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Ready Reserve Force: Ship Readiness Has Improved, but Other Concerns
Remain (Chapter Report, 11/08/94, GAO/NSIAD-95-24).

Ships move about 90 percent of all dry cargo needed to support U.S.
forces.  The Ready Reserve Force--a government-owned, inactive fleet of
former commercial ships of various types--is the government's largest
source of strategic sealift capability. During the Persian Gulf War, 75
percent of the Ready Reserve Force ships could not be made ready by
their specified deadlines, mainly because of the ships' poor conditions
and because of crewing problems.  This report discusses whether (1)
program changes to address these problems have improved the ships'
overall readiness, (2) the readiness level of the highest priority ships
exceeds that of other strategic mobility components, and (3) a further
decline in the number of available U.S. merchant mariners would have a
long-term effect on crewing Ready Reserve Force ships.

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  NSIAD-95-24
     TITLE:  Ready Reserve Force: Ship Readiness Has Improved, but Other 
             Concerns Remain
      DATE:  11/08/94
   SUBJECT:  Defense contingency planning
             Mobilization
             Logistics
             Emergency preparedness
             Merchant marine
             Military vessels
             Military reserve personnel
             Marine transportation operations
             Combat readiness
             Strategic forces
IDENTIFIER:  Ready Reserve Force
             Ready Reserve Fleet
             Persian Gulf War
             DOD Bottom-Up Review
             DOD Mobility Requirements Study
             Army Joint Logistics Over the Shore System
             DOT Maritime Security Program
             
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Cover
================================================================ COVER


Report to the Chairman, Subcommittee on Readiness, Committee on Armed
Services, House of Representatives

November 1994

READY RESERVE FORCE - SHIP
READINESS HAS IMPROVED, BUT OTHER
CONCERNS REMAIN

GAO/NSIAD-95-24

Ready Reserve Force


Abbreviations
=============================================================== ABBREV

  DOD - Department of Defense
  GAO - General Accounting Office
  MarAd - Maritime Administration
  ROS - reduced operating status
  RRF - Ready Reserve Force

Letter
=============================================================== LETTER


B-256067

November 8, 1994

The Honorable Earl Hutto
Chairman, Subcommittee on Readiness
Committee on Armed Services
House of Representatives

Dear Mr.  Chairman: 

As requested, we reviewed the Ready Reserve Force program.  Our
analysis included the ships' overall readiness, the required
readiness level for the highest priority ships, and the long-term
effect of the decline in the number of available U.S.  merchant
mariners to crew the Ready Reserve Force ships.  This report contains
recommendations to the Secretaries of Defense and Transportation. 

As agreed with your office, unless you publicly announce its contents
earlier, we plan no further distribution of this report until 30 days
from the date of this letter.  At that time, we will send copies to
interested parties and make copies available to others upon request. 

Please contact me on (202) 512-5140 if you or your staff have any
questions regarding this report.  Other major contributors are listed
in appendix III. 

Sincerely yours,

Mark E.  Gebicke
Director, Military Operations and
 Capabilities Issues


EXECUTIVE SUMMARY
============================================================ Chapter 0


   PURPOSE
---------------------------------------------------------- Chapter 0:1

Ships move about 90 percent of all dry cargo needed to deploy,
sustain, and resupply U.S.  forces.  The Ready Reserve Force (RRF)--a
government-owned, inactive fleet of former commercial ships of
various configurations and capabilities--is the government's largest
source of strategic sealift capability.  During the Persian Gulf War,
75 percent of the RRF ships could not be made ready within their
specified time frames principally because of the ships' poor
condition and problems crewing the ships.  In 1992, the Department of
Defense (DOD) recommended spending almost $4 billion over the next 7
years to purchase more ships for the RRF and improve their readiness. 
However, the pool of U.S.  merchant mariners available to crew RRF
ships has been steadily declining for several decades. 

The Chairman, Subcommittee on Readiness, House Committee on Armed
Services, asked GAO to evaluate whether RRF ships would be ready
within specified time frames in the event of a large-scale
contingency.  Specifically, GAO determined whether (1) program
changes implemented to address problems encountered during the
Persian Gulf War have improved the ships' overall readiness, (2) the
readiness level of the highest priority ships exceeds that of other
strategic mobility components, and (3) a further decline in the
number of available U.S.  merchant mariners would have a long-term
effect on crewing RRF ships. 


   BACKGROUND
---------------------------------------------------------- Chapter 0:2

RRF ships are maintained in a readiness status such that they can be
activated for service within 4, 5, 10, or 20 days after DOD requests
them.  The Department of Transportation, through the Maritime
Administration (MarAd), manages and maintains the RRF ships, and DOD
directs and controls operations once the ships have been activated. 
DOD's Transportation Command is responsible for DOD's RRF oversight
and operational control. 

In August 1990, the RRF consisted of 96 ships, 78 of which were
activated to support the Persian Gulf War.  The problems encountered
while activating the ships for the war included numerous equipment
deficiencies caused by improper deactivations when the ships were
acquired into the RRF, inconsistent preservation techniques, weak
ship manager controls, and the lack of detailed records to track
maintenance activities within the fleet. 

DOD's 1992 Mobility Requirements Study recommended that by 1999 the
RRF consist of 142 ships, 63 of which would be kept in a
high-priority readiness status.  Of these 63 ships, 36 would need to
be able to activate in 4 days and 27 would have to be ready in 5
days. 


   RESULTS IN BRIEF
---------------------------------------------------------- Chapter 0:3

MarAd has made significant progress addressing problems it
encountered while activating RRF ships for the Persian Gulf War.  It
has identified and corrected equipment deficiencies, instituted more
uniform and comprehensive specifications for the deactivation and
preservation of RRF ships, strengthened ship manager controls by
expanding and clarifying the manager's contractual responsibilities,
and developed and implemented automated information systems for
tracking maintenance repairs.  MarAd has also implemented new
strategies for maintaining high-priority ships.  Recent testing has
indicated that RRF ships can be made ready to sail within specified
time frames.  However, the success of these activations has resulted
largely from maintenance and repairs performed during and after the
war. 

MarAd's ability to activate ships within 4 or 5 days exceeds the
current readiness level of other strategic mobility components.  The
Army's ability to get unit equipment (e.g., tanks and helicopters)
from key Army installations to seaports is still constrained by
deteriorated facilities.  Although the Army plans to increase its
capability to reach seaports more quickly, most projects will not be
completed by the 1999 time frame set in DOD's mobility study, when 63
RRF ships will be expected to be ready to activate within 4 or 5
days.  Further, the study's recommendation to maintain 63 ships in
this high state of readiness is not justified by DOD's model. 

The decline in the number of available mariners should not
immediately affect MarAd's ability to crew RRF ships.  However, if
the decline continues, MarAd's future ability to adequately crew
these ships is questionable.  Alternatives to resolve this situation,
such as a civilian reserve program, have been proposed, but none have
been adopted. 


   PRINCIPAL FINDINGS
---------------------------------------------------------- Chapter 0:4


      RRF READINESS HAS IMPROVED
-------------------------------------------------------- Chapter 0:4.1

MarAd's changes to the RRF program have addressed problems identified
during the Persian Gulf War.  In 1993, DOD requested, without prior
notice, that MarAd activate six RRF ships to verify their readiness. 
The ships performed excellently:  all six were activated either on
time or earlier and experienced fewer equipment failures than during
their activations for the war.  However, the activations were
requested, on average, only 7 months after the ships had been
deactivated from their service in the war and after almost $30
million had been spent on them. 

MarAd has initiated several strategies to maintain the current
readiness levels of the RRF's high-priority ships.  For example, in
1993, MarAd began assigning permanent, nucleus crews to the highest
priority ships and planned to activate them every year for testing. 
Also, MarAd began assigning two-person crews to the other
high-priority ships and planned to activate them biennially for
testing.  The cost to sustain this high readiness status is much
greater than the amount spent before the war--$3 million per ship
annually compared with about $800,000 per ship annually.  MarAd's
ability to continue the RRF's current high readiness status depends
largely on future maintenance and repair funding levels. 


