Mr. MURRAY. We don't have that clause, sir.

Mr. SCAMMAHORN. Not in our prime operating contract.

Mr. MURRAY. I think it is important to recognize that we start out with the notion that the maximum amount will be brought from third parties, and the minimum will be done in our own plants. Really we are starting from that as a base.

Mr. MULTER. Thank you.

Mr. BELLER. Mr. Chairman, on September 16 this committee requested the Atomic Energy Commission to furnish background information in connection with the hearings. I would like to offer for the record the letter requesting the information1 and the response of the Atomic Energy Commission.

Mr. MULTER. Of course, the staff will examine these to make sure the exhibits attached are not duplicated. Otherwise they will be received.

(The response referred to follows.)

Hon. ABRAHAM J. MULTER,
House of Representatives.

U.S. ATOMIC ENERGY COMMISSION,
Washington, D.C., October 9, 1963.

DEAR MR. MULTER: Your letter of September 16, 1963, requested certain information concerning small business procurement policies, programs, procedures, and practices followed by the Atomic Energy Commission.

Essentially, all AEC operations are accomplished through use of contractors. Because a high percentage of AEC contract dollars is spent through AEC prime contracts for operations purposes, the majority of opportunities for small business emerges at the prime contractor level. Our small business program has focused on the subcontracting of the cost-type contractors that operate AEC facilities. AEC pioneered this type of program in 1951, and our contractors have provided good support for the program. The attention given to subcontract awards by our principal cost-type contractors has not precluded a corresponding emphasis on application of the small business program to AEC prime contracts. The low percentage level of small business participation in AEC prime contracts is due primarily to the fact that operation of the industrial complex of AEC plants, laboratories, and other facilities usually requires resources beyond those available to small business. The cornerstone of our small business program is the congressional policy that "a fair proportion of the total purchases and contracts for supplies and services for the Government shall be procured from small business concerns." To this broad policy, the AEC has added a series of detailed policies which will be referred to in the answers to the questions asked.

The following information is furnished in the order requested:

1. Attached are copies of AEC's fiscal year report which includes all prime actions and all subactions by cost-type prime contractors. You will note that in the last column for fiscal year 1960, the total number of actions is 15,580 and the total number of dollars is $3,053,319,247. Likewise, the data is shown for fiscal years 1961, 1962, and 1963.

2. In column No. 2, the total number, dollar, and percentage awarded to small business is shown for fiscal years 1960 through 1963.

3. No records are maintained which would include the information necessary to answer this question. Bidders mailing lists are maintained for all eligible and qualified concerns which have submitted bidders mailing list applications,

1 The September 16 letter referred to appears on p. 1.

and for concerns which are considered capable of filling the requirements of the particular procurement. As much of the mailing list is used as is compatible with efficiency and economy in securing adequate competition. However, in any particular procurement there may be an undetermined number of small business concerns in a broad geographical area which may not be included on the bidders list. In any event, any eligible concern may bid on a particular procurement action which is formally advertised.

4. The total of procurement invitations by number, dollars, and percentage for fiscal years 1960-63 is not available. In 1963, AEC expanded its small business program in accordance with Federal Procurement Regulation 1-1.7 to provide for use of small business subcontracting provisions in subcontracts executed by our prime contractors. AEC has encouraged its major operating contractors to participate in the set-aside program where this will not have the effect of restricting competition or increasing the cost of performance, even though the provisions of FPR 1-1.7 do not require the establishment of a set-aside program by contractors. Also, AEC, working with representatives of the Small Business Administration, has started a program for its cost-type contractors to undertake a unilateral-type set-aside program. For fiscal year 1964, and subsequent, AEC will maintain records of such set-asides and will inform the Small Business Administration on a quarterly basis of the results.

5. The criteria and guidelines which determine a small business set-aside procurement are set forth in Federal Procurement Regulation 1-1.7, as implemented and supplemented by Atomic Energy Commission Procurement Regulation 9-1.7. Also, there has been in effect since October 1960, an agreement for cooperation between AEC and the Small Business Administration, which provides a basis of cooperation in order to further the AEC small business program and the intent of Congress set forth in the Small Business Act. Each AEC Field Office and each cost-type contractor has a small business representative responsible for the small business program and for informing the contracting officer and contractor's buyers as to set-asides, subcontracting, and the small business requirements in general.

6. The techniques and procedures are as provided in the regulations and agreement referred to in the answer to No. 5. AEC contracting officers review and approve recommendations of AEC major cost-type contractors for unilateral set-asides. These contractors also have obligations under the small business subcontracting program clause in their contract as provided in the Federal Procurement Regulations.

7. and 8. The techniques and devices which are employed to encourage small business procurement-both AEC direct procurement and AEC contract dollars going to subcontractors-include: (1) Establishment of small business programs by each AEC field office and cost-type contractor purchasing office; (2) establishment of small business representatives in each field office; (3) determination of procurements suitable for small business; (4) maintenance of maximum opportunity for small business to participate; (5) maintenance of bidders lists, nonrestrictive specifications and progress payments; (6) quarterly statistical reports on small business participation; and (7) written quarterly reports on the operation of each purchasing office's smaller business programs; and (8) during the last year, a series of training meetings were held at the field offices with AEC and contractor personnel emphasizing the small business program including set-asides and subcontracting. These are in addition to the significant policies previously referred to; namely, (1) cooperation with the Small Business Administration, (2) including small business subcontracting program clause in appropriate prime contracts, and (3) increased emphasis on the set-aside program.

If you have any other questions concerning this matter, please do not hesitate to call us.

Sincerely yours,

DWIGHT A. INK, Assistant General Manager.

Number 1 Total value Number 1

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26-024-64-pt. 1-12

1 Number or actions includes original contracts, modifications, amendments, and supplemental agreements.

Type of work

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1 Number or actions includes original contracts, modifications, amendments, and supplemental agreements.