Righting the ship: Coast Guard may face rough seas as it takes control of deepwater.

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A JUSTICE DEPARTMENT INVESTIGATION, A scathing 60 Minutes report, unsympathetic lawmakers and a stack of negative inspector general reports have marked the Coast Guard's Integrated Deepwater Systems program the last two years.

Coast Guard and industry officials believe they have some good news to report, and look forward to the day when the mix of 11 different ships, boats, aircraft--and the information technology backbone that ties it all together--starts delivering what they promised when the program was first conceived 11 years ago.

Despite the clouds hovering over the 25-year, $24.2 billion program, progress is being made, officials told National Defense. The first of the National Security Cutters is set for delivery next year. The aviation systems are on track and a "good news" story that hasn't been told, they added.

"It's going to be difficult to counter the bad publicity we've had despite the best efforts of our communications team," admitted J. Rocco Tomonelli, director of Coast Guard business development at Northrop Grumman.

Integrated Coast Guard Systems--the Northrop Grumman and Lockheed Martin consortium responsible for running the program until management was taken away from it and put in the hands of senior Coast Guard leadership--has borne the brunt of the criticism.

The Justice Department probe into a failed attempt to convert aging cutters into 123-foot boats threatens more bad headlines before the program can get out from under its "troubled" status. Nevertheless, The Coast Guard in July extended ICGS' contract for an additional 44 months.

The program's shortcomings have largely been blamed on a now discredited movement to allow contractors the leeway to manage and oversee defense acquisition programs. The consensus among government investigative arms is that the Coast Guard was ill-prepared to provide oversight as the mission requirements for the program changed and grew after 9/11. It simply did not have the bureaucracy required to keep tabs on such a complex and large integrated system with multiple programs.

Reasserting its oversight duties is an important and necessary step for the Coast Guard, defense experts agreed. However, that might be easier said than done.

"Conceptually, they've got all the right answers," said James Jay Carafano, assistant director of the Heritage Foundation. "The question is, 'do you have the horses to run the wagon?'" Key to the agency's efforts will be hiring the technocrats, inspectors and contract specialists needed to oversee the program, said defense experts.

"The Coast Guard commandant needs to spend about 1 percent of his time worrying about how ... integration is being done by people in the Coast Guard, and 99 percent of his time hiring the people to do the job," said Carafano.

There is no longer a large pool of qualified personnel for the service to draw from, said retired Rear Adm. Joe Carnevale, senior defense advisor to the Shipbuilders Council of America.

He blamed the Navy policies of the 1990s when it decided to shrink its own acquisition workforce. Not only did it lose a new generation of shipbuilding specialists who went on to choose other careers, but they also asked senior, more experienced personnel to retire early.

The Coast Guard has "got to have a sufficient staff of contracting, technical and quality assurance people within the government to make sure that these contracts stay on cost and schedule and provide the quality that they're asking for," Carnevale said.

The next generation of such specialists can be recruited, but it will be impossible to replace the cadre of experienced workers who moved on to other professions or retired, he added.

The Coast Guard finds itself competing for qualified staff with Naval Sea Systems Command, which is now trying to reverse its own misguided hiring and firing policies of the past, Carnevale said. The two organizations, however, have a cooperative relationship. And the Coast Guard has hired away a few of the Navy contract managers, he noted.

The workforce as of August totals more than 500 personnel, who are a mix of Coast Guard and civilian employees along with about 60 contractors, said Coast Guard spokesman George Kardulias. The Coast Guard has been authorized to fill an additional 50 positions. Beyond that, the service is awaiting the completion of a workforce requirements study due to be completed by the end of this year.

To the layman, more than 500 personnel may sound like a lot, but for a program of this size and complexity, it is far short of what's required, Kardulias said. "We need quite a few more to conduct the type of oversight that's been demanded of us."

Carafano said the Coast Guard's goal to increase its ranks further in the next 12 to 18 months is still "a big question mark."

Overall, Carafano and Carnevale said, the Coast Guard is taking the right steps to move the program forward.

"It's not like we can't not do this," Carafano said. "We've got to have ships and planes otherwise these guys are going to be going out there in rowboats."

The following is a partial list of the major acquisition programs the Coast Guard now oversees and where they stand:

National Security Cutter. The National Security Cutters will serve as the Coast Guard's command and control ships and are designed for extended missions far from U.S. shores.

The first to be delivered, the USCGC Bertholf, is scheduled to undergo builder's trials in October. As of early September, construction was more than 90 percent complete. These operational tests will determine the schedule for the acceptance trials, also known as sea trials, early next year before the cutter is handed over to the Coast Guard, said Kardulias. Integrated Coast Guard Systems should turn the ship over to the Coast Guard in August or September 2008.

The second cutter is more than 25 percent complete. After ICGS and the Coast Guard restructured the security cutter contracts in July, work began to cut the steel for the third ship.

