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WELFARE: REFERENCE IS MADE TO A LETTER DATED DECEMBER 28. WAS AWARDED THE NEW ORLEANS CONTRACT ON JUNE 22. WAS AWARDED THE CHICAGO AND SEATTLE CONTRACTS ON JUNE 29. IT IS REPORTED THAT AT THE TIME THE AWARDS WERE MADE. WHEREBY BUILDINGS WERE CONSTRUCTED TO GOVERNMENT SPECIFICATIONS AND THEREAFTER LEASED BY THE OWNERS TO THE GOVERNMENT FOR OCCUPANCY BY FEDERAL AGENCIES. THE NATURE OF THE EQUIPMENT AND ITS INSTALLATION ARE SUCH THAT FDA CONSIDERED IT NECESSARY TO HAVE THE EQUIPMENT INSTALLED DURING THE BUILDING CONSTRUCTION AND TO REQUIRE THE EQUIPMENT INSTALLED DURING THE BUILDING CONSTRUCTION AND TO REQUIRE THE EQUIPMENT CONTRACTOR IN EACH CASE TO COORDINATE HIS WORK WITH THAT OF THE BUILDING CONTRACTOR.

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B-158261, MAR. 9, 1966

TO SECRETARY OF HEALTH, EDUCATION, AND WELFARE:

REFERENCE IS MADE TO A LETTER DATED DECEMBER 28, 1965, FROM THE UNDER SECRETARY, REQUESTING OUR DECISION ON SEVERAL QUESTIONS PERTAINING TO THREE SUPPLY CONTRACTS AWARDED IN 1962 BY THE FOOD AND DRUG ADMINISTRATION (FDA) FOR THE FURNISHING AND INSTALLATION OF LABORATORY FURNITURE AND EQUIPMENT IN FDA DISTRICT OFFICE BUILDINGS TO BE CONSTRUCTED IN NEW ORLEANS, LOUISIANA, CHICAGO, ILLINOIS, AND SEATTLE, WASHINGTON. LABORATORY FURNITURE COMPANY, INC. (LABORATORY FURNITURE), RICHMOND, VIRGINIA, WAS AWARDED THE NEW ORLEANS CONTRACT ON JUNE 22, 1962, IN THE AMOUNT OF $215,350, AND METALAB EQUIPMENT COMPANY (METALAB), HICKSVILLE, LONG ISLAND, NEW YORK, WAS AWARDED THE CHICAGO AND SEATTLE CONTRACTS ON JUNE 29, 1962, IN THE AMOUNTS OF $317,011 AND $222,516, RESPECTIVELY.

IT IS REPORTED THAT AT THE TIME THE AWARDS WERE MADE, CONSTRUCTION OF THE BUILDINGS HAD NOT COMMENCED BUT FDA EXPECTED THE BUILDINGS TO BE CONSTRUCTED UNDER THE GENERAL SERVICES ADMINISTRATION (GSA) LEASE CONSTRUCTION PROGRAM, WHEREBY BUILDINGS WERE CONSTRUCTED TO GOVERNMENT SPECIFICATIONS AND THEREAFTER LEASED BY THE OWNERS TO THE GOVERNMENT FOR OCCUPANCY BY FEDERAL AGENCIES. SEVERAL BUILDINGS OCCUPIED BY FDA HAD PREVIOUSLY BEEN CONSTRUCTED AND LEASED UNDER THAT PROGRAM. THE NATURE OF THE EQUIPMENT AND ITS INSTALLATION ARE SUCH THAT FDA CONSIDERED IT NECESSARY TO HAVE THE EQUIPMENT INSTALLED DURING THE BUILDING CONSTRUCTION AND TO REQUIRE THE EQUIPMENT INSTALLED DURING THE BUILDING CONSTRUCTION AND TO REQUIRE THE EQUIPMENT CONTRACTOR IN EACH CASE TO COORDINATE HIS WORK WITH THAT OF THE BUILDING CONTRACTOR. FURTHER, IN ORDER TO ALLOW THE EQUIPMENT CONTRACTORS TIME TO PREPARE SHOP DRAWINGS REQUIRED BY THE CONTRACT AND TO MANUFACTURE THE EQUIPMENT, IT WAS CONSIDERED NECESSARY TO AWARD THE EQUIPMENT CONTRACTS BEFORE THE BUILDING CONSTRUCTION CONTRACTS WERE AWARDED.

