Opinion: Strategic Sealift is Broken - Which Direction Are We Headed?

[By David Sloane]

In March of 2020, Commanding Officer of U.S. Transportation Command Gen. Stephen R. Lyons told the U.S. House Readiness Subcommittee and the Seapower and Projection Forces Subcommittee that:

“USTRANSCOM’s number two readiness concern is the Strategic Sealift Fleet. The sealift fleet is responsible for moving approximately 90 percent of wartime cargo. Sealift readiness rates have declined to 59% compared against a goal of 85 percent, with vessel material condition and age as the primary factors. Most sealift ships are reaching the age where maintenance and repair costs are escalating and service-life extensions will not yield proportional increases in readiness. Starting in the mid-2020s, the sealift fleet will lose 1-2 million square feet of capacity each year as ships reach the end of their useful life.”

None of this is a surprise to anyone who has been involved with or has observed the slow and steady decline of the Strategic Sealift fleet. This article will survey some of the issues that have caused this decline, describe some mistakes that have been made in trying to correct them, and propose a few possible solutions to ensure the warfighters have the tools they need to quickly respond to emergent contingencies.

The Reduced Operating Status Model Is Broken

The United States maintains a fleet of ships on standby to be available to meet warfighter needs to mobilize equipment on short notice. These ships are Roll On/Roll Off (RO/RO) ships kept at layberths at ports all over the country. The strategic sealift ships are divided into two separate fleets, managed by two separate government organizations: the U.S. Navy’s Military Sealift Command (MSC) and the Department of Transportation’s Maritime Administration (MARAD). The ships are kept in a reduced operating status (ROS 5) which is designed to have the ships fully ready to activate and load cargo five days after notification at which point the ships are in fully operational status (FOS).

Within the current strategic sealift fleet, the five ships of the Bob Hope class are the “gold standard,” and would probably be activated first as sealift needs arise during an emergent crisis. The issues raised in this article are specific to the Bob Hope class, which is managed by MSC, but similar problems exist within other segments of the strategic sealift fleet. These ships are operated by a private shipping company contracted to MSC to operate and maintain these ships. This arrangement is referred to as government owned and contractor operated (GOCO).

When fully operational in FOS the ships are manned with 30 U.S. citizen mariners. When in the normal ROS status while layberthed the ships are manned with only 14 mariners who are tasked with completing all maintenance tasks required to keep the ship fully prepared to activate within 5 days’ notice. These mariners work a Monday to Friday 9 to 5 schedule, living ashore at night and over weekends. It should be noted that the ships’ preventative maintenance requirements change very little between ROS periods and when the ship is fully manned for FOS periods. Consequently, it is nearly impossible for the smaller ROS crews to keep up with all of the maintenance required to ensure that these ageing ships are fully prepared to activate.

These ships, like any others, require more maintenance with age. The Bob Hope class ships were built at the now-defunct Avondale shipyard, and are now between 19 and 22 years old. That would be very old for a commercial RO/RO ship, but these are the babies of the strategic sealift fleet.

Furthermore, ships are made to operate at sea and not sit in port for months and months at a time. When a ship sits in port the equipment and machinery that needs to be in good working order just is not exercised enough. As a result, when it’s time to go to sea much of this same equipment will either not work properly or will break shortly after getting underway. Of course, the preventative maintenance assigned to the ROS crew is designed to ensure this doesn’t happen, but there are not enough hours in a normal work week for the smaller crew to keep up under the current funding scheme. Consequently, the ships keep degrading and have a low state of readiness.

Budget Woes

The government is not funding the five ships of the Bob Hope class adequately to support the state of readiness required by the warfighter to support contingency scenarios. The ship’s operator annually submits an operating budget to MSC for review, including funding levels for all aspects of the ships’ operation, including maintenance and repair. As the operator and employer of the mariners performing maintenance, the operator is in the best position to estimate what will be required to keep the ship’s equipment fully functioning to the international standards for safety, as certified by the U.S. Coast Guard (USCG) and the American Bureau of Shipping (ABS).

Unfortunately, the last several years have seen a severe shortfall of funds authorized as compared to funds requested. Here are a few examples of the funding shortfalls for the budgets covering Industrial Assistance, Spare Parts and Crew Overtime: 

• FY20- Funding was $19.5 million short of the requested budget. The government provided 44 percent of the requested amount.
• FY21- Funding was $30 million short of the requested budget. The government provided 38 percent of the requested amount.