      RRF READINESS LEVEL EXCEEDS
      OTHER DEPLOYMENT COMPONENTS
-------------------------------------------------------- Chapter 0:4.2

Maintaining today's RRF ships in a relatively high readiness status,
as recommended by DOD's 1992 mobility study report, is not consistent
with the current readiness level of other strategic deployment
components.  For example, the Army's ability to move unit equipment
from key installations to seaports is currently hampered because of
deteriorated rail facilities.  The Army has identified an estimated
$550 million in military construction and operations and maintenance
funding through fiscal year 2001 for various projects that are
expected to increase its capability to transport equipment to ports
more quickly.  However, at current funding levels, some of these
projects will take 15 to 20 years to complete and therefore do not
yet provide the rapid deployment capability assumed in DOD's mobility
study. 

The mobility study's specific recommendation to maintain 63 RRF ships
in a 4- or 5-day, high-readiness status was not supported by DOD's
detailed analysis.  For example, in the specific scenario used to
justify the overall study's recommendations, the computer model
assumed that only 14 RRF ships would need to be ready to load cargo
by the 5th day.  DOD officials could not explain the large
discrepancy between the number of ships used in its model and the
number it recommended be kept in a high readiness status in the
study's final report.  However, they did state that the overall
requirement to maintain 63 RRF ships in a high-priority readiness
status was still valid.  Transportation Command officials are
currently reviewing the RRF's size, composition, and readiness status
to meet surge sealift requirements in the year 2001 as part of a new
DOD mobility study, which is expected to be released in January 1995. 


      LONG-TERM CREWING
      INITIATIVES NEED TO BE
      DEVELOPED FURTHER
-------------------------------------------------------- Chapter 0:4.3

The continuing declining pool of available, qualified U.S.  mariners
may affect MarAd's future ability to adequately crew RRF ships.  DOD
and MarAd have conducted numerous studies on this issue and have
proposed alternative ways to improve the likelihood that RRF ships
will be adequately crewed.  These alternatives include the creation
of a civilian merchant marine reserve and the expansion of the
existing Naval Merchant Marine Reserve.  However, DOD, MarAd, and
others involved in this issue have thus far been unable to reach
consensus on a crewing alternative. 


   RECOMMENDATIONS
---------------------------------------------------------- Chapter 0:5

GAO recommends that the Secretary of Defense direct the Commander in
Chief, Transportation Command, to annually review RRF ship readiness
requirements provided to MarAd and ensure that they are in line with
current military deployment capabilities. 

GAO also recommends that the Secretary of Transportation direct the
Maritime Administrator to annually assess whether an adequate number
of experienced U.S.  merchant mariners would be available to crew RRF
ships within DOD's specified time frames.  If these assessments
indicate that the number of qualified mariners may not be sufficient,
the Secretary should propose a specific merchant marine crewing
alternative to the Congress. 


   AGENCIES COMMENTS
---------------------------------------------------------- Chapter 0:6

Both DOD and the Department of Transportation commented on GAO's
draft report (see apps.  I and II).  DOD concurred with the
recommendation to the Secretary of Defense and stated that RRF
readiness requirements are being reviewed annually in cooperation
with MarAd as part of the budget review.  DOD noted that readiness
levels are also being examined as part of the ongoing Mobility
Requirements Study Bottom-Up Review. 

Transportation partially concurred with the recommendation to
annually assess the number of qualified U.S.  mariners available to
crew RRF ships and, if necessary, report crewing options. 
Transportation stated that it maintains maritime workforce statistics
on the size and the composition of U.S.  merchant mariners.  It does
not report this information to the Congress in conjunction with
defense requirements.  GAO believes that MarAd's assessment would be
an appropriate first step to define the effect that the declining
U.S.  merchant marine pool has on national security. 

Transportation said that the recommendation should focus on the need
for reemployment rights legislation for U.S.  merchant mariners if
called upon to serve during a war or national emergency.  It pointed
out that reemployment rights were discussed in GAO's report.\1 GAO
disagrees with Transportation.  GAO has advised the Congress that the
passage of reemployment rights for mariners equivalent to the rights
and benefits provided any member of a reserve component of the Armed
Forces is a fair and equitable measure.\2 GAO continues to believe
that the primary focus should be on the continuing decline in the
pool of experienced U.S.  mariners and having an adequate number
available to crew RRF ships.  Although reemployment rights could be a
positive influence, this incentive's impact cannot yet be determined. 
GAO believes that an annual assessment of the crewing issues could
clearly identify specific actions needed to meet defense objectives. 

 


--------------------
\1 Strategic Sealift:  Summary of Workshop on Crewing the Ready
Reserve Force (NSIAD-94-177, June 6, 1994). 

\2 Management Reform:  GAO's Comments on the National Performance
Review's Recommendations (GAO/OCG-94-1, Dec.  3, 1993). 


INTRODUCTION
============================================================ Chapter 1

The Ready Reserve Force (RRF) is a government-owned, inactive fleet
of former commercial ships of various configurations and capabilities
that should be ready to sail within 4, 5, 10, or 20 days in response
to national emergency sealift requirements.  The RRF was organized in
1976 with
30 ships drawn from the 360 ships in the National Defense Reserve
Fleet, which was created in 1946 to be able to respond to national
emergencies.\1 During fiscal year 1994, the RRF consisted of 108
ships.  The fleet is expected to increase to 142 ships by 1999 in
accordance with the Department of Defense's (DOD) Mobility
Requirements Study and defense plans. 


--------------------
\1 The RRF was initially called the Ready Reserve Fleet and was
renamed the Ready Reserve Force in 1982. 


   ORGANIZATION AND MANAGEMENT OF
   THE RRF
---------------------------------------------------------- Chapter 1:1

The Department of Transportation, through the Maritime Administration
(MarAd), manages and maintains RRF ships, and DOD directs and
controls operations once the ships have been activated.  The Military
Sealift Command, under the Transportation Command, carries out DOD's
oversight and operational control responsibilities. 

RRF ships are berthed at Reserve Fleet sites located in James River,
Virginia; Beaumont, Texas; Suisun Bay, California; and other
locations in the United States and overseas.  MarAd contracts with
ship managers, who are responsible for activating, maintaining,
crewing, operating, and deactivating the ships as directed.  The
American Bureau of Shipping and the U.S.  Coast Guard conduct
periodic limited inspections of the ships for compliance with marine
safety regulations.\2 The ship managers are required to ensure that
the ships are fully operational once MarAd notifies them to activate
the ships.  The Military Sealift Command designates a ship as being
fully operational when, among other things, a complete crew has been
provided, all required regulatory certificates have been obtained,
and sea trials have been performed. 


--------------------
\2 American Bureau of Shipping surveyors periodically inspect
merchant vessels and certify that ships are structurally sound and
mechanically fit. 


   RRF USE DURING THE PERSIAN GULF
   WAR
---------------------------------------------------------- Chapter 1:2

Of the 96 ships that were in the RRF in August 1990, 78 were called
upon to support the Persian Gulf War.  This was the first large-scale
activation and employment of the RRF since it was separated from the
National Defense Reserve Fleet.  These ships transported nearly
one-fifth of the dry cargo deployed.\3 However, ship activations were
not as timely as planned--only 25 percent of the activated ships met
their assigned readiness goals.  Although insufficient fiscal year
1990 maintenance funding has been cited as a major reason for many
late activations, a Department of Transportation Inspector General
report attributed ships' mechanical and crewing problems as the
primary reasons the RRF ships were not able to meet specified
activation times. 

Mechanical problems were attributed to (1) the poor condition of the
ships when they were purchased for the RRF, (2) the age of the ships'
equipment, (3) improper steps taken to deactivate the ships, (4) the
ships' lack of use, (5) shipyard repairs and upgrades not being
tested upon completion, and (6) uncorrected deficiencies identified
during the periodic Coast Guard inspections and during specified
fleet maintenance procedures.  The Transportation Inspector General
reported that 45 of the 79 ships activated for the Persian Gulf War
had not been operated since their acquisition and acceptance into the
RRF. 

The Transportation Inspector General also reported that mariners must
be onboard the activating ships at specified times and should be
knowledgeable of the ships and their operating systems.  They are
responsible for testing and operating all components and systems
required to make the ships operational.  Crewing problems during the
war were caused by crew members that arrived late, lacked knowledge
of the specific ship and operating systems, or had to be replaced
because of crew turnover. 


--------------------
\3 The remainder of U.S.  sealift was provided by DOD-controlled
ships, including fast sealift ships, preposition force ships, and
commercial U.S.-flag ships. 


