FullCommitteeTranscript v2

FullCommitteeTranscript v2
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HOUSE COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE HOLDS A
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HEARING ON THE COAST GUARD DEEPWATER PROGRAM
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APRIL 18, 2007
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SPEAKERS:
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REP. JAMES L. OBERSTAR, D-MINN. CHAIRMAN
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REP. NICK J. RAHALL II, D-W.VA.
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REP. PETER A. DEFAZIO, D-ORE.
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REP. JERRY F. COSTELLO, D-ILL.
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DEL. ELEANOR HOLMES NORTON, D-D.C.
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REP. JERROLD NADLER, D-N.Y.
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REP. CORRINE BROWN, D-FLA.
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REP. BOB FILNER, D-CALIF.
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REP. EDDIE BERNICE JOHNSON, D-TEXAS
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REP. GENE TAYLOR, D-MISS.
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REP. JUANITA MILLENDER-MCDONALD, D-CALIF.
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REP. ELIJAH E. CUMMINGS, D-MD.
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REP. ELLEN O. TAUSCHER, D-CALIF.
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REP. LEONARD L. BOSWELL, D-IOWA
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REP. TIM HOLDEN, D-PA.
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REP. BRIAN BAIRD, D-WASH.
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REP. RICK LARSEN, D-WASH.
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REP. MICHAEL E. CAPUANO, D-MASS.
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REP. JULIA CARSON, D-IND.
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REP. TIMOTHY H. BISHOP, D-N.Y.
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REP. MICHAEL H. MICHAUD, D-MAINE
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REP. BRIAN HIGGINS, D-N.Y.
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REP. RUSS CARNAHAN, D-MO.
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REP. JOHN SALAZAR, D-COLO.
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REP. GRACE F. NAPOLITANO, D-CALIF.
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REP. DANIEL LIPINSKI, D-ILL.
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REP. DORIS MATSUI, D-CALIF.
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REP. NICK LAMPSON, D-TEXAS
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REP. ZACK SPACE, D-OHIO
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REP. MAZIE K. HIRONO, D-HAWAII
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REP. BRUCE BRALEY, D-IOWA
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REP. JASON ALTMIRE, D-PA.
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REP. TIM WALZ, D-MINN.
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REP. HEATH SHULER, D-N.C.
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REP. MICHAEL ARCURI, D-N.Y.
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REP. HARRY E. MITCHELL, D-ARIZ.
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REP. CHRIS CARNEY, D-PA.
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REP. JOHN HALL, D-N.Y.
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REP. STEVEN L. KAGEN, D-WIS.
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REP. STEVEN I. COHEN, D-TENN.
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REP. JERRY MCNERNEY, D-CALIF.
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REP. JOHN L. MICA, R-FLA. RANKING MEMBER
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REP. DON YOUNG, R-ALASKA
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REP. TOM PETRI, R-WIS.
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REP. HOWARD COBLE, R-N.C.
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REP. JOHN J. "JIMMY" DUNCAN JR., R-TENN.
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REP. WAYNE T. GILCHREST, R-MD.
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REP. VERNON J. EHLERS, R-MICH.
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REP. STEVEN C. LATOURETTE, R-OHIO
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REP. RICHARD H. BAKER, R-LA.
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REP. FRANK A. LOBIONDO, R-N.J.
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REP. JERRY MORAN, R-KAN.
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REP. GARY G. MILLER, R-CALIF.
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REP. ROBIN HAYES, R-N.C.
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REP. HENRY E. BROWN JR., R-S.C.
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REP. TIMOTHY V. JOHNSON, R-ILL.
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REP. TODD RUSSELL PLATTS, R-PA.
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REP. SAM GRAVES, R-MO.
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REP. BILL SHUSTER, R-PA.
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REP. JOHN BOOZMAN, R-ARK.
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REP. JIM GERLACH, R-PA.
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REP. MARIO DIAZ-BALART, R-FLA.
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REP. KENNY MARCHANT, R-TEXAS
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REP. CHARLIE DENT, R-PA.
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REP. TED POE, R-TEXAS
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REP. DAVE REICHERT, R-WASH.
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REP. CONNIE MACK, R-FLA.
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REP. JOHN R. "RANDY" KUHL JR., R-N.Y.
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REP. LYNN WESTMORELAND, R-GA.
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REP. CHARLES BOUSTANY JR., R-LA.
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REP. JEAN SCHMIDT, R-OHIO
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REP. CANDICE S. MILLER, R-MICH.
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REP. THELMA DRAKE, R-VA.
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REP. MARY FALLIN, R-OKLA.
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REP. VERN BUCHANAN, R-FLA.
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WITNESSES:
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MICHAEL DE KORT,
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FORMER PROJECT MANAGEMENT SPECIALIST FOR 123 SYSTEMS,
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LOCKHEED MARTIN
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ROBERT BRADEN,
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SENIOR TECHNICAL STAFF,
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PROCESSOR AND SYSTEMS DESIGN,
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LOCKHEED MARTIN
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SCOTT SAMPSON,
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SECTION CHIEF,
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DEVELOPMENT SECTION OF THE U.S. COAST GUARD MAINTENANCE AND
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LOGISTICS COMMAND ATLANTIC VESSEL SPECIFICATIONS BRANCH
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JAMES ATKINSON,
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PRESIDENT AND SENIOR ENGINEER,
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GRANITE ISLAND GROUP
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THOMAS RODGERS,
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VICE PRESIDENT,
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TECHNICAL OPERATIONS,
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LOCKHEED MARTIN MARITIME SYSTEMS & SENSORS
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BRUCE WINTERSTINE,
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PRINCIPAL PROJECT ANALYST,
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LOCKHEED MARTIN MARITIME SYSTEMS & SENSORS
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MARYANNE LAVAN,
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VICE PRESIDENT,
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ETHICS AND BUSINESS CONDUCT,
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LOCKHEED MARTIN
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LEO MACKAY,
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VICE PRESIDENT AND GENERAL MANAGER,
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COAST GUARD SYSTEMS;
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JAMES ANTON,
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EXECUTIVE VICE PRESIDENT OF ICGS
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T.R. HAMBLIN,
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VICE PRESIDENT,
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GOVERNMENT AFFAIRS,
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BOLLINGER SHIPYARDS
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MARC STANLEY,
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EXECUTIVE VICE PRESIDENT,
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GOVERNMENT AFFAIRS,
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BOLLINGER SHIPYARDS
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DEBU GHOSH,
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NAVAL ARCHITECT AND BRANCH CHIEF,
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COAST GUARD BOAT ENGINEERING BRANCH
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JOE MICHEL,
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ASSISTANT DEPUTY,
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SYSTEMS IMPLEMENTATION,
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COAST GUARD NATIONWIDE AUTOMATIC IDENTIFICATION SYSTEM
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PROJECT
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LIEUTENANT COMMANDER CHAD JACOBY,
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PROGRAM MANAGER,
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SCALEABLE COMPOSITE VESSEL PROTOTYPE PROGRAM IN THE SCIENCE
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& TECHNOLOGY DIRECTORATE,
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DEPARTMENT OF HOMELAND SECURITY
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CATHY MARTINDALE,
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CONTRACTING OFFICE CHIEF,
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COAST GUARD ENGINEERING AND LOGISTICS CENTER
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REAR ADMIRAL GARY BLORE,
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PROGRAM EXECUTIVE OFFICER,
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COAST GUARD INTEGRATED DEEPWATER SYSTEM
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VICE ADMIRAL PAUL SULLIVAN,
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COMMANDER,
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U.S. NAVAL SEA SYSTEMS COMMAND
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[*]
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OBERSTAR: We meet today in full committee to inquire into compliance of
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the Coast Guard with the requirements of the Deepwater contract.
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When I was elected to the chairmanship of the committee, I said at the
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very outset that we would have a strong emphasis on oversight and
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investigations into the programs within the jurisdiction of our
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committee.
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It has long been a role of this committee, going back to 1959, when the
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special investigating committee in the Federal-Aid Highway Program was
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established by then Speaker Rayburn, and my predecessor, John Blotnik,
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whose portrait is over there in the corner, was designated chair of that
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committee.
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It was the very first deep investigative work of the House in the
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post-World War II era that resulted in conversion of all state federal
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highway programs from no internal audit and review procedures to every
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state having internal audit, review and accountability for their federal
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highway funds.
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It also resulted in 36 people going to federal and state prison for
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their illegal activities in misuse and abuse of public funds in the
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Federal-Aid Highway Program.
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The committee continued its work into other areas of jurisdiction of the
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full committee doing enormous good service to the public. We continue
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that work in the spirit of inquiring into the wise, best and most
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effective use of public funds and ensuring that there is not a failure
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on the part of federal agencies in carrying out their public trust.
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Of all the issues that have come before our committee -- we've had a lot
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since the beginning of this session of Congress -- the failures of the
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Coast Guard Deepwater acquisition program are the most disturbing.
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The Investigations and Oversight bipartisan staff has been conducting
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in-depth investigations over the last three months on the conversion of
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110-foot patrol boats to 123-foot boats, which is a 12 percent
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extension, and to modernize their electronics in the new era of
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security, and the new or the additional mission of the Coast Guard in
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homeland security.
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OBERSTAR: The investigation uncovered factors far more disturbing than
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we anticipated at the outset or than other committees that have looked
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into this have uncovered. Major problems in the program -- some of the
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major problems -- have already been disclosed in hearings of other
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committees and by news reports.
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But four years after the Coast Guard began the Deepwater program to
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replace or upgrade all of its ships, fixed-wing aircraft and
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helicopters, we know that eight of the 110-foot patrol boats have been
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found unseaworthy and rendered essentially useless by poorly designed
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hull extension.
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It's already on public record that plans to produce a new class of
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140-foot ships have been shelved after a new hull design was found to be
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flawed. It's already been published that serious questions have been
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raised about the structural integrity of the new National Security
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Cutter, and whether it can be expected to meet its projected lifetime in
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service.
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There are problems that have increased the cost of the fleet renewal
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program from $17 billion to more than $24 billion. We know that the
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Coast Guard's ability to fulfill its mission has been compromised, that
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critically needed assets are not going to be available, or certainly not
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available in the timeframe within which the Coast Guard needs them.
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The Coast Guard constantly has been forced to cut back on patrols. At
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times, it's had to ignore tips from other federal agencies about drug
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smugglers. We are concerned these difficulties will only grow and become
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more acute in the years ahead as older vessels fail and replacements are
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not available.
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What we have learned in our investigation, though, is even more
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disturbing: serious management failings, which are serious, internal to
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the Coast Guard.
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OBERSTAR: We're not going to pass final judgment on those charges or
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allegations until we have had the response to the Coast Guard and its
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contractors.
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I should point out that the testimony we will hear today raises serious
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problems that were known early in the program by the Coast Guard, and
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that warnings delivered by very courageous persons involved in the
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program in the earliest days were delivered, and many of the warnings
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consciously rejected by various levels of Coast Guard management.
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I commend those whom are witnesses here before us today, who have helped
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us understanding what happened, and who have put their jobs, their
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careers on the line in order to do the right thing and assure that the
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truth is out, in particular Michael De Kort, Robert Braden, Scott
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Sampson.
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And Mr. Atkinson is not a Coast Guard employee, but he is a similarly
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public spirited person who has prepared an extensive analysis of the
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internal problems.
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The Coast Guard has taken a lessons learned approach to the tragedies,
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the failures that have occurred in the conversion programs, and we hope
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that today's hearing will make a major contribution to improving,
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changing, not only the way the Coast Guard does this, but the culture --
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the very culture -- within the Coast Guard. Time will tell, but one
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thing is certain: We're going to stay on top of it.
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OBERSTAR: The chair recognizes the gentleman from Florida, the ranking
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member, Mr. Mica.
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MICA: Thank you, Mr. Chairman.
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And I have some comments. I'm a little bit concerned.
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This is the first of our investigative hearings. And going forward
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today, with some terms, or under some terms that I thought were a little
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bit different than what I had anticipated.
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I do have some issues that I do want to raise. The committee is
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continuing today in what I was led to believe was oversight of the Coast
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Guard's very important Deepwater program.
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Unfortunately, after reviewing the materials for this hearing, most of
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what we're going to hear, or go through, in a series of panels, appears
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to be matters that we have already reviewed. I guess some of it may be
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redundant, because I've not only participated in at least two hearings
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on this committee, but also Government Reform Committee on which I
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serve, which has also looked into this. This is, I believe, the sixth
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hearing -- this is the sixth hearing held this year. And number seven is
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next week in the Senate.
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I do want to say that I've been impressed with the conduct of the
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chairman of the subcommittee, Mr. Cummings and the ranking member, Mr.
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LaTourette. They stated that they would continue to pursue this matter
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and have subsequent testimony from the DHS I.G. and the General
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Accountability Office just last month.
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In the January hearing Mr. Cummings, chair of the subcommittee, and the
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Commandant Allen agreed that there would be a hearing 120 days later in
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which the Coast Guard would report also on changes in the program and
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progress that has been made. And I think that's very important that we
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review that.
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MICA: I come from the state of Florida. We have these eight cutters that
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are now, I'm told they've been brought up here to the northeast from
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Florida. They're not usable. These cutters are critical to safety, to
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national security, to questions of the problems we face on illegal
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immigration.
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Last week, we had I believe over 100 Haitians just come in in one batch.
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And the warm weather hasn't started.
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The Coast Guard has a mission dealing with the illegal narcotics, which
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is critical. And I don't have those assets there, whether there are 40
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of these cutters. These are eight. A large percentage of these cutters
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are out of service.
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And I know there are some plans in place. And it's critical that we have
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-- that we deal with these issues I've mentioned, not to mention the
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possibility of some change in the regime with Castro and critical needs
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without the vessels in place.
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So no one is more deeply troubled than I am about the problems
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associated with the 110-foot cutters to 123-foot cutters, which was the
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effort under way.
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However, I'm afraid, again, that this hearing merely rehashes some of
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the issues the I.G. has gone through and reviewed and testified about at
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our Coast Guard budget hearing last week.
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And I do have the questions that were raised -- I'd like to submit for
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the record, and then the responses, which are some of the same questions
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again today. I'd like to...
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OBERSTAR: Without objection, they'll be included.
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MICA: ... have that included. In addition, I must point out, again, this
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is our first -- this is very important, that this is the first of our
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investigative hearings.
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And both Mr. Oberstar and I are committed to strong investigations and
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oversight. We think that's an important part of our responsibility.
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However, the minority was not included in the selection or the
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interviewing of these witnesses. And given the traditional bipartisan
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nature of the work on Coast Guard and maritime transportation, this
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causes me great concern.
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In government reform, for example, we don't interview a witness or
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depose a witness without notification and the opportunity to have a
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bipartisan participation.
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That does concern me. And I hope that's not the way we proceed in the
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future.
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I also understand that one of today's witnesses, as staff has told me,
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is being paid by the committee, the taxpayers, as a consultant. And I
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think that's Mr. Atkinson. Is that correct?
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OBERSTAR: Only his travel and expenses were covered...
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MICA: So he is being paid...
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OBERSTAR: ... as in the tradition of the committee.
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MICA: Again, I am concerned about the selection of witnesses and,
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particularly, those -- well, we're going to hear from a whistleblower,
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and I think he has some important information to share with the
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committee.
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I'm not certain because, again, our staff was not permitted to interview
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him at the same time that he was actually in position to be able to
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comment on some of the issues related to certification, et cetera, that
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he may be testifying on. So that raises questions.
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Secondly, with Mr. Atkinson, I'm just totally at a loss of why he was
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permitted to be a witness. Now, I did not see this until yesterday, and
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staff provided me with this yesterday, but anyone can go on to
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www.TSCM.com. That's his Web site.
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In 15 years of having witnesses before numerous subcommittees, some of
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which I chaired or participating on different committees, I never had a
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witness who set forth a mission statement or qualifications as some --
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let me read from his -- and you all pull this up and see it.
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"I will not have anything to do" -- these are quotes from his Web site.
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"I will not have anything to do with someone I know to be a criminal,
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and if I seen the slightest reason to believe that they have a criminal
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history, I will back away from them the second I find out about it. In
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fact, not only will I start backing away from them, but they will hear
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me reloading the shotgun as I do it."
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Second paragraph: "If someone chooses to be an eavesdropper, I'll hunt
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them to the ends of the earth. If they're a felon or a crook using
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electronics in their work, I will relentlessly stalk them until they are
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rendered impotent."
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Third paragraph: "When the eavesdropper lies on his deathbed and the
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Angel of Death comes to take him away, I want Death to be holding a scan
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lock instead of a scythe. I want them constantly looking over their
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shoulder and expecting TSCM specialists to pounce on them and start
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beating them with a MLJD, let them fear black boxes and weird- looking
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antennas. Let them eat Xanax by the handful and spend their days in
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pain."
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Four paragraph: "Let them be afraid, let them be very afraid, for I am
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hunting them. I'm not hunting -- them, then -- someone who I trained
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will be afraid of -- I perform bug sweeps like a contact sport. I don't
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play fair."
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I've never heard a witness give those kind of qualifications.
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MICA: Again, the rest of it is troubling to me. The staff pointed this
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out. So I do have concerns about the witnesses, and particularly that
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witness.
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The Deepwater program, as I said, is critically important, and we need
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to have the best witnesses and access to the best information and
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resources to make certain that we have enhanced vessels and aircraft in
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place as quickly as possible, at the lowest cost to the taxpayer.
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In January, Admiral Allen appeared before the committee and committed
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himself and the Coast Guard to improving the oversight, which is very
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important.
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Finally, I do have concerns about two things.
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One, it's also the custom that we investigate and then we make a
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determination, and I'm prepared to do that and work with the chairman
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and the ranking member for calling the Department of Justice to look, if
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we find in this hearing or subsequent hearings criminal and civil
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misconduct that warrants an investigation, not to announce that to the
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media before we hold the hearing.
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And then the second concern that I have is that the Coast Guard has now
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made an announcement, prompted by some of these inquiries -- and I'm not
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sure that it's the wisest announcement -- to go forward with in-house
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actually control and management of these contracts, which I don't know
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they have the capability of doing and which testimony we've heard
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previously and in other committees indicated that their inability to
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pay, their inability to retain personnel, attract personnel or put a
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program like this into place for oversight, they don't have -- they may
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not have that oversight capability or ability even to maintain that
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capability.
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So in the meantime I pledge to continue to work with the majority. This
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is a very important issue. And I'm sorry that we did get off with some
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unacceptable terms in both procedures and witnesses for this first
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hearing.
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Yield back.
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OBERSTAR: I read the same comments on the Web site, and I took them in a
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different vein.
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But, Mr. Atkinson, after he's sworn in, will have an opportunity to
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respond to the ranking member's comments.
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OBERSTAR: As to witnesses, I directed the majority staff to share with
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minority the names of witnesses. And they're free to call and inquire
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and interrogate them as they wish. And they had all the names.
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As for redundancy, I can't control what other committees do, I say to my
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good friend. If they want to have hearings, that's their business. But
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we're conducting our business.
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We did have a preliminary hearing earlier this year on Deepwater. It set
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the stage for what I felt was a necessary -- and what you and I both
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discussed was a necessary, more intensive discussion and inquiry into
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these matters.
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As for the Justice Department, we make no judgment. Justice is
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conducting its own inquiry into this matter. And after the conclusion of
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our hearings, and in consultation with the ranking member, we will
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decide what next steps to take.
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The gentleman from Maryland, chairman of the subcommittee, Mr. Cummings
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-- at the outset I want to say has conducted a very thorough inquiry and
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has given an enormous amount of his personal time and been actually on
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board the defective vessels -- I recognize the gentleman for his
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statement.
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CUMMINGS: I want to thank the gentleman for moving.
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And I want to thank you, Mr. Oberstar, for your dedication and effective
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oversight and for convening this hearing today to continue requiring
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accountability. And I emphasize accountability on the part of the Coast
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Guard as well as its contractor, partner for implementation of the
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Deepwater acquisition program.
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I must say that as I listened to Mr. Mica, I think we have to very
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careful that we don't assassinate witnesses before they even testify.
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These witnesses come to us, some of them I'm sure with some fear. But
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they have stepped forward bravely, and I am very, very familiar with
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their testimony.
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CUMMINGS: And I know that they have the concerns of the American people
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and the Coast Guard and Coast Guard personnel, by the way, in mind.
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Deepwater is a $24 billion -- and I emphasize "billion-dollar" --
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procurement effort, through which the Coast Guard is acquiring 91
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cutters, more than 100 small surface craft, and 244 new or converted
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aircraft, including helicopters and fixed-wing airplanes.
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Americans trust the Coast Guard to protect them from emerging threats
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approaching our homeland from the sea, to rescue them when they are in
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danger and to protect the natural resources of our marine environments.
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That trust is well placed. However, Americans also need to know that
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they can trust the Coast Guard's leaders to manage the taxpayers'
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hard-earned dollars effectively and efficiently, and to provide the
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tools that the men and women of the Coast Guard need to succeed.
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Further, Americans need to know that, when a multibillion-dollar
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contract is signed, the parties to that contract will accomplish its
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objectives to the best of their abilities.
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Our expectations for the Deepwater program are not unreasonable. We
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expect it to produce boats that float, planes that fly, and information
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technology systems that work, meaning that they allow us for
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identification of threats in the maritime domain, while protecting
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sensitive and classified communications and allowing effective control
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of deployed assets.
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What is remarkable and completely unacceptable is that a program costing
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on the order $100 million, intended to upgrade 110-foot legacy cutters,
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lengthen them to 123 feet, and extend their service lives, has produced
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eight cracking hulks that are now tied up within a few miles of my house
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in Baltimore, unable to return to service and waiting for the scrap
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heap.
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And guess who paid for them? The American people.
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What is unconscionable is that the simple and straightforward
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expectations of Congress, and more importantly, the American taxpayers,
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have not been met because of a combination of poor oversight by the
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United States Coast Guard and poor performance by two of the world's
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largest defense contractors, Lockheed Martin and Northrop Grumman.
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I applaud the action taken yesterday by Admiral Thad Allen, the
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commandant of the United States Coast Guard, to begin to right what has
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become a floundering acquisitions effort, veering far, far off course.
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I believe that this decisive leadership will put this program on a path
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to success.
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However, though the commandant has taken bold steps to bring the systems
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integration functions back in-house, to rebid parts of the Deepwater
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contract, and to ensure that assets are independently certified against
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the highest industry standards, it is essential that we learn the
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lessons of the past five years of Deepwater implementation, so that past
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errors are never repeated.
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I've said it before, and I'll say it again. This is the country that's
550
able to send folks to the moon. We ought to be able to build ships that
551
float.
552
553
Today, therefore, we examine the 123 program. We will take a close look
554
at all of the actions of the Coast Guard and its partner, the integrated
555
Coast Guard systems team, that contributed to the colossal failure of
556
the program.
557
558
We want to know why the Coast Guard and its partners went ahead with the
559
design to lengthen the 110-foot cutters, despite warnings from the
560
United States Navy that the hulls should have been strengthened before
561
they were lengthened, warnings based on the Navy's own experience
562
lengthening the 170-foot Cyclone-class ships to 179 feet.
563
564
CUMMINGS: We will also closely examine whether the equipment installed
565
inside the converted 123-foot boats met all contractual requirements and
566
was designed to ensure safety of the crews -- and I emphasize that,
567
safety of the crews.
568
569
We want to make sure that Coast Guard personnel are safe.
570
571
And so, further, we want to examine whether the C4ISR command-
572
and-control system was properly certified to ensure the protection of
573
national security data.
574
575
I applaud the willingness of the dedicated individuals who worked in
576
various capacities in the Deepwater program to come forward today to
577
share their concerns about what they experienced on that program and
578
about the actions taken by managers leaving the program.
579
580
The committee's investigation also received critical assistance from an
581
outside expert on TEMPEST process, who has dedicated countless hours of
582
his own personal time to analyzing TEMPEST certification process on the
583
123s.
584
585
I thank Michael DeKort, Robert Braden, Scott Sampson and James Atkinson
586
for their dedication to excellence. Our committee shares their
587
dedication.
588
589
Therefore, while we examine what must be done to ensure the success of
590
Deepwater, we also will be examining what must be done to build
591
acquisition systems and develop experienced management personnel within
592
the Coast Guard who can ensure that a single dollar is never, ever
593
wasted in the procurement of a ship or plane for the Coast Guard fleet.
594
595
And with that, Mr. Chairman, I yield back.
596
597
OBERSTAR: I thank the gentleman for his very strong statement and again
598
for his very diligent work.
599
600
And I recognize -- I yield now to the gentleman from Ohio, the ranking
601
member of the subcommittee, Mr. LaTourette.
602
603
LATOURETTE: Thank you very much, Mr. Chairman. I'll try and move along
604
expeditiously.
605
606
I want to thank you and Chairman Cummings for holding this hearing. And
607
I have to say that I come to this hearing with a deep concern over the
608
future success of the Deepwater program. As I indicated at the
609
subcommittee hearing in January, there is no more important issue facing
610
the Coast Guard now than the delays and setbacks that are jeopardizing
611
this program.
612
613
This hearing today is going to focus on the conversion of the 110-foot
614
patrol boat fleet. And I believe that we will examine and use this
615
hearing to examine the roots of the problems that resulted in this
616
failure and how the Coast Guard, I hope, will look -- how the Coast
617
Guard can apply the lessons learned to future acquisition projects.
618
619
The original Deepwater contract, which has now run a number of years,
620
established performance requirements for each asset and component
621
system. It appears that in too many cases the responsibilities to
622
oversee, test and certify construction and performance of these assets
623
and systems has been vested in the contractors and not the Coast Guard.
624
625
The Coast Guard has addressed these issues under Commandant Allen's
626
direction, it was announced just yesterday. And I have confidence that
627
the Coast Guard will take a much more active role in reviewing and
628
ultimately approving or disapproving asset designs, performance, testing
629
and compliance with contract requirements.
630
631
While I appreciate the commandant's new directives and willingness to
632
address past problems, I remain concerned by the number and nature of
633
problems that seem to come to light every time this committee holds a
634
hearing.
635
636
LATOURETTE: It appears that there were several opportunities to make
637
significant changes to the design and the structure of the 123- foot
638
patrol boat hull, and that Coast Guard chose not to take those
639
corrective actions.
640
641
As a result, the Coast Guard took possession of eight vessels that can't
642
be used for any mission by the Coast Guard, and are now scheduled to be
643
scrapped.
644
645
The loss of these eight vessels and the impending delay in requiring
646
more capable vessels hurts the Coast Guard's ability to safeguard and
647
secure our nation's waters, and jeopardizes the safety of Coast
648
Guardsmen that serve aboard increasingly aged and deteriorating vessels.
649
650
I'm further concerned by the apparent lack of control procedures that
651
allow a contractor to install self-certified component systems that have
652
not been tested against industry or military standards.
653
654
The Coast Guard is responsible for ensuring that the assets and systems
655
that it accepts meet all terms and conditions of the contract and all
656
relevant performance specifications. Under the commandant's new
657
directions, the Coast Guard will take on additional responsibilities to
658
verify compliance.
659
660
I can't emphasize enough how critical these new responsibilities are for
661
the future of the service. The Deepwater program and the assets that
662
will be acquired under Deepwater are critical to the Coast Guard's
663
future mission success.
664
665
The men and the women of the Coast Guard carry out brave and selfless
666
service to our nation each and every day. And we need to make sure that
667
the Deepwater program is carried out in a way that the best, most
668
capable equipment is acquired to allow these Coast Guardsmen to carry
669
out their important missions.
670
671
I want to thank the witnesses for appearing today.
672
673
And, Mr. Chairman, on the way over from my last series of votes, I
674
mentioned some matters to subcommittee Chairman Cummings, and I'm not
675
going to bring those up at this moment. But they do relate to issues
676
that Mr. Mica was addressing, and I hope that we -- maybe the four of us
677
could have a conversation in the future about some of those things.
678
679
I thank you for your courtesy and yield back the balance of my time.
680
681
OBERSTAR: I thank the gentleman for his statement, for his ever
682
public-spirited concern about the work of this committee.
683
684
We have had some difficulties in proceeding with this hearing because we
685
requested on March 20 documents from the Coast Guard, did not get what
686
we were requesting until March -- not until April 6.
687
688
And not until subcommittee Chairman Cummings met with the commandant did
689
we get at 5 p.m. Friday, April 13 the full set of documents that we
690
requested much earlier.
691
692
That hampered and made difficult the task of saying -- structuring this
693
hearing and getting the information we needed. So there have been some
694
difficulties along the way. And we made our best effort to include the
695
Republican side in this process and gave to staff the names of witnesses
696
right at the outset, and how to contact them and invited the minority
697
staff to conduct their own individual inquiry.
698
699
(UNKNOWN): Will the chairman just yield for...
700
701
OBERSTAR: Yes.
702
703
(UNKNOWN): I think the chairman and the full committee knows that I --
704
there's no member of Congress that I have greater respect for, and even
705
affection for, than the chairman.
706
707
My invitation was that maybe, as we move forward, we can do a little bit
708
better in talking to each other.
709
710
OBERSTAR: We always can do better. And we will.
711
712
713
(UNKNOWN): Thank you.
714
OBERSTAR: Now I call -- I ask all witnesses to rise. Raise your right
715
hand.
716
717
Do you solemnly swear the testimony you'll give before the Committee on
718
Transportation and Infrastructure is the truth, the whole truth and
719
nothing but the truth, so help you God?
720
721
OBERSTAR: Thank you.
722
723
Mr. De Kort, we'll begin with you, and welcome your statement. And,
724
again, I say that you have provided an enormous service to the public
725
and to the committee, and I think, in the long run, to the Coast Guard
726
by the work that you've done, so please proceed.
727
728
DE KORT: Thank you, Mr. Chairman, for those comments.
729
730
Good afternoon, Mr. Chairman, and the members of the committee. I deeply
731
appreciate your taking the time to hear testimony on the C4ISR problems
732
relating to the Deepwater effort.
733
734
While I will be highlighting the C4ISR issues, I'm sure you realize that
735
they are only examples of the systemic engineering and management
736
problems associated with this effort. The problems I will be describing
737
are not simply mistakes; they were informed, deliberate acts. As I will
738
show, I have been trying to resolve these problems for almost four
739
years.
740
741
After not being able to convince every level of management of every
742
relevant organization in Lockheed Martin through to the CEO and Board of
743
Directors -- and I believe there's a timeline up that shows some of that
744
information -- as well as working with Integrated Coast Guard Systems, I
745
turned to the appropriate government agencies, public officials,
746
whistleblower organizations, and when all else failed, the Internet and
747
the press for help.
748
749
What needs to be understood here is that every one of these problems was
750
easily resolved with off-the-shelf products well before any of the
751
assets were delivered.
752
753
Additionally, as the contract mandates system commonality, every one of
754
these problems is a candidate for inclusion on every other maritime
755
asset that ICGS delivers for the lifetime of the contract. This plan, if
756
allowed to come to fruition, will literally cripple the entire maritime
757
fleet of the U.S. Coast Guard for decades.
758
759
Before delving into the issues, I would like to tell you a little bit
760
about my background. I was an electronics technician in the U.S. Navy
761
for six years. I specialized in communications systems. After my
762
enlistment ended, I spent a brief time in the private sector before I
763
joined the U.S. State Department as a communications engineer for
764
embassy and consular duties, as well as for the counterterrorism group.
765
After leaving that organization, I became a systems engineer in Lockheed
766
Martin. Through the years, I was promoted to project, program, and
767
engineering manager. During my last five years, I was a software project
768
manager for Aegis Baseline 6.3, the lead systems engineer of C4ISR for
769
the Deepwater effort and the software engineering manager for the NORAD
770
effort.
771
772
It is the period where I held the C4ISR lead systems engineer position
773
that is the focus of this testimony. At the point I joined the effort in
774
the summer of 2003, the final design review had been completed and most
775
of the equipment had been purchased for the first several boats.
776
777
In addition to creating a master schedule, I was tasked with identifying
778
the final, deliverable requirements and planning the integration of the
779
first boats. It was during this period that several critical safety and
780
security issues came to my attention.
781
782
The first problem was that we had purchased nonweatherproof radios for
783
the Short Range Prosecutors, or SRPs. The boats are small, open aircraft
784
that are constantly exposed to the environment. Upon first hearing about
785
this issue, I have to admit I found it too incredible to believe.
786
787
Who would put a nonweatherproof radio, the primary means of
788
communication for the crew, on a boat with no protection from the
789
elements? The individual who brought this to my attention strongly
790
suggesting that I look into it, no matter how incredible it sounded.
791
792
DE KORT: I called the supplier of the radio who informed me it was true.
793
We had purchased four radios for the first four SRPs and they were not
794
weather-proof.
795
796
As a matter of fact, the vendor asked me to not use the radios on any of
797
the SRPs, which would eventually total 91 in all.
798
799
Upon informing Lockheed management that the radios needed to be
800
replaced, I was told that there was a design of record. This meant the
801
customer had accepted our designs at the conclusion of the critical
802
design review and that we would make no changes that would cause cost or
803
schedule impacts.
804
805
As a matter of fact, we ordered five more radios after I went to
806
management about the problem in order to prepare for the next set of
807
boats we were contracted to modify.
808
809
I tried for several months to get the radios replaced. Just before
810
delivery of the first 123 and its associated SRP, the customer asked to
811
test the system. Coincidentally, it rained on test day. During the
812
testing, several radios shorted out.
813
814
It should be noted that had we not tested the boats in the rain on that
815
day we would have delivered that system and it would have failed the
816
very first time it was used.
817
818
After this, I was told we would go back to the radio that originally
819
came with the SRPs. I believe that this example, more than any other,
820
demonstrates the lengths the ICGS parties were willing to go to hold to
821
schedule and budget while sacrificing the safety and security of the
822
crew.
823
824
The next problem uncovered involved the video surveillance system. The
825
Coast Guard wanted a system that would permit watching the boats when in
826
a Coast Guard port without someone having to be physically on the boat.
827
828
Our solution was to provide a video surveillance system that had
829
significant blind spots, leaving the bridge -- or pilot house --
830
vulnerable to penetration.
831
832
The most frustrating part about this issue is that the simple purchase
833
and installation of a fifth camera would have resolved the problem. Bear
834
in mind, we knew about the need for the extra camera several months
835
before the first 123 was delivered.
836
Another problem we discovered involved low-smoke cables. There was a
837
requirement to install low-smoke cables so that in case of a fire flames
838
do not spread quickly, equipment is not overly exposed to corrosive
839
smoke, and the crew is not exposed to a large amount of toxic fumes.
840
841
In a recent report, the inspector general for Department of Homeland
842
Security confirmed that over 80 of these cables are the wrong type and
843
that waiver the Coast Guard gave to the contractor said it could avoid
844
having to provide these cables was invalid.
845
846
DE KORT: The next issue involved communications security and the
847
standards necessary to ensure those communications are safeguarded from
848
eavesdropping or inadvertent transmission of crosstalk.
849
850
These standards are known as TEMPESTs. We installed non-shielded cables,
851
101 in all, on all of the 123s, cables that did not meet standard
852
TEMPEST and safety and security requirements, as borne out by their
853
failing of the visual inspection which was carried out by the
854
appropriate test authority.
855
856
This situation could lead to serious compromise of secure communications
857
not only for the Coast Guard, but for the government or other government
858
organizations such as DOD, FBI and DEA.
859
860
I was informed that we had not included these cables in the design
861
because we had not bid the TEMPEST requirements. And as such, we decided
862
we did not have the money to include them.
863
864
The final significant problem was that of the survivability of the
865
external mounted equipment. I saved this one for last because of how
866
serious the repercussions are for the Coast Guard and nation.
867
868
The fact that the DHS I.G. agreed completely with my allegations
869
relative to this issue, the incredible position Lockheed Martin has
870
taken on this issue and the fact that the Coast Guard seems unwilling to
871
allow them to get away with it -- surely before the first 123 was
872
delivered, we finally received the environmental requirements.
873
874
During the late review of the requirements -- of the equipment for
875
compliance, well after the design, review and purchase of the equipment,
876
we found the very first item we looked into would not meet environmental
877
requirements. Given this failure, we feared the rest of the equipment
878
may not meet environmental requirements.
879
880
Let me state this in simple terms: This meant the Coast Guard ships that
881
utilized this equipment would not operate in conditions that could
882
include heavy rain, heavy seas, high winds and extreme temperatures.
883
884
When I brought this information to Lockheed management, they directed me
885
and my team to stop looking into whether or not the rest of the
886
equipment met requirements. This meant that all of the externally
887
mounted equipment being used for the critical communication, command and
888
control, and navigation systems might fail in harsh environments.
889
Since that time, we have learned through DHS I.G. report on the 123s
890
that 30 items on the 123s, and at least a dozen items installed on the
891
SRPs did not meet environmental requirements.
892
893
In addition to their technical and contractual findings, the I.G. also
894
made some of Lockheed Martin's responses on this issue known in that
895
report.
896
897
Incredibly, the I.G. states that Lockheed Martin incorrectly stated in
898
their self-certification documents that there were no applicable
899
requirements stipulating what the environmental requirements were in
900
regard to weather. And they actually stated that they viewed the
901
certification of those requirements as, and I'm quoting, "not really
902
beneficial."
903
904
In addition, the I.G. states that the Coast Guard did not know the boats
905
were noncompliant until July of 2005, one and a half years after the
906
first 123 was delivered. The report also states that none of these
907
problems were fixed, not on any of the delivered boats.
908
909
That, along with this issue, not being called out in the DD-250
910
acceptance documents, supports my supposition that Lockheed Martin
911
purposely withheld this information from the Coast Guard.
912
913
DE KORT: Finally, the I.G. states that Lockheed's position on them
914
passing the self-certification without testing these items was the right
915
thing to do because they thought the tests would be -- and I'm quoting
916
again -- "time consuming, expensive and of limited value."
917
918
Bear in mind that the contractors have stated time and time again in
919
front of this and other oversight committees that they do not practice
920
self-certification.
921
922
Where does the situation leave us?
923
924
Had the hulls not cracked or the cracks not appeared for some time, ICGS
925
would have delivered 49 123s and 91 SRPs with the problems I described.
926
927
In addition to that, the Deepwater project is a system of systems
928
effort. What this means is that the contractor is directed to deliver
929
solutions that would provide common equipment sets for all C4ISR
930
systems.
931
932
Said differently, all the equipment for like systems need to match
933
unless there's an overwhelming reason not to. This means that every
934
faulty system I've described here will be installed on every other
935
maritime asset delivered over the lifetime of the effort. This includes
936
the FRCs, the OPCs and the NSCs. If we don't stop this from happening, I
937
suggest we'll deliver assets with these and other problems.
938
939
I believe this could cripple the effectiveness of the Coast Guard and
940
their ability to perform their missions for decades to come.
941
942
943
How have the ICGS parties reacted to the totality of the allegations?
944
At first, Lockheed and the U.S. Coast Guard stated, as stated by the
945
ICGS organization responded to my allegations by saying they were
946
baseless, had no merit or that all of the issues were handled
947
contractually.
948
949
That evolved, after the I.G. report came out, to then stating that the
950
requirements had gray areas. And later, by actually deciding, after the
951
systems were accepted and the problems were found, that in some cases
952
the Coast Guard exaggerated their needs and it was their -- as was their
953
comment regarding the environmental survivability problems.
954
Up until the announcement yesterday, I have heard a lot of discussion
955
about the changing of the ICGS contract structure, the fixing of the
956
requirements, reorganizing the Coast Guard and adding more oversight.
957
958
While all of those things are beneficial, they in no way solve the root
959
problem. Had the ICGS organization listened to the Engineering Logistics
960
Center, or ELC, and my recommendations, there would be no problems on
961
these boats.
962
963
We wouldn't be talking about more oversight or making sweeping changes.
964
Instead, we would be discussing what a model program Deepwater is.
965
966
I guarantee you that had the changes that were made up until yesterday's
967
announcement been made four or five years ago, it wouldn't have
968
mattered. Even with the incestuous ICGS arrangement, the less-
969
than-perfect requirements and minimal oversight, there was plenty of
970
structure in place and information available to do the right thing.
971
972
It is not practical to think that one can provide an ironclad set of
973
requirements and associated contract that will avoid all problems. All
974
that was needed were leaders who were competent and ethical in any one
975
of the key contractor or Coast Guard positions. Any one of dozens of
976
people could have simply done the right thing in this effort and changed
977
the course of events that have followed.
978
979
It is because of that that I strongly suggest you shift -- suggest your
980
focus shift to one of accountability in an effort to provide a
981
deterrent.
982
983
DE KORT: No matter what structure these parties put in place, no matter
984
what spin they come up with, promises they make, no matter how many
985
people you spend taxpayer dollars to employ to provide more oversight,
986
it still comes down to people.
987
988
We wouldn't need more oversight if the ICGS parties would have done as
989
they promised when they bid the effort.
990
991
They told the Coast Guard, we know you have a lack of personnel with the
992
right skills; let us help you; let us be your trusted agent; let us help
993
write the requirements so we can provide you cutting-edge solutions; let
994
us write the test procedures and self-certify so we can meet the
995
challenges we all face in the post-9/11 world.
996
997
In the end, people have to do the right thing, and know that, when they
998
don't, the consequences will be swift and appropriate. I strongly
999
believe that, especially in a time of war, the conduct of these
1000
organizations has been appalling.
1001
1002
As such, I would hope that this committee and other relevant agencies
1003
with jurisdiction will do the right thing and hold people in these
1004
organizations accountable.
1005
1006
All defense contractors and employees of the government need to know
1007
that high ethical standards are not matters of convenience.
1008
1009
If you do not hold these people and organizations accountable, you will
1010
simply be repackaging the same problems and have no way of ensuring the
1011
problems don't happen again on this or any other effort.
1012
1013
In closing, I am offering to help, in any way I can, to remedy these
1014
issues. As I told Commandant Allen's staff and Lockheed Martin, before
1015
my employment was terminated, I want to be part of the fix.
1016
1017
With the right people in place and the right positions, this project can
1018
be put back on track rapidly.
1019
1020
I would like to thank you again for the opportunity to testify, and look
1021
forward to answering your questions.
1022
1023
OBERSTAR: Thank you very much for a very thorough, thoughtful and
1024
well-structured statement.
1025
1026
Mr. Braden, would you identify yourself and then proceed with your
1027
statement?
1028
BRADEN: Yes, thank you, Mr. Chairman and members of the committee. My
1029
name is Robert Braden, and I have over 40 years of engineering
1030
experience, including nearly 30 years of service with Lockheed Martin
1031
Corporation.
1032
1033
I'm currently employed by Lockheed as a senior technical staff at
1034
Morristown, New Jersey. In this position, I'm often expected to provide
1035
program and project leadership for a variety of programs.
1036
1037
In early 2003, I was requested to join the U.S. Coast Guard Deepwater
1038
program as a lead system engineer for the communication area master
1039
stations, or CAMS, and legacy cutter program.
1040
1041
That program was to do upgrades of three different classes of cutters
1042
that were -- did not include the 123s.
1043
1044
Program objectives were to provide enhanced satellite communications and
1045
modern C4ISR systems for these existing legacy assets.
1046
1047
This included installations, upgrades, and new capabilities for 39
1048
existing legacy cutters. We provided significantly improved satellite
1049
bandwidth, improved shipboard networks, new (inaudible) radios, new
1050
automatic identification systems, and expanded secret Internet protocol
1051
router networks, or SIPRNet communications capabilities.
1052
1053
These improved SIPRNet capabilities provide the legacy fleet with the
1054
ability to significantly improve coordination of law enforcement and
1055
homeland security actions with the U.S. Navy and within the Coast Guard.
1056
1057
After completing the total re-plan of the program, we submitted an
1058
aggressive fixed-price proposal to the Coast Guard. Unfortunately, the
1059
Coast Guard contracting office continued to extend negotiations all the
1060
way to the end of the fiscal year.
1061
1062
This required Lockheed Martin to either stop work or independently fund
1063
the continued engineering and procurement of our long-lead material.
1064
1065
Lockheed elected to support the aggressive Deepwater deployment
1066
objectives of Admiral Stillman, and provided several million dollars of
1067
internal risk funding to allow my team to obtain the material, integrate
1068
the system and prepare for the first installations.
1069
1070
BRADEN: During this same period of development and design, I was engaged
1071
in intensive dialogue with my Coast Guard contracts technical
1072
representative, with the Coast Guard ships integration personnel, and
1073
with the Coast Guard's Telecommunication Security Organization, known as
1074
TISCOM.
1075
1076
The purpose was to determine and negotiate all requirements for the cams
1077
(ph) legacy installations. Our key objective was to provide a
1078
communication installation that would immediately achieve a SIPRNet
1079
interim authority to operate, followed shortly thereafter by a full
1080
authority to operate. And the reason that was important is these ships
1081
were in port for a limited period of time. When those ships left port,
1082
our installation needed to allow the crew to immediately use the new
1083
secure capabilities.
1084
1085
I was also fully engaged in weekly program integration meetings
1086
involving all Morristown management of the Deepwater program. These pit
1087
meetings were mandatory every week and covered all aspects of the
1088
program and included at every meeting U.S. Coast Guard representatives;
1089
generally included representatives from the ICGS or Integrated Coast
1090
Guard Systems organizations.
1091
1092
The purpose of the meetings were to ensure coordination among the
1093
various programs and maintain commonality among all the assets. Topics
1094
included status of the system-of-systems activities, the cams (ph)
1095
legacy cutter upgrades, the 123 foot cutter conversion program, and the
1096
other various assets.
1097
1098
Approximately once each month, the PIT meetings, Program Integration
1099
Team meetings, would expand to a full Deepwater program review with all
1100
management present, and that usually included the ICGS, the different
1101
subcontractors, as well as the Coast Guard officers.
1102
1103
On numerous occasions I presented the design, installation and security
1104
briefings appropriate to my cutter class to ensure coordination of our
1105
cams (ph) and legacy plans.
1106
1107
During these PIT meetings, the various LSEs, or lead system engineers,
1108
would become aware of the problems and issues faced by their
1109
counterparts. So part of the purpose of the meeting was to make sure we
1110
compared notes and made sure that we all met a common design.
1111
1112
We would occasionally compare notes to see if a common resolution to our
1113
problems were possible. Often, the aggressive pace of my own project and
1114
the structure of the Deepwater program required that my team maintain
1115
focus on our own design issues.
1116
1117
However, whenever I found an issue that concerned me and I was unable to
1118
influence a change, I would advise upper management of the problem.
1119
1120
In August 2003, my team began upgrades of the cams (ph) (inaudible) or
1121
the Master Station Atlantic facility, an installation of the first
1122
Deepwater sea-based asset, the U.S. Coast Guard Northland. We completed
1123
these installations within one month, thereby establishing the milestone
1124
of the first successful asset delivery to the Coast Guard Deepwater
1125
progwram.
1126
1127
BRADEN: And by year end, we followed this achievement with the
1128
successful installation of the Deepwater C4ISR suite aboard the Cutter
1129
Tampa. The subsequent string of successful installations has been a
1130
continuing source of personal satisfaction for my design and
1131
installation team. I personally take great pride in expeditiously and
1132
cost-effectively completing the first successful and compliant Deepwater
1133
installations in the history of the program.
1134
1135
I continue to manage and guide the installation of the first nine
1136
270-foot legacy cutters, and develop the design and installation
1137
procedures for the remaining 210- and 378-foot cutters. In March 2004, I
1138
was removed from the Deepwater program and transferred to another
1139
program.
1140
1141
This concludes my testimony. I'd be please to answer any questions the
1142
committee may have.
1143
1144
OBERSTAR: Thank you, Mr. Braden.
1145
1146
Mr. Sampson, please identify yourself and proceed to your testimony.
