel, I assume you have--this information
comes from you, or from the Coast Guard. Does--have you had a
chance to look at Mr. O'Rourke's testimony, and particularly
the way in which he lays out the capabilities of the
icebreaker, of the new icebreaker, the new, heavy icebreaker?
Admiral Michel. I have read his testimony, sir. I am not
sure exactly which part you are describing.
Mr. Garamendi. Well then, let me proceed here. Mr.
O'Rourke, thank you for laying it out in your testimony.
Admiral Michel, if you will take a look at that testimony
and get back to us as quick as possible as to whether--it is
appendix A of the testimony from Mr. O'Rourke--as to whether
that is a reasonable or accurate recitation of the Coast
Guard's requirements.
Mr. O'Rourke, where did you get that information?
[The analysis of Admiral Michel of the U.S. Coast Guard
follows:]

The section titled ``Desired Capabilities for New Polar
Icebreaker'' in Appendix A of Mr. O'Rourke's written testimony
represents a partial summary of the requirements delineated in
the Operational Requirements Document (ORD), approved by DHS in
January 2016. Specifically, this Appendix highlights Key
Performance Parameters (KPPs) and other select elements. These
items, when combined with the totality of operational
requirements outlined in the ORD, describe the threshold
capabilities for a new polar icebreaker. A copy of the ORD has
been made available to industry for review.

Mr. O'Rourke. That is from the Coast Guard's own Industry
Day presentation and the briefing slides that they showed. So I
am simply transcribing, more or less----
Mr. Garamendi. OK.
Mr. O'Rourke [continuing]. What was on each of those
briefing slides.
Mr. Garamendi. Good.
Mr. O'Rourke. And I trust that I didn't do any violence to
the content in copying it over----
Mr. Garamendi. No need to go further. I thought that was
the case.
This document, or those--the recitation of those particular
requirements would then be the foundation for a congressional
authorization. Is that correct, Admiral Michel?
Admiral Michel. Yes, sir. Those--the capabilities that you
mentioned there were actually--came from the Operational
Requirements Document, which has been cleared by all the
interagency partners setting forth those requirements, and----
Mr. Garamendi. And----
Admiral Michel [continuing]. That is the type of vessel
that we need, sir.
Mr. Garamendi. Very good. Then what I am looking at is to
get this thing underway this year in either the appropriation
or the NDAA. And this recitation here describes what it is we
would want built. Are you happy with what you gave to the--or
what Mr. O'Rourke was able to get from you?
Admiral Michel. I am 100 percent happy, sir. That is
exactly the type of vessel that we need.
Mr. Garamendi. All right, then. It is up to us to give you
the authority and authorization, and not wait for the
administration, which--I guess the American public will decide
what that administration will be in the future, although I have
my own ideas about what would be best.
I want to also deal with the infrastructure issue. It seems
to me that that infrastructure issue is important. Ms. Conley,
you lay out--very good, and I appreciate your testimony,
because it gives us the larger context in which to consider
these things.
On the infrastructure side, let's have a very quick
recitation of the kind of infrastructure. Are we talking about
a deepwater port near or north of the strait? Admiral?
Admiral Michel. Sir, that has been one of the things that
we have talked about.
Mr. Garamendi. Well, no, let's not talk about it. Is it
necessary to have a deepwater port near or north of the Bering
Strait?
Admiral Michel. Sir, that is probably outside the Coast
Guard's lane. There are Coast Guard requirements for that type
of a port. So we would very much benefit from a deepwater port
that is closer----
Mr. Garamendi. So the answer is yes, you would need a
deepwater port to fully operate in the Arctic with a heavy
icebreaker.
Admiral Michel. It would be very beneficial to us, but
understand, sir, that when you get up into some of those areas,
that may be only a seasonal port because not all that stuff is
going to be ice-free, so you have to take that into account----
Mr. Garamendi. That is a very important issue, as to where
the port will be located. Is it seasonal or not?
Ms. Grover, Mr. O'Rourke, Ms. Conley, what is your position
on an infrastructure?
Ms. Grover. Only that it is a significant investment to
develop infrastructure in the area. And so we would yield to
the Coast Guard's analysis of whether it would be worth it----
Mr. Garamendi. You don't have a position.
Mr. O'Rourke?