   OBJECTIVES, SCOPE, AND
   METHODOLOGY
---------------------------------------------------------- Chapter 1:3

The Chairman, Subcommittee on Readiness, House Committee on Armed
Services, asked us to evaluate whether RRF ships would be ready
within specified time frames in the event of a large-scale
contingency.  Specifically, we determined whether (1) the changes
implemented to address problems encountered during war activations
have improved the ships' overall readiness, (2) the readiness level
of the highest priority ships exceeds that of other strategic
mobility components, and (3) a further decline in the number of
available U.S.  merchant mariners would have a long-term effect on
crewing the force. 

To determine whether the overall readiness of the RRF had improved
since the Persian Gulf War, we compared selected ships' 1990 and 1993
activation performance.  The selected ships included those activated
in 1993 for purposes other than testing post-war repairs.  We
reviewed MarAd, Military Sealift Command, Coast Guard, and American
Bureau of Shipping records, as well as related external studies, to
determine the length of activation, significant machinery failures,
and costs. 

We identified and reviewed program modifications initiated since the
war.  We visited ships on the East, Gulf, and West Coasts;
interviewed officials from the Military Sealift Command, the U.S. 
Coast Guard, the American Bureau of Shipping, MarAd, the Merchant
Marine Academy, and unions, as well as RRF crew members and ship
managers; and reviewed studies and documents to assess the relative
benefits of these program changes.  We examined the status and effect
of post-war repair expenditures, changes in MarAd's policies for
maintaining and preserving the ships, changes to MarAd's contractual
agreement with ship manager companies, and new automated maintenance
management systems.  We also assessed MarAd's plans for maintaining
the readiness of the RRF and the consequences of reduced funding. 

To determine the appropriate readiness status for the RRF, we
obtained and analyzed data on several strategic mobility factors that
may diminish the need for RRF ships to be maintained in a
high-priority status.  We analyzed the Mobility Requirements Study's
volume I and II reports, using the Middle East scenario, to determine
the times specific types of ships first loaded, the ports that were
assumed to be loading cargo within the first 30 days, and the
locations and readiness goals set in the study.  We discussed our
analysis with Joint Chiefs of Staff officials. 

We reviewed the Army's Strategic Mobility Program's Management Plan
to identify funding and plans for improvement to the continental
United States infrastructure that would increase the mobility of
selected military units to their seaports of embarkation.  We
discussed the status of these improvements with Army headquarters,
Forces Command, Transportation Command, and Military Traffic
Management Command officials. 

To determine the current and future availability of crews, we
reviewed Persian Gulf War RRF activation data, RRF crewing
requirements, and labor availability estimates.  We sponsored a
workshop on April 5, 1994, to discuss the impact of the declining
merchant marine pool on U.S.  sealift capability, identify
impediments in crewing RRF ships, and reach consensus among the
participants on how to address the issues discussed.  We issued a
report,\4 that provided a summary of views expressed at the workshop. 

We have issued several other products on issues related to the RRF. 
In our testimony, \5 we discussed several issues related to U.S. 
mobility capabilities that need to be resolved, including the Army's
current ability to get cargo to the ports.  In our letter to the
Maritime Administrator (GAO/NSIAD-94-96R, Jan.  7, 1994), we provided
information on the latest selection of 12 roll-on/roll-off ships for
the RRF.\6

We stated that these ships would provide 1.6 million square feet of
additional deck space for surge requirements, thereby increasing the
fleet's roll-on/roll-off cargo capacity by 40 percent.  Three of the
ships have been upgraded to U.S.  specifications, and the other nine
ships are expected to be completed by November 1994.  Two of these
ships are serving as Army prepositioning ships.  A complete list of
related GAO products appears on the last page of this report. 

We conducted our review between August 1993 and June 1994 in
accordance with generally accepted government auditing standards. 


--------------------
\4 Strategic Sealift:  Summary of Workshop on Crewing the Ready
Reserve Force (GAO/NSIAD-94-177, June 6, 1994). 

\5 Strategic Mobility:  Serious Problems Remain in U.S.  Deployment
Capabilities (GAO/T-NSIAD-94-165, Apr.  26, 1994). 

\6 Roll-on/roll-off ships are important to the RRF because they can
quickly load and unload track and wheeled vehicles such as tanks and
trucks.  The mobility study recommended that 19 more roll-on/roll-off
ships be added to the RRF. 


RRF READINESS HAS IMPROVED SINCE
THE PERSIAN GULF WAR
============================================================ Chapter 2

MarAd has made significant progress in implementing changes to
address problems encountered while activating RRF ships for the
Persian Gulf War.  It identified and corrected equipment
deficiencies, instituted more uniform and comprehensive
specifications for the deactivation and preservation of RRF ships,
strengthened ship manager controls by expanding and clarifying the
manager's contractual responsibilities, and developed and implemented
automated information systems for tracking maintenance repairs. 
MarAd also initiated programs, such as assigning permanent, nucleus
crews onboard high-priority ships to help maintain the RRF's material
condition achieved after the war and alleviate crewing concerns. 
Total RRF program expenditures between fiscal years 1990 and 1993
were more than $1 billion when Persian Gulf War activation and
deactivation costs are included.\1

Recent activations of the RRF have demonstrated the ships' ability to
meet readiness requirements and operate with fewer mechanical
failures.  These successful activations resulted largely from
maintenance and repairs made during and after the war.  In fact,
activations without prior notice occurred an average of only 7 months
after the ships had been deactivated from the war.  However,
continuing the present high readiness status of the RRF ships depends
on MarAd's future budgets and maintenance strategies. 


--------------------
\1 This figure includes $139 million to activate and $296 million to
deactivate the RRF during the war.  In addition, MarAd was funded
$615 million during fiscal years 1990 through 1993 for RRF
maintenance and operations. 


   MARAD HAS ADDRESSED WARTIME
   PROBLEMS
---------------------------------------------------------- Chapter 2:1

MarAd spent more than $1 billion to resolve mechanical, management,
and crewing problems encountered during Persian Gulf War activations. 
Problems targeted were the poor condition of the ships upon entry to
the force; improper deactivation, as well as insufficient
preservation and maintenance techniques; insufficient monitoring of
ship manager companies; unknown, deferred, or unreported equipment
deficiencies; and inadequate crewing.  MarAd has made significant
progress toward solving those problems. 


      EQUIPMENT DEFICIENCIES WERE
      IDENTIFIED AND CORRECTED
-------------------------------------------------------- Chapter 2:1.1

The war experience enabled MarAd to identify and repair equipment
deficiencies at an average cost of $5.5 million per ship.  These
repairs had been deferred because many of the ships had been laid up
since being acquired for the RRF.\2

Many ships had been added to the RRF with many known and unknown
machinery deficiencies, and MarAd lacked the funding at that time to
activate, fully inspect, and repair many of the ships.  In fact,
prior to the war, only 34 ships had been activated since entering the
RRF. 


--------------------
\2 Before the war, RRF ships were maintained in an inactive status
(known as lay-up) with all systems down, ship openings sealed, and
interiors dehumidified.  The ships received limited inspections and
maintenance due to the inactive status of the machinery. 


      PRESERVATION AND MAINTENANCE
      TECHNIQUES WERE IMPROVED
-------------------------------------------------------- Chapter 2:1.2

Improper deactivation and inconsistent preservation maintenance
techniques for RRF ships contributed to mechanical problems
encountered during war activations.  Inadequate lay-up and
maintenance techniques contributed to boiler problems, clogged pipe
systems, freeze damage, and impurities in lubrication systems.  After
the war, MarAd instituted more uniform and comprehensive
specifications for the deactivation and preservation of RRF ships. 
For example, to reduce corrosion in boiler tubes--a problem for
steam-powered ships laid up in colder climates--some boiler panels
are now left uncovered, and fans and heaters are installed to improve
the circulation of dehumidified air to prevent freezing.  These new
techniques, however, have raised the cost of standard maintenance
procedures. 


      SHIP MANAGER CONTROLS WERE
      STRENGTHENED
-------------------------------------------------------- Chapter 2:1.3

Some ship managers contributed to activation delays during the war
because of their lack of capability.  For example, two ship managers
were unable to activate their ships due to their lack of knowledge. 
(These managers' contracts were subsequently canceled.) As a result
of this and other contract management difficulties during the war,
MarAd expanded and clarified ship managers' contractual
responsibilities at an estimated annual cost increase of $18,000 per
ship.  The new contracts raise the standards of technical competence,
increase the number of technical employees per ship, clarify
penalties, and emphasize monitoring ship manager performance. 


