Alaska Native Corporations' contracting status under fire again

Four ANCs have been among the top 100 recipients of contract awards, and in 2009 six companies made Washington Technology's Top 100 List of IT contractors.

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.