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Strategies for Obtaining Ship Services: Alternatives for NOAA (1988)

Chapter: 5. Case Histories, Assessment of Alternatives, and Guidelines for Chartering

« Previous: 4. Comparison of NOAA-Owned and -Operated Vessels Versus Charter Vessel Alternatives: A Methodology
Suggested Citation:"5. Case Histories, Assessment of Alternatives, and Guidelines for Chartering." National Research Council. 1988. Strategies for Obtaining Ship Services: Alternatives for NOAA. Washington, DC: The National Academies Press. doi: 10.17226/1920.
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Page 49
Suggested Citation:"5. Case Histories, Assessment of Alternatives, and Guidelines for Chartering." National Research Council. 1988. Strategies for Obtaining Ship Services: Alternatives for NOAA. Washington, DC: The National Academies Press. doi: 10.17226/1920.
×
Page 50
Suggested Citation:"5. Case Histories, Assessment of Alternatives, and Guidelines for Chartering." National Research Council. 1988. Strategies for Obtaining Ship Services: Alternatives for NOAA. Washington, DC: The National Academies Press. doi: 10.17226/1920.
×
Page 51
Suggested Citation:"5. Case Histories, Assessment of Alternatives, and Guidelines for Chartering." National Research Council. 1988. Strategies for Obtaining Ship Services: Alternatives for NOAA. Washington, DC: The National Academies Press. doi: 10.17226/1920.
×
Page 52
Suggested Citation:"5. Case Histories, Assessment of Alternatives, and Guidelines for Chartering." National Research Council. 1988. Strategies for Obtaining Ship Services: Alternatives for NOAA. Washington, DC: The National Academies Press. doi: 10.17226/1920.
×
Page 53
Suggested Citation:"5. Case Histories, Assessment of Alternatives, and Guidelines for Chartering." National Research Council. 1988. Strategies for Obtaining Ship Services: Alternatives for NOAA. Washington, DC: The National Academies Press. doi: 10.17226/1920.
×
Page 54

Below is the uncorrected machine-read text of this chapter, intended to provide our own search engines and external engines with highly rich, chapter-representative searchable text of each book. Because it is UNCORRECTED material, please consider the following text as a useful but insufficient proxy for the authoritative book pages.

5 CASE HISTORIES a ASSESSMENT OF ALTERNATIVES, AND GUIDELINES FOR CHARTERING Chapter 5 completes the strategy to consider vessel charter alternatives for NOAA's ship service needs. It attempts to accomplish three objectives: 1) present a summary of the chartering experiences of other federal agencies and organizations; 2) draws on the information from the previous chapters and case histories, to make a final assessment of the chartering alternatives most appropriate for each of NOAA's mission areas; and finally, 3) presents a list of guide- lines to be considered when chartering for ship services. CHARTERING EXPERIENCE BASED ON CASE HISTORIES In examining the benefits and drawbacks of obtaining vessel support by chartering from the private sector, the committee could not overlook the pool of information to be derived from the past~chartering experi- ences of both NOAA and the other federal agencies. The committee designed a brief questionnaire requesting information for each of the categories defined in Chapter 2: bare boat, vessel with crew and required sea-going equipment (time charter), and contracting for an end product (turnkey) at either a day rate or end product fixed price (see Appendix D). Information was sought on specific contracts pertaining to contract -schedules, costs, and quality of service. The committee solicited information from all the vessel operating agencies with past experience in vessel chartering by means of this questionnaire. Respondents to the questionnaire included vessel users, owners, and operators in the federal government and the private sector. The infor- mation (summarized in Appendix D) varied in quality and specificity. However, a number of universal lessons could be learned from the good and bad experiences of the federal government using the vessel support capabilities of the private sector. It appears clear from all agency experience that for basic oceano- graphic research (and, in most instances, applied research), a contract in which a specified end product is sought (turnkey) is too inflexible an arrangement. The end product of basic research is not contractually defineable. Several agencies have, however, had excellent results in chartering a vessel with crew for scientific research. 49

50 TABLE 5-1 Relative Assessment of Potential for NOAA Charter or Contract Applications Mission Area Bare boat Charter Time Charter Turnkey Contract Bathymetry Short term none poor poor Long term good good good Fisheries Short term none fair fair Long term good good fair Oceanographic and atmospheric research Short term none fair fair Long term good good none Many contracts that the government technical personnel consider marginal or unsatisfactory can be attributed to central procurement and contracting. Also, most examples of effective government contracts in which an end product is sought (turnkey) have had technically qualified government personnel (uniformed or civilian) aboard the contractor's vessels overseeing the vessel operations in real time. Based on past experiences, it appears that chartering can be applied to the advantage of the vessel user. However, several lessons can be drawn from these experiences in order to ensure greater success in future vessel chartering. Chartering using a turnkey arrangement is not appropriate for basic and applied research functions because end products are not defineable. Contracting through central procurement is not advised for technically complex contracts. Lastly, quality assurance of technical operations can be maintained by placing govern- ment personnel aboard contract vessels in an oversight capacity. ASSESSMENT OF NOAA CHARTER ALTERNATIVES Based on information gathered for this study, the committee evalu- ated each of the potential charter arrangements for short-term or long-term contracts with respect to each of the NOAA mission areas. Table 5-1 summarizes the relative assessments which are discussed in greater detail below. The chartering alternatives were rated on a relative scale as follows: o None--chartering is not a viable solution for NOAA to obtain ship services and in-house capability should be used.

