Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress Ronald O'Rourke Specialist in Naval Affairs June 14, 2012 Congressional Research Service 7-5700 www.crs.gov RL32665 CRS Report for Congress Prepared for Members and Committees of Congress Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress Summary The planned size of the Navy, the rate of Navy ship procurement, and the prospective affordability of the Navy’s shipbuilding plans have been matters of concern for the congressional defense committees for the past several years. In February 2006, the Navy presented to Congress a goal of achieving and maintaining a fleet of 313 ships, consisting of certain types and quantities of ships. On March 28, 2012, the Department of Defense (DOD) submitted to Congress an FY2013 30-year (FY2013-FY2042) shipbuilding plan that includes a new goal for a fleet of about 310-316 ships. The Navy is conducting a force structure assessment, to be completed later this year, that could lead to a refinement of this 310316-ship plan. The Navy’s proposed FY2013 budget requests funding for the procurement of 10 new battle force ships (i.e., ships that count against the 310-316 ship goal). The 10 ships include one Gerald R. Ford (CVN-78) class aircraft carrier; two Virginia-class attack submarines, two DDG-51 class Aegis destroyers, four Littoral Combat Ships (LCSs), and one Joint High Speed Vessel (JHSV). These ships are all funded through the Shipbuilding and Conversion, Navy (SCN) account. The FY2013-FY2017 five-year shipbuilding plan contains a total of 41 ships—14 ships, or about 25%, less than the 55 ships in the FY2012 five-year (FY2012-FY2016) shipbuilding plan, and 16 ships less, or about 28%, less than the 57 ships that were planned for FY2013-FY2017 under the FY2012 budget. Of the 16 ships no longer planned for FY2013-FY2017, nine were eliminated from the Navy’s shipbuilding plan and seven were deferred to years beyond FY2017. The nine ships that were eliminated were eight Joint High Speed Vessels (JHSVs) and one TAGOS ocean surveillance ship. The seven ships deferred beyond FY2017 were one Virginia-class attack submarine, two LCSs, one LSD(X) amphibious ship, and three TAO(X) oilers. The Navy’s proposed FY2013 budget also proposes the early retirement of seven Aegis cruisers and the placement into Reduced Operating Status (ROS) of two LSD-type amphibious ships. The Navy’s FY2013 30-year (FY2013-FY2042) shipbuilding plan, which was submitted to Congress on March 28, 2012 (more than a month after the submission of the FY2013 budget on February 13, 2012), does not include enough ships to fully support all elements of the Navy’s 310-316 ship goal over the long run. The Navy projects that the fleet would remain below 310 ships during the entire 30-year period, and experience shortfalls at various points in ballistic missile submarines, cruisers-destroyers, attack submarines, and amphibious ships. The projected cruiser-destroyer and attack submarine shortfalls are smaller than they were projected to be under the FY2012 30-year (FY2012-FY2041) shipbuilding plan, due in part to a reduction in the cruiser-destroyer force-level goal and the insertion of additional destroyers and attack submarines into the FY2013 30-year plan. CBO is currently preparing its estimate of the cost of the FY2013 30-year shipbuilding plan. In its June 2011 report on the cost of the FY2012 30-year plan, CBO estimated that the plan would cost an average of $18.0 billion per year in constant FY2011 dollars to implement, or about 16% more than the Navy estimated. CBO’s estimate was about 7% higher than the Navy’s estimate for the first 10 years of the plan, about 10% higher than the Navy’s estimate for the second 10 years of the plan, and about 31% higher than the Navy’s estimate for the final 10 years of the plan. Congressional Research Service Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress Contents Introduction...................................................................................................................................... 1 Background...................................................................................................................................... 1 Navy’s Ship Force Structure Goal ............................................................................................. 1 Newly Announced Goal for Fleet of About 310-316 Ships ................................................ 1 Goal of About 310-316 Ships Is an Interim Target That May Be Refined.......................... 1 Goal for Fleet of About 310-316 Ships Compared to Earlier Goals ................................... 2 Navy’s Five-Year and 30-Year Shipbuilding Plans ................................................................... 3 Five-Year (FY2013-FY2017) Shipbuilding Plan ................................................................ 3 30-Year (FY2013-FY2042) Shipbuilding Plan ................................................................... 6 Navy’s Projected Force Levels Under 30-Year (FY2013-FY2042) Shipbuilding Plan............. 8 Oversight Issues for Congress ....................................................................................................... 11 Future Size and Structure of Navy in Light of Strategic and Budgetary Changes .................. 11 Sufficiency of FY2013 30-Year Shipbuilding Plan ................................................................. 15 Affordability of FY2013 30-Year Shipbuilding Plan .............................................................. 16 Estimated Ship Procurement Costs ................................................................................... 16 Future Shipbuilding Funding Levels................................................................................. 17 Near-Term Options for Adding Ships and Reducing Ship Unit Procurement Costs ............... 17 Adding a Second Virginia Class Boat in FY2014—10 Boats in MYP ............................. 18 Adding a 10th DDG-51 to the DDG-51 MYP.................................................................... 19 Block Buy for CVN-79 and CVN-80................................................................................ 20 Legislative Activity for FY2013 .................................................................................................... 24 FY2013 Funding Request........................................................................................................ 24 FY2013 National Defense Authorization Act (H.R. 4310/S. 3254) ........................................ 24 House................................................................................................................................. 24 Senate ................................................................................................................................ 29 FY2013 DOD Appropriations Act (H.R. 5856)....................................................................... 33 House................................................................................................................................. 33 CRS Reports Tracking Legislation on Specific Navy Shipbuilding Programs ....................... 35 Tables Table 1. Current 310-316 Ship Force Structure Goal Compared to Earlier Goals........................... 2 Table 2. Navy FY2013 Five-Year (FY2013-FY2017) Shipbuilding Plan ....................................... 4 Table 3. Navy FY2013 30-Year (FY2013-FY2042) Shipbuilding Plan .......................................... 7 Table 4. Projected Force Levels Resulting from FY2013 30-Year (FY2013-FY2042) Shipbuilding Plan ......................................................................................................................... 9 Table 5. Recent Study Group Proposals for Navy Ship Force Structure ....................................... 12 Table 6. Navy and CBO Estimates of Cost of FY2012 30-Year (FY2012-FY2041) Shipbuilding Plan ....................................................................................................................... 17 Table C-1. Comparison of Navy’s 310-316 ship goal, Navy Plan from 1993 BUR, and Navy Plan from 2010 QDR Review Panel ................................................................................. 44 Table D-1. Total Number of Ships in the Navy Since FY1948 ..................................................... 47 Congressional Research Service Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress Table D-2. Battle Force Ships Procured or Requested, FY1982-FY2017 ..................................... 48 Appendixes Appendix A. 2012 Testimony on Size of Navy Needed to Fully Meet COCOM Requests........... 36 Appendix B. Using Past Ship Force Levels to Assess Proposed Force Levels ............................. 40 Appendix C. Independent Panel Assessment of 2010 QDR .......................................................... 42 Appendix D. Size of the Navy and Navy Shipbuilding Rate......................................................... 46 Contacts Author Contact Information........................................................................................................... 48 Congressional Research Service Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress Introduction This report provides background information and presents potential issues for Congress concerning the Navy’s ship force-structure goals and shipbuilding plans. The planned size of the Navy, the rate of Navy ship procurement, and the prospective affordability of the Navy’s shipbuilding plans have been matters of concern for the congressional defense committees for the past several years. Decisions that Congress makes on Navy shipbuilding programs can substantially affect Navy capabilities and funding requirements, and the U.S. shipbuilding industrial base. Background Navy’s Ship Force Structure Goal Newly Announced Goal for Fleet of About 310-316 Ships The Navy in February 2006 presented to Congress a goal of achieving and maintaining a fleet of 313 ships, consisting of certain types and quantities of ships. On March 28, 2012, the Department of Defense (DOD) submitted to Congress an FY2013 30-year (FY2013-FY2042) shipbuilding plan that includes a new goal for a fleet of about 310-316 ships. In its report on the FY2013 30year shipbuilding plan, the Navy refers to this new goal as a goal for a Navy of about 300 ships— perhaps in recognition of the ongoing naval force structure assessment discussed below—but the numbers presented in the report add to a target fleet of about 310-316 ships.1 Goal of About 310-316 Ships Is an Interim Target That May Be Refined The goal for a fleet of about 310-316 ships is an interim target that may be further refined in coming months. DOD states that In response to the new strategic priorities and guidance found in [the January 2012 document entitled] Sustaining U.S. Global Leadership: Priorities for 21st Century Defense,2 the Department of Defense is now reviewing and updating the requirements for naval presence and forces and its operational plans for a variety of potential regional contingencies. When these efforts are complete, the DoN [Department of the Navy] will revisit and reassess the force structure judgments and decisions in a supporting Naval Force Structure Assessment (FSA).... This battle force [totaling about 310-316 ships] is fully capable of meeting the strategic guidance found in Sustaining U.S. Global Leadership: Priorities for 21st Century Defense, and adequately sustains the national shipbuilding and naval combat systems design and industrial base. 1 Department of the Navy, Annual Report to Congress on Long-Range Plan for Construction of Naval Vessels for FY2013, April 2012, pp. 4 and 10. 2 For more on this document, see CRS Report R42146, In Brief: Assessing DOD’s New Strategic Guidance, by Catherine Dale and Pat Towell. Congressional Research Service 1 Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress However the battle force inventory above should be considered an interim planning target pending the outcome of a formal Force Struture Assessment (FSA) and the ongoing Department of Defense review of its operational plans for potential regional contingencies. The final FSA-derived inventory targets will remain valid as long as there are no further changes to defense strategic guidance, the global force management allocation plan, or to Department fiscal guidance. Should changes to any of these three things occur, a further review and assessment of battle force requirements will be necessary.3 Goal for Fleet of About 310-316 Ships Compared to Earlier Goals Table 1 compares the 310-316 ship goal to earlier Navy ship force structure plans. Table 1. Current 310-316 Ship Force Structure Goal Compared to Earlier Goals Early-2005 Navy plan for fleet of 260325 ships Ship type Current goal: 310-316 ship plan of March 2012 Revised 313-ship plan of September 2011 Changes to February 2006 313ship plan announced through mid-2011 Ballistic missile submarines (SSBNs) 12-14b 12b 12b 14 Cruise missile submarines (SSGNs) 0-4c 4c 0c Attack submarines (SSNs) ~48 48 11 11e ~90 325ships 20022004 Navy plan for 375-ship Navya 2001 QDR plan for 310-ship Navy 14 14 14 14 4 4 4 4 2 or 4d 48 48 37 41 55 55 11e 11f 10 11 12 12 94 94g 88 67 92 104 0 0 0 0 0 0 0 ~55 55 55 55 63 82 56 0 ~32 33 33h 31 17 24 37 36 0 0j 0j 12i 14i 20i 0i 0i ~29 30 30 30 24 26 42 34 0 0 0 0 0 0 26k 16 Joint High Speed Vessels (JHSVs) 10l 10l 21l 3 0 0 0 0 Otherm ~23 16 24n 17 10 11 25 25 ~310-316 313 328 313 260 325 375 310 or 312 Aircraft carriers Cruisers and destroyers Frigates Littoral Combat Ships (LCSs) Amphibious ships MPF(F) shipsi Combat logistics (resupply) ships Dedicated mine warfare ships Total battle force ships February 2006 Navy plan for 313ship fleet 260-ships Sources: Table prepared by CRS based on U.S. Navy data. Note: QDR is Quadrennial Defense Review. The “~” symbol means approximately and signals that the number in question may be refined as a result of the Naval Force Structure Assessment currently in progress. a. Initial composition. Composition was subsequently modified. 3 Department of the Navy, Annual Report to Congress on Long-Range Plan for Construction of Naval Vessels for FY2013, April 2012, pp. 8 and 10. Congressional Research Service 2 116 Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress b. The Navy plans to replace the 14 current Ohio-class SSBNs with a new class of 12 next-generation SSBNs. For further discussion, see CRS Report R41129, Navy Ohio Replacement (SSBN[X]) Ballistic Missile Submarine Program: Background and Issues for Congress, by Ronald O'Rourke. c. Although the Navy plans to continue operating its four SSGNs until they reach retirement age in the late 2020s, the Navy does not plan to replace these ships when they retire, d. The report on the 2001 QDR did not mention a specific figure for SSGNs. The Administration’s proposed FY2001 DOD budget requested funding to support the conversion of two available Trident SSBNs into SSGNs, and the retirement of two other Trident SSBNs. Congress, in marking up this request, supported a plan to convert all four available SSBNs into SSGNs. e. With congressional approval, the goal will temporarily be reduced to 10 carriers for the period between the retirement of the carrier Enterprise (CVN-65) in November 2012 and entry into service of the carrier Gerald R. Ford (CVN-78), currently scheduled for September 2015. f. For a time, the Navy characterized the goal as 11 carriers in the nearer term, and eventually 12 carriers. g. The 94-ship goal was announced by the Navy in an April 2011 report to Congress on naval force structure and missile defense. h. The Navy acknowledged that meeting a requirement for being able to lift the assault echelons of 2.0 Marine Expeditionary Brigades (MEBs) would require a minimum of 33 amphibious ships rather than the 31 ships shown in the February 2006 plan. For further discussion, see CRS Report RL34476, Navy LPD-17 Amphibious Ship Procurement: Background, Issues, and Options for Congress, by Ronald O'Rourke. i. Today’s Maritime Prepositioning Force (MPF) ships are intended primarily to support Marine Corps operations ashore, rather than Navy combat operations, and thus are not counted as Navy battle force ships. The MPF (Future) ships, however, would have contributed to Navy combat capabilities (for example, by supporting Navy aircraft operations). For this reason, the ships in the planned MPF(F) squadron were counted by the Navy as battle force ships. j. The Navy no longer plans to acquire an MPF(F) squadron. The Navy, however, has procured or plans to procure six ships that were previously planned for the MPF(F) squadron—three modified TAKE-1 class cargo ships, and three Mobile Landing Platform (MLP) ships. These six ships were included in the total shown for “Other” ships. k. The figure of 26 dedicated mine warfare ships included 10 ships maintained in a reduced mobilization status called Mobilization Category B. Ships in this status are not readily deployable and thus do not count as battle force ships. The 375-ship proposal thus implied transferring these 10 ships to a higher readiness status. l. Totals shown include 5 ships transferred from the Army to the Navy and operated by the Navy primarily for the performance of Army missions. m. This category includes, among other things, command ships and support ships. n. The increase in this category from 17 ships under the February 2006 313-ship plan to 24 ships under the apparent 328-ship goal included the addition of one TAGOS ocean surveillance ship and the transfer into this category of six ships—three modified TAKE-1 class cargo ships, and three Mobile Landing Platform (MLP) ships—that were previously intended for the planned (but now canceled) MPF(F) squadron. Navy’s Five-Year and 30-Year Shipbuilding Plans Five-Year (FY2013-FY2017) Shipbuilding Plan Table 2 shows the Navy’s FY2013 five-year (FY2013-FY2017) shipbuilding plan. Congressional Research Service 3 Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress Table 2. Navy FY2013 Five-Year (FY2013-FY2017) Shipbuilding Plan (Battle force ships—i.e., ships that count against 310-316 ship goal) Ship type FY13 FY14 FY15 FY16 FY17 Total Ford (CVN-78) class aircraft carrier 1 1 Virginia (SSN-774) class attack submarine 2 1 2 2 2 9 Arleigh Burke (DDG-51) class destroyer 2 1 2 2 2 9 Littoral Combat Ship (LCS) 4 4 4 2 2 16 1 1 LHA(R) amphibious assault ship Fleet tug (TATF) 2 Mobile Landing Platform (MLP)/Afloat Forward Staging Base (AFSB) Joint High Speed Vessel (JHSV) 1 1 1 1 TAO(X) oiler TOTAL 2 1 10 7 8 9 1 7 41 Source: FY2013 Navy budget submission. Notes: The MLP/AFSB