WASHINGTON — The U.S. Navy has canceled plans to repair a fire-damaged nuclear submarine at the Portsmouth Naval Shipyard in Kittery because of higher-than-anticipated costs and federal budget cuts, officials said Tuesday.

The Navy estimated that it would cost an additional $390 million in the fiscal year that starts Oct. 1 to repair the USS Miami, which was severely damaged by an arsonist at the shipyard in May 2012. As a result, the submarine will be removed from service and the money will be used elsewhere.

The Navy said it has spent $8 million so far for repairs to the submarine – from a $94 million contract it awarded to a contractor in September.

It was unclear Tuesday night how the decision will affect the workload at the shipyard, which employs about 4,700 civilians. But the consensus among union leaders was that it will not cause the loss of any jobs.

Shipyard spokeswoman Danna Eddy said she could not comment on the Navy’s decision or how it would affect the work force.

Most of the repair work on the USS Miami was being done by employees of Electric Boat, a Connecticut-based subsidiary of General Dynamics.


In a joint statement Tuesday night, members of the Maine and New Hampshire congressional delegations said Navy officials indicated that the inactivation process and other planned maintenance projects will continue to provide a “consistent workload” to the Kittery shipyard.

“The decision to inactivate Miami is a difficult one, taken after hard analysis and not made lightly,” Rear Adm. Rick Breckenridge, the Navy’s director of Undersea Warfare, said in a prepared statement Tuesday evening.

“We will lose the five deployments that Miami would have provided over the remaining 10 years of her planned service life,” he said, “but in exchange for avoiding the cost of repairs, we will open up funds to support other vital maintenance efforts, improving the wholeness and readiness of the fleet.”

Breckenridge is scheduled to discuss the Navy’s decision in more detail with the media Wednesday morning.

A Los Angeles-class attack submarine, the USS Miami was in dry dock at the shipyard for an overhaul when a worker set a fire on board because he reportedly wanted to leave work early.

The blaze burned for 10 hours and caused hundreds of millions of dollars in damage. More than 100 firefighters helped fight the fire. Five were injured.


The man who set the fire, Casey James Fury, was sentenced in March to 17 years in prison and ordered to pay $400 million in restitution.

Navy officials consistently said they hoped to put the vessel back into service. The repairs were expected to cost about $450 million and continue into the spring of 2015.

Earlier this year, members of the two states’ congressional delegations worked to secure an additional $150 million for the repairs to offset across-the-board federal budget cuts known as sequestration.

But the Navy said inspections revealed that “a significant number of components” would have to be replaced in the submarine’s torpedo room and auxiliary machinery room. Ultimately, the Navy decided that it was more cost-effective to decommission the submarine than to cancel “dozens” of projects on other ships and subs, Breckenridge said.

“The Navy and the nation simply cannot afford to weaken other fleet readiness in the way that would be required to afford repairs to Miami,” he said.

Though most of the repair work was assigned to Electric Boat, members of the shipyard’s Metal Trades Council will be devastated by the Navy’s decision, said Paul O’Connor, the union’s president.


He said Metal Trades Council workers were overhauling the submarine when the fire broke out. “We wanted to work on that boat and get it back to the fleet,” O’Connor said Tuesday night. “We didn’t want this to be the final chapter in the history of the Miami.”

O’Connor, whose union represents about 2,500 workers, laid blame for the Navy’s decision on sequestration, which he said has forced union workers to miss one day’s pay each week. He said the furloughs have pushed families who live on tight budgets to the edge.

“We are only a few months into sequestration and look at the damage it has already caused,” he said. “We are losing a significant military asset because of sequestration.”

O’Connor said he worries about the future, after the Miami is retired. His union would have been responsible for future overhauls of the submarine.

“They are our boats when they come into this shipyard,” he said. “We are feeling a great sense of loss.”

Arvard Worster, president of the American Federation of Government Employees, Local 2024, which represents about 600 civilian employees at the shipyard, said the union’s workers probably won’t see a smaller workload because of the Navy’s decision, but removing the USS Miami from the fleet still hurts.


“We have a lot of pride in the work that we do and we have a good track record,” said Worster, whose union includes administrative assistants, security police, computer operators and secretaries. “(The arson) that happened caught us off guard.”

The four senators from Maine and New Hampshire said in their statement that they recognized the repair costs were rising, but they were disappointed, especially considering the role that the budget cuts apparently played in the decision.

“Inactivating the Miami will mean a loss to our nuclear submarine fleet,” said Maine Sens. Susan Collins and Angus King and New Hampshire Sens. Jeanne Shaheen and Kelly Ayotte. “We will continue to work together to find a responsible budget solution that replaces sequestration.”

U.S. Rep. Chellie Pingree of Maine, a Democrat whose district includes Kittery, called it “outrageous” that the sub won’t be put back into service because of sequestration.

Pingree voted against the law that set up the budget cuts, which were designed to be so austere that Congress and the White House would find an alternative way to reduce the federal deficit. Absent congressional action, the cuts took effect in March.

“I am deeply disappointed by the decision not to repair the Miami,” Pingree said in a prepared statement. “It is shameful that this ill-conceived law has contributed to the loss of work at the Portsmouth Naval Shipyard.”


Pingree is married to S. Donald Sussman, majority share owner of MaineToday Media, which publishes the Portland Press Herald.

The initial restoration effort involved damage assessment, planning and material procurement, and fabrication and installation. About 300 Electric Boat workers were going to be involved in the project.
“We were just starting to ramp up to do more extensive repairs,” Electric Boat spokesman Bob Hamilton said Tuesday night.

Commissioned in June 1990, the Miami is 362 feet long and 33 feet wide at its breadth, and carried a crew of 133 enlisted personnel and officers. It was built in Groton, Conn.

Kevin Miller can be contacted at 317-6256 or at kmiller@mainetoday.com

Dennis Hoey can be contacted at 791-6365 or atdhoey@pressherald.com

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