Mr. O'Rourke. No position. I would just----
Mr. Garamendi. Ms. Conley, you----
Mr. O'Rourke [continuing]. Highlight the fact that the--
Mr. Garamendi [continuing]. Want to give us the context of
strategy, national strategy?
Ms. Conley. We urgently need more infrastructure. In
addition to a deepwater port we need additional aviation
assets, greater hangar space. We have to prepare for a much
more significant response. And it is a comprehensive package.
It needs to be a full strategy.
The fact that Shell has withdrawn and the question of
Alaska's future energy picture has really delayed further
infrastructure development that would have been a more public-
private partnership. So now we have even taken a further step
back on infrastructure needs.
Mr. Garamendi. OK. I guess my final question here really
goes to our staff, and that is the infrastructure issue may be
beyond the reach of this subcommittee. But I am of the opinion
that we are not going to be able to achieve the goals and the
requirements of this subcommittee unless we have infrastructure
in place. And that is both the communication, as well as the
port refueling and other kinds of facilities. And so, we ought
to spend some time on that.
Thank you very much. I yield back.
Mr. Hunter. I thank the gentleman. I am just going to throw
this out here before I yield to Mr. Graves. I mean we asked for
this information prior to the hearing, but did not receive it.
We need the data that you have, going back from 2015 to as far
back as you have it, for the Polar Star and the Healy,
including the times the vessels are transiting, the time the
Polar Star spends in the Arctic and Antarctic, its time in port
for maintenance work, and same for the Healy, its transit to
the Arctic, conducting missions for operations and their time
in port, please.
Admiral Michel. We will get you that, sir.
[The information from Admiral Michel of the U.S. Coast
Guard follows:]

From fiscal years 2007 to 2012, the USCGC POLAR STAR (WAGB-10)
was non-operational (in commission, special) in Seattle. The
cutter was reactivated in June 2013 and conducted ice trials in
the Arctic during that fiscal year. CGC POLAR STAR then
completed Operation DEEP FREEZE 2014, 2015, and 2016 in
McMurdo, Antarctica.

Table 1: Summary of employment days for POLAR STAR, fiscal years 2013-
2015
------------------------------------------------------------------------
USCGC POLAR STAR FY13 FY14 FY15
------------------------------------------------------------------------
Transit Days........................... 25 61 47
Days in Arctic......................... 33 0 0
Days in Antarctic...................... 0 33 46
Underway Training...................... 0 9 10
Inport/Maintenance..................... 300 235 251
Inport Training/Logistics.............. 7 27 11
--------------------------------
Sum.................................. 365 365 365
------------------------------------------------------------------------

From fiscal years 2010 to 2015, USCGC HEALY (WAGB-20) was
annually deployed to the Arctic, and conducted missions in
support of the Artic Icebreaker Coordination Committee. In
addition, in January 2012, HEALY completed a 26-day unscheduled
fuel resupply of Nome, Alaska, that is accounted under ``Days
in the Arctic'' in fiscal year 2012.

Table 2: Summary of employment days for HEALY, fiscal years 2010-2015
----------------------------------------------------------------------------------------------------------------
USCGC HEALY FY10 FY11 FY12 FY13 FY14 FY15
----------------------------------------------------------------------------------------------------------------
Transit Days.................................. 25 27 29 35 56 30
Days in Arctic................................ 81 71 125 61 84 57
Days in Antarctic............................. 0 0 0 0 0 0
Underway Training............................. 29 31 11 16 11 21
Inport/Maintenance............................ 182 210 158 224 143 158
Inport Training/Logistics..................... 48 26 43 29 71 99
-----------------------------------------------------------------
Sum......................................... 365 365 365 365 365 365
----------------------------------------------------------------------------------------------------------------

Mr. Hunter. Thank you.
Mr. Graves, you are recognized.
Mr. Graves of Louisiana. Thank you, Mr. Chairman. I want to
follow up on Mr. Garamendi's last line of questioning.
Admiral, icebreakers, as Ms. Grover noted in her testimony,
it is not a silver bullet to addressing all of the needs of
providing all the capabilities in the Arctic, things like oil
spills, mass casualties, terrorism events. Can you explain what
is being done to address other capabilities, meaning non-
icebreaking capabilities in the Arctic, to provide the Coast
Guard or the Federal Government with the capabilities they need
to respond to some of these other events?
