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Navy Sealift Ship Construction The Prime Near Term Opportunity For U.S. Shipyards by James R. McCaul, President, IMA Associates, Inc. Sealift ship construction continues to offer the largest near term pros- pects for U.S. shipyards, with $1.85 billion already appropriated and $1.2 billion requested in next year's de- fense budget to build or convert sealift ships. Program Status As has been widely reported, the Navy has been forced by the Depart- ment of Defense (DOD) to follow a highly formalized acquisition pro- cess for procuring additional sealift ships. Review and approval must be given by the Defense Acquisition Board (DAB) between major steps in the program. The Defense Acquisition Board's meeting for Milestone I, approving the start of the engineering phase, is scheduled to take place during the first week in September. The meet- ing, originally scheduled for the end of September, was moved up as a result of sealift being accorded greater attention by top DOD offi- cials. Anticipating DAB approval, the Navy has announced intentions to issue a solicitation for class stan- dard cargo handling equipment. The solicitation will call for the manu- facture, acquisition, management and integration of major cargo han- dling class standard equipment for installation in new and converted sealift ships. Sealift Program Management It has been difficult to coordinate the varied interests and priorities of agencies involved in sealift ship planning. Army top management sees a large, quickly acquired sealift capa- bility to be an absolute necessity. The Army must be able to demon- strate an ability to mobilize and deliver combat equipment. Other- wise, there will be increasing pres- sure within DOD, OMB and Con- gress to impose much greater cuts on active Anny forces. The Navy, however, may not have always shared the same urgency. In fact, there may be some elements in the Navy who would like to use the sealift funds for other purposes. To strengthen program manage- ment, a July 14 memo from the Deputy Secretary of Defense has designated the Acting Secretary of Navy as the DOD executive agent for sealift acquisition and accorded sealift a pilot program status (see exhibit 1). The Acting Secretary of the Navy has been a strong advocate of sealift and he is expected to shift the sealift ship program into high gear. Demonstrating his interest in improving sealift capability, the new secretary chaired a high level coor- dinating meeting on sealift just two days after assuming his new posi- tion. Sealift Ship Fund The Administration had re- quested that a special sealift ship fund be established to pay for sealift ship construction and conversion. This funding would be separate from other procurement accounts. The House Armed Services committee recently rejected the Administration's 68 Maritime Reporter/Engineering News