THE INVITATIONS TO BID, THE TERMS OF WHICH WERE INCORPORATED IN THE CONTRACTS, ADVISED BIDDERS THAT THE GOVERNMENT WAS NOT IN A POSITION TO STATE AT THAT TIME WHEN BUILDING CONSTRUCTION WOULD COMMENCE OR TO FURNISH INFORMATION AS TO THE OWNERS, THE ARCHITECTS OR THE BUILDING CONTRACTORS. HOWEVER, SHOP DRAWINGS WERE REQUIRED TO BE SUBMITTED FOR APPROVAL WITHIN FOUR WEEKS AFTER DATE OF RECEIPT OF NOTICE OF AWARD OF THE CONTRACTS, AND PROVISION WAS MADE FOR ADVANCE 60-DAY NOTICES TO PERMIT EQUIPMENT FABRICATION, IF NECESSARY, AND FOR A SUBSEQUENT NOTICE IN EACH CASE TO COMMENCE INSTALLATION. WHILE EACH OF THE CONTRACTORS HAD PREVIOUSLY PERFORMED SIMILAR CONTRACTS UNDER THE SAME TERMS FOR FDA, IT IS STATED THAT FDA RECORDS REVEAL THAT THE ELAPSED TIME BETWEEN THE DATE OF AWARD AND THE ISSUANCE OF THE PRELIMINARY NOTICE TO PROCEED IN ALL PREVIOUS CONTRACTS TO INSTALL EQUIPMENT IN FDA DISTRICT OFFICES, INCLUDING THE CONTRACTS WITH LABORATORY FURNITURE AND METALAB, DID NOT EXCEED 34 MONTHS AND RANGED DOWN TO A MINIMUM OF 5 1/2 MONTHS. LABORATORY FURNITURE HAS STATED THAT ITS PREVIOUS EXPERIENCE IS SUCH CONTRACTS WITH FDA REFLECTS AN AVERAGE TIME ALLOWANCE OF 12 MONTHS FOR DELIVERY.

EACH CONTRACT INCLUDES A "CHANGES" CLAUSE PROVIDING FOR EQUITABLE ADJUSTMENT INCIDENT TO CHANGES WITHIN THE GENERAL SCOPE OF THE CONTRACT AND A DEFAULT CLAUSE CONCERNING DELAYS BY THE CONTRACTOR. THERE IS NO PROVISION, HOWEVER, FOR TERMINATION FOR CONVENIENCE OF THE GOVERNMENT, NOR DO THE CONTRACTS CONTAIN SUSPENSION OF WORK CLAUSES.

ON OCTOBER 3, 1962, WITHIN LESS THAN FOUR MONTHS AFTER THE AWARDS, CONGRESS ENACTED THE INDEPENDENT OFFICES APPROPRIATION ACT, 1963, 76 STAT. 716 ET SEQ., WHICH INCLUDED AS A GENERAL PROVISION UNDER THE APPROPRIATION HEADING "GENERAL SERVICES ADMINISTRATION" A RESTRICTION ON THE USE OF FUNDS APPROPRIATED THEREUNDER FOR THE PAYMENT OF RENTAL FOR SPACE OCCUPIED BY FEDERAL AGENCIES IN BUILDINGS CONSTRUCTED AT A COST IN EXCESS OF $200,000 UNDER THE LEASE-CONSTRUCTION PROGRAM. (A SIMILAR LIMITATION HAS APPEARED IN EACH SUBSEQUENT INDEPENDENT OFFICES APPROPRIATION ACT.) ACCORDINGLY, GSA ABANDONED ITS ORIGINAL PLANS FOR CONSTRUCTION OF THE BUILDINGS UNDER THE LEASE-CONSTRUCTION PROGRAM, AND THE BUILDINGS WILL BE CONSTRUCTED FOR GOVERNMENT OWNERSHIP. BY REASON OF THE CHANGE TO GOVERNMENT OWNERSHIP, CONSIDERABLE DELAY HAS ENSUED IN THE ISSUANCE OF THE NOTICES TO PROCEED BECAUSE OF THE NEED FOR ADDITIONAL TIME FOR PLANNING, FOR ACQUISITION AND PREPARATION OF BUILDING SITES, FOR THE PREPARATION OF BUDGET REQUESTS, AND FOR OBTAINING APPROPRIATIONS. AS A RESULT, THE DATE OF COMMENCEMENT OF CONSTRUCTION OF THE BUILDINGS CANNOT YET BE PREDICTED WITH ACCURACY. IT IS ANTICIPATED, HOWEVER, THAT NOTICES TO PROCEED UNDER THE EQUIPMENT CONTRACTS CANNOT BE ISSUED ANY EARLIER THAN THE LATTER PART OF 1967, WHICH WILL BE MORE THAN FIVE YEARS AFTER THE CONTRACT AWARD DATES. CONSEQUENTLY, LABORATORY FURNITURE HAS REQUESTED, ON THE BASIS THAT PRICES HAVE INCREASED SUBSTANTIALLY SINCE JUNE 1962, THAT ITS CONTRACT BE TERMINATED, AND HAS SUBMITTED AN INVOICE FOR CANCELLATION COSTS TOTALLING $12,070, REPRESENTING COSTS INVOLVED IN PARTIAL PERFORMANCE OF THE CONTRACT. LABORATORY FURNITURE HAS FURNISHED 61 PERCENT OF THE SHOP DRAWINGS FOR THE NEW ORLEANS LABORATORY WHICH WERE REQUIRED TO BE SUBMITTED FOR APPROVAL WITHIN FOUR WEEKS AFTER RECEIPT OF NOTICE OF AWARD. IT IS REPORTED, HOWEVER, THAT THE CONTRACTOR HAS INDICATED INFORMALLY TO FDA THAT IT IS WILLING TO PERFORM THE CONTRACT PROVIDED AN ADJUSTMENT IS MADE IN THE CONTRACT PRICE BASED ON INCREASED COSTS SINCE THE DATE OF AWARD. THE OTHER CONTRACTOR, METALAB, HAS MADE NO REQUEST FOR RELIEF, EITHER BY CONTRACT TERMINATION OR ADJUSTMENT OF ITS CONTRACT PRICES, AND HAS SUBMITTED 57 PERCENT OF THE DRAWINGS FOR THE LABORATORIES AT CHICAGO AND SEATTLE.

