In Alaska, a government investigation is underway into Alaska Native corporations who have profited from the Small Business Administration Federal 8(a)

status. The Alaska Daily News in a March 19 story reported, "Some Native corporations, in joint ventures with huge multinational firms, have won sole-source contracts in the $2 billion range.

"Working for Uncle Sam has turned several Native corporations into formidable businesses," the paper said.   "Almost all of the top 10 Alaskan-owned companies, based on total revenue, are Native firms. Chugach Alaska Corp., for example, which makes most of its money from Federal contracting, generated $700 million in revenue in 2004.   Chenega Corp., the corporation for a tiny village, made $481 million."

Criticism has come from other minorities, including tribes from the lower 48 states who are calling it a monopoly.

"They have created a monopoly on Federal contracts," said long-time Laguna (N.M.) business consultant Michael Peacock. "And after the end of their nine year designation, some of them are creating subsidiaries."

The Federal 8(a) designation allows an approved Native American company to obtain sole-source Federal contracts without a ceiling on the amount, while other minorities and women-owned businesses can get nothing greater than $5 million.   Peacock, who has helped a dozen New Mexico firms achieve the designation over the past 10 years said, the program was created to help disadvantaged, small businesses compete with large national firms.

"All we want down here in the lower 48 states is for some of that money to be shared," he said. "They could subcontract some of that work with tribes down here."   But the bigger issue, Peacock said, is the government's contradiction.   "This program was started to give us some level of economic success and now that some of us have done so, they're saying 'hey wait a minute.' It's a contradiction.   The government is continuing to question us and making it difficult for us to progress."

"At a meeting held by the Native American Contractor's Association during the February RES2006 Summit in Las Vegas, many attendees expressed similar concerns," Peacock said.

Yet, the harshest criticism so far, is coming from the National Black Chamber of Commerce, "It's a cartel," Henry C. Alford, president of the Black Chamber, told the Alaska Daily News.

"You can't protest. You can't even say, 'I'm going to appeal this.' It's rigged. And it's going to lead to corruption and waste."

The paper said Alford sent an e-mail to some 100,000 black-owned business members of the group, in which he described the contracting perks given Native corporations as "corruption at the expense of the Civil Rights Act."

Alford said in the e-mail, that some Native corporations are in fact "white male-owned firms based mainly on the East Coast who pledge to kick back a

little of their net profits to some Eskimos in Alaska."

This prompted Robin Danner, who now runs the Honolulu-based Council for Native Hawaiian Advance-ment to respond to Alford.

"The ignorance and hateful tone of the National Black Chamber of Commerce e-blast is exactly the kind of ignorance that has challenged minority populations in America since its founding," Danner vented to Alford in an e-mail.

"Alaska Native corporations are not 'white-owned' companies," Danner wrote.

They are "social enterprises, owned by entire populations and communities of Alaska Natives," she wrote.

But some Alaska Natives believe the GAO report will vindicate them.

"People are anxious to see it come out because we think it's going to tell a good story, the right story. That the program is working as intended and that the benefits are going back to the shareholders," Sarah Lukin, spokeswoman for Alutiiq, a Kodiak Island village corporation that is one of the bigger players in government contracting told the News.

Alaska Daily News contributed to this story.
Their complete story can be found at:www.adn.com/money/story/7546945p-7458450c.html