The Navy knows its shipyards are in rough shape. To help solve the problem, officials started an ambitious renovation plan in 2018 that will spend $21 billion over the next two decades.

But the massive shipyard overhaul is off to a rocky start. The backlog of needed improvements is growing, not shrinking; costs are escalating, and in the case of at least one yard, overall facility conditions have gotten measurably worse instead of better.

Navy officials said they are still learning lessons about how to approach the massive recapitalization project for the service’s four aging public shipyards, and that four years into what’s called the Shipyard Infrastructure Optimization Program (SIOP), they now have a better handle on how to control costs.

Jay Stefany, the principal deputy assistant secretary of the Navy for research, development and acquisition said the service is fully committed to what it views as a “once-in-a-century opportunity” to modernize the shipyards, and the service’s 2023 budget reflects its biggest investment in years: $1.7 billion in 2023, and a total of $8.3 billion over the next five years.

“We understand that for SIOP to succeed, we must properly plan and execute the work without impacting the shipyards’ ability to execute their mission,” he told the Senate Armed Services Committee this week. “Balancing SIOP’s needs with the needs of the fleet is and will continue to be a critical and iterative process involving all stakeholders. We are committed to working as a team to ensure the program is ruthlessly executed to avoid impacting fleet operations or ship maintenance periods.”

But despite the Navy’s commitment to recapitalize the facilities, the Government Accountability Office said there are reasons to be worried about how SIOP is going.

The office’s most recent reporting shows the overall project hasn’t made a dent in the deferred maintenance backlog — rather, it’s grown by $1.6 billion over the past five years, and now totals more than $7 billion. Meanwhile, more than half the equipment in the shipyards is now past its planned service life. And at one yard, the Norfolk Naval Shipyard in Virginia, facility condition ratings have gotten worse, not better.

“Big picture, all four of the public shipyards are still rated as poor in terms of overall facility conditions, and we remain gravely concerned about that,” said Diana Maurer, a GAO director for Defense capabilities and management. “The estimated costs for the first three drydock improvement projects have grown from just under $1 billion to nearly $6 billion. That does not bode well for the future costs of the 11 other planned drydock projects. [We’re also] concerned that these increasing drydock costs could crowd out other planned [shipyard] improvements. Drydocks should be a top priority, but they are not the only priority.”

But Navy officials think they now have a better understanding of how to control construction cost growth going forward.

Naval Facilities Engineering Command, which is in charge of striking deals with contractors for the shipyard construction projects, is now engaging in discussions with vendors much earlier in the process. Meanwhile, the Navy has also placed a single senior official in charge of the overall SIOP program, treating it with the same sort of management rigor as it would a major Defense acquisition program.

“One of the lessons was getting the design much more mature before we actually put out a formal estimate,” Stafany said. “I feel like the projects — the ones we have planned in the next five years — are mature enough that there’s not going to be continued growth on those projects. And we have enough funding to do the work we need to do in those years.”

But GAO said there are still a lot of unknowns, partly because the SIOP program isn’t even fully developed yet.

The Navy’s long-term approach calls for each of the four public shipyards to have their own detailed investment plan, called an Area Development Plan. Those detailed planning efforts have been delayed by three years, and the Navy doesn’t currently expect them to be fully drafted until 2025.

And beyond the shipyards’ capacity to meet current ship maintenance demands, Maurer said GAO’s biggest concern is that the sorts of drydocks that will be needed to service the newer classes of nuclear powered ships it’s adding to the fleet in the next couple of decades – the Ford Class carrier and the Virginia Class submarine – don’t exist at all.

Even if the docks could adequately accommodate those ships, the industrial facilities surrounding them aren’t quite up to the task either.

“These shipyards were built well over a century ago to repair wind and steam powered ships. Their layout is far from efficient to maintain nuclear powered vessels,” she said. “Moving the people, equipment and parts necessary to repair a submarine is like trying to drive the century old streets of Boston.”

But the Navy emphasizes the SIOP plan isn’t just about digging out of the huge deferred maintenance backlog. Officials say by the time those area development plans are complete, they’ll have answers for issues like outdated facility layout and inefficient workflows too.

Vice Admiral William Galinis, the commander of Naval Sea Systems Command — which operates the shipyards — said the Navy is consulting its own shipyard workforce to solve some of those problems, as part of a separate effort called Naval Sustainment System-Shipyard.

“We target the workforce for specific things in terms of the barriers that they see,” he said. “Leadership within my organization, and me personally, have been sitting down with small groups of mechanics and supervisors to just kind of have a discussion about whether what we’re trying to get after matches up with some of the challenges that they’re seeing. In some cases, we’re seeing that close lash up. In other cases, we’re not. So we’re really starting to see, down at the trade level at the waterfront, the embrace of some of the improvement initiatives that we’re putting in place. That’s where it needs to start in order to sustain what we’re doing.”

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