AEDC at 75: ARO lands first AEDC contract

BRAD HICKS AEDC Contributor Air Force officials determined in 1950 that the retention of expertise and test facility familiarity at its new Arnold Engineering Development Center would be better achieved through a contractor workforce operating the Center. As was the case 75 years ago, the majority of the AEDC workforce is currently comprised of contractor personnel. Today, these contractors are spread across multiple contracts awarded to different companies for various functions, such as test operations, fire protection and information technology. Arnold Research Organization Inc. was the first company awarded a contract to maintain and operate AEDC. ARO was awarded its first contract from the Air Force on June 29, 1950, to operate AEDC for 15 months. The contract was signed in the amount of $694,174.50 and was a cost-plus-fixed-fee contract. According to the Federal Acquisition Regulation website, this type of contract is a cost-reimbursement contract that “provides for payment to the contractor of a negotiated fee that is fixed at the inception of the contract.” “The fixed fee does not vary with actual cost, but may be adjusted as a result of changes in the works to be performed under the contract,” the website states. “This contract type permits contracting for efforts that might otherwise present too great a risk to contractors, but it provides the contractor only a minimum incentive to control costs.” The process of extending the contract to ARO began some months before the agreement was signed. As AEDC was being planned in 1949 and constructed in 1950, two separate groups studied the needs of the Air Force for research, development and testing, and possible methods of operation for AEDC. An effort led by physicist Louis Ridenour resulted in a report titled “R&D in the USAF.” This report, prepared in 1949, emphasized the need for facilities like those later constructed at AEDC. “The report further cited the need to go outside the Air Force for the personnel with the technical expertise needed to operate the facility since the Air Force lacked a sufficient number of military or civilian people with this expertise,” Beyond the Speed of Sound, a book detailing the history of AEDC, states. The second report, titled “Special Committee on AEDC Operation,” was prepared in 1950 by the Markham Committee, an offshoot of the U.S. Air Force Scientific Advisory Board chaired by Professor John Markham of Massachusetts Institute of Technology. This report recommended that AEDC be operated by a non-profit corporation. “Noting that AEDC facilities would be made available to industry for test, would test items developed for the services and would perform internal research and development work, the committee suggested that the non-profit entity be sponsored by a parent organization which would preferably be a large industrial corporation with a variety of technical interests,” Beyond the Speed of Sound states. “After considering these reports and other information available to him at the time, W. Stuart Symington, the Secretary of the Air Force, decided that the Air Force would be best served by contracting with a for-profit corporation to operate the facilities, recognizing the value of the profit motive.” On March 29, 1950, Symington directed that AEDC be operated by a corporation under contract to the Air Force. Several meetings between the Air Force and Sverdrup & Parcel personnel occurred the following month. Their discussions led to the establishment of ARO. ARO, a Tennessee corporation, was a subsidiary of Sverdrup & Parcel, a St. Louis-based engineering firm. On July 19, 1950, the Department of Defense Office of Public Information issued a release detailing the establishment of ARO. In it, the DOD stated the new corporation was established so that a separate corporate structure would be available for the purpose of managing and operating AEDC as a contractor operation under the direction of the Air Force. “The new organization, known as ‘ARO, Incorporated,’ is a Tennessee corporation and was established in order to continue to utilize the technical background of the Sverdrup and Parcel organization and at the same time to have an organization whose sole interest, activity, and responsibility would be the management and operation of AEDC,” the release states. “The corporation will assume charge of the management and operation of the large scale test facilities at the Tennessee location and will perform development and evaluation testing on aeronautical engineering projects requested by industry and governmental agencies. “ARO’s organization and relationship to the Air Force, in general, will be similar to the Atomic Energy Commission’s contractual relationship with private corporations for the operation of its facilities, and to the U.S. Navy’s contractual relationship to certain corporations in the operation of Navy test facilities. “The Air Engineering Development Division, under the command of Major General F.O. Carroll, is the Air Force agency which has overall command jurisdiction over the test center. Under present plans, the Air Force will schedule the testing programs for the AEDC and the contractor will perform the tests.” Sverdrup & Parcel was already quite familiar with AEDC prior to this. In 1946, Sverdrup & Parcel was presented with