Defense Infrastructure
Ability of Ship Maintenance Industrial Base to Support a Nuclear Aircraft Carrier at Naval Station Mayport Gao ID: GAO-11-388R March 29, 2011Since established as a naval base in December 1942, Naval Station Mayport, Florida, as grown to become the third largest naval fleet concentration area in the United States and the second largest on the East Coast. During this time, the base has served as the home port for multiple types of Navy surface ships--reaching a peak of over 30 ships including two conventional carriers in 1987. The most recent conventionally powered carrier to be homeported there--the USS John F. Kennedy--was decommissioned in 2007. Prior to the USS John F. Kennedy's retirement, the Department of Defense's (DOD) 2001 Quadrennial Defense Review called for the Navy to provide more warfighting assets more quickly to multiple locations, and, to meet this requirement, the Navy made a preliminary decision to homeport additional surface ships at Mayport. The Navy subsequently prepared an environmental impact statement to evaluate a broad range of strategic home port and dispersal options for Atlantic Fleet surface ships in Mayport and on January 14, 2009, issued its decision to pursue an option that would include the first-time homeporting of a nuclear-powered aircraft carrier at Mayport. The Navy's decision was reviewed as part of the 2010 Quadrennial Defense Review, which in its report supported the Navy's decision to homeport a nuclear-powered aircraft carrier in Mayport, indicating that homeporting an East Coast carrier in Mayport would contribute to mitigating the risk of a terrorist attack, accident, or natural disaster occurring in Norfolk, Virginia, where currently all of the nuclear-powered aircraft carriers on the East Coast are homeported. In House Report 111-491, accompanying a proposed bill for the Fiscal Year 2011 National Defense Authorization Act (H.R. 5136), the House Committee on Armed Services directed the Secretary of the Navy to report by December 15, 2010, to the congressional defense committees on (1) the ability of the private ship maintenance industrial base in northeast Florida to support nuclear-powered aircraft carrier maintenance requirements; (2) the likely costs to the Navy that could result from establishing such maintenance capabilities within the local industrial base; and (3) the impacts on cost and workforce scheduling that could result if the Navy must provide the maintenance workforce from another nuclear-powered aircraft carrier home-port location. The Navy issued its report to the congressional defense committees on December 29, 2010.5 In the same House report, the committee also directed GAO to assess and report on the Secretary of the Navy's report within 90 days of receiving the Navy's report and to conduct an assessment of aspects of the local ship maintenance industrial base and determine to what extent the homeporting of a carrier at Mayport would affect carrier maintenance costs. In response to the House report, our objectives were to determine to what extent (1) the private ship repair firms in northeast Florida can meet the maintenance requirements of a nuclear-powered aircraft carrier and (2) the Navy's December 2010 report addresses the provisions directed by House Report 111-491. The House report also directed us to assess how the construction of maintenance facilities for a nuclear-powered aircraft carrier at Naval Station Mayport will affect maintenance costs for the carrier, including recurring and nonrecurring costs over a 10-year budget window.
Private ship repair firms in northeast Florida will likely be able to support the maintenance requirements of a nuclear aircraft carrier if one is homeported at Naval Station Mayport in 2019 as the Navy plans. Of the 20 surface ships currently homeported at Mayport, the Navy plans to decommission 12 guided-missile frigates between 2011 and 2015. According to the Navy, the total depot maintenance workload at Mayport has averaged 225,000 work days per year over the last several years. The Navy estimates that the decommissioning of the frigates will reduce this average workload by about 135,200 work days after all of the frigates have been decommissioned in 2015--a potential decrease of 60 percent if no other work is allocated to Mayport. According to private ship repair firm representatives, this decrease in workload will likely result in the loss of some jobs for ship repair firms in northeast Florida, but the Navy expects the private ship repair firms to be able to support a nuclear-powered aircraft carrier in 2019 for five key reasons. (1) The Navy has implemented mitigation measures to offset the decreased workload, such as transferring the maintenance of three barges from Norfolk Naval Shipyard to Mayport. (2) The northeast Florida area is home to three master ship repair firms certified by the Navy to have the capabilities and capacities to support the maintenance requirements of U.S. Navy surface ships, including aircraft carriers. (3) The tasks required of the private ship repair firms to support a nuclear carrier are the same as those performed on conventional carriers in the past and the other types of ships currently homeported at Mayport. (4) Private ship repair firms in northeast Florida have previously demonstrated the ability to support carrier maintenance. (5) Finally, according to the Navy, the contracting strategy used with the private ship repair firms provides the firms with early visibility into the Navy's maintenance planning, thus allowing the firms to appropriately size their workforces in anticipation of future workload. We found that the Navy could have provided clearer and more complete responses in its December 2010 report on the ability of private ship repair firms in northeast Florida to support nuclear-powered aircraft carrier maintenance requirements at Naval Station Mayport by including additional information that could help provide Congress with a better understanding of its conclusions regarding the sufficiency of the capabilities and capacities of ship repair firms near or around Naval Station Mayport to support the maintenance requirements of a nuclearpowered aircraft carrier. First, regarding the ability of the private ship repair firms to support a carrier, the Navy discussed the capabilities of the various firms, but the report did not fully provide information on the maintenance requirements of a nuclearpowered carrier and how that work would be allocated to the private sector. Second, regarding the costs to establish additional ship repair maintenance capabilities in northeast Florida, the Navy's report discussed the types of maintenance work performed by the various ship repair firms and concluded that no additional costs would be incurred as the various firms already have the required capabilities, however, the report does not provide the full context to the reader to support the report's conclusion. Third, regarding impacts on costs and workforce scheduling, the Navy reported on the maintenance workload associated with a nuclear aircraft carrier and the potential cost to the Navy if the public shipyards needed to perform 10 percent more of the work than anticipated, but the report did not fully discuss the Navy's workforce-shaping procedures and the One Shipyard concept, which helps ensure that the required number of workers and skill sets are available when needed to meet current and planned maintenance requirements. We are not making any recommendations in this correspondence.
GAO-11-388R, Defense Infrastructure: Ability of Ship Maintenance Industrial Base to Support a Nuclear Aircraft Carrier at Naval Station Mayport
This is the accessible text file for GAO report number GAO-11-388R
entitled 'Defense Infrastructure: Ability of Ship Maintenance
Industrial Base to Support a Nuclear Aircraft Carrier at Naval Station
Mayport' which was released on March 29, 2011.
This text file was formatted by the U.S. Government Accountability
Office (GAO) to be accessible to users with visual impairments, as
part of a longer term project to improve GAO products' accessibility.
Every attempt has been made to maintain the structural and data
integrity of the original printed product. Accessibility features,
such as text descriptions of tables, consecutively numbered footnotes
placed at the end of the file, and the text of agency comment letters,
are provided but may not exactly duplicate the presentation or format
of the printed version. The portable document format (PDF) file is an
exact electronic replica of the printed version. We welcome your
feedback. Please E-mail your comments regarding the contents or
accessibility features of this document to Webmaster@gao.gov.
This is a work of the U.S. government and is not subject to copyright
protection in the United States. It may be reproduced and distributed
in its entirety without further permission from GAO. Because this work
may contain copyrighted images or other material, permission from the
copyright holder may be necessary if you wish to reproduce this
material separately.
