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Telephone Conversation on January 1), 1953

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pave.__vanuary 1k, 1953

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Mr. Fred Hohner of AEC called from Albuquerque this date to discuss

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the basis for the fee negotiations to be held on January 22 and 23

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covering the new work at Bikini and Eriwetok.

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The estimated costa upon which the negotiations will be based will be
the costa agreed upon at our meeting held on December 30, 1952. Mr.

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Hohner agreed to this regardless of the fast that on Jamary 9, 1953

current cost estimates cased on approved drawings had been aubmitted

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for certain items of work at Bikini. There was not sufficient variation
between the figures established on December 30th and the current cost

estimates of Jamary 9th, therefore it was agread to use the December 30th
figures.
During the conversation we clarified the definition of Operational
Equipment. For example: Although East's current cost estimate of

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January 9th reflected approximately $45,500 for so-called Operational

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Equipment, much of it consisted of installed equipment such as ranges,

scullery sinks, etc.

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It was estimated that approximately $6,000 of

this total covered such items as dishes, utensils, chairs and dining
tables, etc, which constitute the true Operational Equipment.
The purpose of defining this Jperational Equipment, according to Hr. Hohner,

was because the AEC Fee Manual did not allow a construction fee for such

Operational Equipment.

In calculating our conatruction fse this mst be

taken into consideration for each item of the contract.

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REPOSITO

Holmes

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MATIONAL

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326 ATOMIC ENERGY Cone
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BOX No. (99629 (F608) AlO339 346-6

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Jo8 $84

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