is a variant of the MLP with additional features permitting it to serve in the role of an AFSB. Observations that can be made about the Navy’s proposed five-year (FY2013-FY2017) shipbuilding plan include the following: • Total of 41 ships—16 ships, or 28% less than planned last year. The FY2013FY2017 five-year shipbuilding plan contains a total of 41 ships—14 ships, or about 25%, less than the 55 ships in the FY2012 five-year (FY2012-FY2016) shipbuilding plan, and 16 ships less, or about 28%, less than the 57 ships that were planned for FY2013-FY2017 under the FY2012 budget. • The 16 ships eliminated or deferred. Of the 16 ships that are no longer planned for FY2013-FY2017, nine were eliminated from the Navy’s shipbuilding plan and seven were deferred to years beyond FY2017. The nine ships that were eliminated were eight Joint High Speed Vessels (JHSVs) and one TAGOS ocean surveillance ship. The seven ships that were deferred beyond FY2017 were one Virginia-class attack submarine, two LCSs, one LSD(X) amphibious ship, and three TAO(X) oilers. • Average of 8.2 ships per year. The FY2013-FY2017 plan includes an average of 8.2 battle force ships per year. The previous two five-year shipbuilding plans included an average of 10 or more battle force ships per year. Given the singledigit numbers of battle force ships that were procured from FY1993 through FY2010, shipbuilding supporters for some time have wanted to increase the shipbuilding rate to 10 or more battle force ships per year. The steady-state replacement rate for a fleet of 310-316 ships with an average service life of 35 years is about 8.9-9.0 ships per year. The average shipbuilding rate since FY1993 has been substantially below 8.9-9.0 ships per year (see Appendix D). • Five percent reduction in large combat ships. Although the FY2013-FY2017 five-year shipbuilding plan contains about 28% fewer ships than were planned for FY2013-FY2017 under the FY02012 budget, the percentage reduction in Congressional Research Service 4 Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress large combat ships (defined here as aircraft carriers, submarines, destroyers, and amphibious ships) was much smaller. The total number of large combat ships planned for FY2013-FY2017 dropped from 21 in the FY2012 budget to 20 in the FY2013 budget—a reduction of about 5%. • Two-year stretch-out in aircraft carrier construction. Although the FY2013FY2017 five-year shipbuilding plan retains FY2013 as the year of procurement for the aircraft carrier CVN-79, the FY2013-F23017 plan defers the scheduled delivery date of this ship by two years, to 2022, which is a delivery date that in the past might have been expected for a carrier procured in FY2015. Although it does not show in Table 2, the FY2013 budget also retains FY2018 as the year of procurement for CVN-80, the next carrier after CVN-79. As with CVN-79, the FY2013 budget defers the scheduled delivery date of CVN-80 by two years, to 2027, which is a delivery date that in the past might have been expected for a carrier procured in FY2020. • Virginia-class submarine deferred from FY2014 to FY2018. The FY2013FY017 five-year shipbuilding plan defers one Virginia-class submarine from FY2014 to FY2018. Navy leaders in testimony this year have expressed an interest in finding a way to restore a second Virginia-class submarine to FY014. The Navy this year is also seeking congressional approval for a multiyear procurement (MYP) arrangement4 for the nine Virginia-class boats currently scheduled for procurement in FY2014-FY2018. Adding a second Virginia-class boat to FY2014 would increase to 10 the number of boats that would be procured under the proposed FY2014-FY2018 MYP arrangement. • Start of Ohio-replacement procurement deferred to FY2021. Although it does not show in Table 2, the FY2013 budget defers the scheduled procurement of the first Ohio replacement (SSBN[X]) ballistic missile submarine by two years, from FY2019 to FY2021. • DDG-51 destroyer deferred from FY2014 to FY2016. The FY2013-FY2017 five-year shipbuilding plan defers the scheduled procurement of one DDG-51 destroyer from FY2014 to FY2016. The Navy this year is seeking congressional approval for an MYP arrangement for the nine DDG-51s scheduled for procurement in FY2013-FY2017. • LCS procurement reduced in FY2016-FY2017. The FY2013-FY2017 fiveyear shipbuilding plan reduces the LCS procurement rate in FY2016 and FY2017 from three ships per year to two ships per year. The Navy still plans on procuring a total of 55 LCSs, so the two LCSs that are no longer planned for FY2016 and FY2017 have been deferred beyond FY2017. • LHA(R) amphibious assault ship deferred from FY2016 to FY2017. The FY2013-FY2017 five-year shipbuilding plan defers the scheduled procurement of the next LHA(R) amphibious assault ship by one year, from FY2016 to FY2017. 4 For an explanation of MYP, see CRS Report R41909, Multiyear Procurement (MYP) and Block Buy Contracting in Defense Acquisition: Background and Issues for Congress, by Ronald O'Rourke and Moshe Schwartz. Congressional Research Service 5 Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress • Start of LSD(X) amphibious ship procurement deferred to FY2018. The FY2013-FY2017 five-year shipbuilding plan defers from FY2017 to FY2018 the scheduled procurement of the first LSD(X) amphibious ship. LSD(X)s are to replace aging LSD-41/49 class amphibious ships. The Navy testified last year that an FY2017 start for LSD(X) procurement would have been ahead of need (i.e., earlier than needed) for replacing the first retiring LSD-41/49 class ship. The implication was that the FY2017 start date for the LSD(X) under last year’s budget reflected industrial-base considerations, and that the Navy no longer feels that adequately supporting the industrial base over the next few years requires an FY2017 start date. • AFSB added in FY2014. The FY2013-FY2017 five-year shipbuilding plan adds an Afloat Forward Staging Base (AFSB) ship in FY2014. This ship will be a variant of the Mobile Landing Platform (MLP) ship. The Navy is also proposing to build the third MLP, which was funded in FY2012, to the modified AFSB design, producing an eventual force of two regular MLPs and two AFSBs. The Navy has canceled the retirement of an existing LPD-type amphibious ship and is now modifying that ship to serve as an interim AFSB, pending the delivery of the two new-built AFSBs. • Start of TAO(X) oiler procurement deferred to FY2017. The FY2013-FY2017 five-year shipbuilding plan defers the start of TAO(X) oiler procurement three years, from FY2014 to FY2017. The addition of the AFSB in FY2014 is intended in part to mitigate the industrial-base impact of deferring the start of TAO(X) procurement. • Eight JHSVs eliminated. The elimination of the eight JHSVs from the FY2013FY2017 shipbuilding plan reflects a reduction in the Navy’s JHSV force-level goal from 21 ships down to 10 ships. A total of nine JHSVs have been procured through FY2012; the JHSV requested for FY2013 is to be the 10th and final ship. • Early retirements for seven Aegis cruisers; ROS for two LSD-type amphibious ships. The FY2013 budget also proposes the early retirement of seven Aegis cruisers and the placement into Reduced Operating Status (ROS) of two LSD-41/49 class amphibious ships in FY2013-FY2014. The seven cruisers would await foreign sale or disposal. 30-Year (FY2013-FY2042) Shipbuilding Plan Table 3 shows the Navy’s proposed FY2013 30-year (FY2013-FY2042) shipbuilding plan, which was submitted to Congress on March 28, 2012, more than a month after the submission of the FY2013 budget on February 13, 2012,5 and which includes a total of 268 ships. 5 10 U.S.C. 231, as most recently amended by Section 1011 of the FY2012 National Defense Authorization Act (H.R. 1540/ P.L. 112-81 of December 31, 2011), states that “The Secretary of Defense shall include [the 30-year shipbuilding plan] with the defense budget materials for a fiscal year....” Congressional Research Service 6 Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress Table 3. Navy FY2013 30-Year (FY2013-FY2042) Shipbuilding Plan FY 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 CVN 1 1 1 1 1 1 LSC 2 1 2 2 2 2 2 2 2 2 3 2 3 2 3 2 3 2 2 2 2 2 2 3 3 3 3 3 3 3 SSC 4 4 4 2 2 3 3 3 3 3 3 3 3 3 1 1 1 1 2 3 4 4 4 4 2 SSN 2 1 2 2 2 2 2 3 2 3 2 1 2 1 1 1 1 1 1 1 1 1 1 1 1 2 1 2 1 2 SSBN AWS 1 1 1 1 1 1 2 1 1 1 1 1 1 1 1 1 1 1 2 1 1 1 2 CLF Supt 1 1 1 2 1 1 1 2 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 2 1 2 3 2 1 1 1 2 2 3 2 2 Total 10 7 8 9 7 11 8 12 9 12 13 12 10 9 6 9 8 9 8 11 8 8 5 7 7 10 8 11 8 8 Source: FY2013 30-year (FY2013-FY2042) shipbuilding plan. Key: FY = Fiscal Year; CVN = aircraft carriers; LSC = surface combatants (i.e., cruisers and destroyers); SSC = small surface combatants (i.e., Littoral Combat Ships [LCSs]); SSN = attack submarines; SSGN = cruise missile submarines; SSBN = ballistic missile submarines; AWS = amphibious warfare ships; CLF = combat logistics force (i.e., resupply) ships; Supt = support ships. In devising a 30-year shipbuilding plan to move the Navy toward its ship force-structure goal, key assumptions and planning factors include but are not limited to the following: • ship service lives; • estimated ship procurement costs; • projected shipbuilding funding levels; and • industrial-base considerations. The Navy’s report on the FY2013 30-year shipbuilding plan states that This 30-year shipbuilding plan is based on several key assumptions: Congressional Research Service 7 Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress • The battle force inventory target that forms the basis for the accompanying 30-year shipbuilding report will not change substantially with the Navy Force Structure Assessment or the ongoing Department of Defense review of its operational plans for a variety of potential regional contingencies. Individual ship targets may vary slightly based on a detailed analysis of Combatant Commander requirements in light of the new defense strategy. • Yearly spending on Navy shipbuilding must increase starting in the second FYDP of the near-term period [FY2013-FY2022], and remain at higher levels throughout the midterm planning period [FY2023-FY2032] before falling down to annual shipbuilding levels nearer to historical averages. During the 2020s and early 2030s, a large number of surface ships and submarines built during the Cold War build-up in the 1980s and early 1990s—particularly the OHIO-class SSBNs—will reach the end of their service lives. This will inevitably cause the annual shipbuilding expenditures from FY2020 through FY2032 to be higher than those seen from the mid-1990s through 2020. • All battle force ships—particularly Large Surface Combatants [i.e., cruisers and destroyers]—will serve to the end of their planned or extended service lives. In this fiscal environment, the DoN [Department of the Navy] can ill-afford to inflate future shipbuilding requirements by retiring ships earlier than planned. • The Department of the Navy will be able to maintain cost control over its major shipbuilding acquisition programs, especially once individual ship classes shift to serial production. The Department will need to focus on limiting overruns for first ships-ofclass. • The Department of the Navy must still be able to cover the Manpower, Operations and Maintenance (MPN/O&MN), Weapons Procurement navy (WPN), and Other Procurement Navy (OPN) costs associated with this plan. DoN leaders are committed to avoiding a “hollow force.”6 Navy’s Projected Force Levels Under 30-Year (FY2013-FY2042) Shipbuilding Plan Table 4 shows the Navy’s projection of force levels for FY2013-FY2042 that would result from implementing the FY2013 30-year (FY2013-FY2042) shipbuilding plan shown in Table 3. 6 Department of the Navy, Annual Report to Congress on Long-Range Plan for Construction of Naval Vessels for FY2013, April 2012, p. 19. Italics as in original. Congressional Research Service 8 Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress Table 4. Projected Force Levels Resulting from FY2013 30-Year (FY2013-FY2042) Shipbuilding Plan CVN LSC SSC SSN SSGN SSBN AWS CLF Supt Total 310-316 ship plan 11 ~90 ~55 ~48 0-4 12-14 ~32 ~29 ~33 ~310-316 FY13 10 80 35 55 4 14 31 32 24 285 FY14 10 78 30 55 4 14 29 32 27 279 FY15 11 78 26 54 4 14 28 31 30 276 FY16 11 80 30 53 4 14 29 31 32 284 FY17 11 82 32 50 4 14 30 29 33 285 FY18 11 84 35 51 4 14 31 29 33 292 FY19 11 86 39 51 4 14 31 29 35 300 FY20 11 87 37 48 4 14 31 29 34 295 FY21 11 88 38 48 4 14 31 29 33 296 FY22 12 87 40 47 4 14 32 29 33 298 FY23 11 89 39 47 4 14 32 29 35 300 FY24 11 89 41 46 4 14 34 29 35 303 FY25 11 88 43 45 4 14 34 29 33 301 FY26 11 89 46 45 2 14 34 29 32 302 FY27 12 90 49 44 1 13 33 29 33 304 FY28 11 89 52 43 0 12 34 29 33 303 FY29 11 87 55 43 0 11 33 29 33 302 FY30 11 85 55 43 0 11 33 29 33 300 FY31 11 81 55 45 0 11 32 29 33 297 FY32 11 80 55 45 0 10 32 29 33 295 FY33 11 79 55 46 0 10 33 29 33 296 FY34 11 78 55 47 0 10 34 29 33 297 FY35 11 80 55 48 0 10 33 29 33 299 FY36 11 82 55 49 0 10 33 29 33 302 FY37 11 84 55 50 0 10 33 29 33 305 FY38 11 86 55 48 0 10 32 29 34 305 FY39 11 88 55 49 0 10 32 29 33 307 FY40 10 88 55 49 0 10 31 29 33 305 FY41 10 89 55 48 0 11 32 29 33 307 FY42 10 88 55 49 0 12 31 29 33 307 Source: FY2013 30-year (FY2013-FY2042) shipbuilding plan. Note: Figures for support ships include five JHSVs transferred from the Army to the Navy and operated by the Navy primarily for the performance of Army missions. Key: FY = Fiscal Year; CVN = aircraft carriers; LSC = surface combatants (i.e., cruisers and destroyers); SSC = small surface combatants (i.e., frigates, Littoral Combat Ships [LCSs], and mine warfare ships); SSN = attack submarines; SSGN = cruise missile submarines; SSBN = ballistic missile submarines; AWS = amphibious warfare ships; CLF = combat logistics force (i.e., resupply) ships; Supt = support ships. Congressional Research Service 9 Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress Observations that can be made about the Navy’s FY2013 30-year (FY2013-FY2042) shipbuilding plan and resulting projected force levels include the following: • Total of 268 ships; average of about 8.9 per year. The plan includes a total of 268 ships to be procured, compared to 276 ships in the FY2012 30-year (FY2012-FY2041) shipbuilding plan. The total of 268 ships equates to an average of about 8.9 ships per year, which is the approximate average procurement rate (sometimes called the steady-state replacement rate) that would be needed over the long run to achieve and maintain a fleet of about 310-316 ships, assuming an average life of 35 years for Navy ships. • Projected fleet remains below 310 ships. Although the FY2013 30-year plan includes an average of about 8.9 ships per year, the FY2013 30-year plan, like previous 30-year plans, results in a fleet that does not fully support all elements of the Navy’s ship force structure goal. The distribution of the 268 ships over the 30-year period, combined with the ages of the Navy’s existing ships, results in a projected fleet that would remain below 310 ships during the entire 30-year period and experience shortfalls in ballistic missile submarines, cruisersdestroyers, attack submarines, and amphibious ships. • New projected shortfall in ballistic missile submarines. As a result of the decision in the FY2013 budget to defer the scheduled procurement of the first Ohio replacement (SSBN[X]) ballistic missile submarine by two years, from FY2019 to FY2021, the ballistic missile submarine force is projected to drop to a total of 10 or 11 boats—one or two boats below the 12-boat SSBN force-level goal—during the period FY2029-FY2041. • Smaller projected shortfalls in cruisers-destroyers and attack submarines. The cruiser-destroyer and attack submarine shortfalls under the FY2013 30-year plan are smaller than they were projected to be under the FY2012 30-year plan, due in part to the reduction in the cruiser-destroyer force-level goal to about 90 ships (compared to the previous goal of 94 ships) and the insertion of additional destroyers and attack submarines into the FY2013 30-year plan. • 18 more destroyers and 2 more attack submarines in plan. The FY2013 30-year shipbuilding plan includes 70 destroyers and 46 attack submarines, compared to 52 destroyers and 44 attack submarines in the FY2012 30-year plan. Fifteen of the 18 additional destroyers in the FY2013 plan were added during the final 20 years of the 30-year plan. • Cruiser-destroyer force now projected to bottom out at 78 ships. Under the FY2013 30-year plan, the cruiser-destroyer force is projected to bottom out in FY2014-FY2015 and FY2034 at 78 ships—12 ships, or 13.3% less than the goal of about 90 ships. Under the FY2012 30-year plan, the cruiserdestroyer force was projected to bottom out in FY2034 at 68 ships—26 ships, 27.7% less than the goal under that plan of 94 ships. • Attack submarine force now projected to bottom out at 43 ships. Under the FY2013 30-year plan, the attack submarine force is projected to bottom out in FY2028-FY2030 at 43 ships—5 ships, or 10.4% less than the goal of about 48 boats. Under the FY2012 30-year plan, the attack submarine force was projected to bottom out in FY2030 at 39 boats—9 boats, or 18.8% less than the goal of 48 boats. Congressional Research Service 10 Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress • Shortfall in amphibious ships. The Navy projects that there will be a shortfall of one to four amphibious ships (i.e., 3.1% to 12.5% of the goal of about 32 ships) during the first nine years (FY2013-FY2021) of the 30-year period. Oversight Issues for Congress Future Size and Structure of Navy in Light of Strategic and Budgetary Changes One potential oversight issue for Congress concerns the planned size and structure of the Navy. Changes in strategic and budgetary circumstances have led to a broad debate over the appropriate future size and structure of the military, including the future size and structure of the Navy. Changes in strategic circumstances include, among other things, the winding down of U.S. combat operations in Iraq, the planned winding down of such operations in Afghanistan, and the growth of China’s military capabilities.7 Changes in budgetary circumstances center on reductions in planned levels of defense spending resulting from the Budget Control Act of 2011 (S. 365/P.L. 112-25 of August 2, 2011). On January 5, 2012, the Administration announced that, in light of the winding down of U.S. combat operations in Iraq, the planned winding down of such operations in Afghanistan, and developments in the Asia-Pacific region, U.S. defense strategy in coming years will include a stronger focus on the Asia-Pacific region.8 Since the Asia-Pacific region is to a significant degree a maritime and aerospace theater for the United States, this shift in strategic focus is expected by many observers to result in a shift in the allocation of DOD resources toward the Navy and Air Force. The Navy’s current goal for a fleet of about 310-316 ships reflects a number of assumptions and planning factors, including but not limited to the following: • current and projected Navy missions in support of U.S. military strategy, including both wartime operations and day-to-day forward-deployed operations; • current and projected capabilities of potential adversaries, including their antiaccess/area-denial (A2/AD) capabilities; • regional combatant commander (COCOM) requests for Navy forces; • the individual and networked capabilities of current and future Navy ships and aircraft; • basing arrangements for Navy ships, including numbers and locations of ships homeported in foreign countries; 7 For more on the growth in China’s military (particularly naval) capabilities and its potential implications for required U.S. Navy capabilities, see CRS Report RL33153, China Naval Modernization: Implications for U.S. Navy Capabilities—Background and Issues for Congress, by Ronald O'Rourke. 