July 8, 2009

CONTRACTING OVERSIGHT SUBCOMMITTEE TO EXAMINE EXEMPTIONS FAVORING ALASKA NATIVE CORPORATIONS

WASHINGTON, D.C. – The Subcommittee on Contracting Oversight, led by Chairman Claire McCaskill, will hold a public hearing on Thursday, July 16th examining contracting policies that favor Alaska Native Corporations (ANCs). Not only is there little to no competition for these large contracts, based on a federal loophole, many of the companies who received the contracts do much of their work outside Alaska.
                                                                                                                                            
Current federal law exempts ANCs from several small business contracting rules, which allows ANCs to obtain large multi-million dollar contracts without any competition. Late last month, the subcommittee released a preliminary analysis of publicly-available data on ANC contracts, and the subcommittee is planning to release the results of a broader investigation that will include an analysis of materials produced by 20 ANCs in response to subcommittee document requests sent in May. 
 
Alaska Native Corporations were created by a 1971 law that aimed to foster economic development in Alaska, and in 1986, Congress made ANCs eligible to participate in the Small Business Administration’s 8(a) program. Under that program, eligible small and disadvantaged businesses can be awarded small federal contracts on a sole-source basis with no competition.  To qualify for the 8(a) program the contract must be relatively small – valued at under $5.5 million for goods or $3.5 million for services – but Congress carved out an exemption for ANCs, giving them the ability to receive no-bid contracts of any size under the 8(a) program. As a result, ANCs are uniquely eligible to receive huge federal contracts without having to compete with other bidders.
 
Who:                            Subcommittee on Contracting Oversight
 

What:                          Public Hearing on Contracting Preferences for Alaska Native Corporations

When:                         Thursday, July 16, 2009, at 2:30 PM

 
Where:                        Dirksen Senate Office Building Room SD-342
 
Witnesses:                 Panel I
Panel II
 
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