1147
1148
SAMPSON: Good afternoon, Congressman Oberstar, Congressman Cummings and
1149
distinguished committee and subcommittee members. My name is Scott
1150
Sampson. I have been requested to come before you today to discuss my
1151
involvement with the 123 Program as associated with the Deepwater
1152
program.
1153
1154
I have a unique perspective of this program in that I work for the DOD
1155
agency which expressed grave concern about a potential extension of a
1156
110-foot patrol boat to 123 feet, and then changed jobs to work for a
1157
Coast Guard office which supports these modified cutters.
1158
1159
Today, I will tell you about the people I communicated my concerns to
1160
that were, unfortunately, realized.
1161
1162
If I may request, Mr. Chairman, I would like my written statement
1163
entered into the record.
1164
1165
OBERSTAR: Without objection, so ordered. Your statement will be included
1166
in the record.
1167
1168
SAMPSON: Thank you, sir.
1169
1170
The DOD agency I worked for was the Combatant Craft Division, a
1171
detachment of the Naval Surface Warfare Center Carderock Division,
1172
otherwise known as CCD. CCD had designed a similar extension on a
1173
similar platform and felt, based on lessons learned, that the proposed
1174
method of modification of the 110 was at a high risk for failure.
1175
1176
While I was with CCD, three key contacts were made to express concerns
1177
over the proposed design modification. The first was Debu Ghosh of the
1178
Coast Guard's Engineering Logistics Center. Mr. Ghosh was the branch
1179
chief of the Boat Engineering Branch. Second, was Diane Burton of the
1180
Coast Guard's Deepwater program office. Ms. Burton is the Deepwater
1181
surface technical director. The third person that was contacted was
1182
Dennis Fanguy of Bollinger Shipyard. Mr. Fanguy was the head of their
1183
engineering department.
1184
1185
These conversations were conducted in the August to September 2002
1186
timeframe, with the exception of Mr. Fanguy who was contacted shortly
1187
thereafter.
1188
1189
It was explained to each of these individuals not only concerns
1190
associated with a proposed modification of the 110, but where those
1191
concerns stemmed from as they pertained to a similar experience with a
1192
Navy craft. These concerns centered around several items, but
1193
specifically included longitudinal strength, running trim and
1194
engineering experience.
1195
1196
Mr. Ghosh appeared to share our concerns and attempted to hire combatant
1197
craft to assist with oversight. Specifically, Mr. Ghosh requested, and I
1198
provided, a statement of work and an estimate to provide 14 days on
1199
onsite support at Bollinger Shipyards consisting of two naval
1200
architects, and also to provide an seakeeping analysis comparing the 110
1201
to the 123.
1202
1203
SAMPSON: The estimate for this level of support was $42,000.
1204
1205
Mr. Ghosh told me shortly thereafter that the Deepwater program office
1206
would not supply the funding. Conversations with the other two contacts,
1207
Ms. Burton and Mr. Fungeye (ph), were short with little discussion.
1208
1209
Matagorda was inducted into Bollinger shipyard on the 2nd of February,
1210
2003. On the 5th of March, 2004, the Matagorda was delivered back to the
1211
Coast Guard, and on 10th of May, 2004, entered a post-delivery
1212
maintenance availability.
1213
1214
Within days of leaving this availability, in early part of September
1215
2004, Matagorda suffered damage in the middle of the cutter, buckling
1216
the side shell and deck.
1217
1218
This is the type of longitudinal failure that the combatant craft
1219
division anticipated seeing, and had warned the Coast Guard and
1220
Bollinger shipyard about.
1221
1222
This predicted failure occurred not as a result of fatigue or corrosion,
1223
but rather from one short period of operation in a sea reported to be
1224
four to six feet in height.
1225
1226
This longitudinal (inaudible) failure was acknowledged in a report
1227
issued by ELC entitled, "Matagorda Buckling Incident Analysis," dated 24
1228
September, 2004, and verified our concerns expressed in August of 2002.
1229
1230
After two attempts to make the 123s usable for service, the Coast Guard
1231
made the decision to lay the vessels up until a final decision could be
1232
made as to whether or not they could be repaired.
1233
1234
The Coast Guard made this decision after extensive inspection of the
1235
cutters. All eight cutters are currently located at the Coast Guard
1236
yard.
1237
1238
Mr. Chairman, this concludes my own statement. I'll be more than happy
1239
to answer any questions you may have.
1240
1241
OBERSTAR: Thank you very much, Mr. Sampson. That's very critical
1242
testimony for the inquiry of the committee.
1243
1244
I've heard a couple of cell phones or other devices going off. Under the
1245
committee rules, all communication devices must be inaudible. Turn them
1246
off, or put them on vibrate.
1247
Mr. Atkinson -- and you may feel free in your remarks to respond to the
1248
issues raised by Mr. Mica earlier.
1249
1250
ATKINSON: Thank you, sir.
1251
1252
My name is James Atkinson. I'm the president and senior engineer of
1253
Granite Island Group, located in Gloucester, Massachusetts.
1254
1255
We specialize in electronics engineering. We perform bug sweeps. We
1256
perform wiretap detection. We stop technical espionage. We plug leaks,
1257
both in classified and in unclassified communication systems.
1258
Essentially, we hunt spies.
1259
1260
I am considered to be one of the top international experts on the
1261
subject matter of TSCM TEMPEST, and technical security.
1262
1263
I have attended private and government-sponsored TSCM TEMPEST,
1264
cryptographic technical intelligence, electronics and security training
1265
both in the United States and abroad. I have been involved in many
1266
hundreds of TSCM TEMPEST inspections over the last 25 years of
1267
government service and private sector assignments.
1268
1269
My clients include the major -- heads of the major corporations, heads
1270
of state, diplomats, government agencies, defense contractors,
1271
hospitals, courthouses, political leaders, ministers, small businesses,
1272
large ministers and virtually every walk of our country.
1273
1274
Due to the nature of my -- of the services I render to my clients, it
1275
would not be prudent to disclose precisely who they are. However, I've
1276
been to Washington, D.C. many times on business to render such services.
1277
1278
I am one of the few people who can clearly explain the highly technical
1279
and highly classified subject matters such as TEMPEST and TSCM to this
1280
committee in an unclassified way, so that a non-technical layman can
1281
understand it. And I can provide a voice of reason.
1282
1283
ATKINSON: The documents in this matter are highly technical, and it
1284
takes a TEMPEST and TSCM expert to fully understand what is really in
1285
those documents, what it really represents, and what they really mean,
1286
and to bring forth the gravity of what is really going on.
1287
1288
The core message here is that TEMPEST is a rigorous series of government
1289
standards which have been developed by the National Security Agency. The
1290
purpose is to protect classified equipment, signals and information from
1291
eavesdropping.
1292
1293
TEMPEST focuses on securing classified equipment and systems in order to
1294
keep electronics from leaking secrets. Our foreign adversaries know
1295
about TEMPEST and a related field and know how to steal our electronic
1296
secrets from equipment that does not comply with these rigorous
1297
standards.
1298
1299
For example, the nations of Cuba, Iran, India, China, Colombia, France,
1300
North Korea and many other countries have become quite adept in
1301
eavesdropping on our improperly protected classified equipment.
1302
1303
While most countries are our allies, the United States has designated
1304
over 30 nations to be openly hostile to the United States. And there is
1305
strong evidence that these countries not only do have the equipment to
1306
eavesdrop on our leaking equipment, but do so on a regular basis.
1307
1308
Gentlemen, it's my unpleasant duty to inform you that the Coast Guard,
1309
ICGS and Lockheed Martin have been highly negligent in their oversight
1310
of the Deepwater program, that many millions of dollars has been wasted
1311
on ships that don't float and classified electronics which leak national
1312
security secrets.
1313
1314
During my review of the technical documents in this matter, I discovered
1315
that the United States Coast Guard was not being forthcoming with
1316
information to this committee and that the Department of Homeland
1317
Security Office of Inspector General had previously requested in regard
1318
to C4ISR and TEMPEST issues.
1319
1320
I found that instead they were hiding malfeasance within these documents
1321
and a deeply flawed procurement process.
1322
1323
Further review determined that there was significant lack of oversight
1324
on the part of the United States Coast Guard and that they were using
1325
doublespeak in their answers to this committee and evading politically
1326
uncomfortable questions put before them.
1327
Based on the analysis of the numerous documents, to include detailed
1328
TEMPEST reports, which the Coast Guard eventually, albeit begrudgingly,
1329
provided to the committee, I was able to determine the following: From
1330
the very beginning, the very first day of the program, the Coast Guard
1331
did not clearly define the technical specifications and standards that
1332
these ships had to comply with in order to protect classified
1333
information.
1334
1335
The contractor, in turn, delivered substandard and highly defective
1336
assets, as there was little or no Coast Guard oversight on the project,
1337
even though the government was paying the contractor to provide
1338
oversight as the integrator.
1339
1340
The Coast Guard accepted delivery of these defective ships, and instead
1341
of correcting many of defects, merely covered them up with waivers or
1342
used substandard parts to create the illusion of a repair.
1343
1344
ATKINSON: An example is unclassified and classified local area network
1345
connection boxes were supposed to be separated from each other. The
1346
Coast Guard chose to resolve this problem merely by putting stickers on
1347
the equipment, as opposed to fixing it. So they patched the leak with a
1348
Post-it note.
1349
1350
Not only has the contractor responsible for this waste butchered eight
1351
valuable ships and rendered them worthless, they have then endangered
1352
national security in delivering ships that leak secrets, contain
1353
significant vulnerabilities and which provide a clear and present danger
1354
to our national security.
1355
1356
The Coast Guard was, and still is, spending money like a drunken sailor
1357
on shore leave with minimal oversight. The Coast Guard lacks the core
1358
competencies and resources to protect this classified information
1359
through their TEMPEST program. ICGS has taken advantage of the United
1360
States after 9/11, and has taken advantage of the Coast Guard in
1361
particular. The Coast Guard put more priority on its public relations
1362
program than it did with her TEMPEST program.
1363
1364
My recommendations is that the -- this committee pull the plug on the
1365
Coast Guard's access to classified information, that it revoke SIPRNet
1366
access and essentially revoke the Coast Guard's security clearance. This
1367
should be done by the end of business today.
1368
1369
Also, I recommend that you initiate an exhaustive, top-down study of all
1370
COMSEC -- Coast Guard COMSEC, TEMPEST, non-stop, TSCM, emissions
1371
security and related technical security and engineering disciplines, and
1372
focus on all assets of the Coast Guard, not just the Deepwater ships.
1373
1374
I recommend that this committee assume that every Coast Guard asset is
1375
suspect until it can be scientifically proven secure through actual
1376
instrumented analysis, and not just waivered as has been the case of
1377
late.
1378
1379
I recommend that all eight cutters be stripped of anything of value, and
1380
that they be sold off as scrap metal.
1381
1382
Cancel or suspend all current and upcoming contracts with ICGS and
1383
Lockheed Martin until this matter can be fully resolved. And consider
1384
issuing an interim debarment against Lockheed Martin and ICGS until
1385
their full management has been forthcoming with appropriate answers.
1386
1387
Also, refuse to allow the Coast Guard to possess, access, obtain
1388
materials or gain access to any classified networks until each asset has
1389
been subjected to a rigorous and independent, highly detailed technical
1390
inspection by somebody outside of the Coast Guard.
1391
1392
Refuse to allow the Coast Guard to purchase any further tactical or
1393
deepwater assets unless other elements of United States government
1394
provide very close oversight of the specifications, designs and
1395
procurement of such systems.
1396
1397
The natural agency to assist the Coast Guard with this would be the U.S.
1398
Navy, who should handle the procurement and oversight of the Coast Guard
1399
assets until such time the Coast Guard is competent and can be trusted
1400
to do this themselves, which they have not been able to of late.
1401
1402
Identify the top command-level officers within the Coast Guard who had
1403
the ultimate responsibility for the oversight of this program, and then
1404
remove them from any further government service.
1405
1406
Finally, we have to assume that Department of Homeland Security is not
1407
competent in these matters, and that their lack of oversight is
1408
widespread and institutionalized.
1409
1410
Patrick Henry stated years ago that we are apt to shut our eyes against
1411
a painful truth. But from my part, I am willing to know the whole truth,
1412
to know the worst of it and to provide for it.
1413
1414
Gentlemen, the project was doomed to fail at the very beginning. When
1415
modern electronics operate, they generate electromagnetic fields.
1416
Digital computers, radios, typewriters and so on generate tremendous
1417
amounts of electromagnetic energy.
1418
1419
Compromising the emanations is that electromagnetic energy. This can be
1420
conducted through the airwaves, over the power lines, over the phone
1421
lines, cable TV. The TEMPEST standards are very rigid as to how these
1422
emanations are controlled.
1423
1424
The Coast Guard completely disregarded all of the specifications except
1425
one, and the one which they chose to pay attention to, they evaded on it
1426
significantly.
1427
1428
Most consumer market equipment leaks significantly. However, if
1429
somebody's computer leaked a little bit of information, they may have
1430
personal embarrassment. If a national security cutter, or a Coast Guard
1431
cutter, or a B-2 bomber or other tactical equipment leaks, national
1432
security is at risk.
1433
1434
This project was doomed to failure. It boils down to two core issues: a
1435
lack of oversight and malfeasance.
1436
1437
On the issue of my mission statement -- my mission statement was
1438
actually published many years ago. It says that I hunt spies and I hunt
1439
bad people. That's what it says.
1440
1441
Lockheed Martin has a real problem with this because that issue was
1442
brought up repeatedly by Lockheed Martin previously after their security
1443
people were caught dealing with convicted felons to purchase illegal
1444
bugging equipment and to do moonlighting.
1445
1446
ATKINSON: This issue was brought up my Lockheed Martin and provided to
1447
the Coast Guard. I have a full audit trail from my Web site logs of them
1448
doing this. That concludes my...
1449
1450
OBERSTAR: Thank you very much, Mr. Atkinson.
1451
1452
Mr. Atkinson has used -- and throughout the testimony, we hear -- the
1453
acronym TEMPEST, which stands for telecommunications electronics
1454
material protected from emanating spurious transmissions. A layman's
1455
definition might be unclassified signals that leak from improperly
1456
shielded cables.
1457
1458
You can go to RadioShack and buy a device that can tap into a modem that
1459
is not properly shielded and get fax information and get computer
1460
information from your neighbor's home, if you wish to do that.
1461
1462
The NATO electronic spies in Germany in the 1950s discovered that they
1463
could break into classified information by using unclassified signals
1464
that allowed them to trace back and into the heart of the technology in
1465
use, and that is why the issue of TEMPEST is so critically important
1466
here.
1467
1468
And we'll come to that later. We have a series of four votes on the
1469
floor. We have eight minutes remaining on the first vote. We will recess
1470
for the four votes, resume immediately thereafter with Mr. Cummings and
1471
the chair. The Committee stands in recess.
1472
1473
(RECESS)
1474
1475
CUMMINGS: Ladies and gentlemen, we're going to resume the hearing. We
1476
left off with Mr. Atkinson to finish his testimony. And I want to thank
1477
our panelists for your remarks.
1478
1479
CUMMINGS: I'm going to start off with a few questions.
1480
1481
Mr. De Kort, you mention in your testimony that you brought a number of
1482
matters to the attention of senior Lockheed management. How high did you
1483
take these issues and what responses did you receive?
1484
1485
DE KORT: I took the matters to the CEO, Robert Stevens, on at least two
1486
occasions, and the board of directors. And the response I received was
1487
that the allegations were baseless or had no merit, and I believe that
1488
was based on Lockheed's contention that they had disclosed all the
1489
issues to the Coast Guard or resolved them, and they were handled
1490
contractually.
1491
1492
CUMMINGS: Now, did you ever contact the Coast Guard directly?
1493
1494
1495
DE KORT: Yes.
1496
CUMMINGS: And since you did that, who did you contact?
1497
1498
DE KORT: I contacted a Commander Ciampaglio and Mr. Jacoby, who's here.
1499
I contacted Lieutenant Commander Derr (ph), who was, I believe, on the
1500
commandant's staff at the time. I contacted the group commander of the
1501
boats in Key West. And I think that's it.
1502
1503
CUMMINGS: And what kind of responses did you receive?
1504
1505
DE KORT: Well, "Thank you," was the response I got.
1506
1507
CUMMINGS: "Thank you"?
1508
1509
DE KORT: Yes. "We're look into it."
1510
1511
CUMMINGS: "But no thank you"?
1512
1513
DE KORT: They didn't say the, "No, thank you," part, but I understand
1514
your point.
1515
1516
CUMMINGS: As a Lockheed employee, had you ever been involved in another
1517
Lockheed project in which the company failed to meet contractual
1518
requirements in the way that you describe on the Deepwater program?
1519
1520
Had you worked on any other contracts?
1521
1522
DE KORT: Not of the same type or scale, no, sir.
1523
1524
CUMMINGS: OK.
1525
1526
What was your role in the installation of the TEMPEST hardware in the
1527
123s?
1528
1529
DE KORT: I was the lead system engineer for the 123s for C4SR, which
1530
meant that the final design, the installation, was my responsibility,
1531
and basically the final design.
1532
1533
Like I'd explained in my statement, I came on board after the final
1534
design review, so everything was pretty much locked in concrete at that
1535
point. And they had ordered all the materials.
1536
1537
The reason why the requirements were brought back up is because, as I
1538
understand it, after the RAND study the Coast Guard asserted a more
1539
aggressive posture in rolling out the programs, because the RAND study
1540
had said, you know, if you want 100 percent mission satisfaction, you
1541
have to pull back your schedule five or 10 years -- and they had
1542
actually recommended 10.
1543
1544
DE KORT: And I believe that was what precipitated us rolling out the
1545
123s differently than was originally proposed.
1546
1547
Originally, there was something called an increment 1. Increment 1 was
1548
their first set of requirements. When I took over the system engineer
1549
role, they decided to deliver an increment 0, which was a subset of
1550
increment 1.
1551
1552
So we were trying to decide: What would that subset be and what were the
1553
requirements associated with it? Did we deliver them entirely, not at
1554
all, partially? So we -- part of my job was to figure out what increment
1555
0 was.
1556
1557
And then, as I was figuring out what increment 0 was, I was asking,
1558
well, then, what is our implementation? What is it we're doing to
1559
resolve that requirement? And where are we in going down that road?
1560
1561
CUMMINGS: Did you all ever come to any conclusions as to what would be
1562
the standard?
1563
1564
You just talked about the conversations that you may have had. And I'm
1565
trying to determine whether or not there was clarity at some point with
1566
regard to what those standards would be.
1567
1568
DE KORT: Well, there was basically, from the very beginning, sir, a
1569
difference of opinion. When these issues were brought forward, the
1570
response was -- and it occurred over and over again -- we have a design
1571
of record.
1572
1573
And what that meant is we don't want to hear it. If what you're bringing
1574
to me is that -- an issue that's going to cause any schedule or
1575
financial problems or cost problems, we're not going to change it; we're
1576
not going to do anything.
1577
1578
CUMMINGS: And I take it you had some concerns about the way things were
1579
proceeding. Is that correct?
1580
1581
DE KORT: Oh, yes, sir.
1582
1583
CUMMINGS: And what were your major concerns or fears?
1584
1585
DE KORT: Well, individually, I think the issues are pretty severe. I
1586
mean, it's the Coast Guard. So if you're putting equipment on Coast
1587
Guard vessels -- and I'm talking about every Coast Guard vessel for the
1588
next 20 years, everything that Deepwater does -- that won't survive the
1589
elements,
1590
1591
OK, that's bad enough.
1592
1593
That you can't use their classified systems without compromising and
1594
have somebody eavesdropping.
1595
1596
You have low smoke cables that if, you know, if they catch on fire, you
1597
know, could cause someone to be overcome with smoke or make the fire
1598
spread faster.
1599
1600
The blind spots on their surveillance system. I mean, the blind spots
1601
were very, very large, and they led right up to the bridge.
1602
1603
So, individually, some of those issues are pretty significant.
1604
1605
In total, I don't think it's an overstatement to say that if they
1606
continued, it would have crippled the Coast Guard.
1607
1608
Had these boats not cracked or had they not cracked for some period of
1609
time, all 49 boats would have been delivered with these issues.
1610
1611
CUMMINGS: The ICGS team produced a document called "Evaluation of
1612
TEMPEST Requirements to be followed aboard the Deepwater 123 (inaudible)
1613
Class patrol boat." And it was authored by a Joe Agat (ph). Are you
1614
familiar with that document?
1615
1616
DE KORT: Yes, sir.
1617
1618
CUMMINGS: And it was dated February 20th, 2003. Is that correct?
1619
1620
DE KORT: Yes, sir.
1621
1622
CUMMINGS: To your knowledge, were the procedures for installing the
1623
TEMPEST hardware spelled out in this guide followed during the
1624
installation of the C4ISR hardware on the 123s?
1625
1626
DE KORT: No, sir, the majority were not followed.
1627
1628
CUMMINGS: And was that book, this document -- I guess this was like the
1629
Bible as far as the guide that's concerned, is that right, as to what
1630
you're supposed to be doing?
1631
1632
DE KORT: Yes, sir, if I could, a little bit of history. As I understand
1633
it, going back to the beginning, there was some disagreement or a lack
1634
of understanding on Lockheed's part of what it meant to do TEMPEST and
1635
to have TEMPEST. And, as such, as it was explained to me, it wasn't bid,
1636
or at least not entirely.
1637
1638
Well, at some point, Lockheed realized that they had classified
1639
circuits. As soon as you put these classified circuits on a boat, you
1640
assume TEMPEST. It's part of the deal. It's what happens. So they asked
1641
an internal engineer to go tell them what they needed to do in order to
1642
satisfy those requirements. And keep in mind, this is after the bid had
1643
been accepted and they had already started.
1644
1645
CUMMINGS: So what you're saying is, is that the bid had been accepted.
1646
1647
DE KORT: Yes.
1648
1649
CUMMINGS: The requirements were not online to be met with regard to
1650
TEMPEST?
1651
1652
DE KORT: They literally didn't know what needed to be done.
1653
1654
CUMMINGS: The Coast Guard did not know?
1655
1656
DE KORT: No, no, no, Lockheed.
1657
1658
CUMMINGS: Lockheed.
1659
1660
DE KORT: Lockheed did not know, at the time they asked for that report
1661
internally, exactly what they needed to do to satisfy the TEMPEST
1662
requirements.
1663
1664
CUMMINGS: Now, you just made a very -- that's a very strong statement
1665
you just made. You understand you're talking about Lockheed Martin, do
1666
you not?
1667
1668
DE KORT: Yes, sir, you don't -- I'm sorry.
1669
1670
CUMMINGS: Let me finish. Now, you're talking about an organization that
1671
is known worldwide for producing all kinds of systems in this realm. You
1672
understand that?
1673
1674
DE KORT: Yes, sir. I'm saying they weren't competent.
1675
1676
CUMMINGS: I'm sorry?
1677
1678
DE KORT: I'm saying they weren't competent, and I can explain how they
1679
got to that position.
1680
1681
CUMMINGS: Well, tell me.
1682
1683
DE KORT: And this was explained to me by Mr. Bruce Winterstine who is on
1684
one of the panels. I was actually on the proposal team for three days.
1685
1686
DE KORT: During that period, when I came in, I had asked Mr. Winterstine
1687
how the bid was going to be structured. And he -- they explained to me
1688
that the Morristown group that primarily does Aegis was going to be the
1689
lead group, and that previously to that there had been another group
1690
that was going to be involved or lead out of Egan, Minnesota, where the
1691
C4ISR engineers were.
1692
1693
And they said, well, we'll going to bid it out of Morristown so we can
1694
leverage Aegis, which strategically is a great idea. Aegis is a
1695
fantastic system. I understand why you want to leverage it.
1696
1697
But I told them, I said, "Look, you people are Aegis engineers, OK, and
1698
you have a software background. You need to go back to Egan, Minnesota,
1699
get the C4ISR experts and have them as part of your team."
1700
1701
And I was told, "No, we don't need to do that." And I asked why. And
1702
they said, "Because Aegis is difficult. We've been doing it for 30
1703
years. We know what we're doing. The C4ISR area is easy. We'll figure it
1704
out, no problem. We don't need that other group." OK.
1705
1706
That's literally how it happened. It's a perfect storm, sir.
1707
1708
So when you get into an aggressive bidding situation where you have to
1709
move out fast, you may have underbid and your staff -- and not in all
1710
cases. Let me say here that there are some very dedicated people,
1711
lower-level engineers who worked extremely hard and some who did have
1712
the background required. But there weren't nearly enough of them. OK.
1713
1714
So they literally shut out the C4ISR experts that they had in the
1715
company. Of course, sir, Lockheed Martin is the world's largest defense
1716
contractor. They have over 100,000 employees. They have plenty of
1717
people, sir, who know how to do this well. And I recommended to them
1718
that they go back to Minnesota and get those people, and they said no. I
1719
fought the issue for three days and they removed me from the proposal
1720
team.
1721
1722
CUMMINGS: So basically what you're saying is that the contractor
1723
personnel and the Coast Guard personnel working on the C4ISR system --
1724
you're saying they weren't qualified to understand TEMPEST, TEMPEST
1725
requirements?
1726
1727
DE KORT: I'm saying, sir, that the people who were involved at time,
1728
that were working on the proposal at the time I was there, were not.
1729
What they were doing is, since Aegis is a very large command and control
1730
system, very complicated, large command and system, I believe they were
1731
trying to leverage that expertise.
1732
1733
DE KORT: And the ironic part is, is C4SR in these areas, since it's all
1734
off the shelf, compared to Aegis, is actually much easier to figure out.
1735
There's not a lot of complicated engineering.
1736
1737
However, you still need to know what you're doing.
1738
1739
CUMMINGS: Overall, why do you think the 123s had so much difficulty
1740
achieving TEMPEST certification?
1741
1742
DE KORT: Because when you have 100 cables that are not the right type, I
1743
mean, you run into problems. I mean, TEMPEST can be moderately difficult
1744
on a very small craft because of very tight space constraints. So a lot
1745
of engineering and thought has to be put into how do you co-locate
1746
systems that are red and black. And Mr. Atkinson can explain later.
1747
1748
But basically red and black were classifications for the part of the
1749
system that is clear and unencrypted and the part of the system that is
1750
encrypted and not clear.
1751
1752
Well, it's very difficult to do on a small ship. But to go the extra
1753
degree to not actually purchase the equipment that is very, very basic
1754
to TEMPEST requirements just starts you off at a very bad place.
1755
1756
In DOD and the State Department, sir, everybody used the proper shielded
1757
cable. It was the backbone -- or one of the backbone items that you
1758
always do.
1759
1760
And they didn't do it because of cost.
1761
1762
CUMMINGS: The Department of Homeland Security I.G. indicates that the
1763
contract on the 123, Mr. De Kort, used aluminum mylar shielded cable as
1764
part of the cutter upgrade. The I.G. indicates that these cables met
1765
minimum Deepwater contract requirements for the shielded cable but do
1766
not have the mechanical durability of the braided metallic shielded
1767
cable.
1768
1769
Do you know which type of cable the ICGS TEMPEST requirements document
1770
required?
1771
1772
DE KORT: Again, sir, this is going to get into an area where even -- I
1773
have a TEMPEST background relative to working on cryptographic equipment
1774
and systems, but you're getting into some particulars that are better
1775
left to Mr. Atkinson. But I can say that.
1776
1777
CUMMINGS: Well, let me ask you this. What type of cabling was installed
1778
on the 110s prior to their conversion?
1779
1780
DE KORT: I've been unable to determine that, sir. I was told that they
1781
had the braided, shielded cable. Not only that, but Mr. Braden can tell
1782
you that the braided, shielded cable was used on his effort, not on mine
1783
-- or on the 123s, I should say.
1784
1785
CUMMINGS: Now, you know Mr. Braden?
1786
1787
DE KORT: Yes, sir.
1788
1789
CUMMINGS: And how did you come to know him.
1790
1791
DE KORT: We were both system engineering leads of our respective parts
1792
in the project.
1793
1794
CUMMINGS: So you have worked with him.
1795
1796
DE KORT: There were occasions, sir, that we did. Mostly it was in
1797
program management meetings. We actually didn't work side by side all
1798
the time.
1799
1800
CUMMINGS: OK. Now did you raise the issue of noncompliance of the
1801
topside equipment on the 123s with senior Lockheed management?
1802
1803
DE KORT: All the way to the CEO and the board of directors, sir.
1804
1805
CUMMINGS: All the way up to who?
1806
1807
DE KORT: The board of directors and the CEO of Lockheed Martin. I went
1808
up through my functional chain, the program management chain, the
1809
engineering chains and the ethics chains, all the way up to the CEO and
1810
board of directors.
1811
1812
CUMMINGS: And when you say you went up to the CEO, board of directors,
1813
what do you mean by that? How did you do that?
1814
1815
DE KORT: I sent e-mails to Robert Stevens, at least two of them, and the
1816
board of directors I sent a letter.
1817
1818
CUMMINGS: To the entire board?
1819
1820
DE KORT: Yes. Well, I sent it to a specific individual who I believe was
1821
the ethics officer on the board.
1822
1823
CUMMINGS: Now did you discuss with anyone at Lockheed the need for
1824
noncompliance of the topside equipment with the Deepwater contract
1825
requirements to be noted on the DD250s? If so, what was the outcome of
1826
those discussions?
1827
1828
DE KORT: I was told before the 123s, the first one delivered, the
1829
Matagorda, that every item that I had brought forth would either be
1830
repaired or clearly called out in the DD250s as being a problem. The
1831
first time I actually saw the DD250s or was told what they contained was
1832
recently. And, as I understand, the DD250 for the Matagorda, that item
1833
does not show.
1834
1835
CUMMINGS: Now, why was topside equipment so crucial?
1836
1837
DE KORT: The topside equipment is all the externally-mounted equipment
1838
that supports the C4ISR system. So for the communications systems, it's
1839
everything on the outside on the boat that you would need for the
1840
systems, usually antennas.
1841
1842
But for sensors, like radar, it's the radar antenna, and there's other
1843
equipment up there like amplifiers. And then for other vessels like the
1844
NSC and the FRC, there would be many, many more systems.
1845
1846
Basically, the 123s had communication systems.
1847
1848
DE KORT: They had sensor systems. And they had navigation systems.
1849
1850
So for those systems, if there was anything that those systems required
1851
to operate, that was attached to the outside of the boat.
1852
1853
CUMMINGS: Let me ask you something.
1854
1855
You mentioned a moment ago the word "ethics." You said you -- something
1856
about an ethics complaint or complaints.
1857
1858
Did you file complaints?
1859
1860
DE KORT: There were three separate ethics investigations internal to
1861
Lockheed Martin conducted.
1862
1863
CUMMINGS: And were those with regard to the issues that you just
1864
mentioned here?
1865
1866
DE KORT: Yes, sir, all of them.
1867
1868
CUMMINGS: Could you just tell us in a sentence or two what those were
1869
now?
1870
1871
DE KORT: The external equipment being able to survive the environment,
1872
the blind spots for the cameras, the (inaudible) cables and TEMPEST.
1873
1874
The reason why the non-waterproof radio was not included is because,
1875
like I explained in my statement, they'd actually swapped it out right
1876
before they delivered the Matagorda. So I did not include that in my
1877
ethics statement other than to say, "Look, you know, any group who is
1878
willing to put a non-weatherproof radio on an exposed boat like that --
1879
something's wrong and something needs to be looked into." And especially
1880
when they order more radios after you tell them it's a mistake.
1881
1882
So it was an incidental item.
1883
1884
CUMMINGS: And what happened with regard to those investigations?
1885
1886
DE KORT: The answer for the first one was, literally, "The allegations
1887
all have no merit. They are all baseless and we're not going to tell you
1888
why."
1889
1890
CUMMINGS: And that was the response from the ethics officer?
1891
DE KORT: It was from a John Shelton, who was the ethics investigator for
1892
the Lockheed Martin organization out of Morristown.
1893
1894
And then after that there were two more investigations. Every time they
1895
came back to me and said that my allegations were baseless, I asked who
1896
their boss was.
1897
1898
CUMMINGS: And then you instead tried to go a step higher?
1899
1900
DE KORT: Yes, sir.
1901
1902
CUMMINGS: Now, would Mr. Braden or anybody else here have known of those
1903
-- because you said you work with Mr. Braden. Would he have known about
1904
that? We'll get to them a little later, but...
1905
1906
DE KORT: Would he have known that I necessarily filed an ethics...
1907
1908
1909
CUMMINGS: Right.
1910
DE KORT: Not that I was aware of. No, sir.
1911
1912
CUMMINGS: All right.
1913
1914
Did you see any evidence of Lockheed -- you mentioned a little earlier
1915
something about underbidding.
1916
1917
Is that -- is this a conclusion you came to, or...
1918
1919
DE KORT: Yes, sir. That's subjective on my part.
1920
1921
CUMMINGS: All right.
1922
1923
DE KORT: It's an observation of being in DOD. It's -- it's aggressively
1924
bid. Projects are basically priced to win. And more often than not, they
1925
turn out to be extremely aggressive, which is usually a politically
1926
correct term for underbid.
1927
1928
CUMMINGS: Did anybody at Lockheed ever tell you to just get on with it?
1929
1930
DE KORT: Yes, sir.
1931
1932
CUMMINGS: Is that right?
1933
1934
DE KORT: Well, everybody I talked to. I mean, my manager -- my
1935
functional manager actually told me -- and so did some other people, but
1936
they said, "You know, you're doing the right thing here, but it's going
1937
to come back to bite you."
1938
1939
CUMMINGS: Say that again? I'm sorry.
1940
1941
DE KORT: Several people, including my manager at the time, told me that
1942
I was doing the right thing, but it was going to come back to bite me.
1943
1944
CUMMINGS: So your immediate supervisor?
1945
1946
DE KORT: Yes, sir.
1947
1948
CUMMINGS: He knew you were doing the right thing, he told you.
1949
1950
DE KORT: That's what he told me, sir. Several engineers and program
1951
managers on the effort said the same thing.
1952
1953
CUMMINGS: Now, you said that you left the 123 program. Is that right?
1954
1955
DE KORT: I was removed from the program, yes.
1956
1957
CUMMINGS: And how'd that come about?
1958
1959
DE KORT: Well...
1960
1961
CUMMINGS: And when? And when?
1962
1963
DE KORT: Roughly January of February. I had sent an e-mail or letter,
1964
embedded an e-mail to at the time the acting technical director for the
1965
engineering group saying that I wanted to be removed from the project
1966
because they were going down a road that I just found intolerable.
1967
1968
However, later on I met with the V.P. of the organization, a man named
1969
Carl Banner (ph), and he told me everything would be resolved. And I
1970
said at that point, "Well, then, I would like to recall my letter to be
1971
removed. If you're going to do the right thing, then I want to be part
1972
of the right thing. I want to see this project to conclusion." But after
1973
that they removed me anyway.
1974
1975
CUMMINGS: My last question, Mr. De Kort. You understand that today
1976
you're under oath, do you not?
1977
1978
DE KORT: Yes, sir, I'm completely aware of that.
1979
1980
CUMMINGS: And you know what that means?
1981
1982
DE KORT: It means I should tell you the truth.
1983
1984
CUMMINGS: And that you are telling the truth.
1985
1986
DE KORT: Yes, sir.
1987
1988
CUMMINGS: And you understand that all kinds of agencies will probably
1989
review this transcript. Some are probably looking at this right now.
1990
1991
DE KORT: I would hope that they do.
1992
1993
CUMMINGS: And would you tell us why you've come forward? They term you a
1994
whistleblower, I guess you know that.
1995
1996
DE KORT: Well, at its essence I did not want a crew to come into harm's
1997
way down the road and to know that I could have done something about it.
1998
It's just that simple.
1999
2000
My background is Navy, State Department, counterterrorism for a while.
2001
I've been in DOD programs since I was 18 years in one capacity or
2002
another. OK? It's just real simple: I couldn't have that on my
2003
conscience.
2004
2005
CUMMINGS: Thank you very much.
2006
2007
Mr. LaTourette?
2008
2009
LATOURETTE: Thank you, Mr. Chairman.
2010
2011
And thank you all for your testimony.
2012
2013
Mr. De Kort, I made a note during the latter part of your responses to
2014
the chairman that it's your allegation that Lockheed Martin didn't do
2015
the braided, shielded cables, the low-smoke cables, the proper
2016
environmental work on the topside and 360 degree camera radius because
2017
of cost.
2018
2019
LATOURETTE: Is that your observation?
2020
2021
DE KORT: I was told we didn't do the TEMPEST cables, the shielded cables
2022
because of cost. The rest to some degree is an inference. Their response
2023
consistently was, "We're not going to slip the schedule, we're not going
2024
to have more budget issues."
2025
2026
And, to some degree, because there was a relationship with Northrop
2027
Grumman that was extremely contentious at the time -- I now refer to it
2028
as playing chicken -- they didn't want to fix the issues for any one or
2029
all of those reasons.
2030
2031
LATOURETTE: But I guess my question is this: My understanding -- and we
2032
can quibble about the exact value of the contract, but this about a $90
2033
million contract to convert these eight boats from 110s to 123s. And not
2034
being in the boat business, I would think that the big chunk of change
2035
was probably in extended the hulls by -- that's not where the big money
2036
is?
2037
2038
DE KORT: I've been told that the C4ISR proportionally was a larger part
2039
of the budget. I could be wrong, but...
2040
2041
LATOURETTE: And so let me get to that. Is it your understanding that low
2042
smoke cables were called for in the Deepwater contract that Lockheed
2043
Martin bid for?
2044
2045
DE KORT: Yes, sir.
2046
2047
LATOURETTE: But they were not installed.
2048
2049
DE KORT: Yes, sir.
2050
2051
LATOURETTE: And is it your understanding that they weren't installed
2052
because low smoke cables cost more than the cables that were installed?
2053
2054
DE KORT: Yes, sir.
2055
2056
LATOURETTE: And that the same with the braided, shielded cables?
2057
2058
DE KORT: Yes, sir.
2059
2060
LATOURETTE: And the weatherization or making sure that the antenna on
2061
the topside is the same as that?
2062
2063
DE KORT: It's more supposition because there wasn't -- I don't know
2064
which one of those four issues was the overbearing reason for the
2065
environmental issue. What I'm saying is, is in the others, somebody told
2066
me specifically cost. In that one, it was any one of the four or all
2067
four reasons.
2068
2069
LATOURETTE: OK, so just so I'm clear, it's your testimony and allegation
2070
that the reason that Lockheed Martin didn't comply with the
2071
specifications that were in the Deepwater contract is because they
2072
wanted to install cheaper stuff?
2073
2074
DE KORT: Yes, sir. That is part of it, yes.
2075
2076
LATOURETTE: OK, and you understand that they say that's not so, right?
2077
And so we're going to be stuck with a problem here sooner or later.
2078
2079
DE KORT: Well, objectively, sir...
2080
2081
LATOURETTE: Yes.
2082
2083
DE KORT: ... if you look at the equipment that they wound up delivering
2084
and the equipment that I wanted them to delivery, the equipment that I
2085
wanted them to deliver, in every case, is more expensive.
2086
2087
LATOURETTE: OK.
2088
2089
DE KORT: So I don't think it's a leap.
2090
2091
LATOURETTE: OK. But I guess I'm trying to get expensive -- they put some
2092
cables in, and you're saying that the cables that the contract called
2093
for were more expensive. Are we talking on the scale of millions of
2094
dollars?
2095
2096
DE KORT: For the external equipment, over -- understand, sir, because
2097
it's system to systems, they were leveraging designs.
2098
2099
LATOURETTE: Right.
2100
2101
DE KORT: So if very well could be millions of dollars if the -- you
2102
know, the 123 was establishing the pattern so all the rest of the
2103
systems, they were contractually directed to make them common.
2104
2105
DE KORT: So, while it appears like a small issue for the 123s,
2106
understand that it was 49 123s and every other boat that they delivered.
2107
2108
So it is millions of dollars spread out, yes, sir.
2109
2110
LATOURETTE: OK.
2111
2112
Mr. Atkinson, to you, one I want to thank you for your testimony and
2113
your charts because you truly did make the TEMPEST system understandable
2114
by people as dumb as I am. And I appreciate that. I now have an
2115
understanding. And I thought that your explanation was a good one.
2116
2117
But to you, how did you get involved in this project to the point where
2118
you wrote us 128 or 138 pages of stuff?
2119
2120
ATKINSON: Sir, I was contacted by the committee and asked to provide
2121
expert guidance as to how to query properly the Coast Guard and Lockheed
2122
Martin, because the documents which had been produced to date -- this is
2123
dating a month ago -- were not answering the questions that the
2124
committee needed answers.
2125
2126
And I was asked to assist the committee in demanding from the Coast
2127
Guard the relevant documents which the Department of Homeland Security
2128
OIG had failed to pick up on. TEMPEST is a very tricky matter. It's very
2129
easy for a defense contractor to ignore it. It's also very easy for them
2130
to conceal their ignorance of it, or their ignoring of it.
2131
2132
And I was engaged by this committee. I've donated my time to this
2133
committee to assist this committee in finding the truth and by helping
2134
the committee identify the documents that the committee needed to
2135
conduct its business.
2136
2137
LATOURETTE: Good. And I appreciate that. And I think everybody on the
2138
committee appreciates your willingness to donate and volunteer your
2139
time.
2140
2141
And I found the questions in your amendments to be -- I assume those are
2142
the questions you're talking about that people need to ask to get the
2143
answers that you think need to be answered?
2144
2145
ATKINSON: Yes, sir.
2146
2147
This committee needs to ask all of those questions on the responsible
2148
players.
2149
2150
LATOURETTE: OK.
2151
2152
Which brings me to the next part of my question, and that is the
2153
observations that you make in the first 36 or odd pages of your
2154
testimony relative to the TEMPEST tests that were performed and how they
2155
were performed, how they weren't performed properly and things of that
2156
nature.
2157
2158
But that comes about as not from an inspection of the systems on the
2159
123. That comes about as a result of your examination of the documents
2160
that were obtained from the Coast Guard?
2161
2162
ATKINSON: Yes, sir.
2163
2164
I advised the committee on what documents to demand from the Coast
2165
Guard. The Coast Guard provided some of the documents, albeit
2166
reluctantly, to this committee. I examined those documents. I found
2167
significant inconsistencies in those documents, which I brought to this
2168
committee's attention in the form of my written report.
2169
2170
LATOURETTE: Right. And I saw that.
2171
2172
But I guess my question to you is -- and I don't know what people on the
2173
next panels are going to testify, but we have three more panels of
2174
people including the Coast Guard and people from the Navy and so forth
2175
and so on.
2176
2177
Is there -- based upon your field of study, your expertise, what you do
2178
for a living -- if people come forward and testify under oath that in
2179
fact the TEMPEST tests were performed properly, and that this system
2180
passed, is there any way in your opinion that they could give such an
2181
answer?
2182
2183
ATKINSON: Could I get you to repeat the question, sir?
2184
2185
LATOURETTE: No, I don't remember the question.
2186
2187
(LAUGHTER)
2188
2189
The question is that, as I read your testimony, you came to a conclusion
2190
that there's no -- not no way -- but that this system wasn't properly
2191
tested.
2192
2193
LATOURETTE: And you go to great lengths to tell us that. I don't know
2194
who's coming next -- I know who's coming next. I don't know what they're
2195
going to say until they say it, but based upon the documents that you
2196
reviewed, is there any way that you believe someone could sit before
2197
this committee and say that this system -- these systems that were
2198
installed in the eight 123s -- could pass the TEMPEST testing system?
2199
2200
ATKINSON: I will make the answer very straightforward. If anybody comes
2201
before this committee and indicates that these ships protect national
2202
defense information, they are committing perjury.
2203
2204
LATOURETTE: OK, and that is a very straightforward answer, but let me --
2205
not to be lawyerly with you, but since I don't know the TEMPEST tests
2206
the way that you do -- and you went to great lengths to talk about how
2207
it's appropriate or proper to make the tests of the TEMPEST system.
2208
2209
I'm saying is that there -- if we have somebody that comes and says,
2210
"You know what? I tested this TEMPEST system and it meets the standard
2211
in the industry, the standard in the military," whatever the standard
2212
is, can a person make such a claim based upon the knowledge that you
2213
have today?
2214
2215
ATKINSON: No, sir. All of the documents that were provided to the
2216
committee stated, in the Coast Guard's own documents, that they failed
2217
the TEMPEST inspections and instead of correcting the deficiencies, they
2218
either ignored the deficiencies or they issued waivers to cover the
2219
deficiencies up.
2220
2221
LATOURETTE: Right.
2222
2223
And, Mr. Braden, to you, based upon -- you've installed TEMPEST systems
2224
in other programs, have you?
2225
2226
BRADEN: Yes. On the 270-foot cutters, the legacy cutters and also the
2227
design for the 210s and the 383s.
2228
2229
LATOURETTE: OK, and to Mr. De Kort's observation, did you, in the
2230
installation of those systems, have a specification that called for
2231
these braided and shielded cables?
2232
2233
BRADEN: The specification is actually a standard -- a TEMPEST standard.
2234
And as was mentioned before, I initially relied on a report from a Ms.
2235
Joe Agat (ph), who was asked to put together a list of criteria, if you
2236
will, for how a TEMPEST installation was to be done.
2237
The reason that I met with her to go over that document, although it was
2238
listed as a document for the 123s, is that some years ago, I was product
2239
manager for a line of TEMPEST terminals sold to several national
2240
security agencies.
2241
2242
And, as a result, I was familiar with TEMPEST requirements in a very
2243
detailed fashion at that time. A number of years went by and I wanted to
2244
make sure that the requirements had not changed.
2245
2246
LATOURETTE: And the requirement is braided, shielded cables?
2247
2248
BRADEN: The requirement consists of recommendations. In some cases,
2249
those recommendations give alternatives. Braided, shielded cable is the
2250
preferred alternative for ensuring security with the cabling?
2251
2252
LATOURETTE: Are you familiar with the cables that were installed on the
2253
123 conversions?
2254
2255
BRADEN: No.
2256
2257
LATOURETTE: OK.
2258
2259
Do you know what they're called, Mr. De Kort? Is it like a...
2260
2261
DE KORT: The aluminum mylar cables.
2262
2263
LATOURETTE: Aluminum mylar?
2264
2265
DE KORT: Yes, sir.
2266
2267
Mr. Braden, is an aluminum mylar cable one of the alternatives that you
2268
had? Do you know?
2269
2270
BRADEN: It could be an alternative as long as it was confirmed that the
2271
aluminum mylar was properly shielded and that it gave a full coverage
2272
under all conditions. And, as was already mentioned, aluminum mylar is
2273
not recommended because of durability issues, so it would be more
2274
appropriate in internal compartments or places where movement isn't
2275
used.
2276
2277
LATOURETTE: And let me ask you this and do you know anything about what
2278
the different is, and how much 100 feet of braided, shielded cable costs
2279
as opposed to how much the mylar aluminum cable costs?
2280
2281
BRADEN: No, I couldn't say what the price difference is. It certainly is
2282
more expensive, but I think the key issue is that it's much harder to
2283
get schedule-wise.
2284
2285
LATOURETTE: It's harder to get because of the manufacturer?
2286
2287
BRADEN: From a schedule standpoint, it is no the common, ordinary cable
2288
that you can buy at CompUSA.
2289
2290
LATOURETTE: Right. But you could buy mylar aluminum cables?
2291
2292
BRADEN: Oh, absolutely, at almost any outlet.
2293
2294
LATOURETTE: You worked for Lockheed Martin for 30 years?
2295
2296
BRADEN: Yes.