      AUTOMATED MAINTENANCE
      INFORMATION SYSTEMS WERE
      DEVELOPED
-------------------------------------------------------- Chapter 2:1.4

Before the war, RRF ship logs and machinery history records appear to
have been randomly kept by the chief and port engineers.  For
example, according to MarAd officials during the war activation, one
of five similar ships had recently had an engine overhaul, but MarAd
personnel and ship managers were unsure which ship had been repaired. 
Up-to-date inventories of vital components and spare parts were also
not available for the aging machinery on the RRF ships, which caused
activation delays while some parts had to be manufactured and shipped
to the activation sites. 

After the war, MarAd implemented automated systems for tracking
maintenance, repairs, and spare parts inventories.  A Maintenance and
Repair Tracking System has been developed by MarAd officials and
contractors, and all repair funding requests must now be supported by
deficiencies recorded in this system.  Contractors have also
developed an automated system for maintaining spare parts records and
are completing inventories of shipboard spares to update the system's
records.  As of April 1994, MarAd had invested $26 million in its new
logistics program, and annual spare parts costs are estimated to be
$70,000 to $80,000 per ship. 


      SHIP OUTPORTING WAS IMPROVED
-------------------------------------------------------- Chapter 2:1.5

The location of the RRF ships at the time of the war degraded the
ships' ability to be activated within planned time frames.  Every
ship required some maintenance at a shipyard before reaching its
designated loading seaport.  Although half the RRF ships were
outported--berthed at locations other than the three MarAd reserve
fleet sites--they were not necessarily located near a shipyard. 
During activation for the war, the number of ships requiring
simultaneous activation in a given location sometimes exceeded the
capacity of the local shipyards.  As a result, queuing occurred, and
some ship activations were delayed. 

When reassigning ships to a particular location, MarAd officials
considered factors such as towing time; likely congestion in
shipyards; and, for high-priority ships, transit times to likely
seaports of embarkation.  By fiscal year 1994, MarAd had reassigned
most RRF ships accordingly.  For example, 5- and 10-day ships have
been better distributed according to shipyard facilities for
activation, and the high-priority 4-day ships have been positioned
closer to their ports of embarkation because they do not require
shipyard services to be activated. 


      KEY PERSONNEL ARE BEING
      ASSIGNED TO SHIPS IN REDUCED
      OPERATING STATUS
-------------------------------------------------------- Chapter 2:1.6

To address the problems of identifying crews and transporting them to
the ships in a timely manner, MarAd placed the highest priority ships
in reduced operating status (ROS) with permanent, nucleus crews
onboard.\3 These crews form the core of the required operating crew,
which ensures that key personnel needed for swift activation are
onboard ships.  According to MarAd, about 50 percent of the senior
engineers and 34 percent of the junior engineers required by the RRF
are already serving onboard ROS ships. 

The current crew structure on a ROS ship consists of a Chief
Engineer; 1st, 2nd, and 3rd assistant engineers; a qualified member
of the Engineering Department; an electrician; a chief mate; a bosun;
a steward/cook; and a steward/utility.  The crew's familiarity with
the ship's particular operating systems and characteristics can avoid
costly and time-consuming activation delays.  For example, during the
war, one newly assigned crew could not keep the steam propulsion
system operating shortly after the ship had been loaded and left the
port.  The ship had to be towed back to port, where shipyard
personnel that assisted in the ship's activation restored the system
within 30 minutes.  ROS crews could also help newly arriving crew
members make the transition to a level of full competence on an
unfamiliar ship. 


--------------------
\3 The highest priority ships are roll-on/roll-off ships that are
required to be ready to load military cargo at the seaport by day 4
of an activation. 


   RECENT ACTIVATIONS SHOW THAT
   RRF READINESS HAS IMPROVED
---------------------------------------------------------- Chapter 2:2

Comparisons of recent activations to those during the war demonstrate
that MarAd's efforts to improve readiness have been successful. 
Sixteen of the 20 ships we reviewed had been activated for the war
and were an average of 11.6 days late.  In 1993, some of those 20 RRF
ships were activated earlier than Military Sealift Command or MarAd
criteria; they were activated more quickly with fewer, less
significant equipment failures and at less cost.  Military Sealift
Command, American Bureau of Shipping, and MarAd officials agree that
the improved readiness of RRF ships is largely due to the extensive
repairs made during and after the war. 

Six of the 20 ships were activated without prior notice to test their
readiness and therefore the tests were the most realistic tests of
the RRF's ability to meet defense requirements.  All six ships were
activated on time or earlier than the time required, and the average
cost to activate them was about $1 million less than during the war. 
The ships had been inactive between 6 and 9 months, or an average of
7 months, before their unannounced activations.  Tables 2.1 and 2.2
compare the time and cost for five of the ships activated without
notice both in wartime and in 1993.\4



                          Table 2.1
           
            Comparison of the Persian Gulf War and
           1993 Activation Times for Selected Ships


                                   Time to           Time to
Ship                      Status  activate  Status  activate
------------------------  ------  --------  ------  --------
Cape Breton                5 day    5 days   5 day    4 days
Cape Inscription           5 day    5 days   4 day    3 days
Cape Isabel                5 day   11 days   4 day    3 days
Comet                      5 day   15 days   4 day    3 days
Meteor                     5 day   15 days   4 day    4 days
------------------------------------------------------------


                                    Table 2.2
                     
                      Comparison of the Persian Gulf War and
                     1993 Activation Costs for Selected Ships

                              (Dollars in millions)


                                           Number of
            Activation  Deactivation          months    Activation  Deactivation
Ship              cost          cost     deactivated          cost          cost
--------  ------------  ------------  --------------  ------------  ------------
Cape             $0.70         $3.40               6         $0.44         $0.92
 Breton
Cape              0.90          3.70               9          0.52          0.10
 Inscrip
 tion
Cape              1.53          5.58               6          0.35          0.10
 Isabel
Comet             2.47          5.57               7          0.26          0.46
Meteor            2.00          4.01               7          0.48          0.35
================================================================================
Total            $7.60        $22.26                         $2.05         $1.93
Average          $1.52         $4.45               7         $0.41         $0.39
--------------------------------------------------------------------------------
For both the wartime and 1993 activations without prior notice, DOD
reimbursed MarAd for activation and deactivation costs.  Specific
data that compares two of the five ships' recent tests and wartime
activations follow: 

The Cape Isabel, a steam-powered ship, was built in 1976, added to
the RRF in 1986, and laid up until its activation for the war in
August 1990.  During its wartime activation, the ship had many
equipment failures in its boiler system, fuel system, evaporators,
and service generator.  After the war, MarAd spent almost $5.6
million improving the ship's habitability and overhauling its steam
engine and other major equipment.  In 1993, the ship was activated
without prior notice and, according to the after-action report,
overall ship systems operated well during the activation and the sea
trial. 

The Comet, a steam-powered ship built in 1958, was added to the RRF
in 1985, and laid up until its wartime activation in August 1990. 
During this activation, the ship encountered numerous problems with
its steam plant, ballast tank pumps and indicators, salt water
service systems, electrical equipment, and service generator.  During
postwar deactivations, MarAd spent almost $5.6 million overhauling
the ship.  When the ship was activated without notice in 1993, no
major deficiencies were reported during the activation or the sea
trial. 

The remaining 14 ships we reviewed were activated on less demanding
schedules for either sea trials or operations.  These activation
costs were on average about $0.6 million less than during wartime
activations.  Also, there were fewer and generally less critical
equipment failures and fewer delays in making these repairs. 


--------------------
\4 The sixth ship was not activated during the war. 


   NEW STRATEGIES TO SUSTAIN
   READINESS DEPEND ON FUNDING
   AVAILABILITY
---------------------------------------------------------- Chapter 2:3

MarAd has initiated RRF maintenance strategies that will sustain
fleet readiness.  These strategies combine various actions taken
after the Persian Gulf War to solve activation problems at an annual
cost of $3 million for a 4- or 5-day ship compared with $800,000 for
an average ship before the war.  MarAd believes that these strategies
should provide reasonable assurance that MarAd can activate RRF ships
within required time frames.  Table 2.3 identifies the major
components of MarAd's current maintenance strategies. 



