Economic Development by Act of Congress

Back in the late 1980s, say between 1987 and 1989, Ohio Business magazine published a cover story on Wright Patterson/

Entitled “Does Wright Patterson Need a Boost”, it was an in-depth look at activities on base and the local economic impact.

The article quotes the commander of the old Air Force Logistics Command, Gen. Hansen, on the growth in IT work at the base:

The greatest potential for new jobs is in the computer arena, particularly in software
development and engineering. "Our Logistics Management Systems modernization
program has already provided a strong boost to the local economy," says Hansen,
because contractors are required to locate a facility within 20 miles of the base.

Logistics system modernization contracts have totaled more than $333 million since
1985. About 50 contractors are working on the AFLC's modernization program,
employing about 4,000, and generating about $80 million annually in payrolls for the
Miami Valley.

Note the remark about the 20 mile radius. I recall this wasn’t policy, but statutory, mandated via an act of Congress. This law drove a growth in defense contractors in the area. Some probably maintained smallish storefront operations, with most work done outside the region, but others perhaps required a larger workforce in the area.

The cumulative effect was great, as noted by Gen. Hanson, and he was just talking about his unit, not the R&D mission. At a large base like Wright-Patterson, with a mix of different units, the 20 mile rule could really lead to a local boom in defense contracting.


Unlike the T2 example below, there were spin-off situations. Separated civilian and retired military techies could set up consultancies, picking up subcontracting work, or working directly with the base.

The same could happen with contractor staff, which could go out on their own, forming their own consultancies and firms. And new locally-based entrants could go after the defense work.


Also, policy shifts within the military toward private sector models of corporate structure led to more outsourcing, which increased work available for contract.

The net result was the formation of a defense tech cluster, a mix of outside and local contractors. But all this business formation and clustering would still be dependent on (and limited by) the defense budget, assuming that the contractor community didn’t try for substantial amounts of work in the civilian sector.

Is this cluster moving beyond defense work, competing in the private sector?

That is the big economic development question.