the possibility of designing a complex of wind tunnels and other testing facilities for the military. Several years later, those designs would be used in the construction of AEDC. Also in 1946, the firm was awarded an Army Air Forces contract to study potential sites for the then-planned aeronautical research and development hub that would soon become the Air Engineering Development Center and later Arnold Engineering Development Center. Among the recommendations offered by the firm was the Tennessee Valley. The state of Tennessee offered to donate Camp Forrest, an Army training base during World War II located near Tullahoma, as the site for the new center. In April 1948, Camp Forrest was named as the site for the Air Force’s new Air Engineering Development Center. Sverdrup & Parcel was later called upon to analyze the then-proposed Elk River Dam. After then-President Harry Truman in October 1949 signed the Unitary Wind Tunnel Act and the Air Engineering Development Center Act of 1949, the way was cleared for work to begin on building AEDC. The Army Corps of Engineers was tasked with overseeing part of the AEDC design and its construction. The Tullahoma District of the Army Corps of Engineers was established in November 1949 for this purpose. It was determined that a tremendous amount of cooling water would be required for test operations at AEDC and that a reservoir to provide it could be created by damming the Elk River near the Center. In January 1950, the first construction directive for the AEDC was issued by the Headquarters of the Air Force to the Army Corps of Engineers chief of engineers. It covered preliminary investigation and design of the dam and preliminaries to land acquisition, as well as administrative expenses for the recently established Tullahoma District. Several sites along the Elk River were studied for the site of the dam and, prior to the official selection of the dam location, Sverdrup & Parcel was brought in to study the matter. The firm issued a report on the requirements for the reservoir, later referred to as Woods Reservoir, and recommended that the reservoir design criteria be determined by the Army Corps of Engineers. “It was important that conflicts of interest be avoided, so contractual language was developed to preclude operation by firms involved in the manufacture of hardware amenable to testing at AEDC,” Beyond the Speed of Sound states. “Since S&P was not an aerospace hardware manufacturer, and ARO, Inc., had no business outside AEDC, conflicts of interest were avoided.” In a 1961 presentation, ARO President Leif Sverdrup reflected on the establishment of ARO and the potential impact its work at AEDC could have on Air Force research and development. “The Markham Committee of the Scientific Advisory Board recognized that the normal Air Force and Civil Service regulations, which must cover broad organizations, do not lend themselves, in general, to the flexibility and responsiveness to new circumstances which are required in an R&D organization dealing with rapidly changing products,” Sverdrup said. “Regulations which are sound when applied to a stabilized situation may often by totally unsuited to an evolutionary activity. For this reason, suggestions were made that the maximum flexibility should be incorporated in the operating plan for these large facilities. This meant that Air Force regulations, which are applicable to an Air Force base, whether it be in Texas, Spain or Greenland, are not sufficiently adaptable for use where new product development is the goal. Accordingly, the decision was made to place the operation of the facilities in the hands of a private contractor who would be guided by, but not restricted to, the standard Air Force regulations. ARO, then, is an experiment in management and I believe that this experiment may have as great importance to the Air Force R&D program as the actual work of the facilities.” In that same presentation, Sverdrup stated the first ARO employee was hired in May 1950. ARO was awarded a series contracts on a sole source basis through the 1977 fiscal year. In 1970, however, Air Force Assistant Secretary Philip Whitaker published a memorandum directing the Air Force to explore the possibilities of competing several large operating contracts which had been awarded only on a sole source basis for many years. The AEDC contract was included in this memorandum. As a result, the AEDC contract was the subject of a formal competitive source selection beginning with fiscal year 1978. ARO submitted the winning offer. ARO served as the contractor at AEDC through 1981. In 1979, AEDC leadership broke the Center Statement of Work into three separate packages. One of those packages was awarded to Sverdrup Technology, Inc., formerly known as ARO, in 1981. Sverdrup would continue to hold a contract at AEDC through June 2003. This is the ninth in a series of articles highlighting the history of Arnold Engineering Development Complex during its first 75 years. Additional articles will be published throughout 2026 to commemorate the anniversary of AEDC. All photos are courtesy of the U.S. Air Force.
BRAD HICKS AEDC Contributor Air Force officials determined in 1950 that the retention of expertise and test facility familiarity at its new Arnold Engineering Development…
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