GAO-11-388R:
United States Government Accountability Office:
Washington, DC 20548:
March 29, 2011:
Congressional Committees:
Subject: Defense Infrastructure: Ability of Ship Maintenance
Industrial Base to Support a Nuclear Aircraft Carrier at Naval Station
Mayport:
Since established as a naval base in December 1942, Naval Station
Mayport, Florida,[Footnote 1] as grown to become the third largest
naval fleet concentration area in the United States and the second
largest on the East Coast. During this time, the base has served as
the home port for multiple types of Navy surface ships--reaching a
peak of over 30 ships including two conventional carriers in 1987. The
most recent conventionally powered carrier to be homeported there--the
USS John F. Kennedy--was decommissioned in 2007. Prior to the USS John
F. Kennedy's retirement, the Department of Defense's (DOD) 2001
Quadrennial Defense Review called for the Navy to provide more
warfighting assets more quickly to multiple locations, and, to meet
this requirement, the Navy made a preliminary decision to homeport
additional surface ships at Mayport. The Navy subsequently prepared an
environmental impact statement to evaluate a broad range of strategic
home port and dispersal options for Atlantic Fleet surface ships in
Mayport and on January 14, 2009, issued its decision to pursue an
option that would include the first-time homeporting of a nuclear-
powered aircraft carrier at Mayport. The Navy's decision was reviewed
as part of the 2010 Quadrennial Defense Review, which in its report
supported the Navy's decision to homeport a nuclear-powered aircraft
carrier in Mayport, indicating that homeporting an East Coast carrier
in Mayport would contribute to mitigating the risk of a terrorist
attack, accident, or natural disaster occurring in Norfolk, Virginia,
where currently all of the nuclear-powered aircraft carriers on the
East Coast are homeported.[Footnote 2]
In House Report 111-491, accompanying a proposed bill for the Fiscal
Year 2011 National Defense Authorization Act (H.R. 5136), the House
Committee on Armed Services directed the Secretary of the Navy to
report by December 15, 2010, to the congressional defense committees
on:
* the ability of the private ship maintenance industrial base[Footnote
3] in northeast Florida to support nuclear-powered aircraft carrier
maintenance requirements;
* the likely costs to the Navy that could result from establishing
such maintenance capabilities within the local industrial base; and:
* the impacts on cost and workforce scheduling that could result if
the Navy must provide the maintenance workforce from another nuclear-
powered aircraft carrier home-port location.[Footnote 4]
The Navy issued its report to the congressional defense committees on
December 29, 2010.[Footnote 5] In the same House report, the committee
also directed GAO to assess and report on the Secretary of the Navy's
report within 90 days of receiving the Navy's report and to conduct an
assessment of aspects of the local ship maintenance industrial base
and determine to what extent the homeporting of a carrier at Mayport
would affect carrier maintenance costs. In response to the House
report, our objectives were to determine to what extent (1) the
private ship repair firms in northeast Florida can meet the
maintenance requirements of a nuclear-powered aircraft carrier and (2)
the Navy's December 2010 report addresses the provisions directed by
House Report 111-491. The House report also directed us to assess how
the construction of maintenance facilities for a nuclear-powered
aircraft carrier at Naval Station Mayport will affect maintenance
costs for the carrier, including recurring and nonrecurring costs over
a 10-year budget window. In March 2011, we issued a report providing
our independent cost estimate of the full life-cycle costs of
establishing a nuclear aircraft carrier home port at Mayport, a report
that includes our response to this objective.[Footnote 6] We have
included a summary of that report, including the total recurring and
nonrecurring costs over a 10-year budget period, in enclosure I.
Scope and Methodology:
To determine the extent to which the private ship repair firms in
northeast Florida can meet the maintenance requirements of a nuclear-
powered aircraft carrier, we analyzed Navy workload data to determine
the impact of the Navy's proposed ship decommissioning and homeporting
plans at Naval Station Mayport and reviewed historical evidence on the
ability of the private ship repair firms to meet Navy nuclear-carrier
maintenance requirements. We also reviewed various Navy documents
related to the maintenance and workload requirements of nuclear-
powered aircraft carriers, including the Office of the Chief of Naval
Operations Instruction 4700.7L on the Maintenance Policy for United
States Navy Ships; the Office of the Chief of Naval Operations Notice
4700 on the Representative Intervals, Durations, and Repair Mandays
[Footnote 7] for Depot Level Maintenance Availabilities of U.S. Navy
Ships; and the CVN 68 Aircraft Carrier Class Maintenance Plan[Footnote
8]. We also interviewed Navy officials to determine private-sector
nuclear aircraft carrier maintenance requirements. We did not include
in our review the work performed on the carrier's nuclear propulsion
plant and its associated systems by the public shipyard workforce
[Footnote 9] as that work is not supported by private ship repair
firms.[Footnote 10] To further evaluate the Navy's maintenance
requirements and the infrastructure needed to support nuclear-powered
aircraft carriers, we interviewed officials and visited facilities at
Norfolk Naval Shipyard, Virginia, and Naval Air Station North Island,
California. During our visits, we discussed the infrastructure
upgrades made at these locations to berth and homeport nuclear-powered
aircraft carriers. We interviewed Navy officials and visited
facilities at Naval Station Mayport, Florida, to determine the extent
of the upgrades planned at the station to support homeporting of a
nuclear-powered aircraft carrier. We met with representatives from
private sector ship repair firms in northeast Florida, such as BAE
Systems Southeast Shipyards Jacksonville, Earl Industries, North
Florida Shipyards, Inc., and others to discuss their capabilities and
capacities to support the maintenance requirements of a nuclear-
powered aircraft carrier and the possible impacts of decommissioning
the frigates on the private firms' business operations. We also met
with regional ship repair trade associations in Norfolk, Virginia, and
Mayport, Florida, and the national private ship repair trade
association in Washington, D.C., to discuss any potential impacts
resulting from a nuclear aircraft carrier move to Mayport on the
private ship repair industry.
To determine the extent to which the Navy's report addresses the
provisions directed by House Report 111-491, we reviewed the Navy's
report and assessed whether the Navy provided clear and complete
responses and the necessary information as directed by the House
report. As part of our assessment, we obtained and analyzed documents
used by the Navy to develop its responses. In addition, we compared
the Navy's responses to information and data we collected during our
own independent review of the capability of the private ship repair
firms in northeast Florida to support the maintenance requirements of
a nuclear-powered aircraft carrier and the costs associated with
homeporting a carrier at Naval Station Mayport. Where appropriate, we
assessed the extent to which the Navy's report addressed the
provisions as directed by the House report and discussed those areas
that we believed were not fully addressed with officials responsible
for the development of the Navy's report.
We conducted this performance audit from July 2010 to March 2011, in
accordance with generally accepted government auditing standards.
Those standards require that we plan and perform the audit to obtain
sufficient, appropriate evidence to provide a reasonable basis for our
findings and conclusions based on our audit objectives. We believe
that the evidence obtained provides a reasonable basis for our
findings and conclusions based on our audit objectives.
Summary:
Private ship repair firms in northeast Florida will likely be able to
support the maintenance requirements of a nuclear aircraft carrier if
one is homeported at Naval Station Mayport in 2019 as the Navy plans.
Of the 20 surface ships currently homeported at Mayport, the Navy
plans to decommission 12 guided-missile frigates between 2011 and
2015. According to the Navy, the total depot maintenance workload at
Mayport has averaged 225,000 work days per year over the last several
years. The Navy estimates that the decommissioning of the frigates
will reduce this average workload by about 135,200 work days after all
of the frigates have been decommissioned in 2015--a potential decrease
of 60 percent if no other work is allocated to Mayport. According to
private ship repair firm representatives, this decrease in workload
will likely result in the loss of some jobs for ship repair firms in
northeast Florida, but the Navy expects the private ship repair firms
to be able to support a nuclear-powered aircraft carrier in 2019 for
five key reasons.
* The Navy has implemented mitigation measures to offset the decreased
workload, such as transferring the maintenance of three barges from
Norfolk Naval Shipyard to Mayport. These measures will likely not
fully offset the decreased workload, but the Navy has stated it is
continuing to explore other mitigation options, such as the
homeporting of some littoral combat ships.[Footnote 11] Additionally,
the Navy expects the proposed homeporting of a nuclear aircraft
carrier at Mayport in 2019 to further increase the workload at Mayport
by an average of 28,800 work days per year.
* The northeast Florida area is home to three master ship repair firms
certified by the Navy to have the capabilities and capacities to
support the maintenance requirements of U.S. Navy surface ships,
including aircraft carriers. Each of these firms has significant
production and administrative facilities either on or near Naval
Station Mayport, and officials from these firms told us they will
maintain their presence in northeast Florida. Additionally, these
private ship repair officials told us they have options by which they
can adjust to fluctuations in workload. For example, two of the firms
have ship repair personnel at other Navy home ports that could be used
to supplement the firms' workforces at Mayport during workload
increases or used to transfer personnel during workload decreases.
Similarly, there is a large transient, temporary ship repair workforce
that can be used to supplement each of the ship repair firm's full-
time workforce as needed. Because of these options, private ship
repair firm officials told us that although they are concerned over
the projected decrease in workload, workload fluctuations are common
in the ship repair industry and their firms would be able to withstand
any lulls in workload at Mayport and that it would not impact their
ability to support a nuclear carrier beginning in 2019.
* The tasks required of the private ship repair firms to support a
nuclear carrier are the same as those performed on conventional
carriers in the past and the other types of ships currently homeported
at Mayport.