                          Table 2.3
           
            Strategies for Maintaining Various RRF
                       Readiness Levels


Major components          4 days        5 days       10 days
------------------  ------------  ------------  ------------
Number of ships\a             36            27            39
Annual cost per            $3.12         $3.09         $2.15
 ship (in
 millions)
Deactivation                 ROS   Fully laid-   Fully laid-
 status                                     up            up
Location               Outported     Outported     Mostly at
                                                     Reserve
                                                  Fleet site
Crew size                     10             2             0
Activation            Annual sea   Annual dock   Annual dock
 frequency                trials       and sea       and sea
                                        trials        trials
Performance of      Continuously  Semiannually  Semiannually
 preventative        by the crew            by      by fleet
 maintenance                        industrial     personnel
                                   contractors
------------------------------------------------------------
\a These numbers are based on DOD's Mobility Requirements Study. 
MarAd also plans to maintain 40 ships in a 20-day readiness status. 

The ROS concept and the annual test activations are significant
changes to the RRF maintenance program.  MarAd cannot be certain that
funding will be available in the future to continue all of its
preferred maintenance strategies and has begun examining variations
within its overall RRF maintenance program.  For example, MarAd
assigned one 14-person crew onboard two roll-on/roll-off ships
berthed together, and it is considering placing all 5-day ships in
ROS with 9-person crews onboard. 

MarAd's fiscal year 1994 RRF budget request submitted to the Congress
for maintenance and operations was $136 million, or approximately
$221 million less than the $357 million identified in the Mobility
Requirements Study.  To make up this difference, only 11 of the
designated 22 4-day ships currently have permanent, nucleus crews. 
Also, the number of planned maintenance test activations was reduced
from 93 in accordance with mobility study standards to 32.  MarAd
officials concluded that reduced funding in fiscal year 1994 would
not result in a great degradation of readiness.  Although budget
constraints are expected to continue, MarAd's fiscal year 1995 budget
request includes $246 million for maintenance and operations. 


   CONCLUSIONS
---------------------------------------------------------- Chapter 2:4

The readiness of the RRF has improved since the Persian Gulf War due
to the $1 billion invested in the program.  Officials from the
Military Sealift Command, American Bureau of Shipping, and MarAd
agree that the satisfactory readiness of RRF ships is primarily due
to the identification and repair of machinery deficiencies during and
after the war.  Despite this investment, however, these officials
could not say how long the ships will stay as ready.  They agree that
continuing the present readiness status of RRF ships depends on
MarAd's future budgets and maintenance strategies. 


RRF READINESS EXCEEDS OTHER
DEPLOYMENT COMPONENTS AND IS NOT
SUPPORTABLE
============================================================ Chapter 3

On the basis of DOD's 1992 Mobility Requirements Study, MarAd plans
to keep 63 RRF ships in a high state of readiness (i.e., ready to
activate within 4 or 5 days) starting in fiscal year 1996.  However,
this high state of readiness exceeds the Army's ability to transport
heavy equipment, such as large vehicles, tanks, weapon systems, and
helicopters, to seaports for initially deploying units.  Army
deployment operations are hindered in the continental United States
by deteriorating transportation-related facilities and overseas by
its limited ability to unload ships in underdeveloped seaports. 
Moreover, DOD's mobility study's recommendation to keep
63 RRF ships in a high readiness status is not justified by the
detailed study analysis. 


   DETERIORATED INFRASTRUCTURE
   CONSTRAINS ARMY OPERATIONS
---------------------------------------------------------- Chapter 3:1

In the event of a large-scale contingency, the Army must be able to
deploy heavy divisions rapidly from the continental United States.\1
These divisions are located at Fort Stewart and Fort Benning,
Georgia; Fort Campbell, Kentucky; and Fort Hood and Fort Bliss,
Texas.  The movement of people, equipment, and supplies to ports of
embarkation is the first stage of a major operation, called "fort to
port" movement.  Figure 3.1 displays the fort to seaport movement for
selected heavy divisions. 

   Figure 3.1:  Key Fort to Port
   Movements

   (See figure in printed
   edition.)

   Source:  GAO.

   (See figure in printed
   edition.)

We reported in 1992 that fort to port cargo movement during Operation
Desert Shield was constrained by deteriorated rail facilities that
could have threatened the Army's ability to move equipment to
seaports rapidly.\2 Although the equipment reached the ports on time
despite serious rail deficiencies, movement of equipment for Desert
Shield was on a smaller scale and took a longer time than strategic
mobility plans require today.  Current deployment plans call for
moving the same amount of cargo in
8 weeks that was moved during the first 6 months of the Persian Gulf
War. 

The Army has a plan that identifies needed improvements to the
transportation infrastructure in the continental United States to
meet the cargo flows assumed in DOD's mobility study.  The Army's
plan identifies improvement projects such as acquiring rail cars and
upgrading or constructing facilities, highway, and rail networks and
ports for receiving, storing, and loading Army equipment and
supplies.  These improvements are projected to cost about $550
million and be funded through fiscal year 2001.  As of August 1994,
only $28 million had been spent on these projects.  At the Army's
planned funding levels, some projects will take 15 to
20 years to complete and, therefore, will not be in place by the 1999
time frame assumed in the mobility study. 

Army officials acknowledged that many infrastructure conditions
remain essentially the same since the war.  The deployment problems
of three key contingency divisions and the improvements identified by
the Army are discussed below.  (The Mobility Requirements Study
assumes that these three divisions are a part of an early response.)

The 101st Airborne Division (Air Assault) deploys from Fort Campbell,
which is approximately 630 miles from its seaport of embarkation in
Jacksonville, Florida.  The mobilization plan for this division
relies heavily on the use of rail transportation.  However, this
method of transportation could not be used during Desert Shield
because of deteriorated conditions and limitations of the
Hopkinsville, Kentucky, rail interchange. 

The Army has identified approximately $23 million in infrastructure
improvements that are necessary to meet the requirements in DOD's
mobility study.  Projects identified include rail upgrades,
additional track (for a Hopkinsville bypass), and a pallet warehouse. 
In addition, 200 rail cars are to be acquired for Fort Campbell to
execute the mobility plans.  At the time of

The 1st Cavalry Division deploys out of Fort Hood, which is about
320 miles from its seaport of embarkation in Beaumont, Texas.  The
division's mobilization plan calls for the lead brigade to move to
this seaport by rail.  However, the existing rail system at Fort Hood
cannot support these deployment requirements, according to the
Military Traffic Management Command's 1993 Engineering Study. 

Infrastructure improvements totaling $69 million have been
identified.  Projects include rail upgrades, additional tracks for
storing and switching rail cars, a warehouse, and airfield upgrades. 
In addition, 512 rail cars are needed for prepositioning at this
installation, but only 14 percent had been delivered at the time of
our review. 

The 24th Infantry Division (Mechanized), stationed at Fort Stewart is
only 40 miles from its designated seaport of embarkation in Savannah,
Georgia.  Fort Stewart was one of the first units during Desert
Shield to transport large numbers of heavy tracked vehicles by rail. 
However, train speeds were restricted to 10 miles per hour or less,
compared with 25 miles per hour under normal circumstances, because
of deteriorated rail conditions.

Fort Stewart needs $30 million in infrastructure upgrades and
construction to meet deployment goals.  Projects identified include
rail passing tracks, a container handling facility, and a cargo
staging area.  Of the 220 rail cars needed to meet mobility
requirements, 42 percent are currently located at the fort. 

The Army believes that many infrastructure improvements have been
accomplished that are necessary to support the initial surge units,
as demonstrated by readiness exercises.  The Army conducts these
exercises to train heavy units in the continental United States on
strategic deployment.  However, only a portion of a division takes
part in the exercises.  For example, in September 1993, the Army
conducted an exercise moving selected military equipment for a
brigade task force of the 1st Cavalry Division from Fort Hood to
Beaumont.  The equipment used for this exercise only accounted for
474 of 1,975 pieces of the brigade task force.  In 1994, the Army
conducted a similar exercise with 900 pieces of equipment.  Movement
of an entire division has not yet been tested in the exercises to
date. 


--------------------
\1 Heavy divisions consist of the armored and mechanized units that
are trained for mobile warfare and equipped with tanks and armored
fighting vehicles. 

\2 Operation Desert Shield:  Problems in Deploying by Rail Need
Attention (GAO/NSIAD-93-30, Nov.  13, 1992). 


