Assessing Policy Changes on the Cost of Husbanding Services for Navy Ships

Abstract

In the wake of a major corruption conspiracy, the U.S. Navy reformed husbanding service procedures to increase competition, auditability, and accountability with the goal of reducing expenditures. The first policy change, Off-Ship Bill Pay (OSBP), formalized a process for procuring, rendering, and paying for husbanding services to increase oversight. The second policy change increased the use of multiple award contracts (MACs), in which multiple vendors are awarded a contract over a region, increasing competition for individual port visits. The purpose of this article is to analyze the effects of these policy changes on the cost of husbanding services. Multiple regression was used to account for port visit characteristics that affect cost such as ship type and the number of days in port. MACs demonstrated a reduction effect on the cost of port visits. Further, OSBP appears to have a negligible effect on port visit cost after the initial learning curve for both Navy personnel and vendors.