US Cancels Delayed Coast Guard Cutter Project, Saves $260M For Taxpayers

USCGC Bertholf — Image Credits: Wikipedia

The Department of Homeland Security has cancelled a delayed shipbuilding contract with Huntington Ingalls Industries (HII), the largest military shipbuilding company in the US. The cancellation of the contract saved over $260 million for American taxpayers, the department announced.

The contract involved the construction of the 11th Legend-class National Security Cutter (NSC) for the U.S. Coast Guard. Production on the vessel began in May 2021 and it was expected to be delivered by 2024. However, officials said the ship is still nowhere near completion.

Homeland Security Secretary Kristi Noem said the decision helps control federal spending and supports the Coast Guard’s upgrade plans. According to Noem, the builder was supposed to deliver the cutter more than a year ago and the project had become both overdue and over budget.

She said the decision shows the Trump administration’s focus on making smarter financial decisions, as part of the Force Design 2028 plan to modernise and strengthen the Coast Guard.

As part of the termination agreement, the Coast Guard will still receive $135 million worth of ship parts from Huntington Ingalls. These parts will be used to retrofit, upgrade, and maintain the Coast Guard’s existing fleet of 10 Legend-class cutters. Officials said this ensures the deal continues to benefit the service despite the cancellation.

The most recent cutter in the fleet, the USCGC Calhoun (WMSL-759), officially entered service in April 2024. With the cancellation of NSC 11, the remaining funds, more than $260 million, will be returned to the U.S. Treasury and can now be redirected to other priorities.

Observers believe this move could mean that the Coast Guard is prioritising other major shipbuilding programs, like the Offshore Patrol Cutter (OPC) and Polar Security Cutter (PSC) projects, both considered essential for the future of the maritime service.

Officials also acknowledged that HII cooperated during the talks. Secretary Noem publicly thanked the shipbuilder for helping find a solution that benefits both taxpayers and the Coast Guard.

Reference: DHS

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