Tuesday, June 1, 1999

Private shipyards
hope jobs bill
brings relief

It's not certain, but if the
bill passes, Pearl Harbor
would get $23 million

By Gregg K. Kakesako


For the past year, Hawaii's privately owned shipyards and ship repair facilities have waged a battle to get back jobs they lost when the Navy trimmed maintenance contracts.

More than 300 private shipyard workers were laid off.

This is because more than 30 percent of repair work at the Pearl Harbor Naval Shipyard in the past was handled by private contractors.

They see relief now in legislation pending before the U.S. Senate that appropriates $23 million for Pearl Harbor's ship depot maintenance program.

"It sure sounds like very good news," said John Ball, president of the 34-member Ship Repair Association of Hawaii.

Sen. Daniel Inouye's office in Washington, D.C., said the $23 million is needed by the Navy to keep the work at Pearl Harbor on schedule.

It could help free up more money for private sector work, Inouye's office said, although there were no estimates on how much that could be.

Hawaii's private shipyard builders for the past year have been trying to move off their reliance on military contracts and survive by developing "a strong commercial base."

However, the word from Navy officials here within recent months was "there was a tremendous backlog of work" that needed to be done on Navy warships at Pearl Harbor, said Ball, who is the chief operating officer for Honolulu Shipyard Inc.

Ball said Navy estimates were "upwards of $40 million" of repair work.

In anticipation, Honolulu Shipyard formed a partnership with Mississippi-based Ingalls Shipbuilding to supplement its work force if the prediction ever comes true.

"We know the work is out there," said Ball. "We know that it will be done at Pearl Harbor. The question now is whether the Navy has the dollars to contract the work.

"The Navy has been extremely supportive of our needs. They understand the problem. They know they need a viable private sector here to take care of surge work."

Lt. Cmdr. Conrad Chun, spokesman for the Pacific Fleet, declined to comment on Inouye's announcement, noting that "it would be inappropriate to discuss the issue until the budget cycle is completed."

Inouye helped shepherd the $23 million appropriation through the Senate Appropriations Committee and to the floor for a full vote. It is part of the Department of Defense Appropriations bill that will take effect Oct. 1

"I am committed to ensuring a balance between the public and private sector work requirements," Inouye said in a written statement.

"To do so, we must address the funding shortfalls, as well as a reduced overall fleet. We must look for a new partnerships and ways of doing business."

However, the appropriation still has a long way to go, including scrutiny by House and Senate conference committees, final votes by both bodies and approval by the president.

Last year, the Navy cut the work it contracted to private shipyards to $10 million. That was a drop from previous years when funding ranged from a high of $37 million in 1995 to $22 million in 1997. Only $13 million is projected for this year.

In the past, Navy work amounted to 60 to 70 percent of the work at the state's two largest private yards -- Honolulu Shipyard and Marisco Ltd.

At Honolulu Shipyard, Ball said his labor force fluctuated from 100 workers to an all-time low at one point of 30 workers.

The Navy maintains that budget restraints caused the cutbacks.

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