of an advance, as we already have in our laboratories stuff that is ahead of this. We are very alert to that sort of flag.

Mr. DUNCAN. None of you have been cited for contempt yet for failure to reveal those communications with industry.

Dr. WHITE. There is a procedure where the proprietary results of industry sent to us and clearly marked are kept proprietary until at least some contract is signed.

Mr. DUNCAN. The Freedom of Information Act protects you?
Dr. WHITE. Yes.

Dr. SEAMANS. Since you brought that up, we have a recent case. I forget the details of it, but the subcommittee chaired by Mr. Moorehead was investigating it, and they wanted the names of the reviewers. We had already provided the names, not the names themselves but the background of each one of the inside and outside reviewers. We did finally decide that it was all right for the committee to have those names, but in working with the committee we have made it clear that we think it would hurt the process if those names became public.

I really feel that strongly, because pretty soon people will not be willing to serve in this advisory role.

UNSOLICITED PROPOSALS

Mr. DUNCAN. One more question then. Somebody mentioned here earlier that you get a lot of proposals from the colleges.

Do I understand then that your research projects are both initiated inside and outside of your agency? You don't define your objectives and put out invitations? That is one way of doing it.

Dr. SEAMANS. I am sure that on a dollar basis far and away the largest amount of our effort is initiated in-house but it would be wrong I think to imagine that we have all the ideas for new work, and so we review the unsolicited proposals we receive.

Mr. DUNCAN. Mr. Chairman, I have no further questions.

Dr. WHITE. You might be interested in knowing that in fossil energy alone we receive 15 unsolicited proposals a week from both academic and private industry.

Mr. YATES. What does that mean; what kind of proposals?

Dr. WHITE. All the way from basic research to "Help us. We have brought it up to a pilot plant stage. We are now ready to spend $50 million, and please give us $49 million."

Mr. McKAY. I think that those who are expecting themselves to be pushed along in the academic community are going to come to you because they see no other way at the present time. But there are many companies who are solvent themselves, and they are moving along, but who are scared to death to come and tell you what they have got. You probably don't get them to come and see you unless they have had some experience. Exxon may be badgered to the point that they figure they have got to come around to show you some things. Mr. YATES. Are you saying that Exxon ought to be badgered more? Mr. McKAY. That might be one conclusion.

PROPRIETARY DATA

Mr. DUNCAN. Will you send me a copy on proprietary rights?
Mr. YATES. I think we ought to insert the information in the record.
Mr. DUNCAN. There might be a couple of illustrative forms you use.
[The information follows:]

PART 9-3-PROCUREMENT BY NEGOTIATION

19-3.000 Scope of part.

This part implements and supplements the policies and procedures governing procurement by negotiation set forth in FPR Part 1-3.

Subpart 9-3.1 - Use of Negotiation

19-3.103 Dissemination of procurement information.

See 10 CFR Part 709, Public Records, for regulations relating to the availability of ERDA records to the public.

$9-3.150 Treatment of proposal information.

49-3.150-1 General.

It is the general policy of ERDA to use information contained in proposals only for evaluation purposes except to the extent such information is generally available to the public, is already the property of the Government or the Government already has unrestricted use rights, or is or has been made available to the Government from other sources, including the proposer, without restriction. As a practical matter, ERDA cannot assume any responsibility for disclosure or use of any such information unless it is identified by the proposer in accordance with this section. ERDA will not refuse to consider an unsolicited proposal, or a solicited proposal unless the solicitation specifies otherwise, merely because the proposal is restrictively marked. (See also Subparts 9-4.51 and 9-4.52, and 10 CFR Part 709.)

89-3.150-2 Proprietary data.

A proposal may, unless the solicitation specifies otherwise in the case of a solicited proposal, include proprietary data which the proposer does not want disclosed to the public or used by the Government for any purpose other than proposal evaluation. Such proprictary data must be specifically identified and marked as such on every page where it may be contained, in which event it will be used only for proposal evaluation purposes unless it is within the exception set forth in 89-3.150-1. In such cases, the data so identified and marked will not be otherwise used or disclosed without the proposer's written permission, except to the extent it is within the exception in $9-3.150-1 or as provided in any resulting contract.

89-3.150-3 Privileged business information.

A proposal may contain business information which the proposer does not want disclosed outside the Government except for proposal evaluation purposes. Such privileged business information must be specifically identified and marked as such on every page where it may be contained, in which event it will be disclosed outside the Government only for proposal evaluation purposes unless the information is excepted information as set forth in §9-3.150-1. Regarding disclosure to other offerors, see FPR 1-3.103(b).

89-3.150-4 Handling notice.

In order that restrictively marked proposals may be handled consistently with the policies set forth in this section, the following notice shall be affixed to each such proposal upon receipt by ERDA. Use of the following notice neither alters any obligation of the Government, nor diminishes any rights in the Government to use or disclose data or information.

NOTICE FOR Handling Restrictively Marked PROPOSALS

This proposal shall be used, or duplicated, only for ERDA evaluation purposes and this notice shall be applied to any reproduction or abstract thereof. Disclosure of this proposal outside the Government for ERDA evaluation purposes shall not be made unless the provisions of ERDA

PROCUREMENT BY NEGOTIATION

Procurement Regulation 9-3.150-5 are followed. The restrictions contained in this notice do not apply to any data or business information contained in this proposal if it is already generally available to the public, is already available to the Government on an unrestricted basis or is the property of the Government, or is or becomes available from another source, including the proposer, without restriction.

