MAINTENANCE AND OVERHAUL, PROPOSAL FOR REVISION OF RATES

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP89B00487R000400780041-2
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 11
• Document Creation Date: December 22, 2016
• Document Release Date: June 20, 2012
• Sequence Number: 41
• Publication Date: September 11, 1957
• Content Type: MEMO

Declassified in Part - Sanitized Copy Approved for Release 2012/06/20: CIA-RDP89B00487R000400780041-2
COPY / OF 2 -
11 September 1957
Subject: Maintenance and Overhaul, Proposal for Revision of Rates
Reference: (a) Contract BC-450, as amended
(b) Telecon 23 August 1957, WCM to GK
(c) Contract BC-200, as amended
(d) Purchase Order 56207
In accordance with Part V (a) "Repricing" of the Schedule of the reference (a)
contract we herewith submit our proposals for fixed hourly rates for the
periods 1 February 1957 thru 30 June 1957 and 1 July 1957 thru 31 January
1958. The activities this contract covers are the furnishing of services for
factory maintenance and overhaul of certain equipments, liaison with other
suppliers of related equipment and "in-plant engineering", all of which will
facilitate and support successful field operations.
Enclosure 1 presents the proposed fixed contract hourly rates for the period
1 February 1957 thru 30 June 1957. The revision of these rates has been
based on our analysis of actual costs incurred for the period.
The job classifications proposed for this period are unchanged from those
applicable for the period ending 31 January 1957. Fifteen of the grade rates
have been decreased in Total Price and one grade rate has been increased.
The overhead rate of_for the five-month period ending 30 June 1957 is
based on our analysis of the actual burden for this period.
The General and Administrative rate of[~ is based on our estimated
annualization of G & A for our present fixed year. Our actual experience
for the six-month period ending 31 July 1957 is
In accordance with Part V (a) of the reference (a) contract, the "Contract
Hourly Rates" for the period ending 31 January 1957 have applied as pro-
visional for the five-month period ending 30 June 1957. Sales invoices for
this period have been submitted to Customer A in the amount of $136, 523. 70
and to Customer B in the amount of $42, 838.22 for a total amount billed of
$179, 361.92.
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The proposed adjusted total amount for the five-month period ending
30 June 1957 for Customer A is $123, 200. 50. This revised amount
is based on the new rates as presented in Enclosure 1 and includes
the Direct Costs for this period with an applied G & A of=rather
than 7as previously invoiced.
The proposed adjusted amount for the five-month period ending
30 June 1957 for Customer B is $38, 572.20. This revised amount
is based on the new rates as presented in Enclosure 1 and includes
the Direct co t for this period with an applied G & A rate of~
rather than as previously invoiced.
It is recommended, based upon the proposed rates as presented in
Enclosure 1 that upon agreement and definitization of the contract that
we will submit a Credit Memo to correct the amount billed during this
period. Based on Enclosure 1, Credit Memos will be issued to you in
the amount of $13, 323. 20 for Customer A and $4, 266. 02 for Customer B.
Enclosure 2 presents the proposed fixed contract hourly rates for the
period 1 July 1957 thru 31 January 1958. We established these rates
by a comprehensive cost analysis of each element from the inception of
this activity thru 30 June 1957 and for the month of July 1957.
The job classifications proposed for this period have been expanded in
quantity from those for the previous period. The addition of the twenty-
three (23) job classifications is recommended to cover new job classifica-
tions established by the company since 31 January 1957 and to cover
those classifications of direct labor which will be contributing to the
maintenance and overhaul activity and have not heretofore been listed.