   ABILITY TO UNLOAD SHIPS IS
   LIMITED IN UNDERDEVELOPED
   OVERSEAS PORTS
---------------------------------------------------------- Chapter 3:2

The Army's ability to meet its mobility requirements is also affected
by its capability to deliver forces to underdeveloped or damaged
overseas seaports.  The Joint Logistics Over the Shore is a system of
floating causeways that the Army can use to unload ships when the
ships cannot enter a foreign seaport.  As part of that concept,
auxiliary crane ships will be used to unload RRF ships.  Overall, the
auxiliary crane ships are not kept in as high a readiness status as
the surge cargo ships.  Of the nine crane ships in the RRF, four are
maintained in a 5-day status and five are maintained in a 10-day
status. 

The Army plans to unload equipment and supplies from ships within
48 hours of the ships reaching their overseas destination.  A recent
DOD Inspector General report determined that the Army would not be
able to meet its 48-hour requirement if all the factors--including
the ships' distances from shore, the ocean conditions, the number of
crane ships available, and the number of watercraft (small ships,
tugboats, and floating causeways)--were not optimal.  Army officials
are planning on improving the effectiveness of the Joint Logistics
Over the Shore concept through training and additional acquisition. 


   SURGE SEALIFT REQUIREMENTS ARE
   NOT SUPPORTABLE
---------------------------------------------------------- Chapter 3:3

The mobility study examined a range of potential crises, including
regional wars in Europe, the Middle East, and Korea, in the 1999 time
frame.  The most logistically demanding scenario examined, because of
the number of forces and the distances involved, was a major regional
war in the Middle East.  DOD used a model's\3 results to support the
study's recommendation that the RRF maintain 36 ships in 4-day status
and 27 ships in 5-day readiness. 

Our analysis of DOD's model for the Middle East scenario does not
support the study's recommendation.  The study's model assumed that 6
RRF roll-on/roll-off ships, not 36, would be needed at the seaports
of embarkation by day 4 and that 8 other RRF ships, not 27, would be
needed at the seaports by day 5.  By the 10th day, the model assumed
that only
36 ships would have arrived at the seaports.  DOD officials could not
explain the wide discrepancy between the model's data and the
mobility study's recommendation; however, DOD officials confirmed
that they believe this recommendation is still valid. 

DOD is conducting another review of its strategic mobility
requirements.  This review will be based on the requirement from the
October 1993 Bottom-Up Review to fight two regional conflicts nearly
simultaneously.  DOD anticipates issuance of a report by January
1995. 

In addition to DOD's ongoing mobility study, the Transportation
Command is conducting an RRF modernization study.  The objectives of
this study are to determine the optimum RRF size, composition, and
readiness to meet surge sealift requirements.  The study's final
recommendations will be submitted to DOD's Joint Staff/Transportation
Command working group for inclusion in an update to the Bottom-Up
Review report. 


--------------------
\3 The model applied was the Model for Inter-theater Deployment by
Air and Sea. 


   CONCLUSIONS
---------------------------------------------------------- Chapter 3:4

DOD's determination of the number of RRF ships it wants maintained at
various readiness levels is overstated, given (1) the current ability
of the Army to get from the forts to the ports and (2) the disparity
between the output of the analytical model and the mobility study's
recommendation.  The results of DOD's updated mobility study should
guide future RRF ship readiness levels. 

Given these problems, we believe DOD needs to provide more realistic
readiness requirements to MarAd.  We recognize one lesson of the
Persian Gulf War--RRF ships need to be more ready than they were at
that time--however, we also believe that the government should not
pay to keep an excess number of ships in a high-priority status. 


   RECOMMENDATION
---------------------------------------------------------- Chapter 3:5

We recommend that the Secretary of Defense direct the Commander in
Chief, Transportation Command, to annually review RRF ship readiness
requirements provided to MarAd and ensure that they are in line with
current military deployment capabilities. 


   DOD COMMENTS AND OUR EVALUATION
---------------------------------------------------------- Chapter 3:6

DOD generally agreed with our findings and concurred with our
recommendation to the Secretary of Defense.  DOD stated that RRF
readiness requirements are reviewed annually in cooperation with
MarAd as part of budget reviews.  DOD also noted that RRF readiness
levels are currently being examined as part of the Mobility
Requirements Study Bottom-Up Review Update. 

DOD's comments are reproduced in appendix I. 


FUTURE AVAILABILITY OF MERCHANT
MARINERS REMAINS A CONCERN
============================================================ Chapter 4

MarAd and DOD agree that a viable U.S.  merchant marine industry is
the best source for mariners to crew the RRF in an emergency. 
However, future declines in the pool of U.S.  mariners seem likely
and would affect MarAd's ability to adequately crew these ships.  The
Department of Transportation has proposed legislation designed to
help support the U.S.  merchant marine industry.  If, however, this
legislation is not implemented or does not adequately support a
mariner labor pool capable of providing enough mariners for the RRF,
other measures will need to be taken.  Both DOD and MarAd have
studied the idea of a merchant marine reserve program to either
supply or augment the required crew.  Maritime labor unions, who are
opposed to reserve programs, have proposed other alternatives, such
as chartering commercially useful RRF ships to U.S.  operators.  DOD
is also examining a proposal that has the potential of eventually
increasing the available U.S.  merchant marine labor pool. 


   RRF CREWING REQUIREMENTS
---------------------------------------------------------- Chapter 4:1

The RRF currently requires around 3,700 mariners for 108 ships.  To
meet DOD's Mobility Requirements Study, the RRF will require
approximately 4,800 mariners, as shown in table 4.1.  DOD is
currently reevaluating the size and composition of the RRF in an
update of the Mobility Requirements Study.  Once DOD determines the
number and type of ships in the RRF, crewing levels in accordance
with Coast Guard regulations and MarAd recommendations can be
reestablished. 



                          Table 4.1
           
           Estimates of RRF Crewing Requirements to
                  Meet DOD's Mobility Study
                       Recommendations

                             No.         MarAd
                              of   recommended    Total crew
Ship type                  ships     crew size   requirement
------------------------  ------  ------------  ------------
Auxiliary crane               10            39           390
Breakbulk                     48            34         1,632
Heavy lift                     7            37           259
Roll-on/Roll-off              36            33         1,188
Troop                          2            70           140
Tankers                       36            33         1,188
============================================================
Total                        139                       4,797
------------------------------------------------------------
Source:  DOD. 

According to DOD, if the RRF crewing requirements remain about 4,800,
and the U.S.  merchant marine labor pool continues to decline, steps
must be taken to ensure that an adequate pool of qualified mariners
is in place. 


   U.S.  MERCHANT MARINE POOL IS
   DECLINING
---------------------------------------------------------- Chapter 4:2

Crews for the RRF come from the labor pool that exists to operate
ships in the active U.S.  commercial fleet.  Each merchant mariner
job supports about two mariners in the labor pool to allow for
training, vacations, and job rotations.  The U.S.  commercial
ocean-going labor pool, from which crew members are drawn, currently
consists of about 21,000 mariners competing for about 9,300 shipboard
jobs.  Therefore, MarAd should not have a labor supply problem for
crewing RRF ships in the near term. 

Events in the maritime industry have had a direct impact on the
potential crewing of RRF ships.  During the 1960s, commercial ships
registered in the United States typically went to sea with crews of
more than
40 persons.  The average crew size has since declined in response to
labor-saving technology and automation.  For example, the
introduction of automated boiler controls during the mid-1960s and
diesel-powered ships during the 1970s reduced crew size.  As a
result, the number of shipboard jobs decreased.  For example, in
1970, the 843 ships in the U.S.-registered, ocean-going fleet
provided around 40,000 jobs.  By 1993, the number of ships had
declined to 350, and only about 9,300 jobs were available.  The
gradual decline in the pool of qualified and available mariners
needed for the RRF is shown in figure 4.1. 

   Figure 4.1:  Decline in U.S. 
   Merchant Mariners and Seafaring
   Employment for the Years 1960
   Through 1990

   (See figure in printed
   edition.)

Source:  GAO. 


   RESOLVING FUTURE CREWING
   CONCERNS
---------------------------------------------------------- Chapter 4:3

The Department of Transportation and DOD have conducted numerous
studies that address the continued decline in the merchant marine
industry.  General and specific proposals have been suggested to aid
the industry.  Thus far, Transportation, DOD, and others involved,
such as unions and ship operators, have been unable to reach
consensus on specific programs or crewing alternatives.  Therefore,
action has not occurred. 


