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Missouri Senator calls for investigation; Alaska Native Corporations push back

By Rhonda McBride 2:21 PM July 9, 2014

They’re fellow Democrats, but Sen. Mark Begich and Missouri Sen. Claire McCaskill are once again doing battle over Alaska Native Corporations.

McCaskill has called for a review of ANC participation in federal contracting programs in a letter to the head of the Small Business Administration.

Under the SBA’s 8(a) program for small and disadvantaged businesses, Alaska Native Corporations, Native American tribes and Hawaiian organizations have unique contracting privileges.

McCaskill has three main complaints: the SBA doesn’t provide adequate oversight of the program, that other companies have used Native Corporations to circumvent the federal contracting process, and not enough of the benefits go to Native shareholders, who live in poverty.

In a written statement provided by her staff Wednesday afternoon, McCaskill said she’s fought for six years to change the law in regard to ANCs.

“There has consistently been one problem — Mark Begich,” McCaskill wrote. “He single-handedly protects Alaska and the ANCs.”

Begich acknowledges there were problems in the past, but believes McCaskill blew those out of proportion and lacks a basic understanding of how the program was tailored specifically for the challenges of economic development in Alaska.

He said SBA revisions to the rules in 2011 have further improved accountability, a discussion he’s had many times with McCaskill.

“I said, over and over again, you’re living in the past of situations that did occur with some of the companies, that we came down hard on them. And at the same time, there’s been some good reforms done by the Small Business Administration,” Begich said. “Let the Small Business Administration move forward with the regulations and implement them. Let’s see how that plays out.”

Begich said he has invited McCaskill to Alaska many times to see how the program works here. He hopes her latest move isn’t another attempt to put more restrictions on a program he believes does a lot of good for Alaska Natives and the state as a whole.

“If she had additional restrictions she’s attempting to put on 8(a) corporations, she’s not moving forward,” Begich said. “And I’m going to do everything I can, along with Senator Murkowksi and Congressman Don Young, to make sure that doesn’t happen.”

Leaders at the Chugach Alaska Corporation call McCaskill’s latest demand for a review unnecessary because Native corporations have been complying with the new SBA guidelines, which require more reporting.

Sheri Buretta, chairman of the board for Chugach, said the Missouri senator repeatedly focuses on the negatives and not the positives, which are impressive.

“We have affected a generation of Alaska Native shareholders,” largely through scholarships and job training, Buretta said.

The Chugach Alaska Corporation serves the Prince William Sound region. It has about 2,500 shareholders.

Chugach was one of more than 200 Native corporations created to settle land claims so the Trans-Alaska Pipeline could go forward. Under the Alaska Native Claims Settlement Act, which was signed into law in 1971, corporations received land and money and Alaska Natives suddenly became shareholders in an economic experiment that continues today.

For Native corporations, there have been many ups and downs since the passage of ANCSA. Chugach went bankrupt at one point, but Buretta said the 8(a) program came to the corporation’s rescue and ushered in a new era of opportunity.

Today, Chugach has subsidiaries that manage federal contracts in construction and facilities maintenance, as well as providing other technical and educational services.

Last year, over $13 million in profits went to shareholder programs, including almost $9 million in dividends and additional payments to the elderly, Buretta said. The corporation also spent $750,000 in scholarships and $280,000 in paid internships and apprentice programs.

There was also a $2 million donation to the Chugach Heritage Foundation, a non-profit that promotes the Native cultures of the Chugach region, which include the Eyak.

Ramona Curry’s late mother, Marie Smith, was the last speaker of the Eyak language, once heard near Cordova.

Curry works as a procurement manager for one of the Chugach subsidiaries. She believes the corporation’s effort to preserve Native culture is one of its most important missions.

Curry is angered by McCaskill’s call for yet another review.

“I was absolutely shocked,” Curry said. “I have seen the benefits. I have experienced the benefit. I observe it every day.”

Curry said because of Chugach support, shareholders can go online and learn about the Eyak language, which otherwise might have completely disappeared.

This year the corporation celebrated the 20th Anniversary of the Nuuciq Spirit Camp, held every summer – a time when elders pass on their knowledge about cultural values, as well as language, dance and gathering and preserving food from the land.

“Our elders are like talking history books,” said Jayme Johnson, who oversees the spirit camp. “Once they’re gone, they’re gone, if we don’t make that connection now.”

Johnson is a shareholder development specialist for Chugach. She said the corporation has contributed more than $40,000 toward her bachelor’s degree in business management. She also has a minor in Alaska Native studies and policy as well as in fine arts. Johnson has also begun work on her master’s degree with support from the corporation.

“I don’t think I would have been able to get as far as I have today, without their assistance,” said Johnson, who has also had paid internships and leadership training.

Johnson is not alone. The cubicles of the Chugach offices in Midtown Anchorage are filled with shareholders who were educated and mentored on the corporate dime, including Corey Tiedeman, who is a safety supervisor for a Chugach subsidiary.

He manages federal contracts all over the world, and says the logistics are challenging.

“Trying to set up project meetings with the Marshall Islands, California. Alaska. Over in New Jersey – all at the same time,” Tiedeman said. “It can be a little difficult.”

“The mentors I’ve been able to work with over the past couple of years have opened my eyes to the world,” Tiedeman said.

Although Tiedeman hopes to have a lifelong career at Chugach, others have gone on to take jobs outside the corporation, which Buretta said provides Alaska’s workforce with expertise it might not otherwise have.

From the dividends Native shareholders spend in Alaska to the investments in Alaska businesses to the corporate taxes they pay, the state as a whole benefits from the success of Native corporations.

Economists say they are an increasingly important economic engine for the state.

Buretta said these are the things she wishes McCaskill could see in Alaska.

“We invite her to come up here and learn about us,” said Buretta. “Get to know who we are. Look at our challenges.”

So far, McCaskill has yet to respond to the invitation.

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