8 Department of Defense, Sustaining U.S. Global Leadership: Priorities for 21st Century Defense, January 2012, 8 pp. For more on this document, see CRS Report R42146, In Brief: Assessing DOD’s New Strategic Guidance, by Catherine Dale and Pat Towell. Congressional Research Service 11 Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress • maintenance and deployment cycles for Navy ships; and • fiscal constraints. With regard to the third point above, Navy officials have testified at least three times this year that a Navy of more than 500 ships would be required to fully meet COCOM requests for Navy forces (see Appendix A). The difference between a fleet of more than 500 ships and the current goal for a fleet of about 310-316 ships can be viewed as one measure of the operational risk associated with the goal of a fleet of about 310-316 ships. A goal for a fleet of more than 500 ships might be viewed as a fiscally unconstrained goal. Some study groups have made their own proposals for Navy ship force structure. Table 5 shows some of these proposals. For purposes of comparison, Table 5 also shows the Navy’s 310-316 ship goal of March 2012. Table 5. Recent Study Group Proposals for Navy Ship Force Structure Sustainable Defense Task Force (June 2010) Center for a New American Security (CNAS) (November 2008) Center for Strategic and Budgetary Assessments (CSBA) (2008)b Navy’s 310316 ship goal of March 2012 Heritage Foundation (April 2011) Cato Institute (September 2010)a Independent Panel Assessment of 2010 QDR (July 2010) SSBN 12-14 14c 6 14 7 14 12 SSGN 0-4 4 0 4 4 0 2 SSN ~48 55 40 55 37 40 41 CVN 11 11 8 11 9 8 11 CVE 0 0 0 0 0 0 4 ~90 88 22 n/a 18 14 65 n/a 56 73 14 n/a 0 0 9e 4 n/a 25 48 55 0 n/a 0 40 0f Ship type Submarines Aircraft carriers Surface combatants Cruiser Destroyer 0 Frigate LCS ~55 SSC 0 28d 0 85 Amphibious and Maritime Prepositioning Force (Future) (MPF[F]) ships ~32 37 23 n/a 27 36 33 MPF(F) ships 0 0 0 n/a n/a 0 3g LSD station ships 0 0 0 n/a n/a n/a 7h 0 0 0 36 40 Amphibious ships Other: Mine warfare (MIW) ships; Combat logistics force (CLF) ships (i.e., at-sea resupply ships), and support ships 0 14 11 0 CLF ships ~29 33 21 n/a Support ships ~33 25 27 n/a MIW Congressional Research Service 31 31 12 Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress Ship type TOTAL battle force ships Navy’s 310316 ship goal of March 2012 Heritage Foundation (April 2011) Cato Institute (September 2010)a Independent Panel Assessment of 2010 QDR (July 2010) ~310-316 309 241 346 Sustainable Defense Task Force (June 2010) Center for a New American Security (CNAS) (November 2008) Center for Strategic and Budgetary Assessments (CSBA) (2008)b 230 300 326i Source: Table prepared by CRS based on the following sources: For Heritage Foundation: A Strong National Defense[:] The Armed Forces America Needs and What They Will Cost, Heritage Foundation, April 5, 2011, pp. 2526. For Cato Institute: Benjamin H. Friedman and Christopher Preble, Budgetary Savings from Military Restraint, Washington, Cato Institute, September 23, 2010 (Policy Analysis No. 667), pp. 6, 8-10, and additional information provided by Cato Institute to CRS by e-mail on September 22, 2010. For Independent Panel Assessment: Stephen J. Hadley and William J. Perry, co-chairmen, et al., The QDR in Perspective: Meeting America’s National Security Needs In the 21st Century, The Final Report of the Quadrennial Defense Review Independent Panel, Washington, 2010, Figure 3-2 on pages 58-59. For Sustainable Defense Task Force: Debt, Deficits, and Defense, A Way Forward[:] Report of the Sustainable Defense Task Force, June 11, 2010, pp. 19-20. For CNAS: Frank Hoffman, From Preponderance to Partnership: American Maritime Power in the 21st Century. Washington, Center for a New American Security, November 2008. p. 19 (Table 2). For CSBA: Robert O. Work, The US Navy[:] Charting a Course for Tomorrow’s Fleet. Washington, Center for Strategic and Budgetary Assessments, 2008. p. 81 (Figure 5). Notes: n/a is not addressed in the report. SSBN is nuclear-powered ballistic missile submarine; SSGN is nuclear-powered cruise missile and special operations forces submarine; SSN is nuclear-powered attack submarine; CVN is large nuclear-powered aircraft carrier; CVE is medium-sized aircraft carrier; LCS is Littoral Combat Ship; SSC (an acronym created by CRS for this table) is small surface combatant of 1,000+ tons displacement—a ship similar to late-1990s Streetfighter concept; MPF(F) is Maritime Prepositioning Force (Future) ship; LSD is LSD-41/49 class amphibious ship operating as a station ship for a formation like a Global Fleet Station (GFS); MIW is mine warfare ship; CLF is combat logistics force (i.e., resupply) ship. a. Figures shown are for the year 2020; for subsequent years, reductions from these figures would be considered. b. Figures shown are for the year 2028. c. The report calls for a force of 280 SLBMs, which appears to equate to a force of 14 SSBNs, each with 20 SLBM tubes. d. The report calls for a force of 28 small surface combatants, and appears to use the term small surface combatants the same way that the Navy does in the 30-year shipbuilding plan—as a way of collectively referring to frigates and LCSs. The small surface combatants (SSCs) called for in the November 2008 CNAS report are separate from and smaller than the LCS. e. Maritime Security Frigates. f. Plan includes 28 patrol craft (PCs) of a few hundred tons displacement each, as well as 29 boat detachments and seven riverine squadrons. g. Plan shows three Mobile Landing Platform (MLP) ships that the Navy currently plans for the MPF(F) squadron, plus 16 existing current-generation maritime prepositioning force (MPF) ships and 17 existing prepositioning ships for Army and other service/agency equipment. Plan also shows 67 other DOD sealift ships. h. T-LSDs, meaning LSDs operated by the Military Sealift Command (MSC) with a partly civilian crew. i. The CSBA report shows a total of 488 units by including 162 additional force units that do not count toward the 310-316 ship goal under the battle force ships counting method that has been used since the early 1980s for public policy discussions of the size of the Navy. These 162 additional force units include 16 existing current-generation maritime prepositioning force (MPF) ships and 17 existing prepositioning ships for Army and other service/agency equipment, 67 other DOD sealift ships, 28 PCs, 29 boat detachments, and certain other small-scale units. The CSBA report proposes a new counting method for naval/maritime forces that includes units such as these in the total count. Congressional Research Service 13 Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress A potential key question for Congress concerns whether the U.S. Navy in coming years will be large enough to adequately counter improved Chinese maritime anti-access forces while also adequately performing other missions of interest to U.S. policymakers around the world. Some observers are concerned that a combination of growing Chinese naval capabilities and budgetdriven reductions in the size of the U.S. Navy could encourage Chinese military overconfidence and demoralize U.S. allies and partners in the Pacific, and thereby make it harder for the United States to defend its interests in the region.9 Potential oversight questions for Congress include the following: • Under the Administration’s plans, will the Navy in coming years be large enough to adequately counter to adequately counter improved Chinese maritime antiaccess forces while also adequately performing other missions of interest to U.S. policymakers around the world? • What might be the political and security implications in the Asia-Pacific region of a combination of growing Chinese naval capabilities and budget-driven reductions in the size of the U.S. Navy? • Are the proposed early retirements of nine Aegis cruisers and the placing of two LSD-41/49 class amphibious ships into Reduced Operating Status (ROS) consistent with the stronger focus on the Asia-Pacific region in DOD’s new strategic guidance? What are the potential operational implications of these early retirements? What steps, if any are being taken to preserve a potential for reactivating these nine ships, should circumstances warrant their reactivation? • If the Navy is reduced in size and priority is given to maintaining Navy forces in the Pacific, what will be the impact on Navy force levels in other parts of the world, such as the Persian Gulf/Indian Ocean region or the Mediterranean Sea, and consequently on the Navy’s ability to adequately perform its missions in those parts of the world? • To what extent could the operational impacts of a reduction in Navy ship numbers be mitigated through increased use of forward homeporting, multiple crewing, and long-duration deployments with crew rotation (i.e., “Sea Swap”)? How feasible are these options, and what would be their potential costs and benefits? • Particularly in a situation of constrained DOD resources, if enough funding is allocated to the Navy to permit the Navy in coming years to maintain a fleet of about 310-316 ships including 11 aircraft carriers, how much would other DOD programs need to be reduced, and what would be the operational implications of those program reductions in terms of DOD’s overall ability to counter improved Chinese military forces and perform other missions?10 9 See, for example, Dan Blumenthal and Michael Mazza, “Asia Needs a Larger U.S. Defense Budget,” Wall Street Journal, July 5, 2011; J. Randy Forbes, “Defence Cuts Imperil US Asia Role,” The Diplomat (http://the-diplomat.com), October 26, 2011. See also Andrew Krepinevich, “Panetta’s Challenge,” Washington Post, July 15, 2011: 15; Dean Cheng, Sea Power and the Chinese State: China’s Maritime Ambitions, Heritage Foundation Backgrounder No. 2576, July 11, 2011, p. 10. 10 For further discussion, see CRS Report RL33153, China Naval Modernization: Implications for U.S. Navy Capabilities—Background and Issues for Congress, by Ronald O'Rourke. Congressional Research Service 14 Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress Sufficiency of FY2013 30-Year Shipbuilding Plan Another potential oversight issue for Congress concerns the sufficiency of the FY2013 30-year (FY2012-FY2041) shipbuilding plan. As discussed earlier (see “Navy’s Projected Force Levels Under 30-Year (FY2013-FY2042) Shipbuilding Plan”), the plan does not include enough ships to fully support all elements of the 310-316 ship goal over the long run. The Navy projects that the fleet would remain below 310 ships during the entire 30-year period and experience shortfalls at various points in ballistic missile submarines, cruisers-destroyers, attack submarines, and amphibious ships. Although the projected cruiser-destroyer and attack submarine shortfalls are smaller under the FY2013 30-year plan than they were under the FY2012 30-year plan, the shortfalls in ballistic missile submarines, cruisers-destroyers, attack submarines, and amphibious ships projected under the FY2013 30-year plan could make it difficult for the Navy to fully perform its projected missions in certain years. In light of these projected shortfalls, policymakers may wish to consider various options, including but not limited to the following: • keeping in active service some or all of the seven Aegis cruisers that the Navy’s FY2013 budget proposes for early retirement, and/or the two LSD-41/49 class amphibious ships that the Navy’s FY2013 budget proposes shifting to Reduced Operating Status (ROS); • increasing planned procurement quantities of destroyers and attack submarines, perhaps particularly in years prior to the start of SSBN(X) procurement; and • extending the service lives of older destroyers to 40 or 45 years, and refueling a small number of older attack submarines and extending their service lives to 40 or more years. The Navy estimates that keeping in service the seven Aegis cruisers proposed for early retirement would cost a total of a little more than $4 billion over the period FY2013-FY2017. This figure includes costs for conducting maintenance and modernization work on the ships during those years, for operating the ships during those years (including crew costs), and for procuring, crewing, and operating during those years helicopters that would be embarked on the ships.11 Regarding the third option above, possible candidates for service life extensions include the first 28 DDG-51 destroyers (i.e., the Flight I/II DDG-51s), the final 23 Los Angeles (SSN-688) attack submarines (i.e., the Improved 688s), and the 3 Seawolf (SSN-21) class attack submarines. Whether such service life extensions would be technically feasible or cost-effective is not clear. Feasibility would be a particular issue for the attack submarines, given limits on submarine pressure hull life. Extending the service lives of any of these ships could require increasing funding for their maintenance, possibly beginning in the near term, above currently planned levels, so that the ships would be in good enough condition years from now to remain eligible for service life extension work. Such funding increases would be in addition to those the Navy has recently 11 Source: Transcript of spoken testimony of Vice Admiral William Burke, Deputy Chief of Naval Operations, Fleet Readiness and Logistics, before the Readiness subcommittee of the House Armed Services Committee, March 22, 2012. Congressional Research Service 15 Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress programmed for ensuring that its surface ships can remain in service to the end of their currently planned service lives. As mentioned earlier, the Navy’s 30-year shipbuilding plan is based on certain assumptions, including assumptions about ship service lives. The Navy in past years has, for various reasons, retired numerous ships, including surface combatants and attack submarines, well before the ends of their expected service lives. Many of these retirements were due the decision to reduce the size of the Navy following the end of the Cold War. Other instances were due to the material condition of the ships or the projected costs of keeping them mission-effective through the ends of their service lives. If ship service lives in some cases turn out to be shorter than assumed under the 30year plan, than Navy ship force levels will be smaller in certain years than shown in Table 4. Affordability of FY2013 30-Year Shipbuilding Plan Another potential oversight issue for Congress concerns the prospective affordability of the FY2013 30-year (FY2013-FY2042) shipbuilding plan. In assessing the prospective affordability of the FY2013 30-year shipbuilding plan, key factors that Congress may consider include estimated ship procurement costs and future shipbuilding funding levels. Estimated Ship Procurement Costs As mentioned earlier, the Navy’s 30-year shipbuilding plan is based on certain assumptions, including assumptions about ship procurement costs. If one or more Navy ship designs turn out to be more expensive to build than the Navy estimates, then the projected funding levels shown in the 30-year shipbuilding plan will not be sufficient to procure all the ships shown in the plan. Ship designs that can be viewed as posing a risk of being more expensive to build than the Navy estimates include Gerald R. Ford (CVN-78) class aircraft carriers (a program currently experiencing cost growth), Ohio-replacement (SSBNX) class ballistic missile submarines, the Flight III version of the DDG-51 destroyer, and the LSD(X) amphibious ship. In recent years, the Congressional Budget Office (CBO) has estimated that certain Navy ships would be more expensive to procure than the Navy estimates, and consequently that the Navy’s 30-year shipbuilding plan would cost more to implement than the Navy has estimated. CBO is currently preparing its estimate of the cost of the FY2013 30-year shipbuilding plan. In its June 2011 report on the cost of the FY2012 30-year plan, CBO estimated that the plan would cost an average of $18.0 billion per year in constant FY2011 dollars to implement, or about 16% more than the Navy estimated. CBO’s estimate was about 7% higher than the Navy’s estimate for the first 10 years of the plan, about 10% higher than the Navy’s estimate for the second 10 years of the plan, and about 31% higher than the Navy’s estimate for the final 10 years of the plan.12 Some of the difference between CBO’s estimate and the Navy’s estimate, particularly in the latter years of the plan, was due to a difference between CBO and the Navy in how to treat inflation in Navy shipbuilding. Table 6 summarizes the Navy and CBO estimates of the FY2012 30-year shipbuilding plan, as presented in the June 2011 CBO report. 