Acquisition: Contract Award and Administration for the Improved Navy Lighterage System

Abstract : This report is the second and last report of audits performed in response to a request from Senator Pete V. Domenici and allegations made to the Defense Hotline from one complainant. The first report addressed allegations relating to the Army Modular Causeway System. This report addresses 12 allegations relating to the Improved Navy Lighterage System. The allegations stated that the Navy based a key Improved Navy Lighterage System component, the "side connector," on a faulty, unreliable, and unsafe design. In addition, the allegations stated that the procuring activity, the Naval Facilities Engineering Command, cultivated an uncompetitive contracting process, and the Defense Contract Management Agency failed to manage the Improved Navy Lighterage System contracts. From August through October 2003, the Naval Facilities Engineering Command awarded two contracts related to the Improved Navy Lighterage System, one for the procurement of the system modules and one for the procurement of the system side connectors for a total of 5413 million. First article testing of the Improved Navy Lighterage System side connector was performed from June through September 2004. Operational evaluation testing for the Improved Navy Lighterage System is scheduled to begin February 2006. We did not substantiate seven allegations regarding the Improved Navy Lighterage System side connector design, reliability, and safety. We also did not substantiate five allegations regarding the Naval Facilities Engineering Command contract award or the Defense Contract Management Agency management of the Improved Navy Lighterage System contracts.