The first two ships may have to undergo structural reinforcements five to seven years after they begin service life. "Design deficiencies" mean they may not be able to last their full 30 years. Fatigue cracks may appear in four key areas, especially if they are used extensively in the rough waters of the North Pacific, according to the Department of Homeland Security's inspector general. The "Acquisition of the National Security Cutter" report outlines a contentious debate between the inspector general's office and the Coast Guard on whether the service's leadership failed to correct the potential problem in the design phase.

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Kardulias said the potential flaws will not affect the safety of the crew, and will be corrected on cutters three through eight before they are built.

"It will be fully capable upon commission to do anything," he said. "It's just a matter of if it's going to do everything for 30 years, it needs to be strengthened a little bit."

Carnevale said it will take more than a "little bit" of work. It will be an expensive and complex task to fortify the ships. "If you're going to have to fix them, the longer you wait, the more expensive it gets--by a long shot," he said. It will involve major cuts in the ship, which will force the contractor to remove electronics and other "interferences," he said. "It's not a simple job. It's going to take a lot of work."

Fast Response Cutters. While the potential design deficiencies of the National Security Cutter has generated headlines, nothing has caused more damage to the reputation of Deepwater than the Fast Response Cutters and the plan to convert the service's 110-foot boats to 123-foot ships as stopgaps while a permanent ship was under development.

The plan to convert the 110-foot boats was a relatively small part of the overall program, Carafano noted. The first attempt to create a new boat from the ground up using a composite hull design was a mistake, Carafano said. But the Coast Guard is putting those issues behind it, he said. Meanwhile, the bad feelings on Capitol Hill remain, he noted.

A Justice Department probe also looms large. A DHS inspector report, "110'/123' Maritime Patrol Boat Modernization Project," detailed a whistleblower's allegations that ICGS failed to install safe and secure cables for the information technology system on the converted boats. The Coast Guard took delivery of four of the boats, which were later found to have structural problems, and were taken out of service. The structural issues were a separate matter, but that further damaged the program's reputation. Scrapping the boats cost taxpayers an estimated $87 million to $100 million, according to the Congressional Research Service.

In May, the Coast Guard took over the acquisition process from ICGS. The service is now looking for a commercial-off-the-shelf solution called the Fast Response Cutter-B.

Boatmakers have submitted their proposals and a decision on the winner should come in spring of 2008, Kardulias said.

The request calls for a 120- to 160-foot boat that can travel at speeds of at least 28 knots. Current plans call for 58 fast response cutters, at least 12 of them FRC-Bs, and the remaining--FRCAs--presumably would be the result of a new design that does not involve a composite hull. Aviation. "The aircraft have been a success story all along, but it's not been reported," said Kardulias.

Indeed, the Government Accountability Office and the DHS inspector general have mostly been silent on the aviation platforms.

The Deepwater plan calls for a mix of fixed and rotary wing aircraft and two different unmanned aerial vehicles. The first of the new aviation platforms is the medium range maritime patrol aircraft, the HC-144A, based on the FADS CASA HC-235 Persuader aircraft. EADS has delivered three of the turbo-prop planes to the Coast Guard of a planned 36, Kardulias said.

The MPAs will replace the service's fleet of aging HU-25 Falcon jets. They will be able to fly 8.7 hours as opposed to the Falcon's 5.7 hours and perform reconnaissance and surveillance, as well as rescue missions by dropping inflatable boats.

The first two aircraft are being converted to Coast Guard specifications and undergoing operational tests. The first is scheduled to enter service late this year.

Conversions of the HH-65B Dolphin--called the "workhorse" of the Coast Guard's helicopters--to a C-model was completed one month ahead of a congressionally mandated deadline this summer. As of September, 92 of 95 aircraft had received new, more powerful engines, a .50 caliber precision fire weapon and a M240B 7.62 machine gun, along with other upgrades.

The weapon systems were among the many changes called for in the wake of 9/11. Weapons will be used to intercept fast drug smuggling boats.

Mark Gaspar, director of Coast Guard Systems at Lockheed Martin, said, "The HH-65C has already had some rescues that could not have been accomplished with the Baker models. There are human beings alive today" because of it, he said. The first three converted helicopters saw action during Hurricane Katrina, he added.

Information technology and communications. The devil is in the details, and for a program such as Deepwater, the details are the communication and operating systems that are supposed to seamlessly tie all the ships, helicopters and shore facilities together. Better known as C4ISR--command, control, communications, computers and intelligence, surveillance and reconnaissance--the military services have struggled in the past to integrate computers and communications devices.

Coast Guard and ICGS officials blame some of the program's woes on the increased set of missions imposed in the wake of 9/11. One example is the National Security Cutter's tower, which was originally envisioned as hosting about eight antennas and sensors. Now, there are 36.

The need for secure communications and interoperability with the Navy and more than 100 federal agencies is one reason for the added antennas. Pilots, ship officers and those ashore are all supposed to be able to see the same information on their computers screens, the so-called "common operating picture."

