Will the USCG be Properly Funded?

By Charley Havnen

The White House has embarked on a full-scale effort to sell the new federal cabinet level Department of Homeland Security. While the Congress does not seem to oppose the creation of the new department, they will no doubt reshape the make up as the project works its way through the system. Once the Congress starts adding and subtracting from what will go into the agency the process will become quite unpredictable. The stated purpose of the new agency would be to be the repository or clearinghouse of all domestic terrorism intelligence, merging some 22 agencies with 170,000 employees. At first blush it would appear the agency would be driven by the US Customs and Secret Service [both from Treasury] and the Transportation Security Agency [from Transportation (DOT)].

It seems probable that the US Coast Guard will become the performer of simple tasks with only little involvement in the think tank that is being created. Port security in the U.S. has already become the all-consuming issue of focus for the US Coast Guard. Many of us would agree that this action is being done for good and just cause, as our nation is at war, and their duty is clear. Since 9/11 their focus has been on protecting our ports, as it should be. In certain respects the USCG focus on National Security has been to the detriment of their other duties.

It should be apparent to all that they are struggling mightily to perform all of their missions. Within the DOT the USCG has encountered serious budget constraints. By now it has become clear to most Coast Guard watchers that the USCG is not getting the funds necessary to directly increase security in the nations ports. At least, not while performing their other missions. The Coast Guard modus operandi seems to be to encourage and/or demand that various industrial and commercial entities, port authorities as well as state and local law enforcement take up these security tasks with the USCG providing encouragement and oversight.

The recently enacted Department of Defense budget contained approximately $20 billion for homeland defense. In two Fiscal Year (FY) 2002 supplemental appropriations the USCG got sufficient funds to restore monies they spent augmenting their forces by bringing USCG Reservists onto active duty through the end of this fiscal year, September 2002, and what amounted to about a 5% increase in the FY 2002 budget. While that doesn't sound bad, one needs to know more about the story. FY 2002 started October 1, 2001, less than three weeks after 9/11. That USCG budget contained about a 15% reduction from the USCG FY 2001 budget. Because the USCG's largest expenditures are for fuel and wages, costs over which they have little or no direct year-to-year control, a 15% reduction in many respects reflects a reduction of 35% or more on expenditures that they can control on a short term basis. It means they must reduce personnel and reduce every cost that they have any control over as long as it doesn't destroy their overall mission performance.

Similarly, the same sort of budget reduction occurred in 1981 when the USCG was marked for effective elimination by a budget conscious administration. It is questionable whether they ever completely recovered from that assault. The tragedy of 9/11 occurred with the USCG already in a state of crippled response capabilities. The 5% increase in budget only restores the USCG budget to an approximately 10% reduction from the budget of the previous year. Why isn't the USCG screaming to the high heavens about their financial problem? Surely the Administration would not let this occur. After all, port security has become a hot button for everyone in the nation. The problem is that the USCG officials follow orders and do what they are told by their civilian masters within the Administration. There is a law that requires military officers of the Department of Defense to truthfully answer any question put to them by the Congress. The same law does not apply to the U.S. Coast Guard officials who must always state the Administration policy, even if it requires that they shade the truth. Thus they are prevented from reporting the dire straits in which the USCG presently finds itself.

What all of this means is that the USCG has been shifting funds from where the funds are budgeted to where the funds are most desperately needed. When asked the USCG will, of course, respond that the US Coast Guard is adequately funded. Shifting the USCG to a new department will alter the competitive budget process. The Coast Guard is currently competing with FAA for funds as well as with mass transit and highway funding. One can readily hazard a guess as to who gets the money. Changing Departments may change the budget game but will it change the outcome? In the new agency they would be competing with Secret Service, Customs, FEMA and other agencies highly expert in the budget process. Last December the Senate passed a serious Port Security Bill, S.1214. Since then there has been serious jurisdictional wrangling about passage of the Senate bill and or other port security legislation. Some of the concern seems to be over who will get the resources to check incoming containers, Customs Service or the new DOT Transportation Security Agency. If DOT prevails much of the funding will probably go toward setting up a new Department level organization with the USCG performing the grunt work with only a small portion of the funding. There are many bills in Congress that alter the port security picture. The creation of a new Homeland security Department will have a major impact on the overall issue. It appears to many that the USCG future in DOT is very limited from a funding prospective. Will it be any better in the new agency? It may be harder for the USCG to obtain adequate funds from the new department than from the DOT. It is far too early to tell. As always the USCG will do as it's told. It's too bad that the USCG has not worked harder over the years to develop a more positive support base from all the various U.S. maritime stakeholders. It's far too early to predict how all of this will end. Charley Havnen is a Commander USCG Ret. His organization can help you with your vessel construction project, regulatory problems, vessel manning issues, procedure manuals, accident analysis or expert witness. His organization can do what you can't or don't want to do. He can be reached by contacting the Havnen Group: (800) 493-3883 or (504) 394-8933, fax: (504) 394-8869.