* Private ship repair firms in northeast Florida have previously
demonstrated the ability to support carrier maintenance. In fact, the
largest aircraft carrier availability ever performed outside of a
public shipyard was completed on the USS John F. Kennedy in Mayport in
2003.
* Finally, according to the Navy, the contracting strategy used with
the private ship repair firms provides the firms with early visibility
into the Navy's maintenance planning, thus allowing the firms to
appropriately size their workforces in anticipation of future workload.
The Navy's December 2010 report on the ability of private ship repair
firms in northeast Florida to support nuclear-powered aircraft carrier
maintenance requirements at Naval Station Mayport generally addressed
the three provisions as directed in House Report 111-491, but we found
that the Navy could have provided clearer and more complete responses
in its report by including additional information that could help
provide Congress with a better understanding of its conclusions
regarding the sufficiency of the capabilities and capacities of ship
repair firms near or around Naval Station Mayport to support the
maintenance requirements of a nuclear-powered aircraft carrier.
* First, regarding the ability of the private ship repair firms to
support a carrier, the Navy discussed the capabilities of the various
firms, but the report did not fully provide information on the
maintenance requirements of a nuclear-powered carrier and how that
work would be allocated to the private sector. Including such
information would have provided additional support for the Navy's
conclusion that the various firms have sufficient capabilities to
support a nuclear carrier. Also, the report did not fully address the
impact of the decreasing Navy ship workload on the various private
ship repair firms and whether this decrease would affect their ability
to meet the maintenance requirements of a nuclear aircraft carrier.
* Second, regarding the costs to establish additional ship repair
maintenance capabilities in northeast Florida, the Navy's report
discussed the types of maintenance work performed by the various ship
repair firms and concluded that no additional costs would be incurred
as the various firms already have the required capabilities, however,
the report does not provide the full context to the reader to support
the report's conclusion. Specifically, the report did not explain the
differences between propulsion plant and related systems and
nonpropulsion plant maintenance work. Nor did it explain the Navy's
use of public shipyard employees to accomplish the propulsion plant
maintenance and private ship repair firms to accomplish nonpropulsion
plant maintenance or describe the capabilities needed to accomplish
those tasks. Including the differences between propulsion plant and
nonpropulsion plant maintenance and the Navy's strategy to accomplish
this work would have further explained the Navy's conclusion that the
private ship repair firms already have the capabilities to support the
nonpropulsion maintenance requirements of a nuclear aircraft carrier
and that there would not be any need for additional capabilities
within the local industrial base.
* Third, regarding impacts on costs and workforce scheduling, the Navy
reported on the maintenance workload associated with a nuclear
aircraft carrier and the potential cost to the Navy if the public
shipyards needed to perform 10 percent more of the work than
anticipated, but the report did not fully discuss the Navy's workforce-
shaping procedures and the One Shipyard concept, which helps ensure
that the required number of workers and skill sets are available when
needed to meet current and planned maintenance requirements.[Footnote
12] This information would have provided the reader with better
context to understand the Navy's potential workforce-scheduling
strategies and any impacts that could result if the Navy must provide
the maintenance workforce from another home-port location than
Mayport. Although the responses in the Navy's report could have been
clearer and more complete, the additional information lacking in the
report is available in other sources including two other recent Navy
reports previously issued to Congress or the congressional defense
committees--one on the assessment of the U.S. ship repair industrial
base[Footnote 13] and the other on homeporting alternatives for
Mayport,[Footnote 14] as well as in this report and other reports we
have recently issued on the Mayport carrier homeporting proposal.
We are not making any recommendations in this correspondence. After
reviewing a draft of this product, DOD officials said that the
department had no comments.
Background:
Nuclear-Powered Aircraft Carrier Maintenance:
The U.S. Navy currently maintains 11 nuclear aircraft carriers--5
homeported on the West Coast of the United States, 5 on the East Coast
of the United States, and 1 in Yokosuka, Japan. Of the West Coast
carriers, three are homeported in San Diego, California; one in
Bremerton, Washington; and one in Everett, Washington. All five of the
East Coast carriers are homeported in Norfolk, Virginia. As some of
the most technologically advanced ships in the world, nuclear aircraft
carriers require continuous and regularly scheduled maintenance to
keep them ready to meet mission requirements. The Navy identifies
three levels of aircraft carrier maintenance:
* Organizational--The ship's crew performs as-needed, routine tasks
such as replacing minor parts, lubricating machinery, and preventive
inspections.
* Intermediate--Navy and civilian personnel from designated facilities
use specialized skills to conduct more extensive work on a schedule of
periodic cycles.
* Depot--Personnel at public and private shipyards perform maintenance
that requires skills, facilities, or capacities normally beyond those
of the organizational and intermediate levels, including ship
overhauls, alterations, refits, restorations, and nuclear refueling.
Depot-level maintenance periods, also known as availabilities, require
the most resources and personnel of the three levels of nuclear
aircraft carrier maintenance. There are four types of depot-level
availabilities:
* carrier incremental availabilities lasting approximately 1 month
each and performed twice in every 32-month operating cycle;
* planned incremental availabilities lasting approximately 6 months
each and performed once in a 32-month operating cycle unless a docking
planned incremental availability is scheduled;
* docking planned incremental availabilities lasting about 10.5 months
each and performed after two consecutive cycles when planned
incremental availabilities were performed; and:
* refueling complex overhaul lasting about 39 months and performed
once near the mid-life of the carrier, at around 23 years of the
carrier's service life.
Over its expected 50-year service life, a nuclear carrier will undergo
a total of 32 carrier incremental availabilities, 12 planned
incremental availabilities, 4 docking planned incremental
availabilities and one refueling complex overhaul as shown in figure 1.
Figure 1: Depot-level Availability Maintenance Schedule of a Nuclear-
Powered Aircraft Carrier over Its Expected 50-Year Service Life:
[Refer to PDF for image: illustration]
First half of aircraft carrier service life: 23.5 years:
PAI: 1;
CIA: 1;
CIA: 2;
PAI: 2;
CIA: 3;
CIA: 4;
DPIA: 1;
CIA: 5;
CIA: 6;
PAI: 3;
CIA: 7;
CAI: 8;
PAI: 4;
CIA: 9;
CIA: 10;
DPIA: 2;
CIA: 11;
CIA: 12;
PIA: 5;
CIA: 13;
CAI: 14;
PIA: 6;
CIA: 15;
CIA: 16.
Midpoint of aircraft carrier service life: RCOH (duration 39 months).
Second half of aircraft carrier service life: 23.5 years:
CIA: 17;
CIA: 18;
PIA: 7;
CIA: 19;
CIA: 20;
PIA: 8;
CIA: 21;
CIA: 22;
DPIA: 3;
CIA: 23;
CIA: 24;
PIA: 9;
CIA: 25;
CIA: 26;
PIA: 10;
CIA: 27;
CIA: 28;
DPIA: 4;
CIA: 29;
CIA: 30;
PAI: 11;
CIA: 31;
CIA: 32;
PAI: 12.
Depot-level availability:
PIA: Planned Incremental Availability (Duration 6 months, 269,000 work
days).
CIA: Carrier Incremental Availability (Duration 1 month, 10,000 work
days).
DPIA: Docking Planned Incremental Availability (Duration 10.5 months,
444,000 work days).
RCOH: Refueling Complex Overhaul (Duration 39 months, 3,267,000 work
days).
Source: GAO analysis of Navy's nuclear-powered carrier maintenance
planning documents.
Note: The number below each depot-level availability type indicates
the particular sequential availability perforated of that type during
the service life of the carrier.
[End of figure]
The Navy's maintenance policy for ships indicates that scheduled
private sector carrier and planned incremental availabilities shall
normally be performed in the ship's home-port area.[Footnote 15]
However, as Naval Station Mayport does not have dry docking capability
for nuclear-powered aircraft carriers, a carrier homeported there
would have to travel to Norfolk Naval Shipyard or Northrop Grumman
Shipbuilding Newport News to undergo docking planned incremental
availabilities and the one-time mid-life refueling complex overhaul,
respectively.
Nonpropulsion Plant Maintenance and Propulsion Plant Maintenance:
The maintenance work conducted during these depot-level availabilities
is separated between nonpropulsion plant work and propulsion plant
work. Nonpropulsion plant work consists of maintenance work on systems
outside of the propulsion plant, or nuclear reactors and related
systems, of an aircraft carrier. This type of work--sometimes called
"topside work"--is almost entirely performed by the private sector.