      1994 MARITIME SECURITY
      PROGRAM
-------------------------------------------------------- Chapter 4:3.1

Transportation has proposed legislation--the Maritime Security
Program (H.R.  4003 and S.  1945)--to the 103rd Congress to help
revitalize the U.S.  Merchant Marine.  The $1 billion, 10-year
program proposes subsidizing up to 52 U.S.-registered liner ships. 
One of the program's goals is to provide additional sealift capacity
for national emergencies.  Therefore, this program would help
maintain an active pool of U.S.  mariners that can provide the
necessary crews to operate RRF ships during an emergency.  However,
the specific number of mariners the program may ultimately provide to
RRF vessels is not known. 


      EXPANSION OF NAVAL MERCHANT
      MARINE RESERVE
-------------------------------------------------------- Chapter 4:3.2

In 1986, the Navy examined crewing alternatives for the RRF and DOD
sealift ships.  One alternative was to expand the existing Merchant
Marine Reserve component of the U.S.  Naval Reserve.  At that time,
the Merchant Marine Reserve's purpose was to maintain an organization
of merchant marine officers who were trained to operate merchant
ships and a shoreside cadre assigned to naval activities supporting
strategic sealift.  The expanded program would include inactive,
qualified mariners.  The cost to implement this alternative was
estimated to be $10 million annually.  The Congress directed
Transportation to explore establishing a civilian reserve program. 


      CREATION OF A CIVILIAN
      RESERVE
-------------------------------------------------------- Chapter 4:3.3

In 1987, MarAd examined the concept of creating a civilian merchant
marine reserve program.\1 Qualified mariners who were not actively
sailing but were willing to commit themselves under contract for
service when needed would form the base for this program.  MarAd
envisioned that the program would be comprised of 6,480 mariners and
estimated its cost to be $46 million a year.  By 1991, MarAd had
completed another study that included the concept of a civilian
merchant marine reserve.  MarAd studied four options that could
increase mariner availability.  These options ranged from a program
with 500 members costing between approximately $3 million and $6
million annually to a program with over 2,000 mariners costing about
$19 million annually. 

Studies completed after the Persian Gulf War also called for the need
to consider a civilian reserve.  For example, a 1991 Department of
Transportation Inspector General report recommended that a civilian
reserve program based on MarAd's 1991 study be implemented.  In
addition, a 1991 DOD and Transportation RRF working group report
recommended that the agencies jointly pursue efforts to formulate a
civilian merchant marine reserve program. 


--------------------
\1 The Secretary of Transportation has the authority to establish and
maintain a voluntary organization for the training of U.S.  citizens
to serve on U.S.  merchant ships (46 App.  U.S.C.  1295e). 


      NEW NAVAL RESERVE UNITS
-------------------------------------------------------- Chapter 4:3.4

In 1986, the Navy examined an alternative establishing specific new
Naval Reserve units dedicated to manning all defense sealift ships. 
These units would be comprised of about 9,000 personnel who are
members of existing naval reserve programs and naval retirees.  The
cost of this alternative was estimated to be $46 million annually. 

In 1988 and 1989, the Navy told the Congress a number of its concerns
about the use of naval reservists for crewing RRF ships.  The Navy
stated that (1) naval reservists would not be available until DOD
mobilization, even though RRF ships would most likely be requested to
be activated before that time; (2) civilian mariners, not Navy
reservists, have the expertise in operating RRF ships; (3) no
training capability is currently available in the armed forces for
training personnel to operate civilian ships; and (4) crewing RRF
ships with naval reservists would change their noncombatant status
under international law. 


      MARITIME LABOR UNION VIEWS
-------------------------------------------------------- Chapter 4:3.5

Maritime labor unions have opposed government efforts to establish
any merchant marine reserve.  They believe that a government reserve
program would limit potential future jobs.  They also believe that
the potential implementation of any merchant marine reserve program
shows a lack of support for the U.S.  commercial merchant marine
industry and that government funds should be directed toward aiding
the maritime industry. 

Maritime labor unions have proposed that commercially useful ships in
the RRF be chartered to U.S.  operators.  This proposal would help
maintain a trained and experienced crew available at no cost to the
government.  The chartered rate would be set at the market rate and
would be reduced if there were no U.S.-flag competitors.  The terms
of the charter would include a guarantee that an operational ship
would be made available to DOD when needed.  However, because these
ships would be engaged in active shipping, some ships would have to
first unload cargo and then return to the United States when notified
and, therefore, might not be available to help meet DOD's surge
shipping requirements. 

Another maritime labor union proposal is to develop a designated
cadre of volunteers from within the ranks of the unions to be trained
and available for surge call-up.  This cadre would consist of three
times the number of crew members required for RRF ships to account
for mariners currently at sea and others not immediately available. 
DOD would set the standards for training, and mariners would receive
2 weeks paid training aboard RRF ships.  The cost of training,
mariner wages, subsistence, transportation, and ship activity would
be provided by DOD, according to this proposal.  The cost for this
proposal was not provided. 


      OTHER RECENT PROPOSALS
-------------------------------------------------------- Chapter 4:3.6

At the RRF crewing workshop we sponsored in April 1994, MarAd
presented an emergency crewing concept that would allow the unions
time to assemble regular crews from the commercial sector.  Under the
proposal, teams of 10 to 15 inactive mariners would assist ships'
managers to activate RRF ships.  The activation teams would then step
aside once union crews reported to the ships.  If some mariners were
not available from a union, then team members could be tasked to fill
those slots.  MarAd stated that 2,000 mariners would be needed for
this program.  MarAd estimated that the initial cost would be $2.2
million and that the program would eventually cost around $11 million
annually.  However, funding to develop this program was not approved
in MarAd's fiscal year 1995 budget. 

DOD is currently considering a concept to move Navy ships, such as
oilers, combat stores ships, and salvage ships, into the Military
Sealift Command.  Civilian mariners could crew these ships, which is
a practice the Military Sealift Command currently uses for crewing
its fast sealift ships.  This concept could result in an increase in
the size of active mariner pool and therefore the number of mariners
available to the RRF.  The number of mariners that could become part
of the active pool would depend upon the mariner-to-billet ratio used
by the Military Sealift Command.  This concept may also result in
substantial Navy cost savings because civilian crews aboard Sealift
Command auxiliary ships are generally smaller than Navy crews aboard
ships assigned to Navy battle forces. 


   CONCLUSIONS
---------------------------------------------------------- Chapter 4:4

In 1986, the Chairman of the House Committee on Merchant Marine and
Fisheries recognized the warning signs of a declining pool of
mariners when he said that "inadequate manning is the Achilles heel
of emergency sealift." The Persian Gulf War clearly demonstrated how
vulnerable the RRF could be if sufficient numbers of properly skilled
mariners are not available to sail when the ships are ready. 
However, since the war, little has been done to improve the
likelihood that RRF ships will be adequately crewed in the future. 
Neither DOD nor MarAd has proposed alternatives that seem to garner
universal consensus--including from the Congress, the Coast Guard,
maritime unions, and ship operators.  Our workshop was the first time
many of these players were together discussing this issue. 

Crewing the RRF will become a major problem as the pool of available
mariners declines and the requirements remain stable or grow. 


   RECOMMENDATION
---------------------------------------------------------- Chapter 4:5

We recommend that the Secretary of Transportation direct the Maritime
Administrator to annually assess whether an adequate number of
experienced U.S.  merchant mariners would be available to crew RRF
ships within DOD's specified time frames.  If these assessments
indicate that the number of qualified mariners may not be sufficient,
the Secretary should propose a specific merchant marine crewing
alternative to the Congress. 


   TRANSPORTATION COMMENTS AND OUR
   EVALUATION
---------------------------------------------------------- Chapter 4:6

Transportation partially concurred with our recommendation to
annually assess the number of qualified U.S.  mariners available to
crew RRF ships and, if necessary, report crewing options. 
Transportation said it maintains maritime workforce statistics on the
size and the composition of U.S.  merchant mariners and that the
Coast Guard is making progress toward improving the accuracy
regarding availability of mariners.  However, this information is not
reported to the Congress in conjunction with defense requirements. 
We believe that MarAd's assessment would be an appropriate first step
to define the effect that the declining U.S.  merchant marine pool
might have on national security. 

Transportation said that the recommendation should focus on the need
for reemployment rights legislation for U.S.  merchant mariners if
called upon to serve during a war or national emergency.  It pointed
out that reemployment rights were discussed in our workshop report. 
While Transportation acknowledged that consensus has not been
achieved on certain proposals--such as a civilian merchant marine
reserve or expansion of the naval merchant marine reserve--it
believes that identified crewing proposals have the potential to
achieve consensus.  Transportation stated that our workshop was
particularly beneficial toward providing a forum to meet this end. 
Transportation also noted that it is hopeful that its Maritime
Security Program, designed to strengthen the U.S.  merchant marine,
will pass the Congress this fall. 