12 Congressional Budget Office, An Analysis of the Navy’s Fiscal Year 2012 Shipbuilding Plan, June 2011, Table 2 (page 9). Congressional Research Service 16 Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress Table 6. Navy and CBO Estimates of Cost of FY2012 30-Year (FY2012-FY2041) Shipbuilding Plan Funding for new-construction ships, in billions of constant FY2011 dollars First 10 years (FY2012-FY2021) Next 10 years (FY2022-2031) Final 10 years (FY2032-FY2041) Entire 30 years (FY2012-FY2041) Navy estimate 14.6 17.2 14.7 15.5 CBO estimate 15.7 19.0 19.2 18.0 % difference between Navy and CBO estimates 7% 10% 31% 16% Source: Congressional Budget Office, An Analysis of the Navy’s Fiscal Year 2012 Shipbuilding Plan, June 2011, Table 2 (Page 9). Future Shipbuilding Funding Levels As mentioned earlier, the Navy’s 30-year shipbuilding plan is based on certain assumptions, including assumptions about future shipbuilding funding levels. It has been known for some time that funding requirements for the Ohio-replacement (SSBN[X]) ballistic missile submarine program will put considerable pressure on the shipbuilding budget during the middle years of the 30-year plan. Although the FY2013 30-year shipbuilding plan reduces procurement of other types of ships in the middle years of the plan to help accommodate the SSBN(X) program, the Navy still projects that the shipbuilding budget would need to be substantially higher during the middle 10 years of the plan than during the first or last 10 years of the plan. The Navy estimates that, in constant FY2012 dollars, implementing the FY2013 30-year shipbuilding plan would require an average of $15.1 billion per year during the first 10 years of the plan, $19.5 billion per year during the middle 10 years of the plan, and $15.9 billion per year during the final 10 years of the plan. The figure of $19.5 billion per year for the middle 10 years of the plan is about 26% higher than the average of $15.5 billion per year for the first and last 10 years of the plan. If the “hump” in shipbuilding funding during the middle 10 years of the 30-year plan is not achieved, numerous ships shown for procurement during the middle 10 years of the plan might not be procured. A potential oversight question for Congress is whether the Navy has received a commitment or assurance of some kind from DOD leaders that the Navy will be able to budget for the “hump” in shipbuilding funding during the middle years of the 30-year plan without reducing funding for other Navy program priorities. Near-Term Options for Adding Ships and Reducing Ship Unit Procurement Costs Congressional review to date of the Navy’s FY2013 5-year and 30-year shipbuilding plans have included, among other things, discussion of near-term options for adding ships to the plan and reducing ship unit procurement costs. These options include the following: • adding a second Virginia-class attack submarine to FY2014 and, as a consequence, increasing to 10 the number of Virginia-class submarines procured under the proposed FY2014-FY2018 multiyear procurement (MYP) arrangement for the Virginia-class program; Congressional Research Service 17 Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress • adding a 10th DDG-51 destroyer to the proposed FY2013-FY2017 MYP arrangement for the DDG-51 program; and • procuring the aircraft carriers CVN-79 and CVN-80 under a block buy arrangement. The first two options could mitigate operational risks associated with the projected cruiserdestroyer and attack submarine shortfalls. The third option could reduce the cost of implementing the 30-year shipbuilding plan. Adding a Second Virginia Class Boat in FY2014—10 Boats in MYP Navy officials have testified this year that the second Virginia-class boat that had been programmed for FY2014 was deferred to FY2018 in the FY2013 budget submission because FY2014 has become a tight budget year for the Navy, and that the Navy is interested in finding a way, if possible, to restore the procurement of a second Virginia-class boat to FY2014.13 The question of whether to procure a second boat in FY2014 is an issue for FY2013 because procuring a second boat in FY2014 could involve adding advance procurement funding for that boat in FY2013. The Navy has testified that procuring a second boat in FY2014 could require about $777 million in advance procurement funding in FY2013 (and a balance of more than $1.2 billion in FY2014).14 Providing advance procurement funding for the boat in FY2013 would permit the boat to be constructed on a schedule that is more-or-less consistent with what one might expect for a boat procured in FY2014. Adding advance procurement funding in FY2013, however, is not absolutely required to procure a second boat in FY2014—the boat can be procured in FY2014 without any advance procurement funding in FY2013. Doing so might result in the boat being built on a schedule closer to what one might expect for a boat procured in FY2015, but the boat would still enter service years earlier than it would if it is procured in FY2018. Finding a way to procure a second Virginia-class boat in FY2014 could involve the use of incremental funding (as opposed to full funding) in the Virginia-class program, at least for the second boat in FY2014, if not also for one or more other Virginia-class boats. Incrementally funding a second boat in FY2014 would involve providing some of the boat’s procurement cost in FY2014 and deferring the remainder to one or more subsequent years. Incremental funding is normally used only for procuring aircraft carriers and LHD/LHA-type amphibious assault ships,15 but there have been rare cases when individual ships of other types have, for various reasons, been procured with incremental funding. Examples include the third 13 See, for example, the spoken testimony of Secretary of the Navy Ray Mabus to the House Armed Services Committee on February 16, 2012. 14 Source: Spoken testimony of Sean Stackley, Assistant Secretary of the Navy for Research, Development, and Acquisition, at an April 19, 2012, hearing before the Seapower subcommittee of the Senate Armed Services Committee, as reflected in the transcript of the hearing. 15 Incremental funding is allowed for procuring aircraft carriers and LHD/LHA-type amphibious assault ships because using full funding to procure these ships—which are very expensive and which are procured once every several years—can cause a one-year “spike” in Navy shipbuilding funding requirements that can be disruptive to other acquisition programs. Congressional Research Service 18 Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress and final Seawolf (SSN-21) class attack submarine, whose procurement was reinstated in FY1996, and each of the three Zumwalt (DDG-1000) class destroyers that were procured in FY2007-FY2009.16 It can also be noted that ships procured through the National Defense Sealift Fund (NDSF)—including DOD sealift ships and Navy auxiliary ships—in practice are frequently acquired with incremental funding, even though they are nominally funded by Congress with full funding.17 The Navy estimates that adding a second Virginia-class boat to FY2014 and increasing to 10 the number of boats in the proposed MYP arrangement would reduce by roughly $700 million the total cost of the other 9 boats in the arrangement.18 The reduction in cost would come from maintaining a smooth, two-per-year production rate at the GD/EB and NNS, from increased spreading of fixed overhead costs at the shipyards, and from reduced costs for components procured from suppliers in batches of 10 rather than batches of 9. Since the figure of roughly $700 million is roughly equivalent to one-quarter the cost of a Virginia-class submarine, the Navy, in effect, is estimating that adding a second Virginia-class boat to FY2014 and increasing to 10 the number of boats in the proposed MYP arrangement would be roughly 25% selffinancing. Adding a 10th DDG-51 to the DDG-51 MYP Regarding the possibility of adding a 10th DDG-51 to the proposed FY2013-FY2017 MYP arrangement for the DDG-51 program, Sean Stackley, the Assistant Secretary of the Navy for Research, Development, and Acquisition (i.e., the Navy’s acquisition executive), stated the following at a March 29, 2012, hearing on Navy shipbuilding programs before the Seapower and Projection Forces subcommittee, in response to a question about the FY2013 budget’s deferral to FY2016 of a second DDG-51 that was previously programmed for FY2014: I’d like to address the question regarding the second destroyer in 2014. A couple of important facts: First, the—we restarted DDG-51 construction in—in [FY]2010 and we’ve got four ships under contract, and a result of the four ships that we’ve placed under contract is we have prior year savings in this program that are—work in our favor when we consider future procurement for the [DDG-]51s. We also have a unique situation where we’ve got competition on this program—two builders building the 51s, and the competition has been healthy with both builders. We also have a very significant cost associated with government-furnished equipment, so not only did we restart construction at the shipyards, we also restarted manufacturing lines at our weapon systems providers. So in this process we were able to restart 51s virtually without skipping a beat, and we’re seeing the continued learning curve that we left off on back with the [FY]2005 procurement. 16 The first two DDG-1000s were procured in FY2007 and split-funded (i.e., funded with two-year incremental funding) in FY2007-FY2008. The third DDG-1000 was procured in FY2009 and split-funded in FY2009-FY2010. 17 DOD sealift ships and Navy auxiliary ships can be acquired this way because the full funding provision does not apply to ships procured through the NDSF the same way that it applies to ships funded through the Shipbuilding and Conversion, Navy (SCN) appropriation account. For a discussion, see CRS Report RL31404, Defense Procurement: Full Funding Policy—Background, Issues, and Options for Congress, by Ronald O'Rourke and Stephen Daggett, and CRS Report RL32776, Navy Ship Procurement: Alternative Funding Approaches—Background and Options for Congress, by Ronald O'Rourke. 18 Source: Navy briefing to CRS and Congressional Budget Office (CBO), March 16, 2012. Congressional Research Service 19 Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress So when we march into this third multiyear for the 51s we’re looking to capitalize on the same types of savings that we saw prior, and our top line, again, allowed for nine ships to be budgeted, but when we go out with this procurement we’re going to go out with a procurement that enables the procurement of 10 ships, where that 10th ship would be the second—potentially the second ship in [FY]2014 if we’re able to achieve the savings that we’re targeting across this multiyear between the shipbuilders in competition as well as the combat systems providers as well as all of the other support and engineering associated with this program. So we want to leverage the strong learning, we want to leverage the strong industrial base, we want to leverage the competition to get to what we need in terms of both affordability and force structure, and I think we have a pretty good shot at it.19 Block Buy for CVN-79 and CVN-80 The Navy currently plans to procure the aircraft carriers CVN-79 and CVN-80 separately, as oneship procurements. Procuring the two ships together in a block buy could reduce their combined procurement cost. Procuring two aircraft carriers together in a two-ship block buy has been done on two previous occasions. The Navy procured two Nimitz (CVN-68) class aircraft carriers (CVN-72 and CVN-73) together in a block buy in FY1983, and procured another two Nimitzclass aircraft carriers (CVN-74 and CVN-75) together in a block buy in FY1988. The Navy proposed these block buys in the FY1983 and FY1988 budget submissions.20 When the FY1983 block buy was proposed, the Navy estimated that the block buy would reduce the combined cost CVN-72 and CVN-73 by 5.6% in real terms.21 When the FY1988 block buy was proposed, the Navy estimated that the block buy would reduce the combined cost of CVN-74 and CVN-75 by a considerably larger percentage. GAO testified that the savings would be considerably less than the Navy estimated, but agreed that a two-ship acquisition strategy is less expensive than a single-ship acquisition strategy, and that some savings would occur in a twoship strategy for CVN-74 and CVN-75.22 19 Source: Transcript of hearing. See also Megan Eckstein, “Navy Looking Into Feasibility Of Procuring 10th DDG In Multiyear Contract,” Inside the Navy, April 2, 2012. 20 It can also be noted that the Air Force is procuring two Advanced EHF (AEHF) satellites under a two-satellite block buy that the Air Force proposed and Congress approved in FY2012. 21 See General Accounting Office, Request to Fully Fund Two Nuclear Aircraft Carriers in Fiscal Year 1983, MASAD-82-87 (B-206847), March 26, 1982, 10 pp. The figure of 5.6 was derived by dividing $450 million in noninflation cost avoidance shown on page 5 by the combined estimated cost of the two ships (absent a block buy) of $8,024 million shown on page 4. 22 See General Accounting Office, Procurement Strategy For Acquiring Two Nuclear Aircraft Carriers, Statement of Frank Conahan, Assistant Comptroller General, National Security and International Affairs Division, Before the Conventional Forces and Alliance Defense Subcommittee and Projection Forces and Regional Defense Subcommittee of the Senate Armed Services Committee, April 7, 1987, T-NSIAD-87-28, 5 pp. The testimony states on page 2 that “A single ship acquisition strategy is more expensive because materials are bought separately for each ship rather than being combined into economic order quantity buys under a multi-ship procurement.” The testimony discounted the Navy’s estimated savings of $1,100 million based on this effect on the grounds that if CVN-74 and CVN-75 were not procured in the proposed two-ship block buy, with CVN-74 procured in FY1990 and CVN-75 procured FY1993, it was likely that CVN-74 and CVN-75 would subsequently be procured in a two-ship block buy, with CVN-74 procured in FY1994 and CVN-75 procured in FY1996. For the discussion here, however, the comparison is between the Navy’s current plan to procure CVN-79 and CVN-80 separately and the potential alternative of procuring them together in a block buy. The GAO testimony commented on an additional $700 million in savings that the Navy estimated would be derived (continued...) Congressional Research Service 20 Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress The FY1983 and FY1988 block buys each involved procuring two aircraft carriers in a single year. Procuring two carriers in the same year, however, is not mandatory for a two-ship aircraft carrier block buy. The Navy, for example, proposed the block buy for CVN-74 and CVN-75 in the FY1988 budget submission as something that would involve procuring CVN-74 in FY1990 and CVN-75 in FY1993. (Congress, in acting on the FY1988 budget, decided to not only approve the two-ship block buy, but also accelerate the procurement of both CVN-74 and CVN-75 to FY1988.23) A block buy on CVN-79 and CVN-80 could leave intact the FY2013 procurement date for CVN-79 and the FY2018 procurement date for CVN-80. This would permit the funding for the two ships to be spread out over the same fiscal years as currently planned, although the amounts of funding in individual years would likely change. It is too late to implement a complete block buy on CVN-79 and CVN-80, because some of CVN79, particularly its propulsion plant, has already been purchased. Consequently, the option would be to implement a partial block buy that would include the remaining part of CVN-79 and all of CVN-80. To illustrate the notional scale of the savings that might result from using a block buy strategy on CVN-79 and CVN-80, it can be noted that if such a block buy were to achieve one-third as much percentage cost reduction as the FY1983 block buy—that is, if it were to reduce the combined procurement cost of CVN 79 and 80 by about 1.9%—that would equate to a savings of roughly $470 million on the currently estimated combined procurement cost of CVN-79 and CVN-80. More refined estimates might be higher or lower than this notional figure of $470 million. At a March 19, 2012, briefing for CRS and CBO on the CVN-78 program, CRS asked the Navy whether it was considering the possibility of a block buy on CVN-79 and CVN-80. The Navy stated that it had looked into a narrower option of doing joint purchases of some materials for the two ships. CRS asked the Navy to examine the broader option of a block buy along the lines described above, and to inform CRS and CBO of the Navy’s estimate of how much it might reduce the combined procurement cost of CVN-79 and CVN-80. Implementing a block buy on CVN-79 and CVN-80 would require committing to the procurement of CVN-80. Whether Congress would want to commit to the procurement of CVN80, particularly in light of current uncertainty over future levels of defense spending, is a factor that Congress may consider in assessing the option of doing a block buy. If budgetary (...continued) from improving production continuity between CVN-73, CVN-74, and CVN-75 by stating on page 3 that “It is logical to assume that savings are possible through production continuity but the precise magnitude of such savings is difficult to calculate because of the many variables that affect the outcome.” It is not clear how significant savings from production continuity might be in a two-ship block buy for CVN-79 and CVN-80 if the procurement dates for the two ships (FY2013 and FY2018, respectively) are not changed. The GAO testimony noted that the Navy estimated $500 million in additional savings from avoided configuration changes on CVN-74 and CVN-75 if the ships were procured in FY1990 and FY1993 rather than FY1994 and FY1996. It is not clear how significant the savings from avoided configuration changes might be for a two-ship block buy for CVN-79 and CVN-80. See also CRS Issue Brief IB87043, Aircraft Carriers (Weapons Facts), 13 pp., updated February 10, 1988 and archived March 24, 1988, by Ronald O’Rourke. The report includes a discussion of the above GAO testimony. The CRS report is out of print and available directly from the author. 