Admiral Michel. Yes, sir. Well, our presence has been
largely mobile and seasonal. So we use the vessels, whether
they be icebreakers or not icebreakers. I mean buoy tenders--we
have had our National Security Cutter up there that--we use
that type of a mobile presence. Plus, we have also established
forward operating bases. We have done them at Dead Horse,
Barrow, Kotzebue. These are temporary facilities during--
primarily during the summer, where we provide services like
search and rescue, aids to navigation work, working with the
local tribal people for fisheries and forest, or protection of
mammals, and all those types of things, our presence has
largely been mobile and seasonal because the human activity has
been so dynamic.
I know Ms. Conley mentioned about Shell. We had to move
certain things when Shell was up there, but now Shell is not up
there. So investing in permanent infrastructure up there is not
where the Coast Guard currently is focused, although we look at
that all the time.
Right now we like mobile and seasonal because we can move
where necessary to match the human activity. And that is the
beauty of having ships that can actually operate up there,
because they come with a command and control suite, they can
help with oil spills, they can help with search and rescue,
counterterrorism, border security, fisheries enforcement, and
you can move them as the seasons and as the activities and
requirements dictate.
Mr. Graves of Louisiana. OK, thank you. Next question,
Admiral, earlier we talked a lot about heavy icebreaking
capabilities, and you have gone back and forth into medium
capabilities, the Healy being the medium icebreaking vessel
that we have right now. Can you talk a little bit about
acquisition strategy on mediums?
And I know the priority is the heavy, and I know your
allegiance to the President's budget, but could you talk a
little bit, looking forward on acquisition strategy for
mediums?
Admiral Michel. Yes, sir. So you have laid out--the High
Latitude Study also calls for three medium icebreakers. We have
got the Healy current extant, but we actually have a
requirement for a couple others. We have an integrated product
team stood up, we want to develop an Operational Requirements
Document, an ORD, for medium icebreakers, just like we have
done for the heavy icebreakers. And that is a recapitalization
need for the Coast Guard moving in to the future. So we have
got a plan for that, as well, sir.
Mr. Graves of Louisiana. When do you anticipate budget
requests for that?
Admiral Michel. Oh, sir, I wouldn't want to speculate on
that. We don't have the ORD done yet. And the ORD lays out
those capabilities that Mr. Garamendi identified for the heavy.
We have to have that agreement amongst the interagency partners
as to what the interagency requirements are. So I wouldn't want
to put a timeline on that, sir.
Mr. Graves of Louisiana. OK.
Admiral Michel. I will agree to keep you informed as we
move through the process.
Mr. Graves of Louisiana. I would appreciate that. In fact,
I am sure the entire committee would.
Let me go back to the first line of questioning Mr.
Garamendi had, and there was something that was left, and I
want to make sure I understand the ultimate conclusions.
So Mr. Garamendi asked the panel if leasing was an option.
As I understand, basically folks said no. However, I heard a
few things that seemed to contradict that, and I want to make
sure I understand.
So Mr. Paxton said that there actually were medium
icebreaking capabilities that were available. Ms. Grover said
that the options were unaffordable. So just--I want to make
sure I understand this.
So, number one, are there private capabilities that are
available to the Coast Guard for leasing? Just yes or no.
Admiral Michel. There are none available, sir, that are
suitable for military service without substantial refit.
Mr. Graves of Louisiana. OK. And so then, Ms. Grover--and,
Mr. O'Rourke, I will come to you in 1 second--Ms. Grover, in
regard to your statement earlier--and I don't want to put words
in your mouth, but I think you said that they weren't--I don't
know what word you used, but affordable to the Federal
Government. Could you just explain where that information is
from, if--earlier it appeared that folks were saying there
weren't even capabilities there.
Ms. Grover. Sure. It is that leasing, relative to purchase,
is generally going to cost more because of profit and
interest----
Mr. Graves of Louisiana. Sure. But also I just want to make
clear that we have all acknowledged that there is a gap in
capabilities here. And so in some cases, if there is a gap,
then we may have to pay a premium, perhaps. And I am not
verifying or confirming there would be a premium paid. But if
we don't have capabilities, then we may have to pay extra in
order to fill that gap. Would that be fair?
Ms. Grover. If there were a vessel that was suitable for--
--
Mr. Graves of Louisiana. Sure, sure.
Ms. Grover [continuing]. The Coast Guard, they could----
Mr. Graves of Louisiana. OK.
Ms. Grover [continuing]. Enter a demise lease.
Mr. Graves of Louisiana. Great, thank you.