Types of nonpropulsion plant work performed by the private sector
include:
* flight deck and hangar deck resurfacing;
* cabin repairs and upgrades--including deck resurfacing, restroom
repairs and upgrades, and berthing compartment repairs and upgrades;
* aircraft and weapons elevators repairs and upgrades;
* hull and structural corrosion control, preservation, and repairs;
* steam system repairs and modifications--including piping repair and
replacement, and valve repair and replacement;
* electrical distribution system repairs and modifications--including
circuit breakers and generators; and:
* ventilation system cleaning, preservation, corrosion control, and
repairs to ducting, valves, and motors.
Propulsion plant work, on the other hand, consists of maintenance and
repairs related to the carrier's nuclear reactors and associated
systems that are largely performed in a controlled environment. This
type of work is primarily performed by public shipyard personnel.
Public shipyard personnel can also perform the nonpropulsion plant
work performed by the private sector if needed. In order to support
the required propulsion plant work, additional facilities will need to
be constructed at Naval Station Mayport, including a controlled
industrial facility that is used for the inspection, modification, and
repair of radiologically controlled equipment and components. During
the carrier and planned incremental availabilities, public shipyard
personnel (most likely from Norfolk Naval Shipyard) will travel to
Naval Station Mayport to perform the propulsion plant-related work.
The propulsion plant maintenance strategy for Mayport is based on the
model that has been used for nuclear carriers homeported at North
Island Naval Air Station, San Diego, where public shipyard personnel
(normally from Puget Sound Naval Shipyard) travel to North Island to
perform this work during carrier and planned incremental
availabilities.
Private Ship Repair Firms in Northeast Florida Will Likely Be Able to
Support the Maintenance Requirements of a Nuclear Aircraft Carrier:
Private ship repair firms in northeast Florida will likely be able to
support the maintenance requirements of a nuclear aircraft carrier if
one is homeported at Naval Station Mayport in 2019 as the Navy plans.
Of the 20 surface ships currently homeported at Mayport, the Navy
plans to decommission 12 guided-missile frigates between 2011 and
2015. The Navy estimates that these decommissionings could reduce the
total maintenance workload by about 60 percent if no other work is
allocated to Mayport and, as a result, has implemented some mitigation
measures to help offset the decreased workload and is considering
others. Additionally, the Navy expects the proposed homeporting of a
nuclear aircraft carrier at Mayport in 2019 to further increase the
workload at Mayport by an average of 28,800 work days per year. In the
near term, although the decreased workload from the frigates'
retirements may result in the loss of some ship repair jobs, the
decrease is not expected to affect the ship repair firms' ability to
support a carrier. All of the firms have demonstrated the capability
and capacity to work on naval ships, including performing large-scoped
conventional aircraft carrier availabilities and have options
available to increase capacity during workload surges, such as
utilizing temporary workers and overtime for full-time workers.
Additionally, private ship repair officials told us that although they
are concerned over the projected decrease in workload, workload
fluctuations are common in the ship repair industry and their firms
would be able to withstand any lulls in workload at Mayport, and that
any workload decreases would not impact their ability to support a
nuclear carrier at Mayport.
Decommissioning of Guided-Missile Frigates Will Reduce Maintenance
Workload at Mayport, but Navy Has Implemented Mitigation Measures and
Is Considering Others:
The planned decommissioning of the guided-missile frigates currently
at Mayport will reduce the total maintenance workload at Mayport, but
the Navy has implemented several mitigation measures and is actively
exploring others. Of the 20 surface ships currently homeported at
Mayport, the Navy plans to decommission 12 guided-missile frigates
between 2011 and 2015. According to the Navy, the total depot
maintenance workload at Mayport has averaged 225,000 work days per
year over the past several years. The Navy estimates that the
decommissioning of the frigates will reduce the total annual workload
by about 135,200 work days after all the frigates have been
decommissioned in 2015--a potential decrease of 60 percent if no other
maintenance work is allocated to Mayport. Table 1 shows the planned
decommissioning schedule for the guided-missile frigates at Naval
Station Mayport.
Table 1: Navy's Schedule for Decommissioning Guided-Missile Frigates
Homeported at Naval Station Mayport, as of December 2010:
Hull number: FFG 39;
Ship name: USS Doyle;
Fiscal year to be decommissioned: 2011.
Hull number: FFG 28;
Ship name: USS Boone;
Fiscal year to be decommissioned: 2012.
Hull number: FFG 29;
Ship name: USS Stephen W. Groves;
Fiscal year to be decommissioned: 2012.
Hull number: FFG 32;
Ship name: USS John L. Hall;
Fiscal year to be decommissioned: 2012.
Hull number: FFG 36;
Ship name: USS Underwood;
Fiscal year to be decommissioned: 2013.
Hull number: FFG 42;
Ship name: USS Klakring;
Fiscal year to be decommissioned: 2013.
Hull number: FFG 40;
Ship name: USS Halyburton;
Fiscal year to be decommissioned: 2014.
Hull number: FFG 45;
Ship name: USS De Wert;
Fiscal year to be decommissioned: 2014.
Hull number: FFG 49;
Ship name: USS Robert G. Bradley;
Fiscal year to be decommissioned: 2014.
Hull number: FFG 50;
Ship name: USS Taylor;
Fiscal year to be decommissioned: 2015.
Hull number: FFG 56;
Ship name: USS Simpson;
Fiscal year to be decommissioned: 2015.
Hull number: FFG 58;
Ship name: USS Samuel B. Roberts;
Fiscal year to be decommissioned: 2015.
Source: Navy.
[End of table]
In response to the potential workload reductions, the Navy has
implemented some mitigation measures that will help offset the
decreased workload in the near term and is exploring other options.
For example, according to Navy officials, the Navy has made changes to
the scope of maintenance work for cruisers and destroyers homeported
at Mayport to allocate more work to the private sector. Additionally,
the Navy has reallocated some of the maintenance work slated to be
performed by sailors at Mayport to the private sector. The Navy also
has transferred the maintenance work for three living barges--which
are used as living quarters by ship personnel while they are
conducting maintenance--from Norfolk Naval Shipyard to Mayport.
According to the Navy, these measures will not fully offset the
workload lost from the decommissioning of the frigates, but will
provide some workload stability through 2016. Additionally, the Navy
is considering other near-term options, such as the foreign military
sale of the 12 frigates scheduled to be decommissioned at Mayport
between 2011 and 2015. Navy officials told us that the sale of
frigates through the Foreign Military Sales program could add a
significant level of workload for the private ship repair firms when
the ships are refurbished and outfitted to the foreign government's
specifications. The private sector workload could remain relatively
constant through fiscal year 2016 if all the frigate refurbishments
occur in northeast Florida, according to the Navy.
Although the foreign military sale of the frigates would help address
the decreased workload through fiscal year 2016, there is still
uncertainty about the workload after 2016. As a result, the Navy is
also considering longer-term solutions, such as homeporting some of
the littoral combat ships at Mayport. Currently, no specific ships
have been identified and no timeline for delivery has been determined,
but the Navy is considering homeporting some of the ships at Mayport
beginning in fiscal year 2016. Although the maintenance workload
associated with these ships is still under development, the Navy has
stated that it would need to homeport 12 littoral combat ships to
fully mitigate the workload lost from the frigates. Additionally, the
homeporting of a carrier at Mayport in 2019 would further address the
decreased workload, as the Navy estimates that the homeporting would
increase the workload at Mayport by an average of 28,800 work days per
year.
Northeast Florida Area Includes Three Master Ship Repair Firms with
Demonstrated Capabilities and Capacity to Provide Carrier Maintenance:
The northeast Florida area is home to three master repair firms
certified by the Navy to have the capabilities and capacities to
support the maintenance requirements of U.S. Navy surface ships,
including aircraft carriers. The Navy grants the master ship repair
certification following an evaluation of a ship repair firm's
capability and capacity to perform all aspects of shipboard work and
is the highest level of certification by the Navy to perform ship
repair work. To obtain this level of certification, the firm must meet
certain criteria, including:
* have the management, organization, production, and facilities
capabilities to perform an entire complex repair and alteration
package on a frigate guided-missile class selected restricted
availability[Footnote 16] or larger ship;
* perform 55 percent of the availability using the firm's own
facilities and its own workforce; and:
* possess or have committed access to a pier with the requisite
support and technical services available to accommodate a guided-
missile class frigate.[Footnote 17]
BAE Systems Southeast Shipyards Jacksonville, Earl Industries, and
North Florida Shipyards, Inc., have this certification in the
northeast Florida area. This is comparable to the number of certified
master ship repair firms located in the Puget Sound, Washington and
San Diego, California areas, where nuclear aircraft carriers are also
homeported. Figure 2 shows the locations of firms the Navy identified
as certified master ship repair firms at Navy home ports in Puget
Sound, Washington; San Diego, California; Norfolk, Virginia; and
Mayport, Florida.
