Native American Contractors Association Responds to the Washington Post Series on Alaska Native Corporations

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Articles Misinform Readers on ANC Value to Shareholders, U.S. Taxpayers

Native communities are in need, and that need is undeniable. 8(a) is one of the only programs in history that has produced a positive impact for Native people across the United States.

Last week’s Washington Post series by Robert O’Harrow contained a number of inaccurate and misleading characterizations about the important work of Alaska Native Corporations (ANC). In response, the Native American Contractors Association (NACA) has dedicated a page on its website challenging the accuracy and objectivity of these articles. The information sets the record straight regarding the critical mission and strong value of ANCs to the U.S. government and Alaska Native people.

On August 26, 2010, NACA Executive Director Sarah Lukin sent Mr. O’Harrow an eight-page document spelling out the facts regarding the history, role and significance of ANC participation in the SBA 8(a) program. The majority of these facts and viewpoints were dismissed altogether in the Washington Post’s print articles.

A glaring omission from the entire Washington Post entire series was a balanced, thoughtful examination of the enormous sacrifice Alaska Native people made in exchange for promised business development opportunities to ensure long-term economic success. This includes the U.S. government’s commitment to honor and economically support the Alaska Native people after it seized millions of acres of oil-rich Native land worth hundreds of billions of dollars in exchange for the formation of ANCs and the promise to provide access to important economic initiatives such as the SBA 8(a) program. 8(a) embodies this promise; ANC participation in this program is core to Federal Indian Policy and honors the government’s promise to bring economic self-sufficiency to the Alaska Native people.

In the Washington Post’s second round of news coverage on October 1, 2010, reporter Robert O’Harrow continued his unprecedented attack on ANCs and the indigenous people they serve by misleading readers on industry efforts to bring greater transparency and accountability to ANC 8(a) contracting. The story, entitled “Breaking With Tradition, Native Executives Propose Reforms to ANCs,” irresponsibly led readers to believe the broad ANC community opposes efforts to strengthen ANC accountability. Just the opposite is true. In fact, NACA has joined other Native American organizations, such as the National Congress of American Indians and the National Center for American Indian Enterprise Development, in calling for increased compliance, transparency and education of Native Boards to closely monitor 8(a) company activities for years. (Read NACA’s joint recommendations.)

Mr. O’Harrow glossed over the fact that new regulations and legislative provisions already in motion will substantially improve oversight of ANC 8(a) participation. Specifically, new SBA proposed rule changes will establish a system to report benefits provided to the Native community from 8(a) participation. Additionally, these rules will impose new annual financial reporting for ANC 8(a) firms, create additional oversight by the SBA and agencies, and place new restrictions on ANC participation in the 8(a) program. In addition, the National Defense Authorization Act of FY2010 includes a provision (Section 811) which requires agencies to go through a formal Justification and Approval process for any sole-source award to a Native 8(a) over $20 million.

The ANCs that drafted the alternative policy proposal cited by Mr. O’Harrow have unique and significant access to natural resources and other investments, which provide them a reliable revenue stream outside of the 8(a) program. In essence, they can afford to compete outside of 8(a), unlike the vast majority of ANCs that do not have such resources and require participation in programs like 8(a) to build business capacity.

The Washington Post’s article series also misrepresented the fiduciary obligations required by all ANCs in reporting their financial statements. This, too, was pointed out in Ms. Lukin’s August 2010 letter to O’Harrow. Ms. Lukin wrote that “the overwhelming majority” of ANCs do file their annual reports with the state of Alaska – and “are completely open with the federal government regarding their respective financial pictures.” Ms. Lukin added that “every ANC 8(a) firm must submit an annual report to the SBA outlining and updating their business plan,” and that “new SBA regulations will require ANC, Tribal, and NHO 8(a)s to submit financial reports to the SBA annually.” Native Enterprises will continue to engage in full and open disclosure of their financial reports to their shareholders. None of these facts were included in Mr. O’Harrow’s articles.

Ms. Lukin also addressed statements by Senator Claire McCaskill: “Senator McCaskill’s position that Alaska Native people are being ‘used’ is offensive,” she stated. “ANCs are working hard to provide for Native communities, and the facts show 8(a) is helping Alaska Native communities. Since the formation of ANCs, the Alaska Native high school graduation rate has tripled, inflation-adjusted household income has risen by 50 percent and the proportion of Alaska Native people living below the poverty line decreased by roughly 50 percent. These facts prove ANCs and 8(a) are making a difference.”

Ms. Lukin continued: “Senator McCaskill’s assertion that Alaska Native people should be paid directly by the government and excluded from participating in the federal procurement marketplace suggests a return to the welfare system which has provably failed America’s indigenous people. Native people don’t need a hand out; we need the opportunity to contribute to our nation’s economy and experience our share of the American Dream.”

The Washington Post also failed to challenge Senator McCaskill’s questionable, and arguably hypocritical, characterization that ANCs are awarded “ridiculously, over-priced, noncompete government contracts.” Ironically, on September 30th, the day the first Washington Post story published, Missouri-based Boeing announced it had received a single sole-source contract totaling $11.9 Billion – more than twice what ANCs collectively received last year.

NACA’s website includes rebuttals to specific articles from the Washington Post series. Ms. Lukin stated the articles were “weak on substance and short on the facts.” She added: “Native communities are in need, and that need is undeniable. 8(a) is one of the only programs in history that has produced a positive impact for Native people across the United States. Congress must demonstrate, through action, that it stands with Indian Country and supports programs like 8(a) that promote economic self-sustainability for America’s indigenous people.”

For additional information contact Sarah Lukin at 202.758.2676

The Native American Contractors Association (NACA) is a national Native advocacy organization based in Washington, DC. NACA represents and serves almost 40 Tribal, Alaska Native Corporations (ANCs), and Native Hawaiian Organizations (NHOs) across the nation on issues relating to the economic self-sufficiency of America’s indigenous people, focusing on our members’ participation in government contracting and the Small Business Administration’s 8(a) Business Development Program. NACA’s members represent over 475,000 Tribal Members, Alaska Native Shareholders, and Native Hawaiians.

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