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SCA Weekly Report | March 28 - April 1, 2022
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Registration Now Open: 2022 SCA Spring Meeting
May 11-12, 2022
Adams & Reese, LLP
20 F St. NW
Washington, D.C.
The 2022 SCA Spring General Membership Meeting will be held in-person on May 11-12, 2022. The cost to attend the meeting is $550.
The meeting will be held in the downstairs conference rooms at our office building at 20 F St. NW, Washington D.C. 20001.
SCA Board and Committee Meetings will be held on Wednesday, May 11, 2022 and SCA Staff Reports, the Government Speaker Sessions, and membership dinner will be held on Thursday, May 12, 2022.
More details on the event, including guest speakers, will come out soon.
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Please note SCA did not put together a room block for this meeting, therefore all meeting attendees will need to secure their own hotel reservations in D.C.
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MMA & SCA Sea, Air, and Space Reception
The Marine Machinery Association and The Shipbuilders Council of America invite you to a reception on Monday April 4, 2022, at The Westin Hotel National Harbor from 6-8PM. This is a private event for MMA and SCA members only. The event will be free to members and shipbuilders who signup prior to March 28.
Register for the event HERE.
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SCA Industry Impacts Survey
At the SCA 2022 Winter Meeting, the Industry Partners Committee recommended, and the SCA Board of Directors approved, a survey to solicit input from SCA members on the various impacts on the shipyard industrial base including resulting lingering COVID issues, supply chain disruptions, inflationary costs and federal budget uncertainty, among other industry concerns.
Member participation in this survey is critical to conveying these adverse impacts on shipbuilding, ship repairing, and the businesses that support and supply the shipyard industry. The results of the survey will be aggregated industry data points to assist SCA's efforts to advocate for the shipyard industrial base to the Pentagon, Administration, and Congress.
The survey should not take any longer than 5-10 minutes to complete, and all results will be blinded and aggregated. This means that all company information will remain anonymous and only viewed by the SCA team.
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White House Releases FY23 Top Lines
On Monday, the White House released its topline numbers for the FY2023 fiscal year. During the Navy Department’s budget briefing at the Pentagon, Rear Adm. John Gumbleton, deputy assistant secretary of the Navy for Budget, said the Navy is requesting the retirement of 24 ships, compared with the construction of nine battle force ships.
Gumbleton listed the types of the 24 ships targeted for retirement:
- 9 littoral combat ships
- 5 Ticonderoga-class guided-missile cruisers
- 2 Los Angeles-class nuclear-powered attack submarines
- 2 Henry J. Kaiser fleet replenishment oilers
- 4 Whidbey Island- or Harpers Ferry-class dock landing ships
- 2 Montford Point-class expeditionary transfer dock ships
He said the retirements would save the Navy $3.6 billion over the Future Years Defense Plan. Under the Future Years Defense Plan, the size of the Navy’s battle force would shrink from 298 today to 280 in fiscal 2027. Chief of Naval Operations Adm. Michael Gilday has advocated divesting in order to invest, and this budget supports that concept.
The nine battle force ships requested for 2023 totals $27.9 billion and includes:
- 2 Virginia-class SSNs
- 2 Flight III Arleigh Burke-class guided-missile destroyers
- 1 Constellation-class guided-missile frigate
- 1 America-class amphibious assault ship
- 1 Flight II San Antonio-class amphibious transport dock ship
- 1 John Lewis-class fleet replenishment oilers
- 1 Navajo-class towing, salvage and rescue ship
For 2022, the Navy requested eight ships, but Congress increased the number to 13 in the enactment of that budget. The 2023 budget would continue to fund the Columbia-class ballistic-missile submarine, the Ford-class aircraft carriers, and advance procurement for two Virginia-class nuclear-powered attack submarines.
Gumbleton said 2023 would be the last year for procurement of the San Antonio-class transport dock ship. Also, under the Future Years Defense Plan, production of the Constellation-class guided-missile frigate would alternate one and two ships year by year. Procurement of the light amphibious warship and the submarine tender replacement would begin in fiscal 2025, followed by the next-generation logistics ship in 2026. Research and development funding is provided for the large unmanned surface vessel and the extra-large unmanned underwater vessel. The 2023 budget also would fund the purchase of two used sealift ships for the Maritime Administration’s Ready Reserve Force. The fiscal 2023 also requests funding for two LCAC 100-class ship-to-shore connectors and the service-life extension of two LCAC 01-class connectors; but does not request more new LCU 1700-class utility landing craft.
Full details of the budget request will not be available until mid-April.
With Ink Barely Dry, Biden Budget Put Through the Wringer
President Joe Biden and his Democratic allies on Capitol Hill are in for another protracted standoff over fiscal priorities, based on Republicans' reaction to Biden's election year budget released Monday.
