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SCA Weekly Report | September 16 - 20, 2019

Shipbuilders Council of America

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SCA Weekly Report | September 16 - 20, 2019




Register Now for the 2019 SCA Fall Membership Meeting


Registration for the 2019 SCA Fall Membership Meeting is still open. The meeting will take place at the Marriott City Center in Newport News, Virginia. Registration for the SCA meeting is $650 per attendee.



  • Jennifer Boykin, President, Newport News Shipbuilding
  • Mitch Waldman, Executive Vice President of Government and Customer Relations, Huntington Ingalls Industries
  • Bryan Caccavale, Vice President of Strategic Sourcing, Huntington Ingalls Industries
  • Nancy Sopko, Co-Director, Special Initiative on Offshore Wind
  • Laura Morton, Senior Director, American Wind Energy Association (AWEA)
  • Jim Bennett, Chief of the Office of Renewable Energy Programs, BOEM
  • RDML Tom Anderson, Commander Regional Maintenance Center, USN



  • Offshore Wind Energy Panel
  • Newport News Shipbuilding Supplier Panel


A full schedule of events can be found HERE.






DHS Hiring


Deputy Director of Acquisition Programs

View the Job Posting HERE>


AEU LEAD Leadership Development Workshop

Event info:

For those on the front line who want to develop their leadership capabilities, the opportunity or timing has never been better! Join Joe White and Woody Collins of AEU LEAD in St. Louis on October 22 & 23 for a day and a half leadership development workshop. To register or to learn more, click here.


By attending this workshop, you will:

  • Use assessment tools to identify areas of strength and opportunities for targeted leadership development
  • Learn six critical skills needed to earn the respect of others as well as to grow and improve employee engagement
  • Develop an individualized action plan for post workshop follow up and completion


Who should attend: front-line supervisors, foreman, crew leads, and middle managers.




House Passes Stopgap Funding Bill

The House passed a short-term spending bill that would fund the government through Nov. 21 and give lawmakers more time to pass full-year appropriations measures for the fiscal year that starts next month. The vote on H.R. 4378 was 301 to 123. The bill would also extend authorizations for several expiring health programs, including Medicaid funding for Puerto Rico and other U.S. territories, and boost funding for the Census Bureau and Secret Service. Lawmakers agreed to a White House request to replenish the Agriculture Department’s Commodity Credit Corporation for payments to farmers affected by retaliatory tariffs. The Senate plans a vote next week.


Defense Spending Hits Wall in Senate

Senate Democrats on Wednesday blocked Republican plans to advance an appropriations package including $693 billion in defense spending for fiscal 2020, all but assuring that lawmakers will have to adopt a short-term budget extension in coming days to avoid a possible government shutdown. The Senate motion to advance the appropriations package failed 51-44. The package needed 60 votes to proceed. The latest budget impasse comes despite Congress reaching a bipartisan, two-year, $2.7 trillion budget deal in July which set funding levels for defense and non-military programs, an agreement many hoped would avoid piecemeal spending plans for fiscal 2020.


Defense leaders have repeatedly pleaded with lawmakers in recent years to finalize the full-year military budget by the start of the new fiscal year (Oct. 1) to prevent disruptions in weapons purchases, new program starts and a host of other Pentagon operations. But Democrats have been reluctant to fund defense on its own in recent years amid fears that it will remove leverage in budget negotiations, allowing Republicans to abandon agreements for increases in non-military spending once the armed forces are taken care of.


RELATED: INSIDE DEFENSE: Pentagon Hopes CR Will Be Kept to ‘A Few Weeks’


House and Senate Lawmakers Begin Negotiations Over FY20 NDAA

This week, House and Senate lawmakers began negotiations over the fiscal year 2020 National Defense Authorization Act (NDAA). Concerns over partisan disagreements regarding funding for President Trump’s border wall could stall the bill or even derail it for the first time in nearly six decades. According to several congressional staffers, a possibility has emerged that the authorization bill could sidestep most of the wall funding issue and leave it to congressional appropriators.


At issue is $6.1 billion in military funding Trump has ordered the Pentagon use to construct a wall on the U.S.-Mexico border. Earlier this month, the Pentagon deferred $3.6 billion from 127 military construction projects so the funds could be diverted to the wall without congressional approval. That was in addition to $2.5 billion the Pentagon reprogrammed from other priorities towards the wall, also without the consent of Congress. The GOP-led Senate's version of the defense authorization bill would "backfill" the money, while the Democrat-led House bill would not.




