Thursday, July 1, 2010

The Balisle Report

The Balisle report is starting to gain traction with the latest reporting in the press. What has been reported in the press already is only a sample of the blunt nature of the report regarding all the issues surrounding Surface Force Readiness. This report is serious and all business, and I mean it when I say the language is blunt and direct. I also find the quality of the report to be very high - rich in detail, and with a quality of depth to many issues.

I currently have no intention to release my copy of this report to the public, although I have to admit that the casual dismissal as a response to the report as reported in Phil Ewing's first news article about the report has me thinking I should just print the whole thing in small pieces on the blog (or the USNI blog actually). The impression that the contents of this report can be casually or flippantly addressed by the Navy kind of ticked me off as a taxpayer. The contents are entirely too serious for such a response.

I'll add to the discussion of the Balisle Report started by Phil Ewing in his press reports to date by quoting from the Financials section which, in theory, should hold some value for our Congressional readers.

Observations/Findings. Surface ship maintenance has been significantly underfunded for over ten years. This is manifesting itself in the degraded material condition of the ships as reflected in recent INSURV reports, corrosion audits, and CASREP data. The decision to transition to condition based maintenance from an engineered operating cycle maintenance resulted in the reduction of over 500 man days per month of depot level maintenance from DDG 51 class ships alone and a corresponding reduction in programmed operations and maintenance dollars for ship depot level maintenance.

While the difference was intended to be compensated by an increase in funding and opportunities for continuous maintenance availabilities throughout the year, that never translated into reality. A clear indicator of the fallout of the lack of funding is the steady increase in TA-4 (ship force capable) level work.

It may legitimately be said that insufficient funding applied over recent years has not been the result of an unwillingness to fund to the requirement as much as the result of not having a properly identified requirement.

For example, as programmed, it may appear that overall ship maintenance is funded at 95-99%. In reality, since we don't know the true maintenance requirement for conventional surface ships (the "denominator"), it is reasonable to assume that our surface ships receive a lower percentage for maintenance funding when compared to a true requirement. Currently as maintenance dollars are allocated by the Fleets, public shipyards (where the majority of CVN and submarine work is performed) are funded at levels between 97-100%. That leaves the balance of the maintenance funding left to be allocated to conventional surface ship maintenance. Currently one of only two items in the CNO's Unfunded Requirement list to Congress is $200M for ship maintenance.

The end result is the surface navy is funded below their identified requirement at the start of the year with the goal of making up the balance as money becomes available during the execution year. This unstable funding environment almost exclusively impacts the private shipyards, where most of the non-nuclear ship maintenance is performed, and results in higher work rates aas jobs get screened into the availability package laer due to uncertainty of funding commitments. The end result is an understanding requirement that has been underfunded in the budgeting process that is frequently going to cost more in actual execution because of an unpredictable funding stream, in other words, a low return for maintenance dollar invested. To further impact material readiness, the surface Type Commander frequently has to make irrevocable mitigation decisions earlier in the fiscal year due to projected uncertain (or unfavorable) levels of funding. If a CNO availability is subsequently canceled, or de-scoped prior to a midyear money bring available, that maintenance most likely will not be made up later in the year. Alternatively, cash flowing throughout the year on the hope that more money will be available later is a tenuous business plan that can leave availabilities scheduled for the end of the fiscal year exposed and unfunded.
I was very tempted not to post or quote any part of the Balisle Report until I read the response given by the Navy to Phil Ewing in his first article. Now that I have read the report in full, this kind of answer doesn't satisfy me, as a taxpayer, none.
Capt. Cate Mueller, a spokeswoman for Fleet Forces Command, said Balisle's report didn't tell the Navy anything it didn't already know.

"Fleet leaders, based upon their own prior analysis, believed that many of the problems that the panel subsequently identified - including manning shortfalls, inadequate shipboard and shore maintenance, and insufficient training - were taking a toll on surface force readiness," she said. "In that regard, the fleet review panel confirmed, in context and in detail, what fleet leaders had suspected."

She also reaffirmed what senior Navy leaders have hinted for the past few months: They're swinging the pendulum in the other direction by looking to increase crew sizes, improve training and re-teach the fleet to maintain its ships and equipment.
If any leader wants to strut around with a position that the findings "didn't tell the Navy anything it didn't already know" then I see serious problems. I understand that some of the issues raised in the report are well known and had previously been identified - ADM Harvey himself has discussed the manpower shortfalls and insufficient training issues on several occasions, and has been direct when discussing solutions. The report is so much more than that though, and if Navy leaders already knew what the report would find - you've been intentionally covering your ass by not disclosing this information to Congress or the taxpayer. The American public deserves a better answer than a 'nothing new here to see' type of response.

The part of the Balisle Report I quoted identifies the absence of a "properly identified requirement" for maintenance funding going back over a decade - meaning that every single Admiral who is also a surface warfare officer has only known the broken system of maintenance that has existed for over the same period of time every single Flag SWO was in major Command.

This report is seriously troubling, and raises legitimate questions regarding the quality of the fleet in reality vs paper, and an even more serious question whether the US Navy is a good steward of taxpayer investment. There are so many areas to discuss that I understand why Phil Ewing is putting out a new article that only covers part of the Balisle Report every week.

If you didn't read Phil Ewing's contribution this week, take a look. That is such an enormous issue it deserves its own blog post, and absolutely should have every Congressman on the HASC demanding to get an informed and impartial brief on the Balisle Report.

I don't see how Gene Taylor avoids a hearing on the findings of this report - because it raises serious questions regarding the quality of testimony the US Navy has been giving the HASC Seapower Subcommittee over the past few years on questions related to maintenance and the quality condition of the surface fleet. The Navy has stated in testimony they are going to extend the surface fleet out to 40 years life, and yet the report makes clear that under the current maintenance condition of the past decade, ships would be lucky to make it past an average of 28 years - below the prior expected life of the ship. WTF? The report also raises serious questions regarding new maintenance concepts in development - LCS comes to mind.

The Balisle Report is too blunt, too detailed, and too revealing of serious problems to go ignored or be casually dismissed as 'something the Navy already knows.' That is an unacceptable dismissal of a rather lengthy and damning report on the status of the surface fleet with detailed analysis of numerous problems.

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