American Shipbuilding Association

Senator Stevens Receives Herbert H. Bateman Award

On June 11, the American Shipbuilding Association honored Senator Ted Stevens (R-AK) with the Herbert H. Bateman Award for consistent, outstanding leadership in support of a strong shipbuilding industry. Named after the late Representative from Virginia, Herbert H. Bateman, the award is the shipbuilding industry's highest honor. Throughout his 34 years in the Senate, Senator Stevens has been the sponsor or supporter of every major shipbuilding program and initiative to have been enacted in the U.S. Congress.

While some appropriators do not support long-term funding proposals of major defense systems, which are viewed as limiting the ability of the Appropriations Committees from making annual adjustments, Senator Stevens, Chairman of the Appropriations Committee, has led the Nation in supporting cost-saving initiatives such as Multi-Year Procurement Contracting (MYP), Incremental Funding of multi-year ship construction programs, and long-term leasing of defense auxiliary ships. These acquisition approaches provide the taxpayer with tremendous cost savings by providing multi-year stability in program and workforce planning by shipyards; economic quantity order purchases of ship sets of equipment, which provide unit cost savings and stability in the shipyard supplier base; and making the construction of needed ships for our national security affordable in these times of the lowest rates of naval ship production in our Nation's history since 1932.

The media criticizes most Members of Congress for championing programs as merely "special interest projects to bring home jobs for their constituents", said Cynthia Brown, President of the American Shipbuilding Association. The leadership that Senator Stevens has demonstrated for a strong shipbuilding industry, strong Navy, Marine Corps, Coast Guard, and Merchant Marine cannot be labeled in those terms. He does not have a major shipyard in his state. His actions to build a strong shipbuilding industry to support our Nation's sea services is based on the fact that the livelihood and security of Alaskans depends on the sea - as does that of all Americans - whether they realize it or not, said Ms. Brown. "He is a true statesman, and that is why he is so deserving of the Herbert H. Bateman Award."

Previous recipients of the award include Representative Herbert H. Bateman (R-VA) (2000), Senator Olympia Snowe (R-ME) (2001), and Representative Gene Taylor (D-MS) (2002).

(Pictured left to right: Paul Robinson, Vice President of Ingalls Operation; Senator Ted Stevens; Michael Toner, President of Electric Boat and Senior Vice President General Dynamics Marine Systems; Tom Schievelbein, President of Newport News Shipbuilding; Philip A. Dur, President of Northrop Grumman Ship Systems; George Yount, Vice President of Avondale Operation and ASA Chairman; Laura Bateman; Dugan Shipway, President of Bath Iron Works; and Richard Vortmann, President of National Steel and Shipbuilding Company.)

The Senate bill approves the Navy's request for multi-year procurement (MYP) for the Virginia class submarine, but approves only five submarines rather than the seven the Navy requested. The Senate Appropriation Committee stated in its report accompanying the bill that while it recognizes the cost savings associated with MYP, the Committee believes that it is premature to commit the Navy to procure more than one submarine a year for FY 2004-2009. S 1382 also recommends cutting $189 million from the SSN-774 account citing a lack of financial information from the Navy and making adjustments for a multi-year authority request. The legislation also adds $20 million for modernization and upgrades of the DDG-51 class of surface combatants and $75 million for advance procurement of long lead materials for LPD-17 to facilitate the procurement of LPD-23 in FY 2005. 

Expressing concerns over construction delays in the T-AKE program, the Senate cut $722 million and two ships from the National Defense Sealift Fund, dropping the number of overall new construction naval ships from seven to five. 

The House legislation, HR 2658, cuts $405 million for Virginia class submarine procurement, and rejects the Navy's request for a multi-year procurement contract for the submarine class. The bill adds $175 million to the Administration's request for LPD-17 to support procurement of a ship in FY 2005. 

Reservations regarding the Navy's next generation of ships also led the House Appropriation Committee (HAC) to cut $110 million from the $1 billion requested for the DD(X) destroyer program. Distinguishing between the concept and actual design of the destroyer, the HAC believed that the Navy had failed to yield concrete design plans, definitive requirements, or a clear acquisition strategy. Construction on DD(X) is expected to begin in 2005. Additionally, House appropriators cut $15 million from the Littoral Combat Ship (LCS) program, but added $25 million to LCS for mission module development. Though supportive of the LCS program, the HAC noted in its report the absence of necessary requirement documentation or comprehensive development plans as the ship approaches the procurement phase. The first purchase of an LSC is planned for FY 2005.

The HAC also recommended terminating the LHA(R) program by cutting $64.9 million from Navy R&D accounts. The LHA(R) is the Marine Corps's new class of big-deck amphibious assault ships. The Committee questioned the merit of the program, citing that the FY04 budget request lacked information stating a definitive requirement, an incomplete analysis of alternatives, and late award of the FY03 design contract. According to the HAC report, if the Navy wishes to continue with the program, it must submit a report to Congress justifying the role of the new vessel and cost of the program.

The House and Senate are expected to begin their conference after the August recess.

The Senate Commerce, Science and Transportation Committee approved on June 26th S 1262, the Maritime Administration Authorization Act. The legislation authorizes appropriations for the Maritime Administration (MARAD). Chairman of the Committee John McCain (R-AZ) and ranking member Fritz Hollings (D-SC) offered an amendment to include a reauthorization of the Maritime Security Program (MSP). 

During the Committee mark, Senator Trent Lott (R-MS) offered an amendment to include a U.S. build component to the MSP reauthorization, mirroring what Rep. Duncan Hunter included in HR 1588, the House FY 2004 Defense Authorization bill. The Lott Amendment, which was adopted, authorizes $250 million for the construction of five clean product tankers in the U.S. to be enrolled in the Maritime Security Program. 

The Lott Amendment also authorizes $50 million in new loan guarantees for the Title XI Ship Loan Guarantee Program (HR 1588 authorized $39.5 million), in addition to striking many of the onerous and overreaching structural changes to the program proposed in the original version of S 1262. Many of those requirements went beyond what the Department of Transportation Inspector General recommended in a report issued in March 2003, and again in a June 5th hearing before the Commerce Committee, and would have rendered the program impossible to execute. 

The amended version of S 1262 will serve as the Commerce Committee's position on the Defense Authorization conference between House and Senate Armed Service Committee members regarding MARAD and MSP.

Marlo Coil Joins ASA

Marlo Coil of High Ridge, MO has joined ASA as a new Partner member.  Marlo Coil is the largest supplier of marine coils, air handling units, product coolers, and refrigeration plants to the U.S. Navy.  The company is also a major supplier to the Military Sealift Command and U.S. Coast Guard.   

EPA Recognition

The American Shipbuilding Association (ASA) and five of its member shipyards (Avondale Operation, Bath Iron Works, Electric Boat, Ingalls Operation and NASSCO) were singled out for praise by Mr. Thomas J. Gibson, the Chief of Staff for the Administrator of the Environmental Protection Agency (EPA), in a formal recognition ceremony at EPA Headquarters on July 9, 2003.  The purpose of the ceremony was to acknowledge the participation of those shipyards that participated in the development of a Pilot Environmental Management System (EMS) Program for shipyards, which will now be used as a model guide for shipyards to reduce pollution through the use of best management practices.  Ideally, EPA would like for all companies throughout all industrial sectors to adopt an EMS Program.  ASA anticipates that by the end of this year all six ASA shipyard members will have an EMS Program in place.

Well Said!