23 See CRS Issue Brief IB87043, Aircraft Carriers (Weapons Facts), 13 pp., updated February 10, 1988 and archived March 24, 1988, by Ronald O’Rourke. The report is out of print and available directly from the author. Congressional Research Service 21 Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress circumstances were to lead to a decision to end procurement of Ford-class carriers after CVN-79, then much or all of the funding spent procuring materials for CVN-80 could go to waste. At a March 29, 2012, hearing on Navy shipbuilding programs before the Seapower and Projection Forces subcommittee of the House Armed Services Committee, Sean Stackley, the Assistant Secretary of the Navy for Research, Development, and Acquisition (i.e., the Navy’s acquisition executive), stated the following when asked by Representative Robert Wittman about the possibility of a two-ship block buy on CVN-79 and CVN-80: Yes, sir. Let me focus on affordability of the CVN-78 class. We are right now about 40 percent complete construction of the CVN-78 and we’re running into some very difficult cost growth issues across the full span—design, material procurement, and production— material procurement on both contractor and government side. So our first focus right now is to stabilize the lead ship. Let’s get cost under control so we can complete this ship as close to schedule at the lowest cost possible. But in parallel, the Navy is working very closely with the shipbuilder to take a step back and say, one, what are all the lessons we just learned on CVN-78? Two, CVN-78 is a very different ship from the Nimitz [CVN-68]; we cannot expect to build the [CVN-]78 the way we build the [CVN-]68 and—and get to an affordable ship construction plan. So we’re pressing on the way the carrier is built—the build plan for the carrier—to arrive at a more affordable CVN-79. Now, in the process of doing that we’ll take a hard look at what opportunity there is across [CVN-]79 and [CVN-]80, recognizing that we’re going to be limited, again, by [budget] top line. But there are going to be some opportunities that jump out at us. We don’t want to have to replan each carrier. We have a vendor base that is stretched out with the carrier build cycle that for some components that are carrier-unique, that vendor base is—is just struggling to hold on between the five-year gaps. So we have to take a hard look at where does it make sense after we’ve gotten to what I’m calling an optimal build plan for CVN-79 and then be able to come back and—and say, OK, here—on CVN-79 here are some opportunities that if we could, in fact, reach out to CVN-80 we can either avoid a gap in a production line or avoid unnecessary cost growth on that follow ship.24 Later in the hearing, the following exchange occurred: REPRESENTATIVE RICK LARSEN: Finally, we had some discussion about this question with regard to CVNs and trying to find a way to squeeze some costs out, and one of the ideas was to do some—do block buy of certain components of—of—of CVN components. And have you considered that, and what’s your thought on that on block buy on components from [CVN-]79 to [CVN-]80, or whatever, [CVN-]79, [CVN-]79 to [CVN-]80, and so on? ASSISTANT SECRETARY OF THE NAVY SEAN STACKLEY: 24 Source: Transcript of hearing. Congressional Research Service 22 Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress Yes, sir. At this point in time the Navy and the shipbuilder are sitting side by side putting together a build plan for CVN-79. We’re 40 percent complete construction of the [CVN-]78; we’ve got a lot that we’ve got to, I’ll say, do different on the [CVN-]79 and follow from the lead ship. It’s a very different ship class [compared to the Nimitz class]. So we’re taking a hard look at the build plan [for CVN-78]. We need to get that locked down. And associated with that is the complete bill of materials for the Ford class. At that point in time we'll be able to take a look at... LARSEN: On this, call it bill of materials, what does it make sense—what makes sense in terms of looking long term, beyond the immediate ship? STACKLEY: Right. LARSEN: Are there areas of the industrial base that are stressed to the point that it does make sense to look at coupling the CVN-79 and CVN-80 buy? STACKLEY: We’re not at that point yet. I described earlier that I think after we get through this build plan review then we’ll be able to come back in ‘14 [FY2014] and identify potential critical items that warrant a block buy approach.25 Later in the hearing, Matthew Mulherin, President of NNS and Corporate Vice President of HII, stated the following when asked by Representative Robert Wittman about the possibility of a twoship block buy on CVN-79 and CVN-80: Yes, sir. You know, historically you go back, you were exactly right, if you look at the contracts that bought the CVN- 72 and [CVN-]73 there was huge savings that flowed to the second ship, both in the ability to go buy materials, a block buy and get—get discounts there, but also that you did the engineering up front the first time for both hulls so the second ship you really just had the answer, problem, paper [sic] and some of those kind of things the— the kind of the normal course of business to support the waterfront. So I wouldn’t see any different. I think if we were able to do it both for material, for—for the engineering to be able to go pump out drawings that had two-ship applicability—plus, I think it brings the—the—the CVN—if we were to do a two-ship buy for [CVN-]79 and [CVN-]80 it would ensure CVN-80 was a copy of CVN-79, no change into the contract or very minimal, you’re not having a—on the material side you get economic order savings, you don’t have to deal with obsolescence. So absolutely. I think there’s huge opportunity to go do that. You know, you talk to the—the vendor base. They would love to see it. It gives them the ability to go look at—at what 25 Source: Transcript of hearing. Congressional Research Service 23 Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress investments they need, what work is out in front of them, and go invest in—in training and tools to—to be able to go support that.26 Legislative Activity for FY2013 FY2013 Funding Request The Navy’s proposed FY2013 budget requests funding for the procurement of 10 new battle force ships (i.e., ships that count against the 310-316 ship goal). The 10 ships include one Gerald R. Ford (CVN-78) class aircraft carrier; two Virginia-class attack submarines, two DDG-51 class Aegis destroyers, four Littoral Combat Ships (LCSs), and one Joint High Speed Vessel (JHSV). These ships are all funded through the Shipbuilding and Conversion, Navy (SCN) account. FY2013 National Defense Authorization Act (H.R. 4310/S. 3254) House The House Armed Services Committee, in its report (H.Rept. 112-479 of May 11, 2012) on H.R. 4310, recommended approving the Navy’s requests for procurement funding for all 10 new battle force ships requested for procurement in FY2013. The committee also recommended an additional $778 million in FY2013 advance procurement funding to support the procurement of an additional Virginia-class attack submarine in FY2014, and an additional $115 million in FY2013 advance procurement funding for the DDG-51 destroyer program. (Page 375) Section 121 of H.R. 4310 as reported would prohibit the Navy from retiring or decommissioning a nuclear-powered ballistic missile submarine (SSBN) if such retirement or decommissioning would reduce the SSBN force to less than 12 boats. Section 122 would provide authority for using six-year incremental funding to procure the aircraft carriers CVN-79 and CVN-80. Sections 125 and 126 would authorize new multiyear procurement (MYP) arrangements for the DDG-51 destroyer and Virginia-class attack submarine programs, respectively. Sections 128 and 129 require reports from the Navy and GAO, respectively, on the LCS program The texts of these provisions and report language associated with these provisions are presented in the CRS reports on these individual programs (see “CRS Reports Tracking Legislation on Specific Navy Shipbuilding Programs” below). Section 130 of H.R. 4310 as reported states: SEC. 130. SENSE OF CONGRESS ON IMPORTANCE OF ENGINEERING IN EARLY STAGES OF SHIPBUILDING. It is the sense of Congress that— (1) placing a priority on engineering dollars in the early stages of shipbuilding programs is a vital component of keeping cost down; and 26 Source: Transcript of hearing. Congressional Research Service 24 Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress (2) therefore, the Secretary of the Navy should take appropriate steps to prioritize early engineering in large ship construction including amphibious class ships beginning with the LHA-8. Section 131 states: SEC. 131. SENSE OF CONGRESS ON MARINE CORPS AMPHIBIOUS LIFT AND PRESENCE REQUIREMENTS. (a) In General- It is the sense of Congress that— (1) the United States Marine Corps is a combat force which leverages maneuver from the sea as a force multiplier allowing for a variety of operational tasks ranging from major combat operations to humanitarian assistance; (2) the United States Marine Corps is unique in that, while embarked upon Naval vessels, they bring all the logistic support necessary for the full range of military operations, operating `from the sea’ they require no third party host nation permission to conduct military operations; (3) the Department of the Navy has a requirement for 38 amphibious assault ships to meet this full range of military operations; (4) for budgetary reasons only that requirement of 38 vessels was reduced to 33 vessels, which adds military risk to future operations; (5) the Department of the Navy has been unable to meet even the minimal requirement of 33 operationally available vessels and has submitted a shipbuilding and ship retirement plan to the Congress which will reduce the force to 28 vessels; and (6) experience has shown that early engineering and design of naval vessels has significantly reduced the acquisition costs and life-cycle costs of those vessels. (b) Next Generation of Amphibious Ships- In light of subsection (a), it is the sense of Congress that— (1) the Navy should consider prioritization of investment in and procurement of the next generation of amphibious assault ships; (2) the next generation amphibious assault ships should maintain survivability protection level II in accordance with current Navy ship requirements; (3) commonality in hull form design could be a desirable element to reduce acquisition and life cycle cost; and (4) maintaining a robust amphibious shipbuilding industrial base is vital for future national security. Section 354 states: SEC. 354. LIMITATION ON AVAILABILITY OF FUNDS FOR RETIREMENT OR INACTIVATION OF TICONDEROGA CLASS CRUISERS OR DOCK LANDING SHIPS. Congressional Research Service 25 Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress (a) Limitation- Except as provided by subsection (b), none of the funds authorized to be appropriated by this Act or otherwise made available for fiscal year 2013 for the Department of Defense may be obligated or expended to retire, prepare to retire, inactivate, or place in storage a cruiser or dock landing ship. (b) Exception- Notwithstanding subsection (a), the U.S.S. Port Royal, CG 73, is authorized for retirement. (c) Maintained Levels- The Secretary of the Navy, in supporting the operational requirements of the combatant commands, shall maintain the operational capability and perform the necessary maintenance of each cruiser and dock landing ship belonging to the Navy until the later of the following dates: (1) The date of the enactment of the National Defense Authorization Act for Fiscal Year 2014. (2) September 30, 2013. Section 1021 states: SEC. 1021. POLICY RELATING TO MAJOR COMBATANT VESSELS OF THE STRIKE FORCES OF THE UNITED STATES NAVY. Section 1012 of the National Defense Authorization Act for Fiscal Year 2008 (P.L. 110-181; 122 Stat. 303), as most recently amended by section 1015 of the Duncan Hunter National Defense Authorization Act for Fiscal Year 2009 (P.L. 110-417; 122 Stat. 4586), is amended by striking `Secretary of Defense’ and all that follows through the period and inserting the following: `Secretary the Navy notifies the congressional defense committees that, as a result of a cost-benefit analysis, it would not be practical for the Navy to design the class of ships with an integrated nuclear power system.’.27 Section 1022 states: SEC. 1022. LIMITATION ON AVAILABILITY OF FUNDS FOR DELAYED ANNUAL NAVAL VESSEL CONSTRUCTION PLAN. (a) In General- Section 231 of title 10, United States Code, is amended— (1) by redesignating subsection (e) as subsection (f); and (2) by inserting after subsection (d) the following new subsection (e): `(e)(1) If the Secretary of Defense does not include with the defense budget materials for a fiscal year the plan and certification under subsection (a), the Secretary of the Navy may not use more than 50 percent of the funds described in paragraph (2) during the fiscal year in which such materials are submitted until the date on which such plan and certification are submitted to the congressional defense committees. `(2) The funds described in this paragraph are funds made available to the Secretary of the Navy for operation and maintenance, Navy, for emergencies and extraordinary expenses.’. 27 For additional background information on the issue addressed by this provision, see CRS Report RL33946, Navy Nuclear-Powered Surface Ships: Background, Issues, and Options for Congress, by Ronald O'Rourke. Congressional Research Service 26 Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress (b) Conforming Amendment- Section 12304b(i) of title 10, United States Code, is amended by striking `231(e)(2)’ and inserting `section 231(f)(2)’. H.Rept. 112-479 states: The committee acknowledges that hard choices will have to be made to prioritize capabilities that allow our military to remain flexible, responsive, and decisive in any engagement. However, the committee recommends changes to the President’s proposed force structure, in order to preserve depth and capacity within the force. For example, the committee is concerned with the Navy’s overall size of the fleet and sustained demand for naval forces, particularly in light of the strategic pivot to the Asia-Pacific. In fiscal year 2013, the budget request proposed to retire four additional Ticonderoga-class guided missile cruisers well before the end of their expected service life. The committee has reinstated the requisite funding to operate and maintain, modernize and upgrade the U.S.S. Cowpens (CG 63), U.S.S. Anzio (CG 68), and the U.S.S. Vicksburg (CG 69) in fiscal year 2013 and expects the Navy to properly maintain these critical assets in the fleet in the future. The committee notes that it is less costly to maintain existing assets and supports providing the correct naval capabilities and fleet mix through a balance of new procurement and adequately maintaining the existing force structure for the length of time for which assets were initially programmed. In keeping with these concerns, the committee also authorizes a multi-year procurement for up to 10 Virginia-class submarines and a multi-year procurement for up to 10 DDG–51 Arleigh Burke class destroyers. (Page 5) The report also states: Navy Shipbuilding Program The committee is concerned with the Navy’s shipbuilding program. The budget request for fiscal year 2013 Shipbuilding and Conversion (SCN) account contained $13.7 billion, which is significantly lower than the $14.9 billion level appropriated for fiscal year 2012. In fiscal year 2012, it was forecast that the Future Years Defense Program (FYDP) would include the start of construction of 57 ships. However, 16 of those ships have fallen out of the FYDP, reducing new construction starts to 41 ships. The Navy has indicated that they will no longer seek to build a 313 ship fleet. Additionally, the Navy has proposed retiring nine additional ships during the FYDP before the end of their service lives. The committee believes the following programs are crucial. CVN–78 is the lead ship of the Ford class aircraft carrier. It incorporates improved performance and cost saving technologies, decreases the crew size by 1,200 personnel, and saves the Navy over $5.0 billion in total ownership costs for each ship. The Navy intends to start construction of the first three ships of the Ford class on a 5-year basis. The committee encourages the Navy to maintain this schedule with fiscal year 2013 as the first year of incremental funding for CVN–79. Elsewhere in this Act, the committee includes a provision that would authorize an extension from the current 5-year period to 6 years for the incremental funding of CVN–79 and CVN–80. The committee also believes it is essential to keep the Nimitz class aircraft carriers on schedule for their mid-life Refueling and Complex Overhauls to ensure these ships reach their planned service life. The Virginia class submarine program continues to deliver on cost and well ahead of contractual schedule. Having achieved a rate of two submarines a year starting in fiscal year 2011, the committee was concerned to see the rate decrease to one submarine in fiscal year 2014, and believes this would inject instability into a stable program. The committee recommends an increase in fiscal year 2013 advance procurement funds to facilitate restoring the second submarine in fiscal year 2014. To achieve that end, elsewhere in this Act, the committee includes a provision that would authorize the Secretary of the Navy to enter a Congressional Research Service 27 Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress multiyear procurement for up to 10 submarines and authorizes the Secretary to incrementally fund that multi-year contract. The Marine Corps has a stated requirement of 38 amphibious ships but has made an agreement with the Navy that 33 amphibious ships would be sufficient to provide the lift and forcible entry capabilities they require. There are currently only 29 amphibious ships in the fleet. Two large deck amphibious ships are under contract, LHA–6 and LHA–7. The fiscal year 2013 budget request slid the construction start of the next large deck amphibious ship, LHA–8, from 2016 to 2017. Prior to LHA–6, these ships had well decks, which would flood to launch landing craft. LHA–6 and LHA–7 are designed without well decks, but a well deck is going into LHA–8. The committee is concerned that the internal arrangements to accommodate a well deck are going to change construction significantly, requiring many drawing changes. The committee encourages the Navy to get an early start on LHA–8 design with the contractor. It has been proven that the greater the percentage of a design that is complete at the start of construction, the more successful the construction program. The LPD–27 is the last LPD–17 San Antonio class small deck amphibious ship until the replacement for the LSD starts. In the fiscal year 2013 plan, LSD construction has been delayed until after the FYDP. The committee is concerned that this delay may negatively affect the industrial base. In the fiscal year 2013 budget request, the Department of the Navy has requested authority to begin a multi-year program for nine DDG–51 Arleigh Burke-class destroyers. Elsewhere in this Act, the committee includes a provision that would authorize the Secretary of the Navy to award a contract for a multiyear procurement of up