51 o Poor--chartering is possible but not an optimal solution. o Fair--a good solution for only certain types of projects within the mission area and in certain geographic regions. o Good--chartering would be a good alternative for NO M to pursue in order to obtain ship services. The committee made its evaluations after an examination of each chartering alternative relative to the factors discussed in Chapter 4 and to the experience of other federal agencies in leasing vessel support. Each assessment is discussed below. - Bareboat Charter The committee agreed that a short-term charter for a bare boat for projects in any mission area would be a highly unlikely possibility. No organization in the private sector would be willing to outfit and charter a ship for a short term because of the expenditure of time and resources required for this activity. A long-term arrangement, on the other hand, would be a good means for NOAA to acquire a vessel through a build-to-lease arrangement. NOAA could also use this option as a means of replacing the existing NOAA Fleet. Time Charter Bathymetry A short-term arrangement for a time charter in bathymetric survey- ing might be possible but not likely because of the lack of adequate vessels and equipment in the private sector. Therefore, it is con- sidered a poor alternative. A long-term charter, however, would be a good possibility because it would allow time for the vessel owner to construct and equip a vessel for conducting bathymetric surveys and amortize the value of the vessel over a long period of time. A long-term commitment would also allow time for proper training of personnel. Fisheries Short-term time charters for fisheries work have been used success- fully by the Northwest and Alaska Fisheries Center for project-oriented tasks. The committee recognizes that the appropriateness of this alternative for fisheries is largely dependent on regional and seasonal availability of vessels as well as the type of fisheries project. The Pacific Northwest has a fishing fleet of relatively new vessels vastly different from those of other areas, particularly that of the Northeast. Therefore, in this region chartering has afforded NOAA an opportunity to have access to state-of-the-art technologies for some of

52 its specific short-term requirements. This opportunity would not be available in the Northeast. Fisheries vessel charters would be appro- priate for short-term species-specific stock assessments but inappro- priate for those fisheries surveys supporting long-term time series data sets. As with bathymetry, many benefits would be realized by NO M if long-term charters were made available. NOAA would be able to charter properly outfitted vessels that could be properly calibrated to its own vessels. However, intercalibration of the fishing characteris- tics of vessels is expensive and time consuming. Because of this, the shorter the charter period, the less efficient and viable chartering becomes for these purposes. Once calibrated, those vessels should be used for as long as possible. On the other hand, the opportunity of gaining access to state-of-the-art technologies with long-term charters would potentially be diminished since the opportunity to charter dif- ferent, possibly newer vessels on a more frequent basis would decrease. Oceanographic and Atmospheric Research The vessel needs of many of NOAA's oceanographic research and environmental assessment programs are less specialized than those of the other two mission areas. Equipment needs are less elaborate and sophisticated, and space requirements are moderate. Short-term time chartering is rated by the committee to be a fair proposition, since existing vessels may or may not be available. Long-term time charters are considered to be a good alternative. For more complex research projects requiring larger, more sophisticated vessels, long-term arrangements may be the only option. As with bathyme try and fisheries, a longer commitment would make it more likely for a vessel owner to equip and modify a vessel to meet the specific needs of NOAA. Turnkey Contract Bathymetry Turnkey contracts for bathymetric surveys hold the same advantages for the long term as the other two charter arrangements. Short-term charters, although possible, are much less desirable than long-term charters due to the limited supply of existing commercial assets. Therefore, short-term turnkey contracts for bathymetric surveys are rated to be poor alternatives, whereas long-term contracts are considered to be good alternatives. Fisheries Turnkey contracts for selected fisheries projects area are considered a poor alternative for the short term due to the availablity Of special assets. Short-term contracts would have to be limited to

53 certain functions and missions such as certain stock assessment activities. In the long term, application in fisheries research projects is also limited since it is virtually impossible to specify an end product with such activities. Oceanographic and Atmospheric Research Opportunities for short-term or long-term turnkey contracts for research activities are poor, if not nonexistent, since research is not conducive to an identifiable end product. Environmental assessment projects would be possibly more amenable to this type of contract arrangement. GUIDELINES FOR CHARTERING The committee presents a general list of of guidelines that should be followed in order to assure greater success in obtaining chartered vessel services, in other words, obtaining good product, price, and service. These guidelines are drawn from the experiences of the private sector, other agencies using chartered vessel services and NOAA's own experiences. They are expanded on in a more explicit procedure for obtaining chartered ship services shown in Appendix G. NOAA should consider the following guidelines: · Identify a mission area and type of charter based on criteria discussed in Chapters 4 and 5 of this report. · Prepare a budget plan to accomodate the charter or contract which includes cost of the charter as well as costs internal to NOAA (for example, vessel deactivation, administrative arrangements). O Prepare an REP which includes tight contractual terms for ship's design, crew, and equipment; list the specialized equipment and instrumentation needs and the technical specifications for them; establish the Standards and Tolerances, including data format for the particular survey under consideration (what is wanted and what is acceptable), with penalty provisions in the contract if they are not met. · Ensure that scientific personnel are involved in the REP preparation and contracting procedures, particularly those that define technical specifications and operational procedures. · Solicit competitive bids from reputable contractors. · Establish good communications between contractor and user. · Station the user's quality control specialist aboard the vessel to ensure that technical and operating requirements are fulfilled. NOAA can and should follow these guidelines, but may have to offer long-term contracts to make it economically attractive to both contractors and NOAA. Some NOAA bathymetric, fisheries, and oceanographic projects may be attractive candidates for charter vessel

54 support depending on the specific technical and operational needs and the alternative charter arrangements available. All of these details must be carefully considered as has been discussed in this report.

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