Committees weigh Alaskan Native rule change

After a contentious hearing June 21, two House committee chairmen appear ready to seek changes in regulations that currently give Alaskan Native corporations a significant advantage over other companies in the federal 8(a) program in landing government contracts.

The hearing, held jointly by the Government Reform and Small Business committees, was a follow-up to a Government Accountability Office report in April that found agencies are awarding large sole-source contracts to ANCs without much oversight.

'Nowhere in the GAO report is there a statement that the contracts were awarded to Alaskan Native corporations because of the quality or value of the performance offered,' said Tom Davis (R-Va.), the Government Reform chairman.

Currently, ANCs in the 8(a) program, administered by the Small Business Administration, enjoy numerous advantages, most notably that they can be awarded sole-source contracts of any value, while other 8(a) firms can only receive such contracts worth up to $3 million for services or $5 million for products. ANCs also can have multiple subsidiaries enrolled in the 8(a) program, as long as they are in different industries, without combining their total sales toward 8(a) limits.

Of about 9,700 companies enrolled in the 8(a) program, 154 are subsidiaries of 49 ANCs, said Donald Manzullo (R-Ill.), chairman of the Small Business Committee, and they took in 13 percent of the program's total revenue.

Rep. Don Young (R-Alaska) defended the regulations, calling the hearing 'a thinly disguised attack' on a few very successful ANCs. They are 'doing right by the federal government, doing right by the taxpayers, and doing right by the Alaskan community,' he said.

'The 8(a) program is evolving into something it was never intended to do,' said Manzullo. 'As a whole, I see this going in the wrong direction; I see it as self-destructive.

'Nobody quarrels with the intent of the Native Claims Act or Alaskan Native corporations,' Davis said. 'I come at it from a different point of view, [of] federal procurement. Whenever you have sole-source bids, you just don't get the same value. I want to see you at the table'I just don't want you to have your own table.'

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