2297
2298
LATOURETTE: Have you experienced a situation where the company has made
2299
a determination on cable that has the ability to be detrimental to
2300
national security just based on how much it costs?
2301
2302
BRADEN: I've never seen that before.
2303
2304
LATOURETTE: And what about scheduling?
2305
2306
BRADEN: I've seen a lot of pressure on schedule on many programs.
2307
2308
LATOURETTE: Well, I'm sure you've seen pressures, but where a decision
2309
was made -- I mean, the allegation that Mr. De Kort I think is making,
2310
his testimony is that part of it was cost and part of it was not wanting
2311
to get behind schedule. They were going to get behind schedule on this
2312
stuff. Have you experienced the same experiences that Mr. De Kort has
2313
testified to in any of the work that you've done for the Coast Guard?
2314
2315
BRADEN: On the Deepwater program, I did experience intense pressure on
2316
both schedule and cost. As I stated in my opening statement, my project
2317
was a fixed-price contract and so there was a fair amount of scrutiny on
2318
every issue associated with cost.
2319
2320
LATOURETTE: And, last question, not to be lawyerly with you, but did
2321
that pressure on cost and schedule cause you or others that you work
2322
with to do something that you knew violated either the specs or created
2323
a situation on the TEMPEST system that was likely, as Mr. Atkinson has
2324
testified, to be vulnerable to leaking national secrets?
2325
2326
BRADEN: I didn't allow that to happen. I had a bit more oversight of my
2327
program than Mr. De Kort did, a little more independence in
2328
decision-making. And, as a result, we implemented our system totally
2329
correctly.
2330
2331
LATOURETTE: Were you ever asked to do what Mr. De Kort says he was asked
2332
to do?
2333
2334
BRADEN: No.
2335
2336
LATOURETTE: OK, thank you very much, Mr. Chairman.
2337
2338
CUMMINGS: Thank you very much.
2339
2340
As we go to Mr. Oberstar, let me just -- in fairness to Lockheed Martin
2341
and to the contract team, Mr. Atkinson, you said in the answer to a
2342
question about if someone were to say that TEMPEST certification was
2343
done here, with these votes, that they would be committing perjury. Is
2344
that what you said?
2345
2346
ATKINSON: Yes, sir.
2347
2348
CUMMINGS: Could it be that maybe they just didn't know?
2349
2350
I just want to be fair.
2351
2352
ATKINSON: Well, let me be very precise on this. In the delivery task
2353
order that the Coast Guard issued to purchase these ships, they listed
2354
only one TEMPEST specification -- one. There's a book roughly that
2355
thick.
2356
2357
It is called "Mil Handbook 232A, Red/Black Engineering." I have a copy
2358
in front of me. That was the only document that the United States Coast
2359
Guard provided to Lockheed Martin as part of the delivery order.
2360
2361
The United States Coast Guard did not ask for TEMPEST ships. They did
2362
not ask for these ships to pass classified information. I have it right
2363
in front of me, documents which this committee has in their possession,
2364
that irrefutably show these ships would not have complied with TEMPEST
2365
when they were delivered from the contract the Coast Guard gave Lockheed
2366
Martin.
2367
2368
2369
CUMMINGS: All right, thank you.
2370
Mr. Oberstar?
2371
2372
OBERSTAR: Mr. Braden, you knew Mr. De Kort during the Deepwater program?
2373
2374
BRADEN: Yes, I did.
2375
2376
OBERSTAR: Were you aware of the problems Mr. De Kort raised with 123s?
2377
And how did you come to know about those problems?
2378
2379
BRADEN: Well, I was aware of them because of the weekly integration team
2380
meetings that we had. Many of the issues on all the assets were
2381
discussed openly and presentations were given by the various lead
2382
members, and we would hear issues that were trying to be resolved across
2383
the entire program.
2384
2385
OBERSTAR: Did you discuss at length the issue of non-low smoke cabling,
2386
cameras that did not provide 360-degree coverage, problems with TEMPEST
2387
hardware?
2388
2389
And for the record, Mr. Chairman, we've been using this term, but it's
2390
telecom electronics material protected from emanating spurious
2391
transmissions.
2392
2393
We may have said that earlier, but I think we need to get that on the
2394
record, because it's a term frequently used and it has a very ominous
2395
sound to it.
2396
2397
And non-weatherproof topside equipment, did you discuss those matters?
2398
2399
BRADEN: I had occasion to speak on a couple of those matters with Mr. De
2400
Kort and that was as a result of an integration team meeting we had
2401
where I had presented the approach that we were using for the legacy
2402
cutters for our certification and accreditation.
2403
2404
I was approached after that meeting by Mr. De Kort, who quizzed me on
2405
what we were doing on those issues. We did not talk about the radios or
2406
environmental issues. We primarily talked about cabling. And TEMPEST
2407
issues was the nature of the conversation, and I related to him what we
2408
were doing on my cutters.
2409
2410
OBERSTAR: Are you aware of the cabling issue on aircraft in the 1980s
2411
and '90s where chaffing occurred in the bundles of cables on aircraft?
2412
2413
BRADEN: Yes, I've read about it.
2414
2415
OBERSTAR: Commercial, I'm talking about the commercial aircraft.
2416
2417
BRADEN: Yes.
2418
2419
OBERSTAR: You're aware of that.
2420
2421
BRADEN: Yes.
2422
2423
OBERSTAR: And it was similar, mylar aluminum, non-shielded cable.
2424
Chaffing that occurred inside aircraft resulted in wearing away of the
2425
shield, the protective mylar covering, that then resulted in sparking,
2426
with surge of very low voltage through those wires that then caused fire
2427
and caused aircraft damage and failure.
2428
2429
Are you aware of all that?
2430
2431
BRADEN: Yes. Yes, I am.
2432
2433
OBERSTAR: So you understand what the Coast Guard is doing or was doing
2434
in this case when they did not install the proper cabling, right?
2435
2436
BRADEN: I believe that the analogy you gave is appropriate in a
2437
hazardous situation. In the implementation of network cabling, in, at
2438
least for the assets that I was responsible for, all that cabling was
2439
routed through the nine areas where no hazard would occur if the cable
2440
had been chaffed. But I do understand your point.
2441
2442
OBERSTAR: But making a leap from the hazard to a different kind of
2443
hazard of leakage of signal, that's the real issue here.
2444
2445
BRADEN: Yes, I believe so.
2446
2447
OBERSTAR: And you knew about Mr. De Kort raising his concerns to
2448
Lockheed.
2449
2450
BRADEN: Well, I learned about them through his "You Tube" video, which
2451
was widely viewed by many employees, and that's where I first learned of
2452
his allegations.
2453
2454
OBERSTAR: So you said that your program, the upgrade of the 270- foot
2455
cutters, was successful.
2456
2457
BRADEN: Yes.
2458
2459
OBERSTAR: What cabling did you install there?
2460
2461
BRADEN: We installed shielded, braided cable. In some instances, we
2462
installed fiber optic cable, in instances where we went from secure
2463
compartments to compartments, and we armor jacketed that cable to
2464
prevent intrusion in non-secured locations on the ship. And we also
2465
specified low smoke, zero-allergen jackets on all the cabling.
2466
2467
OBERSTAR: And why were you able to install the more TEMPEST standard
2468
cabling on the 270 legacy cutters?
2469
2470
BRADEN: I can't say explicitly why that was, but I can say that the
2471
attention of most of the program and the management staff was attending
2472
to the 123 in terms of its schedule difficulties and, more or less, I
2473
guess I was left alone to do it right.
2474
2475
OBERSTAR: Well, why would the more secure cabling go into one class of
2476
vessel and not on the other?
2477
2478
BRADEN: I really can't answer that question. I don't know why that would
2479
be.
2480
2481
OBERSTAR: But you knew it was happening, and you saw the dangers.
2482
2483
BRADEN: Well, I had heard that it had -- it was one of the items that
2484
had been raised, but I think, as Mr. De Kort has stated, during the
2485
course of any project, there are problems. These problems are usually
2486
mitigated or removed as the course of the program goes on.
2487
2488
And my team was very, very busy meeting our aggressive schedule. I did
2489
not have time to go investigate personally whether anyone had taken
2490
action on these or not.
2491
2492
OBERSTAR: Were you asked to use aluminum mylar cable? And if you had
2493
been, would you have used it on the 270s?
2494
2495
BRADEN: Where appropriate, I would have used it, yes.
2496
2497
OBERSTAR: Now, I want to come to the testing. There are visual tests and
2498
instrument tests. And did the 270 cutters pass the visual and then
2499
subsequently the instrument test?
2500
2501
BRADEN: We passed the visual on the second cutter. The first cutter we
2502
retrofit. And the reason for that is that the cabling that we had
2503
ordered for the fiber optic connections and some of the other
2504
connections was a custom cable that was being manufactured for us by a
2505
firm in Virginia.
2506
2507
There was a hurricane that hit and pulled the roof off of that factory.
2508
That caused delays in that cable.
2509
2510
With the total agreement of the Coast Guard, we went ahead with the
2511
first installation and planned to retrofit it with the higher quality
2512
cable at a later date, which was subsequently done.
2513
2514
The visual inspection noted those discrepancies. They accepted them on
2515
the interim authority to operate. And we did replace that cable.
2516
2517
On the second cutter, we fully passed all visual inspections and then
2518
all subsequent...
2519
2520
OBERSTAR: And then subsequent, should be the instrument...
2521
2522
BRADEN: Yes.
2523
OBERSTAR: ... inspection and testing.
2524
2525
BRADEN: Yes. And I left the program before that instrumented test had
2526
been performed on the first cutter.
2527
2528
OBERSTAR: Now, the I.G. at the Department of Homeland Security has
2529
confirmed that the contractor failed to install non-low smoke cabling
2530
and failed to install topside equipment that would function in all
2531
weather conditions.
2532
2533
How could that have happened?
2534
2535
BRADEN: I really can't explain how that would have taken place.
2536
2537
OBERSTAR: Did you raise your concerns about the cable installation with
2538
Lockheed management?
2539
2540
BRADEN: I had discussed with our technical director some of the issues
2541
that had come up in the reviews regarding the 123 and I discussed them
2542
with them only in the sense that I was expressing my concern that they
2543
really needed to deal with them so that we wouldn't keep talking about
2544
them.
2545
2546
OBERSTAR: Did you feel that this rose to the level of an ethics question
2547
and did you file an ethics investigation?
2548
2549
BRADEN: I didn't feel it did at that time, no. I subsequently did file
2550
an ethics investigation concern at a later date.
2551
2552
2553
OBERSTAR: And to whom or to which level did you file that?
2554
BRADEN: The ethics office at Lockheed Martin Morristown.
2555
2556
OBERSTAR: And what action was taken subsequent to the filing of that?
2557
2558
BRADEN: I received no response.
2559
2560
OBERSTAR: Nothing.
2561
2562
BRADEN: Nothing.
2563
2564
OBERSTAR: Do you know any outcome or any action taken later?
2565
2566
BRADEN: Only supposition on my part. One of the concerns I had had to do
2567
with an employee morale program that had not been followed through with
2568
and I suggested that the ethics officer might want to contact our H.R.
2569
department to reinstate the employee award program. And about one month
2570
after that, the award program was reinstated.
2571
2572
Now, I don't know whether that was as a result of my conversation or
2573
just a normal course of...
2574
2575
OBERSTAR: To the best of your knowledge, that's the only follow- up that
2576
occurred?
2577
2578
BRADEN: That's the best guess I have, and that's it.
2579
2580
OBERSTAR: I'll have further questions later. Thank you very much.
2581
2582
CUMMINGS: Mr. LoBiondo?
2583
2584
LOBIONDO: Thank you, Mr. Chairman, very much.
2585
2586
I want to commend you for holding this hearing. I think it's absolutely
2587
imperative that we try to get to the bottom of the situation.
2588
2589
I'm hoping that we're going to hear something about the buckling hulls,
2590
and I may ask that in a couple of minutes, but I wanted to say that
2591
while I think this hearing today is very important, I think it's equally
2592
important that we not lose sight of the fact that the Coast Guard
2593
currently operates the second oldest fleet of vessels and aircraft in
2594
the world, and that was the purpose of Operation Deepwater.
2595
2596
Some of these assets are over 60 years old. They're rapidly failing.
2597
Operations tempo continues to increase. Service-wide readiness is down.
2598
Hundreds of patrol days are being lost annually.
2599
2600
And probably most importantly, the safety of the men and women of the
2601
Coast Guard who operate these assets are more in danger, I think, every
2602
day.
2603
2604
The success of the Coast Guard's many vital missions I think are in
2605
serious jeopardy.
2606
2607
As we move through this, I just hope that we can keep in sight that it
2608
is critically important that the service get these aging assets replaced
2609
with fully functioning and capable assets, and as soon as possible.
2610
2611
I would hope that we remember the videos of the Gulf hurricanes of
2612
Katrina and Rita, and the job that the Coast Guard did. And however
2613
miserably the federal government failed, no one faulted the Coast Guard.
2614
2615
And part of the ability of the Coast Guard to perform so admirably at
2616
that time was the result of the Deepwater program and the upgrade of
2617
some of the helicopters that had incredible lift capability and
2618
thousands upon thousands of lives were saved in that whole process.
2619
2620
I'm very pleased with Admiral Allen's decision yesterday. I think it was
2621
very proactive. I think it will help rein in control of this program.
2622
And it's a serious situation that needs to be fixed.
2623
2624
I have a lot of confidence in Admiral Allen. I have a very serious
2625
regret that Admiral Allen did not get his hands on the helm sooner than
2626
when he did. I'll leave it at that.
2627
2628
I would say to my colleagues that I know this situation makes it pretty
2629
easy for us to throw our hands up and to walk away from Deepwater and
2630
say that it's fatally flawed and it's got to be scrapped, but I plead
2631
with you not to turn your back on the men and women of the Coast Guard,
2632
those young men and women who are heroes every day, who are putting
2633
their lives on the line for us in so many different ways and are
2634
depending on us to come up with a solution that meets the challenges or
2635
the problems we're hearing about today, but still finds a way to give
2636
them the replacement of the assets.
2637
2638
The safety and success of their missions depend on the replacement of
2639
these assets. And it's our job to make sure that we do the best
2640
possible.
2641
2642
So, Mr. Chairman, I once again commend you and Mr. Oberstar for really
2643
getting at the heart of this problem and I hope we can get to a point
2644
where we can move forward.
2645
2646
I thank you very much. And I will later on try to ask some questions
2647
about the buckling of the hulls, when that's an appropriate time.
2648
2649
CUMMINGS: That will be good when we have the Coast Guard up.
2650
2651
Let me just say, Mr. LoBiondo, there's not one syllable, not one
2652
syllable, that you just stated that I disagree with. We all are trying
2653
to get -- make sure that the Coast Guard has equipment so that they can
2654
do the great job like they did down at Katrina and the things that they
2655
do every day, the largest seizure that they've ever had in their history
2656
just recently taking place.
2657
2658
And so this is all a part of making sure -- and I agree with you that we
2659
want them to have that equipment, but we want that equipment to be safe,
2660
and we want it to be safe for our personnel.
2661
2662
And, again, as I said a little earlier, we just want ships that float,
2663
planes that fly, just want what we contracted for.
2664
2665
Before we get to Mr. DeFazio, I just have one quick question.
2666
2667
Mr. Braden, just in follow-up to Chairman Oberstar's question, you said
2668
that -- he asked you about whether you had been asked to use -- he asked
2669
you whether you would use aluminum mylar shielded cable, and you said in
2670
certain instances.
2671
2672
Is that correct?
2673
2674
BRADEN: Yes.
2675
2676
CUMMINGS: Let me ask you these. Would you have used them in secure
2677
situations where we were trying to make sure that there was no
2678
eavesdropping, the very thing that Mr. De Kort complained about? I think
2679
that's the question.
2680
2681
If you had been asked to use that kind of cabling under the
2682
circumstances that Mr. De Kort complained about, would you have used it?
2683
2684
BRADEN: That's a difficult question to answer because the application of
2685
the cabling is also dependent on the type of compartment that you
2686
install it in and whether it's a totally shielded and contained and
2687
properly grounded compartment.
2688
2689
And what I mean by that, and I'm sure Mr. Atkinson can lend more detail
2690
to this, if I have a piece of equipment that is totally contained within
2691
a shielded enclosure and it's sharing that enclosure with other
2692
equipment of its same classification level and the same network
2693
connection, connectivity, then if that cable is properly grounded,
2694
shielded, then, yes, the mylar cable would be acceptable in that
2695
instance.
2696
2697
CUMMINGS: I see you shaking your head, Mr. Atkinson.
2698
2699
ATKINSON: Yes, sir. If you build a cabinet that contains classified
2700
equipment and the cabinet itself is TEMPEST certified, you can take an
2701
uncertified piece of equipment, put it inside this cabinet and it will
2702
provide some level of protection.
2703
2704
A very common thing is to take a printer or a plotter or a certain type
2705
of computer that there is no TEMPEST equivalent of and to encapsulate it
2706
inside of a TEMPEST box or a TEMPEST shield, which now renders it
2707
protected.
2708
2709
We can do the same thing with cables, where we can use a non- TEMPEST
2710
involved cable to hook up something that is put into a box which is
2711
itself protected.
2712
2713
And we had to be very careful what we put into this box, because some
2714
things we put in this box will cause TEMPEST hazards to occur.
2715
2716
CUMMINGS: From all the records that you've read, would you agree with
2717
Mr. De Kort?
2718
2719
ATKINSON: In what regard?
2720
2721
CUMMINGS: With regard to his complaints about the aluminum mylar
2722
shielded cable and that it should not have been used?
2723
2724
ATKINSON: Yes, sir. I have actually researched the cable that he's
2725
referring to and have found Coast Guard records in regards to them and
2726
have identified that we're talking a difference of about $20 for the
2727
cable.
2728
2729
CUMMINGS: Mr. DeFazio?
2730
2731
OBERSTAR: Would the gentleman yield before...
2732
2733
DEFAZIO: I would certainly yield.
2734
2735
OBERSTAR: I just want to reassure the gentleman from New Jersey, who has
2736
served us for a long time as the chair of the Coast Guard Subcommittee,
2737
that our purpose here is not a public hanging.
2738
2739
We're here to try to fix the underlying problems of the Coast Guard's
2740
management, of its contractual responsibilities to deliver on the
2741
program that the gentleman played a large part in authorizing for the
2742
Coast Guard, just as we have done over many years, and when I chaired
2743
the Aviation Subcommittee and the Investigations and Oversight
2744
Subcommittee, to get FAA on the right track, learn how to manage
2745
multi-billion dollar contracts and then fund those programs.
2746
2747
I assure the gentleman that is the purpose of this hearing, is to go to
2748
the core of the problems uncovered here, fix them and then report out a
2749
robust Coast Guard authorization program so they can fix those old ships
2750
and have the equipment they need to carry out the many responsibilities
2751
we've loaded upon them.
2752
2753
I yield.
2754
2755
LOBIONDO: Through the chairman, would the gentleman yield for
2756
reauthorization minute?
2757
2758
Mr. Oberstar, I applaud your efforts. I in no way meant to intimate that
2759
that was the case.
2760
2761
But my concern was from some other colleagues who were not on the
2762
committee who have just, in casual conversation, said to me, "We ought
2763
to just scrap the program." And I don't think they understand what
2764
scrapping the program would mean.
2765
2766
OBERSTAR: I just want to reassure the gentleman we are on the same...
2767
2768
LOBIONDO: OK. We're in synchronization. Thank you, Mr. Oberstar.
2769
2770
DEFAZIO: And I would certainly second those comments. Ten years ago, as
2771
the ranking member on the Coast Guard subcommittee, I became very well
2772
aware of and was a strong advocate for increased funding and new
2773
equipment for the Coast Guard. I had one of the antique ships in the
2774
Coast Guard serving my district for a while, and I'm well aware of that
2775
problem.
2776
2777
But it was only after 9/11 that Congress and this administration began
2778
to recognize the need.
2779
2780
And Katrina certainly highlighted the efficiency and valor of the Coast
2781
Guard. And none of that's in question here today. But there are
2782
extraordinary questions about how we got to this point.
2783
2784
And I guess I'm going to direct most of my questions to Mr. Sampson. And
2785
I will be questioning the buckling and the design on the 123s, which the
2786
former chairman hoped we'd get to. I've been waiting to get to it, too.
2787
I'm not much of an electronics guy, but I am and have been a lifelong
2788
sailor and boat owner.
2789
2790
Mr. Sampson, these will be directed to you, but just keep this in mind
2791
as I ask you the questions. This is a statement that will come after you
2792
have left and I want to give you an opportunity to sort of respond to it
2793
in your responses to me.
2794
Mr. James Anton, vice president, Deepwater Program, Northrop Grumman
2795
Ship Systems, and if you look at page two of his testimony, he says,
2796
"HBJV added a 13-foot extension to the 110, which was similar to the
2797
9-foot extension they had successfully added to the Cyclone patrol boats
2798
starting in 2000." Note, no mention there of the early problems with
2799
those extensions, but he does say they were successful.
2800
2801
He goes on further on that page to talk about hull deterioration. He
2802
goes on, page three, to talk about the ships being operated in seas
2803
beyond their design capacity.
2804
2805
He goes on, on page four, to say that an outside engineering forum,
2806
designers and planners engaged by the Coast Guard, analysis showed the
2807
overall hull structure design was adequate under all expected operating
2808
conditions up to the worst operating condition modeled.
2809
2810
And then, in summary, he says, "It's premature to speculate on the final
2811
cost and final way forward."
2812
2813
I assume you probably don't agree too much with that analysis or those
2814
remarks.
2815
2816
SAMPSON: No, sir, I don't. There's several different perspectives that
2817
I'd like to address. I haven't had the opportunity to read the comment
2818
that you're discussing.
2819
2820
I wrote down some quick notes. So if there's something there that I
2821
missed, please remind me and I'll feel free to discuss.
2822
2823
In regards to the Navy's experience with the PCs, I want to make sure
2824
it's very clear. CCD Combatant Craft emphasized to the Coast Guard, as
2825
well as Bollinger Shipyard, because this was kind of a misconception
2826
among many, that Bollinger Shipyard built the 110, they built the 170,
2827
they did the extension.
2828
2829
What never appears to come to the surface is the fact that Combatant
2830
Craft Division was the one that did the entire design work for the
2831
extension. The failures that occurred were actually prior to when the
2832
170s were first built. When the PCs were first delivered, they started
2833
failing immediately.
2834
2835
That was a function of -- after extensive investigation, Combatant Craft
2836
came to the position that the 1997 ABS rules, high- speed craft rules
2837
which the PCs were built to, had under-predicted what they call a
2838
dynamic loading condition.
2839
2840
The ABS later, in their high-speed naval craft code, did correct this
2841
based on that experience. It was a known issue to ABS, to Combatant
2842
Craft, and we made that very clear to Bollinger Shipyard.
2843
2844
DEFAZIO: Is that what you discussed with Mr. Debu Ghosh on 9/3/02?
2845
2846
SAMPSON: That was one of the topics, yes, sir.
2847
2848
DEFAZIO: OK, go ahead.
2849
2850
SAMPSON: The Combatant Craft, when they did the design work, Bollinger
2851
is a great fabricator. However, they did not facilitate the engineering,
2852
production detail, things of that nature, but the actual first extension
2853
was not performed by Bollinger, to my understanding. It was actually by
2854
another shipyard.
2855
2856
So they did not perform the engineering. That expertise resided with
2857
CCD. During that 9/3 meeting with Mr. Ghosh, we emphasized to him that
2858
this was not a simple evolution, that the design was very complex. The
2859
PC went from a 5 percent length increase of nine feet as compared to the
2860
123 or the 110, which added 13 feet, to 12 percent increase. This is a
2861
substantial, substantial increase in length.
2862
2863
As a result of that, the rules that were being used or we were told were
2864
being used for the 110 and 123 conversion were these what CCD felt were
2865
flawed rules of ABS, the 1997 high-speed craft code.
2866
2867
DEFAZIO: So that was probably the point at which -- that you, the Navy,
2868
CCD offered to provide some design and engineering support to Bollinger,
2869
Northrop Grumman or the Coast Guard on the conversion.
2870
2871
SAMPSON: Yes, sir. Let me make it clear. CCD did not go out and
2872
necessarily try -- Combatant Craft is a capital funded program. So in
2873
essence, we're like a contractor. We have to go out and sell our
2874
services.
2875
2876
DEFAZIO: Right.
2877
2878
SAMPSON: So I can't voluntarily.
2879
2880
DEFAZIO: But you made an offer that...
2881
2882
SAMPSON: We informed the parties involved, yes, sir.
2883
2884
DEFAZIO: And I believe it was not particularly spendy in terms of how
2885
much money's been wasted here. What would the cost have been?
2886
2887
SAMPSON: Just for oversight to determine if a problem existed would have
2888
been $42,000.
2889
2890
DEFAZIO: $42,000.
2891
2892
SAMPSON: Yes, sir.
2893
2894
DEFAZIO: And how much did we spend per ship conversion?
2895
2896
SAMPSON: A lot more than that, sir. I'm not aware of the exact number.
2897
2898
DEFAZIO: OK. But that offer was declined.
2899
2900
SAMPSON: Yes, sir.
2901
2902
DEFAZIO: OK. And was there any particular reason given for declining
2903
that offer?
2904
SAMPSON: No, sir.
2905
2906
DEFAZIO: OK. Then you went to the Coast Guard.
2907
2908
SAMPSON: The order that we talked, we had talked with Mr. Ghosh first.
2909
2910
DEFAZIO: Right.
2911
2912
SAMPSON: Then I had talked to the Deepwater program office up in
2913
Washington, D.C., talked to Ms. Diane Burton and another gentleman that,
2914
for the life of me, I can't remember his name, but I remember him as a
2915
program manager. I don't recall if he was specific to the 123 or in
2916
total.
2917
2918
Explained the situation to them. Ms. Burton, being a former NAVSEA
2919
employee, I think understood some of our concerns. However, the
2920
discussion was very short and thank you very much, and we never heard
2921
anything further from them.
2922
2923
Northrop Grumman, Combatant Craft did not contact directly. However,
2924
Bill Moss, who is our point of contact for the Cardarock division, did
2925
provide a capabilities brief to Northrop Grumman to explain what the
2926
Navy had to offer them specific to the 123. Nothing was mentioned.
2927
2928
DEFAZIO: So do you think that there's any possibility that Mr. Anton,
2929
who raises the other issues, was aware of these concerns as a Northrop
2930
Grumman executive?
2931
2932
SAMPSON: I have no idea, sir.
2933
2934
DEFAZIO: Perhaps he'll be asked that on the next panel under oath and
2935
why action wasn't taken.
2936
2937
I've got to jump ahead here because the time is valuable and we've been
2938
holding people a long time.
2939
2940
This is, I think, a critical question because there was some concern
2941
raised earlier by Mr. Mica that we're just plowing old ground and that,
2942
in fact, this has all come out before.
2943
2944
But did Mr. Carl Cassamassina (ph) of Navy CCD warn the Coast Guard that
2945
it was in danger of losing a ship if the hull cracking problem was not
2946
corrected?
2947
2948
SAMPSON: I don't have firsthand knowledge of that specific conversation
2949
where those words were used. I do, however, know that Mr. Cassamassina
2950
(ph) and myself talked at length to the Coast Guard and Bollinger and
2951
explained the severity of the situation, and we felt confident that they
2952
understood that.
2953
2954
DEFAZIO: That apparently was -- the Navy did give us that statement,
2955
that they afforded that warning, but I thought you had knowledge of it.
2956
2957
You had conversations...
2958
2959
SAMPSON: Not that particular phone call.
2960
2961
DEFAZIO: ... similar to that with Mr. Cassamassina (ph).
2962
2963
SAMPSON: Yes, sir.
2964
2965
DEFAZIO: So the risk here was catastrophic failure, hull failure, loss
2966
of the ship, potentially loss of life.
2967
2968
SAMPSON: Potentially, yes, sir.
2969
2970
DEFAZIO: And then, finally, it's our understanding the Coast Guard made
2971
two efforts to fix the 123s after the problems with the deck -- that the
2972
decks appeared. Did the Coast Guard consult with CCD on these proposed
2973
fixes, that you're aware of?
2974
2975
SAMPSON: I, as employed by the Coast Guard, did consult with CCD, but
2976
purely on a professional peer level.
2977
2978
DEFAZIO: Right.
2979
2980
SAMPSON: Having worked with them, I consulted them and asked them their
2981
thoughts or to confirm what I was suspecting or believing, which they
2982
provided to me as a personal interest that, yes, these fixes were not
2983
going to work.
2984
2985
SAMPSON: However, there was no direct involvement, to my knowledge,
2986
between CCD and...
2987
2988
DEFAZIO: Did you report that up the chain that these proposed fixes were
2989
not likely to work, according to your consultation with CCD?
2990
2991
SAMPSON: Absolutely. My command, the Maintenance and Logistics Command
2992
Atlantic, voiced those concerns repeatedly.
2993
2994
DEFAZIO: But they went ahead anyway.
2995
2996
SAMPSON: Yes, sir.
2997
2998
DEFAZIO: And they didn't work.
2999
3000
SAMPSON: Correct.
3001
3002
DEFAZIO: Well, so none of the efforts to fix the 123s succeeded. And
3003
would you then think that -- you would disagree with Mr. Anton's
3004
statement that it's premature to speculate on the final cause and the
3005
way forward -- of the failure.
3006
3007
You think we know the cause.
3008
3009
SAMPSON: I think there's a strong case to be made that the cause is due
3010
to the hull strength of the hull girder issue.
3011
3012
The localized failures that have occurred on deck and some other places
3013
were, in my opinion, a result of the modifications, where they just
3014
moved stress from one location to another.
3015
3016
The actual initial failure of the Matagorda was a clear classical
3017
failure due to bending.
3018
3019
DEFAZIO: Mr. Chairman, I want to thank you for the generous grant of
3020
time and for your leadership on this issue.
3021
3022
I do want to say, in closing, that Mr. De Kort, in his testimony, said
3023
that -- and he was referring to a number of things here -- that these
3024
were actually informed and deliberate acts.
3025
3026
And I hope if, through our investigation, we find that any of these acts
3027
were informed and deliberate, that both defrauded the taxpayers and
3028
jeopardized national security and potentially jeopardized health and
3029
safety of our Coast Guard crews, that we will be providing all of that
3030
to the Justice Department in the hope that maybe some of those
3031
responsible could enjoy federal hospitality.
3032
3033
CUMMINGS: Thank you very much.
3034
3035
I take it, Mr. Sampson, that you did not believe -- I've seen the ships.
3036
I saw them last Thursday and I can tell you they're a mess.
3037
3038
SAMPSON: Yes, sir.
3039
3040
CUMMINGS: Have you seen them?
3041
3042
SAMPSON: Yes, sir. I've done extensive investigations and inspections on
3043
those craft.
3044
3045
CUMMINGS: And the amazing thing is that I thought we were talking about
3046
a big ship. Some of these boats are not as big as some yachts.
3047
3048
SAMPSON: Yes, sir.
3049
3050
CUMMINGS: I mean, it's incredible. And it so happened to be in
3051
Baltimore, where I live, it so happened to be there, and I wanted to go
3052
see them. But anyway.
3053
3054
Mr. Gilchrest?
3055
3056
GILCHREST: Thank you very much, Mr. Chairman.
3057
3058
I, too, want to make sure that that Coasty who is today similar to Gene
3059
Taylor 30 years ago, whether they're breaking ice to McMurdo -- maybe 10
3060
years, I don't know when Gene Taylor was in the Coast Guard.
3061
3062
When those Coastys are breaking ice to McMurdo Station in the Antarctic,
3063
on that ship, when they're at Cape Disappointment rescuing people, when
3064
they're in the Gulf of Alaska because a crab boat is in trouble, or the
3065
Chesapeake Bay, or these guys are out there determining international
3066
standards at the IMO in London, it's an extraordinary service.
3067
3068
But I do remember a time 40 years ago when I was using an M-14 in
3069
Vietnam, worked every time we pulled the trigger. Sadly, we had to pull
3070
the trigger occasionally. Rain, monsoons, heat, mud, dust, you name it.
3071
3072
We were given an M-16 about February of 1967, and it didn't work. Who
3073
was responsible for that? In 1967, these young men, like we have now in
3074
Iraq and Afghanistan, assume the chain of command is competent.
3075
3076
Well, we're here to praise the stunning abilities of the Coast Guard
3077
people. And we also want to find out the chain of command, that whoever
3078
and wherever it is, that changed the basic physics, they changed the
3079
physics of the boat when they wanted to put in some add- ons which would
3080
have made it more serviceable under certain conditions, but they changed
3081
the physics of the boat.
3082
3083
So who was responsible for approving that change up the chain of
3084
command, including everybody and the contractors?
3085
3086
So I guess -- and we're not here -- I'm glad the chairman is holding
3087
this hearing. We're not here to unfairly reprimand anybody, but we'd
3088
like to know how this came about, that we have eight boats now that
3089
don't work.
3090
3091
Mr. Sampson, did the Coast Guard consult with the Navy engineers when
3092
reviewing the proposed design of the 110-foot patrol boat conversion?
3093
3094
SAMPSON: No, sir, they didn't necessarily consult us. We, as CCD, did
3095
notify them of our experience with the PC and the lessons learned, and
3096
we shared that with the Coast Guard voluntarily.
3097
3098
GILCHREST: So there was a basic consultation that took place.
3099
3100
SAMPSON: Yes, sir, on that 3rd of September with Mr. Ghosh, in addition
3101
to the Deepwater program office, we shared that we had extensive
3102
knowledge and experience with this type of design and modification and
3103
that they were at very high risk of failure if they were to proceed.
3104
3105
GILCHREST: So what were the specific concerns that would cause the high
3106
rates of failure if they proceeded?
3107
3108
SAMPSON: As I stated earlier, sir, that ABS 1997 high-speed craft rules,
3109
it uses two methods of prediction for the strength of the boat. One is a
3110
static loading and one is a dynamic loading.
3111
3112
That 1997 rules under-predicted the dynamic loading. As a result, the
3113
static was the driving factor, according to that rule set. Combatant
3114
Craft, through investigation, realized that that was actually not the
3115
case and they used another classification society's rules in conjunction
3116
with some additional calculations to determine the actual correct
3117
strength that the vessel had to be.
3118
3119
Because of that, we cautioned the Coast Guard extensively, because we
3120
knew they were going to use the old set of ABS rules.
3121
3122
GILCHREST: Did they take your caution seriously?
3123
3124
SAMPSON: We felt that they understood our concerns. I do not know what
3125
they did with our information.
3126
3127
Mr. Ghosh certainly tried to -- I think understood and he tried to hire
3128
us to provide...
3129
3130
GILCHREST: So you don't know if those recommendations were followed
3131
through by anybody in the Coast Guard.
3132
3133
SAMPSON: Eventually, they weren't, sir, because the boats were built as
3134
proposed. We also shared, real quick, sir, that when you lengthen a
3135
boat, those bending moments, that static bending and dynamic loading,
3136
those are affected primarily by the length of the vessel and the dynamic
3137
also has a speed component. But the length of the vessel is a
3138
significant contributor to that bending force.
3139
So when you lengthen a boat by 12 percent, that's a tremendous length
3140
increase for that size craft and so you have to add strength to the
3141
vessel.
3142
3143
Vessels that are high-speed craft, such as the 110...
3144
3145
GILCHREST: So strength was not added to the vessel.
3146
3147
SAMPSON: No, sir, not at all.
3148
3149
GILCHREST: Can you just tell us -- I know my time is up -- why wasn't
3150
strength added to the vessel if those recommendations were made?
3151
3152
SAMPSON: The only thing that I can speculate, sir, is that the static
3153
condition was a driving factor and they felt they complied with that
3154
static condition. Other than that, I have no idea, sir.
3155
3156
GILCHREST: I see. Well, thank you very much.
3157
3158
Thank you, Mr. Chairman.
3159
3160
CUMMINGS: Thank you.
3161
3162
Mr. Taylor?
3163
3164
TAYLOR: Thank you, Mr. Chairman.
3165
3166
Mr. Sampson, I want to follow-up on what you were just touching on,
3167
because I've heard now three different explanations for the 110
3168
problems.
3169
3170
First, I was told they never did hogging and sagging calculations. Then
3171
I was told, "Yeah, we did them, but we didn't figure in fatigue." "Yeah,
3172
we figured in fatigue, but we misjudged the steel."
3173
3174
Apparently, the initial hull had some high tensile steel, apparently got
3175
a "Made in USA" waiver. I'm told it was from England, but I'm told no
3176
one ever tested it on the initial building of the hull and that, like
3177
you said, when the hull's only 110 feet and you're stretched between two
3178
waves, you didn't have the hogging and sagging problem, you make it 123
3179
feet, get between two waves, you have substantial problems.
3180
3181
My question to you is, since I'm getting so many different stories from
3182
people who ought to hopefully be telling me the truth and since we've
3183
now got eight ruined ships, $40 million down the drain, to my knowledge,
3184
no one's been fired. To my knowledge, no one has claimed responsibility.
3185
3186
I can assure you if this had happened in the private sector, a bunch of
3187
people would have been fired by now.
3188
3189
So what do you think happened?
3190
3191
SAMPSON: Sir, you bring up some good points.
3192
3193
TAYLOR: And I also want to say, Mr. Cummings, if you owned a crew boat,
3194
a boat that takes people out to an offshore oil rig, and you wanted to
3195
stretch that crew boat and still have it certified to carry passengers,
3196
the Coast Guard would have run the test before they ever recertified
3197
that vessel again.
3198
3199
So it's absolutely crazy that something they do every day in judging the
3200
private sector, they apparently didn't do for themselves. And no one's
3201
ever answered that question.
3202
3203
SAMPSON: Sir, I think to clarify, I think there are some issues there
3204
that may have been crossed over. The metal fatigue and the material
3205
properties were things that were subsequently looked at, well after the
3206
Matagorda failed.
3207
3208
Those were things that were addressed after the fixes did not work in
3209
the hopes to try to figure out exactly what transpired.
3210
3211
TAYLOR: To the point, I was told they never looked at metal fatigue in
3212
the beginning when they were running the hogging and sagging
3213
calculations. Is that true?
3214
3215
SAMPSON: That I'm not aware of, but I would suspect that's the case.
3216
3217
TAYLOR: Did they run hogging and sagging calculations up front, just
3218
like they would have if a crew boat operator had gone to them wanting to
3219
stretch their vessel?
3220
3221
SAMPSON: Mr. Ghosh would probably be the best one to answer that, sir.
3222
My understanding is they did and there were some errors in those
3223
calculations, but he would give you a definitive answer on that, sir.
3224
3225
TAYLOR: Did anyone ever test the steel that I'm told came from England,
3226
which probably would have required a "Made in USA" waiver, and that if
3227
we did that, we undoubtedly paid a premium for it in the first place, to
3228
see whether or not it was up to the spec that we probably paid the
3229
premium for?
3230
3231
SAMPSON: To my understanding, no steel was imported from England. The
3232
initial design, both the 110s and the 170s, all those craft were
3233
designed by a British company called Vosper Thornycroft.
3234
3235
They had a material requirement in their design of what they called
3236
British steel 4360. It's a British standard saying this is the material
3237
properties.
3238
3239
It's my understanding, and Bollinger may be able to correct this, but
3240
it's my understanding that they had specifically mill runs performed by
3241
U.S. steel mills and all that material made to that British standard and
3242
delivered to Bollinger Shipyard for construction of the 110.
3243
3244
Whether or not they had any material testing done at that time, I'm not
3245
aware of.
3246
3247
TAYLOR: So to the point, what do you think happened? Since I'm game now
3248
for the fourth opinion of why these ships failed, and yet no one's
3249
responsible.
3250
3251
SAMPSON: Sir, I think there's a combination of things, but I believe
3252
that the longitudinal bending, the -- in real simple terms, and I'll try
3253
to make this brief, when you take a hull and you put it in the water, it
3254
has to be designed to handle, to go through waves and over waves.
3255
3256
TAYLOR: Mr. Sampson, I have stretched these boats. So I'm familiar with
3257
all that.
3258
3259
SAMPSON: You have to design for both of those loading conditions. The
3260
loading conditions that were initially assessed by the 1997 ABS rules
3261
under-predicted those loads that the boat would have to meet.
3262
3263
It may have been, I do not know, Mr. Ghosh may be able to provide the
3264
information, but we understood, as Combatant Craft, that those rules
3265
were faulty.
3266
3267
We did our own simplified investigation to determine that the loadings
3268
would have been much more significant to require to provide strength of
3269
that hull sufficient enough to withstand the operations.
3270
3271
There were other issues later on where the specification, the
3272
performance specification came into question. I've read the performance
3273
specification that was issued. To me, it's very clear that the intent
3274
was to have a platform that was as capable as the 110 WPB at the end of
3275
the conversion.
3276
3277
That did not happen, obviously. At all the times of the failures of the
3278
123s, we had 110s out and operating that suffered no hull damage
3279
whatsoever.
3280
3281
TAYLOR: So for the record, who did you notify?
3282
3283
SAMPSON: I notified ELC, Mr. Debu Ghosh. I notified the Deepwater
3284
program office, Ms. Diane Burton and another gentleman who I cannot
3285
remember his name. Notified Bollinger Shipyard, Dennis Funge (ph), and
3286
anybody else who would listen.
3287
3288
3289
But those were the three primary contacts that we notified.
3290
TAYLOR: And for the record, did any of them change their plans in any
3291
way or did any of them recalculate the test to see if -- to address your
3292
concerns?
3293
3294
SAMPSON: At the time, sir, I was with CCD. The Coast Guard -- I was not
3295
intimate with the Coast Guard. I do not know what they did. Mr. Ghosh
3296
took the matter very seriously. I'm not sure what he did.
3297
3298
TAYLOR: Thank you, Mr. Chairman.
3299
3300
CUMMINGS: Before we get to Mr. Diaz-Balart, let me just ask you one
3301
question. I'd direct this to Mr. Braden and to Mr. Sampson.
3302
3303
Yesterday, the Coast Guard announced its intention to bring the systems
3304
integration function back in-house. How do you think this changed
3305
process will help?
3306
3307
Do you think it'll help at all? Do you think we'll still be in the same
3308
-- still have the same kind of problems?
3309
3310
And I'm following-up on what Mr. Taylor just talked about. It seems like
3311
we've -- nobody's been fired, to my knowledge either. And it seems like
3312
this is a situation that all parties involved have some responsibility
3313
in some issues. But I'm just wondering, he's made this announcement
3314
apparently in an effort to try to cure the situation and make it better
3315
for the future.
3316
3317
And I was just wondering what your -- are you familiar with that?
3318
3319
BRADEN: Yes, I am.
3320
3321
CUMMINGS: Mr. Braden, do you have an opinion on that?
3322
3323
BRADEN: Well, I feel, and I think this was mentioned previously, that
3324
the Coast Guard is ill prepared at this time to provide quality system
3325
engineering and integration oversight.
3326
3327
I have heard from the members that there are efforts to beef up their
3328
staff, to hire the necessary people. I think that's going to be a major
3329
challenge for them to do that.
3330
3331
I think they will still need to rely heavily on industry to provide that
3332
guidance. I believe personally that oversight, meaning an independent
3333
assessment of what the requirements have been agreed to, is the biggest
3334
key to success on the program.
3335
3336
In the past, as a performance-based requirement, there was a good bit of
3337
subjectivity as to how you achieve the final performance goal. And that
3338
subjectivity was, I would say, a major point of contention between the
3339
Coast Guard and, in my direct experience on the 270s, and ourselves in
3340
terms of debating, probably needlessly and sometimes seemingly
3341
endlessly, as to someone's interpretation.
3342
3343
And I think by getting clear requirements and then having oversight of
3344
those requirements, that would go a long way towards making sure that
3345
things got done exactly right the first time.
3346
3347
CUMMINGS: It sounds like, Mr. Braden, that you were very strong with
3348
regard to your standards and you were not going to bend, no pun
3349
intended. But you were not going to bend. And it sounds like, to me, you
3350
-- basically, they kind of let you alone and you did what you had to do
3351
and apparently, as we see now, it worked out fine.
3352
3353
That's what it sounds like now.
3354
3355
BRADEN: Well, I'll echo what I have heard previously, too, and that is
3356
that I have the utmost respect for the people who put their lives on the
3357
line daily in the Coast Guard. And it was my intention to be certain
3358
that we delivered the best quality systems we possibly could.
3359
3360
And I found that in some instances, I saw, in other areas of the
3361
program, sort of an adversarial relationship between the Coast Guard and
3362
the contractors. I tried to nurture a friendly, cooperative, open
3363
discussion and that is how we did finally nail down some of the tough
3364
issues we had to contend with in terms of interpretation.
3365
3366
CUMMINGS: Mr. De Kort, same question.
3367
3368
DE KORT: We had a different experience, Mr. Braden and I. If I'd have
3369
had the ability to be that independent and to have that relative
3370
authority, we would not be talking right now.
3371
3372
CUMMINGS: Mr. Sampson?
3373
3374
SAMPSON: Sir, I guess my...
3375
3376
CUMMINGS: You have a unique perspective, Mr. Sampson. You had the Navy
3377
and the Coast Guard experience.
3378
3379
SAMPSON: Yes, sir.
3380
3381
CUMMINGS: And what we've been hearing is that the Navy is well equipped
3382
to do a lot of these things and maybe the Coast Guard isn't there yet.
3383
3384
But you go ahead. I'm listening.
3385
3386
SAMPSON: I love the Coast Guard, sir, through and through.
3387
3388
CUMMINGS: We do, too.
3389
3390
SAMPSON: It's the best organization out there. I think the Coast Guard's
3391
-- one of the more trying aspects that the Coast Guard has is resources.
3392
3393
If you look at the Navy, it's a huge organization, lots of money, lots
3394
of human capital to take care of many of the challenges that are put
3395
before them.
3396
3397
With the Coast Guard, this is Scott Sampson's personal opinion, but the
3398
Coast Guard, we are asked to do more and more and more. I had to give up
3399
billets out of the section that I supervised to provide people for
3400
(inaudible), the 110s that we have overseas supporting our men and women
3401
over there. I had to give up a lieutenant JG for an admiral's billet
3402
that doesn't get replaced.
3403
3404
We're continually asked to do more and more. I have a friend of mine
3405
who's in the acquisition office that puts in routinely 12 to 14 hour
3406
days, including weekends, and he doesn't get to see his wife much,
3407
because we ask more and more of our folks and we're never provided or
3408
very rarely are we provided the resources to try to get those tasks
3409
accomplished.
3410
3411
And while I have the utmost in confidence in the commandant's direction
3412
and leadership, I think this is going to be a significant challenge for
3413
the Coast Guard to provide that additional oversight that's going to be
3414
placed upon us.
3415
3416
CUMMINGS: Thank you very much.
3417
3418
Mr. Diaz-Balart?
3419
3420
DIAZ-BALART: Thank you, Mr. Chairman. I actually really don't have a
3421
question, but more just a couple of comments.
3422
3423
First, I want to thank you, Mr. Chairman, for what I think has been a
3424
very important hearing. And I want to thank, also, those of you who have
3425
come forward for spending all this time with us and I think it's been
3426
very helpful to allow us to understand a little bit what the issue is.
3427
3428
Secondly, when I was listening to Mr. Taylor, I shared his concern and
3429
his frustration. The fact that what he said, and I'm paraphrasing, Mr.
3430
Taylor, but about the fact that nobody's been fired. I've obviously been
3431
surprised, Mr. Taylor and I, that in the public sector, it's very hard
3432
to fire people anyways, which is one of the problems with creating
3433
larger bureaucracies is that you never can get rid of them.
3434
3435
But it's clearly frustrating for him and for me, and I don't think it
3436
should surprise us.