to 10 destroyers. In fiscal year 2016, the Navy intends to start procuring Block III DDG–51 destroyers. This block will incorporate the advanced Air and Missile Defense Radar (AMDR), which is currently being competitively evaluated. The committee views AMDR as essential to pacing the air and missile threat. The Navy has stated that the DDG–51 hull is sufficient to accommodate the increased power generation and cooling requirements that AMDR will need, yet the committee still views this as an area of risk. With the first two Littoral Combat ships (LCS) delivered to the fleet, each of a different design, each has had various problems that are being addressed by the Navy. LCS–1 has had some cracking and shaft seal problems and LCS–2 has had problems with galvanic corrosion within the water jets. The committee is aware that the Navy intends to forward stage up to four LCS to Singapore, and while supporting the budget request for four LCS in fiscal year 2013, it encourages the Navy to ensure the problems discovered to date have technical solutions and that these solutions are incorporated on forthcoming ships. Perhaps the most troubling aspect of the Navy shipbuilding plan is how it will be able to afford the Ohio class replacement ballistic missile submarine and still have a viable program for other ships. This will have to be addressed in coming years. The budget request delayed the start of construction of the first submarine by 2 years until fiscal year 2021. This delay means that the ballistic missile submarine force dips to 10 submarines for almost 10 years in a couple of decades. To maintain a credible undersea nuclear deterrent, the committee recommends restoring the research and development funding that was reduced in the fiscal year 2013 budget request to allow the Department of Defense time to determine how to keep the program on track. Elsewhere in this Act, the committee includes a provision that would prevent the Secretary of the Navy from having fewer than 12 ballistic missile submarines at a time. (Pages 34-36) Congressional Research Service 28 Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress Senate The Senate Armed Services Committee, in its report (S.Rept. 112-173 of June 4, 2012) on S. 3254, recommended approving the Navy’s requests for procurement funding for all 10 new battle force ships requested for procurement in FY2013. The committee also recommended an additional $777.7 million in FY2013 advance procurement funding to support the procurement of an additional Virginia-class attack submarine in FY2014. (Page 325) Section 122 of S. 3254 as reported would provide authority for using six-year incremental funding to procure the aircraft carriers CVN-79 and CVN-80. Section 123 would limit the obligation and expenditure of FY2013 procurement funding for the aircraft carrier CVN-79 until the Navy submits a report describing program management and cost control measures that will be employed in constructing the ship. Sections 124 and 125 would authorize new multiyear procurement (MYP) arrangements for the Virginia-class attack submarine and DDG-51 destroyer programs, respectively. Section 127 would designate the effort to develop and produce LCS mission modules as a Major Defense Acquisition Program (MDAP). The texts of these provisions and report language associated with these provisions are presented in the CRS reports on these individual programs (see “CRS Reports Tracking Legislation on Specific Navy Shipbuilding Programs” below). Section 130 of S. 3254 as reported states: SEC. 130. SENSE OF CONGRESS ON MARINE CORPS AMPHIBIOUS LIFT AND PRESENCE REQUIREMENTS. (a) Findings- Congress makes the following findings: (1) The United States Marine Corps is a combat force which leverages maneuver from the sea as a force multiplier allowing for a variety of operational tasks ranging from major combat operations to humanitarian assistance. (2) The United States Marine Corps is unique in that, while embarked upon Naval vessels, they bring all the logistic support necessary for the full range of military operations, operating `from the sea’ they require no third party host nation permission to conduct military operations. (3) The Department of the Navy has a requirement for 38 amphibious assault ships to meet this full range of military operations. (4) Due to fiscal constraints only, that requirement of 38 vessels was reduced to 33 vessels, which adds military risk to future operations. (5) The Department of the Navy has been unable to meet even the minimal requirement of 30 operationally available vessels and has submitted a shipbuilding and ship retirement plan to Congress which will reduce the force to 28 vessels. (6) Experience has shown that early engineering and design of naval vessels has significantly reduced the acquisition costs and life-cycle costs of those vessels. (b) Sense of Congress- It is the sense of Congress that— (1) the Department of Defense should carefully evaluate the maritime force structure necessary to execute demand for forces by the commanders of the combatant commands; Congressional Research Service 29 Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress (2) the Department of the Navy carefully evaluate amphibious lift capabilities to meet current and projected requirements; (3) the Department of the Navy should consider prioritization of investment in and procurement of the next generation of amphibious assault ships, as a component of the balanced battle force; (4) the next generation amphibious assault ships should maintain survivability protection; (5) operation and maintenance requirements analysis, as well as the potential to leverage a common hull form design, should be considered to reduce total ownership cost and acquisition cost; and (6) maintaining a robust amphibious ship building industrial base is vital for the future of the national security of the United States. Section 1021 states: SEC. 1021. RETIREMENT OF NAVAL VESSELS. (a) Report Required- Not later than 30 days after the date of the enactment of this Act, the Chief of Naval Operations shall submit to the congressional defense committees a report that sets forth a comprehensive description of the current requirements of the Navy for combatant vessels of the Navy, including submarines. (b) Additional Report Element if Less Than 313 Vessels Required- If the number of combatant vessels for the Navy (including submarines) specified as being required in the report under subsection (a) is less than 313 combatant vessels, the report shall include a justification for the number of vessels specified as being so required and the rationale by which the number of vessels is considered consistent with applicable strategic guidance issued by the President and the Secretary of Defense in 2012. Section 1022 states: SEC. 1022. TERMINATION OF A MARITIME PREPOSITIONING SHIP SQUADRON. (a) Report Required(1) IN GENERAL- Not later than 60 days after the date of the enactment of this Act, the Chief of Naval Operations and the Commandant of the Marine Corps shall jointly submit to the congressional defense committees a report setting forth an assessment of the Marine Corps Prepositioning Program-Norway and the capability of that program to address any readiness gaps that will be created by the termination of Maritime Prepositioning Ship Squadron One in the Mediterranean. (2) ELEMENTS- The report required by paragraph (1) shall include the following: (A) A detailed description of the time required to transfer stockpiles onto Navy vessels for use in contingency operations. (B) A comparison of the response time of the Marine Corps Prepositioning Program-Norway with the current response time of Maritime Prepositioning Ship Squadron One. Congressional Research Service 30 Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress (C) A description of the equipment stored in the stockpiles of the Marine Corps Prepositioning Program-Norway, and an assessment of the differences, if any, between that equipment and the equipment of a Maritime Prepositioning Ship squadron. (D) A description and assessment of the current age and state of maintenance of the equipment of the Marine Corps Maritime Prepositioning Program-Norway. (E) A plan to address the equipment shortages and modernization needs of the Marine Corps Maritime Prepositioning Program-Norway. (b) Limitation on Availability of Funds- Amounts authorized to be appropriated by this Act may not be obligated or expended to terminate a Maritime Prepositioning Ship squadron until the date of the submittal to the congressional defense committees of the report required by subsection (a). Section 1023 states: SEC. 1023. SENSE OF CONGRESS ON RECAPITALIZATION FOR THE NAVY AND COAST GUARD. (a) Findings- Congress makes the following findings: (1) More than 70 percent of the world’s surface is comprised of navigable oceans. (2) More than 80 percent of the population of the world lives within 100 miles of an ocean. (3) More than 90 percent of the world’s commerce traverses an oceans. (4) The national security of the United States is inextricably linked to the maintenance of global freedom of access for both the strategic and commercial interests of the United States. (5) To maintain that freedom of access the sea services of the United States, composed of the Navy, the Marine Corps, and the Coast Guard, must be sufficiently positioned as rotationally globally deployable forces with the capability to decisively defend United States citizens, homeland, and interests abroad from direct or asymmetric attack and must be comprised of sufficient vessels to maintain global freedom of action. (6) To achieve appropriate capabilities to ensure national security the Government of the United States must continue to recapitalize the fleets of the Navy and Coast Guard and must continue to conduct vital maintenance and repair of existing vessels to ensure such vessels meet service life goals. (b) Sense of Congress- It is the sense of Congress that— (1) the sea services of the United States should be funded and maintained to provide the broad spectrum of capabilities required to protect the national security of the United States; (2) such capabilities should include— (A) the ability to project United States power rapidly anywhere on the globe without the need for host nation basing permission or long and potentially vulnerable logistics supply lines; Congressional Research Service 31 Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress (B) the ability to land and recover maritime forces from the sea for direct combat action, to evacuate United States citizens from hostile situations, and to provide humanitarian assistance where needed; (C) the ability to operate from the subsurface with overpowering conventional combat power, as well as strategic deterrence; and (D) the ability to operate in collaboration with United States maritime partners in the common interest of preventing piracy at sea and maintaining the commercial sea lanes available for global commerce; (3) the Secretary of Defense, in coordination with the Secretary of the Navy, should maintain the recapitalization plans for the Navy as a priority in all future force structure decisions; and (4) the Secretary of Homeland Security should maintain the recapitalization plans for the Coast Guard as a priority in all future force structure decisions. Regarding Section 1021, S.Rept. 112-173 states: Retirement of naval vessels (sec. 1021) The committee recommends a provision that would require the Chief of Naval Operations to produce a report that would set forth a comprehensive description of the current requirements of the Navy for combatant vessels of the Navy, including submarines. The provision would also require that, if the number of these vessels is less than 313 ships, the report would have to include the justification of the Chief of Naval Operations for that smaller number, and an explanation of how that smaller number is consistent with the recently revised strategic guidance issued by the President and the Secretary of Defense in 2012. Section 1021 of the National Defense Authorization Act for Fiscal Year 2010 (Public Law 111–84) conveyed the sense of Congress that “the Navy should meet its requirement for a 313-ship fleet until such time that modifications to the Navy’s ship fleet force structure are warranted, and the Secretary of the Navy provides Congress with a justification of any proposed modifications, supported by rigorous and sufficient warfighting analysis.” The Chiefs of Naval Operations since 2006 have consistently stated that they need a fleet of 313 ships to do their jobs. Nevertheless, the Navy has not achieved this number of ships in the fleet since falling below that level in the 1990s. In testimony before the congressional defense committees and other public remarks, senior Navy leaders, including the Secretary of the Navy, the Under Secretary of the Navy, and the Chief of Naval Operations, have noted that the Navy is conducting a new review of Navy force structure review. Navy officials say that they have not completed the review, but that it will probably reduce the goal for fleet size to approximately 300 ships. The committee is concerned that the Navy or the Department of Defense (DOD) may propose reductions in the Navy’s ship fleet force structure without sufficient justification. The committee reminds the Navy and DOD that the statement of the sense of Congress remains in effect, and that the committee expects that any proposed change in goal for the size of the Navy’s fleet will be accompanied by rigorous and sufficient analysis that is convincing. The committee doubts that neither a strategy shifting DOD’s focus to the Pacific and Asia, nor the demands of current operational requirements, nor increased investment by potential Congressional Research Service 32 Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress adversaries in naval forces and anti-access and area-denial capabilities warrant a reduction in the required Navy fleet size. (Pages 187-188) FY2013 DOD Appropriations Act (H.R. 5856) House The House Appropriations Committee, in its report (H.Rept. 112-493 of May 25, 2012) on H.R. 5856, recommended approving, with some adjustments, the Navy’s requests for procurement funding for all 10 new battle force ships requested for procurement in FY2013. The committee recommended reducing by $29.9 million the funding request for the aircraft carrier CVN-79, and reducing by $12.03 million the funding request for the two DDG.-51 destroyers requested for procurement in FY2013. The committee also recommended an additional $723 million in FY2013 advance procurement funding to preserve the option of procuring an additional Virginiaclass attack submarine in FY2014, and an additional $1 billion in FY2013 procurement funding to facilitate the procurement of an additional DDG-51.28 (Pages 156 and 157) H.Rept. 112-493 states: SHIPBUILDING The Navy’s shipbuilding program is the centerpiece of the Navy’s budget request. The Nation’s fleet creates our forward presence, projects power, and maintains open sea lanes. The Committee is well aware that the sight of a U.S. Navy ship on the horizon makes a powerful strategic statement in any theater. The Committee strongly supports all actions to maintain the standing of the United States Navy as the world’s preeminent sea power and a global good neighbor when humanitarian relief is required. The Committee is therefore puzzled by the Navy’s priorities in its shipbuilding plan. As part of its new strategy, the Department of Defense has rebalanced toward the AsiaPacific and Middle East regions of the world. Despite these regions having a significantly larger area of the world’s oceans, the Navy plans to accelerate the decommissioning of seven guided missile cruisers, has reduced the shipbuilding budget by nearly eleven percent relative to the fiscal year 2012 appropriated level, and is reducing the total number of ships required to fulfill its requirements under this new strategy. The required fleet size has been reduced from 313 ships to approximately 300 ships in the long term, but the Navy will maintain 285 ships in the near term. The Navy has also deferred the procurement of an attack submarine and a guided missile destroyer, the backbone of the Navy’s combatant fleet, from fiscal year 2014 to future years and, in their place has inserted a vessel known as the Afloat Forward Staging Base. This vessel would fill a very long standing (but never fulfilled) mission need. The Committee applauds the Navy for finally fulfilling such a long standing need but is confused by the timing of this action in an era of decreasing budgets and also by the fact that a submarine and destroyer are not being procured in fiscal year 2014 in part to make funding available for this new vessel. The decision to defer the procurement of a submarine and a destroyer is both confusing and concerning, especially the submarine. Since its inception in 1998, the Virginia Class 28 A table on page 156 of the committee’s report shows a transfer of $189.2 million from the LPD-17 amphibious ship program to the JHSV program (identified in the table as “intratheater conector”), but this appears to be a typo, as the Navy’s FY2013 budget requests the $189.2 million for the JHSV program. Congressional Research Service 33 Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress Submarine program always intended to build two submarines per year. Although the second submarine repeatedly appeared in outyear budget projections, it was continually deferred by the Navy. The program finally reached a rate of two submarines per year in fiscal year 2011, largely due to the efforts of this Committee. Now, after only three years at this rate (2011 through 2013), the Navy is again reducing the production rate. The Committee believes this decision will increase the cost of the submarines, result in production inefficiencies, and exacerbate the Navy’s own predicted attack submarine shortfall. Additionally, with the impending addition of the SSBN replacement submarine to the shipbuilding budget, an event which will “suck the air out of the Navy’s shipbuilding budget” according to a former Secretary of Defense, funding in the outyears will not be any easier to come by. The Committee believes the Navy recognizes the need to fund another destroyer and submarine in fiscal year 2014 since the Navy has approached the Committee with various plans and schemes to attempt to restore these ships to fiscal year 2014. One of these plans revolves around the incremental funding concept despite the fact that the Department’s own financial management regulations