Navy Acquisition via leasing: policy, politics, and polemics with the Maritime Prepositioned Ships
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Authors
San Miguel, Joseph G.
Shank, John K.
Summers, Donald E.
Subjects
Marine Engineering
Armed Forces Procurement
Tankers
Armed Forces Procurement
Tankers
Advisors
Date of Issue
2005
Date
2005
Publisher
Monterey, California. Naval Postgraduate School
Language
Abstract
In recent months, leasing has been prominent in the press in connection with the Air Force's ill-fated attempt to obtain the use of Boeing re-fueling tankers without buying them. Gone from memory is the early 1980's controversial Navy leasing program of Maritime Pre-positioned Ships that had a different result. This paper presents an analysis of the various issues and parties to the very creative and innovative financing on behalf of the Navy's Military Sealift Command. Still in existence today, the 1983 contracts for thirteen TAKX ships were valued at approximately $2.6 billion. While the decision is often framed as a lease versus purchase choice, the facts indicate that the option to purchase was not seen as viable at the time. In hindsight, the TAKX leasing program was successful and cost effective, despite the whirlwind of political commentary and intrigue and the dueling quantitative analyses surrounding it. However, as an unintended (or, perhaps, intended) consequence, laws and policies have since been changed so that leasing is no longer viable for financing military assets. The case presented here considers altering existing laws and regulations to once again permit leasing of military resources.
Type
Technical Report
Description
Series/Report No
Department
Graduate School of Business & Public Policy (GSBPP)
Organization
Identifiers
NPS Report Number
NPS-GSBPP-05-004
Sponsors
Funder
Format
ix, 37 p.: ill.;28 cm.
Citation
Distribution Statement
Approved for public release; distribution is unlimited.