In the 1970s, Congress became concerned about the perceived abuse of assistance agreements by using aid agreements to circumvent competition and contracting rules. To address these issues and ensure consistency in agency practices, Congress passed the Federal Grant and Cooperative Agreement Act of 1977 (FGCAA). The FGCAA sets government-wide criteria for determining the appropriate legal instrument for funding extra-governmental activities. Burgos and Bloomsbury did not undertake an initial analysis of the promotion authority, which differs from that of the grant and Cooperative Agreement Act`s financial authority, for the use of a grant instrument. In the first case, Burgos, Executive Order No. 11625, October 13, 1971, with which OMBE, the granting agency, was created, speaks clearly of the power to support public and private organizations so that they in turn can provide technical and management assistance to minority companies. In the law on appropriation, pub. L. 95-431, 92 Stat. 1032, it is specifically stated that the funds provided are available for grants. However, the decision was not justified for the reasons outlined above, but because the decision to move to a subsidy mechanism had been approved by the FGCA. In this legal context, it is possible to summarize the intention of Congress as follows: if the law is interpreted as authorizing agencies to use subsidies or cooperation agreements for the acquisition of drugs, which are in turn made available to a fellow, Section 4, paragraph 2, should be interpreted as an expression of Congress` intention that such agreements be contracts. After such an interpretation, paragraph 4, paragraph 2, acts as a second line of defence.
Therefore, when the main authority of Section 4, paragraph 1, is read to cover the first part of a two-tiered transaction, Congress` intention is satisfied without resorting to the whims of Section 4, paragraph 2. We see no reason to advance the language in a commission report which, if read in isolation, seems to require an abnormal result when the language of the act can be read to fulfil the fundamental intent of the statute. There hardly seems to be any difference between the two-step situation described in the commission`s report, in which the government buys drugs to give fellows, and a situation where it pays a pharmaceutical company instead to supply the drug to the fellows.