July 31 2019 — Panama City News Herald
PANAMA CITY — A bill needed to continue a long-awaited multi-billion-dollar Coast Guard shipbuilding project in Panama City sailed through a U.S. Senate committee on Wednesday.
The bill, which received bipartisan support in the Senate Committee on Commerce, Science and Transportation, would let the Coast Guard renegotiate its $10.5 billion contract with Eastern Shipbuilding Group to account for higher labor costs and shortages caused by Hurricane Michael. The bill should help the project get back on track after the hurricane to create hundreds of new jobs that are needed more than ever as the area still recovers from the Category 5 storm, some officials say.
According to a Wednesday news release, the committee approved U.S. Sen. Marco Rubio’s Restore Coast Guard Capabilities Act as part of the Coast Guard Reauthorization Act of 2019. Rubio’s bill would give the Coast Guard the authority to renegotiate the contract with Eastern Shipbuilding to construct the first series of up to 25 offshore patrol cutters. Without a way to renegotiate the contract, the project could be delayed by years, Rubio’s office warned.
“Continuing authorizations for the Coast Guard to protect Florida’s waterways and our nation’s homeland security is imperative,” Rubio said in the press release. “I applaud the Senate Commerce Committee on approving this larger authorization, which includes several of my joint priorities that are critical to the Coast Guard’s mission readiness.”
The bill quickly moved through in part with the help of U.S. Sen. Rick Scott, a member of the committee and co-sponsor of the bill, the release states. With the committee process done, the bill’s next step is introduction on the Senate floor. When the bill will be introduced is not yet known, a Rubio office spokesman said on Wednesday.
“We are thankful to Sen. Rubio and Sen. Scott for their tireless work on the Restore Coast Guard Capabilities Act, which has moved through committee in the U.S. Senate,” Mark McQueen, city manager of Panama City, wrote in a Wednesday email to The News Herald. “This will allow much needed economic stimulus and job creation … to the City of Panama City and surrounding area.”
The Coast Guard has maintained that the contract — the largest in its history — is its highest investment priority. Aside from creating vessels the Coast Guard needs for maritime security missions, the project is expected to create 900 direct jobs and 5,000 indirect jobs for the region.
The Coast Guard requested the authority to renegotiate, while not exceeding the original affordability requirement set forth by the government in the existing contract, because of skyrocketing labor costs caused by the hurricane.
The historic storm, which hit the Panhandle on Oct. 10, significantly damaged Tyndall Air Force Base. The press release states that the labor needed to rebuild the base is competing directly with the labor required to fulfill Eastern Shipbuilding’s contract.
“As a result of my partnership with Sen. Scott, the bill … will ensure the Coast Guard has the tools necessary to safeguard the offshore patrol cutter even after the devastation caused by Hurricane Michael,” Rubio said.