3437
3438
Number three is that I think it's very important -- and you all have not
3439
done that, so I'm not -- but it's very important that anybody listening
3440
doesn't -- when we speak about the Coast Guard or Lockheed Martin, it's
3441
not the Coast Guard of Lockheed Martin.
3442
3443
There may be some individuals that have made mistakes and that's not the
3444
entity, the entirety entity, and I just -- you all understand that. We
3445
understand that. I just want to make sure that everybody else
3446
understands that.
3447
3448
DIAZ-BALART: And, lastly, Mr. Chairman, I just want to thank you and,
3449
also, Chairman Oberstar for your statements to Mr. LoBiondo's question
3450
or comments, and your commitment to that, because as Mr. Sampson just
3451
stated, the Coast Guard has always been underfunded, which is why this
3452
project, this Deepwater project is so important.
3453
3454
But obviously it's important not only that it receive the funding, but
3455
that it's funded and the money's spent efficiently and effectively, and
3456
that's the purpose.
3457
3458
I want to thank both you gentlemen for clarifying that, again, nothing
3459
that we didn't expect to hear from you, but it's always, I think,
3460
important that we thank you for that strong statement of support for an
3461
efficient, effective Deepwater program that does protect our national
3462
interest, our national security, and obviously the men and women who...
3463
3464
(UNKNOWN): Would the gentleman yield just briefly?
3465
3466
DIAZ-BALART: Yes.
3467
3468
(UNKNOWN): For an observation. I've served on the Coast Guard
3469
subcommittee since I came to Congress 32 years ago. We have added 27 new
3470
functions to the Coast Guard in those years, but the Congress and
3471
administrations, Democrat or Republican, have not given the Coast Guard
3472
the funding they need to carry out those functions.
3473
3474
That's what I'm talking about. That's the frustration and, by damn,
3475
we're going to work on that and do that in this Congress.
3476
3477
DIAZ-BALART: And I thank the chairman. Reclaiming my time. I thank the
3478
chairman for that, for his commitment. I know that.
3479
3480
I've been in conference with you not that many years, obviously, and
3481
I've seen that commitment. Clearly, the Coast Guard deserves the
3482
funding.
3483
3484
I think one of the problems that I am seeing here from Mr. Sampson's
3485
statement, and, again, I don't want to paraphrase, I'm paraphrasing what
3486
you said, but one of the issues that may be unfolding here is that, yes,
3487
frankly, with this Deepwater program, we've finally funded some assets
3488
for the Coast Guard that, frankly, since probably the Coast Guard has
3489
been so underfunded for so many years, they just weren't ready for it
3490
and no excuse there.
3491
3492
But anyways, I just wanted to make those statements. I want to thank the
3493
chairman of the subcommittee and the chairman of the full committee for
3494
allowing us this opportunity. I think it's been very fruitful.
3495
3496
Thank you.
3497
3498
(UNKNOWN): Will the gentleman yield to me on your time?
3499
3500
DIAZ-BALART: Yes, sir, I give you the rest of my time.
3501
3502
(UNKNOWN): Thank you very much. I just wanted to, so I don't have to
3503
drag out this panel, Mr. Atkinson, could you clarify your $20 remark?
3504
Because I had asked Mr. De Kort and Mr. Braden about it and I thought I
3505
heard you say, and I don't want to put words in your mouth, but the
3506
difference between the mylar aluminum and the braided, shielded was 20
3507
bucks.
3508
3509
Is that 20 bucks a foot, 20 bucks a mile?
3510
3511
ATKINSON: No, sir. The Coast Guard -- excuse me. ICGS purchased the
3512
cable made by a company called Cable General. This was an Ethernet cable
3513
similar to what many of you have in your offices, but it's a heavier
3514
duty version of that cable.
3515
3516
Now, this cable is made in two formats. It's called a ship LAN cable
3517
designed for local area networks aboard ships. The first version is an
3518
unshielded twisted pair with a mylar shield only.
3519
3520
There is also another version, which is only slightly more expensive,
3521
which is a double shielded braid and foil. On the ends of this cable is
3522
a connector made by Sentinel Connector Company or Sentinel Connector
3523
Systems, Inc., which the actual connector itself was developed by
3524
Lockheed Martin.
3525
3526
The price difference between the shielded cable and the mylar shielded
3527
cable ore the double shielded cable, if you will, and the mylar shielded
3528
cable, total cost for a 10-foot cable, that mylar shielded, is about
3529
$7.50. The cable that is double shielded is roughly $27.
3530
3531
(UNKNOWN): For 10 feet.
3532
3533
ATKINSON: For a 10-foot cable.
3534
3535
(UNKNOWN): Anybody have any idea how many feet of cable we're talking
3536
about in the 110 conversions, Mr. De Kort?
3537
3538
DE KORT: There are almost 400 cables in total. I don't know how many
3539
there are, but I'd imagine several dozen, but, again, sir, that would
3540
need to be multiplied times 49 times the rest of the vessels, because
3541
it's a system of systems.
3542
3543
And if I could, because I understand why you're going to down, if I
3544
could clarify really quickly. When you have a program where you bid $4
3545
million per boat and you know you're overrunning double that and it's $8
3546
million per boat, it's very possible that they thought their potential
3547
profit was literally in five cents per cable.
3548
And, also, though, by the time these issues had snowballed, I believe
3549
Lockheed Martin, part of their thought was this is embarrassing. So at
3550
some point, they just didn't want this to come out because of how
3551
avoidable it was and how crucial these issues were.
3552
3553
So it's the combination, sir, of the cost, schedule, as well as not
3554
wanting to necessarily come out.
3555
3556
(UNKNOWN): And I thank you, Mr. Diaz-Balart, for yielding. Thank you.
3557
3558
CUMMINGS: Mr. Hall?
3559
3560
HALL: Thank you, Mr. Chairman and Chairman Oberstar. Thank you for the
3561
patience of all our witnesses and our other witnesses. I'll keep this
3562
really brief.
3563
3564
3565
Mr. Sampson, I gather you're, among other things, a naval architect.
3566
SAMPSON: Yes, sir, that's correct.
3567
3568
HALL: And when one builds a 110-foot vessel or any vessel, I would guess
3569
that the naval architect tries to make it of the ideal proportions to
3570
begin with. In other words, you're going to have the right proportion of
3571
length overall, beam, draft, deck strength and so on and so forth and
3572
the boat is designed to handle varying sea states in its existing
3573
proportion.
3574
3575
There have been a number of famous cases of failures or believed
3576
failures, "Perfect Storm" being one, for instance, where a fishing boat
3577
was altered without consulting a naval architect in that case and wound
3578
up, some people think, capsizing because it had lockers installed on the
3579
deck that caught a sea that came transverse and pushed hard on it and it
3580
rolled over. We'll never know about that.
3581
3582
But my question is when you take a 110-foot boat that was originally
3583
designed to be the ideal proportions, aren't you taking it off of its
3584
ideal proportions by lengthening, almost by definition?
3585
3586
SAMPSON: Absolutely, yes, sir. That was one of our main points, that
3587
this was such an elementary decision point or observation, that if you
3588
lengthen a vessel, the mid-ship section modules or the strength of that
3589
vessel has to be increased.
3590
3591
This is a high speed craft. You don't have that much reserve margin
3592
built in to an existing craft or you'd over-design it and it wouldn't
3593
make the speed.
3594
3595
So to make the assumption that the craft did not have the -- or that had
3596
that reserve strength...
3597
3598
HALL: That's fine. And I just noticed in some of the testimony, the
3599
written testimony of the later witnesses, that the design specs call for
3600
it to operate up to sea state five, 8- to 13-foot seas.
3601
I have a 39-foot cutter myself that I sailed in seas bigger than that.
3602
That seems to me rather like a low threshold for a ship that may have to
3603
operate -- or a boat, it's a ship to me, but I think it's a boat that
3604
may have to operate under considerably more extreme weather, and does
3605
probably.
3606
3607
And on top of everything else, I'm just curious how one could not
3608
overbuild in this situation when you know you're cutting a boat open and
3609
then extending it.
3610
3611
Has that occurred to you?
3612
3613
SAMPSON: Absolutely. There's several things that are associated with
3614
that performance specification and later information that I was told in
3615
regards to the requirements.
3616
3617
We were always verbally told that it was designed to be the same
3618
capability as a 110, just a 123. So a 110, for purposes of the
3619
operators, Mr. Ghosh has commented to me and he'll probably confirm
3620
this, that the 110 is, in essence, unrestricted. It can go out and
3621
operate in a sea that normally the human will give up long before the
3622
ship.
3623
3624
HALL: Right.
3625
3626
SAMPSON: They will pull the throttles back. With the 123, after the
3627
failure, it was explained by Mr. Jacoby that the design spec was
3628
actually poorly written and that the requirements that were being
3629
interpreted were actually lower than what we felt was operationally
3630
needed.
3631
3632
HALL: Thank you.
3633
3634
And, Mr. Atkinson, I just wanted to ask you, I understand that by Coast
3635
Guard accounts, the Matagorda was given its ATO in January of 2005 and
3636
then later that year had a visual inspection.
3637
3638
Do you know if the deficiencies identified in that visual inspection
3639
were severe and was it appropriate that they were waivered?
3640
3641
ATKINSON: No, sir. None of the items that were detected in the visual
3642
inspection should have been waivered. By issuing these waivers, they
3643
quite literally were covering up significant vulnerabilities.
3644
3645
While our enemies may not have directly exploited those vulnerabilities,
3646
they did nonetheless create vulnerabilities that the Coast Guard decided
3647
were acceptable.
3648
3649
HALL: And what's the risk to national security if TEMPEST certifications
3650
testing process is not done properly and the vessel operates and
3651
broadcasts to other vessels?
3652
3653
ATKINSON: National security. A foreign government will be able to access
3654
our classified communications, not just on a one-ship basis, but more of
3655
a -- everything our country has, they can detect our codes, our ciphers,
3656
our hopping patterns, our communications.
3657
3658
They can exploit that not just on the Matagorda, but on everything in
3659
our inventory. You give them the keys to the kingdom when you breach
3660
TEMPEST.
3661
3662
HALL: Thank you very much. Thank you, Mr. Chairman.
3663
3664
CUMMINGS: Thank you.
3665
3666
First of all, I want to thank all of you for your testimony.
3667
3668
I was just sitting here thinking about what you all have said -- and I'm
3669
so glad that we have Americans who care as much as all of you care, and
3670
I really mean that.
3671
3672
One of the things that's really nagging at me, though, is Mr. De Kort
3673
and I'm wondering, Mr. Braden, you've been with Lockheed Martin how
3674
long?
3675
3676
BRADEN: Thirty years.
3677
3678
CUMMINGS: Thirty years. And you've heard the complaints of Mr. De Kort.
3679
Were those, in your mind, I mean, the things that you know about that
3680
you can express an opinion about, were those reasonable things to raise?
3681
3682
I just want to make sure that -- here's a man who, just like everybody
3683
else here, is making it clear that he wants the best for the Coast Guard
3684
and the best for our country. And I'm just wondering, what was your
3685
opinion on those things?
3686
3687
BRADEN: I think the issues he raised I would expect to be raised by any
3688
competent program manager, project manager or engineer.
3689
3690
CUMMINGS: Thank you very much.
3691
3692
Mr. Chairman?
3693
3694
OBERSTAR: I just want to nail a couple of things down with Mr. Atkinson.
3695
3696
The difference between a visual test and an instrumented test, a visual
3697
review and certification through follow-up instrumentation testing, what
3698
is the significance of the one and the other, and the two in
3699
combination?
3700
3701
ATKINSON: The physical inspection tells us if hardware has been properly
3702
placed onto the equipment, that cables are properly bonded, that cables
3703
are connected properly, that they're properly grounded, that isolation
3704
distances have been rigorously adhered to.
3705
3706
Those must be done in a visual inspection before you do an instrumented
3707
inspection.
3708
3709
OBERSTAR: And is it sufficient to do the visual? If those factors are
3710
verified, can the inspector say that's sufficient?
3711
ATKINSON: No, sir. It must pass a visual inspection and then pass an
3712
instrumented inspection.
3713
3714
OBERSTAR: And the instrumentation will tell us whether there is leakage
3715
and at what distance and what can happen with how the signal can be
3716
intercepted.
3717
3718
ATKINSON: Yes, sir.
3719
3720
OBERSTAR: Is that correct?
3721
3722
ATKINSON: It is very similar to going to the doctor with a cough. The
3723
doctor can hear your cough. He can see that you're in pain, but he
3724
doesn't know that you have water on your lungs. So he will send you to a
3725
radiologist to have your chest examined and X- rayed.
3726
3727
The X-ray is an instrumented test. An instrumented test is an absolute
3728
measure based on scientific principles, not just a visual observation.
3729
3730
The two must be done, but the visual needs to be done before the
3731
instrumented and then the visual needs to be repeated on a fairly
3732
regular basis.
3733
3734
OBERSTAR: There is a risk to national security in a vessel handling
3735
classified information and conducting classified communications with
3736
shore side and airborne equipment.
3737
3738
What is the risk to national security if a vessel handles such traffic
3739
without proper TEMPEST certification?
3740
3741
ATKINSON: If a Coast Guard cutter goes into the territorial waters of
3742
Cuba and while they're in the territorial waters of Cuba, they transmit
3743
a classified message through their satellite communications link or
3744
through other means and they have leaky equipment and Cuba picks up on
3745
those leaks, they will have just disclosed to the Cuban government how
3746
our cryptographic equipment works, how our C4ISR equipment works, the
3747
coding that it works on, and they will be giving away not only their
3748
position, but they'll be giving away, again, the keys to the kingdom.
3749
3750
They will allow Cuba to listen in now on any of our ships.
3751
3752
OBERSTAR: And it can be at close range or at long range.
3753
3754
ATKINSON: Depending on the specific vulnerability, it can be as little
3755
as somebody getting within 30 to 50 feet of a vessel or, in other cases,
3756
it can be in excess of several hundred miles.
3757
3758
OBERSTAR: Under those circumstances, was it acceptable that -- an
3759
acceptable risk that the Matagorda received authority to operate in
3760
January 2005?
3761
3762
ATKINSON: No, sir.
3763
3764
OBERSTAR: Without an instrumented test?
3765
3766
ATKINSON: The Matagorda had an instrumented test. It failed.
3767
3768
OBERSTAR: Without a successful test.
3769
3770
ATKINSON: Without a successful test. However, in Coast Guard documents,
3771
there is indication that they had planned a second instrumented test
3772
which was never accomplished.
3773
3774
OBERSTAR: Never accomplished, that's right.
3775
3776
I thank you very much.
3777
3778
Mr. Chairman, I think, as you said earlier, I think we should move on to
3779
the next panel. I'm grateful to these four public spirited citizens who
3780
take their sense of responsibility deeply and genuinely and grateful for
3781
your testimony today.
3782
3783
It will help us get the Coast Guard on a better track.
3784
3785
CUMMINGS: I understand Mr. Kagen has a few questions.
3786
3787
KAGEN: Thank you, Mr. Chairman. I apologize for being late.
3788
3789
Mr. De Kort, I'll keep you only very briefly. Would you agree that this
3790
process of self-certification by Lockheed Martin played a key role in
3791
the failure that you observed?
3792
3793
DE KORT: Yes, sir. It was the fox in the henhouse.
3794
3795
KAGEN: So you think this process of self-certification should be
3796
continued anywhere else?
3797
3798
DE KORT: I don't know that there's a place where you would allow
3799
self-certifying anywhere, whether it's in the government or private
3800
enterprise. It just doesn't sound like something you'd want to do.
3801
3802
KAGEN: Very good.
3803
3804
And would you also agree that in this project, overall, there was no
3805
effective oversight?
3806
3807
DE KORT: Yes. The oversight was not effective and the reason I hesitated
3808
is because I want to draw a distinction between the oversight that
3809
existed and needing more.
3810
3811
I don't necessarily -- I know you need more, OK, because of coverage
3812
issues. Again, there was plenty of oversight, though, with these issues
3813
being raised with the people who were there who had the authority to
3814
make changes.
3815
3816
So more in this case wouldn't have solved a thing. It was decisions that
3817
the people they had made. And every bit of it could have been avoided.
3818
3819
KAGEN: And it was the effectiveness of that oversight that was lacking.
3820
3821
DE KORT: Yes, sir.
3822
3823
KAGEN: And on a personal note, have you ever, at any time, felt that
3824
your health or you life was in danger? Do you ever feel nervous?
3825
3826
DE KORT: No, sir. I feel that I suffered retribution after this while I
3827
was in Lockheed Martin, but it never elevated to the point where I
3828
thought that myself or my family -- I never -- and nothing ever occurred
3829
to make me actually think that.
3830
3831
KAGEN: Very good. Thank you very much.
3832
3833
I yield back.
3834
3835
CUMMINGS: Just to clear up, following up on Chairman Oberstar's
3836
questions.
3837
3838
You know, Mr. Atkinson, one of the most troubling things is this whole
3839
idea of waivers, because you could have all the standards in the world,
3840
but if you're waiving, that's a problem.
3841
3842
The Matagorda, the visual TEMPEST test results are the most troubling or
3843
dangerous from a perspective of protecting classified materials. Is that
3844
right?
3845
3846
ATKINSON: No, sir. My concerns would be with all of the ships. The
3847
Matagorda received extra attention because it was a prototype. That
3848
which was on the Matagorda is also on the other ships, because Lockheed
3849
Martin was required to make it identical on every ship.
3850
3851
Therefore, if the first ship failed, all the ships failed. If the first
3852
ship passes, all of the ships pass. All eight ships failed.
3853
3854
CUMMINGS: So waiver, although there were waivers, I guess you're saying
3855
that even without the waivers, they would have probably failed.
3856
3857
ATKINSON: Yes, sir. It is akin to developing a hull breach and putting
3858
duct tape on it. It will fix it, but not really.
3859
3860
CUMMINGS: This is a mess.
3861
3862
ATKINSON: It is an enormous mess.
3863
3864
OBERSTAR: One last question, Mr. Chairman, if I may, in connection with
3865
that. I know the panel has visited this subject, but on the question of
3866
certification, would you recommend that for hull, for TEMPEST, that the
3867
Coast Guard engage or be subjected to an outside independent party for
3868
certification purposes?
3869
3870
ATKINSON: That's a very difficult issue. The Coast Guard lost their --
3871
it's referred to as a CTTA, which is a certified TEMPEST authority that
3872
attends and graduates a TEMPEST school.
3873
3874
They lost that person due to death prior to the Matagorda being
3875
commissioned or inspected. This person's second in command was then
3876
appointed an acting CTTA. He was not formally recognized by the National
3877
Security Agency as the cognizant authority. This is a matter of
3878
documentation which the committee has in their possession.
3879
3880
As a result, he was not recognized by the NSA as being competent to
3881
perform these inspections nor competent to make the instrumented
3882
inspections.
3883
3884
The Coast Guard turned to the Navy. The Navy sent their CTTA to the
3885
shipyards. He performed the instrumented inspection, which had three
3886
failure points.
3887
3888
The report then went back to the Coast Guard, the acting CTTA, and they
3889
stated issuing waivers. Things were found bad. Instead of fixing it,
3890
they threw a waiver on top of it.
3891
3892
OBERSTAR: Let me ask the other members of the panel, briefly, your
3893
response to that question.
3894
3895
SAMPSON: In regards to structural certifications and such, sir, Mr.
3896
Ghosh would probably be better suited for that question. The issue
3897
primarily is focused, I think, for purposes of the hull.
3898
3899
We have the capabilities. It's just a matter of whether or not we have
3900
the time, resources or the administrative authority to correct the
3901
contractor. Many times, this has been stated before, that I've been told
3902
many times, as an engineer, by a contracting officer that we have to
3903
give the contractor the opportunity to fail.
3904
3905
And that's a very frustrating position to be when we know for a fact
3906
that they are going to fail, but because we're required to give them
3907
that option, if we try to correct the contractor, it's always, "Well,
3908
delay and disruption" or "you're telling me, this is my way, it would
3909
have worked," and it's a very tenuous situation.
3910
3911
OBERSTAR: Mr. Braden or Mr. De Kort, do you have a comment?
3912
3913
BRADEN: As I said earlier, I believe that, say, an independent third
3914
party that would provide some degree of oversight would go a long way
3915
toward resolving differences, subjective differences of what a
3916
requirement is or isn't and I think that would help immensely, both for
3917
the efficiency of the Coast Guard side and the contractor sides.
3918
3919
OBERSTAR: Would the American Bureau of Shipping perform that function?
3920
3921
SAMPSON: That would be for the hull. ABS does have that capability to do
3922
certifications of designs.
3923
3924
OBERSTAR: Thank you.
3925
3926
Mr. De Kort?
3927
3928
DE KORT: Relative to TEMPEST, I could see utilizing, sir, the Navy to do
3929
that, because of their capabilities.
3930
3931
However, I'd come back to ships that float, planes that fly. These are
3932
basic items that are just done, and they're considered to be elementary.
3933
So I don't know that we necessarily need to over-think oversight or who
3934
should be testing.
3935
3936
You get in your car, you put it in drive, you push the gas and the car
3937
goes forward. If it doesn't go forward, it failed. I mean, sorry, these
3938
are basic things.
3939
3940
The Coast Guard should have equipment that survives the elements. If
3941
they don't, then who is? If you have every ship in the Coast Guard
3942
inventory matching designs, like I've said to Mr. Atkinson, 20 years
3943
from now, the Coast Guard gets in level sea state six or whatever
3944
condition or excessive wind, whatever it is, who's going to rescue the
3945
Coast Guard?
3946
3947
And I'd imagine, sir, that you could find pleasure craft, especially
3948
research vessels, that are in much better shape than these craft would
3949
have been going forward.
3950
3951
OBERSTAR: Thank you.
3952
3953
GILCHREST: Mr. Chairman? To your left, I'm to the left of the chairman.
3954
3955
3956
CUMMINGS: Yes. Sorry, Mr. Gilchrest. My Maryland buddy.
3957
GILCHREST: I just had a quick question to Mr. De Kort or anybody else
3958
who wants to answer this.
3959
3960
Standard design, and I'm curious, people have been making these Coast
3961
Guard cutters for a long time now. So if you go from 110 feet to 123
3962
feet, why should that be a problem?
3963
3964
DE KORT: Mechanical engineering is not my background, sir, but I'll just
3965
say, from an observer at 30,000 feet looking in on this, it shouldn't.
3966
3967
I mean, here's the thing. If the contract was that loose or the
3968
requirements were that gray, I'd like to know how ELC, Mr. Sampson or I
3969
figured it out?
3970
3971
I don't know that we had some special insight, capabilities or we're
3972
clairvoyant. So we had the same requirement set, the same contract, the
3973
same everything.
3974
3975
Now, it wasn't perfect. Did we need more oversight? Yes. Would I suggest
3976
potentially a contractual mess? Fine, yes. Could the requirements have
3977
been written better? Yes. But we're talking about just elementary items
3978
here that really don't take much discussion.
3979
3980
GILCHREST: And this is Lockheed Martin. This is not a new boat builder.
3981
If it's elementary design, you go from 110 feet to 123, I mean, is this
3982
that difficult that the hulls are going to breach? What happened?
3983
3984
DE KORT: Well, sir, I can't speak for the breach, but I can speak for
3985
all C4ISR. Again, it was the perfect storm. They made a strategic
3986
decision to bid the job without enough C4ISR engineers and to use people
3987
who literally didn't have enough background or they didn't have enough
3988
people who had the background.
3989
3990
And when they got into it, they were behind right away, because it was
3991
aggressively bid. So they quickly had to make decisions so that they
3992
could stay on schedule. Like I said, the person who picked the
3993
non-waterproof radio's background was a software configuration
3994
management specialist. It was a hardware item.
3995
3996
I mean, it sounds kind of incredible, I suppose, but it's literally what
3997
happened.
3998
3999
So that perfect storm just hit -- I'm sorry. I'm mixing metaphors. But
4000
then it snowballed and they just got in so deep that I don't know that
4001
they could figure a way out.
4002
4003
GILCHREST: This is like the chaos theory in reverse.
4004
4005
DE KORT: Yes, sir.
4006
4007
GILCHREST: Thank you, Mr. Chairman.
4008
4009
CUMMINGS: Well, again, I thank you all.
4010
4011
Mr. De Kort, what you just said is -- you're right. It seems so
4012
elementary. It seems so elementary it's painful.
4013
4014
And it's painful from the standpoint that we're talking about lives,
4015
lives of our Coast Guard folks. We're talking about ships that are not
4016
out there now guarding our coasts, interdicting drug runners, and the
4017
American people are paying big-time.
4018
4019
So I want to thank all of you. And all I can say is that if we can send
4020
-- and I'll say it 50 million times -- if we can send people to the
4021
moon, we ought to be able to fix a ship that's no bigger than this room.
4022
4023
It's incredible to me. We ought to be able to have communications
4024
whereby Cuba and other countries don't even have the capability of
4025
eavesdropping onto those communications.
4026
4027
It's incredible and literally shocking to the conscience. Thank you all
4028
very much. We'll move on to the next panel.
4029
4030
Mr. MacKay, Mr. Anton, Mr. Hamblin, Mr. Stanley, Mr. Rodgers, Mr.
4031
Winterstine, before you all sit down, I'm going to administer the oath.
4032
4033
(WITNESSES SWORN)
4034
4035
CUMMINGS: Thank you.
4036
4037
Mr. MacKay? Sorry, Dr. MacKay?
4038
4039
MACKAY: Good evening, Mr. Chairman and ranking member. I'm very grateful
4040
to be here on behalf of the people of Lockheed Martin and get the chance
4041
to explain the progress that Lockheed Martin is achieving on the
4042
integrated Deepwater system program, where we are responsible for
4043
aviation, C4ISR integrated logistics and system engineering.
4044
4045
Lockheed Martin has enabled deployment of more than 75 upgraded AJ-65
4046
helicopters featuring more powerful engines, delivered two new HZ-144A
4047
maritime patrol aircraft, with six more in various stages of contracting
4048
and construction, progressed through developmental test and evaluation
4049
of the HZ-144A electronic mission system, commenced mission system and
4050
sensor installation on all six J model HZ-130 long range search
4051
aircraft, and sustained service of the MH-68A armed helicopters,
4052
comprising the Coast Guard's helicopter interdiction squadron.
4053
4054
Lockheed Martin has upgraded command-and-control systems aboard all of
4055
the Coast Guard's 39 medium and high endurance cutters, resulting in
4056
significant increases in the seizure of illicit drugs.
4057
4058
In March, the Coast Guard issued full authority to operate the Deepwater
4059
command-and-control system at its district command center in Miami in
4060
District 7.
4061
4062
Achieving authority to operate is the government certification that the
4063
system performs and operates correctly. This system provides enhanced
4064
mission planning tools and facilitates rapid exchange of information
4065
through a common operating picture among Coast Guard commands, cutters
4066
and aircraft.
4067
4068
The system is now being installed in sector San Juan in Puerto Rico,
4069
soon to be followed at major Coast Guard commands in Massachusetts,
4070
Virginia, Washington, Hawaii, California and Louisiana.
4071
4072
Deepwater is delivering and making a real difference, impacting drug
4073
seizures, migrant interdictions and lives saved.
4074
4075
On the Pacific coast earlier this year, the Coast Guard performed a
4076
rescue utilizing an H8-65C helicopter under conditions that would have
4077
been impossible for the aircraft that it replaced.
4078
4079
And just last month, the Coast Guard Cutter Sherman, patrolling off
4080
Central America, utilized its Lockheed Martin installed electronics to
4081
track passively a ship of interest, to board her without alerting her,
4082
and to coordinate the seizure of a record 21 tons of cocaine with a
4083
street value of $300 million, via secure satellite communications.
4084
4085
We take the concerns raised by the Department of Homeland Security's
4086
inspector general seriously. For example, during a Lockheed Martin
4087
review of 123-foot boat cabling, it was determined that 85 out of
4088
approximately 490 cables per ship could not be confirmed as having low
4089
smoke properties.
4090
4091
Subsequently, the government determined that the risks were low enough
4092
to grant a waiver. The cables extend outside on the mast or on the deck,
4093
are surrounded by windows enabling easy ventilation and are short in
4094
length.
4095
4096
After C4ISR equipment environmental requirements were updated in 2005,
4097
it became necessary to resolve inconsistencies in the specifications. A
4098
joint Coast Guard-Lockheed Martin working group was established and
4099
after their consideration of the mission criticality of each component,
4100
its specification compliance and its function aboard the boat, a request
4101
for waiver was determined to be the appropriate action.
4102
4103
This action permitted reconciliation of the program's acquisition
4104
strategy to maximize the use of ruggedized off-the-shelf commercial and
4105
government equipment with a multitude of military standards incorporated
4106
into the requirements.
4107
4108
By requesting a waiver, the Coast Guard was afforded the ultimate
4109
decision as to a course of action according to its standards of cost-
4110
effectiveness and safety.
4111
4112
While there has been much discussion regarding C4ISR TEMPEST
4113
capabilities, the inspector general determined in its report that the
4114
installed C4ISR system was not a security vulnerability.
4115
4116
In fact, an independent third party, the U.S. Navy Space and Naval
4117
Warfare Systems Center, or SPAWAR, as it's colloquially known,
4118
determined the system on the 123-foot patrol boats did not have
4119
compromising emissions in two instrumented tests and was subsequently
4120
approved by the Coast Guard to operate in a classified environment.
4121
4122
Finally, as the inspector general found, the camera system on the
4123
123-foot patrol boats fully complies with the video surveillance system
4124
requirements. It was designed as part of an overlapping series of
4125
measures, including sentries and an intruder detection system. Lockheed
4126
Martin did not consider it prudent to unilaterally increase costs by
4127
providing functionality that the customer did not want or need.
4128
4129
We continue to support the implementation, contractual and program
4130
management process improvements initiated by the Coast Guard, as well as
4131
the active incorporation of lessons learned.
4132
4133
We have supported the creation of a joint configuration control board
4134
and the participation of third parties for independent certification.
4135
4136
In closing, I'd like to read a short quote from the commanding officer
4137
of the Coast Guard's new Lockheed Martin installed C4ISR training center
4138
in Petaluma, California.
4139
4140
Quote, "The contrast between our tools of 1983 and the tools of the
4141
future ships like the Berthoff (ph), is significant. I remember analog
4142
radar, message traffic by teletype, paper charts and maneuvering boards,
4143
Polaroid cameras and slow criminal history checks.
4144
4145
"By contrast, our new national security cutters will train on
4146
computerized digital sensors, radar and charts, have live sharable
4147
digital video, message traffic by PC, voice communications with anyone
4148
clear or secure, and real-time criminal histories and intelligence
4149
checks.
4150
4151
"The Coast Guard will have increased maritime germane awareness to
4152
identify threats and accommodate operating (inaudible) to act when
4153
necessary, all to protect our coastlines and citizens," end quote.
4154
4155
Thank you again for the opportunity to present and explain the progress
4156
we're achieving on the Deepwater program. I look forward to answering
4157
your questions.
4158
4159
Thank you, Mr. Chairman, Mr. Ranking Member.
4160
4161
CUMMINGS: Thank you very much.
4162
4163
Mr. Stanley, do you have a statement?
4164
4165
STANLEY: No, I don't have a statement. I'm here to answer your
4166
questions.
4167
4168
CUMMINGS: Thank you very much.
4169
4170
Mr. Anton?
4171
4172
ANTON: Good evening, Mr. Chairman and Ranking Member of the committee,
4173
and thank you for the opportunity to appear before you to discuss the
4174
Deepwater program.
4175
4176
I am the executive vice president of Integrated Coast Guard Systems and
4177
the vice president of the Deepwater program with the Northrop Grumman
4178
Ship Systems.
4179
4180
As you may know, NGSS has nearly 70 years of experience designing,
4181
constructing and maintaining ships of all types. In that time, NGSS Gulf
4182
Coast operations has produced a total of (inaudible).
4183
4184
I would also like to thank this committee for their strong support of
4185
the Coast Guard and of the Deepwater program.
4186
4187
The 110-foot patrol boats have seen extensive duty since their entry
4188
into service some 20 years ago. The 123-conversion was intended as an
4189
interim measure to enhance the capabilities of the aging patrol fleet
4190
until a new vessel, the fast response cutter, was available to replace
4191
it.
4192
4193
The conversion work was performed by Bollinger Shipyards, the original
4194
builder of the 110s, under subcontract to Northrop Grumman. The
4195
conversion project underwent a traditional set of design and review
4196
processes with contractor and Coast Guard personnel.
4197
4198
After being awarded the patrol boat conversion work, but before
4199
beginning the actual conversion work, the Coast Guard, ICGS, NGSS,
4200
Lockheed Martin and Bollinger, with their joint venture partner, Halter,
4201
engaged in design reviews, including a preliminary design review, a
4202
critical design review and a production readiness review.
4203
4204
These reviews were reviews of the 123 conversion design which were
4205
presented to the Coast Guard in increasing levels of detail. Although
4206
not a contract requirement, ICGS conducted the preliminary design
4207
review, or PDR.
4208
4209
As part of the PDR process, drawings and analysis were submitted to the
4210
Coast Guard for consideration and review.
4211
4212
Half of the attendees at the PDR were Coast Guard personnel. The next
4213
phase was critical design review, or CDR. In conjunction with CDR, the
4214
Coast Guard reviewed a series of design deliverables. CDR presentations
4215
included results from a number of design tests and the Coast Guard
4216
represented nearly half of the attendees.
4217
4218
CDR was followed again by a production readiness review. During the PRR,
4219
the production process procedures and state of the design to convert the
4220
110 vessel into the 123 were presented.
4221
4222
As with the design reviews, the Coast Guard fully participated in the
4223
PRR process. Four days later, the Coast Guard delivered the Matagorda to
4224
Bollinger for conversion in Lockport, Louisiana.
4225
4226
In addition to these various reviews with the Coast Guard, during the
4227
conversion of the first vessel, the Matagorda, the American Bureau of
4228
Shipping examined the designed of the hull extension, the new deckhouse
4229
and monitored key elements of the work being performed.
4230
4231
The Coast Guard also had program management resident offices onsite to
4232
oversee the 123 conversions. At the completion of each conversion and as
4233
part of the acceptance process, the Coast Guard, similar to what the
4234
Navy does, established an in-service inspection board to examine the
4235
performance of the converted cutter and make a formal recommendation of
4236
acceptance.
4237
4238
At the conclusion of the Matagorda work, ABS issued a letter of approval
4239
for the conversion work and expressed no reservations with the
4240
feasibility of the conversion.
4241
4242
Based on all of the reviews and actions, the Coast Guard accepted
4243
delivery of the Matagorda. This same process was applied to each of the
4244
seven patrol boats delivered to and accepted by the Coast Guard.
4245
4246
To date, the problems associated with the 123 conversion include
4247
buckling or hull deformation and shaft and propeller alignment problems.
4248
Neither Coast Guard engineers nor our engineers have been able to
4249
determine the root cause for the 123 patrol boat structural problems.
4250
4251
We understand that Admiral Allen has decided to decommission the eight
4252
123 boats converted under the Deepwater program. Though I'm not privy to
4253
the research, tests and reports that led to this decision, we will
4254
continue to support the Coast Guard's effort to address its mission
4255
needs.
4256
4257
Thank you again for the opportunity to discuss with you the Deepwater
4258
program.
4259
4260
CUMMINGS: Does anyone else have a statement? Thank you very much.
4261
4262
Let me just begin the questioning.
4263
4264
To Mr. Rodgers, what position did you hold with regard to the Deepwater
4265
program?
4266
4267
RODGERS: From January '03 through September '05, I was the lead program
4268
manager for Lockheed Martin.
4269
4270
CUMMINGS: So did that position give you an overall day-to-day cost and
4271
schedule responsibility for the entire Deepwater and C4ISR effort?
4272
4273
RODGERS: The C4ISR effort was part of that responsibility.
4274
4275
CUMMINGS: All right. Was there ever any suggestion provided by you or
4276
your superiors at Lockheed Martin that cost and schedule goals were
4277
paramount and that the mission needs of the Coast Guard took a backseat
4278
to these considerations?
4279
4280
RODGERS: No, sir.
4281
4282
CUMMINGS: Was there pressure to produce this -- you were here when Mr.
4283
Braden testified, were you not?
4284
4285
RODGERS: Yes, I was.
4286
4287
CUMMINGS: And I think he talked a little bit about pressure, not trying
4288
to put words in his mouth, but he did talk about pressure. So you don't
4289
know anything about that pressure, the pressure he talked about.
4290
4291
RODGERS: From an overall program, there's always pressure to perform in
4292
that sense. In my 24 years, there's always pressure to execute the job
4293
you're assigned to.
4294
4295
CUMMINGS: Is it the case that employees of Lockheed Martin, regarded an
4296
assignment to the Deepwater project, as a type of punishment, did you
4297
ever get that impression?
4298
4299
RODGERS: No, I did not.
4300
4301
CUMMINGS: To what degree did limited resources available for the C4ISR
4302
components of the Deepwater project contribute to the failure of
4303
Lockheed to meet all contractual requirements on the systems installed
4304
in the 123s?
4305
4306
Were there budgetary problems?
4307
4308
RODGERS: Overall, we had a schedule challenge. We missed the original
4309
schedule in November of '03 and it was replanned with the Coast Guard to
4310
make March of '04. That was the major focus area, was that how do we
4311
achieve the first delivery.
4312
4313
CUMMINGS: Wait a minute. I'm sorry. I didn't hear a word you said.
4314
4315
RODGERS: OK.
4316
4317
CUMMINGS: Say that again.
4318
4319
RODGERS: The original schedule for delivery of the 123 was November of
4320
'03. And with that, we did a replan with the Coast Guard to make that
4321
March of '04. So from a schedule point of view, we replanned the
4322
original schedule.
4323
4324
CUMMINGS: All right. Now, you heard the testimony of Mr. De Kort, did
4325
you not?
4326
4327
RODGERS: Yes, I did.
4328
4329
CUMMINGS: Were you here for the entire testimony?
4330
4331
RODGERS: Yes, I was.
4332
4333
CUMMINGS: Did Mr. De Kort raise each and every one of these issues to
4334
you and your superiors, the ones that he stated?
4335
4336
RODGERS: Not to me personally.
4337
4338
CUMMINGS: Did you know about them?
4339
4340
RODGERS: I knew after the fact in the sense that I knew there was -- I
4341
facilitated him meeting with some of the senior management. To that
4342
point, I was aware of them.
4343
4344
CUMMINGS: So in other words, did you know what he was going to meet with
4345
senior management about?
4346
4347
RODGERS: I know he had some concerns with the program that were not
4348
being addressed and he wanted to have the ability to talk to some people
4349
in more senior management.
4350
4351
CUMMINGS: So in other words, you made it possible for him.
4352
4353
RODGERS: That was facilitated.
4354
4355
CUMMINGS: All right. And so you never really discussed them in any kind
4356
of detail. Is that what you're saying?
4357
4358
RODGERS: Yes, sir. From my seat, I would not. I was the overall program
4359
manager. So I would have not have spoken in technical detail to his
4360
concerns. We would have relayed that to engineering.
4361
CUMMINGS: Let me ask you this. Do you know whatever became -- do you
4362
know who he met with as a result of your facilitating discussions? Do
4363
you know who he met with after that?
4364
4365
In other words, who you made it possible for him to talk to.
4366
4367
RODGERS: He mentioned in his testimony that he met with the vice
4368
president of engineering, Carl Banner (ph). I was aware of that meeting.
4369
4370
CUMMINGS: And so you know for a fact that he did with meet with the vice
4371
president. What's his name again?
4372
4373
RODGERS: Carl Banner (ph).
4374
4375
CUMMINGS: You know for a fact that he met with him.
4376
4377
RODGERS: I knew that meeting was being set up and since he -- I have no
4378
reason to disbelieve that did not happen.
4379
4380
CUMMINGS: Now, when you heard -- you did hear -- I guess to facilitate
4381
the meeting, you had to hear a little bit about what he was concerned
4382
about. Did you have any immediate response other than facilitating a
4383
meeting?
4384
4385
RODGERS: Overall is that he has a chain of command within his department
4386
and, in particular, said, OK, those -- his concerns, I believe, were
4387
expressed through his chain of command, as he testified.
4388
4389
CUMMINGS: Now, where would you have been on the chain of command with
4390
regard to him?
4391
4392
4393
RODGERS: I was the overall program manager.
4394
CUMMINGS: In other words, what I'm trying to say is that were you -- did
4395
he have to go two steps up to get to you? Were you on the same level?
4396
I'm trying to figure out...
4397
4398
RODGERS: In general...
4399
4400
CUMMINGS: Hear my question. I'm just trying to figure out where you fit
4401
on the chain.
4402
4403
RODGERS: Overall, from a Lockheed perspective, there was approximately
4404
350 people on the Deepwater program. I was the overall lead.
4405
4406
CUMMINGS: The last words?
4407
4408
RODGERS: I was the overall lead.
4409
4410
CUMMINGS: So you were like at the top.
4411
4412
RODGERS: Or second to the top, yes.
4413
4414
CUMMINGS: So in order for him to get to you, that man, he skipped over
4415
some folks. In other words, what I'm trying to get to is, he got to you
4416
and you said there was a chain of command.
4417
4418
You said there's some 300 people. You're at the top. So you then told
4419
him to meet with somebody above you. Is that it?
4420
4421
RODGERS: Overall, he had concerns about some engineering concerns. We
4422
had him meet with the head of engineering to share his concerns.
4423
4424
CUMMINGS: And the person who you facilitated the meeting with, the vice
4425
president that you just spoke of...
4426
4427
RODGERS: Yes.
4428
4429
CUMMINGS: ... that person was above you.
4430
4431
RODGERS: Correct.
4432
4433
CUMMINGS: OK, got you. Now, you've heard -- you're familiar with the
4434
Deepwater program, and you just said that you were responsible for the
4435
day-to-day cost and schedule responsibilities.
4436
4437
So you're pretty familiar with it, are you not?
4438
4439
RODGERS: I left the program 18 months ago. So I'm familiar with it up
4440
until September of '05.
4441
4442
CUMMINGS: Well, let me ask you, you heard the complaints of Mr. De Kort
4443
today, did you not?
4444
4445
RODGERS: Yes, I did.
4446
4447
CUMMINGS: And I'm just wondering, do you have an opinion? Do you think
4448
they were reasonable complaints?
4449
4450
RODGERS: The first time I -- I do not have -- the first time I read his
4451
complaints was in the inspector general's report, which, when I got
4452
called to testify, I read.
4453
4454
I understand the inspector general's report. I don't have a specific
4455
opinion on his complaints, from a technical perspective, because his
4456
complaints, to me, are technical perspectives.
4457
4458
CUMMINGS: Is that unusual for employees to have complaints of this
4459
nature, to have had them with regard to this Deepwater program? I'm just
4460
curious.
4461
4462
I'm sure you've done other programs, too. Is it unusual for people to
4463
bring issues like this to you?
4464
4465
RODGERS: No, it's not unusual for people to bring issues like this to
4466
me.
4467
4468
CUMMINGS: Now, did you ever have a conversation with the vice president
4469
that you referred him to about his complaints? Was there ever a
4470
conversation, ever?
4471
4472
RODGERS: No, not about his complaints specifically.
4473
4474
CUMMINGS: Say that again.
4475
4476
RODGERS: Not about his complaints specifically.
4477
4478
CUMMINGS: About him?
4479
4480
RODGERS: Other than facilitating the meeting, I did not get feedback
4481
from the meeting.
4482
4483
CUMMINGS: All right.
4484
4485
Now, were you aware that Lockheed had planned to install a non-
4486
waterproof radio in the prosecutor's launch on the 123s? Were you aware
4487
of that?
4488
4489
RODGERS: No, I was not.
4490
4491
CUMMINGS: Were you aware that the installation of a non- waterproof
4492
radio in the prosecutors would put the crew of the prosecutors at risk
4493
of potential electric shock?
4494
4495
RODGERS: Can you clarify? When you say "are you aware?"
4496
4497
CUMMINGS: Well, this is what I'm asking you. You're the day-to- day guy.
4498
4499
RODGERS: Right.
4500
4501
CUMMINGS: You're number one or number two. You're there. You're up there
4502
and you said, I didn't say this, you said it. You're the day-to-day
4503
cost, schedule responsibility guy and you said you're familiar with the
4504
project.
4505
4506
RODGERS: Correct.
4507
4508
CUMMINGS: Is that right? I'm not trying to put words in your mouth.
4509
4510
RODGERS: The 123 is just one of many projects within the Deepwater
4511
program.
4512
4513
CUMMINGS: OK. Now, what I'm asking you is that I think you would agree,
4514
if you heard Mr. De Kort, and I think maybe another person may have said
4515
it, too, but this radio that they used is their means of communication,
4516
is that right?
4517
4518
RODGERS: I don't know. I'm not a technical expert from -- I'm not a
4519
technical expert on the 123 design.
4520
4521
CUMMINGS: Let me ask you this. If you're producing a boat and water's
4522
splashing up on it and there's a radio, would you deem it prudent to
4523
have a radio that's waterproof?
4524
4525
RODGERS: Yes, I would.
4526
CUMMINGS: Let me ask you something else. Were you aware that that
4527
topside equipment was installed on the 123s that would not meet
4528
environmental requirements?
4529
4530
4531
RODGERS: No, I was not aware at that time.
4532
CUMMINGS: Were you aware that Mr. De Kort tried to identify this
4533
noncompliant equipment and have it replaced and that Lockheed directed
4534
him not to do so?
4535
4536
RODGERS: No, I was not aware of that.
4537
4538
CUMMINGS: Were you aware that the contractor eventually self- certified
4539
that the topside equipment met specifications when, in fact, it did not?
4540
Did you know that? That's from the I.G. report. Are you aware of that?
4541
4542
RODGERS: I've read the I.G. report once. I'm not familiar -- I have not
4543
studied its contents.
4544
4545
CUMMINGS: Let me ask you this. Do these things that I'm saying to you
4546
concern you? I mean, in other words, you were the top guy.
4547
4548
RODGERS: Right.
4549
4550
CUMMINGS: And we've got a radio that's not waterproof. We've got topside
4551
equipment that they claim met specifications, but didn't. And you're the
4552
top guy. You're the one, I guess, that if anything goes wrong, somebody
4553
says, "Wait a minute. What happened?" Is that right?
4554
4555
You're the one that I guess the president would ask questions of.
4556
4557
RODGERS: I have overall program oversight.
4558
4559
CUMMINGS: Does it concern you that these things have come out in the
4560
I.G. report when you were responsible for this?
4561
4562
RODGERS: The I.G. report, as I said, I've read it. I have not studied
4563
its results. I've been off the program. The first time I saw the I.G.
4564
report was on Tuesday of this week.
4565
4566
CUMMINGS: Maybe you can answer this and maybe you can't, because it
4567
seems like there's -- well. Why was the deficiency in the topside
4568
equipment on the 123s not clearly spelled out on the Matagorda's DD-
4569
250, as the intention to submit a waiver for noncompliance with the
4570
requirement for low smoke cabling was clearly singled out in the DD-
4571
250?
4572
4573
RODGERS: I don't know.
4574
4575
CUMMINGS: Was the deficiency with the topside equipment noted on any of
4576
the DD-250 forms or any of the eight 110-foot patrol boats lengthened to
4577
123 feet?
4578
4579
RODGERS: I would not have had the day-to-day cognizance of what went on
4580
that 123 DD-250.
4581
4582
CUMMINGS: Did the integrated team indicate on self-certification forms
4583
that there were no applicable environmental requirements for the topside
4584
equipment?
4585
4586
RODGERS: I'm not familiar with the self-certification form, other
4587
than...