IN ADDITION TO THE PROBLEMS WHICH HAVE BEEN PRESENTED BY THE LONG DELAY BETWEEN THE CONTRACT AWARD DATES AND THE EXPECTED DATE ON WHICH NOTICES TO PROCEED WILL BE ISSUED--- APPROXIMATELY 64 MONTHS AS OPPOSED TO 5 1/2 TO 34 MONTHS UNDER PREVIOUS SIMILAR CONTRACTS--- SEVERAL QUESTIONS HAVE ARISEN BECAUSE OF THE EXPANSION, SUBSEQUENT TO THE AWARDS, OF FDA'S REQUIREMENTS, WHICH WILL NECESSITATE THE PURCHASE OF ADDITIONAL EQUIPMENT.

IN VIEW OF THE FOREGOING OUR DECISION IS REQUESTED ON THE FOLLOWING QUESTIONS:

"1. IS FDA REQUIRED TO COMPLY WITH THE REQUEST OF LABORATORY FURNITURE CO., INC. TO TERMINATE THE NEW ORLEANS CONTRACT BECAUSE OF THE LONG DELAY FROM THE DATE OF AWARD OF THE CONTRACT TO THE ANTICIPATED DATE WHEN THE NOTICE TO PROCEED CAN BE ISSUED?

"2. IS FDA REQUIRED TO TERMINATE THE CHICAGO AND SEATTLE CONTRACTS WITH METALAB EQUIPMENT CO. EVEN THOUGH THE CONTRACTOR HAS NOT REQUESTED TERMINATION?

"3. IF ANY OR ALL OF THE CONTRACTS ARE TERMINATED, WOULD THE FUNDS OBLIGATED FOR THE CONTRACTS BE AVAILABLE FOR THE REPLACEMENT CONTRACTS TO BE AWARDED?

"4. MAY THE CHICAGO AND NEW ORLEANS CONTRACTS BE AMENDED TO INCLUDE THE ADDITIONAL EQUIPMENT REQUIRED BY FDA'S EXPANDED NEEDS?

"5. MAY THE CONTRACT PRICE OF THE EQUIPMENT REQUIRED TO BE INSTALLED UNDER THE ORIGINAL CONTRACTS AT ALL THERE LOCATIONS BE INCREASED TO TAKE INTO ACCOUNT INCREASED COSTS SINCE THE DATES OF AWARD OF THE CONTRACTS?