19-3.150-5 Disclosure outside Government.

(a) Policy. It is the policy of ERDA to have proposals evaluated by the most competent persons available in Government and contractor organizations operating and managing ERDA facilities. In addition, ERDA frequently meets its evaluation needs by having proposals reviewed by evaluators outside the Government (or contractor organizations operating and managing ERDA facilities). Such latter outside evaluations may be made:

(1) Of research proposals from educational and other appropriate not-for-profit institutions pursuant to §9-4.5106-3, provided any proposal which expressly indicates that only Government evaluation is authorized shall not be disclosed without the proposer's written consent.

(2) Of other proposals, provided the requirements in (b) and (c) below are met. (b) Approval. Decisions in ERDA Headquarters to evaluate proposals covered by 19-3.150-5(a)(2) outside the Government (or contractor organizations operating and managing ERDA facilities) for ERDA evaluation purposes shall be made by the responsible program Division Director, and in ERDA field offices by the Field Office Manager. Such decisions shall take into consideration ERDA requirements for avoidance of organizational conflicts of interest set forth in Subpart 9-1.54 and the competitive relationship, if any, between the proposer and the prospective outside evaluator. In addition, if the proposal under consideration expressly indicates that only Government evaluation is authorized and evaluation outside the Government is nevertheless desired, the proposer should be advised that ERDA may be unable to give full consideration to the proposal unless the proposer consents in writing to having the proposal evaluated outside the Government.

(c) Agreement with evaluator. Where it is determined pursuant to §9-3.150-5(b) to evaluate a proposal outside the Government (or contractor organizations operating and managing ERDA facilities) the following agreement, or an equivalent arrangement for the treatment of the proposal, shall be obtained from the outside evaluator before ERDA furnishes a copy of the proposal to such person. In addition, care should be taken that the note required by $9-3.150-4 is affixed to the proposal before it is disclosed to the evaluator.

CONDITIONS For Evaluating Proposals

Whenever ERDA furnishes a proposal for evaluation, the recipient agrees to use the information contained in the proposal only for ERDA evaluation purposes. This requirement does not apply to information obtainable from another source, including the proposer, without restriction. Any notice or restriction placed on the proposal by either ERDA or the originator of the proposal shall be conspicuously affixed to any reproduction or abstract thereof. Upon completion of the evaluation, the recipient shall return all copies of the proposal and abstracts, if any, to the ERDA office which initially furnished the proposal for evaluation. Unless authorized by the ERDA initiating of fice, the recipient shall not contact the originator of the proposal concerning any aspect of its contents.

Subpart 9-3.2-Circumstances Permitting Negotiation

19-3.200 Scope of subpart.

Section 302(c) of the Federal Property and Administrative Services Act of 1949, as amended, authorizes the negotiation of contracts, and is applicable to AEC (now ERDA) procurement. Section 302(c)(15) of the Federal Property and Administrative Services Act of 1949, as amended, permits negotiation when otherwise authorized by law, provided that in such event the requirements of that Act,shall apply. Accordingly when the Federal Property and Administrative Services Act of 1949, as amended, or the Atomic Energy Act of 1954, as amended, or other law is used as the basis for negotiation, the requirements of section 304 of the Federal Property and Administrative Services Act of 1949, as amended, are applicable, except as provided in these regulations.

89-3.202 [Reserved]

89-3.204 Personal or professional services.

Formal advertising procedures shall not be used for contracts for architect-engineer or other professional engineering services. Such contracts may be negotiated under section 302(c)(4) of the Federal Property and Administrative Services Act of 1949, as amended, or section 302(c)(15) of that Act and the Atomic Energy Act of 1954, as amended. However, the exemption provided for in §9-3.405-5(c) does not apply to contracts negotiated under section 302(c)(4) of the Federal Property and Administrative Services Act of 1949, as amended.

49-3.211 [Reserved]

89-3.213 Technical equipment requiring standardization and interchangeability of parts.

If section 302(c)(15) of the Federal Property and Administrative Services Act of 1949, as amended, and the Atomic Energy Act of 1954, as amended, are used as the bases for negotiation, the example of findings and determinations set forth in FPR 1-3.213(e)(2) shall be appropriately modified to state the authority for negotiation.

89-3.215 Otherwise authorized by law.

(a) The Atomic Energy Act of 1954, as amended, and the Atomic Energy Community Act of 1955, as amended, contain various exemptions from section 3709 of the Revised Statutes, as amended. Pursuant to section 310 of the Federal Property and Administrative Services Act of 1949, as amended, these references to section 3709 shall be construed to authorize procurement pursuant to section 302(c)(15) of the Federal Property and Administrative Services Act of 1949, as amended, without regard to the advertising requirements of sections 302(c) and 303 of that Act.

(b) The Atomic Energy Act of 1954, as amended, also provides in section 162 that the President may, in advance, exempt any specific action of the Commission (now ERDA) in a particular matter from the provisions of law relating to contracts whenever he determines that such action is essential in the interest of the common defense and security.

(c) Every contract negotiated under the authority of section 302(c)(15) of the Federal Property and Administrative Services Act of 1949, as amended, and the Atomic Energy Act of 1954, as amended, shall be supported by a determination and findings justifying use of such authority.