4588
4589
CUMMINGS: Is there anybody up here that would be familiar with that? Do
4590
you know? Nobody? Can you all, can anybody tell us who we can get the
4591
answers to these questions from?
4592
4593
Mr. MacKay, you seem like you've got an answer.
4594
4595
MACKAY: Mr. Chairman, if I might.
4596
4597
CUMMINGS: This concerns us, because we're here, just trying to get to
4598
the bottom of some things and you tell us that you're in charge. This is
4599
a major corporation, major project. You're sitting there under oath and
4600
then you tell us you don't know anything.
4601
4602
And Mr. Taylor said something that was very, very interesting when he
4603
talked about the fact that he couldn't understand why nobody had been
4604
fired. I guess nobody's been fired because nobody knows anything.
4605
4606
Mr. MacKay?
4607
4608
MACKAY: Mr. Chairman, if I might just explain some things about the way
4609
the certifications and the other things or requirements on the program
4610
are determined.
4611
4612
As other people have mentioned, it's an IPT environment and issues are
4613
vetted in a joint environment, the Coast Guard, Lockheed Martin,
4614
Northrop Grumman and industry.
4615
4616
In spec'ing out a ship program in the C4ISR specifically on that, the
4617
way the program operated was that there's a cutter certification matrix.
4618
Some 1,700 documents that have all the requirements and specifications
4619
that go into outlining the requirements for a cutter that industry must
4620
meet as it presents the cutter for DD-250 and acceptance.
4621
4622
What happens is from those universe of requirements, a cutter specific
4623
certification matrix or a subset of those requirements is culled out,
4624
and they are either assigned to the HM&E lead, Northrop Grumman,
4625
Bollinger, Halter-Bollinger, those folks or to C4ISR.
4626
4627
In the event of the -- as I understand it, I've talked to people who
4628
have contemporaneous knowledge, the issue is that the -- if you look in
4629
the I.G. report, the standard that's called out, MIL Standard 1399-C, at
4630
the time, was only specified for HM&E. It was not specified for C4ISR.
4631
4632
It was not until the July 2005 timeframe that that specification was
4633
deemed and agreed to by Coast Guard and industry working together that
4634
that specific sort, sort 21, if you look on the document, presented in
4635
the I.G. report, photostatically copied there, was deemed to apply to
4636
C4ISR.
4637
4638
That's why, if you look closely at that document, the signature
4639
attesting to the S016 is from Bollinger. They were attesting to
4640
environmental standards with respect to HM&E.
4641
4642
Once it was understood that those -- and assigned properly to C4ISR, a
4643
joint working group was undertaken and as the I.G. outlines in his
4644
report, eventually, a request for waiver was -- a process was
4645
undertaken.
4646
4647
And let me be clear about what that process entails. Industry presents
4648
to government the conditions, specifications, costs of complying with
4649
the requirement. Then government looks at that data and makes an
4650
independent judgment based on its standards of cost- effectiveness, its
4651
assessment of the safety considerations, and either grants the waiver or
4652
deviation or does not do so.
4653
4654
And so it's a very disciplined process in which all the facts relevant
4655
come out on the table and the government is allowed to make a decision
4656
about the prudence of a waiver or deviation or compliance to the
4657
requirement.
4658
4659
And so the reason that the Form S016 that's photostatically copied in
4660
the I.G. report does not bear a Lockheed Martin signature is at that
4661
time on the program, in March '05, I think if you look on the document,
4662
those specifications, MIL Standard 1399-C or Sort 21, as it's also
4663
called right there on the form, were not understood by either government
4664
or industry to pertain to the C4ISR portion of the program.
4665
4666
That judgment was subsequently corrected or changed, altered by mutual
4667
agreement.
4668
4669
CUMMINGS: So the Coast Guard has always said that the certification was
4670
required. Are you aware of that? You haven't heard the testimony, but
4671
are you aware of that?
4672
4673
MACKAY: No, sir, I'm not.
4674
4675
CUMMINGS: They've consistently said that.
4676
4677
MACKAY: The facts that I am aware of, Mr. Chairman, are that it was not
4678
until July 2005 that that specific sort was deemed to apply to C4ISR. It
4679
was given to the HM&E side of the program. It was not given to the C4
4680
side until later in the spring, summer time frame of '05.
4681
4682
CUMMINGS: Would it concern you if we produced a system, C4 system, where
4683
the Cubans and others could eavesdrop? I'm just curious. Would that
4684
concern you?
4685
4686
I watch when the president comes to the Capitol, and they go through 50
4687
million changes. They bring in all kinds of experts to make sure he's
4688
got a secure line. I mean, they have somebody guarding the line,
4689
literally. I wish you could see the operation.
4690
4691
And when I listened to the testimony that we heard a little earlier
4692
about countries being able to eavesdrop, I'm just wondering, is that
4693
something that would concern Lockheed Martin?
4694
4695
MACKAY: Yes, sir. It very well would. And I'd like to just read from the
4696
DHS I.G. report on page 5. The complaint -- I am quoting here, I'm
4697
reading from the report itself.
4698
4699
"The complaint also alleged that the use of non-braided cable would
4700
limit the 123 cutter's ability to meet TEMPEST testing requirements,"
4701
what we've talked about at length here. "However, TEMPEST testing
4702
conducted on the Matagorda and Padre between February 2004 and July 2006
4703
indicated the cabling installed during the C4ISR upgrade was not a
4704
source of compromising emissions."
4705
4706
Those instrumented tests were conducted by SPAWAR, by the Navy's Space
4707
and Electronic Warfare Command, the U.S. Navy, with all their expertise.
4708
4709
CUMMINGS: To your knowledge, was there ever certification, TEMPEST
4710
certification done and it passed?
4711
4712
MACKAY: I'm not...
4713
4714
CUMMINGS: Are you familiar with any TEMPEST certification that took
4715
place with regard to the systems that you put in place?
4716
4717
MACKAY: I'm aware of these tests that were done by the Navy's Space and
4718
Electronic Warfare Command. One was done prior to the DD- 250 or the
4719
acceptance of the vessel in the February '04 timeframe and the other was
4720
done in '06, after the allegations were raised in the I.G. report, sir.
4721
4722
CUMMINGS: Why were you testing in 2004?
4723
4724
MACKAY: That would be testing pursuant to the DD-250, which is the
4725
turning over of the vessel from industry to government. It's the
4726
acceptance form. That's what a DD-250 is, sir.
4727
4728
CUMMINGS: And so you were testing then. So then there were tests later
4729
on, is that correct?
4730
4731
MACKAY: Yes, sir. After the I.G. report and the concerns were raised,
4732
another instrumented test was performed by the Navy and SPAWAR, and I
4733
just read the quote from the I.G. report about the results of those
4734
instrumented tests conducted by the Navy. I can read it again, sir...
4735
4736
CUMMINGS: No, no, no, no, no. I'm going to go to Mister -- I'm going to
4737
come back.
4738
Mr. LaTourette?
4739
4740
LATOURETTE: Thank you very much, Mr. Chairman. Just a couple of
4741
observations before I make my questions.
4742
4743
I would say to both chairmen, over my spring vacation, one of the places
4744
that I visited was the Lockheed Martin site in Akron and, Mr. Chairman,
4745
you should see it. They've taken over the air dock down in Akron, Ohio.
4746
It's one of three, it's my understanding, that are existing still in the
4747
country and they're going to build a high- altitude airship.
4748
4749
And we're not only excited about that, but we're happy with the work of
4750
the aerostats that are protecting our border and also doing yeoman's
4751
work at 5,000 feet in the Middle East.
4752
4753
Having said that, I know that you were all in the room for the first
4754
panel. There's nobody, I think, on the committee, there's nobody in the
4755
audience, there's nobody in the country that thinks that spending $90
4756
million for eight ships that don't work is a good idea or that it's
4757
acceptable.
4758
4759
But taking that off the table -- and if anybody thinks it was a good
4760
idea, then you can chime in, but I don't think I'm going to get any
4761
responses.
4762
4763
There's a big difference between that, in my mind, because that, you
4764
prosecute people, you sue people, money damages are awarded. There's a
4765
big difference between that and some of the stuff that came up during
4766
the first panel and some of the accusations, quite frankly, that are
4767
being leveled against Lockheed Martin.
4768
4769
And the staff tells me that these cameras located around here are "60
4770
Minutes." And I'm going to tell you that there's two types of stories. I
4771
mean, there is bad performance on a contract, which is unacceptable, but
4772
there are also two allegations that I really think, Dr. MacKay, I would
4773
like you to address that have been made during the course of the first
4774
panel and maybe as we proceed.
4775
4776
And Mr. De Kort, the whistleblower in this case, and let's start with
4777
one first, and that's national security. The story sort of perking under
4778
the surface here is that because of a difference between $7 a cable,
4779
$7.95 for 10 feet of cable and $27.95 for 10 feet of cable, that
4780
Lockheed Martin, in the reconfiguration of these 110-feet ships, made
4781
either a schedule decision or a cost decision to put our national
4782
security at risk by installing aluminum mylar cable instead of the
4783
braided, shielded cable.
4784
4785
And I think I need you to tell me what you think about that allegation.
4786
4787
MACKAY: Well, what I will tell you is what I know, sir, is that the --
4788
and these facts are verified by the I.G. report -- that the aluminum
4789
mylar cable met contract specifications.
4790
4791
I think the experts that were here said that there are design choices
4792
that are made. Braided cable has some superior characteristics, but it's
4793
not always and universally a superior or the appropriate choice.
4794
4795
As verified by the I.G. report, the aluminum mylar cable met contract
4796
specifications and both these tests conducted by the Navy's SPAWAR and
4797
reported in this I.G. report said that there were no compromising
4798
emissions.
4799
4800
That's what I...
4801
4802
LATOURETTE: And that's my next question, because Mr. Atkinson said, you
4803
may remember I asked Mr. Atkinson can any witness, under oath, and even
4804
not under oath, I mean, I don't think everybody has to be under oath. If
4805
you don't tell the truth, that's a bad thing, oath notwithstanding.
4806
4807
But I believe, in response to my question, can any witness come before
4808
us and indicate that this system passed the TEMPEST test, and he said
4809
that anybody that said that would be committing perjury.
4810
4811
Now, I understood you to say to not only read that section on page 5 of
4812
the I.G.'s report, but I understood you to say in your introductory
4813
testimony that the TEMPEST system passed. Is that right?
4814
4815
MACKAY: Sir, what I'm attesting to is what I -- there were no
4816
compromising emissions. That was the judgment of the DHS I.G. reviewing
4817
that data.
4818
4819
LATOURETTE: OK. But I really want this, for your sake, as well as the
4820
country's sake, I want that in language that people sitting at home
4821
apparently some Sunday evening can understand.
4822
4823
The allegation was made that Fidel Castro is going to be listening in on
4824
our most secure -- the keys to the kingdom was the phrase used by the
4825
first panel, that because Lockheed Martin made a design choice to put in
4826
the $7.95 cable as opposed to the $27.95, that the keys to the kingdom
4827
are given to Fidel Castro and our enemies.
4828
4829
4830
And I want you to tell me that that's not so, if you believe that.
4831
MACKAY: Sir, that's what I believe and that's what I -- if you read the
4832
inspector general's report, that's what they attest to.
4833
4834
LATOURETTE: OK. Now, let me get to the second issue, because just as
4835
important, if not more important than national security are the lives
4836
and the well-being of the Guardsmen that serve on these ships.
4837
4838
Mr. De Kort's second observation was about low smoke cabling and I think
4839
Mr. Oberstar was -- I think many of us remember what happened when the
4840
bundled cables ignited and we had horrible problems on airplanes.
4841
4842
And there has to be a reason for low smoke cabling specifications for
4843
fires, as well as certainly the health and safety of the crew.
4844
I understood you to say that the low smoke cabling, you went to the
4845
Coast Guard or the Coast Guard -- who came to who on the low smoke
4846
cabling? I'm sorry for not remembering.
4847
4848
Did you go to them for the waiver or did they come to you and ask for a
4849
waiver?
4850
4851
MACKAY: Since we're in an IPT, it's sort of you always discover these
4852
things almost simultaneously, sir.
4853
4854
LATOURETTE: OK. But regardless, a waiver was granted. So somebody
4855
reached the conclusion, and maybe jointly, if you're all in these
4856
meetings, that low smoke cabling wasn't required on these 110
4857
conversions or at least we'd waive that requirement.
4858
4859
MACKAY: The determination that was made is that in a situation like
4860
this, you examine all of the relevant facts, which is where the low
4861
smoke cabling is, what the density of it is. Just a couple of things
4862
that -- 16 of the -- when an analysis was done, 85 of the 490 C4ISR
4863
cables that are on each individual ship were not low smoke.
4864
4865
A couple of facts. Sixteen of the 85 cables were actually extended
4866
outside to the mast or on deck. So if the issue is that when there's a
4867
fire, that there are fumes, those fumes immediately waft away.
4868
4869
Seventy-one of the 85 cables run into the pilothouse, which is
4870
surrounded by windows, enabling easy ventilation. And the cables are --
4871
we're using commercial off-the-shelf or government off-the-shelf, trying
4872
to maximize. That's our acquisition strategy.
4873
4874
So a lot of times you have proprietary cable assemblies where there's
4875
not a low smoke equivalent available. There are cable assemblies that
4876
are attached to equipment, to radar, masts and the like. Sometimes if
4877
you remove the manufacturer-supplied cable, you void the manufacturer's
4878
warranty. And in some situations, it might be cost prohibitive due to
4879
the employment of unique connectors.
4880
4881
But all of that data, and it is a request for a waiver of deviation, all
4882
of that data, all those considerations are bundled together. They are
4883
given to the government.
4884
4885
The government makes a judgment based on cost-effectiveness, its safety
4886
standards, how much risk it's willing to take and whether it's a prudent
4887
risk, and they either grant the waiver or they say, "No, you have to..."
4888
4889
LATOURETTE: No. I get that.
4890
4891
MACKAY: That's the process, sir.
4892
4893
LATOURETTE: I get that. And during these hearings, I think there was bad
4894
judgment all the way around. But, again, I want this to be real clear on
4895
the record.
4896
4897
The allegation is made, and people aren't being shy about the
4898
allegations here, the allegation is made, to save money, to meet a
4899
deadline, Lockheed Martin installed low smoke cables on a ship that
4900
endangered the lives of Coast Guardsmen.
4901
4902
And I want you to tell me whether that's true or not.
4903
4904
MACKAY: No, sir.
4905
4906
LATOURETTE: And because of the explanation, I assume.
4907
4908
(CROSSTALK)
4909
4910
MACKAY: I'm not saying that there's no low smoke -- that there's no --
4911
that all the cabling is low smoke.
4912
4913
LATOURETTE: I know that.
4914
4915
MACKAY: I said that for all the factors that I mentioned...
4916
4917
LATOURETTE: But my question was, I mean, the allegation is that by not
4918
using low smoke cables, you put Coast Guardsmen at risk and you put the
4919
ship at risk.
4920
4921
I believe your answer is no, but could you just say no if that's your
4922
answer?
4923
4924
MACKAY: No, sir, not in the judgment of the government which granted the
4925
waiver.
4926
4927
LATOURETTE: OK. And the last question, Mr. Chairman, just so we're not
4928
parsing words on the TEMPEST system passing.
4929
4930
I think that if Mr. Atkinson were able to come back in here and take
4931
another swing, he would say that the reason that the TEMPEST system
4932
passed the SPAWAR test was because so many waivers were granted that it
4933
really didn't pass the test, it passed the test that wasn't a test.
4934
4935
Would he be right if he said that?
4936
4937
MACKAY: Sir, that's a question that would have to be asked to the
4938
government agencies...
4939
4940
LATOURETTE: And I will.
4941
4942
MACKAY: ... that granted that. And also to, I would guess, to the I.G.
4943
that made the determination that there were no emanations that
4944
compromise those standards, sir.
4945
4946
LATOURETTE: Thank you very much.
4947
4948
Thank you, Mr. Chairman.
4949
4950
CUMMINGS: In fairness, I want to be real clear. We're under oath here
4951
and I want to be real clear.
4952
4953
SPAWAR has stated to this committee that they did not certify the ships
4954
in an instrument test. They simply ran the test.
4955
4956
They gave the data to the Coast Guard. It had deficiencies. The Coast
4957
Guard has turned over records that we have in our possession that we
4958
have reviewed that show that they could not have passed, and if they did
4959
pass, quote/unquote, it was because of waivers.
4960
4961
The I.G. told the committee that the Coast Guard told them they passed.
4962
In other words, the Coast Guard says they passed. But the I.G. did not
4963
have the expertise, and that's according to the I.G., to evaluate the
4964
records.
4965
4966
And so the committee did have the records evaluated.
4967
4968
So we can mess with words from now until forever, but everything we have
4969
gone through, (inaudible) changes, getting records, as a lawyer, I've
4970
never seen anything like it -- from the Coast Guard mainly.
4971
4972
And our staffs have spent literally 19-hour days going through those
4973
records. We got records as late as yesterday evening that we requested
4974
almost a month ago.
4975
4976
And so I hear you, Mr. LaTourette, but I don't want the record to remain
4977
there that there's something where there has been TEMPEST certification,
4978
because I know you are as concerned as I am that certification is, in
4979
fact -- has been, in fact, done.
4980
4981
And all I can say is that's what we have.
4982
4983
And I'm going to come back to you, Mr. Rodgers, because I have some
4984
concerns about some of your testimony.
4985
4986
But now we're going to Mr. Oberstar.
4987
4988
OBERSTAR: Was there a contract specification for a particular type of
4989
radio for these vessels?
4990
4991
MACKAY: Mr. Chairman, if you're directing that at me, I was not on the
4992
program at that time. My entry to the program was in July of 2005. I
4993
don't have any contemporaneous knowledge of that.
4994
4995
OBERSTAR: Well, in the contract, this is an unusual type of contract, in
4996
which there was an absence of very specific contract specifications.
4997
4998
So in the agreement, in the contractual agreement between the Coast
4999
Guard and Lockheed, who is the electronics supplier, was the contractor
5000
free to choose what it, in its judgment, felt was the proper equipment
5001
to put on board this class of vessels?
5002
5003
You don't know? You can't answer that question?
5004
5005
MACKAY: With specific reference to those radios, no, sir, I cannot.
5006
5007
OBERSTAR: Is anyone on the panel able to answer that question?
5008
RODGERS (?): Dr. MacKay mentioned the IPT. Within the IPT environment,
5009
the Coast Guard, working with ICGS, with Northrop Grumman and Lockheed
5010
Martin, was then gone through that process choose which radios.
5011
5012
OBERSTAR: So somebody made a choice for a radio that was not waterproof.
5013
It's going to be operating at sea in an exposed situation, where it can
5014
short out or shock someone or worse. Right?
5015
5016
No one wants to take responsibility for that. No one knows anything
5017
about it on this panel. Lockheed was the contractor, right?
5018
5019
MACKAY: Yes, sir. My experience on the program just doesn't extend back
5020
that far, Mr. Chairman.
5021
5022
OBERSTAR: The issues that I think Mr. LaTourette was raising about
5023
whether individuals were compromised, it's not a question of whether you
5024
made a deliberate choice of the type of cable to achieve a particular
5025
end.
5026
5027
But the fact is that this cable was not sufficient, the cable used on
5028
the to be 123-foot patrol boats was not sufficient to prevent leakage,
5029
correct? That's what we heard from the previous panel.
5030
5031
But on the 170s, that cable, the more secure cable was, in fact, used.
5032
Now, why was cabling on one class of vessel used at a higher level and a
5033
different level used on the other class of vessel?
5034
5035
Dr. MacKay, have you got an answer?
5036
5037
MACKAY: I don't, Chairman. As I've mentioned, my tenure on the program
5038
doesn't extend back to that time frame.
5039
5040
I can take the question for the record, if you (inaudible).
5041
5042
OBERSTAR: Mr. Winterstine, do you believe Lockheed made the right
5043
technical, contractual and ethical decisions on the 123 program?
5044
5045
WINTERSTINE: Mr. Chairman, Lockheed Martin entered into a contract
5046
arrangement to satisfy the 123 requirements that we had under contract.
5047
We went through the design processes, shared those designs with the
5048
Coast Guard, discussed those designs with the Coast Guard and then
5049
implemented those designs. So, yes, sir.
5050
5051
OBERSTAR: You were the program management liaison to the integrated
5052
team. Are the allegations made by -- that you heard previously by
5053
Michael De Kort, are they with or without merit?
5054
5055
WINTERSTINE: Mr. Chairman, Mr. De Kort made quite a few allegations. I'd
5056
rather not offer opinion, sir.
5057
5058
OBERSTAR: Well, on January 7, 2004, Mr. De Kort sent a memo to a number
5059
of people, including Mr. Rodgers, and there are others who are --
5060
Clifford, Ewing, Patrick, Laverty (ph), Brian Laverty (ph) -- Brian
5061
Laverty (ph), I'm sorry -- he's got the names in reverse order -- in
5062
which he says, "I've become increasingly frustrated with the direction
5063
the Deepwater project is following. We have sacrificed hard earned and
5064
well founded engineering and customer-focused principles in order to
5065
meet the needs of non-realistic schedules. I believe this path will
5066
lead, at best, to the delivery of a substandard product that will harm
5067
our reputation and, at worst, the delivery of a product that will hamper
5068
our customer's ability to successfully carry out their mission."
5069
5070
Are you aware of that memo?
5071
5072
WINTERSTINE: No, sir, I am not.
5073
5074
OBERSTAR: Mr. Rodgers, you are on that memo. Are you aware of it?
5075
5076
RODGERS: Not specifically.
5077
5078
OBERSTAR: If you received such a memo, would that get your attention?
5079
5080
RODGERS: Was it a memo? Was it e-mail?
5081
5082
OBERSTAR: Whether it was an e-mail or a memo makes no difference. It was
5083
a message sent on January 7, 2004, time 11:53 a.m. Maybe it was an
5084
e-mail.
5085
5086
The question is, it's a very strong allegation, "a substandard product
5087
that will harm our reputation and, at worst, the delivery of a product
5088
that will hamper our customer's ability to successfully carry out their
5089
mission."
5090
5091
RODGERS: So what you're referring to is an e-mail and I'm not
5092
specifically familiar with this e-mail itself.
5093
5094
OBERSTAR: If you had gotten that, would that trouble you? Would you want
5095
to do something about it?
5096
5097
RODGERS: Overall, with that said, I would encourage him to express his
5098
concerns to his management and let's get them adjudicated.
5099
5100
OBERSTAR: Well, it doesn't appear that much was done about it. It was
5101
sent and you didn't see it. You're one of the signees.
5102
5103
RODGERS: I receive many, many e-mails in a day (inaudible).
5104
5105
5106
OBERSTAR: This is a big contract.
5107
RODGERS: Yes, sir.
5108
5109
OBERSTAR: This goes to the expertise of your organization. You're
5110
supposed to pay careful attention to this stuff and not dismiss it,
5111
saying, "I get many e-mails." I get thousands, all of us get thousands
5112
of communications a week.
5113
5114
RODGERS: Yes, sir. I did not...
5115
5116
(CROSSTALK)
5117
OBERSTAR: .... something of this magnitude, it's serious. You got to pay
5118
attention to it.
5119
5120
CUMMINGS: Would the gentleman yield just for one question?
5121
5122
OBERSTAR: Yes.
5123
5124
CUMMINGS: You said a few minutes ago -- and thank you, the gentleman,
5125
for yielding -- in answer to one of my questions, you said that the
5126
first time you had heard about this was, I think, recently, about you
5127
just did not have very much detail about it.
5128
5129
This memo really outlines everything very, very carefully. And I'm just
5130
wondering, would you now like to -- does this refresh your recollection
5131
at all, I mean, this memo, now that you have it in your hand?
5132
5133
Because he really lays out everything and you're one of the top people
5134
on the project, and if somebody came and said, "I've got these issues,
5135
Mr. Rodgers," and they put them in writing and they're talking about
5136
issues that go to our national security and go to the safety of the
5137
wonderful, brave men and women, patriotic men and women of the Coast
5138
Guard, that we're supposed to be producing a vessel for that's safe, it
5139
seems to me that that would -- that's something that would go to the
5140
very essence of your thought process. And it would also concern you that
5141
your corporation, Lockheed Martin, you don't want them, I'm sure, to be
5142
placed in an embarrassing position.
5143
5144
But what you're saying is that you don't remember the e-mail at all.
5145
5146
RODGERS: Let me clarify, sir. Overall, I mentioned the schedule issue in
5147
November of that year. With that, we added resources. We added
5148
additional talent.
5149
5150
Some of the people on this e-mail were added, such as Mr. Clifford, Mr.
5151
Ewing, Mr. Wilhelm. They were added to the team. My day-to-day
5152
interaction was with those gentlemen.
5153
5154
So to clarify with that, after the November time frame, I did not
5155
interface with Mr. De Kort on a day-to-day basis.
5156
5157
CUMMINGS: Did any of those gentleman bring it to your attention, the
5158
memo?
5159
5160
RODGERS: This memo? Not to my recollection, sir.
5161
5162
CUMMINGS: I yield back.
5163
5164
OBERSTAR: What's emerging from the questioning and from the responses is
5165
the fundamental issue that we're concerned about and there's a
5166
structural failure in the way this program was carried out. There's a
5167
structural failure of the Coast Guard self-certifying and allowing the
5168
contractor to self-certify and there was not a third- party oversight of
5169
this in an effective way.
5170
5171
Ms. Lavan, you're vice president of ethics and business conduct for
5172
Lockheed, correct?
5173
5174
LAVAN: That's correct. Actually, right now, I'm vice president of
5175
internal audits since February.
5176
5177
OBERSTAR: You were at the time of...
5178
5179
LAVAN: For the past three and a half years, since October 2003.
5180
5181
OBERSTAR: When you get an ethics complaint, what was your procedure for
5182
dealing with it?
5183
5184
LAVAN: Well, just as a bit of background on Lockheed Martin and its
5185
ethics program, we have a very solid program that's comprised of a
5186
number of components.
5187
5188
One of the most important components is that we have ethics officers at
5189
each of our major locations, for instance, here, where Deepwater is
5190
located.
5191
5192
And so those ethics officers are tasked with taking in any kind of
5193
complaints that employees bring forward. So they are to conduct thorough
5194
and complete investigations of any complaints that are brought forward,
5195
and that's what Mr. De Kort brought forward in October of 2004 to the
5196
ethics office.
5197
5198
OBERSTAR: He brought forth a very technically complex complaint.
5199
5200
LAVAN: He did. Yes. And the ethics officers that investigated it were
5201
both -- had both engineering -- both had engineering backgrounds.
5202
5203
OBERSTAR: So they had the technical expertise to evaluate the complaint
5204
from Mr. De Kort. Then what was -- in what way was it disposed of?
5205
5206
LAVAN: They conducted an investigation that took over two months. They
5207
looked at all his concerns, talked to people on the program, reviewed
5208
documents and determined that his concerns about an ethical issue were
5209
not substantiated in that they -- we believe, they believe that the
5210
customer was well informed and involved in this decision-making process
5211
on the issues that were raised.
5212
5213
I do want to mention that Mr. De Kort, at that time, had raised the
5214
radio issue.
5215
5216
OBERSTAR: Yes.
5217
5218
LAVAN: It was not investigated, because, as Mr. De Kort himself
5219
mentioned to the committee, it was replaced under warranty by Lockheed
5220
Martin. So those radios were never put on the boat.
5221
5222
OBERSTAR: Do you have a document of exoneration, self- exoneration of
5223
Lockheed that you just mentioned? You said the issue was resolved and it
5224
was determined that there was not an ethical issue here.
5225
5226
Was that in writing?
5227
5228
LAVAN: The issue about the radio?
5229
5230
OBERSTAR: No. The other, the previous question.
5231
5232
LAVAN: Oh.
5233
5234
OBERSTAR: (inaudible)
5235
5236
LAVAN: We keep a record of our ethics investigations. That's not
5237
something we typically share with the complainant. It's internal to
5238
Lockheed Martin.
5239
5240
OBERSTAR: Mr. De Kort said that you told him that the official response
5241
is that the allegations -- his allegations were baseless and had no
5242
merit. Is that the way the ethics...
5243
5244
LAVAN: There were three...
5245
5246
OBERSTAR: ... issue was resolved?
5247
5248
LAVAN: Actually, there were three separate ethics investigations, as Mr.
5249
De Kort continued to be unsatisfied with the results of the
5250
investigations and went to increasingly different levels.
5251
5252
The next level involved what we call our business area, (inaudible
5253
business area, where we put together a team of experts that had
5254
technical background, procurement background, as well programmatic
5255
background, and they again looked at the original investigation. They
5256
talked to people on the program, looked at documents, talked to Mr. De
5257
Kort, and found that his concerns were unsubstantiated because they were
5258
being worked with the customer through the customer system.
5259
5260
OBERSTAR: So did you dismiss the De Kort complaint, ethics complaint, on
5261
grounds of ethics or on substance of the work to be accomplished?
5262
5263
LAVAN: But we never dismissed his complaint. We took his complaints very
5264
seriously and invested...
5265
5266
5267
OBERSTAR: You said it was disposed of and...
5268
LAVAN: Internally, we would go back to Mr. De Kort...
5269
5270
OBERSTAR: You found it not substantiated.
5271
5272
LAVAN: Exactly, yes.
5273
5274
OBERSTAR: So I call that a dismissal.
5275
5276
That's a very important element in this whole inquiry. And you said that
5277
you hold these matters internally. Could the committee receive a copy of
5278
your internal documents for our review, if you wish in a confidential
5279
manner?
5280
5281
LAVAN: Yes. The ethics investigation, certainly, you'd be entitled --
5282
you could receive a copy of that.
5283
5284
OBERSTAR: We'd like to have that.
5285
5286
LAVAN: There's actually -- they're fairly substantial documents.
5287
5288
OBERSTAR: It's a very substantial issue and I think it goes to the core
5289
of our inquiry here.
5290
5291
In the end, did your office at the time or did Lockheed conclude that
5292
the deficiencies existed, as listed by De Kort, but that Lockheed was
5293
not responsible for them because the Coast Guard took contractual
5294
delivery of the boats?
5295
5296
LAVAN: The way we looked at it, and then there was a third
5297
investigation, which I spoke with Mr. De Kort myself and looked at the
5298
program myself personally, and the way we looked at it, for the issues
5299
that Mr. De Kort raised, was that was the customer informed? Were they
5300
fully aware? And were there decisions that were being made in terms of
5301
the -- for the benefit of the customer and the program?
5302
5303
We knew that, at that point, that the SPAWAR had approved the TEMPEST,
5304
had passed the TEMPEST test. We also knew that the ongoing IPT was
5305
looking at the C4ISR specifications and that was to be resolved on a
5306
contractual basis.
5307
5308
So we knew that there was ongoing dialogue and debate between the
5309
customer and Lockheed Martin.
5310
5311
OBERSTAR: So in the end, Lockheed took the position that if the Coast
5312
Guard wanted the problems fixed, they would deal with it, extend the
5313
schedule and add the funds to do so. Is that correct?
5314
5315
LAVAN: We viewed that there was an open and honest dialogue between
5316
Lockheed Martin and the Coast Guard and that both Lockheed Martin and
5317
the Coast Guard, through the IPT provisions of the contract, would reach
5318
a decision that was well informed on both sides.
5319
5320
OBERSTAR: Mr. Chairman, I'll withhold at this point.
5321
5322
CUMMINGS: Mr. Coble?
5323
5324
COBLE: Thank you, Mr. Chairman. I apologize. I've been going between
5325
four or five different meetings, and I was here earlier, but I missed a
5326
good portion of this panel.
5327
5328
It appears what we have is a dependable, respected armed service in the
5329
U.S. Coast Guard and two highly regarded defense contractors plagued by
5330
an expensive fiscal error.
5331
5332
Dr. MacKay, let me ask you a question. In light of the commandant's
5333
proposal for a new direction for the Deepwater program and the problems
5334
that have been revealed today and in previous hearings, how would you
5335
suggest -- what suggestion would you have to improve the protocol and
5336
the procedures that govern acquisition, design, construction,
5337
coordination, et cetera, for future projects?
5338
5339
MACKAY: Sir, I'll limit my remarks to the Deepwater project.
5340
5341
I think that the course of actions that the commandant has laid out is
5342
prudent and goes to a direct and active dealing with issues that have
5343
surfaced on this program.
5344
5345
Industry, both Lockheed and Northrop Grumman, both myself and Mr. Anton
5346
and well above us, extending to our CEOs, have been in active
5347
consultation and discussion about the way forward on this program.
5348
5349
And the new acquisition plan that the commandant lays out, the features
5350
of it, some of the other things at a lower level, like the joint
5351
configuration control board, the incorporation of ABS, I think, are an
5352
affirmative series of steps to meet the challenge and the issues that
5353
have been raised by this committee and other bodies.
5354
5355
And we look forward to continuing to cooperate with the Coast Guard to
5356
effectuate those steps to improve this program and to continue to
5357
deliver the kind of performance that I alluded to in my opening
5358
statement.
5359
5360
The fact that every Coast Guard station now has new HH-65C helicopters,
5361
that all of their medium and high endurance cutters in the Coast Guard
5362
have been touched by not one, but two rounds of upgrades, the fact that
5363
though we have spent a lot of the program time upgrading legacy cutters,
5364
in this year of 2007, we now turn to deliver all new systems, the
5365
HC-144, and eventually the national security cutter, and redeliver the
5366
C-130Js to the Coast Guard, it'll be their longest range and most
5367
capable maritime patrol aircraft.
5368
5369
There's a lot that can be gained as this program goes forward, and I
5370
think the commandant has laid out a prudent and well considered way to
5371
get there.
5372
5373
COBLE: Thank you, sir.
5374
5375
Let me ask you this, Doctor. What level of responsibility do the system
5376
integrator and the contractors have for the failure of the 110- foot
5377
conversion project?
5378
5379
MACKAY: Lockheed Martin is responsible for the C4ISR. I am not aware of
5380
a C4ISR issue that's directly connected to the issues that led to the
5381
lay-up of these cutters.
5382
5383
COBLE: Anybody else want to weigh into that?
5384
5385
Mr. Stanley, Mr. Sampson, the naval architect who was employed by the
5386
Navy and the Coast Guard, appeared on the first panel.
5387
5388
Did he ever contact you regarding this matter?
5389
5390
STANLEY: Not to my recollection, no, sir.
5391
5392
COBLE: Do you know whether he contacted anyone in your company?
5393
5394
STANLEY: It could have happened, but not to my knowledge.
5395
5396
COBLE: All right.
5397
5398
I thank you, Mr. Chairman. I yield back.
5399
5400
CUMMINGS: Thank you very much, Mr. Coble.
5401
5402
Mr. Taylor?
5403
5404
TAYLOR: First, I want to thank all of you, gentlemen and ladies, for
5405
staying around until 8:20 tonight.
5406
5407
I'm going to go back to my question to the last panel. Well over $50
5408
million was spent, eight working Coast Guard cutters are now rendered
5409
useless, and everybody says, "It wasn't me."
5410
5411
Now, if I was running a large offshore supply boat company and had
5412
tasked a company to design a change to those vessels to make them longer
5413
and had hired a company to implement that, and then I found out in a
5414
subsequent Coast Guard inspection that those vessels were now rendered
5415
useless, I would do one of several things.
5416
5417
I would sue the company that designed it, I'd sue the company that built
5418
it and I'd tell all the parties involved that my company's not going to
5419
do another dime's worth of business with any of you until someone
5420
accepts responsibility.
5421
5422
Now, the reason I say that is I'm fortunate enough to serve, as is Mr.
5423
Cummings, not only on this committee, but on the Armed Services
5424
Committee, and there's a heck of a lot of similarities between this
5425
vessel and the LCS, both very similar, thin-hulled vessels, designed to
5426
operate in very tough conditions.
5427
5428
The Navy is counting on the LCS program to ride to the rescue as far as
5429
getting the numbers of the fleet back up. We're having substantial
5430
problems with the LCS program, dollar-wise, cost-wise. Some very serious
5431
mistakes, I think, were made in the construction of it, not addressing
5432
problems as they arose, but continuing to build the vessel so that when
5433
it came time to fix those things, it cost a heck of a lot more than it
5434
should have.
5435
5436
And so, again, using that analogy, I do think this Congress has some
5437
very substantial leverage when it comes to someone stepping forward,
5438
because it just is really easy in my capacity to say we're not going to
5439
build any LCSs.
5440
5441
If the folks who've made the screw-ups here are being counted on to do
5442
great work there and no one's going to admit a mistake and then I've got
5443
to believe they're going to make the same mistakes on the next one.
5444
5445
So at what point does one of you step forward and say, "We made a
5446
horrible mistake. We're not going to bill our nation $50-plus million
5447
for mistakes we made and we're going to accept responsibility for
5448
ruining eight ships that still had a good 10 to 15 years life left in
5449
them." Because that really is an option that's available to me.
5450
5451
I can't guarantee you that the other members of my subcommittee or the
5452
other members of my committee would go along with it, but at this point,
5453
I am dead serious when I make that statement, because I can't look
5454
700,000 Mississippians in the eye and say you all treated us fairly, and
5455
I sure as heck can't look 300 million Americans in the eye and say that
5456
you all have treated me fairly or our nation fairly.
5457
5458
And I'll open it up to the panel, because apparently all of the
5459
decision-makers are represented right there.
5460
5461
I think the stakes are pretty high, folks. I'm giving you an opportunity
5462
to tell me what went wrong and who's going to accept responsibility,
5463
because we do know that there are eight ruined ships that the Coast
5464
Guard is not even trying, at this point, not even trying to fix. They're
5465
either going to scrap them or sink them.
5466
5467
And hope that it's swept under the rug. It's not swept under the rug.
5468
It's a very real problem, and it's a very real problem that could occur
5469
again in the LCS, and I cannot, in good faith, let that happen.
5470
MACKAY: Mr. Taylor, I will tell you that I have met with the -- and
5471
Lockheed Martin has put forward to the Coast Guard for the C4ISR...
5472
5473
5474
TAYLOR: Let's talk about the hull, sir.
5475
MACKAY: The hull?
5476
5477
TAYLOR: Let's talk about the hull.
5478
5479
MACKAY: Sir, I don't...
5480
5481
TAYLOR: Because the reason that the ships are being retired is not
5482
because the radios weren't waterproof, which strikes me as really dumb,
5483
or that we had vulnerabilities on the communications, particularly if
5484
you're a Colombian drug lord and want to know whether or not a vessel is
5485
going to be in a certain place, and there are countries around the world
5486
that might be cooperating with them. So I can see that one, too.
5487
5488
But the reason the ships are being retired is because of hull failure.
5489
And no one has stepped forward to say, "We screwed up."
5490
5491
The builder says he didn't do it, the designer says he didn't do it. I
5492
can tell you one thing: Apparently, the two welders I hired in Bay St.
5493
Louis with a sketch that I did on the back of an envelope, we built a
5494
boat that still works.
5495
5496
All these experts apparently couldn't do what those couple of guys in
5497
Bay St. Louis did for me.
5498
5499
MACKAY: Mr. Taylor, I can't address the hull aspects. Lockheed Martin
5500
wasn't under contract for that.
5501
5502
But I will tell you that we have approached the...
5503
5504
TAYLOR: Sir, I think, as a point of clarification, I think Lockheed
5505
Martin was the lead contractor on that.
5506
5507
MACKAY: No, sir. No, sir.
5508
5509
TAYLOR: You were not involved in any way in the stretching of that
5510
vessel.
5511
5512
MACKAY: No, sir, not with respect to the hull. The HM&E, the hull,
5513
machinery and the electricity, no, sir. That was a...
5514
5515
TAYLOR: You weren't involved in the design.
5516
5517
MACKAY: No, sir.
5518
5519
5520
TAYLOR: You did not hire someone to do the design work.
5521
MACKAY: Sir, the way...
5522
5523
TAYLOR: You didn't pay the folks who did the work.
5524
MACKAY: No, sir. Let me just -- as a point of clarification, sir, and
5525
then I'll turn it over to my -- my partners can comment, because they --
5526
in ICGS, Lockheed Martin is responsible for C4ISR.
5527
5528
With respect to shipbuilding, that is the responsibility of Northrop
5529
Grumman and its partners, one of which is represented here in Halter,
5530
Bollinger.
5531
5532
What I wanted to tell you is that with respect to C4ISR, we have
5533
discussed with the Coast Guard Lockheed Martin proposals for the reuse
5534
of the 123 C4ISR data, equipment on the 123s, and that is -- the Coast
5535
Guard has considered that and they will dispose of that as they deem
5536
fit.
5537
5538
We were not contractually responsible or otherwise participated in the
5539
design or fabrication of the hull. That was a responsibility, under the
5540
joint venture, of Northrop Grumman Ship Systems and their partners on
5541
that side.
5542
5543
TAYLOR: Mr. Anton?
5544
5545
ANTON: The Coast Guard yesterday made the announcement that they were
5546
going to lay up the 110-123 converted -- the converted vessels. In that
5547
announcement, the commandant indicated that there were multiple pieces
5548
of analysis that have been done and that the root cause cannot be
5549
determined based on that analysis.
5550
5551
Now, we're not privileged to that analysis, but we have requested a copy
5552
of it. We need to determine the cause of the failure, sir, and when we
5553
determine the cause of the failure, we'll determine accountability, and
5554
when we determine accountability, we'll know who needs to stand up.
5555
5556
TAYLOR: How long does that take? What was it, two years ago?
5557
5558
ANTON: We just...
5559
5560
TAYLOR: Right around the time of the hurricane, so I realize some of us
5561
were busy with other things. To the best of my understanding, the
5562
Matagorda, the problems on it were better than two years ago.
5563
5564
ANTON: The first problem on Matagorda did occur two years ago. We
5565
immediately dispatched a team, both the Coast Guard, industry, and
5566
Bollinger, Northrop Grumman, Bollinger and the Coast Guard, dispatched a
5567
team to the Matagorda to survey that ship and to find out what had
5568
happened and why the ship had buckled.
5569
5570
In that survey, we found an unwelded stringer right in the area where
5571
the buckling occurred. When we went back and reviewed the analysis, we
5572
felt like that the stringer had caused the problem.
5573
5574
At that point, Bollinger welded the stringer under warranty or under no
5575
cost and the ship -- we thought we had the problem solved.
5576
5577
And I don't -- for the record, I'll have to take for the record the
5578
string of events, but I can't tell you when the next failure occurred,
5579
but I can tell you all eight boats were already in conversion.
5580
5581
And when the next failure occurred, I believe four or five of the boats
5582
had been delivered.
5583
5584
So it does take a long time. A lot of people have looked at it. Just
5585
today, testimony from Scott Sampson indicates that the ABS rules, 1997
5586
ABS rules were flawed.
5587
5588
It takes time. And we were not aware of that, of that comment until
5589
today.
5590
5591
With respect to the design and with respect to the fabrication of the
5592
extension and the vessel, I'll have to let Mr. Stanley comment on that.
5593
5594
TAYLOR: But for the record, because I think I have heard otherwise, and
5595
so I'd like a clarification from you gentlemen under oath, for the
5596
record, was anyone from Bollinger shipbuilding ever invited to look at
5597
the vessels after the problem occurred to see if they could identify
5598
what they thought was causing the problem?
5599
5600
ANTON: I'll let Mr. Stanley answer that.
5601
5602
OBERSTAR: Will the gentleman yield? And the gentleman's right on with
5603
the line of questioning that, in fact, I was going to pursue at a later
5604
point.
5605
5606
So at this stage, Bollinger also did the Navy's extension of the 170- to
5607
179-foot and you had no failures there.
5608
5609
>From what I understand, it's that the work proceeded by strengthening
5610
the hull, and you advised the Coast Guard that they needed to do the
5611
same because they were doing a much greater percentage extension of the
5612
hull than the Navy was doing and they did not take your counsel.
5613
5614
And I want you to add that on to the question, in your response, that
5615
the gentleman from Mississippi raised.
5616
5617
STANLEY: I'll be glad to answer all the questions.
5618
5619
If we could, Congressman Taylor, there's several periods of damage to
5620
the Matagorda, and you've got to decipher and discuss to be for clarity
5621
where Bollinger was involved and where it was not.
5622
5623
And I'd like to offer, if I could, and I think it might be helpful if
5624
we'd spend a couple of seconds to go back over the history of the
5625
Matagorda and then the...
5626
5627
TAYLOR: Can we go back to my direct question first? And then we'll go to
5628
what -- and I certainly want to give you an opportunity to say what you
5629
want to say.
5630
5631
STANLEY: All right.
5632
TAYLOR: I thought I heard representatives from Bollinger Shipyards say
5633
that they had never been invited to inspect the failed vessels so that
5634
they could give their opinion of what went wrong.
5635
5636
STANLEY: That's correct. You heard that in your office and I was there
5637
the day it was said.
5638
5639
TAYLOR: OK. That seems to be a little different from what the gentleman
5640
from Northrop just said.
5641
5642
STANLEY: No...
5643
5644
TAYLOR: So, again...
5645
5646
STANLEY: It's not.
5647
5648
TAYLOR: I'm giving you -- everyone an opportunity to clarify that.
5649
5650
STANLEY: Well, that's what I was trying to do. I need to spend just a
5651
moment with you.
5652
5653
The Matagorda, after she came out of completion at Bollinger of the work
5654
that was contracted under Deepwater, Matagorda went into what they call
5655
a PDMA. It went into a maintenance period.
5656
5657
So there was work done on the ship that was separate and apart from the
5658
Deepwater scope of work. Before it went into its PDMA, it went through
5659
an operational test evaluation period to see if it had -- effectively
5660
would perform to the specification in the contract or the conversion.
5661
5662
It went into the PDMA and then after the PDMA, it went to Key West, and
5663
then following the arrival at Key West -- it left Key West en route to
5664
Miami fleeing one of the storms that year. This is September time frame
5665
of '04.
5666
5667
In fact, several of the boats -- all of the boats in Key West left
5668
fleeing the same storm to Miami. And the damage on Matagorda, the first
5669
damage, buckling damage, happened at that time.
5670
5671
That was reported to Bollinger. The ship was brought back to Bollinger,
5672
to Lockport, Louisiana, and repaired by Bollinger, with a joint
5673
discussion with the Coast Guard of what had happened, what had caused
5674
the failure, and what should be done to correct it.
5675
5676
Northrop Grumman was in that discussion. ICGS was in that discussion.
5677
All the Coast Guard collectively was in that discussion. And we
5678
recognized that in the early calculations of the 110's conversion, that
5679
some mistakes was made in those calculations.
5680
5681
We all identified those mistakes and for the part of the mistakes that
5682
Bollinger made, Bollinger stepped up to the table and certainly said:
5683
That was a mistake and this is the right, correct number and this is
5684
what should be done with this number.
5685
5686
Then what happened was that ship sailed and it had other damage and it
5687
had other decisions made to correct that damage.
5688
5689
Believe it or not, I didn't know until January, in some of the Coast
5690
Guard's testimony, of some of the repairs that was done to the damage --
5691
the Matagorda after it left us.
5692
5693
So it's very difficult for us as a shipyard. And you personally have
5694
known our owners many years and we are very proud of our work and we're
5695
very proud of what we've done with the Coast Guard.
5696
5697
We built all of the (inaudible) class. We built all the CPBs. We dealt
5698
with -- our employees has married Coast Guard people. Our employees have
5699
sons and daughters that serve in the Coast Guard.
5700
5701
We take this very seriously. We are at a loss as to what happened. And
5702
we don't believe, although we respect the commandant's decision, we
5703
don't believe that this question should remain unanswered. There is an
5704
answer, you're absolutely correct.
