Alaska Native Corporations' contracting status under fire again

Four ANCs among the top 100 recipients of contract awards

Sen. Claire McCaskill will work again this year to end Alaska Native Corporations’ special contracting status.

The Missouri Democrat introduced S. 236 on Jan. 31, which would eliminate the preferences and special rules under the Small Business Administration’s 8(a) Business Development program for ANCs, which are partially owned by tribal people in Alaska.

She proposed the legislation in November at the end of that Congress, as did Rep. Bennie Thompson (D-Miss.), who was chairman of the House Homeland Security Committee at the time.

McCaskill, chairwoman of the Homeland Security and Governmental Affair’s Contracting Oversight Subcommittee, held a hearing in 2009 that delved into the ANC issue and questioned whether the ANCs should get the special small-business set-aside category.

Under the current rules, agencies can limit competition for a contract to only ANCs, and even award a sole-source contract to an ANC. In addition, the companies do not have to be certified small businesses to get the contracts, even though the special rules fall under a small business development program.

McCaskill's investigative report on ANCs among other things found ANCs’ share of government contracts has grown six times the rate of overall federal spending since 2000.

Also four ANCs were among the top 100 recipients of contract awards, and in 2009 six companies made Washington Technology’s Top 100 list of IT contractors.

The debate over the unique treatment of ANCs heats up both sides of the issue—the Alaskans and other small business owners who are under the more restrictive regulations.

During the 2009 hearing, Sarah Lukin, executive director of the Native American Contractors Association, said 11 large ANCs provided more than $530 million to more than 67,000 shareholders in fiscal 2008 and 2009. The point of ANCs’ status is to help the tribes in the northernmost state, which is economically depressed.

However, business owners say the ANC status is a boondoggle and obstructs other small businesses from opportunities to succeed in the federal marketplace. They don’t have a chance to compete against an ANC or protest an award.

For now though, McCaskill’s bill has gone to the Small Business and Entrepreneurship Committee for further consideration.

About the Author

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

Reader Comments

Tue, Mar 19, 2013 Caroline Moore

Has anyone heard this issue more extensively? I feel this article doesn't quite serve justice about the http://www.bbnc.net/ DOT .

Tue, Jul 26, 2011

Here is the deal folks......You cant be mad a somebody wanting to make a buck....our government has aloud this to happen and is now trying to bring them back to the same playing field and is getting a lot of resistance from the Alaskans. We would agree that this right the Alaskans have is unfair but we cant go after them. The American government has to make these changes and take the blame for this. We voted these people in so we most request that these same people be held responsible for the lop sided rights to these government contracts. In a nut shell there was a handshake between the Alaskans and the lower 48 states that agreed to allow the government to install the oil pipe line threw alaska in agreement they get special privliges to be a sole sourch contractor for government contracts. Shame on congress they let this happen. Not until recent years have the alaskans became wise to how this systems works and has only taken advantage of the situation. McCaskill has recognized this and hopefully she can get the support to stop this unfairness. As for now the ANC'S will continue to become millionaires while the rest of us continue the good fight to support our families. Though dont have the education or training to truley make a differnce as you can see by my misspelled words and poor grammer but its is easy to see that this is not fair at all. ANC is very clever that they hire former military personnell to run these contractt because they personally dont know how themselves so I say shame on you former military guys for working for them but at the same time good for you because you have a job and you can support your family. We can complain until we are blue in the face folks but the reality is that nothing is going to change, by the time our government sorts this all out the ANC'S will have already made enough money that it really wont make a difference. this is a classic case of "FREAKANOMICS" Get over it and move on with your own lives and try to get the biggest piece of the pie that you can because we cant un-ring a bell once its been run

Mon, Jul 25, 2011

Totally Support Senator McCaskill's effort and agree it overdue. I watch first hand the illegal activities of ANC's on a daily basis.

Fri, Jul 1, 2011 Wendell Colorado

As a 3rd generation Alaskan who does not get any of the benefits of being a Native Alaskan it really rubs me raw when I drive onto a military facility and see security teams run by an ANC or do my IT consulting job and encounter people that essentially work for a small island native group in Alaska. As a kid growing up in AK and working really hard in a family business we saw many situations where we had to pay for licenses or permits to function and the Native Assoc's didn't have to. These benefits related to fishing and subsistence in local areas make sense. But this makes no sense with regards to securing a military base in Georgia or Florida. The ANC groups should have to compete on a level playing field for these jobs. In many ways we are enabling them to be lazy and take advantage of the system.

Thu, Apr 7, 2011

Interesting read on an example of abuse: http://www.sba.gov/sites/default/files/oig_report_10-11.pdf http://www.govexec.com/dailyfed/0521/052110rb1.htm

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