Mr. O'Rourke?
Mr. O'Rourke. Yes, I just want to emphasize that we are
talking about two different forms of leasing here. Ms. Grover's
testimony was focused on a long-term lease as an alternative to
purchasing a ship for a 30- or 40-year expected service life.
There is also a separate question of whether you would want to
do a short-term lease for temporarily filling a gap prior to
the time that new U.S. icebreakers come into service.
In my testimony I used the term ``charter'' to try and
differentiate this shorter term scenario from the longer term
one that Ms. Grover talked about. The shorter term ones would
depend upon the availability of the ships for those shorter
term charters, and the capabilities that they would bring, the
prices that you would charge, and whether that would make
sense, from our point of view.
Mr. Graves of Louisiana. Sure.
Mr. O'Rourke. We have done that in the past on at least
three occasions since 2005, and it might be possible to do it
in the future, depending on the availability and cost
effectiveness of that option. But those are short-term
charters, as opposed to the long-term lease, which is an
alternative to a purchase.
So we always have to keep that in mind, and that is why we
can sometimes get cross-talk on the issue.
Mr. Graves of Louisiana. Great, thank you. And I think that
is a really important distinguishing factor here, is that we
are not talking about leasing to supplant the ultimate
acquisition of a Coast Guard vessel, but simply to complement
this strategy where we have gaps that folks have identified in
their testimony.
And Mr. Chairman, if I can have a little bit of latitude, I
promise I will shut up after this. Thank you, Mr. Garamendi.
Mr. Paxton, let me give you one more chance. You seem to--
last time, for the record. CRS noted in their testimony that
there may be cost savings as a result of building more than one
vessel, or piggybacking on an existing Navy or Coast Guard
contract that is underway because of the ultimate reduction in
overhead costs and others. Could you comment on that?
Because, look, let's be clear, $1 billion for one vessel is
an extraordinary figure, and I just want to understand, looking
at costs down the road and other acquisition strategies.
Mr. Paxton. Yes, sir. Thank you, Mr. Graves, for the
question. Certainly with block buys you can get long lead-time
materials, you can have an acquisition strategy that allows you
to put workforce in place to manage multiple construction of
vessels. So you can really drill down on your processes to get
better cost savings in the long term. I believe Mr. O'Rourke
mentioned if you have two ships you might have a savings of
about $100 million. That is real savings. That is why you would
want to do it that way.
I think also, as an industry, our shipyards really strive
to get their processes down. When you have a lead ship and you
build just one ship, a lead ship, you don't get your chances to
get your processes down because it is a lead ship and you are
only building one. Hence, it is expensive. But if we build
three heavies and three mediums, you are going to get a cost
savings there, because the shipyards are going to strive to get
those processes streamlined, they are going to have long lead-
time materials that they can purchase in block, and they can
really drive down expenses.
So, I think there is enormous value to the taxpayer. And
also we have heard from all the panelists there is a national
security need to do this. So if we are going to do it, I think
we should do it in multiple contracts.
Mr. Graves of Louisiana. Thank you, Mr. Paxton, very, very
helpful.
And Mr. Chairman, for the record, as I recall, I think Mr.
Paxton--on the fifth time he proposed to his wife she said yes.
So just a----
[Laughter.]
Mr. Paxton. Yes, that is great. Thank you, sir.
Mr. Hunter. I thank the gentleman. Mr. Young is recognized.
Mr. Young. One of the deficiencies in the Arctic is the
lack of hydrographic and coastal survey data. I know NOAA
[National Oceanic and Atmospheric Administration] is doing this
right now, but under title 10 the Navy has a responsibility.
How far along are we in that? And are you sharing that with the
other interested parties?
Ms. Stiller. Sir, again, I am an acquisition professional,
but I will get you the right answer. But yes, we do partner
with NOAA and others. In fact, we have built vessels within the
SCN account for NOAA to do that research.
Mr. Young. But have you shared--because I know you have
done quite a bit of work. Has that been shared now?
Ms. Stiller. As far as I know, yes, sir. But I will get you
that----
Mr. Young. Would you get back to me on that?
Ms. Stiller. Yes, sir.
