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Monday, October 18, 2010

Contracting Programs for Alaska Native Corporations: Historical Development and Legal Authorities

John R. Luckey
Legislative Attorney

Kate M. Manuel
Legislative Attorney

Roger Walke
Specialist in American Indian Policy

According to some reports, federal contract dollars awarded to Alaska Native Corporations and their subsidiaries increased by 916% between FY2000 and FY2008, going from $508.4 million to $5.2 billion. The dollars awarded to ANC-owned firms through the Small Business Administration’s (SBA’s) 8(a) Program, in particular, reportedly tripled between FY2004 ($1.1 billion) and FY2008 ($3.9 billion). This widely reported increase has generated congressional and public interest in the legal authorities governing contracting with these entities. Of particular interest are the authorities creating the alleged “special procurement advantages” that ANC subsidiaries enjoy in contracting under the 8(a) Program.

The 111
th Congress enacted legislation (P.L. 111-84) requiring justifications, approvals, and notices for sole-source contracts in excess of $20 million awarded through the 8(a) Program, including contracts with ANC-owned firms. An amendment to the Senate version of the National Defense Authorization Act for FY2010 (S.Amdt. 1762 to S. 1390) was also proposed, but subsequently withdrawn, that would have limited the Department of Defense’s authority to make sole-source awards in excess of $3.5 million ($5.5 million for manufacturing contracts) to ANCowned firms, as well as restricted agencies’ authority to pay subcontracting “bonuses” under the Indian Financing Act.

This report discusses the historical development of contracting programs for ANCs. It summarizes the general authorities governing contracting with ANCs and ANC-owned firms, as well as the specific authorities pertaining to issues that commonly recur in discussions of contracting with such firms (e.g., protests of sole source awards, size standards and affiliations, subcontracting bonuses). The report also describes legislative activity related to contracting with ANCs during the 111
th Congress and the changes that the SBA proposed on October 28, 2009, to the regulations governing contracting with ANCs under the 8(a) Program.

Date of Report: October 1, 2010
Number of Pages: 43
Order Number: R40855
Price: $29.95

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