The underfunding problem is getting worse instead of better, but as anyone who has had responsibility for maintaining operating ships can attest, neglecting a ship’s maintenance only means the future costs will only go higher, never lower. The government claims to have “managed” the shortfalls by deferring required maintenance for critical items across the fleet. These items include but are not limited to Main Diesel Propulsion Engines and Ships Service Diesel Engines. Not surprisingly, one of the ships was issued a non-conformity – a failing grade – during a regulatory audit due to a shortage of spare parts; the ship’s under-funded budget for spares had already been exhausted. Note that the budget issues described above are only for annual operating expenses, not the periodic maintenance costs required every 30 months. These have their own funding issues.

The government has also severely underfunded the critical Repair/Overhaul (ROH) periods that are required twice every five years to keep the ships fully certified by the USCG and ABS. These are shipyard periods where the ships are drydocked in a U.S. shipyard for a typical 90 day (or more if problems are discovered while the ship is in the shipyard) repair period. Planning for these periods is a year-long process to identify the critical repairs that must be done to keep the ship in good shape for the next 2 to 3 years. In addition to critical repairs to the underwater portions of the ship, special attention is given to fuel and ballast tanks which need to be preserved, especially as these ships go past 20 years of age.

USNS Mendonca serves as a case in point. Cost estimates for required work during her ROH period last year totaled $27.9 million, but when U.S. shipyards provided bids in line with those numbers, the government de-scoped the ship’s work package by 40 percent due to a lack of funding available. The 60 percent of approved work was completed at a cost of about $21 million. When the repair period was over the ship did not meet USCG and ABS regulatory standards and had to proceed to a layberth under a “permit to proceed” – a one way ticket to a pier that would not allow further voyages until all of the work was completed. Once the ship was at a layberth, work continued, but funded from the normal operating budgets nominally assigned to other ships, further reducing the amount of funds to keep the fleet in a ready status.

This same process repeated when Bob Hope had her ROH period last year: The USCG and ABS did not approve the ship to leave the shipyard in a fully certificated status and the ship was allowed to be shifted to a layberth to complete needed repairs. These ships would not have been ready to meet warfighter requirements as a direct consequence of chronic and systemic underfunding. It is embarrassing that the first line of defense strategic sealift ships are not funded to meet the same standards that ships owned by private U.S. flag ship owners must meet to stay in business.

Software and Hardware

Everything discussed so far addresses hardware concerns with the strategic sealift ships themselves – and the lack of funding to maintain these vessels. Often not discussed is the software that makes these ships go, the U.S. citizen mariners who accept jobs as civilians to voluntarily make a career of working aboard ships that rarely move. Readiness discussions often only relate to the hardware, but readiness of the software is just as important.

The ROS model of keeping ships with only 14 crewmembers permanently assigned has led directly to a long term lack of readiness of all of these ships. When a ship is activated it is very likely that several licensed officers will be assigned that have never been aboard that ship before. While that may have worked in previous generations of ships where there was very little difference between critical systems, it does not work in 2021.

Imagine being a deck officer who reports to a ship never having operated ship specific critical equipment such as stern ramps, cargo cranes, navigation equipment, main engine controls and communication equipment. At the same time, these officers have likely never worked together as a bridge management team, something critical to safe ship operations, especially within restricted waters. On top of that imagine that these officers are not familiar with the ships USCG required Safety Management System (SMS). All of these issues exist, and the crew has less than 5 days to have the ship ready to depart.

Another rarely-discussed but important issue is the shrinking labor pool that is available and willing to work aboard these ships. Mariners generally want to work on ships that spend their time completing voyages at sea, not moored to a pier for months at a time. These mariners appreciate the lifestyle that allows generous vacation pay which affords them a great deal of time off when they return to their friends and families. Mariners who work aboard ships in ROS status receive the advantage of going home every night but their pay is significantly less than those working on fully active ships, as they do not receive the same vacation pay. Total compensation for a ROS mariner is about 45 percent lower for the officers and 25 percent lower for unlicensed mariners compared with what a mariner earns for working on a fully active ship for a typical 120 day assignment.