[The information from Ms. Stiller of the U.S. Navy
follows:]

Most of the Navy's modern Arctic bathymetric data is collected
by submarines. The Navy has already declassified and released
as much existing Arctic Ocean bathymetric data as possible. In
addition, the Navy has established an ongoing process through
which additional Arctic bathymetric data is released as quickly
as possible after submarines transiting the Arctic return to
port. Bathymetric data released publicly by the U.S. Navy
continues to be the main source of data used by the
International Bathymetric Chart of the Arctic Ocean (IBCAO).

Mr. Young. I am going back to--I will get the elephant out
of the room here, in a sense.
During the Shell activity there were anchor-layer
icebreaking-capable ships. Is that correct, Mr. O'Rourke?
Mr. O'Rourke. There was one that was actually built to
support Shell's operations, and it was a privately owned ship.
Mr. Young. That is right. It is a privately owned ship. It
has tremendous capability of icebreaking power and the bow. If
that could be retrofitted in 1 year's time or year and a half,
that would fill that gap. Would you be interested in that,
Admiral, if that was to take place?
I know you have the proposal on your desk, by the way. It
has already been laid on your desk, and it is an automatic no.
Why?
Admiral Michel. Sir, our Commandant actually personally
visited that vessel, and we are of the opinion that that vessel
is not suitable for military service without substantial refit,
and I can go into----
Mr. Young. But that----
Admiral Michel [continuing]. The reasons why, sir.
Mr. Young. But wait a minute, stop. You think so. But if
the shipbuilder said that he--``I can take and meet your
requirements with the bow that it has now, tungsten steel,
heavy, and the power to do it,'' see, because I--by the way,
Admiral, I have been through this now--I have been here when we
built the Healy, you know. I know what I am talking about. And
you have always hated the idea of not owning the ship. But we
have a gap here that has to be put in place.
How are we going to do it, if you don't accept another
vessel? American-built, American-manned, American-maintained.
Why can't you accept that? Because you are not going to get a
Coast Guard in 10 years. Why can't you accept that? If it can't
do the job, you don't pay them. Answer?
Admiral Michel. Sir, our current opinion is that ship is
not suitable for military service without substantial refit.
Mr. Young. See, and that is what I call, Mr. Chairman, a
bullshit answer. Military service.
Mr. Hunter. I thank the gentleman.
Mr. Young. I talk about--I am talking about moving ice.
Mr. Hunter. All right. Let's get into that, if you don't
mind, Admiral. Let's go on the mil specs. So I am reading this.
The Coast Guard polar icebreaking mission has four parts:
breaking out McMurdo Station and providing some show of U.S.
sovereign presence in the Southern Ocean. Does that require a
military vessel or an icebreaker? I am just asking logically--
--
Admiral Michel. Sir, the Coast Guard only operates military
vessels.
Mr. Hunter. Does that require a military vessel to do that,
what I just said?
Admiral Michel. Sir, the Coast Guard only operates military
vessels.
Mr. Hunter. Has--does a non-military vessel ever break out
the McMurdo station?
Admiral Michel. Yes, it has.
Mr. Hunter. OK. So I am going to ask it again. Does it take
a military vessel to break out the McMurdo Station? That is a
yes or no answer, Admiral. That is all you got to give me.
Admiral Michel. No, sir, but not in Coast Guard service.
Mr. Hunter. OK. To provide an Arctic research platform,
does that require a military vessel?
Admiral Michel. No, sir.
Mr. Hunter. Meeting the Coast Guard maritime safety, search
and rescue, fishery law enforcement, oil spill response in the
Arctic, does that require a military vessel?
Admiral Michel. For the Coast Guard, yes, sir.
Mr. Hunter. Does that require a military vessel, though?
Admiral Michel. It----
Mr. Hunter. And when you----
Admiral Michel. I think you prefaced that with Coast Guard
requirements. Yes, sir. We don't operate non-military vessels,
sir.
Mr. Hunter. I didn't ask if you would operate non-military
vessels. I am asking you can a non-military vessel provide for
search and rescue?
Admiral Michel. Yes, sir.
Mr. Hunter. Fishery law enforcement, oil spill response?
Admiral Michel. Fishery law enforcement? No, sir. That
requires a law enforcement vessel of the United States, a----
Mr. Hunter. A law enforcement vessel----
Admiral Michel [continuing]. Military vessel.
Mr. Hunter. Then a military vessel.
Admiral Michel. Yes, sir. Law enforcement----
Mr. Hunter. But you need----
Admiral Michel. The Coast Guard vessels are both military
vessels and law enforcement----
Mr. Hunter. I mean what do--do you need a CIWS on this,
or--what--do you need to shoot rockets or missiles off its
surface? What are we talking about when you say military
vessel?