IN VIEW OF THE FACT THAT ALL OF THE CONTRACTS IN QUESTION INCLUDED A STATEMENT TO THE EFFECT THAT THE DATE OF COMMENCEMENT OF BUILDING CONSTRUCTION COULD NOT BE STATED BY THE GOVERNMENT, AND INASMUCH AS THE CONTRACTORS HAD PREVIOUSLY PERFORMED SIMILAR CONTRACTS AWARDED IN LIKE CIRCUMSTANCES, IT IS APPARENT THAT IT WAS WITHIN THE CONTEMPLATION OF THE PARTIES THAT A CONSIDERABLE DELAY MIGHT BE ENCOUNTERED BEFORE NOTICES TO PROCEED WOULD BE ISSUED TO THE CONTRACTORS. ACCORDINGLY, SINCE THERE WAS NO PROVISION IN THE CONTRACTS FOR RELIEF IN THE EVENT OF DELAY BY THE GOVERNMENT, AND SINCE THE DELAY WAS NOT ATTRIBUTABLE TO ANY WILLFUL ACTION BY THE GOVERNMENT BUT APPEARS TO HAVE HAD ITS ORIGIN IN AN EXERCISE BY THE CONGRESS OF ITS LEGISLATIVE POWER, IT IS OUR VIEW THAT THERE IS NO PRESENT BREACH OF THE CONTRACT WHICH WOULD GIVE RISE TO LEGAL LIABILITY ON THE PART OF THE GOVERNMENT FOR DAMAGES AS A CONSEQUENCE OF THE DELAY.

CONCERNING LABORATORY FURNITURE'S INFORMAL INDICATION (AND QUESTION NO. 5 ABOVE IN CONJUNCTION THEREWITH), THAT IT IS WILLING TO PERFORM THE CONTRACT PROVIDED AN ADJUSTMENT IS MADE IN THE CONTRACT PRICE TO COVER ALLEGED INCREASES IN COSTS SUBSEQUENT TO THE DATE OF AWARD, THERE IS FOR CONSIDERATION THE WELL-ESTABLISHED PRINCIPLE OF LAW THAT VALID CONTRACTS ARE TO BE ENFORCED AS WRITTEN AND THE FACT THAT SUPERVENING OR UNFORESEEN CAUSES RENDER PERFORMANCE MORE BURDENSOME OR LESS PROFITABLE, OR EVEN OCCASION A LOSS, IS NOT SUFFICIENT TO ENTITLE A CONTRACTOR TO ADDITIONAL COMPENSATION. 19 COMP. GEN. 560. FURTHER, A GOVERNMENT CONTRACT MAY NOT BE MODIFIED OR AMENDED EXCEPT ON THE BASIS OF ADDITIONAL CONSIDERATION AND IN THE INTEREST OF THE UNITED STATES. 43 COMP. GEN. 392, 395. LIKEWISE, IT SEEMS THAT SINCE THERE WAS NO PROVISION IN THE CONTRACT ESTABLISHING A TIME FOR PERFORMANCE, A REASONABLE TIME MIGHT BE IMPLIED, AND THE CONTRACTOR THEREFORE WOULD BE LEGALLY OBLIGATED TO ABSORB ALL COST INCREASES OCCURRING PRIOR TO THE EXPIRATION OF SUCH TIME WHICH MAY BE CONSIDERED REASONABLE UNDER THE CIRCUMSTANCES. COMPARE MERRITT-CHAPMAN AND SCOTT CORPORATION V. UNITED STATES, COURT OF CLAIMS NO. 69-62, JANUARY 21, 1966. HAVING CONCLUDED THAT THERE IS NO PRESENT BREACH OF CONTRACT BY THE GOVERNMENT, WE FAIL TO SEE WHERE THERE WOULD BE ADEQUATE CONSIDERATION MOVING TO THE UNITED STATES SHOULD THE CONTRACT BE MODIFIED TO GRANT THE REQUESTED PRICE INCREASE, AN ACTION WHICH MIGHT ALSO BE REGARDED AS CONSTITUTING THE MAKING OF A NEW CONTRACT WITHOUT ADVERTISING IN VIOLATION OF THE PROVISIONS OF 41 U.S.C. 252/C). 22 COMP. GEN. 1087. ACCORDINGLY, IT IS OUR VIEW THAT SUCH ACTION IS NOT AUTHORIZED AND, THEREFORE, QUESTION NO. 5 IS ANSWERED IN THE NEGATIVE.

