Page 23: of Maritime Reporter Magazine (July 15, 1985)

Limits On Overhaul

Competition

Reflecting the diminishing over- haul business and the FY 1985 Ap- propriation conferees instructions,

Navy has dramatically increased the percentage of overhauls earmarked for coastwide competition. Eight of ten East Coast regular overhauls and all five West Coast overhauls will be bid coastwide in FY 1986.

These data are shown in Exhibit 2 and compared to earlier years.

Type Contracts

To Be Awarded

Exhibit 3 shows the shift toward fixed price contracts for future

Navy awards. With the exception of a nuclear carrier overhaul, all regu- lar overhauls in FY 1986 will be fixed price or fixed price incentive awards (the type contract for the carrier overhaul has not yet been decided). Almost all SRA's will be fixed price contracts. Phased main- tenance availability contracts will, however, continue to be cost plus award fee awards.

Type Procurement Planned

Eight out of 15 regular overhauls in FY 1986 will be contracted using invitation for bids (IFB's). RFP-IP procurement will be used for 43 of 69 SRA contracts next year. All but one FY 1986 PMA contract will involve source selection procure- ment. These data are shown in Ex- hibit 4 and compared to earlier years.

Overhaul Contracting

By Ship Type

As shown in Exhibit 5, support ships represent six of the 15 over- hauls scheduled for FY 1986. All are coastwide bids with a fixed price contract to be awarded. Five of the six involve IFB procurement proce- dures.

Four cruiser/destroyer contracts are scheduled for next year. All are to be bid coastwide and fixed price incentive contracts are to be awarded. RFP-2P procedures are to be used in three out of four procure- ments.

All three amphibious ship over- hauls scheduled in FY 1986 are to be competed coastwide and fixed price contracts are planned. Two of the three will involve IFB procure- ment.

No frigate or submarine overhauls are scheduled for commercial yards next year.

RECENT DEVELOPMENTS

Among the recent developments are action on the defense authoriza- tion bill, changes in homeport poli- cy, issues raised about the Kitty

Hawk modernization, and a pro- posed restriction on Navy ship re- pair in Japanese shipyards.

Authorization Bills

Both House and Senate have passed a FY 1986 defense authoriza- tion bill. The Senate version pro- vides defense spending authority of $302.5 billion in FY 1986. The

Circle 313 on Reader Service Card

House version holds spending au- thority to $292.5 billion. House/

Senate conferees will meet this month to reconcile the two bills.

Neither bill dramatically impacts the Navy ship maintenance pro- gram. The Administration re- quested $25.8 billion for Navy oper- ation and maintenance programs in

FY 1986, of which $6.1 billion is for ship maintenance and moderniza- tion. The House bill authorizes $25.1 and the Senate authorizes $25.5 billion. The only direct impact is a provision in the House bill which authorizes an additional $20 million for depot maintenance to reduce ship maintenance backlog.

The legislative process is far from complete. An appropriations meas- ure must be passed and sent to the

President for signature. Ship main- tenance tends to be of more interest to the appropriators than the autho- rizes.

Homeport Policy

OPNAV Note 4700 issued in late

May specifies that all scheduled (continued on page 26)

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