Admiral Michel. Sir, a military vessel of the United States
is classified as a war ship under international law. It has
certain privileges and immunities that go along with that. A
military vessel of the United States is built to military
specifications for military interoperability, for military
survivability, for damage control----
Mr. Hunter. Let me----
Admiral Michel [continuing]. For water-tight integrity----
Mr. Hunter. But let me ask Mr.----
Admiral Michel [continuing]. For propulsion systems. And
they are not built to commercial standards, sir.
Mr. Hunter. Is the Littoral Combat Ship totally built to
military specifications?
Ms. Stiller. Mr. Chairman?
Mr. Hunter. Mr. O'Rourke or Ms. Stiller, you could both
answer that, I guess.
Ms. Stiller. The LCS is built to Naval Vessel Rules, which
includes some commercial specifications but they are
militarized, so yes. And in fact, in the case of LCS, right now
we have completed our Total Ship Survivability Trials on both
variants, and we are into the Full Ship Shock Trials to prove
out that we accurately met the design parameters for those
ships.
For the Independence variant, we have already conducted two
of the tests. We have one more to go, and then, for the Freedom
variant, we are going to conduct the test in August. But yes,
sir----
Mr. Hunter. I understand. I don't want to get too deep in
the woods on LCS. So--but I just don't understand. One of the
Coast Guard's excuses for not using a leased vessel or a less
expensive vessel is that it is not a military-type vessel, yet
the Navy put a lot of money into a lot of ships--it is changing
now, but into a bunch of ships--the future of the Navy was the
LCS--at that time, and that was not a--that--they didn't
require a military vessel for those ships.
So you are telling me that the Coast Guard, to break ice--I
am just using logic here, not semantics--to break ice needs a
more militarized vessel than the Navy does, in terms of
survivability? I don't understand.
Ms. Stiller. Sir, I am going to defer to Admiral Michel
here, but what he is talking about is we do design and build
these ships to military standards in certain areas. And you can
have a blend of military-commercial standards across----
Mr. Hunter. That is not what he said.
Ms. Stiller. It depends on the vessel. But I would say that
it--but it is to the war-fighting capability and the
protections you have as a war-fighting asset. I think that is
where you are going on that.
Admiral Michel. Boy, this is--I mean there is a lot in your
question there, sir.
First of all, these are multimission assets that the Coast
Guard operates. They don't just break ice. They assert national
sovereignty, they conduct law enforcement.
Mr. Hunter. And I just asked you--Admiral, hold on. I just
asked you four things, the four things that an icebreaker has
to do, and you said it doesn't take a military ship to do any
of them. I asked you does it take a military ship to do these
four things. You said no, no, no, and no.
Admiral Michel. Sir, and that is not the totality of what a
Coast Guard cutter does. I think we have got a misapprehension
here, sir, on what the characteristics of these vessels are.
The Coast Guard operates Coast Guard vessels, we don't just--
this is not a pickup game for the Coast Guard. We have very
specific requirements for our vessels, including international
law requirements for assertion of things like navigation
rights.
Mr. Hunter. OK.
Admiral Michel. This is a very--I think maybe you--sir, and
I am happy to--I know you think I am being nonresponsive, but I
am not. I am happy to have this dialogue with you on what this
vessel is. This vessel does not just break ice, just like the
Polar Sea and Polar Star just do not break ice. Those are the
assertion of national sovereignty through war ships of the
United States, military vessels operated by an armed force of
the United States, the Coast Guard. I think maybe we have
gotten----
Mr. Hunter. Got you.
Admiral Michel. I think that is where our gap is, sir.
Mr. Hunter. And again, we are never going to see one of
those while any of us are here. Mr. O'Rourke might be around
for a long time.
One last thing here, and then I am going to yield to Mr.
Garamendi and we will close. And thank you very much for giving
us a little bit of extra time here.
I guess the biggest question is--which we have all talked
about--the gap, 3- to 6-year gap. We all agree we need to build
a heavy icebreaker. Going to get $1 billion possibly coming up.
That is going to go towards building a heavy icebreaker, maybe
accelerating a medium icebreaker being bought. Will you guys
even look at that, to go in a heavy and a medium, as opposed to
two heavies?
Admiral Michel. Sir, I am open for all options.