An even more troubling consequence of this self-selected labor pool is that the very ROS mariners who know the ship best are also accustomed to going home every night, and often decide NOT to sail with the ship when activations occur because they don’t want to go to sea. So, when a ship gets activated the companies responsible for manning them take whoever might be available. A very brief activation of a week or so might attract mariners who are on vacation from their “regular” ships, but a mission of several months will produce a far smaller pool of available mariners. Most mariners prefer to stick with their regular jobs over these longer activations, because once the ship returns to ROS their regular jobs will be filled and over half of the FOS positions will disappear. These factors make the proper maintenance of strategic sealift ships an incredible challenge. Ships work best when they have steady crews who are given the opportunity to operate the ships at sea with steady employment.

Recapitalization

Old ships eventually need to be replaced, and the idea that the ageing strategic sealift fleet needs to be replaced is not a new one. The Department of Defense and Congress have been discussing this for many years, but nothing happens quickly in the procurement of ships for DoD. These parties, along with TRANSCOM, have realized for a long time that the only practical solution is to purchase foreign-built hulls and convert them for service in the strategic sealift fleet. The length of time it would take to design, procure and build new strategic sealift ships in U.S. shipyards is just too long for the pressing needs, given the nature of American government bureaucracy.

U.S. shipbuilding interests have strong political influence, and so it is a small miracle that Congress has approved and funded this plan to purchase ships that were not built in the United States for strategic sealift recapitalization. MARAD intends to hire a private company to procure, convert, and operate “new” ships for the fleet via a contract titled “Vessel Acquisition Manager (VAM) service for the U.S. Department of Transportation, Maritime Administration (MARAD) Ready Reserve Fleet (RRF) Recapitalization.” The original Request for Proposals (RFP) went out to industry in February 2020, but due to a series of protests that were sustained by the U.S. General Accountability Office (GAO), MARAD has been unable to award this contract to date. The eventual awardee will have to identify the ships and get approval to purchase them for the government and then convert them for service. It will take years, not months, to complete these tasks.

Unfortunately, prices for used RO/RO ships on the international market have recently surged along with the demand created by the post-COVID economy, leading to a reduced availability of commercial RO/RO tonnage. Several companies have ordered new vessels, but it will take a few years for these new deliveries to be completed and the older ships to be available. If the U.S. Government is planning on recapitalizing the strategic sealift fleet by purchasing good, used ships, the last thing that should happen is to purchase older existing U.S. flag tonnage, as this will only recreate the current situation in a matter of years. The government missed a good opportunity to purchase replacement tonnage at bargain prices, and will be forced to pay millions of dollars more for the fewer ships available on the open market.

What’s Next?

It’s not clear that there is strong political will for the Department of Defense to operate and maintain a fleet of ships that is fully prepared on short notice to be available to carry its heavy equipment to the battle as the U.S. faces growing threats in the Pacific and Atlantic oceans. While it is safe to say this problem has been discussed at great length, little is being done to correct this issue other than allocate a far too little amount for replacement ships that will arrive too late. A few suggestions:

• Change the operating model for the ships that still are in the fleet- assign full crews to the existing ships to allow them the opportunity to properly maintain and exercise the equipment.
• Assigning full crews will grow the motivated and fully trained personnel pool that will be available to meet emergent mission requirements.
• Spend more days at sea- ships are much more dependable when they operate regularly
• Fully fund both annual and periodic maintenance- you can pay now or pay later but paying later will always cost more.
• Engage private industry for ideas - the firms that operate ships in the international market keep their ships operating or they go out of business. If you talk to companies that operate ships in both commercial and government service you will find out that the ships in commercial service have nowhere near the down time that ships in government service do. Maybe there are some reasons for that? Maybe that should be looked into?
• Instead of purchasing old ships, consideration should be given to chartering newer ships for 5 to 10 years. These ships can merely be replaced when the charters expire. This would ensure that modern ships are always available to the warfighter and eliminates any costs associated with disposing of older and no longer needed tonnage.

It is very clear that the current model is not working. The continued use of the current model will only lead to a fleet that is less ready with fewer mariners who are capable of operating and maintaining this critical defense capability. A change in direction must be made soon and the clock is ticking.

David Sloane is a graduate of the U.S. Merchant Marine Academy has worked afloat and ashore in the U.S. flag maritime industry for almost 40 years. He currently works for Maersk Line, Limited and teaches “International Maritime Transportation” at Old Dominion University. Any views/opinions represented in this article are personal and belong solely to the author and do not represent those of people, institutions or organizations that the author may be associated with in a professional or personal capacity.

This article appears courtesy of CIMSEC and may be found in its original form here.