The following job classifications have been included in the schedule of
Enclosure 2:
074 Project Engineer, Senior
164 Technical Editor, Writer Specialist
070 Administrative Assistant, Senior
168 Publication Specialist, Senior
047 Administrative Assistant
169 Publication Specialist
5 846 Experimental Machinist, Leadman
585 Industrial Artist
545 Research & Development Aide
25X1
2bAl
25X1
2bAii
-2-
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 Declassified in Part - Sanitized Copy Approved for Release 2012/06/20: CIA-RDP89B00487R000400780041-2
Grade Job Code Job Classification
6 540 Technical Writer
8 255 Duplicating Machine Operator, Senir
530 Technical Clerk
9 260 Duplicating Machine Operator
10 590 Clerk-Typist
11 055 Administrative Assistant, Junior
167 Technical Writer, Junior
171 Publication Specialist, Junior
720 Model Maker
811 Machinist, Maintenance Leadman
991 Welder, Combination, Leadman
745
810
Plater
Machinist, Maintenance
Maintenance, Mechanic
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 Declassified in Part - Sanitized Copy Approved for Release 2012/06/20: CIA-RDP89B00487R000400780041-2
It is anticipated that the Maintenance and Overhaul program will increase
slightly in its activity from that of the previous period because basic
equipments which were delivered for operational use since January 1957
are now beginning to rotate through Maintenance and Overhaul. Equipments
delivered during the last four months will probably be rotated through
Maintenance and Overhaul at least once before January 1.958. All equip-
ments assigned to Detachment A will be returned during November to
Maintenance and Overhaul for inspection and repair before reassignment.
Pursuant to instruction of the Contracting Officer per reference (b), in
addition to repair and inspection work of equipments rotating through for
normal Maintenance and Overhaul, the assembly and installation of the
Configuration C optics and the final system test for serial numbers 1, 3,
4, 5 and 6 will be performed on this contract.
The basic hourly rates as presented in Enclosure 2 are based on our analysis
of the wages of employees directly engaged in the performance of work under
this contract through 30 June 1957 and further based on our best estimate of
the actual rate structures for the seven-month period ending 31 January 1958
including a 4% General Wage Increase for all Hycon hourly employees
effective 12 December 1957.
We, therefore, request that the reference (a) contract be amended to include
Enclosure 1 to apply as the fixed contract hourly rates for the period
1 February 1957 thru 30 June 1957 plus applicable direct costs in the amount
of $161, 772.70.
It is further requested that the reference (a) contract be amended to include
Enclosure 2 to apply as the fixed contract hourly rates for the period
1 July 1957 thru 31 January 1958, plus applicable direct costs.
It is recommended that all other terms and conditions of Contract BC-450,
as amended, shall remain the same except for Part V, Repricing, of the
Schedule. It is recommended that Part V not apply to the contract periods
1 February 1957 thru 30 June 1957 and 1 July 1957 thru 31 January 1958
because the rates for these periods are herewith proposed as fixed for
these periods and therefore would not thereafter be subject to revision.
Based on recent information pertaining to operational activity and test site
activity we submit our estimate of the level of sales for both customers in
the Maintenance and Overhaul activity for the period 1 July 1957 thru
31 January 1958:
-4-
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 Declassified in Part - Sanitized Copy Approved for Release 2012/06/20: CIA-RDP89B00487R000400780041-2
July
$ 28,864
$ 13,
551
$ 42,415
August
27, 000
11,
000
38, 000
September
30, 000
15,
000
45, 000
October
30, 000
15,
000
45, 000
November
30, 000
20,
000
50, 000
December
35, 000
20,
000
55, 000
January 1958
35, 000
25,
000
60, 000
Totals
$215,864
$119,
531
$335,415
The above schedule of estimated sales supersedes prev:_ous forecasts. These
sales figures are based on the rates presented in Enclosure 2.
It is recommended that, upon agreement and definitizati.on of this contract,
we will submit Credit Memos, based upon the proposed rates as presented
in Enclosure 2, to correct Invoice #PE 15184 for July 1957 to Customer A
in the amount of $767.86 and to correct Invoice #PE 15185 for July 1957 to
Customer B in the amount of $607.59 for a total of $1, 375. 45. These
invoices were submitted pursuant to the instructions of the Contracting
Officer as provisional billings pending definitization of this contract.
We trust that this proposal meets with your favorable consideration.
Very truly yours,
HYCON MFG. COMPANY
anage
r, 25X1
Engineering Products Division
TLB /pe
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 Xi" 1"? SA `1 t
1 Feb '(iary 1957 thru 30 June 1957 E osu
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23 August 1957
Grade
Job
Code
Job Classification
Hourly
Basic Rate
Burden
at 121%
Cost
G & A
at 12%
Total
Cost
Profit
at 10%
Total
Price
1
075
Project Engineer
$ 5. 25
6. 35
11. 60
1. 39
12. 99
1. 30
14.29
110
Research Engineer
2
064
Engineer, Senior
4. 35
5. 26
9, 61
1. 15
10. 76
1.08
11.84
165
Technical Writer, Sr.