Figure 2: Master Ship Repair Firms at Selected Navy Home Ports:
[Refer to PDF for image: illustrated U.S. map]
Puget Sound:
* Todd Pacific Shipyards;
* Cascade General, Inc.
* Pacific Ship Repair and Fabrication, Inc.
Norfolk:
* Northrop Grumman Shipbuilding, Newport News;
* Metro Machine;
* Colanna's Shipyard, Inc.
* Tecnico Corporation;
* BAE Systems, Norfolk Ship Repair;
* Earl Industries;
* MHI Ship Repair and Services.
Mayport:
* BAE Systems, Southeast Shipyards Jacksonville;
* Earl Industries;
* North Florida Shipyards, Inc.
San Diego:
* NASSCO/General Dynamics Corporation;
* BAE Systems, San Diego Ship Repair;
* Northrop Grumman Continental Maritime;
* Pacific Ship Repair and Fabrication, Inc.
Source: Navy.
[End of figure]
All three of the master ship repair firms have significant production
and administrative facilities either on or near Naval Station Mayport.
[Footnote 18] In addition, officials from these firms told us that
their firms have sufficient facility resources and personnel
capabilities to support a nuclear aircraft carrier and that their
firms have options by which they can adjust to decreases in workload
or increase capacity during workload surges. For example, both BAE
Systems and Earl Industries have personnel at other locations that
could be brought to Mayport to support increased workload or Mayport
personnel could be transferred to these other locations if there is a
decrease in the workload at Mayport. In addition, these firms can use
overtime to help meet maintenance requirements during workload peaks
and can hire additional employees or issue contracts for temporary
labor to meet maintenance surges. For example, private ship repair
officials told us that there is a robust temporary ship repair
workforce that can be used by all private ship repair firms to
supplement their full-time workforce when needed. Because of these
options, private ship repair officials told us that although they are
concerned over the projected decrease in workload, workload
fluctuations are common in the ship repair industry and their firms
would be able to withstand any lulls in workload and that any workload
fluctuations would not impact their ability to support a carrier if
one is homeported at Mayport. Enclosure II includes further discussion
of the capabilities and capacity of each of the three-master ship
repair firms in northeast Florida.
Work Performed by Private Ship Repair Firms to Support a Nuclear-
Powered Aircraft Carrier Is the Same as That Performed on Other Types
of Ships:
The ship repair tasks required of the northeast Florida private ship
repair firms to support a nuclear-powered aircraft carrier are the
same as those tasks performed on conventional carriers in the past and
other types of ships. For example, the work performed by northeast
Florida ship repair firms on nonnuclear surface ships would be
consistent with similar hull, structural, preservation, and other
nonpropulsion work that would be performed on a nuclear aircraft
carrier. Thus, the type of work that the private sector is performing
now on the cruisers, destroyers, and frigates currently stationed at
Mayport will be the same type of work they would perform on a nuclear-
powered carrier if one were homeported there. Specifically, the depot-
level maintenance work conducted on nuclear-powered carriers is
separated between propulsion plant and nonpropulsion plant work.
Propulsion plant work includes maintenance activities related to the
carrier's nuclear reactors and related systems and is almost entirely
performed by the public shipyard personnel. The private sector
performs a majority of the nonpropulsion plant work which includes
such tasks as tank cleaning and repairs, preservation and painting of
the hull, flight deck gear maintenance and repair, and steel
structural repairs--basic tasks the private sector performs regardless
of the type of ship.
Private Ship Repair Firms in Northeast Florida Have Supported Aircraft
Carriers in the Past:
The various ship repair firms in northeast Florida have demonstrated
the ability to support the maintenance requirements of multiple types
of ships in the past, including performing all of the workload on
conventional aircraft carrier availabilities. Until 2007, Naval
Station Mayport was the home port to at least one conventional
aircraft carrier and multiple types of other surface ships. Private
ship repair officials told us that during this time their firms were
able to provide all the necessary maintenance capabilities and
capacity to support these ships. In fact, according to the Navy, the
largest aircraft carrier availability ever performed outside of a
public shipyard was completed on the USS John F. Kennedy in Mayport in
2003 and included more than 360,000 work days completed by the private
sector. According to our analysis, this is about five times the amount
of work that will be completed by private ship repair firms on a
nuclear carrier at Mayport during a planned incremental availability.
According to the Navy's 2010 Mayport ship maintenance industrial base
report, the Navy estimates that if a nuclear carrier is homeported at
Mayport, private ship repair firms will be required to complete an
average of approximately 28,800 work days of ship repair work per
year. This is considerably less than the average annual work days
performed by the private sector on the USS John F. Kennedy during
fiscal years 1998 through 2007, when the private sector performed
almost all of the conventional carrier repair work, as shown by table
2.
Table 2: Historical Workload on USS John F. Kennedy, Fiscal Years 1998-
2007:
Fiscal year: 1998;
Total work days: 69,226.
Fiscal year: 1999;
Total work days: 53,077.
Fiscal year: 2000;
Total work days: 94,759.
Fiscal year: 2001;
Total work days: 30,762.
Fiscal year: 2002;
Total work days: 30,077.
Fiscal year: 2003;
Total work days: 366,083.
Fiscal year: 2004;
Total work days: 21,290.
Fiscal year: 2005;
Total work days: 11,607.
Fiscal year: 2006;
Total work days: 2,442.
Fiscal year: 2007;
Total work days: 28,164.
Average work days per year: 70,749.
Source: Navy.
Notes: The large decrease in total work days starting in 2005
represents the fact that the Navy started to defer maintenance on the
USS John F. Kennedy as it was slated to be decommissioned. The work
days for 2007 represents work days performed through May 31, 2007.
[End of table]
Navy Designed Its Contracting Strategy to Help Firms Plan for and
Conduct Ship Repair Work:
According to Navy officials, the Navy designed its contracting
strategy for nuclear aircraft carrier maintenance to help private ship
repair firms plan for decreases and increases in workload. Navy
officials stated that at each home port, the Navy awards a multiyear,
multiship, multioption contract to a prime contractor to perform the
maintenance on all the ships of a particular class. For example,
according to the Navy, Earl Industries is currently responsible for
performing with its own workforce and subcontracting with other firms
the private-sector maintenance for all the carriers in Norfolk,
Virginia. The Navy asserts that this type of contracting strategy:
* establishes a long-term relationship between the Navy and prime
contractor;
* provides the prime contractor early visibility into the Navy's
carrier maintenance planning, thus allowing the contractor to
appropriately size its workforce in anticipation of future workload;
* facilitates the scheduling of work, resulting in contractor
efficiencies and cost savings;
* reduces the time spent on contracting private sector work;
* provides a quick response to emergent work; and:
* provides an easy contracting vehicle for ship repair firms to
perform deferred maintenance every time ships are in home port,
regardless of the duration of their visit.
Moreover, according to Navy officials, within its multiyear,
multiship, multioption contracts, the Navy promotes partnerships
between the prime contractor and other ship repair firms actually
performing the scheduled maintenance work through teaming agreements.
According to industry representatives, teaming agreements are used by
the prime contractor to share work with other ship repair firms in
northeast Florida. Generally, teaming agreements include arrangements
in which a potential prime contractor agrees with other companies to
have them act as its subcontractors under a specified government
contract. In addition, private ship repair officials told us the
teaming agreement allows the prime contractor to easily draw upon the
resources of subcontractors during increased workload periods and
spreads the workload around to different firms to help maintain the
capabilities of the all the ship repair firms. According to the Navy,
this contracting strategy is currently used for private sector repairs
on all nuclear aircraft carriers, and the Navy has indicated it plans
to implement this strategy for the proposed carrier homeporting at
Mayport, including the use of teaming agreements.
