GAO Warns of Costly Rework, Delays in Coast Guard Cutter Program
WASHINGTON — The Government Accountability Office has raised serious concerns about the Coast Guard’s Offshore Patrol Cutter program, warning that construction has begun on new vessels before design specifications have been finalized—a decision that could trigger substantial cost overruns and delivery delays.
The OPC program represents a critical modernization effort for the Coast Guard, designed to replace aging vessels used in law enforcement, search and rescue, and maritime security operations. The service has awarded contracts to Eastern Shipbuilding Group in Florida for stage 1 vessels and Austal USA in Alabama for stage 2 construction, with plans for a third phase involving additional contractors. The entire acquisition program is valued at more than $17 billion for 25 cutters.
According to the GAO report released Tuesday, construction on OPC 5 commenced in August 2024 without achieving design stability—a foundational principle in shipbuilding that ensures specifications are locked before production begins. This decision significantly increases the probability of expensive design modifications mid-construction, the watchdog cautioned.
“Starting construction of more stage 2 OPCs before stabilizing the design, as the Coast Guard plans to do, increases the risk that stage 2 will also encounter costly rework and schedule delays,” the GAO stated.
The program has already experienced substantial setbacks. Stage 1 construction has been beset by complications, leading the Coast Guard to halt work on two of four contracted vessels. The first Offshore Patrol Cutter delivery is now delayed by five years compared to original timelines—a cautionary indicator of systemic challenges within the program.
While the GAO acknowledged that Austal USA and the Coast Guard incorporated some industry best practices during stage 2 design development, including collaborative design reviews, these measures proved insufficient to prevent premature construction authorization.
The watchdog recommended that the Coast Guard delay stage 3 procurement activities until test results validate whether existing designs meet performance requirements. This approach would incorporate lessons learned from stage 1 and 2 execution before committing additional resources.
The Department of Homeland Security’s response, submitted by Jeffrey Bobich, director of financial management, defended the decision to authorize stage 2 construction, asserting that the Coast Guard had established adequate “minimum requirements for design maturity.” DHS concurred with recommendations to reassess program baselines and develop stage 3 plans with greater flexibility to accommodate evolving conditions.
This GAO report underscores ongoing challenges within major defense acquisition programs, particularly the tension between maintaining schedules and ensuring engineering rigor. Industry experts emphasize that design stability represents a critical success factor in shipbuilding, where mid-stream modifications can cascade into exponential cost increases and timeline extensions.
Source ID: SRCE-2025-1764173074213-977