and policies prohibit incremental funding of large end items such as ships, except under certain circumstances, none of which apply in this case. The Committee strongly supports these regulations and policies because fully funded end items do not commit future Congresses to obligations they may or may not agree with and also because they provide the ability to conduct much more complete, transparent, and rigorous program oversight. Incremental funding is certainly comparable to buying items on credit by deferring payments to the outyears. The Committee understands the constraints of the fiscal year 2014 budget, but to give up two highly prized combatants, and fund instead a vessel for a mission that can be (and has been) satisfied with existing ships, then attempt to restore those combatants through funding gimmicks in violation of the Department’s own financial regulations is deeply troubling. The Committee firmly believes that a strong Navy shipbuilding program is absolutely essential for the Nation’s security but will not mortgage the Nation’s future to accomplish it. Accordingly, the recommendation provides an additional $1,000,000,000 above the request for the procurement of an additional DDG–51 guided missile destroyer. The Secretary of the Navy is directed to use this funding as part of the DDG–51 multiyear procurement planned for fiscal years 2013 through 2017 in order to achieve a lower cost and provide a more stable production base for the duration of the DDG–51 multiyear procurement. Finally, the recommendation provides an additional $723,000,000 above the request for advance procurement for the Virginia Class Submarine program. The Secretary of the Navy is directed to fully fund an additional submarine in fiscal year 2014 to achieve a lower cost and stable production base through the course of the program’s planned multiyear procurement. (Pages 158-159) The report also states: AFLOAT FORWARD STAGING BASE The request includes $38,000,000 for the advance procurement of items for the Afloat Forward Staging Base (AFSB). The AFSB is envisioned by the Navy to act as a mobile atsea platform that will provide flexible mission support and sustainment. This platform will fulfill a very longstanding (at least 20 years) but never fulfilled mission need for sea-based support for a variety of missions. In the past, this mission need has been filled by a variety of ad-hoc methods to include the use of available surface combatants or amphibious ships. The closest dedicated platform to fulfilling a similar mission need was the conversion of the Navy’s amphibious assault ship, USS Inchon, to a mine countermeasure command and support ship in 1995. This was done at a time when the Navy was shifting the fleet from an organic mine warfare capability embedded on surface combatants to a more dedicated mine Congressional Research Service 34 Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress warfare capability of mine hunting ships and aircraft. Similarly, the Navy plans to fill this mission need in the very near term with the conversion of the USS Ponce in fiscal year 2012. Further, the Committee notes that the AFSB is planned for construction in the National Defense Sealift Fund, whose purpose in ship construction is for strategic sealift acquisition. The Committee is struggling with placing the mission of the AFSB into a strategic sealift area and directs the Secretary of the Navy to accomplish any AFSB tasks in the traditional Navy appropriation accounts. The Committee applauds the Navy for finally attempting to satisfy such a longstanding need, but it is confused as to the timing of satisfying this need in an era of decreasing budgets and when two combatants were pulled out of the fiscal year 2014 shipbuilding program. The Committee believes this mission need can continue to be satisfied as it has been satisfied to date. The Committee directs the Navy to apply the fiscal year 2014 funding currently projected for the construction of an AFSB toward fully funding an additional submarine to help achieve cost savings and industrial base stability in that program. Accordingly, the recommendation provides no funding for the AFSB. (Pages 259-260) CRS Reports Tracking Legislation on Specific Navy Shipbuilding Programs For funding levels and legislative activity on individual Navy shipbuilding, conversion, and modernization programs, see the following CRS reports: • CRS Report RS20643, Navy Ford (CVN-78) Class Aircraft Carrier Program: Background and Issues for Congress, by Ronald O'Rourke. • CRS Report R41129, Navy Ohio Replacement (SSBN[X]) Ballistic Missile Submarine Program: Background and Issues for Congress, by Ronald O'Rourke. • CRS Report RL32418, Navy Virginia (SSN-774) Class Attack Submarine Procurement: Background and Issues for Congress, by Ronald O'Rourke. • CRS Report RL32109, Navy DDG-51 and DDG-1000 Destroyer Programs: Background and Issues for Congress, by Ronald O'Rourke. • CRS Report RL33741, Navy Littoral Combat Ship (LCS) Program: Background, Issues, and Options for Congress, by Ronald O'Rourke. Congressional Research Service 35 Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress Appendix A. 2012 Testimony on Size of Navy Needed to Fully Meet COCOM Requests This appendix presents three instances of when Navy officials this year have testified that a Navy of more than 500 ships would be required to fully meet combatant commander COCOM requests for Navy forces. March 22, 2012, Hearing At a March 22, 2012, hearing on Navy readiness before the Readiness subcommittee of the House Armed Services Committee, the following exchange occurred: REPRESENTATIVE J. RANDY FORBES: We have a lot of requests for our combatant commanders—of the validated requests that come from combatant commanders. How many ships would it take in our navy, based on your estimation, to meet all of the validated requests from our commanders, combatant commanders? VICE ADMIRAL WILLIAM R. BURKE, DEPUTY CHIEF OF NAVAL OPERATIONS FOR FLEET READINESS AND LOGISTICS: Let me—give me just a minute on that, sir. FORBES: Please. And if you’d like, on any of these questions, if you’d rather take them for the record and get back I’m OK with that, too. BURKE: I’m—no, I'm happy to answer the question. I just want to make sure I elaborate a little to make sure we get—get the point right. FORBES: Please. BURKE: The—the combatant commander requests come in to the—to the services, and then the— there’s a—a very high number of requirements from the services, or from the—the combatant commanders which are then prioritized and adjudicated by the joint staff. Essentially, a way to adjudicate supply—a lesser supply and a greater demand. So—so those—of those requests that come in, some are determined to be more valid than others, if you will. But to get to your exact question, of those requests that come in from the combatant commanders, if we ... (CROSSTALK) Congressional Research Service 36 Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress FORBES: Admiral, could—could I just—on the nomenclature, just make sure I’m right, too. As they come in, one of the first weed-out processes is we determine whether they’re validated or not. In other words, we go through and make sure they’re legal, they don't have the other asset somewhere. And—and then we stamp them as validated. And then like you said, they go through a process where we then look at the resources we have and allocate what we can. And we adjudicate which ones we can give and which ones we can’t. So I want the top number. The—the ones that we have validated and said, “Yes, this is legal, it’s a proper request.” Of those combatant commander requests, approximately how many ships would it take us to be able to meet those if we had them? BURKE: It would take a navy of over 500 ships to meet the combatant commander requests. And, of course, it would take a similar increase in the aircraft and—and other parts of the—of the Navy, as well, to meet the combatant commander requests.29 March 29, 2012, Hearing At a March 29, 2012, hearing on Navy shipbuilding programs before the Seapower and Projection Forces subcommittee of the House Armed Services Committee, the following exchange occurred: REPRESENTATIVE DUNCAN D. HUNTER: If you were to build the amphibs [i.e., amphibious ships] where would you prioritize? I mean, where would you take money out of to be able to get the Marine Corps to where they need to be? VICE ADMIRAL JOHN TERENCE BLAKE, DEPUTY CHIEF OF NAVAL OPERATIONS FOR INTEGRATION OF CAPABILITIES AND RESOURCES: Here’s the issue we deal with: I don’t have the luxury of dealing with any single issue in isolation; I have to deal with it across the entire... HUNTER: Well, we can. That’s why I'm asking. BLAKE: Well, we have to deal with it, though, across the entire portfolio. HUNTER: Sure. 29 Source: Transcript of hearing. Congressional Research Service 37 Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress BLAKE: And so what we have to do is we have to balance the requirement for amphibs, the requirement for surface combatants, the requirement for the carriers, the submarines—every category of ships that we have. And so when we do that we then have to say, all right, as we balance across that where are we going to be able to assume more risk? And that’s how we— that’s how we end up where we are. HUNTER: So you’re saying there is less risk but still risk in the Marine Corps being short on amphibs than there are in the other—the rest of the picture? BLAKE: No. I’m saying that we have assumed risk in all areas. The best example I can give you: It was only a short time ago, if we tried to fill all the COCOM needs we said the number was around 400 ships we’d need in the fleet. Today—and we see no abatement in that commitment or the... HUNTER: No (inaudible) signal. BLAKE: Today we look at it and we see that we would—if we wanted to hit 100 percent of all the COCOM requirements we’d need in excess of 500 ships. So what we end up having to do is we go through the—the global management process and we look at it and we say, here are our highest priorities, these are how we are going to address them, and then we—we have those units available and we push that... HUNTER: I understand. I’m going to yield back in just one second. So I would take from your statement, then, that you did go through a prioritization process and the amphibs are not at the top of that list. And second, when you say that you assume risk all the way around I would argue that when you do your risk assessment and you prioritize your needs the fact that the COCOMs wanted more ships and needed more ships due to the international environment and where we find ourselves with the world today, going down is probably – it’s going the wrong way. We all know that, but I—I would—I would argue that your prioritization—I would like to see that, if you don’t mind, the—the way that you analyzed this and the—and the way that you said, hey, we’re going to—we’re going to keep them there to make sure that we have this over here. That’s all I'm asking for. Congressional Research Service 38 Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress BLAKE: OK. When we put it together we do it across the entire spectrum; we don’t—and by that I mean, as we look at the entire requirement we say, this is what we need to do in order to be able to meet the COCOM demand signal.30 April 19, 2012, Hearing At an April 19, 2012, hearing on Navy shipbuilding programs before the Seapower subcommittee of the Senate Armed Services Committee, the following exchange occurred: SENATOR ROGER WICKER: Admiral Burke and General Mills, from an operational perspective, the Navy budget cost for decreases in large amphibious ships among other categories, in my opening statement, I mentioned that the requests from combatant commanders for amphibious ships has increased over 80 percent in the last five years—a very dramatic number. What is the reason for that and what will be the impact if these requests are—are not met? VICE ADMIRAL WILLIAM R. BURKE, DEPUTY CHIEF OF NAVAL OPERATIONS FOR FLEET READINESS AND LOGISTICS: Senator, thanks for the question. You're right, the COCOM demand signal has gone up significantly to the point where if we were to meet their—all their requirements, it would take a Navy of greater than 500 ships. So, I certainly am not here to begrudge the COCOM demand signal because they have challenges that they’re trying to deal with. But—but we can’t meet—meet all their demands. So there is a process in the—in the Pentagon run by the joint staff called the Global Force Management process by which they take in the COCOM requirements and adjudicate that along with the forces we have to come to a reasonable allocation of—of force. And so that’s the—that’s a process we’re dealing with today. We’ve been using that process for a number of years, and I would expect we will continue to use that process in the future to—to bridge the gap between supply and demand.31 30 31 Source: Transcript of hearing. Source: Transcript of hearing. Congressional Research Service 39 Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress Appendix B. Using Past Ship Force Levels to Assess Proposed Force Levels One possible method for assessing proposals for the future size and structure of the Navy is to compare them to historical figures for total Navy fleet size. Historical figures for total fleet size, however, might not be a reliable yardstick for assessing the appropriateness of proposals for the future size and structure of the Navy, particularly if the historical figures are more than a few years old, because the missions to be performed by the Navy, the mix of ships that make up the Navy, and the technologies that are available to Navy ships for performing missions all change over time. The Navy, for example, reached a late-Cold War peak of 568 battle force ships at the end of FY1987,32 and as of April 24, 2012, had declined to a total of 282 battle force ships. The FY1987 fleet, however, was intended to meet a set of mission requirements that focused on countering Soviet naval forces at sea during a potential multi-theater NATO-Warsaw Pact conflict, while the April 2012 fleet is intended to meet a considerably different set of mission requirements centered on influencing events ashore by countering both land- and sea-based military forces of potential regional threats other than Russia, including improved Chinese military forces and non-state terrorist organizations. In addition, the Navy of FY1987 differed substantially from the April 2012 fleet in areas such as profusion of precision-guided air-delivered weapons, numbers of Tomahawk-capable ships, and sophistication of C4ISR systems.33 In coming years, Navy missions may shift again, and the capabilities of Navy ships will likely have changed further by that time due to developments such as more comprehensive implementation of networking technology and increased use of ship-based unmanned vehicles. The 568-ship fleet of FY1987 may or may not have been capable of performing its stated missions; the 282-ship fleet of April 2012 may or may not be capable of performing its stated missions; and a fleet years from now with a certain number of ships may or may not be capable of performing its stated missions. Given changes over time in mission requirements, ship mixes, and technologies, however, these three issues are to a substantial degree independent of one another. For similar reasons, trends over time in the total number of ships in the Navy are not necessarily a reliable indicator of the direction of change in the fleet’s ability to perform its stated missions. An increasing number of ships in the fleet might not necessarily mean that the fleet’s ability to perform its stated missions is increasing, because the fleet’s mission requirements might be increasing more rapidly than ship numbers and average ship capability. Similarly, a decreasing 32 Some publications have stated that the Navy reached a peak of 594 ships at the end of FY1987. This figure, however, is the total number of active ships in the fleet, which is not the same as the total number of battle force ships. The battle force ships figure is the number used in government discussions of the size of the Navy. In recent years, the total number of active ships has been larger than the total number of battle force ships. For example, the Naval History and Heritage Command (formerly the Naval Historical Center) states that as of November 16, 2001, the Navy included a total of 337 active ships, while the Navy states that as of November 19, 2001, the Navy included a total of 317 battle force ships. Comparing the total number of active ships in one year to the total number of battle force ships in another year is thus an apples-to-oranges comparison that in this case overstates the decline since FY1987 in the number of ships in the Navy. As a general rule to avoid potential statistical distortions, comparisons of the number of ships in the Navy over time should use, whenever possible, a single counting method. 