WASHINGTON – A top defense official indicated Wednesday that workers at the Navy’s four public shipyards – including the Portsmouth Naval Shipyard in Kittery – could be given a special exemption from budget-related furloughs.

The Navy has already said that it could likely absorb its share of $43 million in Defense Department “sequestration” spending cuts without furloughing any civilian employees this fiscal year. But Pentagon officials are still considering requiring more than 700,000 civilian employees to take as many as 14 days of unpaid leave.

Assistant Secretary of the Navy Sean Stackley told senators Wednesday that even if furloughs are required, the Pentagon could exclude civilian employees whose jobs directly affect the Navy’s ability to carry out its mission.

“And shipyards are in that mix,” Stackley told Sen. Kelly Ayotte, R-N.H., during a Senate Armed Services subcommittee hearing. Furloughing workers at shipyards, he said, would disrupt the maintenance and modernization schedule for ships and likely wouldn’t save money in the long term.

“I think everyone understands that shipyards are a special case in terms of direct impact on readiness,” Stackley said. “The math states there is going to be more than a one-for-one impact if you furlough.”

The Department of Defense had to absorb about one-half of the $85 billion in across-the-board spending cuts that began March 1 after Congress and the White House failed to agree on another way to reduce the federal deficit. Those budget cuts will continue for the next nine years — totaling about $100 billion a year — unless Congress adopts an alternative.


While not official, the mere suggestion of a waiver or exemption will likely be welcome to the roughly 4,700 civilian workers at the Portsmouth Naval Shipyard. The shipyard, on the Maine-New Hampshire border, repairs, maintains and upgrades nuclear-powered submarines.

Paul O’Connor, president of the Portsmouth Metal Trades Council, the group that represents several of the labor unions at the facility, said it’s clear that furloughing shipyard workers will not save the federal government any money.

And he said hundreds of thousands of other civilian employees would still be furloughed because of Congress’ failure to act.

“The work is going to have to be done on the nuclear submarines and aircraft carriers, whether it is done on schedule or behind schedule,” O’Connor said. “It is going to cost American taxpayers more money to furlough employees than to keep them on the job.”

Senators from Maine and New Hampshire said they were pleased to hear about the possible waiver, although they plan to keep pushing Pentagon officials to give the Navy and other agencies the flexibility to make budget cuts without furloughs.

“That was good to hear,” Ayotte said in an interview. “That makes sense to me, in light of the problems with the maintenance falling behind, that shipyard workers would fall clearly within the waiver authority.”


The Navy’s budget request for the fiscal year that starts Oct. 1 includes money for eight new ships, including two Virginia-class submarines and one new destroyer. The Navy’s five-year plan calls for procurement of 47 ships, including a total of 10 DDG-51 destroyers.

Maine’s Bath Iron Works and Ingalls Shipbuilding in Pascagoula, Miss., are the two primary competitors to build the Arleigh Burke-class DDG-51 destroyers, each of which costs more than $1 billion.

BIW, which employs about 5,000 workers, has built 36 of the 66 destroyers that the Navy has bought since 1985, according to the Congressional Research Service.

But Stackley said the Navy is about $300 million short of being able to procure the 10th destroyer that Congress directed the Navy to build.

Including the ship in the multi-year contracts that are being negotiated with the two shipyards will result in the “most affordable destroyer that we will be looking at for the foreseeable future,” Stackley predicted.

“We have contract proposals in hand for the 10th ship. We have all but about $300 million appropriated that we need to award the 10th ship,” Stackley told Sen. Angus King of Maine during one exchange Wednesday. “So we’re in the red zone and we have got to punch this thing across the goal line.”


Stackley said afterward that the Navy has time to secure the money to exercise its option to add a 10th destroyer to the multi-year contracts.

King pledged to keep working to find the additional $300 million because it would lower costs by allowing the Navy to avoid restarting the bidding process. 

Kevin Miller can be contacted at 317-6256 or at: [email protected]

On Twitter: @KevinMillerDC

Correction: This article was corrected May 14 to reflect that the Portsmouth Metal Trades Council is an umbrella organization that represents some but not all of the labor unions at the Portsmouth Naval Shipyard in Kittery.



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