3
065
Engineer, Intermediate
3.85
4.66
8.51
1.02
9.53
.95
10.48
100
Chief Inspector
146
Photographer, Senior
166
Technical Writer
4
066
Engineer Junior
3. 25
3. 93
7.18
. 86
6.04
. 80
8. 84
147
Photographer
295
Draftsman, Design
3. 05
3. 69
6. 74
. 81
7.55
. 76
8. 31
O ? r l._ A -1 C
JV J Lli ~'111 (71 -AL; !11'..10", /1 .
310 Draftsman, Layout
330 Technical Illustrator
340 Electronic Technician, Sr.
355 Photographic Technician, Sr.
7 300 Engineering Aide 2. 23 2. 70 4.93 . 59 5.52 . 55 6.07
345 Electronic Technician
360 Photographic Technician
500 Draftsman, Detail
535 Technical Illustrator, Jr.
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MAINTENANCE AND OVERHAUL
 Declassified in Part - Sanitized Copy Approved for Release 2012/06/20: CIA-RDP89B00487R000400780041-2
Job Hourly Burden U & A Total Profit Total
Grade- Code Job Classification Basic Rate at 121% t'st at 12% Cost at 10% Price
305 Engineering Aide, Jr_ $ 1, 85 2. 24 4.09 49 4. 58 . 46 5.04
315 Draftsman, Jr.
350 Electronic Technician, Jr.
365 Photo Technician, Jr.
515 Clerk-Department
520 Technical Typist 1. 60 1. 94 3.54_ .42 3. 96 . 40 4. 36
380 Clerk-General
10 320 Tracer 1. 50 1. 82 3, 32 .40 3. 72 . 37 4.09
11 845 Experimental Machinist 2. 80 3. 39 6. 1#- 74 6.93 . 69 7. 62
960 Tool & Die Maker
850 Research Mechanic
12 730 Grinder, Precision
770 Inspector, Precision
830 Machinist, Precision
935 Inspector, Electronics Systems
990 Welder, Combination
2.60 3.15 5.75 .69 6.44 .64 7.08
13 705 Assembler, Precision 2. 15 2. 60 4.75 5 7 5. 32 . 53 5. u5
785 Inspector, Machined Parts
805 Vatman, Plating
840 Machinist, Specialist
920 Inspector, Electronics, Sr.
975 Spray Painter, Specialist
995 Welder, Specialist
14 755 Inspector, Assembly & Test 1. 80 2. 18 3. 98 48 4.46 . 45 4. 91
820 Machine Operator
890 Spray Painter
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 ~'*~c141it~r6 ~
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.Job
Hourly
Bur den
G & A
Total
Profit
T.taf
Grade
Code
Job Classification
Basic Rate
at 121%
Cost
at 1Z%
Cost
at 10%
Price
14
925
Inspector, Electronics
$ 1.80
Z. 18
3. 98
.48
4.46
.45
4.91
(cont'd)
970
Vat Tender
965
Truck Driver
15
700
Assembler, General
1.70
2.06
3.76
.45
4.21
.42
4.63
760
Inspector
950
Helper
16
765
Inspector, Jr.
1.50
1.82
3.32
.40
3.72
.37
4.09
915
Assembler, Electrical
930
Assembler, Mechanical
940
Utility Worker
Travel and Subsistence - Expenditures by the Contractor for the transportation of the persons directly
engaged in the performance of the work hereunder and reasonable actual subsistence expenses incurred
during periods of travel in accordance with Contractor's established travel practices will be allowable direct
costs under this contract to which General and Administrative expense at 12% will be added as part of
approved costs.
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 Declassified in Part - Sanitized Copy Approved for Release 2012/06/20: CIA-RDP89B00487R000400780041-2 =nclosure 2
my 1957 thru 31 January 1958 22 August
MAINTENANCE AND OVERHAUL
PROPOSED TIME AND MATERIAL RATES
Hourly
Burden
G & A
Total
Grade Code
Job Classification
Basic Rate
at 130%
Cost
at 12%
Cost
1
074
Project Engineer, Senior
5. 50
7. 15
12.65
1.52
14. 17
075
Project Engineer
110
Research Engineer
164
Tech. Writer, Writer Spec.