Mr. Hunter. OK. So one potential bridging mechanism the
Coast Guard has touted for years is the reactivation of the
Polar Sea. In 2012 this subcommittee--that is before I was
here--this subcommittee had to pass law directing you to
analyze the reactivation of the Polar Sea and provide Congress
that analyzed--that analysis by 2013, September, almost 3 years
ago, with a determination of whether the reactivation was cost
effective. Not just an analysis on how messed up the boat was,
but whether it is cost effective to fix it.
You did the analysis, but failed to make a determination.
So in a week or two you are going to provide this committee,
once we are out, another analysis of reactivating the Polar
Sea--Polar Star. Let me ask you this--Polar Star, right? Sorry,
Polar Sea.
Admiral Michel. Polar Sea, sir.
Mr. Hunter. Polar Sea is broken. Star is working. Are you
going to give us a determination on the cost effectiveness on
the 24th? Are you going to come out and say, ``Here is what we
see wrong with it, here is what it is going to cost to fix it,
and we determine that that is too much,'' or, ``that sounds
good''?
Admiral Michel. You are going to get everything but the
last part, sir. We are going to give you the cost, we are going
to give you the materials, the engineering challenges, and so
on and so forth. The actual alternatives analysis, that is
arrayed against the broader problem set. That is what is due by
the end of the calendar year.
Mr. Hunter. OK. OK. Mr. Garamendi, I yield to you.
Mr. Garamendi. Mr. Chairman, I want to thank you and your
staff and my staff for really pushing this issue forward, and
for the witnesses. Some of you have been here multiple times.
I think the fundamental issue is before us, before
Congress, as to what--and to explicitly state what it is that
the administration is going to do. And I would propose that
over the next 3 months, as the NDAA and the appropriation
process go forward, that we take upon ourselves to set the
policy in place. And for me, the policy that would make the
most sense is one that would authorize and, in fact, tell the
Coast Guard to build two, perhaps three, heavy icebreakers, or
two and perhaps a medium icebreaker in a block buy, and to get
on with it in an expeditious way, using the information that
the Coast Guard has developed as to the capabilities of the
heavy icebreaker. And perhaps also the medium icebreaker. I
think that is a decision that we have to make.
We cannot depend upon the administration. It will be a new
administration, they will take some years or year or more to
get their act together, and that is just the way it will be.
Not that either are incapable, it is just that transition that
will determine that.
So, with that in mind, there is one additional issue, and,
Mr. Chairman, you have made this, I think, very clear in the
most recent colloquy that you had with Admiral Michel about
what is military. And I notice our colleague from Alaska has
left, but this issue of military-capable is one that we need to
come to grips with here, because it is filling the gap issue.
And I think--not think, I believe that we must decide how
best to fill this gap. We don't have that information until the
24th of this month. And therefore, on the 24th we will have
from the Coast Guard their analysis of the Polar Sea and its
potential.
Ms. Grover, Mr. O'Rourke, your very quick and necessary
analysis of that proposal is essential. And I would ask the
chairman to request that you get that quickly back to us so
that when we return here in September we will be able to make a
decision as to whether to proceed with the Polar Sea or not.
And we need your capable analysis to do that.
I am in the mood to make a decision. You know, I know that
both the chairman and I are up for a new contract. I think that
both of us, hopefully, will be here to carry on. But before our
new contract is up, Mr. Chairman, I suggest that we make a
decision and push this issue--not push it, but set it in place
so that the next Congress and the next administration will know
precisely what it is that they are to do.
And with that, we have got some work out ahead of us. I
look forward to it. Very, very important hearing, Mr. Chairman,
I thank you for the time. And for the witnesses, I thank you
for your engagement on this issue.
And by the way, we are going to make it in America.
Mr. Hunter. We are going to make it in America. I would
ask--I think what Mr. Garamendi is referring to is not the
analysis of alternatives that comes at the end of the calendar
year, but what is wrong with the ship which comes in a week or
two. I think that once you two look at that, I think you can
beat the Coast Guard by months on what your alternatives
analysis is. I think you can do that.
It takes them--I mean it has been since 2012, so it has
taken them 4 years to give us this much, right? Let's try to--
and maybe you could get us that, and we can start working this
ahead of receiving whatever we receive in December 30 or 31. I
take it that is when we will get it. That is the end of the
calendar year, December 31. OK, I was right, all the way to the
end.