The Navy's Report Generally Addressed the Provisions Directed in the
House Report, but Additional Information Could Help to Clarify Its
Responses:
The Navy's December 2010 report on the northeast Florida private ship
maintenance industrial base[Footnote 19] generally met the reporting
direction, including the three provisions outlined in House Report 111-
491, which accompanied a proposed bill for the Fiscal Year 2011
National Defense Authorization Act (H.R. 5136). The Navy, however,
could have provided clearer and more complete responses in its report
by including additional information that could help provide Congress
with a better understanding of its conclusions regarding the
sufficiency of the capabilities and capacities of ship repair firms
near or around Naval Station Mayport to support the maintenance
requirements of a nuclear-powered aircraft carrier. Table 3 provides
our evaluation of the Navy's responses to the three provisions listed
in the House report as provided in its December 2010 report.
Table 3: Our Evaluation of the Navy's December 2010 Report Responses
to the Congressional Defense Committees on the Northeast Florida
Private Ship Maintenance Industrial Base:
House Report 111-491 provision: The ability of the private ship
maintenance industrial base in northeast Florida to support nuclear-
powered aircraft carrier maintenance requirements;
Navy's response and information that would help clarify the response:
* The Navy's report discussed the capabilities of the various private
ship repair firms in northeast Florida and listed some of the types of
work that the firms can perform;
* We found the report did not fully provide information on the:
- maintenance requirements of a nuclear-powered aircraft carrier and
how that maintenance work would be allocated to the private sector;
- impact of the decreasing Navy ship workload on the private ship
repair firms and whether this decrease would affect their ability to
meet the maintenance requirements of a nuclear aircraft carrier;
* Including such information on the carrier's maintenance requirements
and the impact of the decreasing workload would have provided
additional support for the Navy's conclusion regarding the sufficiency
of the various northeast Florida firms to support a nuclear aircraft
carrier.
House Report 111-491 provision: The likely costs to the Navy that
could result from establishing such maintenance capabilities within
the local industrial base;
Navy's response and information that would help clarify the response:
* The Navy's report concluded that there would not be any additional
costs to the Navy associated with adding maintenance capabilities
within the private-sector ship repair industrial base to support a
nuclear aircraft carrier as the various firms already have the
required capabilities;
* We found the Navy did not fully explain how it reached its
conclusion. Specifically, the report did not explain the differences
between propulsion plant and related systems and nonpropulsion plant
maintenance work, and the Navy's use of public shipyard employees to
accomplish the propulsion plant maintenance and private ship repair
firms to accomplish nonpropulsion requirements, or the capabilities
needed to accomplish those tasks;
* Including the differences between propulsion plant and nonpropulsion
plant maintenance and the Navy's strategy to accomplish this work
would have further explained the Navy's conclusion that the private
ship repair firms already have the capabilities to support the
nonpropulsion maintenance requirements of a nuclear aircraft carrier
and that there would not be any need for additional capabilities
within the local industrial base.
House Report 111-491 provision: The impacts on costs and workforce
scheduling that could result if the Navy must provide the maintenance
workforce from another nuclear-powered aircraft carrier home-port
location;
Navy's response and information that would help clarify the response:
* The Navy's report discussed the maintenance workload associated with
a nuclear aircraft carrier and the potential cost to the Navy if the
public shipyards needed to perform 10 percent more of the work than
anticipated, which would require these shipyards to send more workers
to Mayport;
* We found the report did not fully discuss the Navy's workforce-
shaping procedures and the One Shipyard concept, which helps ensure
that the required number of workers and skill sets are available when
needed to meet current and planned maintenance requirements. Under the
Naval Sea Systems Command's One Shipyard concept, the naval shipyards
adjust the overall ship repair workload and mobilize the workforce
across the all naval and private shipyards as needed to meet the
Navy's maintenance needs for its ships and help stabilize the workload;
* This information would have provided the reader with better context
to understand the Navy's potential workforce-scheduling strategies and
any impacts that could result if the Navy must provide the maintenance
workforce from another home-port location than Mayport.
Source: GAO analysis.
[End of table]
While the responses in the northeast Florida industrial base report
could be clearer and more complete, the additional information lacking
in the report is available in two other recent Navy reports previously
issued to Congress or the congressional defense committees--one on the
assessment of the U.S. ship repair industrial base[Footnote 20], and
the other on homeporting alternatives for Mayport.[Footnote 21]
Additionally, this report and other reports we have recently issued on
the Mayport carrier homeporting proposal also provide complementary
information on nuclear carrier maintenance, homeporting costs, and
other related areas not fully addressed in the Navy's report.[Footnote
22] First, a 2007 Navy report to Congress on the assessment of the
U.S. ship repair industrial base provides a discussion of the
maintenance requirements of a nuclear-powered aircraft carrier and how
that work is distributed to the private sector. Second, a 2010 Navy
report to the congressional defense committees on homeporting
alternatives for Mayport, issued at the same time as the northeast
Florida private ship maintenance industrial base report , discusses
the possible impacts of the expected decreasing workload at Naval
Station Mayport on the northeast Florida private ship repair firms.
Third, we provide a discussion of the differences between propulsion
plant and related systems and nonpropulsion plant maintenance work and
the related workforces in this report, as well as a recent report we
issued on the nuclear carrier workforce plans for the Mayport carrier.
[Footnote 23] And lastly, the Navy's 2007 report and its current
shipyard business plan that was provided to members of Congress in May
2010[Footnote 24] provide information on the Navy's workforce-shaping
procedures and the One Shipyard concept.
We are not making any recommendations in this correspondence. After
reviewing a draft of this product, DOD officials said that the
department had no comments.
We are sending copies of this correspondence to the congressional
defense committees. We are also sending copies to the Secretary of
Defense; Secretary of the Navy; and Director, Office of Management and
Budget. This correspondence will also be available at no charge on our
Web site at [hyperlink, http://www.gao.gov].
Should you or your staffs have any questions concerning this
correspondence, please contact me at (202) 512-4523 or
leporeb@gao.gov. Contact points for our Offices of Congressional
Relations and Public Affairs may be found on the last page of this
correspondence. Key contributors to this correspondence are listed in
enclosure III.
Signed by:
Brian J. Lepore:
Director, Defense Capabilities and Management:
Enclosures - 3:
[End of section]
List of Committees:
The Honorable Carl Levin:
Chairman:
The Honorable John McCain:
Ranking Member:
Committee on Armed Services:
United States Senate:
The Honorable Daniel K. Inouye:
Chairman:
The Honorable Thad Cochran:
Ranking Member:
Subcommittee on Defense:
Committee on Appropriations:
United States Senate:
The Honorable Howard P. McKeon:
Chairman:
The Honorable Adam Smith:
Ranking Member:
Committee on Armed Services:
House of Representatives:
The Honorable C.W. Bill Young:
Chairman:
The Honorable Norman D. Dicks:
Ranking Member:
Subcommittee on Defense:
Committee on Appropriations:
House of Representatives:
[End of section]
Enclosure I: Summary of GAO's Independent Cost Estimate to Homeport a
Nuclear Carrier at Naval Station Mayport:
Our independent cost estimate of establishing a nuclear-powered
aircraft carrier home port at Mayport suggests that over a 10-year
budget window, recurring costs are expected to total between $90
million and $176 million ($9.0 million and $17.6 million per year), in
base year 2010 dollars. For nonrecurring or one-time costs, our
independent estimate suggests that the total one-time cost of
homeporting a nuclear-powered aircraft carrier at Naval Station
Mayport is expected to be between $258.7 million and $356.0 million,
in base year 2010 dollars. Table 4 shows our estimated range for
recurring costs for each cost element in our independent estimate.
Specifically, the table shows our estimate range at an 80 percent
confidence interval. The low value of the estimated range represents a
10 percent chance that the cost will be that amount or less, and the
high value of the estimated range represents a 90 percent chance that
the cost will be that amount or less.
Table 4: GAO Estimated Range of Recurring Costs (in Base-Year 2010
Dollars):
Cost element: Permanently assigned labor for nuclear facilities;
GAO's estimated low cost: $0.7 million;
GAO's estimated high cost: $1.9 million.
Cost element: Base operating support;
GAO's estimated low cost: $0.7 million;
GAO's estimated high cost: $1.4 million.
Cost element: Facilities sustainment;
GAO's estimated low cost: $0.7 million;
GAO's estimated high cost: $1.2 million.
Cost element: Facilities restoration and modernization;
GAO's estimated low cost: $2.2 million;
GAO's estimated high cost: $3.3 million.
Cost element: Operations;
GAO's estimated low cost: $0.5 million;
GAO's estimated high cost: $1.4 million.
