Coalition stumps for Alaska Native set-asides as hearing looms

Senate subcomittee to examine alleged abuses of ANC program

A coalition of Native American organizations took to Capitol Hill on Monday, talking up the benefits of set-aside contracts for Alaska Native Corporations, just days before a Senate subcommittee holds a hearing to discuss abuses of the policy.

Native8(a)works, a group of tribes, organizations and businesses, launched its effort to tell Congress about what the Small Business Administration’s 8(a) Business Development Program does for the United States’ indigenous people and why the program should not be changed.

The coalition wants to give lawmakers its perspective by reminding them that the program works as an economic community developer. And there is no other federal program like it.

“We stand united in opposition to any effort to change one of the only programs with the federal government that encourages tribal and community corporation inclusion in business and commerce in this country,” said Tex Hall, chairman of the Inter Tribal Economic Alliance and a tribal member from North Dakota.

Under the ANC program, agencies can award contracts of any size to Alaska Native-owned company without competition. Other set-aside contracts have dollar thresholds.

Some lawmakers are concerned that agencies have used the set-asides to avoid competition for contracts, and the corporations getting that federal work are large, non-Native contractors.

The Senate Homeland Security and Governmental Affairs Committee’s ad hoc Contracting Oversight Subcommittee has scheduled a hearing on July 16 to examine potential abuses in awarding and managing these contract vehicles.

According to a 2007 Government Accountability Office, obligations for 8(a) contracts to ANC firms increased from $265 million in fiscal 2000 to $1.1 billion in 2004. Over those five years, agencies sent $4.6 billion to ANC firms, and 63 percent, or $2.9 billion, went through the program.

Sole-source contracts to ANC firms from six agencies alone increased from about $180 million in fiscal 2000 to about $876 million in fiscal 2004, GAO also found.

But coalition members say lawmakers do not have an accurate picture, which is why they undertook the marketing blitz. “We cannot sit passively by while some in Congress misrepresent Native participation in the 8(a) program,” Hall said.

Native-owned businesses in SBA’s program provide a lot for the Native American community, according to the coalition. Unlike other 8(a) businesses that support one or two private owners, coalition members say Native-owned companies support entire communities. As examples, it points to more 31,000 jobs, millions of dollars in their economies and an increasing number of college-bound Native Americans.

Native8(a)works says the program is starting to produce those results, but the government needs to do more work to support Native Americans. Poverty and unemployment rates among Native Americans are nearly double the national average. The coalition also says the incomes of Alaskan natives are roughly half of those of other Alaskans.

In the federal information technology market, six ANCs ranked on Washington Technology’s 2009 Top 100 list of IT contractors, with one being in the top 50. NANA Regional Corp., at No. 47, nearly doubled its contracting dollars, from $214.8 million in 2007 to $427.6 million in 2008. Also among the 100:

  • Arctic Slope Regional Corp. was No. 58, with $319.1 million in 2008.
  • Chenega Corp. was No. 61, with $305.5 million.
  • Eyak Technology LLC was No. 65, with $281.5 million.
  • Chugach Alaska Corp. was No. 74, with $218.6 million.
  • Alutiiq LLC was No. 91, with $171.1 million.

NANA and Chenega are members of the Native8(a)works.

ANCs were created to settle land claims with Alaska Natives and foster economic development. In 1986, Congress passed legislation that allowed ANCs to participate in the 8(a) program. The program created to help small disadvantaged businesses compete in the market place.

Since then, Congress has extended special procurement advantages to 8(a) ANCs, such as the ability to receive sole-source contracts for any dollar amount and to own multiple subsidiaries in the 8(a) program.

About the Author

Matthew Weigelt is a freelance journalist who writes about acquisition and procurement.

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