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Rl 32418

Rl 32418

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Published by samlagrone
Rl 32418
Rl 32418

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Published by: samlagrone on Oct 16, 2013
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06/17/2014

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CRS Report for Congress
 Prepared for Members and Committees of Congress
Navy Virginia (SSN-774) Class AttackSubmarine Procurement: Background andIssues for Congress
Ronald O'Rourke
Specialist in Naval AffairsSeptember 27, 2013
Congressional Research Service
7-5700www.crs.govRL32418
 
Navy Virginia (SSN-774) Class Attack Submarine Procurement Congressional Research Service
Summary
The Navy has been procuring Virginia (SSN-774) class nuclear-powered attack submarines sinceFY1998. The two Virginia-class boats requested for FY2014 are to be the 19
th
and 20
th
boats inthe class, and the first two in a 10-boat Virginia class multiyear-procurement (MYP) contract for the period FY2014-FY2018. Congress granted authority for this MYP contract as part of itsaction on the FY2013 Department of Defense (DOD) budget. The Navy’s FY2013 budgetsubmission had projected one Virginia-class boat in FY2014. Congress, as part of its action on theFY2013 DOD budget, added AP funding in FY2013 to support the procurement of a secondVirginia-class boat in FY2014. The Navy’s inclusion of a second Virginia-class boat in FY2014(which increases from 9 to 10 the number of boats in the FY2014-FY2018 MYP contract) followsthrough on this congressional action.The Navy’s proposed FY2014 budget estimates the combined procurement cost of the two boatsrequested for FY2014 at $5,414.2 million. The two boats have received a total of $1,530.8 millionin prior-year advance procurement (AP) funding (although this figure may be reduced by theMarch 1, 2013, sequester), leaving another $3,883.4 million to complete the funding for the two boats.The Navy’s proposed FY2014 budget requests $5,285.3 million in procurement and AP fundingfor the Virginia class program. This figure includes:
 
$2,930.7 million in procurement funding to complete the procurement cost of thefirst boat requested for FY2014, and to pay part of the procurement cost of thesecond boat requested for FY2014;
 
$1,612.0 million in AP funding for Virginia-class boats to be procured in futurefiscal years; and
 
$742.6 million in AP funding for Economic Order Quantity (EOQ) purchases(i.e., batch orders) of selected components of the 10 Virginia-class boats to be procured under the FY2014-FY2018 MYP contract. EOQ purchases are a regular feature of the first year or two or an MYP contract.The Navy is proposing to defer to FY2015 the remaining $952.7 million of the procurement costof the second boat requested for FY2014. This would divide the procurement funding for the boat between two fiscal years (FY2014 and FY2015)—a funding profile sometimes called splitfunding. In recent instances where split funding has been used to fund Navy ships, the fundinghas been appropriated using a funding method called incremental funding, under which Congresstakes a positive action to approve each of the two annual funding increments. For the secondVirginia-class boat requested for FY2014, however, the Navy is proposing to use a differentfunding method called advance appropriations, which is a form of full funding that resembles alegislatively locked in form of incremental funding. Under advance appropriations (which is notto be confused with advance procurement [AP] funding), the FY2015 funding increment for the boat would be legislatively locked into place (i.e., it would be “automatic”), and Congress wouldneed to take action to stop that increment from being appropriated. Although the Navy in recentyears has occasionally expressed interest in using advance appropriations for funding ships, thereis little precedent in recent years for funding Navy ships with advance appropriations.DOD and the Navy are considering whether to build Virginia-class boats procured in FY2019 andsubsequent years with an additional mid-body section, called the Virginia Payload Module
 
Navy Virginia (SSN-774) Class Attack Submarine Procurement Congressional Research Service
(VPM), that contains four large-diameter, vertical launch tubes that the boats would use to storeand fire additional Tomahawk cruise missiles or other payloads, such as large-diameter unmannedunderwater vehicles (UUVs). Building Virginia-class boats with the VPM might increase their unit procurement costs by about 15%-20%, and would increase the total number of torpedo-sizedweapons (such as Tomahawks) that they could carry by about 76%.The Navy’s FY2013 30-year SSN procurement plan, if implemented, would not be sufficient tomaintain a force of 48 SSNs consistently over the long run. The Navy projects under that planthat the SSN force would fall below 48 boats starting in FY2022, reach a minimum of 43 boats inFY2028-FY2030, and remain below 48 boats through FY2034.Potential issues for Congress regarding the Virginia-class program include the following:
 
the impact on the Virginia-class program of the March 1, 2013, sequester onFY2013 funding and unobligated prior-year funding for the program;
 
the potential impact on the Virginia-class program of a possible sequester later this year or early next year on FY2014 funding and unobligated prior-year funding for the program;
 
whether to use traditional (i.e., single-year) full funding, incremental funding, or (as the Navy proposes) advance appropriations for funding the second of the two boats requested for procurement in FY2014;
 
the Virginia-class procurement rate more generally in coming years, particularlyin the context of an SSN shortfall projected for FY2025-FY2034 and the larger debate over future U.S. defense strategy and defense spending; and
 
Virginia-class program issues raised in a December 2012 report from DOD’sDirector, Operational Test and Evaluation (DOT&E).The Navy’s Ohio Replacement (SSBN[X]) ballistic missile submarine program is discussed inCRS Report R41129,
 Navy Ohio Replacement (SSBN[X]) Ballistic Missile Submarine Program: Background and Issues for Congress
, by Ronald O'Rourke.

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