WITH SPECIFIC REFERENCE, HOWEVER, TO WHETHER LABORATORY FURNITURE MAY BE RELIEVED FROM ITS CONTRACTUAL OBLIGATIONS, IT SEEMS CLEAR THAT THE CONTRACT WAS ENTERED INTO IN EXPECTATION THAT THE CONSTRUCTION OF THE BUILDING WOULD SOON COMMENCE UNDER THE GSA LEASE-CONSTRUCTION PROGRAM, AND THAT THE TIME FOR INSTALLATION OF THE LABORATORY EQUIPMENT WOULD BE DEPENDENT PRIMARILY UPON THE RATE OF CONSTRUCTION OF THE BUILDING AS PLANNED UNDER THAT PROGRAM. AS STATED PREVIOUSLY, THE LONGEST SUCH TIME IN FDA'S CONTRACTING HISTORY IS REPORTED TO BE 34 MONTHS, AND LABORATORY FURNITURE STATES THAT ITS PAST EXPERIENCE UNDER SUCH OPERATIONS REFLECT AN AVERAGE WAITING PERIOD OF ONLY 12 MONTHS. THE UNDER SECRETARY'S LETTER OF DECEMBER 28 DOES NOT INDICATE THAT ADDITIONAL DELAYS, NOT PERTAINING TO ACTUAL CONSTRUCTION MATTERS AND ASSOCIATED WITH THE CHANGE TO GOVERNMENT OWNERSHIP OF THE BUILDING, SHOULD HAVE BEEN ANTICIPATED BY EITHER FDA OR LABORATORY FURNITURE. WE FEEL, THEREFORE, THAT THE FACTS MANIFEST SUCH STRONG ELEMENTS OF FRUSTRATION OF CONTRACT PERFORMANCE IN THE MANNER ORIGINALLY CONTEMPLATED BY THE PARTIES THAT IT WOULD BE IMPRACTICAL FOR THE GOVERNMENT TO ATTEMPT TO CONTINUE TO HOLD LABORATORY FURNITURE TO THE EXPRESS TERMS OF THE CONTRACT UNTIL SOME INDEFINITE FUTURE TIME--- BUT NOT BEFORE LATE 1967--- WHEN IT MIGHT BE NOTIFIED TO PERFORM. 27 COMP. GEN. 225. IN VIEW OF THE FOREGOING, QUESTION NO. 1 IS ANSWERED IN THE AFFIRMATIVE, AND SETTLEMENT MAY BE MADE OF THE CONTRACTOR'S CLAIM, IF OTHERWISE CORRECT.

WHILE WE HAVE CONCLUDED THAT THE CONTRACT WITH LABORATORY FURNITURE MAY BE TERMINATED BY AGREEMENT IN RESPONSE TO ITS REQUEST, AND THE SAME CONCLUSION WOULD APPEAR TO BE APPROPRIATE IN THE EVENT METALAB REQUESTS TERMINATION, WE DO NOT BELIEVE THAT THE CIRCUMSTANCES ESTABLISH THAT THE BEST INTERESTS OF THE GOVERNMENT REQUIRE A UNILATERAL TERMINATION OF THE METALAB CONTRACTS. CONVERSELY, IN THE EVENT THAT FIRM SHOULD INDICATE A WILLINGNESS TO HONOR THE CONTRACTS FOR PERFORMANCE AT THE CONTRACT PRICES AND AT THE FUTURE TIME NOW ANTICIPATED, AND SINCE IT IS QUESTIONABLE THAT METALAB WOULD BE LEGALLY OBLIGATED TO ABIDE BY THE TERMS OF ITS CONTRACTS IF NOTICES TO PROCEED ARE GIVEN IT IN THE LATTER PART OF 1967,IT WOULD APPEAR THAT A SUPPLEMENTAL AGREEMENT SHOULD BE EXECUTED WHICH SPECIFIES THE NEW CONTEMPLATED TIME FOR PERFORMANCE. QUESTION NO. 2 IS ANSWERED ACCORDINGLY.

CONCERNING THE AVAILABILITY OF THE BALANCE OF SUCH 1962 FISCAL YEAR FUNDS FOR REPLACEMENT CONTRACTS, INASMUCH AS IT APPEARS THAT THE ORIGINAL CONTRACTS REPRESENT VALID OBLIGATIONS OF THAT FISCAL YEAR FOR EQUIPMENT FOR WHICH THERE HAS BEEN A CONTINUING NEED, THE BALANCE OF THE FUNDS OBLIGATED FOR THE CONTRACTS SHOULD BE CONSIDERED AS REMAINING AVAILABLE FOR THE FULFILLMENT OF SUCH NEED. ON THE OTHER HAND, THE COST OF ANY ADDITIONAL EQUIPMENT SHOULD BE CHARGED TO THE APPROPRIATION CURRENT AT THE DATE OF THE NEW AGREEMENT. QUESTION NO. 3 IS ANSWERED ACCORDINGLY.