We do believe that reemployment rights for U.S.  mariners equivalent
to the rights and benefits provided any member of a reserve component
of the Armed Forces would be fair and equitable.  However, the number
of mariners who would be influenced to serve on RRF ships by this
incentive is unknown and, therefore, the impact of such a program
cannot be determined.  In view of the continuing decline in the pool
of U.S.  mariners, we believe the central issue of how to crew RRF
ships in the future has not been adequately addressed.  Therefore, we
believe that an annual assessment of the crewing issue could clearly
identify specific actions needed to meet defense objectives related
to sealift requirements.  Further, the Congress has considered
legislation for reemployment rights three times, and has not approved
it twice, and at the time of issuance of this report, passage was
still uncertain as was Maritime Security Reform passage. 

The full text of Transportation's comments is reproduced in appendix
II. 




(See figure in printed edition.)Appendix I
COMMENTS FROM THE DEPARTMENT OF
DEFENSE
============================================================ Chapter 4



(See figure in printed edition.)



(See figure in printed edition.)

<apnote:32>Now on pp.  10 and 11. 



(See figure in printed edition.)

<apnote:24>Now on pp.  14-20. 



(See figure in printed edition.)



(See figure in printed edition.)

<apnote:6>Now on pp.  21-24. 

<apnote:9>See comment 1. 



(See figure in printed edition.)

<apnote:14>Now on pp.  24 and 25. 

<apnote:17>See comment 2. 



(See figure in printed edition.)

<apnote:15>Now on pp.  25 and 26. 

<apnote:18>See comment 3. 



(See figure in printed edition.)

<apnote:24>Now on pp.  27-32. 



(See figure in printed edition.)

<apnote:13>Now on pp.  30-32. 

<apnote:33>Now on pp.  5 and 26. 



(See figure in printed edition.)

<apnote:1>Now on pp.  5 and 32-33. 


The following are GAO's comments on the Department of Defense's (DOD)
letter dated October 3, 1994. 


   GAO COMMENTS
---------------------------------------------------------- Chapter 4:7

1.  Our report acknowledges that the Army's strategic mobility
program identified infrastructure improvement projects necessary to
meet the cargo flow time frames required in DOD's mobility study. 
However, our main point is that the Army lacks the capability today
to transport cargo from the fort to the port in sync with the RRF
ship readiness.  Further, our report notes given current funding
levels, most infrastructure improvement projects will not be
completed by the Mobility Requirements Study goal of fiscal year
1999.  The additional concerns DOD expressed concerning readiness
status are addressed in comment three. 

2.  Our report focuses on the Army's current ability to unload cargo
at underdeveloped seaports rather than on the Army's intention to
improve future capabilities. 

3.  After evaluating DOD's comments, we revised our caption for this
section to more accurately reflect the narrative presented.  DOD did
not provide any additional data to explain the large disparity
between our data analysis and the recommendation.  DOD also stated
that military judgment had been a factor in establishing the RRF
readiness requirements but the ongoing strategic mobility review
suggests that lower levels of readiness would provide a "more exact
match to port loading capability." We agree. 




(See figure in printed edition.)Appendix II
COMMENTS FROM THE DEPARTMENT OF
TRANSPORTATION
============================================================ Chapter 4



(See figure in printed edition.)



(See figure in printed edition.)

<apnote:40>See comment 1. 

<apnote:42>Now on p.  2. 



(See figure in printed edition.)

<apnote:3>See comment 2. 

<apnote:11>See comment 2. 

<apnote:18>See comment 2. 

<apnote:29>See comment 2. 

<apnote:37>Now on p.  10.
See comment 2. 



(See figure in printed edition.)

<apnote:1>See comment 2. 

<apnote:4>Now on p.  11.
See comment 2. 

<apnote:17>Now on p.  11.
See comment 2. 

<apnote:20>See comment 1. 

<apnote:24>See comment 2. 

<apnote:29>See comment 1. 

<apnote:32>Now on p.  14.
See comment 1. 



(See figure in printed edition.)

<apnote:1>Now on p.  14.
See comment 2. 

<apnote:4>Now on p.  14.
See comment 2. 

<apnote:13>Now on p.  14.
See comment 2. 

<apnote:22>Now on p.  15.
See comment 2. 

<apnote:26>See comment 1. 

<apnote:31>Now on p.  16.
See comment 2. 



(See figure in printed edition.)

<apnote:1>Now on p.  19.
See comment 2. 

<apnote:8>Now on p.  20.
See comment 1. 

<apnote:26>Now on p.  27.
See comment 3. 



(See figure in printed edition.)

<apnote:4>Now on p.  29.
See comment 3. 

<apnote:15>Now on p.  29.
See comment 3. 



(See figure in printed edition.)

<apnote:4>Now on p.  32.
See comment 3. 

<apnote:18>Now on p.32.
See comment 3. 



(See figure in printed edition.)


The following are GAO's comments on the Department of
Transportation's letter dated September 29, 1994. 


   GAO COMMENTS
---------------------------------------------------------- Chapter 4:8

1.  Our final report has been modified to reflect Transportation's
specific and technical suggestions. 

2.  After evaluating Transportation's comments and verifying our
sources, we believe the facts are accurately presented.  We did not
change our final report. 

3.  Our commentary concerning the reemployment rights issue are found
on pages 33 and 34.  . 


MAJOR CONTRIBUTORS TO THIS REPORT
========================================================= Appendix III


   NATIONAL SECURITY AND
   INTERNATIONAL AFFAIRS DIVISION,
   WASHINGTON, D.C. 
------------------------------------------------------- Appendix III:1

Norman Rabkin, Associate Director
Bob Eurich, Assistant Director
Brenda Farrell, Evaluator-in-Charge
Penny Berrier, Evaluator
Colin Chambers, Evaluator
Karen Blum, Communications Analyst


   NORFOLK REGIONAL OFFICE
------------------------------------------------------- Appendix III:2

Lawrence Dixon, Senior Evaluator
Carolyn McClary, Evaluator


RELATED GAO PRODUCTS
============================================================ Chapter 1

The National Defense Reserve Fleet--Can It Respond to Future
Contingencies?  (GAO/LCD-76-226, Oct.  6, 1976). 

A Time to Consider Alternative Sources of Quick-Response Sealift
Capability (GAO/LCD-78-244, Feb.  7, 1979). 

Navy Sealift:  Observations on the Navy's Ready Reserve Force
(GAO/NSIAD-86-168, Aug.  18, 1986). 

Army Deployment:  Better Transportation Planning Is Needed
(GAO/NSIAD-87-138, June 18, 1987). 

Industry Concerns Regarding the Policies and Procedures of the
Military Sealift Command (GAO/T-NSIAD-88-40, Aug.  8, 1988). 

Part of the National Defense Reserve Fleet Is No Longer Needed
(GAO/T-NSIAD-91-44, July 11, 1991). 

Strategic Sealift:  Part of the National Defense Reserve Fleet Is No
Longer Needed (GAO/NSIAD-92-3, Oct.  7, 1991). 

Desert Shield/Storm:  U.S.  Transportation Command's Support of
Operation (GAO/NSIAD-92-54, Jan.  9, 1992). 

Shipbuilding:  Navy's Plan to Acquire Additional Strategic Sealift
(GAO/NSIAD-92-224, July 30, 1992). 

Operation Desert Shield:  Problems in Deploying by Rail Need
Attention (GAO/NSIAD-93-30, Nov.  13, 1992). 

DOD's Mobility Requirements:  Alternative Assumptions Could Affect
Recommended Acquisition Plan (GAO/NSIAD-93-103, Apr.  22, 1993). 

Management Reform:  GAO's Comments on the National Performance
Review's Recommendations (GAO/OGC-94-1, Dec.  3, 1993). 

Letter to the Maritime Administrator (GAO/NSIAD-94-96R, Jan.  7,
1994). 

Strategic Mobility:  Serious Problems Remain in U.S.  Deployment
Capabilities (GAO/T-NSIAD-94-165, Apr.  26, 1994). 

Strategic Sealift:  Summary of Workshop on Crewing the Ready Reserve
Force (GAO/NSIAD-94-177, June 6, 1994).