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Mr. SANDWEG. We have one in a similar area that might even be answered in much the same manner, I suppose.

It also refers to an area that seems to have been available through the regular Government channels. That is a contract with one Franklin Leerburger-L-e-e-r-b-u-r-g-e-r-in the amount of $9,000. Description of the contract is as follows:

Engineering analysis and reports for evaluation and analysis of natural gas rates relating to possible conversion from coal, fuel, and propane. The results are reflected as a final report with recommendations as prepared by the contractor. These recommendations are being considered by the Government.

(The contract data not read is as follows:)

Contractor: Franklin J. Leerburger.

Value: $9,000.

Description: Engineering analysis and reports for evaluation and analysis of natural gas rates relating to possible conversion from coal, fuel oil, and propane.

Results: A final report with recommendations was prepared by the contractor. These recommendations are being considered by the Government. Mr. SANDWEG. Now who do we have to speak to that?

Secretary IMIRIE. Mr. Duncan, who is from the Directorate of Civil Engineering at the Air Force Systems Command Headquarters. Mr. SANDWEG. Mr. Duncan, could we have an explanation of the purpose of that contract, the reviewing authority on it, and was this the type of information that was available through Government sources, or other readily available sources?

Mr. DUNCAN. The gas company-the Elk River Public Utilities District submitted a proposal to the Arnold Engineering Development Center to supply gas for fuel.

Mr. NORBLAD. Where is this located, geographically?

Mr. DUNCAN. Tullahoma, Tenn.

Prior to the construction of the Arnold Engineering Development Center gas was considered as an auxiliary fuel, in order to have all types of fuel available in the case of any eventuality.

So the engineers at the Arnold Engineering Development Center made an economic and feasibility study of this conversion. That was submitted to Air Force. And they decided they wanted an outside, third party, survey of these particular rates. Because it involved in the first instance, there is a little history concerning the Elk River Public Utilities District.

They originally were the Tennessee Natural Gas Distribution System, who were supplied by the Tennessee Transmission UnitCorporation.

So the funding operation-there was a tremendous connection charge in connection with this, and the funding operation required Air Force money to meet this obligation. Of course it would be paid off in a period of 10 or 15 years.

So this all had to be evaluated—their books, their financial setup and everything else.

So the Air Force directed that we have a third party survey. And negotiations were made with three other architect engineers. And their prices were so outlandishly high-they only authorized $9,750 for this project; that is, the AFSC authorized this.

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