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Native corporation contracts under scrutiny in Thursday Senate hearing

by Jason Moore
Monday, July 13, 2009

ANCHORAGE, Alaska -- The preference that Alaska Native corporations receive in landing federal contracts is coming under increased scrutiny.

A hearing in the U.S. Senate later this week will examine the program, known as 8(a), which allows Alaska Native Corporations to receive larger no-bid contracts than other corporations.

Now, fearing the added scrutiny could alter the program, the corporations are fighting back.

Chugach Alaska could be the poster corporation for such contracts.

"For Chugach Alaska Corporation, the 8(a) contracting has provided the missing link of the Alaska Native Claims Settlement Act," said Sheri Buretta, chair of Chugach Alaska Corporation. "It created an economic engine for us to be able to create opportunities to give back to our shareholders."

Buretta says the contracts saved the company from bankruptcy in the 1990s. They now make up 70 percent of the corporation's $900 million annual revenue.

But Missouri Sen. Claire McCaskill has taken a keen interest in 8(a) contracts, looking into potential abuse and whether there is adequate oversight.

A new report shows Alaska Native corporations collected $500 million in 8(a) contracts in 2000.

Eight years later, that number skyrocketed to more than $5 billion.

Small business advocates claim the Native corporations, many of which are multi-million dollar giants, get an unfair advantage.

Buretta says the law is doing what it was intended to do.

"This is not a handout," Buretta said. "This is an opportunity for our people to be self-sustaining and create opportunities for themselves other than the old system of a handout from the federal government."

On Thursday, McCaskill holds a Senate subcommittee hearing to look further into the contracting process.

In advance of that, several Alaska Native corporations and some Native American groups formed a coalition called Native 8(a) Works, a new Web site, and, starting Tuesday, ads appearing on Politico.com and Roll Call, two online news sites.

Most 8(a) corporations can only received federal contracts of $5 million dollars or less.

But Alaska Native corporations, thanks to an amendment passed by Sen. Ted Stevens, have no limits on the size of contracts they can receive.

Contact Jason Moore at jmoore@ktuu.com