Newport News Daily Press wrote:February 9, 2013
Navy Delays Lincoln Refueling, Cites 'Lack Of Funds'
Enterprise defueling and USS GW overhaul also impacted
By Michael Welles Shapiro
The Navy said Friday it is postponing Newport News Shipbuilding's long-planned refueling and complex overhaul of the aircraft carrier USS Abraham Lincoln.
Citing "a lack of funding," Lt. Courtney Hillson, a Navy spokeswoman, said in a statement that the "Lincoln will remain at Naval Station Norfolk," until money is made available for the project through one of two budgetary mechanisms.
The ship had been set to steam into dry dock in Newport News Thursday. Now with the delay, Hillson said the Lincoln will stay put while the "ship's sailors continue to conduct maintenance."
And she added that the decision will have a domino effect on other Newport News carrier maintenance projects because the shipyard now has to rearrange its dry dock schedule. Specifically, she predicted "impacts to the recently inactivated Enterprise defueling and the start of USS George Washington's RCOH."
In a letter to employees, shipyard president Matt Mulherin stressed that the RCOH was not canceled and urged shipbuilders not to let Friday's news become a distraction.
"We are very disappointed and frustrated at this turn of events; however, we understand the Navy's decision given the current national budget crisis and the lack of a defense appropriations bill," Mulherin wrote.
"While we hope to find a resolution soon, any delay in the Lincoln's arrival will clearly impact the efficiency of the original plan and the Navy's operational readiness," he said in the letter. "We will continue to work closely with our customer so that when the decision is made to move Lincoln into dry dock, we can do so as seamlessly as possible."
In a news release, shipyard spokeswoman Christie Miller said prep work on the Lincoln as well as work on the contract for the ship's midlife overhaul will proceed, despite the hurdle presented by the Navy's decision.
"We continue to actively negotiate the Lincoln RCOH contract with the Navy, and we intend to continue our efforts on the ship at the Navy base in Norfolk and will work to make as much progress as possible, as efficiently as possible, prior to its arrival," Miller said.
In the weeks leading up to the postponement decision, Pentagon officials have said they were looking for areas to cut because they were not prepared to operate under a continuing resolution that froze defense spending at 2012 levels.
The size and scope of the four-year overhaul made the RCOH a large target. The deferral is also the latest in a string of drastic money saving measures, announced by defense officials.
The Pentagon recently postponed indefinitely its deployment of the USS Harry S. Truman., a move that forced thousands of families of sailors preparing to ship off to make last second arrangements.
But the Lincoln overhaul is the first large shipyard project to get shuffled around to save money.
"(T)his reduction would significantly impact thousands of skilled shipyard workers, who have labored to develop their skills and will represent a blow to the future capabilities of Newport News to deliver timely and cost effective ships to the fleet," said U.S. Rep. Randy Forbes, R-Chesapeake, who first announced the Navy's decision.
In a phone interview, Forbes said the decision is a reminder that defense funding is insufficient "to weather bumps in the road."
And he said its imperative Congress takes quick action to restore funding to the Pentagon: "We need to get a Defense Authorization bill passed."
Beyond that, Forbes said he favors "taking national defense out of this sequestration craziness," across-the-board cuts that would hit all federal agencies and have a longer term impact on the Newport News shipyards.
U.S. Rep. Robert C. "Bobby" Scott, D-Newport News, whose district includes the shipyard, said the postponement decision is shameful.
"The men and women at Newport News Shipbuilding, who build, repair, and maintain the most advanced naval fleet in the world, deserve better than this," Scott said.
As recently as Thursday, Miller, the shipyard spokeswoman, said workers were busy making preparations for the Lincoln under the assumption that a contract would be finalized. The potential for a delay was reported in Friday's Daily Press.
Carrier RCOHs are intricate projects that add up to billions of dollars in revenue for Huntington Ingalls Industries the parent company of the shipyard, which is also the nation's only manufacturer of new aircraft carriers.
The overhauls involve refueling a carrier's reactors, performing repairs and upgrading its systems after more than two decades of wear and tear. The Lincoln, which until August had been stationed at Naval Station Everett, Wash., was commissioned in November 1989.
The original contract for the ongoing RCOH of the USS Theodore Roosevelt was worth $2.43 billion, and contract modifications have increased the overall price tag to $2.59 billion.
Deferring the Lincoln overhaul helps the Pentagon stay within a 2012 budget allocation, and top Navy officials have identified a number of upcoming shipbuilding and ship repair projects not finalized through contracts as possible targets.
The Navy's reaction to the lower budget amount has "essentially cancelled all 3rd- and 4th-quarter (maintenance) availabilities," said retired Rear Adm. Joe Carnevale, referring to the six-month period starting in April.
Carnevale, a senior defense advisor with the Shipbuilders Council of America, said the impacts of the delayed projects would be devastating for the industry and especially smaller repair yards and contractors.
"There are many small businesses that won't be able to survive a 6-month hiatus," he said.
Another senior defense advisor with the council, Ashley Godwin, said that so far the preparation work for the Lincoln has been funded in a piecemeal fashion.
The shipyard has received about $700 million for advance planning in four installments, according to a Department of Defense web site.
Godwin said it's possible the Navy could find just enough money to get the overhaul started, rather than signing a more comprehensive contract covering the four years overhauls traditionally take.