The Marine Corps planners were also concerned that an attempt should be made to increase the number of total aircraft allowed in Marine aviation so that no cut-back in current fixed-wing aircraft would result from this program . However, it was agreed by Generals Wallace and Pollock
"that if the numerical ceiling for Marine Corps aircraft could not be increased, they would accept a reduction in other type aircraft in order to have sufficient aircraft billets to provide for the two assault helicopter squadrons . "
Nine days after the conference, General Cates signed a letter addressed to the CNO outlining the two-step helicopter program as proposed by General Wallace. Admiral Sherman was advise d that the delay involved in research and development for the XHR2S–1, while unavoidable, would prevent the delivery of an operational helicopter for about five years . The Commandant explained that it was necessary to provide
"both Fleet Marine Forces with the means for training combat units in assault helicopter operations,"
and also necessary to provide the helicopters in order to
"in - crease the combat readiness of the Marine Corps . "
The letter continued :
"implementation of this program is considered to be of vital importance, "
and even though the
"Army and Air Force are to be invited to join in the support of this project [XHR2S–1] . . . with or without their assistance, it is necessary to proceed concurrently with the procurement of the interim model ." 
During June, the CNO replied to the Commandant's letter and in essence gave the Marine Corps a substantial sense of satisfaction. The response, originated by Vice Admiral John H. Cassady, DCNO (Air), outlined a specific program similar to the one suggested by General Cates. Cassady's letter specified that priority of AO–17501 would be evaluated by a special review board (within CNO offices) in relation to all existing priorities. Also, if agreement could be reached with the Air Force to discontinue support of the XH–16 project, the $200,000 remaining in the Fiscal Year 1951 funds would be applied to AO–17501 and design competition would be initiated for the XHR2S–1.
It was reiterated that it would take five years before a production helicopter could be produced which would meet the requirements of AO–17501 . Admiral Cassady stated that agreement had bee n reached within his offices to investigate the possibility of procuring an interim helicopter as requested by the Commandant, one which could be delivered in about 33 months. The Bureau o f Aeronautics had also agreed to survey industry for the most suitable helicopter which could he modified to obtain the closest approximation of the XHR2S–1, and to secure the necessary information so as to award a contract prior to September 1950—only three months away. Finally , Cassady mentioned that the CNO had approved an aviation plan authorizing the two 15-plan e squadrons with HMX–1 being redesignated as one of the future operational squadrons.
.CNO Br to CMC dtd Jun50, subj : Operational Requirements No.AO-17501 .
This re-designation of HMX—1 did not set well with Marine Corps planners as they had hoped to retain the experimental squadron as well as gain the two proposed operational units . During the first half of 1950, visible progress had been made toward accelerating the helicopter program. Events during the following six months, however, not only saw the two-step plan implemented, but expanded to an extent far beyond all expectations.