Admiral, I also would like you to give us, to this
committee, look at what Ms. Grover said, that you have to
have--you are not allowed to have Coast Guard on leased
vessels. Was that correct?
Ms. Grover. Not on a short-term lease, because----
Mr. Hunter. A charter, let's call it charter, like----
Ms. Grover. Yes, not a short-term lease or a charter,
because of what the admiral was stating before, that the
vessels have got to be able to carry out the ports, waterways,
coastal security mission, the law enforcement mission, and a
sovereign presence, which means a short-term charter or lease
it out, because it wouldn't qualify as a public vessel.
Mr. Hunter. OK. So give me this, Admiral, if you could.
Could you assist this committee with drafting assistance so--to
know how we would change that, if we wanted to? OK?
Admiral Michel. Yes, sir.
Mr. Hunter. Yes, sure. Go ahead. I yield to the gentleman.
Mr. Garamendi. Mr. Chairman, we--at least I am of the mood
to make some decisive decisions here, and to write law. And I
would request drafting assistance from the Coast Guard, and--to
achieve that goal.
Mr. Hunter. And, Admiral, last thing. We still haven't
talked about the 3-year gap. Right? You haven't told us yet
today--we have all talked about it, I think, but you haven't
told us how you are going to fill it. So I will leave the last
statement to you here to tell us definitely how you are going
to fill the 3-year gap.
Admiral Michel. So what is currently on the table is a
rolling recapitalization of the Polar Star, a reactivation of
the Polar Sea, and how we are going to fit Healy into that, and
that is the current situation, although we are out there
looking for other types of vessels or capabilities that may be
brought into the fight. That is what we currently have on the
table, sir.
Mr. Hunter. So can you plug the 3-year gap--you are telling
me there will not be a 3-year gap in an icebreaking capability.
You guys have it under control. Worst case scenario is what you
just said.
Admiral Michel. I think, sir, that a rolling
recapitalization of the Polar Star is achievable. I think that
it can be done within the operational parameters as I have
described to you before----
Mr. Hunter. When would that happen, 2023?
Admiral Michel. It--5 to 7 years from now is the projected
end date, so that is 2021 to 2023 under the current
recapitalization. Under a rolling recapitalization, we can buy
several more years out of the Polar Star. Whether we want to
bring Polar Sea on is the analysis that I owe to you, and I
have got a Healy SLEP I have also got to deal with.
Mr. Hunter. So say that you--we decide to say, OK, let's go
with Polar Sea, put in all new engines, and update her, and put
her in the water. When would that start? So let's say you came
out and you said, ``We analyzed, we looked at it, it is going
to be $1 trillion.''
We said, ``All right, here is $1 trillion. Go.''
Admiral Michel. Well, I think--I mean we could start on the
design work relatively soon, but it is going to require an
appropriation. As I described before--and I am going to give
you the entire report--that--it took us about $70 million to
recapitalize Polar Star. This is going to be multiples of that,
sir.
Mr. Hunter. But I am talking timewise. Would it be done in
time to fill the gap----
Admiral Michel. Absolutely, and that----
Mr. Hunter [continuing]. By 2023?
Admiral Michel. And that is part of the alternatives
analysis is what you are going to have to do is you are going
to have to time it so that you can recap Polar Sea so when
Polar Star is coming off the line you have got the ability to
have Polar Sea built out there. And all that has got to be
synched up with Healy, yes, sir. That is the difficulty in
pulling an alternatives analysis.
I can give you a material condition of a ship relatively
quickly. But to make the actual decisions and to get the
appropriations lined up and all the other things, that is a
complicated dance, and that is why it takes a while to do that,
sir.
Mr. Hunter. OK. Would you also provide us with not just
drafting assistance for the leased vessels, but how we would
change the language to do a block buy? And I would ask all of
you that, if you have a specialty, and if you know how to do
that, because we probably do, too, but it would be easier to
just have you tell us, because you are smarter.
Admiral Michel. Yes, sir. And we will work with the Navy on
that. They have more experience than we do with that, and we
could definitely work with you on that, sir.
Mr. Hunter. Because if we could possibly do that this year
in conference or in something else, so that would be great.
So, ladies and gentlemen, thank you very much. So thanks
for being here, thanks for going over 2 hours. And with that,
the hearing is adjourned.
[Whereupon, at 12:12 p.m., the subcommittee was adjourned.]
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