Contract Drafting A large amount of work consists of drafting various non-routine formal documents for SFO. Most important of the drafting work is contract drafting, although considerable time has been spent on ordinances for the County of Los Alamos, concessionaire and other licenses, and leases, Many of the large SFO operating contracts were drafted by this office, for example, the Dow Chemical Company contract. Large cost-type construction contracts, such as the Austin Company's contract, have been drafted. Among the unusual contracts drafted are the fixed price security contract at Las Vegas, unique because this type of contract is not normally advertised for bids on a fixed price basis. Another con- tract was unique because it was an advertised fixed price contract covering feeding and housing at the Nevada Proving Grounds. Hearings, Negotiations, and Advice In the Spring of 1951, this office appeared for and represented the AEC at a Federal Power Commission hearing in Washington, D. C., pertainingto a proposed withdrawal of natural gas from the San Juan basin (the source of gas for Los Alamos) by the El Paso Natural Gas Company. In the Spring of 1953, the Teamsters Union in Las Vegas set out to organize the guards employed by the fixed price guard contractor at the test site. Had the organizational efforts of the Teamsters Union succeeded, the normal turbulence connected with contract negotiation would have occurred during the 1953 Spring series of tests. For this reason, and because of the danger of divided loyalty, it was the desire of management to keep the guards out of the Teamsters Union if possible. <A provision of the Taft-Hartley Act seemedto prohibit the representation of guards by the Teamsters Union, but decisions of the National Labor Relations Board interpreted this provision in such a way that the prohibition would not apply in this case. Through this office's efforts, in cooperation with Personnel and Organization in Albuquerque and Washington, the National Labor Re- lations Board eventually decided that the Taft-Hartley Act did forbid NPG guards from being represented by the Teamsters Union. In 1952, the Carson Case was decided by the Supreme Court of the United States. The opinion in this case contained an extremely broad interpretation of the tax exemption provision in Section 9(b) of the Atomic Energy Act. Many problems arising out of the ap- plication of the language of that opinion to the SFO situation in various states were created. Particular problems arose in connection with the sales and use taxes of California and Iowa. These latter problems were eventually resolved primarily by personal conferences between members of this office and state taxing authorities. The positions adopted by this office in these conferences have for the most part eventually been accepted by the state taxing authorities. The only major exception, the application of the California sales tax to construction goods purchased in California for subsequent repackaging in California prior to shipment overseas, has been referred to the Department of Justice which will probably seek an exemption from the tax in the courts. Pah 22 om During the last three years, procedures were finally developed for handling lump- sum construction contracts where the contractors failed financially during the course of their work and defaulted on their contracts. Probably due to higher prices and scarcity of materials following and resulting fromthe outbreak of the Korean War, plus the unusual conditions created by the relative isolation of Los Alamos and other differences between Los Alamos and more normal cities, several contractors failed financially at Los Alamos during the height of the Los Alamos construction program. Problems related to having the jobs completed by others, what to do with earned and unearned money Aad " 12