Gaspar said the Coast Guard's 39 current cutters are all being retrofitted with a suite of secure communication systems, as have the HH-65C helicopters.

To mitigate glitches and save funds, ICGS is reusing software developed for the Navy's CVN-77 George H.W. Bush aircraft carrier, christened in October 2006, Gaspar said.

Since not all of the platforms have been built, it remains to be seen if it will all work as planned.

A key test will be the second of two builder's trials late this year when the National Security Cutter will flip the switch on its C4ISR assets while at sea. The second trial will be dedicated to testing the new systems, Kardulias said.

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RELATED ARTICLE: Coast Guard reconsiders unmanned aircraft choice.

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THE COAST GUARD HAS halted development of the Eagle Eye vertical unmanned aerial vehicle and is considering other hovering drones for its Integrated Deepwater Systems program, according to agency and industry sources.

Conceived to fly from the yet to be deployed National Security Cutter, the Eagle Eye is designed to provide long-range over the horizon intelligence, reconnaissance and surveillance.

The order to halt work was mostly "due to financial priorities," said Coast Guard spokesman George Kardulias. "Based on the budget we had to operate with, focus has been put on things needed more immediately such as ships and manned airplanes."

A contractor who works at Coast Guard headquarters said other unmanned aircraft are being considered.

"The Coast Guard is looking at other alternatives as a bridge ... because the Coast Guard does want a UAV that lifts off from the cutters," said the contractor, who declined to be named.

"In a couple years, there could be a quick jump [in technology] to something that is a lot less expensive, a lot simpler and does the same job."

Meanwhile, the Coast Guard is completing work on a two-phase study "re-examining the way ahead for unmanned vehicles," said Coast Guard Rear Adm. Gary T. Blore, testifying in May before the House Committee on Homeland Security.

Current plans call for the Coast Guard to lease four RQ-4A Global Hawk high altitude endurance UAVs, but that is probably being re-examined as well, Kardulias said.

The Eagle Eye has tilt rotors, similar to the Marine Corps' V-22 Osprey, which is built by the same contractor, Bell Helicopter of Fort Worth, Texas. Up to four could be deployed on a National Security Cutter, depending on the mission.

On the technical side, the Eagle Eye program is in good shape, said Mark Gaspar, director of Lockheed Martin Coast Guard systems. The program "could be picked up and proceed just by turning it back on again." Lockheed Martin and Northrop Grumman are partners in the Integrated Coast Guard Systems, the lead contractor on the program.

Gaspar also suggested that an alternative is being considered.

"Whether it is the Bell Eagle Eye or the Fire Scout that Northrop Grumman produces, the enterprise needs those over the horizon eyes in order to be fully effective," he said.

The MQ-8B Fire Scout, a Navy rotary-wing UAV built by Northrop Grumman, like the Eagle Eye, is designed to take off and land from ships. Last summer, the Navy demonstrated the aircraft's ability to autonomously land on a moving ship. It is slated to be a part of the Navy's littoral combat ship, which like the National Security Cutter, is in the late stages of development.

Plans call for 45 Eagle Eyes to be delivered during the course of the 25-year program, with the first production prototype to arrive in the fall of 2008. Due to the budget constraints, that timeline will not be met. With the first cutter, the Bertholf, scheduled for delivery next year, it appears it will sail without a VUAV. Kardulias said that the ship's helicopters can duplicate the reconnaissance and surveillance mission.

However, Gaspar said the drones significantly extend the cutter's reach. A conventional helicopter can cover about 9,000 nautical square miles opposed to a UAV, which can extend that to 56,000 nautical square miles and do so at a much lower operating cost.

One Eagle Eye crashed during a test flight in April 2006. Margaret Mitchell-Jones, ICGS spokeswoman, said this test was done with a prototype drone at Bell's own expense, and therefore, the accident should not be associated with the Deepwater program. The actual Eagle Eye configured for the Coast Guard has not yet been assembled, added Gaspar.

Bell spokesman Mike Cox said that the Eagle Eye meets all the technical requirements spelled out in the contract and it is the company's understanding that the delay is for budgetary reasons. He referred further questions to Coast Guard headquarters.

A Department of Homeland Security inspector general's report said "technical and contractual problems" have hindered the VUAV program. "The VAUVs do not have the kind of detection and collision avoidance technology required to operate within national airspace, and would therefore be limited to fly outside of zones used by manned aircraft."

National airspace is defined as the area controlled by the Federal Aviation Administration's air traffic control system. The FAA, so far, has been cautious in allowing UAVs to fly domestically. However, the National Security Cutter is mostly intended for international missions far from U.S. shores.

The report did not mention any further technical hurdles, but did hint at possible problems that have plagued Deepwater in the past--namely a lack of oversight.

"The performance based contract that is being used to procure the VAUVs can result in errors in 'translation' between government needs and the requirements that are included in the contract," the IG said.

The Coast Guard has said it is hiring the personnel needed to oversee the Deepwater programs.

--STEW MAGNUSON