REGARDING THE PROPRIETY OF AMENDING THE CHICAGO AND NEW ORLEANS CONTRACTS TO INCLUDE THE ADDITIONAL EQUIPMENT REQUIRED BY THE EXPANDED NEEDS OF FDA, INASMUCH AS THE NEW ORLEANS CONTRACT PRESUMABLY WILL BE TERMINATED BY REASON OF OUR ANSWERS TO QUESTIONS NOS. 1 AND 5, THERE IS FOR CONSIDERATION IN THIS RESPECT ONLY THE CHICAGO CONTRACT. IN THE UNDER SECRETARY'S LETTER THE COST OF THE NEW EQUIPMENT FOR THE CHICAGO BUILDING IS ESTIMATED AT $58,500 OR APPROXIMATELY 18 PERCENT OF THE PRICE OF THE ORIGINAL CONTRACT. ALTHOUGH IT IS ACKNOWLEDGED IN THE LETTER THAT UNDER A LONG STANDING RULE AN EXISTING CONTRACT MAY NOT BE EXPANDED TO INCLUDE ADDITIONAL WORK OF ANY CONSIDERABLE MAGNITUDE WITHOUT ADVERTISING FOR BIDS FOR THE ADDITIONAL WORK, IT IS URGED THAT THE SITUATION HERE CONCERNED COMES WITHIN THE EXCEPTION WHICH PERMITS CONTRACT MODIFICATION WHEN THE ADDITIONAL WORK WAS NOT CONTEMPLATED BY THE GOVERNMENT AT THE TIME THE CONTRACT WAS AWARDED AND IS SUCH AN INSEPARABLE PART OF THE WORK ORIGINALLY CONTRACTED FOR AS TO RENDER IT REASONABLY IMPOSSIBLE FOR PERFORMANCE BY A CONTRACTOR OTHER THAN THE ORIGINAL CONTRACTOR. ADDITION TO SETTING FORTH NUMEROUS PROBLEMS AND DIFFICULTIES WHICH ARE STATED TO BE ATTENDANT TO HAVING SEPARATE CONTRACTORS INSTALL EQUIPMENT FOR THE LABORATORY AT THE SAME TIME, IT IS STRESSED, IN SUPPORT OF THE CONCLUSION THAT NEGOTIATIONS SHOULD BE CONDUCTED WITH THE ORIGINAL CONTRACTOR FOR FURNISHING THE ADDITIONAL EQUIPMENT, THAT FDA NEEDS UNIFORM EQUIPMENT WITHIN EACH LABORATORY. ALTHOUGH THE EQUIPMENT WOULD BE MANUFACTURED TO MEET THE SAME SPECIFICATIONS, IT IS ASSERTED THAT SUCH EQUIPMENT WOULD VARY IN ACCORDANCE WITH THE MANUFACTURING STANDARDS OF EACH CONTRACTOR AND THAT SUCH LACK OF UNIFORMITY IN THE EQUIPMENT BEING USED BY THE SCIENTISTS AND TECHNICIANS WOULD ADVERSELY AFFECT THE WORK OF THE LABORATORY. IN VIEW OF SUCH CONSIDERED JUDGMENT BY YOUR DEPARTMENT, PLUS THE OTHER STATED REASONS AND THE FACT THAT THE COMPARATIVELY SMALL AMOUNT INVOLVED WOULD TEND TO LIMIT COMPETITION IN FORMAL ADVERTISING, WE DO NOT FEEL THAT WE WOULD BE REQUIRED TO INTERPOSE ANY OBJECTION TO CONSIDERATION BEING GIVEN TO PROCURING THE ADDITIONAL REQUIREMENTS FOR THE CHICAGO LABORATORY BY NEGOTIATION WITH METALAB UNDER PARAGRAPH 1 3.210 OF THE FEDERAL PROCUREMENT REGULATIONS. QUESTION NO. 4, INSOFAR AS IT RELATES TO THE CHICAGO CONTRACT, IS THEREFORE ANSWERED IN THE AFFIRMATIVE.

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