Navy shipyards face multibillion-dollar backlog to fix failing facilities, and the problem is worsening

The four shipyards the Navy owns and operates to maintain its fleet are in very bad shape.

The Navy knows this, and has already requested an unprecedented amount of funding to help dig out of the massive backlog of maintenance involving both its ships and the facilities that keep them in good working order. But considering how long the facility problems have been allowed to fester, even the amount of money the Navy has proposed for 2018 seems unlikely to put it on a trajectory to fix the problems.

The shipyard facility maintenance backlog has grown by 41 percent over the past five years, according to a report the Government Accountability Office released last week. The same report revealed a host of details about how severely the shipyards have deteriorated.

For instance, they now include at least four dozen buildings — comprising 1.2 million square feet of space — that are “condemned, uninhabitable, or otherwise unusable” for ship repairs or any other work.

Over the years, the Navy has moved a significant chunk of its shipyard workforce out of those uninhabitable buildings and into what was supposed to be temporary space beside them, in trailer-style offices. But the trailers are now permanent enough that they’re stacked one-on-top of another, with staircases rigged to reach the upper floors. The shipyards now own 650 of those trailers, totaling more than half a million square feet of space.

Although facility deterioration is a pervasive problem across the military services because of conscious decisions by Pentagon officials to assign a low priority to facility sustainment, restoration and modernization accounts, the GAO report highlighted that shipyards are a more extreme example of that phenomenon.

The permanent structures on shipyards that are still occupied have an average rating of 72, according to DoD’s facility condition index, putting them in the lower range of what counts as “poor condition.” Fully 25 percent of the buildings are in “failing” condition (and the Navy says that one in five of those failing facilities is also mission-critical).

And the longer the needed facility repairs have been left on the back burner, the more expensive they’ve become. The total bill to eliminate the maintenance backlog for shipyard facilities was $3.45 billion as of 2011; it’s since grown to $4.86 billion. At the current rate at which the Navy is spending money on shipyard facility repairs ($260 million per year), GAO estimates the backlog won’t be cleared until 2036.

The equipment inside those buildings is also aging much faster than it’s being replaced or upgraded. The report found the average age of a piece of equipment used by shipyard maintenance workers is now longer than its originally-designed useful life, and requests for equipment repairs have increased by 28 percent since just 2008.

Expensive repair bills aside, there’s also the question of how the conditions and layout of facilities and the shipyards impact their ability to move ships through the maintenance process. All four have been up and running since the eras of sail and steam, and are now charged with maintaining nuclear-powered supercarriers and submarines.

The Navy does have a database that’s designed to score each of its industrial facilities according to how well they’re configured to meet current missions. But out of the 1,300 facilities in the database, most of them haven’t been assigned a score by the Navy, despite several years of GAO requests for that data, which is supposed to rate a work area on a score of 0-100 based on its suitability for the mission it’s being used for.

One thing that’s clear, according to GAO, is that the four shipyards do not seem to be capable of meeting the Navy’s current maintenance requirements, at least not in their current state. The conclusion is based on today’s fleet of 277 warships — not the 350 to which the Navy aspires.

Between 2000 and 2016, only 25 of the Navy’s 53 planned maintenance availabilities for carriers were completed on-time. For submarines, only 42 out of 173 were finished on schedule.

The causes are complex, and have to do with other factors, including staffing levels and training, but a main culprit is the condition of the facilities themselves, a situation that bodes poorly for the larger fleet the Navy and congressional backers envision.

Perhaps most glaringly, none of the shipyards’ dry docks can accommodate the new Ford-class aircraft carrier, and only 11 of 18 of those docks will be able to do maintenance on newer versions of the Virginia-class submarine.

But the problem is much more pervasive, according to a new draft Navy planning study GAO cited in its report. The study estimated that based on the current conditions, efficiency levels and capacity in its yards, the service will only be able to support about two-thirds of its actual ship maintenance needs over the next 23 years, a conclusion GAO says may actually be overly optimistic.

In addition to the $4.86 billion needed just to deal with backlogged maintenance requests, the Navy estimates it will need $9 billion over the next 12 years to bring its yards into line with its mission requirements.

But there, too, the service may be underestimating the total costs of upgrading the facilities, since the tally does not include the cost of planning those upgrades or installing new utilities to support new facilities.

“The Navy’s capital investment plans for shipyard facilities and equipment do not include analytically-based results-oriented goals sufficient to support long-term planning,” GAO wrote. “Navy officials also told us that there are no Navy or DoD criteria for determining what constitutes effective and efficient shipyard facilities, although such criteria are available for more typical installation facilities, such as barracks or dining facilities.”

Compounding matters, some of the expenses involved in modernizing the shipyards are firmly outside the Navy’s control, and may well serve as a perverse incentive to leave failing buildings as they are.

That’s at least one of the conclusions one could draw from the Navy’s experience when it decided to replace the windows in Building 30 at Norfolk Naval Shipyard, a structure that’s 120-years old.

Navy planners calculated it made sense also to replace heating and cooling systems and install a new roof at the same time. All told, it was supposed to cost $2.5 million, and should have paid for itself within a few years because of the increased energy efficiency those upgrades would yield.

But it triggered a statutory requirement that DoD facilities also upgrade buildings to current anti-terrorism standards whenever officials conduct major renovations, adding another $6.8 million to the price tag. And since this was now a more-than $9 million project, it met another threshold under current law that also forced additional work for flood protection and asbestos removal, pushing the cost of Building 30’s window replacement program to $34.7 million.

“This example may not be representative of the potential growth of project costs, but the age of shipyard facilities, the extent of historic designations, and the Navy’s acknowledged history of underinvestment at the shipyards highlight the potential for other shipyard facilities to encounter similar issues,” GAO officials wrote in the report. “This suggests that the Navy’s estimated restoration and modernization backlog of $4.86 billion may actually be understated.”

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