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The proposed contract is also one for development and testing. Use of a cost-incentive fee contract is not practical, since one cannot reasonably estimate a relationship between allowable costs and target costs. 
However, as operations of the STOL aircraft will give rise to revenues, estimated at about $750,000 over the 40-month period, it is suggested that such revenues be credited against the total contract amount of the basis of a sharing formula to be established during contract negotiations. In this way, New York Airways, as prime contractor, could be given an incentive towards reducing the ultimate cost to the Government. Any amounts recoverable by New York Airways through the receipt of its share of such revenues could also be made subject to a limitation similar to that provided for cost-plus-a-fixed fee contracts. Thus, New York Airways is requesting no fee other than what might accrue from its share of revenues, and is further proposing to limit its contingent return through such revenues to the equivalent of a fixed fee.

Advisers

At the outset, immediately following execution of the basic contract, we would expect to establish an advisory committee consisting of representatives of the trunk and local service airline industry. Their advice

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