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Sequestration Could Jeopardize Two Contracts For EB, Second Submarine

'This is a very serious impasse that could really put a cloud over EB’s projected hiring,' Congressman Joe Courtney says. But he adds that Congress still has time to fix the impasse.

 

U.S. Rep. Joe Courtney said the federal cuts slated to go into effect under sequestration would affect shipyards across the country, including Electric Boat in Groton.

Sequestration - or $1.2 trillion in cuts - are slated to go into effect March 1. Half the cuts would come from the defense industry.

Electric Boat has two contracts with the Navy – one a $94 million contract to repair the USS Miami, the Groton-built nuclear submarine that caught fire at the Portsmouth Naval Shipyard May 23; and the second a $34.9 million contract to work on the USS Providence, which was scheduled to come into Groton later this year.

Both could be suspended if sequestration occurs.

“This is a very serious impasse that could really put a cloud over EB’s projected hiring,” Courney said, referring to the optimistic picture painted by the company during a legislative breakfast in January.

“But Congress still has time to fix the impasse and allow the great work that people do there to go forward. The leadership of the Navy, over and over again, repeated their desire to have this work move forward in Groton. But their hands are tired until Congress and the White House come to an agreement,” he said.

According to the Electric Boat website, repairs to the USS Miami would involve 300 EB employees.

Electric Boat has declined comment on the potential impacts.

“The Department of Defense has not informed us how it intends to implement sequestration, if it occurs. Consequently, any response on our part would be speculative,” Spokesman Dan Barrett said in an e-mail.

Courtney said that in addition to the repair contracts that could be placed on hold, Congress last year got a defense bill through that provided funding for a second submarine to be built in 2014. But he said Congress does not have a budget bill passed to go with that defense bill, The current spending bill ends March 27.

Admiral Jonathan Greenert, who testified last week before the U.S. Senate and the House of Representatives, said that if the Navy did not get a spending bill to match the defense bill, the second submarine would be at risk.

Electric Boat is meanwhile proceeding with the Ohio replacement program, which deals with a different class of submarines. As of Monday, the company was still hiring engineers and other positions.

“There’s still time to stop the madness here, and that’s true,” Courtney said. “It’s not like the law takes away the money irrevocably in one day.” He said sequestration was designed to be completely unacceptable but cutting indiscriminately across all areas, thereby forcing a compromise.

“And hopefully,” he said, “as in the past with sequestration, cooler heads will prevail.”

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