Cost element: Travel/per diem for public shipyard workers;
GAO's estimated low cost: $4.8 million;
GAO's estimated high cost: $12.2 million.
Cost element: Biennial maintenance dredging;
GAO's estimated low cost: $0.1 million;
GAO's estimated high cost: $0.2 million.
Cost element: Basic allowance for housing differential;
GAO's estimated low cost: -$5.5 million;
GAO's estimated high cost: -$4.4 million.
Cost element: Utilities;
GAO's estimated low cost: $0.6 million;
GAO's estimated high cost: $1.8 million.
Cost element: Permanent change of station;
GAO's estimated low cost: $1.0 million;
GAO's estimated high cost: $1.3 million.
Cost element: Private sector travel;
GAO's estimated low cost: $0.1 million;
GAO's estimated high cost: $1.2 million.
Source: GAO analysis.
Notes: Base-year 2010 dollars have the effects of inflation removed.
The low cost estimate is at the 10 percent confidence level and the
high cost estimate is at the 90 percent confidence level. It is not
statistically appropriate to add each of the individual confidence
intervals to come up with an overall confidence interval. The range
and estimate for the basic allowance for housing is negative because
the housing allowance is less in the Jacksonville, Florida,
metropolitan area than it is in Norfolk, Virginia. This means that the
Navy saves money for this cost element.
[End of table]
Table 5 shows a comparison between our estimated range for each cost
element in our independent estimate for one-time costs. Specifically,
the table shows our estimated range at an 80 percent confidence
interval. The low value of the estimate range represents a 10 percent
chance that the cost will be that amount or less, and the high value
of the estimated range represents a 90 percent chance that the cost
will be that amount or less. For more information, see our recently
issued report that provides our independent estimate of the full life-
cycle costs associated with the Navy's planned homeporting of a
nuclear-powered aircraft carrier at Mayport.[Footnote 25]
Table 5: GAO Estimated Range of One-Time Costs (in Base Year 2010
dollars):
Cost element: Planning and design;
GAO's estimated low cost: $15.0 million;
GAO's estimated high cost: $22.9 million.
Cost element: Dredging;
GAO's estimated low cost: $31.3 million;
GAO's estimated high cost: $33.1 million.
Cost element: Construction: Parking garage;
GAO's estimated low cost: $21.9 million;
GAO's estimated high cost: $53.3 million.
Cost element: Construction: Road improvements;
GAO's estimated low cost: $9.5 million;
GAO's estimated high cost: $24.3 million.
Cost element: Construction: Wharf F improvements;
GAO's estimated low cost: $28.3 million;
GAO's estimated high cost: $75.3 million.
Cost element: Construction: Controlled industrial facility;
GAO's estimated low cost: $35.2 million;
GAO's estimated high cost: $94.9 million.
Cost element: Construction: Ship maintenance support facilities;
GAO's estimated low cost: $23.0 million;
GAO's estimated high cost: $59.3 million.
Cost element: Initial equipment outfitting;
GAO's estimated low cost: $24.5 million;
GAO's estimated high cost: $64.4 million.
Cost element: Permanent change of station for crew;
GAO's estimated low cost: $4.7 million;
GAO's estimated high cost: $6.0 million.
Source: GAO Analysis.
Notes: The low cost estimate is at the 10 percent confidence level and
the high cost estimate is at the 90 percent confidence level. It is
not statistically appropriate to add each of the individual confidence
intervals to come up with an overall confidence interval. In addition
to the road improvements on Naval Station Mayport, information
provided by a Department of Transportation official indicates that the
Jacksonville Transportation Authority, based on its study of traffic
improvements to the intersection approaching the main gate outside of
the naval station, has identified up to $8 million in improvements
that are unfunded at this time. The official indicated that these
improvements are potentially eligible for federal-aid funds.
[End of table]
[End of section]
Enclosure II: Capabilities and Capacity of the Master Ship Repair
Firms in Northeast Florida:
The northeast Florida area has three master ship repair firms--BAE
Systems Southeast Shipyards Jacksonville, Earl Industries, and North
Florida Shipyards, Inc.--certified by the Navy as having the
capabilities and capacity required to perform nonnuclear maintenance
and modernization on all Navy ships. The following is a description of
the capabilities and capacity of these master ship repair firms.
BAE Systems Southeast Shipyards Jacksonville:
BAE Systems is the largest of the three master ship repair firms in
northeast Florida. It has modern ship repair facilities located
adjacent to Wharf F (where the proposed nuclear aircraft carrier will
be docked during an availability) at Naval Station Mayport. These
facilities are fully dedicated to supporting Navy vessels. BAE Systems
also maintains an administrative facility at Naval Station Mayport to
execute support functions such as solicitation, execution planning,
and program management. The facilities at Naval Station Mayport
include the following trade shops:
* pipe shop,
* welding shop,
* electric shop,
* rigging shop,
* paint shop,
* pump shop,
* sheet metal shop,
* insulation and lagging shop, and:
* warehouse.
In addition to the facilities located at Naval Station Mayport, BAE
Systems also has substantial capabilities at its private Jacksonville
shipyard. The Jacksonville shipyard is just across the St. John's
River from Naval Station Mayport, less than 5 miles by car. The
facility performs both Navy and commercial work. Three Naval Sea
Systems Command certified dry docks are located at this facility,
including a 4,000-ton marine railway and a 13,500-ton dry dock capable
of docking cruiser and destroyer class ships. The Jacksonville
shipyard facilities and equipment are available to Naval Station
Mayport if needed. BAE Systems employs approximately 800 full-time
ship repair personnel at its Naval Station Mayport and Jacksonville
repair facilities combined. Additionally, it employs approximately
1,300 full-time personnel in the Norfolk area who could potentially be
used to augment its personnel in northeast Florida, if needed.
Earl Industries:
Earl Industries' facilities at Naval Station Mayport were designed
specifically to support Navy ship repair. The 2-acre compound occupied
by Earl Industries, adjacent to Wharf F, includes a fully equipped
machine shop, structural shop, electrical clean room, sheet metal
shop, and pipe shop. Additionally, a fully equipped 30,000-square foot
production building constructed in fiscal year 2007 is located 500
yards from the piers. According to Earl Industries' executives, this
facility was designed to support aircraft carrier maintenance
requirements; however, according to Earl officials, since the
decommissioning of the USS John F. Kennedy in 2007, the building has
not been utilized to its full capabilities. Earl Industries also
maintains mobile, containerized tool rooms and shop facilities that
are readily transportable to the wharf job site. Earl Industries also
has a long-term lease on a 10,000-square foot warehouse and 2 more
acres of temporary storage area a half of a mile outside the Naval
Station's main gate. Earl Industries employs approximately 120 full-
time ship repair personnel at its Naval Station Mayport location. In
addition, it employs approximately 571 personnel in the Norfolk area,
who could potentially be used to augment its personnel in northeast
Florida, if needed.
North Florida Shipyards, Inc.
North Florida Shipyards has a 60,000-square foot facility located on
2.5 acres adjacent to Wharf F on Naval Station Mayport. This facility
houses a fabrication shop, pipe shop, machine shop, electric shop,
crane and rigging shop, paint shop, and material storage warehouse. In
addition to the Mayport facility, North Florida Shipyards also has a
commercial facility located at Commodore Point in Jacksonville,
Florida. This facility has additional capabilities and equipment that
are available to support Navy work being performed at Naval Station
Mayport if needed. North Florida Shipyards employs approximately 235
full-time ship repair personnel at its Naval Station Mayport and
Jacksonville locations combined. It does not have any personnel in the
Norfolk area.
[End of section]
Enclosure III: GAO Contact and Staff Acknowledgments:
GAO Contact:
Brian J. Lepore, (202) 512-4523 or leporeb@gao.gov:
Staff Acknowledgments:
In addition to the contact named above, Mark J. Wielgoszynski,
Assistant Director; Darnita Akers; Shawn Arbogast; Russell Bryan; Mary
Jo LaCasse; Carol Petersen; Erik Wilkins-McKee; and Michael
Shaughnessy made key contributions to this report.
[End of section]
Footnotes:
[1] Naval Station Mayport is located in northeast Florida, on the
Atlantic Coast, near Jacksonville. It is roughly 469 nautical miles
south-southwest of Norfolk.
