THE VIRGINIAN-PILOT
Copyright (c) 1996, Landmark Communications, Inc.
DATE: Saturday, October 5, 1996 TAG: 9610050367
SECTION: FRONT PAGE: A2 EDITION: FINAL
SOURCE: STAFF AND WIRE REPORT
DATELINE: WASHINGTON LENGTH: 60 lines
The Navy could save nearly $50 million over the next four years by ending $10,000 annual cash bonuses for specially trained officers on nuclear-powered submarines and ships, a congressional report said Friday.
The bonuses - enjoyed by dozens of Norfolk-based officers - began in the late 1960s to entice those with nuclear training to stay in the service, rather than pursue lucrative offers in a growing civilian nuclear power industry.
Now, as the industry declines and the number of nuclear engineering jobs is projected to drop, the additional pay may no longer be necessary, the Congressional Budget Office said.
``The overall lure of the civilian labor market has lost some of its strength,'' said the report, which was requested by the Senate Armed Services subcommittee on personnel.
While officers with nuclear training - some earning as much as $109,868 a year - ``can still count on finding some type of employment in the civilian sector, their job prospects in related fields are not as promising as in the past,'' the report said.
``For that reason, reductions in nuclear bonuses might not produce unacceptable reductions in the number of nuclear-trained officers in the Navy.''
The Navy, with its fleet shrinking, plans to reduce the number of new nuclear officers by 15 percent from 1994 to 2000. In 1997, the Navy projects it will have 3,274 nuclear submarine officers and 896 nuclear surface officers.
Many of those officers serve aboard attack submarines, aircraft carriers and other ships based at the Norfolk Naval Station.
The bulk of the others are assigned to vessels based in Bremerton, Wash.; Kings' Bay, Ga.; Groton, Conn.; San Diego; and Pearl Harbor, said Capt. Jim Kudla of the Pentagon's Bureau of Naval Personnel.
Navy officials had not seen the report and had no immediate comment on its findings Friday. But they defended the bonuses generally as necessary and cost effective.
``In the long run, we have found it is actually cheaper to pay the bonuses than it is to recruit and then train new folks,'' Kudla said.
Currently, nuclear-trained officers get the $10,000 annual bonus if they sign contracts to extend their stay in the Navy for three, four or five years beyond their initial four-year obligation.
They receive a $7,200-a-year bonus if they remain without a contract. New officers who select the field also receive a one-time, $6,000 bonus.
Under the current program, the Navy expects to fill no more than 85 percent of its total slots next year requiring nuclear submarine officers and 72 percent of the requirements for nuclear surface officers. The Navy anticipates filling 82 percent and 67 percent respectively if the bonuses were eliminated.
Total compensation packages for such officers can vary from $70,909 for a mid-grade officer - a lieutenant commander with 10 years of military service - to $109,868 for a senior officer, a captain with 22 years of military service.
For many of the officers, pension packages are the driving force behind the decision to extend their stay in the service, the report said.
KEYWORDS: U.S. NAVY BONUS NUCLEAR POWERED SUBMARINES by CNB