The Status of a Gas Generator Engine for the Coast Guard Cutter Boutwell

Pursuant to a congressional request, GAO reviewed the status of a rebuilt gas generator engine that the Coast Guard purchased for one of its cutters, including the applicability of the warranty, and changes the Coast Guard has made to ensure that it does not experience a recurrence of the problem it had with that engine.

GAO found that the Coast Guard policy for replacement engines was to issue a repaired/rebuilt engine from its inventory. However, since it determined that it did not have a rebuilt engine in its inventory or sufficient time to have the cutter's engine repaired, the Coast Guard awarded a contract for the purchase of a replacement engine. Although the engine met Coast Guard specifications, it contained parts that had previously been used in an aircraft engine which the original manufacturer recommended not be used in marine engines because of possible failure that could cause damage to the ship and injury to the crew; therefore, the Coast Guard decided not to use the engine and shipped the engine to a training center, where the expensive parts were removed and stored for use in repairing other engines. The Coast Guard General Counsel found that there was no legal basis to require the contractor to replace the defective parts, since the warranty covered engine failures, and the engine had never been used. The Coast Guard has revised its specifications for the repair and overhaul of gas generator engines and has a goal to have a sufficient number of rebuilt engines on hand to preclude the need to purchase engines. It also holds the contractor responsible for the replacement of any part which does not meet the specifications and, if the contractor refuses to replace the part, the Coast Guard can have the part replaced and can bill the original contractor for the cost of replacement.