5705
5706
And the commandant, I can't speak for him, but I think what his decision
5707
was that in the best interest considering everything, it's better to
5708
decommission those ships and move forward.
5709
5710
I think that's what he's thinking. I certainly can't speak for him. But
5711
if you want an answer, there is an answer, and there has been, as Mr.
5712
Anton said, many independent studies done that Bollinger nor Northrop
5713
has seen.
5714
5715
I think we could be very helpful in resolving the solution, but that
5716
information needs to be shared.
5717
5718
TAYLOR: Well, I appreciate the gentleman's answer. I stick by what I'm
5719
saying. If all the parties involved are also involved in the LCS and
5720
none of the parties involved are going to step forward and say, "That's
5721
the problem, this is who ought to pay," then I don't see why our nation
5722
ought to be doing business with you for the LCS.
5723
5724
Mr. Chairman, I yield back my time.
5725
5726
5727
OBERSTAR: Mr. Chairman, I'd like to follow-up on Mr. Taylor's...
5728
CUMMINGS: Mr. Gilchrest, if you don't mind.
5729
5730
OBERSTAR: But just one minute, because Mr. Stanley has said something
5731
extremely important here. We're at a loss as to what happened. There
5732
should be an answer.
5733
5734
And is the answer that Bollinger built both the 170 and the 179 and the
5735
110 and the 123? The 179 did not crack because the hull and the hull
5736
girders were strengthened and the Navy specified that strengthening and
5737
the Coast Guard did not.
5738
5739
STANLEY: That's not quite correct, Mr. Chairman. And if I could, let me
5740
separate two issues for you.
5741
5742
OBERSTAR: All right.
5743
STANLEY: The patrol coastals, the P.C.s for the Navy, were strengthened
5744
very early after their delivery into service, long before the extensions
5745
were added to them and for a much different reason.
5746
5747
The patrol coastals, like the Allen class and like the specifications
5748
for the 123 and like most operating equipment in the marine and in the
5749
air environment, they have operational restrictions.
5750
5751
And in the case of the P.C., P.C. was actually designed and specified to
5752
work in the littorals, but it found itself making many transits on open
5753
ocean. And as it made transits with its normal Navy operations, it made
5754
those with large ship convoys at convoy speeds, and sometimes the speed
5755
of the convoy and the size of the ship would get into weather that would
5756
not affect big ships, but it really affected small ones, like the P.C.
5757
5758
So the Navy -- and we had cracking on the P.C., because the P.C. was
5759
operating outside of its planned and designed environmental envelope.
5760
5761
And we strengthened the P.C.s, which allowed them to then transit with
5762
the big ships in heavy seas at transit speeds.
5763
5764
Much later on, some of the P.C.s, not all, but some of the P.C.s
5765
received stern extensions for a very similar reason as we extended the
5766
110s, to allow for the boarding of a small rigid hull inflatable, for
5767
the safe boarding and exit of a rigid hull inflatable.
5768
5769
But the two are not necessarily connected together and I think that's
5770
very important. It is true that the hulls of the P.C.s were
5771
strengthened. In the case of the 110, this calculation...
5772
5773
OBERSTAR: But did the Navy specify a strengthening of the hull of the
5774
170s in its extension to 179?
5775
5776
STANLEY: I'm sorry, Mr. Chairman?
5777
5778
OBERSTAR: Did the Navy specify hull strengthening for the extension of
5779
the 170 to 179? Did they not give specifics?
5780
5781
STANLEY: No, because the hulls had already...
5782
5783
OBERSTAR: That's what the Navy told us they did.
5784
5785
STANLEY: Well, no. I don't think there's a...
5786
5787
OBERSTAR: The Carderock Division, David Taylor, model basin specialist
5788
told us that, and you're saying they didn't.
5789
5790
STANLEY: I think it's a matter of timing. The Navy and Bollinger
5791
strengthened the hulls on the P.C.s, all of the P.C.s, long before, long
5792
before, several years before the stern extensions were added.
5793
5794
So to say that the Navy instructed Bollinger to increase the strength of
5795
the hull because it wanted to add a stern is incorrect. The hull had
5796
already been changed for another reason and its strength increased for
5797
another reason.
5798
5799
OBERSTAR: All right. We'll desist there, because there are other members
5800
who have questions and I want to go on, in all fairness.
5801
5802
Thank you, Mr. Gilchrest, for forbearing here.
5803
5804
CUMMINGS: Mr. Gilchrest?
5805
5806
GILCHREST: Thank you, Mr. Chairman. I guess I'd like to stick with the
5807
hull design here for a little while.
5808
5809
Mr. Anton, you are executive vice president of Northrop Grumman. Is that
5810
correct? And so you, working with the ICGS, got the contract to work on
5811
the hulls on these 110s. Is that correct?
5812
5813
ANTON: ICGS is the prime contractor. When the contract comes in to ICGS,
5814
the HM&E portion of the work is given to the Northrop Grumman partner of
5815
the joint venture.
5816
5817
GILCHREST: So Northrop Grumman has this contract and you subcontract to
5818
Mr. Stanley or to Bollinger?
5819
5820
ANTON: We did.
5821
5822
GILCHREST: So when Mr. Bollinger was done -- when Bollinger Shipyard was
5823
done with each of these boats at various times, what was your
5824
responsibility before the boat was put into service, after Bollinger
5825
boat yard finished the boats?
5826
5827
ANTON: Could you ask that again?
5828
5829
GILCHREST: Northrop Grumman is the contractor to extend the hull or make
5830
the 110 into a 123. So you subcontract to Bollinger Shipyard to do the
5831
work.
5832
5833
ANTON: Yes, sir.
5834
5835
GILCHREST: Once Bollinger Shipyard is done, what is your responsibility
5836
to ensure that the work was done appropriately?
5837
5838
ANTON: During the production effort at Bollinger, we had a Q.A. team --
5839
a Q.A. plan and a quality assurance team, and we worked side- by-side
5840
with the program office from the Coast Guard reviewing the work that
5841
Bollinger was accomplishing.
5842
5843
In addition to that, the Coast Guard, again, formed an in-serve team, an
5844
in-service inspection team, which actually took the ship out on trials
5845
and then made a recommendation as to whether to accept the ship or not.
5846
5847
GILCHREST: And apparently you and the Coast Guard accepted each of these
5848
ships at various times.
5849
5850
ANTON: Bollinger certified to Northrop Grumman that the work was in
5851
accordance with the spec. In the case of the hull extension, ABS
5852
monitored the structural part of the conversion process and they also
5853
signed a certification that the work was done in accordance with the
5854
design and we accepted that certification based on our on-site Q.A.
5855
team. And we certified that, yes.
5856
5857
GILCHREST: So as a result of that, looking in hindsight at each of these
5858
eight ships going into service, the Matagorda, at 7 February '05 went
5859
into service, and the hull problem was identified 10 September '04,
5860
that's what I have here.
5861
5862
The hull problem -- well, rather than go through all the dates, in
5863
hindsight, was there a design flaw in this extension or was there less
5864
than top grade material used?
5865
5866
Mr. Stanley and Mr. Anton, what was the problem with the breach of the
5867
hull?
5868
5869
ANTON: I'm going to tell you we have to determine the root cause for the
5870
failure. Then we'll understand, and we'll be able to answer that
5871
question.
5872
5873
GILCHREST: Are each of the eight ships different in their failure?
5874
5875
ANTON: Yes. Each ship is, in fact -- you know, fails in a different
5876
area.
5877
5878
The modeling that's been done to date, to my knowledge, I know the
5879
modeling that we have done, but the modeling, I believe, that the Coast
5880
Guard has done has not been able to predict the occurrence of these
5881
failures on each vessel.
5882
5883
GILCHREST: Has there ever been a 110 extended to a 123 in the past?
5884
5885
STANLEY: No, not to my knowledge.
5886
5887
5888
GILCHREST: This is the first time.
5889
STANLEY: Yes.
5890
5891
GILCHREST: So did you, Mr. Anton or Mr. Stanley, who conducted the
5892
technical review of the design prior to the beginning of construction?
5893
STANLEY: We initiated the design, which Northrop reviewed, as well as
5894
the Coast Guard reviewed in the design process. Before we took the
5895
design to construction or to conversion, that design was generated and
5896
vetted many different times.
5897
5898
GILCHREST: How was the design vetted? Was it vetted with third parties,
5899
other engineers, other boatyards, other ship builders?
5900
5901
STANLEY: No. It was vetted inside of our -- inside of the Deepwater or
5902
the ICGS structure. And parts of that design, the stern extension, the
5903
superstructure was vetted to ABS outside to review that design.
5904
5905
GILCHREST: Now, the hull failures went from 10 September '04 to 24 March
5906
'06. Can you tell us anything about -- once you had a failure in '04,
5907
was there any sense or anticipation that you were going to have another
5908
failure in another boat? Was the design changed in future boats?
5909
5910
STANLEY: As I outlined for Congressman Taylor, we were involved in the
5911
initial failure of the Matagorda, and, in fact...
5912
5913
GILCHREST: You say you were not involved.
5914
5915
STANLEY: No. I said we were involved.
5916
5917
GILCHREST: I see.
5918
5919
STANLEY: And the boat brought back to Louisiana, calculations reviewed
5920
with the Coast Guard and hull strengthening on the Matagorda and all the
5921
boats that followed her was applied.
5922
5923
Failures that happened after that point and studies that happened after
5924
that point and events that happened after that point, we do not have any
5925
knowledge of. That has not been shared with us.
5926
5927
GILCHREST: So you were the contractor that worked on the hulls of all
5928
these eight boats.
5929
5930
STANLEY: Yes, sir.
5931
5932
GILCHREST: But you're not familiar with the problem of the breaches in
5933
the hull other than the Matagorda.
5934
5935
STANLEY: That's pretty much correct. And let me say that we're not the
5936
only contractor that worked on the breaches in the hull. As I reported,
5937
the ships left us, they went into an availability. And then, at some
5938
point in time, those ships also received modifications to their hull
5939
structure.
5940
5941
GILCHREST: Where did they receive modifications, at different shipyards
5942
around the country?
5943
5944
STANLEY: At different shipyards, in Savannah, in Alabama.
5945
5946
GILCHREST: But regardless of the modifications, every one of them that
5947
had this extension failed.
5948
5949
STANLEY: I'm not sure of that, and we don't have those records of how
5950
many boats failed.
5951
5952
GILCHREST: Thank you, Mr. Chairman.
5953
5954
CUMMINGS: All eight failed, the ones that I saw, all eight of them
5955
failed.
5956
5957
Mr. Kagen?
5958
5959
KAGEN: Thank you, Mr. Chairman. I recognize the hour is late and the
5960
interest is still quite high, at least for this new representative.
5961
5962
I've been here 100 days and change, so I'm new to ship building. I'm a
5963
physician, a doctor. I design laboratory tests. I have never designed a
5964
boat.
5965
5966
I want to thank you all for being here and giving your best opinion, but
5967
I'm still trying to sort out, in my mind, about these ships that have a
5968
hull that doesn't work.
5969
5970
It's obvious to me that the design was less than perfect and that no
5971
matter who touched and tried to repair the ship after this design was
5972
put into place, they were unable to keep it together.
5973
5974
So I'm trying to decide where the buck stops. Earlier, when you were
5975
testifying about the electrical wire and how well or unwell it's wrapped
5976
for security purposes, I got a little bit dizzy and confused trying to
5977
decide who's in charge.
5978
5979
So with regard to who's in -- where does the buck stop with regard to
5980
the hull design? Would that be Northrop? Would that be Bollinger? And
5981
just to make it easy for me, I've built this for you. So I'll hand it to
5982
you and you pass it around, but when it stops, that's the person I want
5983
to talk.
5984
5985
The buck stops here, who's going to take it?
5986
5987
ANTON (?): Bollinger did the design work for the 110-123 extension. So I
5988
think it's appropriate that Mr. Stanley answer your question.
5989
5990
KAGEN: Mr. Stanley?
5991
5992
STANLEY: I'd be glad for the buck to stop here.
5993
5994
KAGEN: Very good.
5995
5996
STANLEY: I can only supply the information that we have and I can only
5997
tell you that I -- the reason that I'm here today and our basic -- one
5998
of our basic corporate tenets in our company is to not shy away from
5999
good times or bad times.
6000
6001
I can't answer your question where the buck stops yet. I really can't. I
6002
can tell you that we did the design.
6003
6004
KAGEN: All right. So the answer is, yes, you did do the design for the
6005
hull.
6006
6007
STANLEY: We did the design.
6008
6009
KAGEN: And if that design has been proven to be inadequate for the task
6010
at hand, would you agree with me that your company then would be
6011
responsible for the failures that follow?
6012
6013
STANLEY: That could be possible.
6014
6015
KAGEN: And so if I represent the people in Wisconsin, northeast
6016
Wisconsin and we got something designed, the design failed, would it be
6017
too much to ask for our money back?
6018
6019
STANLEY: You certainly could do that. You certainly could do that.
6020
6021
KAGEN: If you did accept damages and we did get all of our money back,
6022
including loss of use for these eight ships in their future years, would
6023
that permanently damage your company? Would it put you out of business?
6024
6025
STANLEY: There's a question before that. There are very clear ways
6026
contractually, in Deepwater as well as naval ship building, that Mr.
6027
Taylor refers to, to determine where the buck stops.
6028
6029
KAGEN: Sir, Mr. Stanley, we cannot hear you. I'm sorry. And this
6030
testimony, I really, really want to hear this.
6031
6032
STANLEY: There's very clear ways and established ways to settle where
6033
the buck stops. There's contractual obligations that are placed on the
6034
contractors. There's obligations the government undertakes in its side
6035
of the contract.
6036
6037
And in the case of the 110 and in the case of any dispute where the
6038
contractors and the government have a problem, there are very clear ways
6039
forward. And we encourage those ways at Bollinger to be pursued, and I
6040
hope that answers your question.
6041
6042
KAGEN: It does in part, and it leads to some other queries. When you do
6043
design a piece of work to extend a ship off the rear end, I'm sure you
6044
had other people take a look at your plans and your designs. Is that
6045
true?
6046
6047
STANLEY: Yes. And I can't tell you how many that...
6048
6049
KAGEN: Would that also mean that there might be other people besides
6050
your own company that should accept at least partial responsibility for
6051
this failure of design?
6052
6053
STANLEY: Well, that's part of the process that I tried to describe.
6054
6055
KAGEN: Are any of those companies represented here this evening?
6056
STANLEY: Well, the Coast Guard is here, Northrop Grumman is here.
6057
6058
KAGEN: That's two other individuals.
6059
6060
STANLEY: And Bollinger is here. I don't know if there's ABS people here,
6061
I haven't seen them.
6062
6063
KAGEN: You don't think anybody else...
6064
6065
STANLEY: But certainly all three of those groups have a responsibility
6066
to share a part of the success or failure of the contract.
6067
6068
KAGEN: I want to applaud your honesty in accepting the buck stops here
6069
sign. I think that it takes a great deal of courage to be here when
6070
things are bad.
6071
6072
I know in the practice of medicine, sometimes doctors will do everything
6073
right, but things still don't work out. People still succumb even to an
6074
illness that's treated appropriately.
6075
6076
And I'm a little saddened because no one has really got to the bottom
6077
line in figuring out why this unprecedented modification of a
6078
lightweight high speed craft hasn't been analyzed to the point where you
6079
could present the data here this evening to someone who really
6080
understands ship building that could explain exactly where a single or
6081
multiple failures occurred in the design.
6082
6083
But, obviously, this is a troubled project and you'd accept that. And I
6084
applaud you for accepting, if not total, at least partial
6085
responsibility.
6086
6087
And I yield back my time.
6088
6089
CUMMINGS: Thank you very much.
6090
6091
I've got to tell you, Mr. Stanley, I just heard what you said. And let
6092
me make sure I'm clear.
6093
6094
Are you trying to tell us -- I just want to make sure I'm clear on this,
6095
because I want the record very, very, very clear, because a lot is
6096
riding on what you just said.
6097
6098
Are you telling me that you believe that Bollinger is responsible for
6099
the hull problem? Is that what you're telling us?
6100
6101
STANLEY: No, not at all.
6102
6103
CUMMINGS: Oh. Then what are you saying? Because I want to make it clear.
6104
I want to make sure that whoever's responsible, going back to what Mr.
6105
Taylor was talking about, is held responsible, because it's not going to
6106
-- we're not going to be able to prevent these things from happening in
6107
the future if we don't get to the bottom line.
6108
And so as I listened to your answer, the answers that you just gave, I'm
6109
sitting here as a lawyer and I'm saying if this was my case and I were
6110
representing Northrop Grumman, I'd say hallelujah, because apparently
6111
somebody had taken responsibility.
6112
6113
Now, I'm just asking you to be clear. What are you saying? He talked
6114
about the buck stopping. And when I hear the buck stopping and to hear
6115
what you just said, it sounds like you were accepting liability here.
6116
Sworn testimony, I would think that somebody would be able to take that
6117
into a court of law and do something with it.
6118
6119
So I'm just curious.
6120
6121
STANLEY: I would like to be very clear with you, as I thought I was very
6122
clear with the congressman. I said there is a process in federal
6123
contracting, a very clear one, that adjudicates disputes. And in the
6124
adjudication of the dispute, it places responsibility and
6125
accountability.
6126
6127
And in our interchange, the congressman asked me how many people was
6128
here in that process that could have responsibility, and I said three.
6129
6130
CUMMINGS: OK, I got you. I just wanted to make that clear and I wanted
6131
to make sure that people back at your company wouldn't be mad at you
6132
when you got back.
6133
6134
Ms. Lavan, let me go to something that you said that is troubling me.
6135
You said that the Coast Guard was kept informed, when we were talking
6136
about Mr. De Kort's complaints and then we showed -- there's a letter
6137
that's sitting up there somewhere from Mr. De Kort, where he made some
6138
complaints.
6139
6140
6141
But you said -- yes, would you pass that to her, Mr. Rodgers?
6142
You said that the Coast Guard was kept informed of various things that
6143
was happening with this contract. Is that correct?
6144
6145
LAVAN: Yes, sir.
6146
6147
CUMMINGS: Now, would they have been kept informed of the topside issue?
6148
6149
LAVAN: You're referring to, first of all, the e-mail. This is January
6150
2004, before the ethics complaint came in, which was October 2004.
6151
6152
And in terms of the topside equipment, where I was talking about the
6153
blow-down of the specifications and where -- as Mr. MacKay was talking
6154
about, where the sort should have been placed, the Coast Guard was part
6155
of the IPT, which is the integrated product team, that was looking at
6156
that issue.
6157
6158
CUMMINGS: OK. So when De Kort raises topside, and that memo is January
6159
2004, is that right?
6160
6161
LAVAN: That's right.
6162
6163
CUMMINGS: It's dated January 2004. The Matagorda is received and a
6164
DD-250 is dated -- that would have been dated around March 2004. Is that
6165
right?
6166
6167
LAVAN: Yes.
6168
6169
CUMMINGS: Now, the Coast Guard becomes aware of noncompliance, according
6170
to the I.G., and I know everybody's very familiar with the I.G. report,
6171
which I'm very impressed with, thank you very much, July of 2005. Are
6172
you aware of that?
6173
6174
LAVAN: Yes.
6175
6176
CUMMINGS: And on August 29th of 2006, the Coast Guard gets a letter from
6177
the integrated team indicating that the topside equipment did not meet
6178
minimum standards. Are you familiar with that?
6179
6180
LAVAN: Not specifically, no.
6181
6182
CUMMINGS: Well, they did. Are you familiar, Mr. MacKay?
6183
6184
LAVAN: I think we're talking about two different...
6185
6186
6187
CUMMINGS: All right. Help me.
6188
LAVAN: One is the TEMPEST issue. The other is the topside equipment
6189
issue. The TEMPEST issue is the one that was approved by SPAWAR in March
6190
of '04.
6191
6192
CUMMINGS: OK. And so...
6193
6194
LAVAN: Separate issues.
6195
6196
CUMMINGS: So the Coast Guard was made aware of that. Is that right?
6197
6198
LAVAN: The Coast Guard was, as I understand, part of the testing.
6199
6200
CUMMINGS: All right. That clears that up. That's good.
6201
6202
Ladies and gentlemen, any other questions?
6203
6204
Let me say this -- we've heard a lot of testimony here today and I tell
6205
you, if I were a judge, I would let the higher authority try to ferret
6206
all this out. I'm being to be very frank with you.
6207
6208
We have so many documents that, to be frank with you, show all kinds of
6209
inconsistencies, to be very frank. And I'm at a point right now where I
6210
have questions, but I think it's better that I turn them over to
6211
somebody else, a higher authority, because this has been -- this
6212
concerns me tremendously.
6213
6214
Thank you very much. Thank you for being here. You're dismissed.
6215
Mr. Ghosh, Mr. Michel, Lieutenant Commander Jacoby and Ms. Martindale.
6216
6217
(WITNESSES SWORN)
6218
6219
CUMMINGS: Thank you.
6220
6221
Mr. Ghosh?
6222
6223
GHOSH: Good evening, Mr. Chairman and distinguished members of the
6224
committee. It is a pleasure to appear before you today to discuss
6225
compliance with the requirements of the Deepwater contract.
6226
6227
I am Debu Ghosh, director of research of the Coast Guard's asset project
6228
office (inaudible) boats. I'm a naval architect with over 30 years of
6229
experience, specializing in the design of high speed craft.
6230
6231
I have been in the boat engineering branch of the United States Coast
6232
Guard for the last 23 years, serving as the branch chief for the last 15
6233
years.
6234
6235
Mr. Chairman, I would like to submit my written statement in the record.
6236
6237
I have a bachelor's degree in naval architecture from IIT, an MBA from
6238
Tulane University in New Orleans, and a master of science degree from
6239
the ICAF (ph).
6240
6241
I have been involved with all the coastal patrol boat acquisition
6242
programs in the Coast Guard, including the 110, plus the 87-foot coastal
6243
patrol boat, the 123 boat conversion and the fast-response cutter.
6244
6245
My branch (inaudible) integrated policy stance on the (inaudible) patrol
6246
boat program began in the spring of 2002 following the contract award to
6247
Integrated Coast Guard Systems.
6248
6249
After identifying our initial concerns with possible (inaudible) and
6250
stern problems, I asked both Coast Guard and the members of the
6251
technical management information team to (inaudible) to the Navy's
6252
(inaudible).
6253
6254
I also solicited to Bollinger that Bollinger consider (inaudible), the
6255
original designer of the Allen class patrol boats. I was unable to get
6256
support for this because the Deepwater contract was a performance-based
6257
contract, so the contractor was solely responsible for the structure of
6258
the design.
6259
6260
Nonetheless, I advised Bollinger to study this matter more carefully due
6261
to the unusual nature of the (inaudible) lightweight vessel by adding
6262
length up instead of by adding length amid ships, which is the normal
6263
process.
6264
6265
After the cutter Matagorda failure, the (inaudible) calculation of the
6266
(inaudible) submitted by Bollinger was found to be in error and did not
6267
meet ABS guide for high speed craft 1997.
6268
A detailed review of the original strength and buckling calculations by
6269
ELC revealed that the primary stress of the deck and the side cell would
6270
exceed the critical buckling strength of the damaged panels.
6271
6272
Subsequently, the Coast Guard accepted the ICGS proposed solution, known
6273
as modification one, comprising three straps welded onto each side. This
6274
raised the (inaudible) enough to meet ABS high speed craft guide.
6275
6276
This modification reduced the stress to an adequate level and also
6277
increased the allowable buckling load on the critical plates. After the
6278
cutter (inaudible) buckling damage, I took over as the project engineer
6279
from Deepwater to find the root cause of the problems with the cutters
6280
when the (inaudible) problems continued.
6281
6282
I ordered six different contracts to nationally and internationally
6283
known contractants to resolve the problems. A variety of tests, analysis
6284
and reviews were performed, including independent third party
6285
(inaudible) analysis.
6286
6287
It is important to note that although this problem originates in
6288
(inaudible) bending and involves overall hull girder strength, the light
6289
structure required for high speed small patrol boats results in various
6290
types of buckling failures, not mainly cracking. These are much more
6291
complicated sets of responses than those commonly seen in larger ships.
6292
6293
I believe this shows that the Coast Guard has to have more direct
6294
responsibility for and control of future acquisitions and oversight for
6295
vessels designs, as this committee has advised and as the commandant is
6296
now implementing.
6297
6298
The Coast Guard has to rely more on the experience of existing proven
6299
vessels and the experienced designers of these specialized high speed
6300
craft. This had been the practice that produced the successful 87-foot
6301
coastal patrol boat and the original 110-foot Allen class patrol boat.
6302
And this is the strategy that Coast Guard is now following for the
6303
replacement patrol boat, FRCD.
6304
6305
This also suggests that independent survey and design funding should be
6306
available to Coast Guard engineers as it was in the past so that the
6307
Coast Guard can investigate potential problems like this in a proactive
6308
fashion.
6309
6310
Thank you for the opportunity to testify before you today. I'll be happy
6311
to answer any questions you may have.
6312
6313
CUMMINGS: Thank you very much.
6314
6315
Mr. Michel?
6316
6317
MICHEL: Good evening, Mr. Chairman and distinguished committee members.
6318
6319
It's a pleasure to appear before you today to testify on the compliance
6320
with the requirements of the Deepwater contract.
6321
6322
My name is Joe Michel. Currently, I'm assistant deputy with the
6323
Nationwide Automatic Identification System project, Coast Guard Office
6324
of Acquisition. Prior to that, I was an engineering technical lead with
6325
the Ports and Waterways Safety System, also with Coast Guard
6326
acquisition.
6327
6328
And from December 2001 to March of 2004, I was the Coast Guard's lead
6329
C4I engineer on the 123-foot patrol boat integrated product team.
6330
6331
I'm pleased at the opportunity to appear before you and I'll be happy to
6332
answer any questions that you have.
6333
6334
CUMMINGS: Lieutenant Commander Jacoby?
6335
6336
JACOBY: Good evening, Mr. Chairman and distinguished members of the
6337
committee. It's a pleasure to appear before you tonight to discuss the
6338
compliance with requirements of the Deepwater contract.
6339
6340
I am Lieutenant Commander Chad Jacoby. I served as the program manager
6341
for the 123-foot patrol boat conversion project from July 2004 to
6342
October 2006. As the 123 program manager, I managed the delivery task
6343
orders under the Deepwater contract that pertained to the production,
6344
delivery and warranty support of the 123-foot cutters.
6345
6346
During my time as program manager, I supervised the delivery of Coast
6347
Guard Cutter Attu, Coast Guard Cutter Nunivak, Coast Guard Cutter
6348
Vashon, Coast Guard Cutter Monhegan, and Coast Guard Cutter Manitou.
6349
6350
I managed contracts with engineering firms to diagnose structural
6351
issues. I administered the one-year warranty period on all eight
6352
delivered 123s. And I managed the contract modifications to install
6353
structural upgrades on the cutters.
6354
6355
Thank you for the opportunity to testify before you tonight and I will
6356
be happy to answer any questions that you may have.
6357
6358
CUMMINGS: Thank you very much.
6359
6360
Ms. Martindale?
6361
6362
MARTINDALE: Mr. Chairman, I have a brief oral statement. I request that
6363
my written statement be entered into the record.
6364
6365
Good evening, Mr. Chairman and distinguished members of the committee.
6366
It is a pleasure to appear before you today to discuss compliance with
6367
requirements of the Deepwater contract.
6368
6369
I am Cathy Martindale. I am currently the chief of the contracting
6370
office for the Coast Guard's Engineering and Logistics Center, located
6371
in Baltimore, Maryland.
6372
6373
I have been a contracting officer for the U.S. Coast Guard for 15 years.
6374
I hold a bachelor of science degree in business administration from the
6375
University of Maryland. I also hold a certificate in procurement and
6376
contracts management from the University of Virginia and a Defense
6377
Acquisition University Level 3 certification.
6378
6379
I was a contracting officer with Coast Guard headquarters and assigned
6380
to the Deepwater program beginning January 2000 through March 2006.
6381
6382
While assigned to the Deepwater program, I served at various times as a
6383
contracting officer in both the surface and air domains at the systems
6384
integration program office located in Roslyn, Virginia.
6385
6386
I was one in a series of three contracting officers responsible for
6387
administering the 110-123 conversion of the Matagorda. As a contracting
6388
officer, I have responsibility for administering, interpreting and
6389
ensuring compliance with contract requirement.
6390
6391
I worked daily with my contracting officer technical representative, the
6392
program office and Integrated Coast Guard Systems. I attended design
6393
reviews, participated in integrated product team meetings and accepted
6394
contract deliverables.
6395
6396
Thank you for the opportunity to testify before you today. I'll be happy
6397
to answer any questions that you may have.
6398
6399
CUMMINGS: Thank you very much. I want to thank all of you for being here
6400
and we really appreciate it.
6401
6402
Mr. Michel, was anyone in the Coast Guard aware, during the 123 program,
6403
of the internal disputes at Lockheed or the actions of Michael De Kort
6404
to raise awareness of his concerns?
6405
6406
Would those kind of issues have been things that would have come to your
6407
attention?
6408
6409
MICHEL: Not as such, sir. I was not aware until some time later that Mr.
6410
De Kort had actually pursued alternative action up through his
6411
management chain.
6412
6413
CUMMINGS: Well, Mr. De Kort indicates that he contacted the Coast Guard
6414
to raise his concerns with them. Do you know whether any action was
6415
taken?
6416
6417
I take it that you found out later on that he had raised issues. Did you
6418
ever find out whether action had been taken in regard to the issues that
6419
he raised?
6420
6421
MICHEL: No, sir, I did not. He was extremely vocal during my tenure with
6422
the IPT.
6423
6424
CUMMINGS: And when you say he was extremely vocal, how did it come to
6425
your attention that he was extremely vocal?
6426
6427
MICHEL: He made his concerns known inside and outside of integrated
6428
product team meetings.
6429
6430
CUMMINGS: And so then you did have knowledge of those concerns, did you
6431
not, based on what you just said?
6432
6433
MICHEL: I did, sir, but I did not know that he had gone as far up his
6434
management chain.
6435
6436
CUMMINGS: When he was complaining, were you aware of specific
6437
complaints?
6438
6439
6440
MICHEL: I was, sir.
6441
CUMMINGS: And did you have an opinion back then, when you were listening
6442
to them or hearing them, as to whether or not they were -- you
6443
considered them to be valid complaints and things that you all should be
6444
concerned about?
6445
6446
MICHEL: Well, sir, he and I shared a lot of the same concerns.
6447
6448
CUMMINGS: Is that right?
6449
6450
MICHEL: Yes, sir.
6451
6452
CUMMINGS: Well, why don't you tell us about the concerns that you shared
6453
and why you had the concerns that you did?
6454
6455
MICHEL: Well, I think we've talked a lot about the TEMPEST concerns this
6456
evening.
6457
6458
CUMMINGS: Yes.
6459
6460
MICHEL: A few things that he might have perhaps...
6461
6462
6463
CUMMINGS: Let me go back for one moment.
6464
MICHEL: Yes, sir.
6465
6466
CUMMINGS: Because I want to make it very -- I want us to be clear. Mr.
6467
De Kort had his concerns, as I understand it, and you had concerns. Was
6468
this a thing that it just so happened that you sort of ended up with the
6469
same concerns or were you all talking and he says, "You know what? I
6470
really don't like this TEMPEST situation," and you sort of joined into
6471
that or were these things that you could sort of observe independently,
6472
is what I'm saying?
6473
6474
MICHEL: Yes, sir, independently. Any two C4ISR systems engineers looking
6475
at the same problem would have come to the same sort of conclusion.
6476
6477
CUMMINGS: No doubt about it.
6478
6479
MICHEL: Absolutely, sir, no doubt.
6480
6481
CUMMINGS: Now, tell me the complaints, the concerns that you had that
6482
were common to his complaints, his concerns?
6483
6484
MICHEL: Early on during the design reviews and during the review of
6485
various contract data, exhibits, it was apparent that there either
6486
wasn't a clear understanding of TEMPEST requirements, for example,
6487
within the Lockheed design community or they were not addressing them.
6488
6489
So during design reviews, during review of contract documents and
6490
designs and submission of comments via the IPT process, these concerns
6491
were made known to Lockheed from the Coast Guard perspective.
6492
6493
And I was not alone. There were many folks in the C4I community that
6494
were matrixed into the IPT that made these concerns known.
6495
6496
So Lockheed went and did this study that was referred to earlier this
6497
evening. And they came to the same conclusion that, yes, in fact,
6498
TEMPEST was a requirement, processing classified information, we're
6499
going to have to adhere to TEMPEST if we want to get this cutter
6500
certified and operate on classified networks.
6501
6502
So a round turn was taken on the design. Lockheed did try, they did try.
6503
The equipment racks were reconfigured. Red and black equipment was
6504
separated, red and black cables were separated. I can't say that there
6505
was any material solution pursued, that is, the equipment that they had
6506
procured, the cables they had procured, that's what they were using.
6507
6508
CUMMINGS: So in other words, he was saying, if I understood his
6509
testimony correct, that he felt that there should have been some other
6510
kind of cables. And it seems like there's been a big deal made of the
6511
kind of cable that was used as opposed to the kind that he thought that
6512
would be best for TEMPEST certification.
6513
6514
Did you have that same concern?
6515
6516
MICHEL: Yes, sir.
6517
6518
CUMMINGS: So what you're saying is that the same type of cabling,
6519
although there were the complaints, Lockheed Martin's reaction to that
6520
was to keep the same type of cabling, but to just kind of reconfigure
6521
it.
6522
6523
Is that a fair statement of what you just said?
6524
6525
MICHEL: Yes, sir. Yes.
6526
6527
CUMMINGS: Now, did you ever make any complaints?
6528
6529
MICHEL: I did, sir. During the design reviews and during the review of
6530
the designs themselves, I made numerous comments and raised my concerns.
6531
6532
Some of these problems, and I think we've talked about the structure of
6533
the Deepwater contract at length this evening, I was trying to work
6534
within the structure of the contract.
6535
6536
CUMMINGS: Well, speaking of working within the structure of the
6537
contract, did you take your concerns to the higher-ups in the Coast
6538
Guard?
6539
6540
MICHEL: I elevated those concerns as high as I could within the program.
6541
6542
CUMMINGS: And how high is that?
6543
6544
MICHEL: To the deputy at the systems engineering and integration team.
6545
6546
CUMMINGS: Say that one more time.
6547
6548
MICHEL: The deputy, sir.
6549
6550
CUMMINGS: And who would that have been?
6551
6552
MICHEL: Mr. Giddons (ph) at the time.
6553
CUMMINGS: And what reaction did you get when you brought those to his
6554
attention?
6555
6556
MICHEL: Well, he was extremely concerned, and he wanted the issues to be
6557
resolved.
6558
6559
CUMMINGS: And so do you know why they were not resolved?
6560
6561
MICHEL: Well, regrettably, I had mentioned that in March 2004, my time
6562
with the Deepwater program came to an end. So there were many issues
6563
that were unresolved that were contractually identified on the DD-250,
6564
which was also referred to earlier this evening, that were, quite
6565
frankly, still up in the air.
6566
6567
CUMMINGS: Why were you so concerned about the TEMPEST issue?
6568
6569
MICHEL: For some of the reasons that the first panel indicated, sir,
6570
compromise of classified information.
6571
6572
CUMMINGS: Now, so when did you leave?
6573
6574
MICHEL: About three weeks after Matagorda was delivered.
6575
6576
CUMMINGS: All right. I'll come back to you.
6577
6578
Ms. Martindale, you were the contracting officer for Deepwater.
6579
6580
MARTINDALE: Yes. I was the contracting officer with the...
6581
6582
CUMMINGS: Is your mike on?
6583
6584
MARTINDALE: Yes, sir, it is. I was the contracting officer administering
6585
the 110-123 delivery task order for the Matagorda.
6586
6587
CUMMINGS: And does the contracting officer have the authority to decline
6588
to accept the delivery of a ship or a boat?
6589
6590
MARTINDALE: Yes. Yes, sir.
6591
6592
CUMMINGS: And is that something that you have done in the past with
6593
regard to Deepwater? In other words, have you declined...
6594
6595
MARTINDALE: I have declined acceptance of data deliverables, but not a
6596
ship, sir.
6597
6598
CUMMINGS: I see. And explain that, explain what you just said. You
6599
decline a date, but not a ship.
6600
6601
MARTINDALE: No. I'm sorry, sir. A data deliverable. We had delivery
6602
requirements for data.
6603
6604
CUMMINGS: Oh, data.
6605
6606
MARTINDALE: Design documents. And when they didn't comply with the
6607
contract requirements, we didn't accept delivery. We gave them our
6608
comments, asked that corrections be made and then we'd accept it once
6609
those corrections were made.
6610
6611
CUMMINGS: So basically, you would get documents from the integrated
6612
team, is that right?
6613
6614
MARTINDALE: That's correct, sir.
6615
6616
CUMMINGS: With regard to, let's say, for example, a ship.
6617
6618
MARTINDALE: Yes.
6619
6620
CUMMINGS: A vessel.
6621
6622
MARTINDALE: Technical specifications, yes.
6623
6624
CUMMINGS: And then you would not necessarily see the ship itself. You
6625
would actually base your judgment on documents that you receive. Is that
6626
a fair representation?
6627
6628
MARTINDALE: No, sir. Prior to delivery of the ship, there's a series of
6629
data deliverables, technical specifications, design documents. If they
6630
did not comply with the requirements of the contract, then I would
6631
reject those deliverables.
6632
6633
CUMMINGS: And how do you confirm the quality of the items for which you
6634
accept delivery?
6635
6636
MARTINDALE: I rely on the technical expertise of my contracting officer
6637
technical representative.
6638
6639
CUMMINGS: And so if a technical representative comes to you and says
6640
something is, say, for example, certified, TEMPEST certified, then you
6641
basically accept that, is that correct?
6642
6643
MARTINDALE: That's correct, sir.
6644
6645
CUMMINGS: And so there is -- and the procedure, I take it, is that you
6646
-- if they are incorrect, you wouldn't necessarily know that. All you
6647
do, is you get a document saying that it's fine or not fine.
6648
6649
MARTINDALE: Yes, sir. I rely on their technical expertise.
6650
6651
CUMMINGS: Now, were you at all concerned about the condition in which
6652
123s were delivered?
6653
6654
MARTINDALE: Yes.
6655
6656
CUMMINGS: At any time.
6657
6658
MARTINDALE: Yes, sir. There were areas where it did not comply with the
6659
contract. As a contracting officer, it would be my preference not to
6660
take delivery of something that's not in full compliance.
6661
6662
But we had discussions with regard to that, the COTR and myself, and the
6663
noncompliant issues were such that they could be resolved after
6664
delivery.
6665
CUMMINGS: So in other words -- wait a minute. Let me make sure I get
6666
this right. You're saying that you would accept the delivery and it
6667
would be -- you would accept it, but there were assurances made to you
6668
that things would be corrected later.
6669
6670
MARTINDALE: That's correct.
6671
6672
CUMMINGS: Now, is that standard procedure?
6673
6674
MARTINDALE: It is not unusual, sir. It is a common practice in
6675
contracting where you sign a DD-250 accepting delivery of a product or
6676
service and you may withhold some aspect of payment or identify
6677
nonconformance areas with the expectation that, at some point in the
6678
future, they will bring the product into conformance.
6679
6680
CUMMINGS: Now, were all the major deficiencies noted in the DD- 250 for
6681
the Matagorda and each subsequent ship?
6682
6683
MARTINDALE: I can't speak to the subsequent ships, sir, but for the
6684
Matagorda, to my knowledge, all the nonconformances were identified in
6685
the DD-250, sir.
6686
6687
CUMMINGS: Was there noncompliance of the topside equipment noted on the
6688
DD-250 with regard to the environmental standards?
6689
6690
MARTINDALE: No, sir.
6691
6692
CUMMINGS: It was not. And if it was not, why would that not have
6693
happened, because why? In other words, if there was a problem with the
6694
topside equipment with regard to the environmental standards and it had
6695
not been met, why would that not be noted on the DD-250?
6696
6697
MARTINDALE: If it was an area of noncompliance, it should have been
6698
noted, sir.
6699
6700
CUMMINGS: And the I.G. said that it was an area of noncompliance. Are
6701
you aware of that?
6702
6703
MARTINDALE: No, sir.
6704
6705
CUMMINGS: Does it concern you that we may have accepted a ship that did
6706
not have that notice on the DD-250...
6707
6708
MARTINDALE: Yes.
6709
6710
CUMMINGS: ... when, in fact, there was a problem?
6711
6712
MARTINDALE: Yes, that would be a concern, sir.
6713
6714
CUMMINGS: Are there occasions when you have -- this has happened in the
6715
past where maybe something came in, you accepted compliance, DD-250
6716
prepared, and then you later found out that there was something that was
6717
not right? Has that happened?
6718
6719
MARTINDALE: I haven't had any firsthand experience with it, sir.
6720
CUMMINGS: OK. So with regard to -- I want to just make sure I'm clear on
6721
this. With regard to the 123, the program, call it the program, were
6722
there other things, were there things that concerned you overall? Was
6723
there anything unusual that concerned you?
6724
6725
MARTINDALE: It was a very large, complex program, sir. I was not only
6726
responsible for the 110-123 DTO administration, but I also had
6727
responsibility for administering the NSC, the SRP and the FRC. So I was
6728
spread very thin, sir.
6729
6730
CUMMINGS: You did all that by yourself?
6731
6732
MARTINDALE: Yes, sir. I was the sole contracting officer responsible for
6733
all those delivery task orders. So that was certainly a concern.
6734
6735
CUMMINGS: Now, with regard to change orders, how were they dealt with?
6736
6737
MARTINDALE: If the COTR identified an area of the contract requirements
6738
that they wanted to modify or add or subtract from, I would request a
6739
proposal from the contractor. And then we'd receive that proposal,
6740
review it, negotiate and modify the contract.
6741
6742
CUMMINGS: Now, did that happen often with the 123 project?
6743
6744
MARTINDALE: No, sir.
6745
6746
CUMMINGS: You've been sitting around here for all this testimony
6747
earlier, have you not? Just about all of it.
6748
6749
MARTINDALE: Yes, sir.
6750
6751
CUMMINGS: And you heard that there were concerns with regard to wiring
6752
and whether one piece of wire cost a little bit more, cable cost a
6753
little bit more than the other.
6754
6755
Did those kind of things ever come to your attention in any way? In
6756
other words, did the integrated team ever come back and say, "Look,
6757
we've got a problem here, we need to change the wiring?"
6758
6759
MARTINDALE: On the 110-123 contract, that delivery task order?
6760
6761
6762
CUMMINGS: Yes.
6763
MARTINDALE: That was a firm fixed price performance-based contract. So
6764
as far as the contractor and the type of cable that they would install,
6765
for them to correct that issue would not have necessitated a
6766
modification to the contract.
6767
6768
They needed to do whatever was necessary to meet the standards that were
6769
incorporated into the contract.
6770
6771
CUMMINGS: Period.
6772
6773
MARTINDALE: Period.
6774
CUMMINGS: Let me make sure I'm clear on this. Even if it cost more,
6775
you're saying if the specifications ask for a certain thing, if they
6776
wanted to change from the -- do something other than the specifications
6777
with regard to cabling...
6778
6779
MARTINDALE: The specifications of the 110-123 contract did not specify a
6780
type of cable. It specified a standard and then they had to decide what
6781
type of cable to use to comply with that standard.
6782
6783
If they chose the wrong cable and needed to use a different type of
6784
cable, a contract modification is not necessary to make that change.
6785
They just need to make whatever changes are necessary to comply with the
6786
standard that was incorporated into the contract.
6787
6788
CUMMINGS: But if their complaint was that it's going to cost us more
6789
money.
6790
6791
MARTINDALE: That's the firm fixed price risk nature of performance of
6792
that type of contract.
6793
6794
CUMMINGS: So it would fall on the contractor.
6795
6796
MARTINDALE: Yes.
6797
6798
CUMMINGS: And so you might not ever even know about that, is that what
6799
you're saying?
6800
6801
MARTINDALE: That's correct, sir.
6802
6803
CUMMINGS: Let me just ask you this final question. The Defense
6804
Acquisitions University, are you familiar with them?
6805
6806
MARTINDALE: Yes, sir.
6807
6808
CUMMINGS: In its report on Deepwater, it indicates that the contractors
6809
and the Coast Guard were both incentivized to under- estimate the cost
6810
of the new systems and their technical support needs.
6811
6812
Do you think that was the case?
6813
6814
MARTINDALE: No more than any other contractor is incentivized to do that
6815
to capture a contract in their bidding process. They may have
6816
under-estimated things in an attempt to come in with the lowest possible
6817
bid to capture the contract. But that's not...
6818
6819
CUMMINGS: That's not unusual.
6820
6821
MARTINDALE: No. And we did do cost realism analysis when we evaluated
6822
the initial proposals to be awarded the Deepwater contract to try to
6823
ferret out those types of concerns.
6824
6825
CUMMINGS: And did the integrated team ever develop cost estimates that
6826
it knew were lowballed?
6827
6828
MARTINDALE: Not that I'm aware of.
6829
CUMMINGS: So basically, what you're saying to me is that folks can come
6830
in with a low bid to get the contract, get the contract and then when
6831
they get it, come back for change orders and things of that nature, and
6832
that's not unusual. Yes or no?
6833
6834
MARTINDALE: I don't know that I say unusual or not.
6835
6836
CUMMINGS: But you've seen it. You believe that you have seen that
6837
happen.
6838
6839
MARTINDALE: Yes, sir.
6840
6841
CUMMINGS: You can't say for sure, but based upon just your judgment, you
6842
believe that's happened.
6843
6844
MARTINDALE: Yes, sir.
6845
6846
CUMMINGS: OK. I'm not trying to put words in your mouth. I'm just asking
6847
a question.
6848
6849
Mr. LaTourette?
6850
6851
LATOURETTE: Thank you, Mr. Chairman.
6852
6853
Ms. Martindale, I want to pick up a little bit where the chairman left
6854
off.
6855
6856
I think I have in front of me the DD-250 for the delivery of the
6857
Matagorda. And just so I'm clear, under the exceptions section, there's
6858
no reference to the shielded, braided cable. The requirement left on the
6859
TEMPEST system is that the TEMPEST and classified testing will occur
6860
after the delivery of the ship.
6861
6862
MARTINDALE: That's correct.
6863
6864
LATOURETTE: OK. And have you looked at the inspector general's report,
6865
the DHS inspector general's report?
6866
6867
MARTINDALE: No, I have not, sir.
6868
6869
LATOURETTE: Let me just -- the reason for that not being listed on here,
6870
on page 5 of the inspector general's report, it indicates that according
6871
to the contract required the use of only shielded, not braided metallic
6872
shielded cable as recommended by the National Security
6873
Telecommunications.
6874
6875
And so because the contract didn't make the requirement of the braided,
6876
you wouldn't list that as an exception. What was yet to occur is the
6877
TEMPEST testing.
6878
6879
MARTINDALE: That's correct, sir.
6880
6881
LATOURETTE: And, Mr. Michel, I don't know if you're the right one to ask
6882
this series of questions to or not, but we've sort of been going around
6883
and around on this TEMPEST testing business.
6884
6885
MICHEL: Yes, sir.
6886
6887
LATOURETTE: Sort of a -- I'm not going to go there. And we had a witness
6888
on the first panel who said no way could this ever pass the TEMPEST
6889
testing.
6890
6891
We have, in the inspector general's report, not a clear indication that
6892
it passed the TEMPEST testing, but the sentence is, "The TEMPEST testing
6893
conducted on the Matagorda and Padre between February '04 and July '06
6894
indicated that the cabling installed," so I guess this is the mylar
6895
aluminum cabling, "during the C4ISR upgrade was not a source of
6896
compromising emissions."
