The Navy’s decision to cancel the anti-submarine warfare mission package for the Littoral combat ship triggered a Nunn-McCurdy breach, the service told lawmakers Friday.
In a statement, the Navy said it told Congress today that the LCS mission module program “now exceeds the initial benchmark estimate by at least 30% and the current benchmark by at least 15%, exceeding thus the Nunn-McCurdy significant cost growth threshold”.
The breach comes after the Navy, in its fiscal year 2023 budget proposal, decided to eliminate the anti-submarine warfare package from the LCS mission module program, choosing instead to focus the ASW capability on the Constellation-class frigate program.
“Specifically, [Program Acquisition Unit Cost] increased by 37.3% compared to the initial reference value. The PAUC increased by 18.0% and [Average Procurement Unit Cost] increased by 17.2% from the current baseline,” Capt. Clay Doss, spokesperson for Navy acquisitions, said in a statement.
“This cost growth has occurred due to a reduction in the overall quantities of the LCS mission set following the divestiture of the Anti-Submarine Warfare (ASW) MP in the budget presentation of the Chairman for fiscal year 2023 (PB 2023). The total cost of the LCS MM program was then spread over fewer units,” Doss continued.
The Navy’s LCS mission module program was to include three sets of missions – one for anti-submarine warfare, one for surface warfare, and one for mine countermeasures. But the service only deployed the surface warfare mission package, and the other packages experienced delays.
The Nunn-McCurdy provision requires the Pentagon to notify lawmakers when the cost of its high-profile acquisition programs exceeds specific benchmark levels.
“There are two types of violations: significant violations and critical violations. A material violation occurs when the unit acquisition cost of the program (the total cost of development, procurement and construction divided by the number of units purchased) or the unit procurement cost (the total cost of procurement divided by the number of units to be purchased) increases 15% or more above the current benchmark estimate or 30% or more above the original benchmark estimate. A critical breach occurs when the cost increases by 25% or more over the current baseline estimate or by 50% or more over the original baseline estimate,” states a 2016 report from the Congressional Research Service.
The Navy has maintained that the current LCS mission module program breach is not “critical.”
“The LCS MM program is not at increased risk due to this cost violation. This is not a critical Nunn-McCurdy violation that would require recertification of the program,” Doss said.
The service announced during the March budget rollout that it would be canceling the ASW package. The Navy has struggled to deploy the Raytheon AN/SQS-62 Variable Depth Sonar (VDS) on the Freedom-class LCS and the service now plans to deploy Thales’s CAPTAS-4 on the frigates.