The following is the Sept. 24, 2020 Congressional Research Service report, Navy Virginia (SSN-774) Class Attack Submarine Procurement: Background and Issues for Congress.
From the report
The Navy has been procuring Virginia (SSN-774) class nuclear-powered attack submarines (SSNs) since FY1998. The one Virginia-class boat that the Navy is requesting for procurement in FY2021 would be the 33rd boat in the class. The Navy’s FY2020 budget submission had projected that the Navy would request two Virginia-class boats in FY2021.
Virginia-class boats scheduled for procurement in FY2019-FY2023 are being procured under a multiyear procurement (MYP) contract. Most Virginia-class boats procured in FY2019 and subsequent years are to be built with the Virginia Payload Module (VPM), an additional, 84-foot-long, mid-body section equipped with four large-diameter, vertical launch tubes for storing and launching additional Tomahawk missiles or other payloads.
The Navy’s FY2021 budget submission estimates the procurement cost of the Virginia-class boat requested for procurement in FY2021 at $3,539.4 million (i.e., about $3.5 billion). The boat has received $915.7 million in prior-year “regular” advance procurement (AP) funding, and $289.0 million in prior-year Economic Order Quantity (EOQ) AP funding for components of boats being procured under the FY2019-FY2023 MYP contract. The Navy’s proposed FY2021 budget requests the remaining $2,334.7 million needed to complete the boat’s estimated procurement cost, as well as $1,473.8 million in “regular” AP funding for Virginia-class boats to be procured in future fiscal years and $427.4 million in EOQ AP funding for components of boats being procured under the FY2019-FY2023 MYP contract, bringing the total amount of procurement and AP funding requested for the program in FY2021 to $4,235.9 million (i.e., about $4.2 billion), excluding outfitting and post-delivery costs.
The FY2019-FY2023 MYP contract for the Virginia-class program includes a total of nine boats (in annual quantities of 2-2-1-2-2), with an option for adding a 10th boat. The contract allows for the 10th boat to be added in either FY2021 (which would make for a total procurement of two Virginia-class boats in FY2021) or a subsequent year. The Navy’s FY2021 unfunded priorities list (UPL) reportedly lists the 10th boat as the Navy’s top unfunded priority for FY2021 and states that fully funding this additional boat in FY2021 would require an additional $2.76 billion in funding.
The Navy’s force-level goal for SSNs is to achieve and maintain a force of 66 boats. The Navy’s SSN force included 50 boats at the end of FY2019. From the mid-2020s through the early 2030s, the number of SSNs is projected to experience a valley or trough, reaching a minimum of 42 boats in FY2027-FY2028. Some observers are concerned that this projected valley could lead to a period of heightened operational strain for the SSN force, and perhaps a period of weakened conventional deterrence against potential adversaries such as China. The projected SSN valley was first identified by CRS in 1995 and has been discussed in CRS reports and testimony every year since then. The Navy’s FY2020 30-year shipbuilding plan projects that, after reaching its projected 42-boat minimum, the SSN force will increase to 66 boats by FY2048.
Issues for Congress regarding the Virginia-class program include the potential impact of the COVID-19 (coronavirus) situation on the execution of U.S. military shipbuilding programs, including the Virginia-class program; whether to provide funding for procuring a second Virginia-class boat in FY2021 (which would be the 10th boat under the MYP contract); the potential industrial-base challenges of building both Columbia-class boats and Virginia-class attack submarines (SSNs) at the same time; and technical risk in the design for the latest (i.e., Block V) version of the Virginia-class submarine.
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