6897
6898
Are you familiar with that finding by the inspector general?
6899
6900
MICHEL: I am not, sir.
6901
6902
LATOURETTE: Do you have any opinion on that, in light of your
6903
observation that you shared the same concerns as one of our previous
6904
witnesses?
6905
6906
MICHEL: I had examined the visual inspection report that was provided to
6907
the program by TSCOM (ph) and I was made aware of the instrumented
6908
TEMPEST survey results that had been performed by SPAWAR. And in neither
6909
case, the initial survey, was the vessel recommended for certification.
6910
Basically, it failed both tests.
6911
6912
So what we did to simplify matters on the DD-250, the items were rolled
6913
up into this one line item, this TEMPEST and classified testing, because
6914
it was simply impossible to do classified testing until we could get the
6915
vessel to pass TEMPEST. You just can't do it.
6916
6917
LATOURETTE: Let me ask you this. This observation by the I.G. that
6918
whatever testing was conducted indicated that there was not -- the big
6919
issue in the second panel, if you were here, and the first panel, is
6920
that we had national security stuff floating all over the country and
6921
our enemies are listening in on these or could have the ability to
6922
listen in on these ships, compromising national security.
6923
6924
Do you think that the statement that the cabling installed, even though
6925
it's not the braided cable that everybody prefers, was not a source of
6926
compromising emissions is an accurate statement or not?
6927
6928
MICHEL: It's possible, sir. I didn't actually see the instrumented
6929
TEMPEST results for that particular compartment. It is possible.
6930
6931
LATOURETTE: Who would have been in charge of that?
6932
6933
MICHEL: That would have been Mr. Ron Porter at TSCOM (ph). The report
6934
itself was classified.
6935
6936
LATOURETTE: Right.
6937
6938
And back to you, Ms. Martindale, just for a minute. One of the
6939
exceptions listed in number 7 is low smoke cable that we've heard some
6940
things about, too.
6941
We've also heard from Lockheed Martin that I think, at some point in
6942
time, I think after the delivery of the fourth ship, that a waiver was
6943
granted. Were you involved in that process?
6944
6945
6946
MARTINDALE: No, sir.
6947
LATOURETTE: Who would have been involved in that process?
6948
6949
Commander Jacoby, thank you. Can you sort of walk us through how that
6950
happened?
6951
6952
JACOBY: Yes, sir. In July of 2004, I reported on board. One of the
6953
issues that was pending, sir, was a request for waiver from the
6954
contractor to the Coast Guard for around 80 cables that did not meet the
6955
low smoke requirement.
6956
6957
I could see from the documentation that the IPT had worked this issue
6958
for close to a year. The number of low smoke cables in the waiver
6959
request originally was very high. Through the IPT process, those cables
6960
were -- the number of cables on the waiver was reduced to 80.
6961
6962
I consulted with the IPT, got their input. I also called the C4ISR lead,
6963
Mr. Michel's replacement, and got his input on recommendation on
6964
approval or disapproval of the waiver.
6965
6966
I signed the waiver. Actually, I signed a recommendation of the waiver,
6967
forwarded it to the contracting officer, and the contracting officer
6968
approved the waiver.
6969
6970
LATOURETTE: Now, again, there's a couple story lines that can come out
6971
of this investigation and this hearing and one relative to the low smoke
6972
cable is that because that requirement was waived, that Guardsmen are
6973
put at risk if there should be a fire aboard that vessel.
6974
6975
So I guess I appreciate your observations as to why you agreed to that
6976
waiver if that were an accurate assessment.
6977
6978
JACOBY: Yes, sir. To be accurate, the requirement was not waived. The
6979
request for deviation was approved for specific cables and those
6980
specific cables, as was addressed before, were either on the mast, which
6981
the rationale that was provided from the IPT and from the C4 community
6982
was that a cable on the mast that produces smoke does not put anyone at
6983
risk.
6984
6985
Also, some of the cables on the waiver request were -- some examples
6986
would be phone cords or keyboard cords, not cables that were installed
6987
by Lockheed Martin, but cables that came on COTS equipment and the
6988
determination from the IPT and from the C4 community was that you would
6989
not want to cut the phone cords off the COTS equipment and have Lockheed
6990
try to put low smoke cables in their place, sir.
6991
6992
Those were the rationales that I received before signing the waiver.
6993
6994
LATOURETTE: And were you involved at all in the TEMPEST cabling issue?
6995
6996
JACOBY: I was involved with -- not with the initial design, no, sir, but
6997
I did provide the cutters -- make the cutters available to the TEMPEST
6998
inspectors.
6999
7000
And then, also, as the PM, when discrepancies were identified, I pursued
7001
either physical correction of those discrepancies by enforcing the
7002
requirements of the contract or correcting the discrepancies to the
7003
satisfaction of Mr. Porter, the certifying authority at TSCOM (ph), sir.
7004
7005
LATOURETTE: And let's get to that, because, again, when I was talking to
7006
Mr. Michel and we've talked to other witnesses, the allegation is that
7007
even though the contract wasn't violated, according to the I.G.'s
7008
finding, that the contractor had a choice, there's a preferred cable.
7009
7010
The preferred cable was not used and because the preferred cable was not
7011
used, we had a danger of national security being compromised. What's
7012
your take on that?
7013
7014
JACOBY: My take, sir, is I relied on the recommendations and counsel of
7015
the C4 experts and the Coast Guard, which, to my knowledge, are
7016
certified to certify TEMPEST requirements.
7017
7018
Like I said, we made the ships available for the inspections. We
7019
received the discrepancies from the inspections. We satisfied those
7020
discrepancies to the satisfaction of the TEMPEST authority.
7021
7022
LATOURETTE: And this is kind of key to me, because I think everybody
7023
wants to be clear. When you say "satisfied to the satisfaction of the
7024
TEMPEST authority," is there, when this thing passes, I know when it
7025
doesn't pass, you get a report that says here are the problems.
7026
7027
When it passes, is there some kind of certificate that's issued or how
7028
do we know -- how do you know that it's passed? How do you know if it's
7029
passed?
7030
7031
JACOBY: Yes, sir. An interim authority to operate or an authority to
7032
operate is granted once the -- once Mr. Ron Porter is satisfied with the
7033
TEMPEST results.
7034
7035
And for some perspective, from the program management standpoint, the
7036
time period between the inspections and the final authority to operate
7037
or even the interim authority to operate was a span of months, which was
7038
weekly meetings of the program office, the contractor and Mr. Porter
7039
working off those discrepancies.
7040
7041
So from a program management point of view, for one, it was very
7042
difficult to work through this process and gain that ATO. And how we
7043
knew that we had done that was satisfied the requirements of Mr. Porter,
7044
the Coast Guard's TEMPEST certifying authority, sir.
7045
7046
LATOURETTE: Is it fair, because I don't operate in your world, but is it
7047
fair that when the ATO, the authority to operate was issued on these
7048
ships, that the TEMPEST test had been completed and the system was
7049
installed in a manner that was acceptable to the service?
7050
7051
JACOBY: Yes, sir.
7052
7053
LATOURETTE: And would acceptable to the service include a system that
7054
was leaking national security information out of its cables?
7055
7056
JACOBY: I would have to assume that the TEMPEST certifying authority
7057
would not grant an ATO if that was the case, sir.
7058
7059
LATOURETTE: And is that the case on all -- did you get ATOs on all eight
7060
ships?
7061
7062
JACOBY: Yes, sir.
7063
7064
LATOURETTE: Thank you.
7065
7066
Nothing else, Mr. Chairman.
7067
7068
CUMMINGS: Mr. Oberstar?
7069
7070
OBERSTAR: Mr. Ghosh, you were internally and integrally involved with
7071
the design. So who was primarily responsible for the design for
7072
lengthening the hull 110 to 123 feet?
7073
7074
GHOSH: In my opinion, sir, it's Bollinger, ICGS.
7075
7076
OBERSTAR: It was?
7077
7078
GHOSH: In my opinion, ICGS is the...
7079
7080
OBERSTAR: ICGS.
7081
7082
GHOSH: As the prime contractor and their support contractor, Bollinger.
7083
7084
OBERSTAR: What was your role in all of this? You're a naval architect,
7085
aren't you?
7086
7087
GHOSH: Yes, sir. But, again -- yes, sir, we got involved in the sense
7088
that when the design -- review of the design, but, again, Bollinger
7089
calculations showed that the required strength exceeds the calculations
7090
(inaudible) exceeds the (inaudible) by about 100 percent.
7091
But, also, I was the first person to contact Carderock and B.T. (ph) and
7092
Bollinger to get these people on board.
7093
7094
OBERSTAR: Now, you had conversations with, as we understand it, with
7095
Scott Sampson, who is a Navy employee at the Carderock facility, which I
7096
always call the David Taylor model basin, in September 2002, and Mr.
7097
Sampson warned the Coast Guard at that time of a likely design flaw.
7098
7099
Did you get detailed information about that?
7100
7101
GHOSH: Yes, sir. Before even then actually the 179 problem, the cracks
7102
on the 179, I knew about that.
7103
7104
And they are correct that that 179 was (inaudible) only 5 percent, but
7105
under 123, there was 12 percent. But there is a distinction between the
7106
length. The 110-foot versus 175-feet, that length difference makes this
7107
problem different.
7108
7109
In our analysis, (inaudible) analysis in the future, what we found, and
7110
we knew that for a small boat, the failure which the P.C. had is a
7111
yielding failure, meaning a steel has a yield strength of 40,000 pounds
7112
per square inch and the failure on the 179 P.C. was cracking due to
7113
tensile strength exceeding that 40,000 pounds.
7114
7115
But in our case, the 110, because of the short length, the failure is
7116
completely different. It's a buckling failure, which could be much
7117
lower.
7118
7119
Like in our Matagorda case, it was only at 7,200 pounds per square inch.
7120
So the two failures are completely different, and all the knowledge and
7121
ABS rules and the DNV rules, everybody suggested that like, for example,
7122
the DNV rules only apply to more than 150 feet length.
7123
7124
The ABS rules, the 1997 rules, which Mr. Scott Sampson mentioned, they
7125
didn't apply. In that rule it said that this buckling and all this
7126
(inaudible) needs to be done if it is more than 200 feet.
7127
7128
Subsequently, of course, ABS changed that rule in 2003 to 79 feet.
7129
7130
OBERSTAR: ABS changed the rule?
7131
7132
GHOSH: ABS changed the rule, yes, sir.
7133
7134
OBERSTAR: Now, did the Navy offer to provide design and engineering
7135
support for Bollinger, for Northrop Grumman and for the Coast Guard?
7136
7137
GHOSH: Yes, sir.
7138
7139
OBERSTAR: We understand that offer was declined.
7140
7141
GHOSH: Because I couldn't get the funding. I didn't have any funding.
7142
OBERSTAR: The funding was how much?
7143
7144
GHOSH: $42,000 (inaudible).
7145
7146
OBERSTAR: $42,000, did you say? Total cost, we understand, was somewhere
7147
between $50,000 and $60,000. This is a $90 million project?
7148
7149
GHOSH: Yes, sir.
7150
7151
OBERSTAR: They couldn't -- they, the Coast Guard, Commander Jacoby,
7152
couldn't find that money?
7153
7154
JACOBY: Respectfully, sir, this was two years before I joined the
7155
program. I can't really speak for whether they could find money or not,
7156
sir.
7157
7158
OBERSTAR: All right.
7159
7160
The Navy offered, and it was not going to do this free. They're going to
7161
do it on a cost-reimbursable basis, and the cost was in the range of
7162
$60,000 on a $90 million contract?
7163
7164
I don't understand this.
7165
7166
When did you, Mr. Ghosh, become aware of the deck cracking issue on the
7167
123s?
7168
7169
GHOSH: After September 2004, Matagorda.
7170
7171
OBERSTAR: At least six of the eight, by a year later, six of the eight
7172
converted ships had developed severe cracking. Is that correct?
7173
7174
GHOSH: It's not cracking, sir. There is cracking -- there are cracking
7175
in the aluminum deck, but the main problem has been the buckling on the
7176
side shells (ph) and current problem is buckling on the bottom and
7177
misalignment of shafts. We cannot keep the shafts aligned. And it's a
7178
much more complicated problem. Again...
7179
7180
OBERSTAR: You can have buckling without cracking.
7181
7182
GHOSH: Yes, sir.
7183
7184
OBERSTAR: I understand. I understand.
7185
7186
GHOSH: Because the stress level for the buckling is much, much lower.
7187
7188
OBERSTAR: Did you think it was useful to have the Navy advise the Coast
7189
Guard on this?
7190
7191
GHOSH: Well, the current problem, the way we have analyzed it, yes, of
7192
course, it would have been good, but that solution they would have
7193
presented at the time, like we have already done in our MOD-1 (ph),
7194
MOD-2 (ph) structures, we're having to (inaudible) as well as the
7195
buckling, in case the buckling (inaudible) its problems.
7196
7197
So it's a much more complicated problem than (inaudible).
7198
7199
OBERSTAR: You said something very interesting earlier in your statement.
7200
You were comparing strength of steel -- I know a good deal about steel,
7201
my district was very much involved in and I've spent a great deal of
7202
time on the steel industry. You talked about 14,000 pounds strength per
7203
square inch.
7204
7205
GHOSH: Forty thousand, sir.
7206
7207
OBERSTAR: Pardon me?
7208
7209
GHOSH: Forty thousand.
7210
7211
OBERSTAR: Forty thousand.
7212
7213
GHOSH: Yes, sir.
7214
7215
OBERSTAR: I misunderstood.
7216
7217
GHOSH: High strength steel.
7218
7219
OBERSTAR: Very high strength, yes. That's very good. And was it 7,200
7220
pounds per square inch?
7221
7222
GHOSH: Per inch, was the buckling failure, sir, yes.
7223
7224
OBERSTAR: So what was the specification for strengthening of the hull,
7225
if any, on the 123?
7226
7227
GHOSH: They are supposed to -- the contract -- supposed to look at this
7228
critical buckling strength, 7,200, but, again, the (inaudible) was so
7229
high, almost 200 percent (inaudible). So they didn't do any calculations
7230
(inaudible).
7231
7232
OBERSTAR: A previous witness in a previous panel said that this was not
7233
a problem at all, that the problem of hull buckling or cracking was due
7234
to an underlying stringer in the ship construction that was not attached
7235
and, therefore, did not provide strength and that the failure was due to
7236
something else, not to the design of the hull extension.
7237
7238
GHOSH: That is true. The Matagorda...
7239
7240
OBERSTAR: You mean true that there was a stringer...
7241
7242
GHOSH: Stringer not welded.
7243
7244
7245
OBERSTAR: Did that have a relationship to the strength of the hull?
7246
GHOSH: That stringer being not welded, the Matagorda failed at very low
7247
wave height, very low (inaudible). But eventually when we fixed the
7248
problem and increased the strength based on when we found the
7249
calculation mistake and we increased the strength, which Carderock would
7250
have suggested the same thing, still you had failure, and that failure
7251
is not due to just not having the welded stringer.
7252
It is much more complicated. And (inaudible) we have spent $0.5 million
7253
almost in trying to solve this problem with experts from Europe, the
7254
original designer (inaudible) and several (inaudible) we have done.
7255
7256
The main theory, what we think is that because the engine room hatch
7257
basically doesn't have the deck, it has a soft patch, (inaudible) that
7258
moved toward the mid-ship of the hull. And that also one other problem
7259
with these particular boats are (inaudible) different from a normal
7260
boat, a steel-hull boat always has steel deck, also, but the 110 and 123
7261
has aluminum deck.
7262
7263
Aluminum basically feels like rubber in this particular case. And that
7264
is like a canoeing, if you have open canoe. You can push it and it sort
7265
of buckles and that's what is happening.
7266
7267
We cannot prove it by (inaudible) analysis and we have gone through many
7268
experts. Nobody could pinpoint the exact failure (inaudible).
7269
7270
OBERSTAR: Why wouldn't that have shown up prior to actual construction
7271
work undertaken on the vessel? Why wouldn't there have been a design
7272
evaluation before you put the vessel to construction?
7273
7274
GHOSH: Well, the 110...
7275
7276
OBERSTAR: And, secondly, why in the strengthening, the lengthening and
7277
strengthening, why didn't someone notice the stringer wasn't attached?
7278
7279
GHOSH: The stringer was...
7280
7281
OBERSTAR: I don't understand that.
7282
7283
GHOSH: The stringer not attached was...
7284
7285
(CROSSTALK)
7286
7287
OBERSTAR: And was that endemic to the other vessels?
7288
7289
GHOSH: No, sir.
7290
7291
OBERSTAR: Just to this one.
7292
7293
GHOSH: Just that one. But, again, on the other hand...
7294
7295
OBERSTAR: But the others cracked -- the others buckled, call it that
7296
way.
7297
7298
GHOSH: Buckled. And the main problem right now is that we cannot keep
7299
our shafts aligned.
7300
7301
OBERSTAR: All right. So the testimony we got in the previous panel was
7302
-- not your words, but mine -- a cover-up for their failure.
7303
7304
When you received this information from the Navy and then you passed it
7305
on and recommended their guidance, and action was not taken because, in
7306
the Coast Guard's word, they didn't have the money to do this, did you
7307
have any further leverage in this arena? Were your hands tied at that
7308
point?
7309
7310
GHOSH: No, sir. We couldn't use our own money, plus we didn't have our
7311
money also, because (inaudible) projects, you have to have right
7312
(inaudible) of money to use it, you couldn't use mix and match.
7313
7314
OBERSTAR: All right, thank you, Mr. Chairman. I think that testimony is
7315
very helpful and sheds important light.
7316
7317
I'm going to come back and review this matter of steel strength and take
7318
a closer look at it later, not in this hearing, but in another context.
7319
7320
I appreciate that. It's very, very useful testimony.
7321
7322
CUMMINGS: Mr. Gilchrest?
7323
7324
GILCHREST: Thank you, Mr. Chairman.
7325
7326
Maybe if you wrote a letter to the Coast Guard auxiliary, they would
7327
have contributed that $40,000 for that extra evaluation.
7328
7329
Mr. Ghosh, you have, in your testimony, on page 3, I just want to read a
7330
couple of sentences, second paragraph: "I asked both contracting
7331
officers' technical representative and the Bollinger members of the
7332
technical management information team to award contracts to the Navy's
7333
Combatant Craft Division because of its experience with similar problems
7334
that occurred after lengthening the 179-foot patrol craft and its
7335
earlier involvement with the 110-foot Island class patrol boat.
7336
7337
"I also suggested that Bollinger consult Vosper Thornycroft because it
7338
was the original designer of the Island class patrol boat. I was unable
7339
to get support for this."
7340
7341
Who did you need to get support to have this done?
7342
7343
GHOSH: I would say the project office.
7344
7345
GILCHREST: Who was in the project office that didn't give you support
7346
for this?
7347
7348
GHOSH: Well, I was a member of the TMIT team and I could go there and I
7349
didn't go any further.
7350
7351
But, also, I would like to point out that even if we had gotten the
7352
support at the time (inaudible) suppose we had gone to Carderock at the
7353
time and they would have told us to (inaudible) and that's exactly what
7354
we have done today, but still the boat fails.
7355
7356
GILCHREST: So what I'm saying is you had some concern about design
7357
flaws, I guess, and you could not get support for a further evaluation
7358
for those proposed design flaws.
7359
GHOSH: No, sir. I didn't know there is design flaw. I just wanted them
7360
to look at the design because they have the experience, more than I did.
7361
7362
GILCHREST: Now, why were you not able to get support for this further
7363
evaluation?
7364
7365
GHOSH: I cannot speak for it. I didn't control the money.
7366
7367
GILCHREST: Who specifically was the person that turned you down?
7368
7369
GHOSH: I cannot remember exactly, but everybody in Deepwater program
7370
knew about that, that we wanted to get the money to...
7371
7372
GILCHREST: I'd just to -- Mr. Chairman, I'd like to follow up and find
7373
out who that person was that you suggested that you get this other
7374
information, and I think I'd just like to follow through down the road
7375
so that we can find out who that person or persons were.
7376
7377
I'd like to go to page 5 of your testimony, and it's the second from the
7378
last paragraph, about the middle way down. And I just want a
7379
clarification from you, Mr. Ghosh, that it seems, from what you say
7380
here, you now understand what caused the damage on the hull buckling on
7381
these ships.
7382
7383
"After analyzing all additional information, the Coast Guard's
7384
Engineering Logistics Center has developed a solution that might address
7385
all the possible mechanisms of damage. Add a stiff beam and a closed
7386
tube to the upper edge of the deck and I believe this will answer the
7387
major structural problems, but I cannot provide complete certainty that
7388
this will work or there won't be any other anticipated problems."
7389
7390
So what we're talking about here, what Mr. Oberstar is talking about,
7391
the hull breaches, the hull buckling and all of those issues, a stiff
7392
beam and a closed tube to the upper edge of the deck will solve some of
7393
those problems, possibly?
7394
7395
GHOSH: Possibly, sir, yes. The thing is that increasing the strength by
7396
just putting (inaudible) plates (inaudible) it didn't work. And what we
7397
have come to the theory about, (inaudible) was mentioning, if we have a
7398
closed cell, which is several hundred times stronger in torsion, and
7399
that will stabilize the deck.
7400
7401
GILCHREST: Now, we have eight ships sitting up at Curtis Bay, just
7402
outside of Baltimore City. If you think you might have a solution to
7403
this problem, should we scrap those boats or should we pick out one and
7404
see if it'll work?
7405
7406
GHOSH: Well, that's...
7407
7408
GILCHREST: That's not your decision to make?
7409
7410
(CROSSTALK)
7411
7412
GHOSH: ... because I do not have 100 percent guarantee. I mean, I cannot
7413
guarantee.
7414
7415
GILCHREST: I mean, considering all the money that's been put into this
7416
project, there's some pretty good workers up there at Curtis Bay. They
7417
might -- is it possible to hold the line, let's not scrap all these
7418
ships, let's see if we can salvage one, put it out on the high seas for
7419
a year. I'll sail down to McMurdo on it, if need be. Give me six months
7420
leave of absence, Mr. Chairman.
7421
7422
Are these ships so far gone that salvaging one and testing it out just
7423
isn't worth it?
7424
7425
GHOSH: No, sir, I agree. It can be -- I mean, you could do that, what
7426
you suggesting, sir.
7427
7428
GILCHREST: So this 110 -- these 110 boats, changed to 123, that's never
7429
been done before. This is the first time we took 110s to make them 123s?
7430
7431
GHOSH: Yes, sir.
7432
7433
GILCHREST: This is really a silly question, I guess. Considering all the
7434
potential problems that we're seeing here, both from Lockheed Martin and
7435
from Northrop Grumman, from the aviation, the logistics, the hulls and
7436
all that, would it not have been more prudent to do one, set it out
7437
there, because the first one entered service in '05, but there were
7438
already hull problems in '04 on that same boat, set it out there and see
7439
if you could get the kinks out?
7440
7441
GHOSH: Yes, sir. Yes.
7442
7443
GILCHREST: Did the Navy have similar problems when they went from 170 to
7444
179?
7445
7446
GHOSH: Not similar problems, sir. I just said that the stress level on
7447
the deck, they are seeing the 40,000 pounds per square inch level and
7448
ours is between (inaudible) in that range.
7449
7450
GILCHREST: You talked about solving one of these -- this will be my last
7451
question, Mr. Chairman.
7452
7453
What you talked about as far as add a stiff beam and a closed tube to
7454
the upper edge of the deck would have solved some of those damage
7455
problems with the 123.
7456
7457
Is there a similar design in the 179?
7458
7459
GHOSH: No, sir. They have -- again, because the problem (inaudible) they
7460
have increased the strength of the (inaudible) my solution, also,
7461
increasing the strength, but in our 123 case, just increasing the
7462
strength does not help or will not help. It has to have a closed cell
7463
because of the open deck.
7464
7465
In the P.C.s, though, they have some hatch, but by increasing the
7466
strength, that solved their problems. It was cracking in their case. In
7467
our case, it's mostly buckling.
7468
7469
GILCHREST: How many 110s are left in the Coast Guard?
7470
7471
GHOSH: Forty-one, sir.
7472
7473
GILCHREST: Are any of those going to be 123s?
7474
7475
GHOSH: No.
7476
7477
GILCHREST: Thank you, Mr. Chairman.
7478
7479
CUMMINGS: Just before we go to Mr. Kagen, let me just ask you this, Mr.
7480
Michel.
7481
7482
Given that you agreed with Mr. De Kort's concerns, do you believe that
7483
Lockheed Martin did anything unethical?
7484
7485
MICHEL: I wouldn't say unethical, sir, no.
7486
7487
CUMMINGS: Did you file an ethics complaint?
7488
7489
MICHEL: I did not, sir.
7490
7491
CUMMINGS: Mr. Kagen?
7492
7493
KAGEN: Thank you, Mr. Chairman.
7494
7495
I didn't know when I took this job we might be having sleepovers. I
7496
don't think I brought all my equipment.
7497
7498
CUMMINGS: At least you're a doctor. So if we get sick, you can take care
7499
of us.
7500
7501
KAGEN: That's right. But I'm not allowed to write myself those
7502
prescriptions.
7503
7504
Is it Dr. Ghosh, Ph.D.?
7505
7506
GHOSH: No, sir. I have just a bachelor's degree in (inaudible) from
7507
Indian Institute of Technology (inaudible).
7508
7509
KAGEN: With 33 years of experience in architecture related to naval
7510
vessels.
7511
7512
GHOSH: Yes, sir.
7513
7514
KAGEN: And were you here during the earlier testimony...
7515
7516
GHOSH: Yes, sir.
7517
7518
KAGEN: ... when I questioned Mr. Stanley?
7519
7520
7521
GHOSH: Yes, sir.
7522
KAGEN: And do you agree with his answers with regard to potential
7523
responsibility?
7524
7525
GHOSH: I would say, yes, sir.
7526
KAGEN: Is there anybody else that you think you should add to the list
7527
of three?
7528
7529
GHOSH: No, sir.
7530
7531
KAGEN: And with regard to the name of the person, either your superior
7532
or someone in your organization that may not have been able to come up
7533
with the money necessary to do some more studies, is it possible that
7534
you could find that person's name if not tonight, then in the next
7535
several days, certainly during my first term here?
7536
7537
GHOSH: It's been five years, sir. I didn't keep that good notes.
7538
7539
KAGEN: OK.
7540
7541
GHOSH: But, again, it was in a meeting and all names have been given.
7542
7543
KAGEN: All right. Well, can you offer perhaps three things that you
7544
think were the primary things that went wrong with the 110? Give me a
7545
list. I have a fact-based -- I have a scientific mind, but don't shake
7546
your hands, because when I teach medical students, when a professor does
7547
this, we put our notes down, don't write anything, because it's just a
7548
bunch of bull.
7549
7550
So just give me three things that you think were the key things that
7551
went wrong with this project.
7552
7553
Design. You mentioned the space in the hull, the hatch, so to speak.
7554
7555
Let me ask you, yes or no, can you come up with three things that you
7556
think were central to the failure of this project?
7557
7558
GHOSH: I guess I could.
7559
7560
KAGEN: Perhaps then you can write to me and give me my answers in
7561
writing at a later time.
7562
7563
Is it Mr. Michael (ph) or Mr. Michel?
7564
7565
MICHEL: It's Mr. Michel, sir.
7566
7567
KAGEN: Mr. Michel, you mentioned in your statement that you're assistant
7568
deputy for systems implementation with the Coast Guard's nationwide
7569
automatic identification system project.
7570
7571
MICHEL: Yes, sir.
7572
7573
KAGEN: I'm sure they don't answer the phone that way, but can you give
7574
me just a little background about what that means, what you do?
7575
7576
MICHEL: These days I'm more of a program management type than an
7577
engineering technical lead, but the two are closely related in my
7578
present responsibilities.
7579
7580
KAGEN: So someone in that organization depends on your judgment.
7581
7582
MICHEL: Yes, sir.
7583
7584
KAGEN: On your good judgment and your judgment is based not just on your
7585
education, but your training and your experience.
7586
7587
MICHEL: Yes, sir.
7588
7589
KAGEN: Is that correct? So you were involved in this project and let me
7590
ask you this. Do you agree with everything offered in sworn testimony by
7591
Mr. Atkinson?
7592
7593
MICHEL: I do not.
7594
7595
KAGEN: Is there anything that you disagree with him on?
7596
7597
MICHEL: I think that some of his statement were a bit of a stretch.
7598
7599
KAGEN: So the adjectives might be a problem, but what about the facts?
7600
Is it not a fact that some wiring and covering of wiring created the
7601
possibility, as you testified earlier this evening, for eavesdropping?
7602
7603
MICHEL: For compromising emanations, yes, sir.
7604
7605
KAGEN: And when you left the project, is it not also true that that same
7606
wiring was in place?
7607
7608
MICHEL: Yes, sir.
7609
7610
KAGEN: Do you think your judgment was sound in allowing it to continue
7611
to be present?
7612
7613
MICHEL: I made my concerns known during my tenure.
7614
7615
KAGEN: Well, you did talk about it, but what happened? What are the
7616
results? Don't read my lips. What do you think? Was it poor judgment to
7617
walk away from that project knowing that they were unshielded wiring?
7618
7619
MICHEL: Well, perhaps, sir, but it was a promotion.
7620
7621
KAGEN: OK.
7622
7623
Well, I'll tell you, I'm new around these parts and I think, Joe, you
7624
testified earlier that you thought there was really a contract problem.
7625
I don't think it's a contract problem. I think it's a people problem and
7626
it's really a problem of oversight.
7627
7628
And I can, as my time expires here, reassure you that the 110th Congress
7629
is intently interested in providing oversight. And in my evening that
7630
I'm spending here with you, there was one man who was honest thus far
7631
and that gentleman is sitting in the back row from Bollinger.
7632
7633
Marc 'fessed up. He accepted responsibility. And he's invited everybody
7634
else to accept responsibility.
7635
7636
If I may just ask Cathy Martindale a question.
7637
7638
Are you understaffed? Do you have a lot more responsibility to do
7639
personally than you think one person should be doing?
7640
7641
MARTINDALE: While assigned to the Deepwater project, yes, sir.
7642
7643
KAGEN: So how many other staff members do you feel would be adequate to
7644
get the job done right?
7645
7646
MARTINDALE: There should be an overarching surface contracting officer.
7647
There should be a contracting officer assigned to each asset. That would
7648
be the SRP, the 123, the NSC, the FRC, the OPC, that would be five
7649
contracting officers. And maybe they would need two to three specialists
7650
working for each of those contracting officers.
7651
7652
KAGEN: Is that not a staff of close to 18 in addition to you?
7653
7654
MARTINDALE: Yes, sir.
7655
7656
KAGEN: And who would be responsible for providing all that staff? Who's
7657
the decision-maker? Where does that buck stop?
7658
7659
MARTINDALE: I really don't know, sir.
7660
7661
KAGEN: See, one of the principles in my businesses that I've run is that
7662
if I give someone a job that they cannot do, shame on me.
7663
7664
Someone gave you a job that was humanly not possible, in my early
7665
estimation. Would you agree with that?
7666
7667
MARTINDALE: Yes, sir.
7668
7669
KAGEN: So it's a question, again, of failure of oversight. It's not a
7670
failure of contracts. I don't think this is necessarily a problem that's
7671
going to be solved by attorneys. It's going to be solved by this
7672
Congress in its oversight of activities, not just in the Coast Guard,
7673
but elsewhere.
7674
7675
Any other comments before I yield back my time from the panel?
7676
7677
MARTINDALE: I have a comment, sir.
7678
7679
KAGEN: Thank you.
7680
7681
MARTINDALE: I believe another issue of concern is the construct of the
7682
contractor. It's been a struggle in administering the contract when you
7683
have a joint venture, ICGS, which is a shell of a company, and then you
7684
have subcontractors, Lockheed Martin, Northrop Grumman Ship Systems, and
7685
then another tier subcontractor, Bollinger.
7686
Not necessarily those contract relationships reflect that of the Coast
7687
Guard's with ICGS, making it an additional challenge, and, also, the
7688
work was divided up. C4ISR was focused on doing their C4ISR work. HM&E,
7689
they were focused on doing their HM&E. And not necessarily when the two
7690
would come together did they work compatibly, and that was just a
7691
fallout of the organizational construct with whom we had a contract
7692
relationship.
7693
7694
KAGEN: You've just described a disorganized orchestra where everyone's
7695
playing their own musical instrument, but there's no conductor. So we
7696
have Madam Speaker Pelosi to guarantee there's going to be oversight in
7697
this Congress.
7698
7699
I yield back my time.
7700
7701
CUMMINGS: Thank you very much.
7702
7703
I just wanted to say that Admiral Blore, who's right over there, Ms.
7704
Martindale, is the guy who can get you some more help. OK?
7705
7706
Mr. Altmire (ph)?
7707
7708
ALTMIRE (?): Thank you, Mr. Chairman.
7709
7710
I wanted to clarify one thing. This is for Commander Jacoby. You talked
7711
earlier about Ron Porter and the visual TEMPEST exam of the Matagorda.
7712
7713
JACOBY: Yes, sir.
7714
7715
ALTMIRE (?): So my question is, was Ron Porter a fully certified TEMPEST
7716
authority at the time he conducted the visual TEMPEST exam of the
7717
Matagorda?
7718
7719
JACOBY: To my knowledge, he was, although I did not verify his
7720
certification, sir.
7721
7722
ALTMIRE (?): OK. Thank you.
7723
7724
Also, for you, Commander, according to records supplied by the Coast
7725
Guard, Matagorda received its interim authority to operate its C4ISR on
7726
October 14, 2004. It then had a visual TEMPEST inspection on December
7727
19, 2004, which noted a few lingering discrepancies. It received its
7728
authority to operate on January 19, 2005.
7729
7730
Next, the 123 class received a class waiver for visual discrepancies on
7731
July 12, 2005. Matagorda itself was reinspected for visual TEMPEST on
7732
October 28, 2005.
7733
7734
So the question is, why did Matagorda receive its ATO before the class
7735
waiver for the 123s' visual discrepancies was granted and before
7736
Matagorda was given a visual TEMPEST inspection to assess the condition
7737
of remaining discrepancies -- deficiencies? I'm sorry.
7738
7739
JACOBY: I tried to keep up with you on dates there, sir. I believe that
7740
there's a mixing of two issues there. The class-wide waiver, which
7741
applied to not the Matagorda, but the follow-on hulls, was granted, I
7742
believe, on the date you mentioned.
7743
7744
If I can just run through the Matagorda...
7745
7746
ALTMIRE (?): Please.
7747
7748
JACOBY: I think that would clear things up.
7749
7750
The Matagorda received a visual TEMPEST inspection and an instrumented
7751
TEMPEST inspection in the February of '04 time frame and received
7752
authority to operate, interim authority to operate in October of '04,
7753
and a final authority to operate in January of '05.
7754
7755
Those dates, in sequential order, I believe are the only ones applicable
7756
to Matagorda. The class-wide waiver, in my understanding, from what I've
7757
received from Mr. Porter, was after several cutters had been tested, his
7758
confidence level that the class met a configuration management standard
7759
that was consistent across the class, and he felt comfortable granting a
7760
class-wide authority to operate.
7761
7762
ALTMIRE (?): Thank you.
7763
7764
Then my final question, we pulled from the testimony and it has some
7765
acronyms in there which I'm going to try to pronounce correctly, but
7766
forgive me if I don't.
7767
7768
>From March 11 to April 5, 2005, Matagorda was among a group of ships
7769
reassessed by Navy's COMOPTEVFOR unit and the Navy wrote the following,
7770
which we were, I think, going to put up on the screen, but it's late
7771
now.
7772
7773
"TEMPEST discrepancies and COMSEC discrepancies were corrected in Coast
7774
Guard Cutter Matagorda. However, there were unsolved installation
7775
discrepancies which precluded a SPAWAR SYSCOM recommendation for Coast
7776
Guard 62 to release an IATO.
7777
7778
"Without an IATO, cutters were not authorized to transmit and receive
7779
classified information, significantly limiting their participation in
7780
U.S. Coast Guard tactical operations."
7781
7782
And then later they wrote, "In spite of this progress, physical
7783
connectivity was still assessed as a high risk based upon the inability
7784
to establish and maintain classified two-way data exchanges with other
7785
Coast Guard and naval vessels."
7786
7787
JACOBY: Yes, sir. It's my understanding that at the date in which
7788
COMOPTEVFOR, the Navy command, assessed the Matagorda, it did not have
7789
an ATO, therefore, could not energize their secure communications.
7790
7791
So COMOPTEVFOR noted that they could not test certain gear during that
7792
evaluation, and I believe the ATO for Matagorda came several weeks after
7793
COMOPTEVFOR had done their evaluation, sir.
7794
7795
ALTMIRE (?): And, Commander, had the Matagorda been handling classified
7796
information by this time?
7797
7798
JACOBY: No, sir.
7799
7800
ALTMIRE (?): They had not.
7801
7802
JACOBY: No, sir.
7803
7804
ALTMIRE (?): Why did the Coast Guard issue an ATO in January 2005 to the
7805
Matagorda when the Navy noted that unresolved installation discrepancies
7806
precluded SPAWAR from recommending the Coast Guard to release IATO when
7807
the system is still considered high risk at that time, March and April
7808
2005?
7809
7810
JACOBY: Sir, I believe there's two separate processes. The Navy's
7811
operational evaluation of the cutter is not linked to Mr. Porter's
7812
working with SPAWAR and determining the suitability of the TEMPEST
7813
system, sir.
7814
7815
ALTMIRE (?): OK. Last question. Thank you, Commander.
7816
7817
Did the sequence of events pose a risk of compromising national security
7818
at any time?
7819
7820
JACOBY: It has always been my belief, based on input from the C4
7821
community and the Coast Guard, that that is not the case.
7822
7823
ALTMIRE (?): Thank you, sir.
7824
7825
CUMMINGS: Tell me, again, when did the Matagorda get its ATO?
7826
7827
JACOBY: I show a final ATO granted on 19 January 2005, sir.
7828
7829
CUMMINGS: And was that before the Navy assessment?
7830
7831
JACOBY: I don't have the Navy report in front of me, sir.
7832
7833
CUMMINGS: March or April 2005. How does that affect your testimony?
7834
7835
JACOBY: I would have to check those dates, sir.
7836
7837
CUMMINGS: That's very, very important, because you just gave us some
7838
information that we want to make sure is accurate. And we can tell you
7839
that the information that we got, the Navy's examination was in March of
7840
2005.
7841
7842
JACOBY: Yes, sir. I believe what I'm reading off is something we've
7843
provided for the record. I'd be happy to provide this and the actual
7844
reports for the record, sir.
7845
7846
CUMMINGS: Very well.
7847
7848
Mr. Taylor?
7849
7850
TAYLOR: Thank you, Mr. Chairman.
7851
7852
Commander Jacoby, you were the project officer?
7853
7854
JACOBY: I was the program manager for the 123 program.
7855
7856
TAYLOR: On previous testimony, I heard the gentleman talking about
7857
electronics that were exposed to the weather, that weren't required to
7858
be waterproof, and I kept waiting for someone to say, "No, you're wrong.
7859
It was in the specs."
7860
7861
I still haven't heard anyone say that. How does something as basic as
7862
that happen? I mean, any boatsman who made third class is going to go,
7863
"The first time it rains, the first time we catch a wave, this stuff is
7864
ruined."
7865
How does something like that happen?
7866
7867
JACOBY: I agree with your assessment, sir, that that doesn't seem like
7868
something that could happen in reality. Coming on the program halfway
7869
through, I still know that the contract states environmental
7870
requirements for operation of the equipment and that a certain radio was
7871
installed on the SRP that did not meet those environmental requirements,
7872
sir.
7873
7874
TAYLOR: Were you empowered to catch mistakes like that?
7875
7876
JACOBY: It actually happened two years before I reported, sir, but yes.
7877
If I, as program manager, saw items that did not meet the contract
7878
requirements, I was empowered to work through the contracting officer
7879
and make corrections.
7880
7881
TAYLOR: So your predecessor program officer, was he a lieutenant, also,
7882
at the time? I'm taking it you were a lieutenant a couple years back.
7883
7884
JACOBY: The prior program manager, there were several. Some were GS-14s.
7885
And I'm not sure all the ranks of the previous.
7886
7887
TAYLOR: I realize that the Coast Guard throws, as all the services do, a
7888
heck of a lot of responsibility on very young officers. But it strikes
7889
me as something a program that $90 million expenditure, eight ruined
7890
cutters -- did you at any time sense that you just weren't high enough
7891
of a pay rate to address these problems?
7892
7893
JACOBY: Sir, I think I mirror Ms. Martindale's feelings of the program
7894
early on, the staffing levels were very bleak.
7895
7896
When I reported aboard, my billet was actually to be the deputy surface
7897
program manager with an overarching view of all the cutters'
7898
construction, and shortly after arriving, I saw the 123 program with a
7899
need for some change and some guidance.
7900
7901
I took that over in addition to the deputy surface job. After some
7902
months of work on the 123, it was clear that that was a full-time
7903
job-plus.
7904
7905
So in that timeframe of 2004, people were wearing two and three hats and
7906
moving the program forward. The commandant yesterday talked about
7907
increasing manning levels and oversight.
7908
7909
And I can attest, I witnessed over my two and a half years on the
7910
program the increase of staffing levels, and after a while, the people
7911
who were wearing three hats got replacements and were working -- before
7912
I left in October of 2006, we were properly manning each billet instead
7913
of asking people to cover two and three billets, sir.
7914
7915
TAYLOR: Again, I would invite you to correct me, but that one jumps out
7916
at me as so glaring that I find it inconceivable.
7917
7918
Now, let's take it to something a little bit more complicated, the
7919
hogging (ph) and sagging (ph) calculations.
7920
JACOBY: Yes, sir.
7921
7922
TAYLOR: Is that your normal expertise within the Coast Guard? If a crew
7923
boat company or a ferry boat operator were going to lengthen their
7924
vessel, is that the sort of calculation that you would run?
7925
7926
JACOBY: I'm not a naval architect or a marine safety inspector, sir, but
7927
I am a shipboard engineer for the Coast Guard, an engineer on two, sir,
7928
78-foot ships, and even engineer supporting the patrol boats down in Key
7929
West prior to my Deepwater career.
7930
7931
I, from a common sense standpoint, I think share your concern that that
7932
doesn't pass the common sense test, but I'm not a naval architect to
7933
back that up with calculations, sir.
7934
7935
TAYLOR: Commander, let me ask you this. And I very much appreciate your
7936
frankness.
7937
7938
What's being done so it doesn't happen again? I've told you my concerns
7939
with the LCS. I've told you my concerns with the next generation of
7940
cutters.
7941
7942
Shame on me if a mistake is made once, but shame on all of us, enlisted,
7943
officer ranks, members of the Congress, members of the administration,
7944
if we let this happen again.
7945
7946
And I really, based on what I've heard tonight, don't have any
7947
confidence that we're doing this any better. And what is particularly
7948
troubling, I'll tell you, I sense this is the shipboard equivalent of
7949
sweeping it under the rug.
7950
7951
When you cut this ship up for scrap, that it's no longer there to be on
7952
"60 Minutes," or if it's sunk offshore for a fishing reef, it's no
7953
longer there to be on "60 Minutes," we've got a real problem here.
7954
7955
JACOBY: Yes, sir.
7956
7957
TAYLOR: And I would like to hear from you as an up and coming officer in
7958
the United States Coast Guard that you've got a high degree of
7959
confidence that this is being addressed rather than just let's hope
7960
nobody asks that question again.
7961
7962
JACOBY: Yes, sir. I firmly believe that the factors that led to the
7963
structural issue, as well as the C4 issues we've talked about tonight, I
7964
could see the evolution of the things that will keep those from
7965
happening again in my two and a half years in the Coast Guard.
7966
7967
One of them was the manning level that we talked about, the wearing
7968
three hats. And I think there's been comparisons between Deepwater
7969
manning and Navy shipbuilding manning, and we were trying to build ships
7970
with very few people.
7971
7972
Another major contributor is the specificity of the requirement in the
7973
contract. In all these situations, we were dealing with contract
7974
language that was signed in 2002 and left the contractor and the
7975
government in many cases unclear on the exact requirements.
7976
It was a performance-based contract, but it still could have specificity
7977
that both the government and industry could use to manage costs, manage
7978
expectations, manage requirements.
7979
7980
Additionally, the oversight and the input from regulatory agencies, the
7981
commandant and the PEO have mandated the use of regulatory agencies in
7982
further designs, and I've personally been involved in incorporating the
7983
things that brought us problems on this contract, like specific words in
7984
the contract or lack of words in the contract, into future contracts for
7985
the FRC and the OPC.
7986
7987
So I do have a sense that I've contributed by the painful lessons
7988
learned to better contracts and better oversight and better manning for
7989
the Deepwater program, sir.
7990
7991
TAYLOR: If a contract passed your desk tomorrow that called for a radio
7992
or radar, fill in the blank, (inaudible) that's going to be exposed to
7993
the weather and did not mandate that it be waterproof, and we all know
7994
the difference between weatherproof and waterproof, would you be
7995
empowered to say, "Uh-uh, we're going to fix this right now," rather
7996
than buy two or three or four of these at government expense and replace
7997
the ones that don't work?
7998
7999
JACOBY: Absolutely, sir, and I do have examples of issues that arose on
8000
the Deepwater program that the program office felt did not meet the
8001
contract requirements and were able to enforce those requirements and
8002
get design changes and even retrofits on the cutters.
8003
8004
So there are examples of successes in enforcing the contract
8005
requirements and then there's examples of the program office
8006
unsuccessfully enforcing, mostly because of the wording that was
8007
incorporated into the contract in 2002, either vague or lacking the
8008
specificity.
8009
8010
TAYLOR: Who, in your opinion, should have caught the hogging (ph) and
8011
sagging (ph) problem before it happened?
8012
8013
JACOBY: The Coast Guard's contractors with ICGS. I feel the
8014
responsibility lie with ICGS. In fact, I issued or worked with my
8015
contracting officer to issue two late and defect letters to the
8016
contractor, one days after the Matagorda buckling incident and the other
8017
several months later when the deformations appeared on other cutters.
8018
8019
TAYLOR: Thank you very much, Commander.
8020
8021
JACOBY: Yes, sir.
8022
8023
TAYLOR: Thank you, Mr. Chairman.
8024
8025
OBERSTAR: I have a follow-up for Mr. Jacoby.
8026
8027
In January of '05, Matagorda got authority to operate, meaning that they
8028
also had authority to transmit and receive classified data.
8029
8030
But at that time, according to all the testimony we've seen, they had
8031
not yet passed the instrument test -- or instrumented test, as it's
8032
called.
8033
8034
The only instrument test which allegedly was passed was in July '06, but
8035
for another ship in the same class as the Matagorda.
8036
8037
Was it legal for the Matagorda to operate under those circumstances?
8038
8039
JACOBY: I believe so and I'll tell you, from my perspective, why I
8040
believe that, sir. The two instrumented TEMPEST inspections, one on
8041
Matagorda, one on Padre, were not related. The Padre inspection was not
8042
meant to validate Matagorda's TEMPEST system.
8043
8044
The original instrumented TEMPEST inspection on Matagorda, which you
8045
referred to as failed, was, in my view as a program manager, Ron Porter
8046
assessed the vulnerabilities or issues with that.
8047
8048
Over time, the physical discrepancies were corrected or Mr. Porter
8049
waived the discrepancies that were noted. And that original TEMPEST
8050
inspection was eventually the basis for Mr. Porter approving an
8051
authority to operate, sir.
