Alaska Native contracting faces challenges

Monday, October 29, 2007  

The Alaska Federation of Natives convention ended on Saturday amid warnings about potentially negative changes in the government's billion-dollar minority contracting industry.

Alaska Native corporations have benefited greatly from government contracts. Taking advantage of their status as minority-owned businesses, they have received billions of dollars in work, according to Congressional investigators.

But some critics in Congress and others within the minority business community have challenged the success of the Native corporations and are pushing for changes in the Small Business Administration's minority contracting program. Yet speakers at AFN, which was held last week in Fairbanks, said the attacks were unfounded.

"There seems to be a perception that something's not right -- it's not right that Alaska Native corporations and tribes should be able to get big contracts when other people can't," said Bill Largent, a member of the Keweenaw Bay Indian of Michigan who is in charge of Native American programs for the SBA.

Largent was befuddled by the Government Accountability Office's recent investigation into Native contracting. "They didn't find any fault, they didn't find any wrongdoing, they didn't implicate anybody other than us -- that the [SBA] isn't doing enough to manage the program," he said on Thursday at the convention.

Nevertheless, the report and Congressional criticism have prompted the SBA to propose regulations to change the 8(a) program. Largent and other SBA officials held a consultation session in Fairbanks last Wednesday to hear from Alaska Native leaders.

"In Washington, the word on the street is that Alaska Natives are getting rich from easy access to federal contracts," said Largent, who emphasized that these comments were his personal views and not those of the Bush administration. "So what we're dealing with here as Native people is a perception problem."

"Remember, the GAO report didn't say what was wrong. It just kind of implied that something wasn't quite right and they've left us to figure out how to make what's not quite right, right, even though we don't know quite what's not right," he said.

Similar sentiments were expressed by members of Alaska's Congressional delegation. They have been responsible for ensuring that Alaska Native corporations benefit from government contracting.

"I have fought, and I will continue to do so, against those who are trying to take away from a successful program -- a program that's given the Native corporations and Native shareholders their just share of wealth in this country," Rep. Don Young (R-Alaska) said on Friday.

"It's been criticized as being a privilege or special benefit to Alaska Natives," he added. "And that is correct, as it should be."

Sen. Ted Stevens (R-Alaska), who wrote a provision in federal law that helps Alaska Native corporations, also called the SBA program a "great success story." He cited dividends paid to shareholders, scholarships for Native students, funding for cultural programs and infrastructure in remote villages.

"Sadly, special interest groups and some members of Congress seek to repeal the laws ... which were designed to improve economic opportunities for your corporations and tribal enterprises," said Stevens, who also spoke on Friday. "I think that's the most serious problem we face in the year ahead."

Jackie Johnson, the executive director of the National Congress of American Indians, urged Alaska Natives to stay united with tribes in the lower 48 states on the contracting issue. Although most of the Congressional criticism has focused on Alaska, tribes are beginning to face similar challenges.

"We''ll have ongoing consultation and that's a really important part of us getting our recommendations forward ... to make sure the administration knows what we need to do be able to keep those programs alive," said Johnson, who is Tlingit from Alaska.

Federal Register Notices:
8(a) Business Development Program Regulation Changes; Tribal Consultation (October 25, 2007)
8(a) Business Development Program Regulation Changes; Tribal Consultation (October 11, 2007)
Federal Acquisition Regulation; FAR Case 2004-017, Small Business Credit for Alaska Native Corporations and Indian Tribes (August 17, 2007)

Relevant Links:
Alaska Federation of Natives - http://www.nativefederation.org
Native American Contractors Association - http://www.nativeamericancontractors.org
Small Business Administration - http://www.sba.gov