TRANSCOM Announces Auxiliary Ship Exercise

The U.S. Department of Defense has ordered a large-scale turbo activation of ships in the U.S. Maritime Administration’s (MARAD) Ready Reserve Force fleet. The turbo activation is part of a large-scale activation exercise ordered by the U.S. Transportation Command (USTRANSCOM) on September 16. The activation calls for a total of 28 RRF fleet vessels to transition from reduced operating status to fully crewed and full operating status within 5-days. Activations are commonly followed by immediate sea trials. The last turbo activation exercise was directed by Military Sealift Command in July when it ordered three to get underway with just five days notice from their berths in Alameda, California. The three vessels participating in July’s exercise included the SS Gem State (T-ACS 2), SS Keystone State (T-ACS 1) and SS Grand Canyon State (T-ACS 3). All three ships departed for the three-day sea trial within four days of activation.


RELATED: INSIDE DEENSE: TRANSCOM’s latest sealift exercise not driven by RAND report criticism




Navy Moves to Penalize Contractors for Poor Cybersecurity  

A new acquisition rule published this month details how the Navy could levy financial penalties against contractors for not meeting cybersecurity standards, as the service aims to better protect sensitive data in the face of what it considers a "cyber siege" by China and other competitor nations.  The new policy is laid out in a Sept. 6 update to the Navy Marine Corps Acquisition Regulation Supplement. It defines cybersecurity rules as "material requirements" in contracts and directs contracting officers to "consider the right to reduce or suspend progress payments for contractor noncompliance."


If the Navy awards a contract to a company with "critical or major non-conformances," the contracting officer can modify the award with "an equitable price reduction or other consideration," according to the regulation. It suggests 5% of the contract value as a "reasonable" reduction. The DFARS has been in place since early 2018, but recent audits have discovered many defense contractors are struggling to implement key security controls, while DOD has been lax in enforcing the standards. In addition to the financial penalties, the updated Navy regulation also directs contracting officers to include a new "Annex 16" in contracts where the program manager, program executive officer or chief of naval research "determines that the risk to a critical program and/or technology warrants its inclusion."


The Navy's new acquisition rule comes as Pentagon leaders move forward with a new set of cyber standards through the "Cybersecurity Maturity Model Certification" initiative. The CMMC will combine several current sets of cyber controls, including NIST 800-171, into five different levels of security ranging from basic cyber hygiene to advanced network protections. However, DOD officials don't expect the CMMC process to go into effect until next fall.





Modly Acknowledges 355 Ships Won’t Happen in ‘Reasonable’ Amount of Time

The Navy's second most senior civilian this week acknowledged the service will not achieve its 355-ship goal in a "reasonable" amount of time and that without a $20 billion to $30 billion increase in annual funding, the Navy could only maintain between 305 and 308 ships. "We had a goal of a 355-ship Navy," Navy Under Secretary Thomas Modly said in a speech at a Professional Services Council conference. "I will tell you it is going to be very, very difficult for us to get to that number in any reasonable amount of time."  


The service's original projections showed it reaching its goal in the 2050s, but Navy brass announced last year the service would reach 355 ships in the 2030s by extending the lives of the Arleigh Burke-class destroyers. Service leadership recently toned down its use of the 355-ship figure, which was derived from a 2016 force structure assessment, in anticipation of a new assessment that is expected to conclude by the end of the year.


Navy Planning Medium UUV Solicitation

The Navy plans to issue a solicitation for a medium unmanned undersea vehicle geared toward mine countermeasures and collecting oceanographic data, according to a Sept. 12 Federal Business Opportunities notice. An industry day is also planned for later this year. "The purpose of this industry day is for the government to brief interested contractors in order to improve industry's understanding of the MUUV prototyping requirement and anticipated contracting approach," the notice states. A final request for proposals is expected in fiscal year 2020.




Dominion Submits Proposal for Largest U.S. Offshore Wind Project

Earlier this week, Dominion Energy announced that it plans to develop the largest offshore wind development project in the U.S. to provide more renewable energy to its customers in Virginia and provide a boost to the offshore wind industry on the East Coast. If approved, the project would be located in the 112,800 acres Dominion Energy currently is leasing from the Bureau of Ocean Energy Management, located 27 miles off the coast of Virginia Beach.