2
064
Engineer, Senior
4.45
5. 79
10.24
1.23
1 1.47
165
Tech. Writer, Senior
070
Administrative Asst. Sr.
168
Publication Specialist, Sr.
3
065
Engineer, Intermediate
3.85
5.01
8.86
1.06
9.92
100
Chief Inspector
146
Photographer, Senior
166
Technical Writer
047
Administrative Assistant
169
Publication Specialist
4
066
Engineer, Junior
3.25
4.23
7. 48
. `1U
147
Photographer
295
Draftsman, Design
3. 15
4. 10
7.25
.87
346
Exp. Mach., Leadrrian
585
Industrial Artist
545
Research & Dev. Aide
6
303
Engineering Aide, Sr.
2.80
3.64
?. 44
310
Draftsman, Layout
330
Technical Illustrator
340
Electronic Technician, Sr.
355
Photographic Tech., Sr.
540
Technical Writer
Profit
at 10%
Tota 1
Price
1.42
15.59
1. 15
12.62
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 y __~ Errclosu~e'2
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Job L(xrly Burden L A Total Profit Total
Grade Code Job Classification Basic Rate at 130% Cost at 12% Cost at 10% Price
300 Engineering Aide 2.35 3.06 5.41 .65 6.06 .61 6.67
345 Electronic Technician
360 Photographic Technician
500 Draftsman, Detail
535 Technical Illustrator, Jr.
8 305 Engin eering Aide, Jr. 2.00 2.60 4.60 .55 5.15 . 52 5.67
315 Draftsman, Junior
350 Electronic Technician, Jr.
365 Photo Technician, Jr.
515 Department Clerk
255 Duplicating Mach. Opr. Sr.
530 Clerk, Technical
9 520 Typist, Technic&l 1.70 2.21 3.91 .47 4.38 .44 4.82
380 Clerk, General
Z60 Duplicating Mach. Opr.
10 590 Clerk, Typist 1.60 2.08 3.68 .44 4.12 .41 4.53
320 Tracer
11 720 Model Maker . 2.90 3.77 6.67 .80 7.47 .75 8.22
991 Welder, Combination, Ldman
845 Experimental Machinist
850 Research Mechanic
055 Administrative Asst., Jr.
171 Publications Specialist, Jr.
811 Machinist, Mairfenance, Ldmn.
167 Technical Writer, Junior
12 730 Grinder, Precision 2.65 3.45 6.10 .73 6.83 .68 7.51
770 Inspector, Precision
830 Machinist, Precision
935 Inspector, Elect. Systems
990 Welder, Combination (Prec.)
810 Machinist, Maintenance
745 Plater
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(( Enclosure
Job i,.durly Burden br& A Total Profit Total
Grade Code Job Classification Basic Rate at 130% Cost at 12%6 Cost at 10% Price
13 705 Assembler, Precision 2.25 2.93 5.18 .62 5.80 .58 6.38
785 Inspector, Machined Parts
805 Vatrnan, Plating
840 Machinist, Specialist
920 Inspector, Electronics, Sr.
975 Spray Painter, Specialist
995 Welder, Specialist
875 Maintenance Mechanic
14 755 Insp., Assy & Test 1.95 2.54 4.49 .54 5.03 .50 5.53
820 Machine Operator
890 Painter, Spray
925 Inspector, Electronics
970 Vat Tender
965 Truck Driver
15 700 Assembler, General 1.80 2.34 4.14 .50 4.64 .46 5.10
760 Inspector
950 Helper
16 765 Inspector, Jr. 1.60 2.08 3.68 .44 4.12 .41 4.53
915 Assembler, Electrical
930 Assembler, Mechanical
940 Utility Worker
Travel and Subsistence - Expenditures by the Contractor for the transportation of the persons directly
engaged in the performance of the work hereunder and reasonable actual subsistence expenses incurred
during periods of travel in accordance with Contractor's established travel practices will be allowable
direct costs under this contract to which General and Administrative expense at 12% will be added as
part of approved costs.
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