The compromise legislation that will keep the federal government funded into Fiscal Year 2025 does not include a $1.95 billion White House request to fund two Virginia-class submarines, according to the draft compromise bill reviewed by USNI News.
The White House requested the money to cover cost increases for two Virginia-class Block V nuclear attack boats that were funded as part of the Fiscal Year 2024 defense bill. As part of the 2024 bill, Congress set aside $9.4 billion for two attack submarines – future USS Baltimore (SSN-812) and SSN-813. The extra money was to pay mostly for increased labor costs that added almost a billion a hull, several sources told USNI News.
While the anomaly was included in an earlier version of the House version of the continuing resolution, the sub funding didn’t make the final version of the bill.
The exclusion of the extra submarine money in the continuing resolution follows a series of closed-door hearings on shipbuilding before the House Appropriations Subcommittee on Defense. Submarine funding was a key topic at both the Thursday hearing with the Secretary of the Navy Carlos Del Toro and Friday with submarine shipbuilders General Dynamics Electric Boat and HII Newport News Shipbuilding.
In addition to the White House request, the panel quizzed Del Toro and the shipbuilders over a Navy-created proposal to change the funding model to build submarines called the Shipyard Accountability and Workforce Support.
SAWS would divide labor costs specific to a submarine hull from general shipyard labor costs. The general shipyard labor fund pool would allow the shipyards more flexibility to increase salaries for yard workers and make capital improvements.
The proposal was under consideration during the negotiation for 17 submarines – the two FY 2024 boats, 10 Block VI Virginia-class submarines and five Build II Columbia-class nuclear ballistic missile submarines – between the Navy and prime submarine contractor EB. However, in the lead-up to the continuing resolution, the Office of Management and Budget elected to move ahead with the anomaly for the two Fiscal Year 2024 boats.
Following the OMB decision, Del Toro did not support the SAWS funding proposal in his hearing before HAC-D.
“He neither justified nor offset the $1.95 billion anomaly. He also did not support policy solutions, including SAWS. We have more work to do,” HAC-D chair Rep. Ken Calvert (R-Calif.) said in comments to Politico.
In a Monday statement to USNI News, a spokesman for Del Toro said, “while the Navy cannot comment on pending legislation, we are both encouraged to see progress and committed to working with Congress to meet our financial goals with the full understanding that we are duty-bound to act as responsible stewards of taxpayer funds.”
The current CR proposal is expected to pass both the Senate and the House, legislative sources told USNI News.