Offshore Wind Gears up for Worker Training

For the past several years, the emerging offshore wind industry has been busy securing state and federal permits, convincing state governments, fishermen, environmentalists and coastal residents of the advantages of wind power and raising capital to finance offshore development. Now attention can turn to creating a workforce that is skilled, trained and ready to jump in when this promising renewable energy sector takes off. The U.S. Department of Energy estimates that 43,000 new jobs will be created in the offshore wind market by 2030, while the Labor Department predicts that wind turbine technicians will be the fastest growing job in the U.S. in the coming decades. 




Cato Jones Act Criticism Prompts Industry Backlash

Hawaii Free Press – 16 September 2019

For over a year the Cato Institute has been highlighting the costly failure that is the Jones Act—and backers of the law have taken notice. In late July, John McCown, the former CEO and chairman of Jones Act carrier Trailer Bridge Inc., penned a column in maritime industry publication American Shipper accusing Cato of “analytical gobbledygook." Rife with half-truths and outright falsehoods, the piece largely centered around the alleged flaws of a report regarding the Jones Act's impact on Puerto Rico that was neither written nor published by Cato. For a debunking of McCown's error-ridden column, please see Cato's rebuttal published by American Shipper here. The Jones Act lobby is concerned that evidence of the law's failure is attracting increased attention. We will continue to press the case for reform.




Bloomberg: China’s Pacific Ambitions Loom Over Trump Talks with Aussie Prime Minister  

Australian Prime Minister Scott Morrison’s lavish visit to the White House on Friday -- including the second State Dinner of Donald Trump’s presidency -- comes at a critical time as both nations seek to counter China’s growing influence in the South Pacific. While China’s growing economic might is the main catalyst of Trump’s trade war, diplomats in Washington and Canberra are increasingly concerned about Beijing’s geopolitical ambitions. There are signs China’s influence is spreading beyond the South China Sea to the Pacific Islands, a region traditionally under U.S. hegemony and on Australia’s doorstep. Read more HERE.


BAE’s San Diego Shipyard to Tandem Dry-Dock Two Destroyers

BAE Systems has received $170.7 million in contracts from the U.S. Navy to perform simultaneous maintenance and repair on two Arleigh Burke-class guided-missile destroyers in its shipyard here, according to a Sept. 18 company release. The shipyard will tandem dry-dock the USS Stethem (DDG-63) and USS Decatur (DDG-73) in October. The synchronized two-ship docking will be a first for the company’s newest dry-dock in San Diego. The contracts include options that, if exercised, would bring their cumulative value to $185 million. Read more HERE


Vigor Kicks Off Construction on the U.S. Army’s Next-Generation Landing Craft

Vigor has officially kicked off construction on the next generation of landing watercraft for the U.S. Army at its new aluminum fabrication facility in Vancouver, Washington. A keel laying ceremony for the vessel, to be named SSG Elroy F. Wells, was held Monday attending by representatives from the U.S. Army, federal and local elected officials, and Vigor employees. The design of the MSV(L) was developed in partnership with BMT and is said to dramatically improve on the capabilities of the current LCM-8. Vigor expects the site to employ up to 400 workers by 2023 building high performance military craft, workboats and aluminum fast ferries in addition to MSV(L). 


NTSB Releases 2018 Lessons Learned from Marine Accidents

The National Transportation Safety Board has released its Safer Seas Digest 2018: Lessons Learned from Marine Accident Investigations. The report provides a summary of 30 marine accidents, the investigative findings of which were issued or adopted in 2018. View the report HERE.


Eastern Launches new 5,100-hp Escort Tug for Bisso Offshore

Eastern Shipbuilding Group has launched the first of two 5,100-hp Z-drive tugs for Bisso Offshore. The launch ceremony was held at Eastern’s Allanton facility. 


VT Halter Marine builds cutting edge vessel

WLOX – David Elliott – 16 September 2019

VT Halter Marine has just completed the first vessel of its kind ever built in America. The tug and barge will deliver liquefied natural gas. The project is a big step forward for shipbuilding in South Mississippi. The 324-foot barge and tug, built in Pascagoula, revolutionizes both the shipping and the energy sectors. Its completion has made history. “It’s the first built-in-America offshore LNG bunkering barge. It can refuel ships. It can also refuel ship-to-shore,” said VT Halter Marine President and CEO, Ron Baczkowski. The barge will launch in October and arrive in Port Canaveral, Florida in the first quarter of 2020.



If you have any questions, please do not hesitate to contact Paula Zorensky on the SCA staff.