8052
8053
OBERSTAR: Well, how does that authority compare to the judgment of the
8054
Navy, which said, in a document we have, that the system is still high
8055
risk?
8056
8057
JACOBY: That is from a COMOPTEVFOR report, sir? I believe that the
8058
authority for TEMPEST certification lies with, for the Coast Guard, Mr.
8059
Ron Porter, for the Navy, SPAWAR, and not with COMOPTEVFOR, sir.
8060
8061
I can't speak to whether they would determine...
8062
8063
OBERSTAR: There's this gray area here which is now becoming somewhat
8064
clearer that there were deficiencies, and these deficiencies were
8065
granted waivers instead of being repaired, rather than being covered up.
8066
8067
JACOBY: I do not know the waiver process or the mentality that goes
8068
behind the waiver process at Mr. Ron Porter's shop.
8069
8070
OBERSTAR: Thank you. We need to proceed on to the next panel.
8071
8072
I particularly want to thank Mr. Ghosh, the naval architect, for his
8073
very candid and straightforward and helpful answers.
8074
8075
CUMMINGS: I want to thank you all very, very much for being with us. And
8076
your testimony has been extremely helpful.
8077
8078
We'll call the next panel now. Rear Admiral Gary T. Blore and Vice
8079
Admiral Paul E. Sullivan.
8080
8081
(WITNESSES SWORN)
8082
8083
CUMMINGS: Thank you. You may be seated.
8084
8085
Rear Admiral Blore?
8086
And thank you all very much. I know it's been a very, very long day.
8087
Hopefully, we will not take you into tomorrow.
8088
8089
BLORE: Thank you, sir, and the members who have stuck it out with us.
8090
8091
Good evening, Mr. Chairman and distinguished members of the committee.
8092
It's a pleasure to be here today with my colleague, Admiral Sullivan. I
8093
respectfully request my previously submitted written testimony be
8094
entered into the record.
8095
8096
CUMMINGS: Without objection, so ordered.
8097
8098
BLORE: I'd like to thank the Congress, in particular, this committee,
8099
for your oversight of the Integrated Deepwater System. We have adopted
8100
many of your committee recommendations as we reform the Deepwater
8101
acquisition process.
8102
8103
I believe the Deepwater program is our best strategy for building a 21st
8104
century Coast Guard capable of executing our missions of maritime
8105
safety, environmental protection, homeland security and homeland
8106
defense.
8107
8108
As part of our effort to strengthen the Deepwater program and with the
8109
commandant's leadership, we have met extensively with Integrated Coast
8110
Guard Systems, or ICGS, Lockheed Martin and Northrop Grumman.
8111
8112
We have had frank discussions with industry about our intentions moving
8113
forward. We have strengthened the Coast Guard's acquisition process and
8114
revamped our procedures to ensure that the contract expectations of the
8115
Coast Guard and the American taxpayer are crystal clear.
8116
8117
This hearing is focused on mistakes the Coast Guard made in our first
8118
Deepwater shipbuilding project. Not a day goes by that I am not fully
8119
committed to avoiding a recurrence of this disappointment.
8120
8121
Our Coast Guard men and women deserve better, as does the public we
8122
serve.
8123
8124
You have my assurance that I will take every step necessary to redress
8125
insufficiencies in analysis and communications that led to the premature
8126
decommissioning of the 123-foot patrol boats.
8127
8128
However, we must not fall victim to living in the past, which neither
8129
recapitalizes the Coast Guard nor serves the public interest.
8130
8131
Instead, we must apply lessons learned to ensure a successful future for
8132
the Coast Guard, our acquisitions, homeland security and the American
8133
people.
8134
8135
The Coast Guard has options in choosing from whom to acquire our assets,
8136
consistent with the Federal Acquisition Regulations.
8137
8138
With the commandant's support, I intend to use robust business case
8139
analysis, competition and best value criteria in choosing which
8140
manufacturers will execute our projects.
8141
8142
In many cases, that may continue to be Lockheed Martin and/or Northrop
8143
Grumman, and to that end, the commandant and the companies' CEOs
8144
recently signed an agreement asserting the Coast Guard would transition
8145
into becoming the systems integrator, lead management of all life-cycle
8146
logistics, expand the use of the American Bureau of Shipping, accelerate
8147
the resolution of remaining national security cutter issues, and, where
8148
practicable, work directly with the prime vendors.
8149
8150
These actions, combined with numerous other acquisitions and program
8151
management reforms, will make the Deepwater program of tomorrow
8152
fundamentally better than the Deepwater program of today.
8153
8154
This committee has been a catalyst for much of this change, but the
8155
fundamental underpinnings of this reform began the day Admiral Allen
8156
became commandant just under a year ago.
8157
8158
His first, very first new initiative as our commandant was to direct the
8159
consolidation of our acquisition organization. Shortly thereafter, he
8160
adopted the "Blueprint for Acquisition Reform," which called for a
8161
restructuring and prioritization of our agency's entire acquisition
8162
process.
8163
8164
We will stand up this new structure beginning July 13 and it will take
8165
shape fully over the next several months.
8166
8167
For the upcoming award term, which starts this June, the commandant has
8168
asked me to focus on more favorable government terms and conditions and
8169
on those priority delivery task orders occurring during the first 18 to
8170
24 months.
8171
8172
This allows the recapitalization of the Coast Guard to continue unabated
8173
while acquisition reforms are implemented, at the same time, allowing a
8174
full spectrum of options for future government purchases.
8175
8176
Today marks the start of my second year in this assignment. Critical to
8177
our acquisition is the partnership we have built with our sister
8178
service. The Navy is our third-party independent assessor of choice.
8179
They speak Coast Guard, they understand us, and have superb engineering
8180
and technical expertise to share.
8181
8182
For example, a quarter of my resident project office staff at the
8183
Pascagoula shipyard is on loan from NAVSEA on a reimbursable agreement.
8184
Our daily contact is across dozens of NAVSEA's divisions involving
8185
millions of dollars transferred from everything such as Navy-type,
8186
Navy-owned equipment to technical review.
8187
8188
And now with the elevated role of our Coast Guard technical authority,
8189
the relationship with NAVSEA is even more integrated.
8190
8191
In conclusion, a properly equipped Coast Guard is critical to our nation
8192
and reforming the Deepwater acquisition is critical to a 21st century
8193
Coast Guard.
8194
8195
I look forward to working with you to ensure we can accomplish
8196
acquisition reform without derailing recapitalization, but while
8197
focusing on the acquisition fundamentals of cost control, schedule
8198
integrity and the surpassing of performance expectations.
8199
8200
Thank you, Mr. Chairman. I would be pleased to answer your questions.
8201
8202
CUMMINGS: Thank you very much.
8203
8204
Vice Admiral Sullivan?
8205
8206
SULLIVAN: Good evening, Mr. Chairman, and thanks for having us here
8207
tonight. My name is Vice Admiral Paul Sullivan. I'm the commander of the
8208
Naval Sea Systems Command.
8209
8210
Before I had the job I have today, I was the deputy commander for ship
8211
design, integration and engineering. I've also been a program manger of
8212
two submarine acquisition programs.
8213
8214
I'm here to discuss our partnership with the Coast Guard with regard to
8215
acquisition and, also, technical authority, and I'd be happy to answer
8216
any of your questions, sir.
8217
8218
CUMMINGS: Very well. Thank you very much to both of you.
8219
8220
Rear Admiral Blore, yesterday -- first of all, I want you to know that I
8221
think everybody on our panel on both sides of the aisle have tremendous
8222
confidence in Admiral Allen. He has clearly been a man of action and he
8223
has made it clear that he is going to make some significant changes.
8224
8225
I had an opportunity to review his statement yesterday, his press
8226
statement, and I was very impressed and was glad that he was moving in
8227
the direction he's moving in.
8228
8229
That being said, you've heard the testimony today. And I think we can
8230
actually start with Ms. Martindale, when she talks about the fact that
8231
she's -- and she seems to be a very diligent and hardworking employee,
8232
contracting officer, giving it the best she's got, not enough people.
8233
8234
I mean, I don't think that she was trying to make you all look bad.
8235
She's just answering questions honestly.
8236
8237
We've heard testimony throughout about how it appears that there are
8238
problems with having the personnel to do the TEMPEST test and the
8239
resources to properly do them.
8240
8241
So while we listen and we hear, and I could go on and on, you've heard
8242
the testimony, but it's clearer to me and it's a worry that I've
8243
expressed to Mr. Oberstar on at least two occasions, if not more, that
8244
we've got to make sure that if the Coast Guard is taking on these
8245
responsibilities, that they have the personnel, the expertise and the
8246
resources to take them on.
8247
8248
I mean, that, to me, if we don't -- if that's not the case, then I think
8249
that we move from one bad situation to another bad situation.
8250
And so I'm just wondering where does that stand.
8251
8252
I'll be very frank with you. At this moment, just based upon what I've
8253
read and what I've heard, I don't know that the Coast Guard is in a
8254
position to do certification with regard to TEMPEST. I'm not sure.
8255
8256
8257
And so -- and there are a lot of other things I'm concerned about.
8258
CUMMINGS: That's not beating up on the Coast Guard because we want to be
8259
the Coast Guard's number one advocates, but we also want to make sure
8260
that the Coast Guard has what it needs.
8261
8262
And so, taking into consideration what was said by the admiral
8263
yesterday, are we prepared to take on that responsibility?
8264
8265
BLORE: Yes, Mr. Chairman. I believe we are.
8266
8267
I share your respect for Ms. Martindale, and I would like to hire her
8268
back as a contracting officer for the Deepwater program, if she would
8269
like to return and join us.
8270
8271
Since I became the program executive officer a year ago, we've brought
8272
on about 45 new staff positions. That was the first increment that the
8273
commandant and I had worked out together as we started preparing to
8274
build out our system integrator capability.
8275
8276
I would not disagree with you for a moment that we're not prepared
8277
tomorrow to take over entirely the system integrator role. The
8278
commandant has a plan to transition. We are much more capable on the
8279
logistics and the materiel side of the Coast Guard. We still need to do
8280
a lot of build-out, especially on our C4ISR side, and I will be
8281
depending on my colleague heavily and other government sources to assist
8282
the Coast Guard with that.
8283
8284
Right now, we have 22 contracting officer billets within the program. We
8285
have expanded that since Ms. Martindale left.
8286
8287
Again, for full disclosure -- and I believe NAVSEA probably shares this
8288
issue -- while I have 22 contracting officer positions, I don't always
8289
have 22 contracting officers. Hiring in the Washington, D.C., general
8290
area for what's called an 1102, general schedule person, is difficult,
8291
especially at the junior classification rates, although we work on that
8292
very hard, again with our colleagues.
8293
8294
And we will continue to use SPAWAR as a facility to run our TEMPEST
8295
testing. I think some of the confusion earlier is we've always used them
8296
for the instrumented testing. The actual certification is done by a
8297
Coast Guard official, and that's why sometimes it may have been
8298
confusing who was doing the certification. TEMPEST, for Coast Guard
8299
assets, is certified by the Coast Guard based on SPAWAR testing.
8300
8301
CUMMINGS: Let me ask you this. In the admiral's statement yesterday, he
8302
said something that, while it impressed me and it made me feel good, it
8303
also left me kind of slightly with question marks.
8304
8305
He said the Coast Guard will expand the role of the American Bureau of
8306
Shipping or other third parties, as appropriate, for Deepwater vessels
8307
to increase assurances that Deepwater assets are properly designed and
8308
constructed in accordance with established standards.
8309
8310
What does that mean, if you can tell me?
8311
8312
In other words, one of the things that we have run into here with regard
8313
to TEMPEST is what is the standard. I mean, is the standard a moving
8314
target? Is the standard something that can be waived and whatever?
8315
8316
But putting TEMPEST aside, let's just deal with the American Bureau of
8317
Shipping. I mean, in talking to all of our experts, they tell me if we
8318
adhere to their standards, we'd be in pretty good shape, very good
8319
shape, and I'm wondering does this statement mean that that is the
8320
standard that we will be using, or what does this mean?
8321
8322
BLORE: Do you mind if I just ask Admiral Sullivan to comment on
8323
TEMPEST...
8324
8325
8326
CUMMINGS: Sure. Please. Please.
8327
(CROSSTALK)
8328
8329
BLORE: ... because we try to pattern off his program?
8330
8331
CUMMINGS: No, I'm happy to, happy to. Whoever is best to explain it.
8332
8333
SULLIVAN: Yes, sir, Mr. Chairman.
8334
8335
When you're building a ship or any complex system, there obviously has
8336
to be a standard that that ship or system is built to, and either the
8337
service can maintain a set of standards that you design and construct
8338
the ship in accordance with those standards and then you certify that
8339
ship, that it has been built to the design that meets the standards, the
8340
third-party aspect can either be handled by the service or by this third
8341
party, such as American Bureau of Shipping.
8342
8343
In the case of -- we have, in the Navy, been partnering with ABS. We
8344
have had a situation where we were unable to maintain our own standards
8345
due to lack of funding. We partnered with the ABS and developed a new
8346
set of standards that are not ABS standards. They're Navy-ABS
8347
partnership standards called the Naval Vessel Rules, and we've had a lot
8348
of discussion in Mr. Taylor's committee on what that meant to the LCS
8349
program.
8350
8351
But they are the rules to which you certify the ship. Either the service
8352
can perform that certification by an examination inspection, looking at
8353
paper, signatures -- objective quality evidence, we call it -- to ensure
8354
itself that the ship has been certified to those standards, or we can
8355
actually hire the third party, which, in this case, is the American
8356
Bureau of Shipping, to we call it class the ship by examining first the
8357
design and make sure the design meets the standards and then by
8358
inspecting the ship as it's being constructed and certifying that the
8359
ship was built in accordance with the design which met the class
8360
standard.
8361
8362
CUMMINGS: So who would do, say, the third-party certification of things
8363
like -- the systems like such as electronics? Who would do that?
8364
8365
SULLIVAN: Yes, sir. And ABS does not have experience to do that. So, for
8366
naval ships, as Admiral Blore said, the Space and Naval Warfare Systems
8367
Command, otherwise known as SPAWAR, they would do that certification for
8368
the Navy.
8369
8370
CUMMINGS: Good.
8371
8372
Admiral Blore, can you guarantee that none of the problems found on the
8373
123s will be repeated on the NSCs?
8374
8375
BLORE: Mr. Chairman, I can guarantee you that when we discover them,
8376
we'll address them individually and correctly, and we'll communicate and
8377
we'll do the analysis necessary so that we knowingly walk into the
8378
future.
8379
8380
I'm not going to suggest for a moment that a platform as complex as the
8381
National Security Cutter isn't going to encounter issues. I have 20 or
8382
22 right now that I look at in my level. But we address each one. We
8383
address the risk. We address the potential consequences. We work with
8384
our colleagues primarily at (inaudible) Ships down in Pascagoula and
8385
eliminate them as discrepancies.
8386
8387
CUMMINGS: Are you anticipating, I mean, other than beyond what you just
8388
said, are you anticipating those problems similar to the 123s in any
8389
way?
8390
8391
BLORE: Absolutely not. The National Security Cutter will be the finest
8392
Coast Guard cutter we have ever had. It will be more capable. We're
8393
working through all the issues, and we're doing it before we accept
8394
delivery of the cutter.
8395
8396
CUMMINGS: Thank you. That's helpful.
8397
8398
Is that a new way of doing business?
8399
8400
BLORE: I think Congressman Taylor would say it's the only way of doing
8401
business. It's the way we should have always been doing it, to work out
8402
these things before the government accepts final delivery.
8403
8404
I'm not suggesting that in almost probably every case when you do a
8405
DD250 and accept custody there's going to be some discrepancies, but
8406
there should be no major high-risk discrepancies that you're accepting
8407
when the government takes ownership.
8408
8409
CUMMINGS: Thank you.
8410
8411
As far as low-smoke cabling, is that used in the NSC?
8412
8413
BLORE: Yes, sir.
8414
8415
CUMMINGS: Is it meeting specifications?
8416
8417
BLORE: Yes, sir, but there is similar issues to what we discussed before
8418
in that one of the tenets of the Deepwater program -- and I think it's a
8419
good tenet -- is to attempt to use commercial off- the-shelf equipment
8420
when it's appropriate.
8421
8422
So we have a lot of the little like the mouse cable to the computer, a
8423
water fountain that just does not come with low-smoke cabling. It is
8424
possible for the government to request that all to be switched out, but
8425
we don't think anybody is at any degree of risk because of a couple of
8426
feet of cable.
8427
8428
When it's longer -- for example, the main mount, the 57- millimeter,
8429
came with non-low-smoke cable -- we asked the manufacturer to switch
8430
that out before we installed it because it was a pretty long run.
8431
8432
CUMMINGS: You've heard the testimony with regard to these waivers. Do
8433
you think that the Coast Guard appropriately waived in the past, and is
8434
there any change -- do you see any changes with regard to waivers in the
8435
future?
8436
8437
One of the concerns, I mean, if we look at it, it seems to me that --
8438
and I heard the testimony of some earlier witnesses about how there were
8439
certain things that connected to telephones and things of that nature,
8440
wires -- but it seems to me we would try to be in front of all of that
8441
so that, you know, it lessens the disputes. And I'm just wondering, are
8442
there any lessons learned with regard to waivers?
8443
8444
And you know what happens. When we hear about waivers, we begin to think
8445
that, "Well, is somebody trying to get around the provisions of the
8446
contract?" And when you talk about low-smoke cabling, then it sends up,
8447
I mean, bright lights and alarms because we're concerned that your
8448
personnel might be harmed in case of an emergency.
8449
8450
So I'm just wondering are there any lessons learned with regard to these
8451
waivers?
8452
8453
BLORE: Yes, sir. I think there's a lot of lessons learned, but let me
8454
just speak to one of them because I think it's probably the singularly
8455
most significant event in the way we conduct the Deepwater program now.
8456
8457
When Deepwater was first organized, it was basically our organic
8458
organization. Everything was contained within it, we did our own
8459
logistics -- this is going back to 2002, 2003 -- and it became somewhat
8460
isolated. It originally started with only 75 government personnel.
8461
8462
We're much larger than that now. We have formally established the role
8463
of our technical authority, which is Admiral Dale Gabel, which is, in
8464
essence, a smaller version of NAVSEA that we have within the Coast
8465
Guard, and we have another admiral, Dave Glenn, who functions in the
8466
same role for C4ISR.
8467
I'm not an engineer. Even the engineers will offer different opinions
8468
occasionally, some of which you've heard today.
8469
8470
The beauty of the current system is I don't try to sort that out. I go
8471
to the chief engineer of the Coast Guard and say, "What would you like
8472
me to do?" Or I go to the chief C4ISR admiral in the Coast Guard and
8473
say, "What would you like me to do?" Because in the end it's their
8474
opinion that I'm going to value and follow.
8475
8476
So I think that's the most significant thing. If the chief engineer of
8477
the Coast Guard said that we should accept a waiver on something, I
8478
would certainly discuss it with him to make sure I understood what his
8479
rationale was, but that's why he was appointed in that position for the
8480
commandant and the same thing on the electrical side.
8481
8482
CUMMINGS: Now will you send the cutter one to the Navy? What do you call
8483
it -- COMOPTEVFOR? Is that how you pronounce it?
8484
8485
BLORE: Yes, sir. COMOPTEVFOR. It's Commander Operational Test Forces.
8486
8487
CUMMINGS: Will you do that? In other words, are you going to send them
8488
to that center for the same analysis that was performed on the 123s?
8489
8490
BLORE: Yes, sir. In fact, we've established about a huge staff of eight
8491
Coast Guard men and women that are actually assigned to COMOPTEVFOR that
8492
work with the larger staff that's there so that we can help advise the
8493
testers and evaluators with COMOPTEVFOR of what the Coast Guard unique
8494
requirements are, and the Coastees are actually assigned there full time
8495
and sit next to our Navy and Marines colleagues.
8496
8497
CUMMINGS: Now, the Defense Acquisitions University recommends that the
8498
Coast Guard should convene a summit of the Coast Guard integrated team
8499
and the Navy to examine all opinions about fatigue life on the NSCs.
8500
Will you convene that summit?
8501
8502
BLORE: Yes, sir. I actually hired Defense Acquisition University to come
8503
in and do that analysis because we wanted to get the opinion of
8504
acquisition professionals on our acquisition policy. As you know, they
8505
gave us a good number of recommendations which we're incorporating.
8506
8507
We've already had that summit. We worked with the Carderock Division of
8508
NAVSEA, and we've actually worked out a technical solution now with
8509
Northrop Grumman. It's not on contract yet. It should be on contract by
8510
the end of this month.
8511
8512
It's typically referred to in the Coast Guard as the one-break solution,
8513
but it assures the fatigue life of the National Security Cutter of
8514
30-plus years.
8515
8516
CUMMINGS: Now, what measures will now be taken to increase the role of
8517
the Navy in testing the C4ISR security and assessing the effectiveness
8518
of the ship designs and improving the management of the Deepwater
8519
contract?
8520
8521
BLORE: Well, specifically for C4ISR, Mr. Chairman, we are trying to
8522
build our own Coast Guard organic capability a little bit more. It's
8523
going to probably take us 18 months before we have our own evaluators
8524
within the Coast Guard.
8525
8526
In the meantime, we're completely dependent on NAVSEA for any of the
8527
instrumentation and testing. We certainly have some expertise in the
8528
Coast Guard, but it's certainly not our intention to go it alone for
8529
C4ISR. That will be an area in particular that will be heavily dependent
8530
on Admiral Sullivan and others.
8531
8532
CUMMINGS: The Defense Acquisitions University's report suggests that the
8533
acquisitions excellence in business competencies are not valued in the
8534
Coast Guard as much as operational excellence. Can you comment on this
8535
finding, and what will you do to cultivate acquisitions and financial
8536
management expertise among your personnel?
8537
8538
And I want to go back to something that, I think, the commander said
8539
when he talked about -- and this has come up in other hearings -- that
8540
capacity to have contracting officers, folks who have expertise in
8541
putting together these contracts.
8542
8543
Because I think Admiral Allen has admitted, along with many others, that
8544
part of the problem with this contract is that a lot of the provisions
8545
are not necessarily in our best interests, and some place us in a
8546
position where they just call out for dispute because there are some
8547
ambiguities.
8548
8549
And perhaps we could have resolved a lot of this -- and I think Ms.
8550
Martindale may have mentioned it, too -- if we had had the experienced
8551
contract folks involved in the process of creating a contract that was
8552
more balanced and certainly in the best interests of the Coast Guard and
8553
the American people.
8554
8555
BLORE: I agree with what you just stated, Mr. Chairman. We have a type
8556
of contract that probably requires the most sophisticated expertise in
8557
contracting officers as opposed to a contract that has a lot more
8558
specifications.
8559
8560
That is why we're changing the terms and conditions as we go into the
8561
next award term. And we really do believe that the contract is the key,
8562
which is why we want to work on the terms and conditions and at least
8563
enough specificity that while it's still a performance-based contract,
8564
there's enough specificity so there's no misalignment with what we
8565
expect from industry.
8566
8567
CUMMINGS: Mr. LaTourette?
8568
8569
LATOURETTE: Thank you very much, Mr. Chairman.
8570
8571
Admiral Blore, in your written testimony, you state, at no time did the
8572
123-foot patrol boats engage in mission operations without first
8573
successfully completing standardized testing. Does that mean that at no
8574
time did these vessels operate without the authority-to- operate
8575
designation?
8576
BLORE: Sir, to the best of my knowledge, they've never transmitted on a
8577
classified frequency or received on a classified frequency without the
8578
correct authority to operate.
8579
8580
These cutters have commanding officers. They know when they have an
8581
authority to operate. They will and have in the past gotten underway and
8582
not energized any of their secure gear because they didn't have the
8583
authority to operate.
8584
8585
I can also say as part of my sworn testimony that I have never been made
8586
aware of any compromise that has ever occurred off a 123- foot cutter.
8587
We are also, the Coast Guard, a member of the Intelligence Committee,
8588
and neither has my chief of intelligence of the Coast Guard ever
8589
notified me that there's been a detected compromise from a 123-foot
8590
cutter.
8591
8592
LATOURETTE: And to both admirals, the chairman talked about waivers, and
8593
we've spent a good portion of the hearing talking about TEMPEST and
8594
TEMPEST testing and waivers. Is it unusual for waivers to be granted in
8595
the TEMPEST testing program either in the Coast Guard or in the Navy?
8596
8597
SULLIVAN: It's not unheard of, but it's not common.
8598
8599
LATOURETTE: Admiral Blore?
8600
8601
BLORE: I really don't think I know the answer to your question. I'm
8602
sorry. It certainly appears to have happened in the 123. I'd be happy to
8603
submit something for the record and go through the rest of our cutters
8604
and see whether they have any waivers.
8605
8606
LATOURETTE: If you could. And as a follow-up -- and if you can't answer
8607
this today, maybe you can get back to me, too -- but, Admiral Sullivan,
8608
if you know -- can these waivers ever be granted if there's a risk that
8609
national security will be endangered?
8610
8611
SULLIVAN: I think I would rather take that for the record so I could
8612
pass it to the proper people. I'm more the ship engineering guy than the
8613
C4ISR.
8614
8615
LATOURETTE: OK.
8616
8617
And, Admiral Blore, maybe if you could get back to us on that one as
8618
well.
8619
8620
Admiral Blore, yesterday, in the commandant's statement, he made, I
8621
thought, three insightful and succinct points that led us to that point.
8622
8623
He stated that the Coast Guard relied too much on contractors to do the
8624
work of government as a result of tightening AC&I budgets, a dearth of
8625
contracting personnel in the federal government, and a loss of focus on
8626
critical government roles and responsibilities in management and
8627
oversight of the program.
8628
8629
I think the principles that he laid out clearly address the third item.
8630
But relative to the contracting officers, I think it would be my
8631
observation that contracting officers, like Ms. Martindale, don't fall
8632
from the sky, and I heard you -- one of my questions was does the
8633
service have the ability to do that today, and I think you said no, and
8634
I think you said something about 18 months. Maybe I'm mixing your
8635
answers.
8636
8637
But can you just share with us how many of these experts the Coast Guard
8638
thinks it needs to hire to adequately do the job and how the service
8639
plans to identify and hire these folks?
8640
8641
BLORE: Yes, sir. I believe currently we have sufficient contracting
8642
officer positions, the 22 that I alluded to before. I think currently,
8643
right now, we have 17 filled, so I'd like to bring that up to
8644
complement.
8645
8646
There are a couple things that the Office of Personnel Management is
8647
allowing us to do now. We can do what's called direct hires. So, if I
8648
find somebody that's fully qualified, I can basically offer him a job on
8649
the spot, if they're qualified to be a government contracting officer.
8650
So that has helped.
8651
8652
We've also had a shift in processes where we're using our contracting
8653
officers in the field more than we did originally with the Deepwater
8654
program. For example, I have a contracting officer in Elizabeth City at
8655
the Aircraft Repair and Supply Center, and I'm doing a lot of the spare
8656
parts purchases for the CASA and also through Eurocopter for the H-65
8657
helicopter through the facility at AR&SC.
8658
8659
We're starting to set up the same thing -- I have a contracting officer
8660
that's about to be warranted -- in Pascagoula so that much of the
8661
contracting work can be done on site, which I think is, frankly, the
8662
Navy model where contracting officers are typically on site where the
8663
construction is taking place.
8664
8665
LATOURETTE: And my last question, Mr. Chairman, the first panel -- and I
8666
know, Admiral Blore, you were in the room for the first panel -- and I
8667
think I've tried to boil down the essence of the allegation that was
8668
made.
8669
8670
The allegation that was made by some folks in the first panel is that
8671
Lockheed Martin underbid the 110 conversion contract without the
8672
expertise to properly complete it, then when discovering that they were
8673
over their head, made business decisions based on cost and schedule on,
8674
among other things, low-smoke cables and shielded cables for the TEMPEST
8675
system that compromised national security and endangered Coast Guard
8676
personnel.
8677
8678
Do you think that that's an accurate representation of what happened
8679
with this conversion program?
8680
8681
BLORE: I don't believe I have the necessary information to make a
8682
judgment, sir.
8683
8684
The one thing I would say -- and I think this would support what Ms.
8685
Martindale said -- is a properly run acquisition would run enough
8686
government cost estimates and other surveys, including using our
8687
government audit agency, to ensure that a contractor is not bidding a
8688
price that on its appearance could not possibly do the work that the
8689
government's asking for.
8690
8691
That's the way the government protects against what somebody earlier
8692
referred to as an aggressive bid. If it's that aggressive, then the good
8693
government cost estimate should show that it's too aggressive and the
8694
work shouldn't be awarded.
8695
8696
I don't know enough about the details to really answer the question you
8697
asked, sir.
8698
8699
LATOURETTE: OK. Just specifically on the waivers and the low- smoke
8700
cabling that Commander Jacoby talked about, are you in agreement or in a
8701
position to be in agreement with the decision he made relative to the
8702
placement of those cables on the ship?
8703
8704
BLORE: Based on everything I know, I think I would agree that the
8705
waivers were appropriate for the non-low-smoke cables that were used.
8706
One of the things that the inspector general pointed out, which is very
8707
true, is that often the waivers and deviations were being given after
8708
the fact. In other words, they were following installation. That's
8709
another bad acquisition practice. If you're going to do something like
8710
that, it ought to be done before anything is installed.
8711
8712
But I think the actual location -- and I think even the inspector
8713
general agreed with this -- that there was no risk to the Coast Guard
8714
crew for the non-low-smoke cables that were installed, but they did find
8715
fault with the process and why the deviations were given after the fact.
8716
8717
LATOURETTE: And the fact that four ships had been delivered out of spec
8718
until that waiver was requested and granted. OK.
8719
8720
Thank you very much.
8721
8722
Thank you, Mr. Chairman.
8723
8724
CUMMINGS: Are we going to reverse that? We're going to do business
8725
differently now, right? I mean, I'm just following up on what he -- what
8726
Mr. LaTourette just asked you. We're not going to be having these
8727
waivers after the stuff is already done, are we?
8728
8729
BLORE: Not unless the waiver is in the interest of the government. I
8730
mean, there's always going to be considerations made that, you know,
8731
perhaps a piece of equipment is in the interest of the government to
8732
have installed, you know, before the fact. Otherwise, we won't accept
8733
it.
8734
8735
CUMMINGS: Just before we get to Mr. Oberstar, I think one of things that
8736
we are most concerned about, I mean, when you talk about this low-smoke
8737
cable and things that would go to the very survival -- I mean, I'm
8738
talking about life and death -- of the very people that you command, I
8739
think that we have to have a certain hope, a standard where if there is
8740
any -- if we're going to err with regard to waivers, that we err on the
8741
side of life and safety, and I think that sometimes I'm just wondering.
8742
8743
I mean, I've read what has been written in the I.G. report or what has
8744
been presented to us, and I just wonder whether we have done that
8745
consistently with those waivers. I think when we're dealing with things
8746
like that, I mean, I think we're going to -- because you know what? If
8747
we are granting these waivers and then something happens and we in the
8748
Congress knew about it and did not try to address it, then I think we've
8749
become a part of the problem.
8750
8751
And so, Mr. Oberstar?
8752
8753
OBERSTAR: Well said, Mr. Chairman.
8754
8755
And, Mr. LaTourette, also appreciate your line of questioning and the
8756
issues you raised. I think they're extremely important.
8757
8758
Admiral Blore, at the outset of your testimony and Admiral Allen's
8759
remarks in the news conference yesterday, avoid recurrence, good to
8760
avoid recurrence, but let's avoid living in the past. Let's not review
8761
the past.
8762
8763
Philosopher George Santayana wrote, "Those who do not study the past are
8764
condemned to relive it."
8765
8766
Thirty years ago, the Coast Guard in 1978 completed construction of two
8767
polar icebreakers -- it was my first or second term in Congress -- Polar
8768
Sea and Polar Wind. Polar Sea went on mission to break ice in the North
8769
Pole. In February of '81, it got stuck and stayed there for two months.
8770
8771
We're about learning lessons from the past and making sure they aren't
8772
repeated in the future. And I don't want to be lectured in this
8773
committee and all our members be lectured about learning from the past.
8774
8775
Were you aware that Admiral Kramek, after he retired, went to head the
8776
ABS, American Bureau of Shipping?
8777
8778
BLORE: Yes, sir.
8779
8780
OBERSTAR: And that during his tenure -- he's now retired from there --
8781
he offered to Bollinger to do structural engineering analysis and to do
8782
it free? Are you aware of that? And was refused.
8783
8784
BLORE: I'm not aware of the details, sir. I've certainly heard that, but
8785
not from necessarily a credible source. But, certainly, I've heard the
8786
story that it was offered.
8787
8788
OBERSTAR: Well, you know, in one case, the Coast Guard said, "Gee, we
8789
don't want to take the Navy's offer of doing this design analysis
8790
because it's going to cost us $42,000."
8791
8792
In the other hand, the shipyard gets an offer of free review and
8793
analysis and they won't take it either. There's something wrong with
8794
this.
8795
8796
Admiral Allen announced yesterday the Coast Guard's going to take the
8797
lead role as systems integrator for Deepwater. I'm not convinced you're
8798
ready to do that. Tell me how you think you're going to be able to do
8799
that in light of the testimony we've heard today.
8800
8801
BLORE: Yes, Mr. Chairman.
8802
8803
And before I answer that, let me say it was never the intent on the part
8804
of the Coast Guard -- and, certainly, I speak for the commandant -- to
8805
sound like we were lecturing anyone on learning from the past. And it is
8806
a little bit perhaps of a semantical difference. We do believe in
8807
learning from the past. We do believe in applying those lessons to the
8808
future. I think we meant it more in the context of not to fight the last
8809
war.
8810
8811
We need to learn from the past and apply it to the future acquisition
8812
because, you know, we know -- and as you know -- that we have a
8813
responsibility to recapitalize the Coast Guard so we can keep doing our
8814
missions, and that's what we meant. I'm not suggesting for a moment we
8815
shouldn't learn lessons from what occurred.
8816
8817
OBERSTAR: I appreciate that, but we want to know that the Coast Guard is
8818
learning those lessons and that they are ready to in various ways
8819
shoulder the responsibility of handling multibillion-dollar contracts
8820
that are going to carry the Coast Guard's capital equipment program into
8821
the future with a high degree of certainty that it can succeed.
8822
8823
Now I've been through this years ago with the FAA. They were unable, as
8824
it turned out -- and it was again the Navy who came in and did an
8825
assessment, Admiral Sullivan, of FAA's procurement program in the STARS
8826
acquisition and the Advanced Automation Replacement System -- and said,
8827
"They just don't have the personnel. They don't have the systems. They
8828
don't have the structure. They don't have the understanding of how to
8829
handle these multibillion-dollar contracts."
8830
8831
And it would seem to me that the Coast Guard was in the same mess. You
8832
got in way over your head, and you allowed these contractors to certify
8833
themselves.
8834
8835
And we want to know when we go forward, we want to do this Coast Guard
8836
authorization bill, do it right, put the money out there that's needed,
8837
give you the resources you need to move ahead, we want to know you're
8838
going to be able to do the job right.
8839
8840
BLORE: Yes, sir. I appreciate that, and I appreciate your support for
8841
the resources.
8842
8843
I believe we can do it right. That's why we've increased our staffing,
8844
that's why we've changed our processes on how we address things, and
8845
that's why we have a much closer working relationship with the United
8846
States Navy, because we know what we can do and we know what we can't
8847
do, and that's where we'll depend on other government agencies,
8848
primarily the Navy.
8849
8850
OBERSTAR: To whom does the Navy turn when it needs advice on hull
8851
machinery and electronics, or are you really, as everyone says, the gold
8852
standard?
8853
SULLIVAN: Sir, I don't know if we're the gold standard, but we have
8854
worked very hard to keep the expertise for hull mechanical, electrical
8855
and electronics in house because we believe that only the service can be
8856
in charge of knowing what it wants and specifying what it needs and in
8857
directing the contractors to deliver the performance that we need.
8858
That's a very precious core capability, we feel it's inherently
8859
governmental, and it takes years to grow.
8860
8861
OBERSTAR: In the upcoming authorization bill, it seems to me that this
8862
would be an appropriate time to craft, as we have done for the Corps of
8863
Engineers -- and a bill is coming up on the House floor tomorrow -- a
8864
process of independent review.
8865
8866
Admiral Blore, what do you think -- what would be the Coast Guard's
8867
reaction to, in general, an independent review authority for major
8868
contracts?
8869
8870
BLORE: Well, I think generally our reaction would be if it's the desire
8871
of the Congress, then we would execute it.
8872
8873
I don't know that we need congressional authority to do that. I think
8874
much of the independent review, such as hiring Defense Acquisition
8875
University and using third parties, we have ample authority to do
8876
ourselves.
8877
8878
OBERSTAR: There's no question you have ample authority to do it
8879
(inaudible) you haven't used today authority, and maybe what you need is
8880
direction from the Congress.
8881
8882
BLORE: Mr. Chairman, respectfully, I think that I would agree with your
8883
statement for 2002 through about 2004-1/2 (ph) or 2005. I think that the
8884
commandant has changed the way we do our processes.
8885
8886
Having said that, our number one priority, as far as any legislative
8887
language, is just that the Coast Guard be allowed the opportunity to
8888
continue our recapitalization program. Anything else that the Congress
8889
desires us to do -- and, obviously, if it's passed in the legislation we
8890
would do it -- but we would hope that we'd be allowed to continue to
8891
recapitalize the Coast Guard so we can execute our missions. And
8892
anything else, if the Congress would like to suggest it, we'd be happy
8893
to execute it.
8894
8895
OBERSTAR: We don't want to slow down at process at all. We don't want to
8896
stop it in its tracks. But the same with the Corps of Engineers who act
8897
only on direction of the Congress, and yet we've felt for some time that
8898
there was a need for independent review.
8899
8900
The Corps of Engineers came to an agreement with us on that, and we have
8901
language tomorrow that'll be on the House floor that will provide for
8902
that independent review.
8903
8904
We'll explore this further as we move into the authorization process and
8905
draw on the great resources we have in the members on this committee on
8906
both sides of the aisle.
8907
8908
Thank you, Mr. Chairman.
8909
And thank you very much, Admiral. We're about to set a record for
8910
endurance in this committee, and in another 15 minutes, we'll have done
8911
that, and I thank you for your endurance.
8912
8913
CUMMINGS: Mr. Gilchrest?
8914
8915
GILCHREST: Thank you, Mr. Chairman.
8916
8917
Admiral, how did these cutters get to Curtis Bay? These eight cutters,
8918
how did they get up there?
8919
8920
BLORE: We, I believe, towed the cutters. They may have gotten underway,
8921
because they are capable of it, to meet whatever cutter was towing them.
8922
It was our choice to tow them because we had put operational
8923
restrictions on them to keep the crew safe and not at risk, and we felt
8924
it had progressed to the point that we didn't want the cutters
8925
functioning independently.
8926
8927
GILCHREST: So I understand they're going to be scrapped?
8928
8929
BLORE: Yes sir.
8930
8931
GILCHREST: Where are they going to be scrapped?
8932
8933
BLORE: I don't think that's been determined yet, sir.
8934
8935
GILCHREST: So they're in such a condition that none of them could be
8936
salvaged or fixed?
8937
8938
BLORE: Again, I'm speaking on what I've been told because I'm not an
8939
engineer. Admiral Gabel, our chief engineer, did do a fairly exhaustive
8940
studying on the cutters. There were about six recommendations presented
8941
to the commandant.
8942
8943
I think right now there are three competing theories on what the root
8944
cause is. One's a naval architectural effect called channeling; the
8945
other is that the stern section, because of the way the lines are, was
8946
overly buoyant; and the third is that the metal itself was so fatigued,
8947
it didn't have enough structural strength from the original 110s.
8948
8949
It's Admiral Gabel's opinion that he has a very low confidence that...
8950
8951
GILCHREST: So, at any rate, it's just likely that the best thing to do,
8952
rather than go through any more expenses, is just scrap all eight?
8953
8954
BLORE: Yes, sir, because it's going to involve millions of dollars a
8955
single cutter, probably 18 to 24 months to develop, whether your
8956
solution actually works, and I think the commandant would like to focus
8957
elsewhere.
8958
8959
GILCHREST: OK. Just a couple of other questions.
8960
8961
And this would be to, I guess, Admiral Sullivan -- or Vice Admiral
8962
Sullivan.
8963
8964
Do you feel that the Coast Guard adequately addressed the concerns that
8965
apparently the Navy shared with its engineers about the hull integrity
8966
of these 123s?
8967
8968
SULLIVAN: Sir, I can tell you that what the Navy engineers said to the
8969
Coast Guard, that we were worried about the plate thickness and the
8970
section modules of the hull, and we offered to help, but beyond that,
8971
I'd be remiss to try to explain what...
8972
8973
(CROSSTALK)
8974
8975
GILCHREST: Was this consultation in the early stages of the
8976
consideration of the design of these vessels?
8977
8978
SULLIVAN: I think the consideration started with some very casual
8979
conversations in 2002, and nothing came of those, and then there were
8980
more serious conversations in 2005 when we actually produced a cost
8981
estimate for what we would do, and then that was about it.
8982
8983
GILCHREST: So, Admiral Blore, do you think that the problems that we
8984
have seen here today about adequate communication, consultation,
8985
recommendation between you and the Navy regarding this kind of issue has
8986
been adequately resolved?
8987
8988
BLORE: Yes, sir, especially as far as relationships between us and the
8989
Navy, and, in this particular case, using CCD or the Carderock Division
8990
for expert counsel.
8991
8992
GILCHREST: This ranges from whole design to logistics, the C4ISR, the
8993
whole ball of wax. This has been -- you feel that there are certain --
8994
the integration here is pretty well complete on these issues...
8995
8996
(CROSSTALK)
8997
8998
BLORE: Yes, sir. Yes, sir. And I would say really at all levels
8999
--between the CNO and the commandant, between me and my colleague, and
9000
certainly PEO ships, and the same thing on the logistics on the naval
9001
engineering side and the C4ISR side.
9002
9003
GILCHREST: Let me ask, the capabilities that the Navy has for in-house
9004
engineering, is that also in part of your conversation, that those
9005
capabilities, that in-house engineering capability, is any of that or
9006
can any of that be available to the Coast Guard?
9007
9008
SULLIVAN: Yes, sir. We stand ready to help. We are heavily loaded today.
9009
We have our own issues with cost reduction and staffing reduction at
9010
headquarters, but, compared to the capability that the Coast Guard
9011
lacks, we are robust and, subject to workload, we would definitely be
9012
ready to work.
9013
9014
GILCHREST: Is that something you would solicit, Admiral Blore, from the
9015
Navy?
9016
BLORE: Yes, sir. You're expressing it, respectfully, as if there's some
9017
hesitation on our part. There's no hesitation for us to work with the
9018
United States Navy.
9019
9020
GILCHREST: Have the Coast Guard and the Navy discussed the possibility
9021
of enhancing the commonality of the Navy and Coast Guard vessel designs
9022
and component systems?
9023
9024
BLORE: Yes, sir. I could just give you two quick examples.
9025
9026
Certainly for much of the Navy-type, Navy-owned equipment on the
9027
National Security Cutter, we're using the recommendations of the Navy.
9028
Our preference is to stay standard with them, if we can, because they
9029
bring...
9030
9031
GILCHREST: You say, "Our preference is to stay standard." Can it just be
9032
-- wouldn't it be better if it was standard and can it be made standard?
9033
9034
BLORE: Yes, sir, but, for example, they would put many more weapon
9035
systems on a patrol boat than we would. So there are some cases where we
9036
won't be standard because we just won't have as powerful a weapon's
9037
suite as they would.
9038
9039
In the case of the offshore patrol cutter, which is still a couple of
9040
years away, we're currently working with NAVSEA to actually do a study
9041
together on how the LCS, an original design offshore patrol cutter, or
9042
even our National Security Cutter might be used to kind of form the
9043
basis of a design.
9044
9045
We're very interested in seeing how the Littoral Combat Ship develops
9046
and whether it would be possible to have potentially, for example, a
9047
Coast Guard version of that. So we are very interested in being aligned
9048
and have commonality when we can.
9049
9050
SULLIVAN: Let me give a couple more examples, sir. The gun on the
9051
National Security Cutter is the same as the gun on the LCS, and that gun
9052
is also going to be used on the DDG-1000, and we're sharing all our
9053
information across the services (inaudible) make sure we're as common as
9054
we possibly can be in the installation of that gun.
9055
9056
Additionally, I mentioned Naval Vessel Rules before, where we're
9057
developing them in conjunction with ABS. The Coast Guard signed on, I
9058
guess, about two years ago, and there's a Coast Guard annex to the Naval
9059
Vessel Rules. So we are sharing all the lessons learned and all of the
9060
rule development.
9061
9062
My chief engineer, Kevin McCoy, and Admiral Gabel, his counterpart in
9063
the Coast Guard, have cosigned an agreement that they will work
9064
together, and Admiral Gabel is now attending all the meetings of the
9065
Naval Vessel Rules Committee. So there's an awful lot going on there
9066
now.
9067
9068
GILCHREST: Thank you very much, gentlemen.
9069
9070
Thank you, Mr. Chairman.
9071
CUMMINGS: Thank you very much.
9072
9073
Mr. Kagen?
9074
9075
KAGEN: Thank you, Mr. Chairman.
9076
9077
And I'll make no reference to icebreakers, because, by the time we get
9078
out of here, all the polar ice caps are going to be melted. Got to have
9079
a sense of humor.
9080
9081
Admiral Blore, I just want to get your opinion on record here about Mr.
9082
Ronald Porter. Is Ron Porter a CTTA?
9083
9084
BLORE: Again, as was mentioned before, I have not -- I don't think I've
9085
actually met him or asked to see his credentials. I would go to the
9086
assistant commandant for command, control and information to get
9087
certification on TEMPEST, and I believe they used Mr. Porter.
9088
9089
KAGEN: OK. Then I'll ask you a hypothetical question. Assuming that he
9090
is not a CTTA, then would it be true that those ships that have been
9091
firing up their communications equipment have been doing so in violation
9092
of our rules and laws?
9093
9094
BLORE: I would assume you need to have the proper certification and
9095
authority to grant the authority to operate. Yes, sir.
9096
9097
KAGEN: OK.
9098
9099
Thank you, gentlemen, for your service to the country.
9100
9101
And I yield back my time.
9102
9103
CUMMINGS: Thank you very much.
9104
9105
I want to thank you all for your testimony.
9106
9107
I want to thank the members of Congress for sticking around this long. I
9108
know you have 50 million things to do.
9109
9110
And this does conclude our hearing.
9111
9112
But please understand that Mr. Oberstar and many of us have expressed
9113
our concerns with regard to where the Coast Guard is going, and we want
9114
to make it very, very clear -- and I said it from the very beginning
9115
when I was appointed the subcommittee chairman -- that I am going to be
9116
a number one fan of the Coast Guard, but in being a number one fan, that
9117
also means that we want the Coast Guard to be the very, very, very best
9118
that it can be so that it can do all the things that it's mandated to do
9119
and do it effectively and efficiently.
9120
9121
And so this has in no way been an effort to try to make anybody look
9122
bad. We just need to look to see what has happened in the past, as Mr.
9123
Oberstar said, so that we can chart a most effective and efficient
9124
course for the future.
9125
9126
And I think this hearing has gone a long way towards doing that. We
9127
certainly will look very carefully at what has transpired here and act
9128
accordingly there. I'm sure that there will be some follow-up questions.
9129
9130
9131
And we thank you all very much.
9132
And this hearing is adjourned.
9133
9134
END .ETX
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