Even before the House Budget Committee opened the fiscal 2023 cycle hearings Tuesday, the Senate's top GOP appropriator was throwing cold water on Biden's proposed 4 percent increase for Pentagon and other defense-related accounts.
Sen. Richard C. Shelby (R-AL), the top Republican on the Senate Appropriations Committee, said Monday the budget “woefully” underfunds defense, considering Russia’s invasion of Ukraine. “That budget will go nowhere as is,” he said.
Biden proposed boosting the military budget to $773 billion in fiscal 2023, a roughly 3 percent increase after taking into account supplemental appropriations for the Pentagon's efforts this fiscal year to aid the Ukrainian resistance and other European allies. Considering the effects of unusually high inflation, Republicans say that's not nearly steep enough.
Including nuclear energy programs and other defense-related activities, the overall national security budget would hit $813 billion next year under Biden's request, a $31 billion increase over this year without supplemental Ukraine aid factored in. Domestic and foreign aid programs, by contrast, would receive a nearly $100 billion increase, or almost 14 percent, to $829 billion in nonemergency funds.
While Republicans have long pushed for "parity" in discretionary spending increases, Shelby said he may push for a larger boost to defense spending than nondefense for fiscal 2023. “We might need some plus-up in defense, because of the world’s situation,” he said.
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Maersk to Enter Wind Installation Market with New WTIV
Maersk Supply Service, a unit of A.P. Moller-Maersk, will construct its first offshore wind turbine installation vessel (WTIV) following a contract award from Equinor and BP in the United States. The vessel will be built by SembCorp Marine in Singapore with the steel-cutting ceremony set for later this year. Delivery of the vessel is expected in 2025. The investment from Maersk Supply Service comes after Maersk was awarded a contract from Equinor and BP to install turbines for the Empire 1 and 2 wind farms off of New York State, together with U.S. partner Kirby Corporation.
BOEM Sets May Auction Date for First Carolinas Offshore Wind Leases
Following the strong success of the auctions of leases off the coast of New York and New Jersey, the U.S. Department of the Interior scheduled its next auctions for an area off the coast of North Carolina and South Carolina known as Carolina Long Bay. The auction, which is scheduled for May 11, is for just over 110,000 acres in two leases with a goal of establishing at least 1.3 GW of offshore power generation. Carolina Long Bay lies east of Myrtle Beach, South Carolina with the closest land point being about 15 miles to the north, Bald Head Island, North Carolina.
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Biden Orders Huge Oil Release, Prods Drillers to Step Up Output
On Thursday, President Joe Biden announced the release of 1 million barrels of oil a day for the next six months from the U.S. Strategic Petroleum Reserve to try to bring down gasoline prices. Biden said his plan would lay a foundation for the country to achieve independence from foreign energy suppliers.
The bulk of that oil will be transported through pipelines, but shipping is likely to also be needed for transport to some parts of the country without pipeline infrastructure.
Biden blamed a spike in gasoline prices this year on Russian President Vladimir Putin and Russia’s invasion of Ukraine, calling it “Putin’s price hike.” But he also criticized U.S. oil companies that have been reluctant to increase production, and called for Congress to charge fees to firms that have unused drilling leases on federal lands.
Ever Forward Still Stuck; New Attempt Planned
Eighteen days after it went astray in the Chesapeake Bay, the container vessel, Ever Forward, remained aground near the Craighill Channel, defying the best efforts of tugboat and dredge crews to refloat the ship. The ship was outbound from Baltimore heading down the bay to Norfolk, VA on March 13 when it strayed out of deep water and ran aground. The Coast Guard says it’s still investigating the cause of the incident.
After two unsuccessful attempts to dislodge the vessel with dredging and up to seven tugs pushing and pulling, a backup plan would add two anchored barges to apply additional pulling power to the ship this weekend. As a last resort barges and cranes would be employed to lift containers and lighten the ship. A Coast Guard-supervised team on board the Ever Forward has been regularly sounding fuel and ballast tanks, on the watch for potential pollution. A naval architect is also on board to monitor and evaluate the ship’s stability during the refloating operation.
Alaska Invites Contractor Proposals for Ferry Replacement Project Services
The Alaska Department of Transportation & Public Facilities is now seeking proposals for preconstruction and construction services for the Tustumena Replacement Vessel (TRV), an ocean-class passenger and vehicle ferry that will operate on behalf of the Alaska Marine Highway System. The new ferry is a replacement for a 57-year-old ferry that is now costing the state $2 million a year in repairs.
Specifically, the department is inviting proposals from general construction contractors to serve as “Construction Manager/General Contractor (CMGC) for the TRV project. The CMGC procurement is intended to encompass all materials, labor, supplies, equipment and supervision necessary for the complete construction of the project, including any preconstruction related services during the development process.”
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If you have any questions, please do not hesitate to contact the SCA staff.
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