Stopgap budget creates problems for sub work

Groton - The stopgap spending measure that is currently funding the federal government poses problems for two major endeavors at Electric Boat, the construction of Virginia-class submarines and the design of a new class of submarines.

After the House and Senate failed to pass a budget this fall, Congress and the administration agreed to a continuing resolution that freezes funds at last year's levels to keep the government running until March 4. The hitch is, the Navy needs more money this year to pay for submarine construction and design than it did last year.

Last year the Navy bought one Virginia-class submarine for $1.96 billion. This year it is supposed to buy two for $3.44 billion. The current contract with Electric Boat requires that the Navy pay for the two fiscal 2011 submarines - in full- by the end of this month.

And, anything short of the current fiscal year's full funding for the Navy's next generation of ballistic-missile submarines, past this March, will jeopardize the design maturity and construction start dates, driving up costs, according to the Navy.

To keep the Virginia-class program on track, the Navy wants to push back the deadline for fully funding the second submarine, and instead pay for the first submarine plus the construction materials for the second submarine to keep that second sub on track, the Navy said in a statement.

"They have been working with us to make sure we can modify the contract in such a way to avoid any disruption to the production schedule or the procurement of materials schedule," EB President John P. Casey said.

The picture becomes more complicated if the continuing resolution is extended. Past March 4, the current spending levels "will not support needed progress" on the Virginia-class program, according to the Navy.

Electric Boat and Northrop Grumman Shipbuilding in Virginia are supposed to start building the first Virginia-class submarine for this year's order, the 13th member of the class (SSN 786), in March.

Construction work on the second submarine, (SSN 787), is scheduled to start in the fall.

Navy officials signed a $14 billion contract with Electric Boat in December 2008, committing the service to buy one ship per year in 2009 and 2010 and two ships per year from 2011 through 2013.

U.S. Rep. Joe Courtney, D-2nd District, said he would push for an "anomaly" in any new continuing resolution, or language that would support the two submarines annually.

"There really is not a whiff of opposition out there in terms of funding it, in the administration or in Congress," he said. "This is trying to get the mechanics of the budget process completed."

EB is planning to hire between 300 and 400 more engineers for its growing New London design and engineering campus, many of whom will work on the next generation ballistic-missile submarine to replace the current fleet of Ohio-class, or Trident, boats.

The Navy said it needs the full funding for the current fiscal year in March for further research and design, as well as engineering evaluations. The administration included about $670 million in this year's defense budget, yet to be approved, for the ballistic-missile submarine, an increase over the $495 million approved last year.

"There was a ramp-up plan," Casey said. "And to be honest, it's a lot less clear to me whether there's a problem or not because that's in a big pile of research and design money. I think the Navy and the Department of Defense have the authority to program those funds as they see fit."

He added, "We're on the path to do what we were planning to do this year, and I know the Navy is trying to make sure that program stays on track. No one is trying to change that I hope."


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