33 C4ISR stands for command and control, communications, computers, intelligence, surveillance, and reconnaissance. Congressional Research Service 40 Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress number of ships in the fleet might not necessarily mean that the fleet’s ability to perform stated missions is decreasing, because the fleet’s mission requirements might be declining more rapidly than numbers of ships, or because average ship capability and the percentage of time that ships are in deployed locations might be increasing quickly enough to more than offset reductions in total ship numbers. Previous Navy force structure plans, such as those shown in Table 1, might provide some insight into the potential adequacy of a proposed new force-structure plan, but changes over time in mission requirements, technologies available to ships for performing missions, and other forceplanning factors suggest that some caution should be applied in using past force structure plans for this purpose, particularly if those past force structure plans are more than a few years old. The Reagan-era plan for a 600-ship Navy, for example, was designed for a Cold War set of missions focusing on countering Soviet naval forces at sea, which is not an appropriate basis for planning the Navy today.34 34 Navy force structure plans that predate those shown in Table 1 include the Reagan-era 600-ship plan of the 1980s, the Base Force fleet of more than 400 ships planned during the final two years of the George H. W. Bush Administration, the 346-ship fleet from the Clinton Administration’s 1993 Bottom-Up Review (or BUR, sometimes also called Base Force II), and the 310-ship fleet of the Clinton Administration’s 1997 QDR. The table below summarizes some key features of these plans. Features of Recent Navy Force Structure Plans Plan Total ships Attack submarines Aircraft carriers Surface combatants Amphibious ships 600-ship ~600 100 15e 242/228g ~75h Base Force ~450/416a 80/~55c 12 ~150 51i 1993 BUR 346 45-55 11+1f ~124 41i 1997 QDR ~305/310b 50/55d 11+1f 116 36i Source: Prepared by CRS based on DOD and U.S. Navy data. a. Commonly referred to as 450-ship plan, but called for decreasing to 416 ships by end of FY1999. b. Original total of about 305 ships was increased to about 310 due to increase in number of attack submarines to 55 from 50. c. Plan originally included 80 attack submarines, but this was later reduced to about 55. d. Plan originally included 50 attack submarines but this was later increased to 55. e. Plus one additional aircraft carrier in the service life extension program (SLEP). f. Eleven active carriers plus one operational reserve carrier. g. Plan originally included 242 surface combatants but this was later reduced to 228. h. Number needed to lift assault echelons of one Marine Expeditionary Force (MEF) plus one Marine Expeditionary Brigade (MEB). i. Number needed to lift assault echelons of 2.5 MEBs. Changing numbers needed to meet this goal reflect in part changes in the design and capabilities of amphibious ships. Congressional Research Service 41 Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress Appendix C. Independent Panel Assessment of 2010 QDR The law that requires DOD to perform QDRs once every four years (10 U.S.C. 118) states that the results of each QDR shall be assessed by an independent panel. The report of the independent panel that assessed the 2010 QDR was released on July 29, 2010. The independent panel’s report recommended a Navy of 346 ships, including 11 aircraft carriers and 55 attack submarines.35 The report stated the following, among other things: • “The QDR should reflect current commitments, but it must also plan effectively for potential threats that could arise over the next 20 years.… we believe the 2010 QDR did not accord sufficient priority to the need to counter anti-access challenges, strengthen homeland defense (including our defense against cyber threats), and conduct post-conflict stabilization missions.” (Page 54) • “In this remarkable period of change, global security will still depend upon an American presence capable of unimpeded access to all international areas of the Pacific region. In an environment of ‘anti-access strategies,’ and assertions to create unique ‘economic and security zones of influence,’ America‘s rightful and historic presence will be critical. To preserve our interests, the United States will need to retain the ability to transit freely the areas of the Western Pacific for security and economic reasons. Our allies also depend on us to be fully present in the Asia-Pacific as a promoter of stability and to ensure the free flow of commerce. A robust U.S. force structure, largely rooted in maritime strategy but including other necessary capabilities, will be essential.” (Page 51) • “The United States will need agile forces capable of operating against the full range of potential contingencies. However, the need to deal with irregular and hybrid threats will tend to drive the size and shape of ground forces for years to come, whereas the need to continue to be fully present in Asia and the Pacific and other areas of interest will do the same for naval and air forces.” (Page 55) • “The force structure in the Asia-Pacific needs to be increased. In order to preserve U.S. interests, the United States will need to retain the ability to transit freely the areas of the Western Pacific for security and economic reasons. The United States must be fully present in the Asia-Pacific region to protect American lives and territory, ensure the free flow of commerce, maintain stability, and defend our allies in the region. A robust U.S. force structure, one that is largely rooted in maritime strategy and includes other necessary capabilities, will be essential.” (Page 66) • “Force structure must be strengthened in a number of areas to address the need to counter anti-access challenges, strengthen homeland defense (including defense against cyber threats), and conduct post-conflict stabilization missions: First, as a Pacific power, the U.S. presence in Asia has underwritten the regional stability that has enabled India and China to emerge as rising economic powers. The 35 Stephen J. Hadley and William J. Perry, co-chairmen, et al, The QDR in Perspective: Meeting America’s National Security Needs In the 21st Century, The Final Report of the Quadrennial Defense Review Independent Panel, Washington, 2010, Figure 3-2 on page 58. Congressional Research Service 42 Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress United States should plan on continuing that role for the indefinite future. The Panel remains concerned that the QDR force structure may not be sufficient to assure others that the United States can meet its treaty commitments in the face of China’s increased military capabilities. Therefore, we recommend an increased priority on defeating anti-access and area-denial threats. This will involve acquiring new capabilities, and, as Secretary Gates has urged, developing innovative concepts for their use. Specifically, we believe the United States must fully fund the modernization of its surface fleet. We also believe the United States must be able to deny an adversary sanctuary by providing persistent surveillance, tracking, and rapid engagement with high-volume precision strike. That is why the Panel supports an increase in investment in long-range strike systems and their associated sensors. In addition, U.S. forces must develop and demonstrate the ability to operate in an information-denied environment.” (Pages 59-60) • “To compete effectively, the U.S. military must continue to develop new conceptual approaches to dealing with operational challenges, like the Capstone Concept for Joint Operations (CCJO). The Navy and Air Force‘s effort to develop an Air-Sea Battle concept is one example of an approach to deal with the growing anti-access challenge. It will be necessary to invest in modernized capabilities to make this happen. The Chief of Naval Operations and Chief of Staff of the Air Force deserve support in this effort, and the Panel recommends the other military services be brought into the concept when appropriate.” (Page 51; a similar passage appears on page 67) In recommending a Navy of 346 ships, the independent panel’s report cited the 1993 Bottom-Up Review (BUR) of U.S. defense plans and policies. Table C-1 compares the Navy’s 310-316 ship goal of March 2012 to the 346-ship Navy recommended in the 1993 BUR (as detailed partly in subsequent Navy testimony and publications) and the ship force levels recommended in the independent panel report. Congressional Research Service 43 Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress Table C-1. Comparison of Navy’s 310-316 ship goal, Navy Plan from 1993 BUR, and Navy Plan from 2010 QDR Review Panel Ship Type Navy’s 310-316 ship goal of September 2011 Bottom-Up Review (BUR) (1993) 2010 QDR Independent Review Panel (July 2010) 12-14 18 14 SSBNs (SSBN force was later reduced to 14 as a result of the 1994 Nuclear Posture Review) SSGNs 0-4 0 4 (SSGN program did not yet exist) SSNs ~48 45 to 55 55 (55 in FY99, with a long-term goal of about 45) Aircraft carriers Surface combatants 11 active 11 active + 1 operational/reserve 11 active ~145 124 n/a (114 active + 10 frigates in Naval Reserve Force; a total of 110-116 active ships was also cited) Cruisers and destroyers Frigates ~90 n/a n/a 0 n/a n/a 0 n/a (to be replaced by LCSs) LCSs ~55 (LCS program did not exist) Amphibious ships ~32 41 (30 operational ships needed to lift 2.0 MEBs) (Enough to lift 2.5 MEBs) 0 26 (to be replaced by LCSs) (LCS program did not exist) CLF ships ~29 43 n/a Support ships ~33 22 n/a ~310-316 346 346 Dedicated mine warfare ships TOTAL ships n/a n/a (numbers above add to 331-341)a Source: Table prepared by CRS. Sources for 1993 Bottom-Up Review: Department of Defense, Report on the Bottom-Up Review, October 1993, Figure 7 on page 28; Department of the Navy, Highlights of the FY 1995 Department of the Navy Budget, February 1994, p. 1; Department of the Navy, Force 2001, A Program Guide to the U.S. Navy, 1994 edition, p. 15; Statement of VADM T. Joseph Lopez, U.S. Navy, Deputy Chief of Naval Operations (Resources, Warfare Requirements & Assessments), Testimony to the Military Forces and Personnel Subcommittee of the House Armed Services Committee, March 22, 1994, pp. 2-5. Source for independent panel report: Stephen J. Hadley and William J. Perry, co-chairmen, et al., The QDR in Perspective: Meeting Congressional Research Service 44 Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress America’s National Security Needs In the 21st Century, The Final Report of the Quadrennial Defense Review Independent Panel, Washington, 2010, Figure 3-2 on pages 58-59. Notes: n/a is not addressed in the report. SSBN is nuclear-powered ballistic missile submarine; SSGN is nuclear-powered cruise missile and special operations forces submarine; SSN is nuclear-powered attack submarine; LCS is Littoral Combat Ship; MPF(F) is Maritime Prepositioning Force (Future) ship; CLF is combat logistics force (i.e., resupply) ship; MEB is Marine Expeditionary Brigade. a. The Navy testified in 1994 that the planned number was adjusted from 346 to 330 to reflect reductions in numbers of tenders and early retirements of some older amphibious ships. In a letter dated August 11, 2010, Secretary of Defense Robert Gates provided his comments on the independent panel’s report. The letter stated in part: I completely agree with the Panel that a strong navy is essential; however, I disagree with the Panel’s recommendation that DoD should establish the 1993 Bottom Up Review’s (BUR’s) fleet of 346 ships as the objective target. That number was a simple projection of the thenplanned size of [the] Navy in FY 1999, not a reflection of 21st century, steady-state requirements. The fleet described in the 2010 QDR report, with its overall target of 313 to 321 ships, has roughly the same number of aircraft carriers, nuclear-powered attack submarines, surface combatants, mine warfare vessels, and amphibious ships as the larger BUR fleet. The main difference between the two fleets is in the numbers of combat logistics, mobile logistics, and support ships. Although it is true that the 2010 fleet includes fewer of these ships, they are all now more efficiently manned and operated by the Military Sealift Command and meet all of DoD’s requirements…. I agree with the Panel’s general conclusion that DoD ought to enhance its overall posture and capabilities in the Asia-Pacific region. As I outlined in my speech at the Naval War College in April 2009, “to carry out the missions we may face in the future… we will need numbers, speed, and the ability to operate in shallow waters.” So as the Air-Sea battle concept development reaches maturation, and as DoD’s review of global defense posture continues, I will be looking for ways to meet plausible security threats while emphasizing sustained forward presence – particularly in the Pacific.36 36 Letter dated August 11, 2010, from Secretary of Defense Robert Gates to the chairmen of the House and Senate Armed Services and Appropriations Committees, pp. 3 and 4. The ellipsis in the second paragraph appears in the letter. Congressional Research Service 45 Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress Appendix D. Size of the Navy and Navy Shipbuilding Rate Size of the Navy Table D-1 shows the size of the Navy in terms of total number of ships since FY1948; the numbers shown in the table reflect changes over time in the rules specifying which ships count toward the total. Differing counting rules result in differing totals, and for certain years, figures reflecting more than one set of counting rules are available. Figures in the table for FY1978 and subsequent years reflect the battle force ships counting method, which is the set of counting rules established in the early 1980s for public policy discussions of the size of the Navy. As shown in the table, the total number of battle force ships in the Navy reached a late-Cold War peak of 568 at the end of FY1987 and began declining thereafter.37 The Navy fell below 300 battle force ships in August 2003 and included 282 battle force ships as of April 24, 2012. As discussed in Appendix B, historical figures for total fleet size might not be a reliable yardstick for assessing the appropriateness of proposals for the future size and structure of the Navy, particularly if the historical figures are more than a few years old, because the missions to be performed by the Navy, the mix of ships that make up the Navy, and the technologies that are available to Navy ships for performing missions all change over time. For similar reasons, trends over time in the total number of ships in the Navy are not necessarily a reliable indicator of the direction of change in the fleet’s ability to perform its stated missions. An increasing number of ships in the fleet might not necessarily mean that the fleet’s ability to perform its stated missions is increasing, because the fleet’s mission requirements might be increasing more rapidly than ship numbers and average ship capability. Similarly, a decreasing number of ships in the fleet might not necessarily mean that the fleet’s ability to perform stated missions is decreasing, because the fleet’s mission requirements might be declining more rapidly than numbers of ships, or because average ship capability and the percentage of time that ships are in deployed locations might be increasing quickly enough to more than offset reductions in total ship numbers. 37 Some publications have stated that the Navy reached a peak of 594 ships at the end of FY1987. This figure, however, is the total number of active ships in the fleet, which is not the same as the total number of battle force ships. The battle force ships figure is the number used in government discussions of the size of the Navy. In recent years, the total number of active ships has been larger than the total number of battle force ships. For example, the Naval History and Heritage Command (formerly the Naval Historical Center) states that as of November 16, 2001, the Navy included a total of 337 active ships, while the Navy states that as of November 19, 2001, the Navy included a total of 317 battle force ships. Comparing the total number of active ships in one year to the total number of battle force ships in another year is thus an apples-to-oranges comparison that in this case overstates the decline since FY1987 in the number of ships in the Navy. As a general rule to avoid potential statistical distortions, comparisons of the number of ships in the Navy over time should use, whenever possible, a single counting method. Congressional Research Service 46 Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress Table D-1. Total Number of Ships in the Navy Since FY1948 FYa Number FYa Number FYa Number 1948 737 1970 769 1992 466 1949 690 1971 702 1993 435 1950 634 1972 654 1994 391 1951 980 1973 584 1995 373 1952 1,097 1974 512 1996 356 1953 1,122 1975 496 1997 354 1954 1,113 1976 476 1998 333 1955 1,030 1977 464 1999 317 1956 973 1978 468 2000 318 1957 967 1979 471 2001 316 1958 890 1980 477 2002 313 1959 860 1981 490 2003 297 1960 812 1982 513 2004 291 1961 897 1983 514 2005 282 1962 959 1984 524 2006 281 1963 916 1985 541 2007 279 1964 917 1986 556 2008 282 1965 936 1987 568 2009 285 1966 947 1988 565 2010 288 1967 973 1989 566 2011 284 1968 976 1990 547 2012 1969 926 1991 526 2013 Source: Compiled by CRS using U.S. Navy data. Numbers shown reflect changes over time in the rules specifying which ships count toward the total. Figures for FY1978 and subsequent years reflect the battle force ships counting method, which is the set of counting rules established in the early 1980s for public policy discussions of the size of the Navy. a. Data for earlier years in the table may be for the end of the calendar year (or for some other point during the year), rather than for the end of the fiscal year. Shipbuilding Rate Table D-2 shows past (FY1982-FY2012) and requested (FY2013-FY2017) rates of Navy ship procurement. Congressional Research Service 47 Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress Table D-2. Battle Force Ships Procured or Requested, FY1982-FY2017 (Procured FY1982-FY2012; requested FY2013-FY2017) 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 17 14 16 19 20 17 15 19 15 11 11 7 4 4 5 4 5 5 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 6 6 6 5 7 8 4a 5a 3a 8 7 10 11b 10 7 8 9 7 Source: CRS compilation based on Navy budget data and examination of defense authorization and appropriation committee and conference reports for each fiscal year. The table excludes non-battle force ships that do not count toward the 310-316 ship goal, such as certain sealift and prepositioning ships operated by the Military Sealift Command and oceanographic ships operated by agencies such as the National Oceanic and Atmospheric Administration (NOAA). a. The totals shown for FY2006, FY2007, and FY2008, reflect the cancellation two LCSs funded in FY2006, another two LCSs funded in FY2007, and an LCS funded in FY2008. b. The total shown for FY2012 includes two JHSVs—one that was included in the Navy’s FY2012 budget submission, and one that was included in the Army’s FY2012 budget submission. Until FY2012, JHSVs were being procured by both the Navy and the Army. The Army was to procure its fifth and final JHSV in FY2012, and this ship was included in the Army’s FY2012 budget submission. In May 2011, the Navy and Army signed a Memorandum of Agreement (MOA) transferring the Army’s JHSVs to the Navy. In the FY2012 DOD Appropriations Act (Division A of H.R. 2055/P.L. 112-74 of December 23, 2011), the JHSV that was in the Army’s FY2012 budget submission was funded through the Shipbuilding and Conversion, Navy (SCN) appropriation account, along with the JHSV that the Navy had included in its FY0212 budget submission. The four JHSVs that were procured through the Army’s budget prior to FY2012, however, are not included in the annual totals shown in this table. Author Contact Information Ronald O'Rourke Specialist in Naval Affairs rorourke@crs.loc.gov, 7-7610 Congressional Research Service 48