[2] In our report examining the military services' processes for
making basing decisions for force structure within the United States,
we provide information about the approach used by the Navy in making
its decision to homeport a nuclear-powered carrier at Mayport,
Florida. See GAO, Defense Infrastructure: Opportunities Exist to
Improve the Navy's Basing Decision Process and DOD Oversight,
[hyperlink, http://www.gao.gov/products/GAO-10-482] (Washington, D.C.:
May 11, 2010).
[3] For the purpose of this report we define the ship maintenance
industrial base as the private ship repair firms, including the
smaller firms and temporary labor with which they work, that support
Navy ship repair, maintenance, and modernization requirements in
northeast Florida. As such, throughout this report we use private ship
repair firms when referring to the private ship maintenance industrial
base, except when specifically referring to language in the committee
report.
[4] See H.R. Rep. No. 111-491, at 260-261 (2010).
[5] Department of the Navy, Report to Congress on Northeast Florida
Private Ship Maintenance Industrial Base (Washington, D.C.: Dec. 29,
2010).
[6] GAO, Defense Infrastructure: Navy Can Improve the Quality of Its
Cost Estimate to Homeport an Aircraft Carrier at Naval Station
Mayport, [hyperlink, http://www.gao.gov/products/GAO-11-309]
(Washington, D.C.: Mar. 3, 2011). GAO-11-309 was developed in response
to direction from the committee to submit a report containing an
independent estimate of the total direct and indirect costs to be
incurred by the federal government in homeporting a nuclear carrier at
Mayport. See H.R. Rep. No. 111-491, at 507.
[7] Although the Navy uses the industrial term manday when referring
to aircraft carrier maintenance, for purposes of this report we use
the term work day. Both refer to the industrial unit of production
equal to the work one person can produce in a day.
[8] Office of the Chief of Naval Operations Instruction 4700.7L,
Maintenance Policy for United States Navy Ships (May 25, 2010); Office
of the Chief of Naval Operations Notice 4700, Representative
Intervals, Durations, and Repair Mandays for Depot Level Maintenance
Availabilities of U.S. Navy Ships (Nov. 8, 2010); Naval Sea Systems
Command, CVN 68 Class Aircraft Carrier Class Maintenance Plan
(Revision 3, Dec. 2009).
[9] The Navy's four public shipyards--Norfolk Naval Shipyard in
Virginia, Pearl Harbor Naval Shipyard in Hawaii, Portsmouth Naval
Shipyard in Maine, and Puget Sound Naval Shipyard in Washington--
provide the organic capability to perform ship repair maintenance and
modernization, and complement the private sector's capability for
conventional surface ship maintenance.
[10] House Report 111-491 directed GAO to assess the potential
readiness and cost impacts to the nuclear propulsion depot maintenance
workforce. See H.R. Rep. No. 111-491, at 254. Our report on this
subject was issued to congressional defense committees on March 3,
2011 [hyperlink, http://www.gao.gov/products/GAO-11-275R].
[11] The littoral combat ship is a new class of warship meant to
facilitate U.S. Navy access to and operations in the littorals, which
are waters close to shore. The Navy plans to build a total of 55
littoral combat ships.
[12] Under the Naval Sea Systems Command's One Shipyard concept, the
naval shipyards adjust the overall ship repair workload and mobilize
the workforce across the all naval and private shipyards as needed to
meet the Navy's maintenance needs for its ships and help stabilize the
workload.
[13] Office of the Chief of Naval Operations, Assessment of Ship
Repair Industrial Base (Washington, D.C.: June 2007). This report
provided information on private ship repair firms geographically
located in port areas throughout the continental United States, in
Hawaii, and in Guam that are certified capable to perform work on U.S.
Navy ships.
[14] Department of the Navy, Report to Congress on Naval Station
Mayport, Florida, Homeporting Alternatives (Washington, D.C.: Dec. 28,
2010).
[15] Office of the Chief of Naval Operations Instruction 4700.7L,
Maintenance Policy for United States Navy Ships.
[16] Selected restricted availabilities are short labor-intensive
maintenance availabilities, assigned to ships in certain maintenance
programs with characteristics such as reduced manning, limited
organizational-level maintenance, and operational tempos that limit
ship's availability for regular depot-level maintenance periods,
designed to sustain a high level of readiness and increase the ship's
availability for required operations.
[17] See Naval Sea Systems Command Instruction 4280.2C, Master
Agreement for Repair and Alteration of Vessels; Master Ship Repair
Agreement (MSRA) and Agreement for Boat Repair (ABR) (Nov. 27, 1996).
See also Department of the Navy, Report to Congress on Northeast
Florida Private Ship Maintenance Industrial Base (Washington, D.C.:
Dec. 29, 2010).
[18] Enclosure II includes further discussion of the capabilities and
capacity of each of the master ship repair firms in northeast Florida.
[19] For the purpose of this report we define the ship maintenance
industrial base as the private ship repair firms, including the
smaller firms and temporary labor with which they work, that support
Navy ship repair, maintenance, and modernization requirements in
northeast Florida. As such, throughout this report we use private ship
repair firms when referring to the private ship maintenance industrial
base, except when specifically referring to language in the committee
report.
[20] Office of the Chief of Naval Operations, Assessment of Ship
Repair Industrial Base. This report provided information on private
ship repair firms geographically located in port areas throughout the
continental United States, in Hawaii, and in Guam that are certified
capable to perform work on U.S. Navy ships
[21] Department of the Navy, Report to Congress on Naval Station
Mayport, Florida, Homeporting Alternatives.
[22] GAO, Depot Maintenance: Navy Has Revised Its Estimated Workforce
Cost for Basing an Aircraft Carrier at Mayport, Florida, [hyperlink,
http://www.gao.gov/products/GAO-11-257R] (Washington, D.C.: Mar. 3,
2011); [hyperlink, http://www.gao.gov/products/GAO-11-309]; and
[hyperlink, http://www.gao.gov/products/GAO-10-482].
[23] [hyperlink, http://www.gao.gov/products/GAO-11-257R].
[24] Department of the Navy, 2010 Naval Shipyard Business Plan
(Washington, D.C.: May 10, 2010).
[25] GAO, Defense Infrastructure: Navy Can Improve the Quality of Its
Cost Estimate to Homeport an Aircraft Carrier at Naval Station
Mayport, [hyperlink, http://www.gao.gov/products/GAO-11-309]
(Washington, D.C.: Mar. 3, 2011).
[End of section]
GAO's Mission:
The Government Accountability Office, the audit, evaluation and
investigative arm of Congress, exists to support Congress in meeting
its constitutional responsibilities and to help improve the performance
and accountability of the federal government for the American people.
GAO examines the use of public funds; evaluates federal programs and
policies; and provides analyses, recommendations, and other assistance
to help Congress make informed oversight, policy, and funding
decisions. GAO's commitment to good government is reflected in its core
values of accountability, integrity, and reliability.
Obtaining Copies of GAO Reports and Testimony:
The fastest and easiest way to obtain copies of GAO documents at no
cost is through GAO's Web site [hyperlink, http://www.gao.gov]. Each
weekday, GAO posts newly released reports, testimony, and
correspondence on its Web site. To have GAO e-mail you a list of newly
posted products every afternoon, go to [hyperlink, http://www.gao.gov]
and select "E-mail Updates."
Order by Phone:
The price of each GAO publication reflects GAO‘s actual cost of
production and distribution and depends on the number of pages in the
publication and whether the publication is printed in color or black and
white. Pricing and ordering information is posted on GAO‘s Web site,
[hyperlink, http://www.gao.gov/ordering.htm].
Place orders by calling (202) 512-6000, toll free (866) 801-7077, or
TDD (202) 512-2537.
Orders may be paid for using American Express, Discover Card,
MasterCard, Visa, check, or money order. Call for additional
information.
To Report Fraud, Waste, and Abuse in Federal Programs:
Contact:
Web site: [hyperlink, http://www.gao.gov/fraudnet/fraudnet.htm]:
E-mail: fraudnet@gao.gov:
Automated answering system: (800) 424-5454 or (202) 512-7470:
Congressional Relations:
Ralph Dawn, Managing Director, dawnr@gao.gov:
(202) 512-4400:
U.S. Government Accountability Office:
441 G Street NW, Room 7125:
Washington, D.C. 20548:
Public Affairs:
Chuck Young, Managing Director, youngc1@gao.gov:
(202) 512-4800:
U.S. Government Accountability Office:
441 G Street NW, Room 7149:
Washington, D.C. 20548:
