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Positive Impacts of SBA 8(a) Program Defended
Indian Affairs Committee hearing focuses on successes of SBA 8(a) Program


April 11, 2011

(SitNews) - Washington, D.C. - At the request of U.S. Senators Mark Begich (D-AK) and Daniel Inouye (D-HI), the Senate Indian Affairs Committee held a hearing last Thursday to highlight the successes of the SBA 8(a) Business Development Program. Entitled Promise Fulfilled - the Role of the 8(a) Program in Enhancing Economic Development in Indian Country, the purpose of the hearing was to highlight the positive impacts of Alaska Native Corporations (ANC), Native Hawaiian Organizations, and Indian tribal entity participation in the program.

Panelists included Alaska Federation of Natives President Julie Kitka, National Congress of American Indians Executive Director Jackie Johnson-Pata, Coeur d’Alene Tribe Chief James Allen and representatives from the Small Business Administration.

“Today is a chance to shed the full light on the success of the 8(a) program and the advances in employment and self sufficiency they have supported,” Sen. Begich said. “We have come a long way in the lives of Alaska Native People.”

Sen. Begich pointed out although there have been major advancements for Alaska Natives in the last several decades, steep obstacles remain including gas costing upwards of $10 per gallon in many rural areas; 46 communities across the state still relying on “honeybuckets”; one-third of rural communities still haul water from a community source; and 20 percent of Alaska Natives continue to live in poverty.

Begich emphasized many of the companies involved in the 8(a) program play an important role as taxpaying businesses, creating jobs and boosting local economies.

“This is not an entitlement. It’s not a hand out. It’s a step to help create opportunity,” Begich said.

“When the Native 8(a) program was first started, the goal was to provide an economic development tool to provide economic self-sufficiency for Native communities. The intent was a “helping hand” and not a “handout” via social welfare programs. This program has demonstrated success, and as a result, it has become a target,” said Sen. Inouye. “In Hawaii, we have established Native Hawaiian Organizations (NHO). Native Hawaiian Organizations are non-profit organizations, managed by Native Hawaiian individuals and principally serving Native Hawaiians, which have majority ownership by an 8(a) designated for-profit firm. NHO’s are the youngest among the Native 8(a) businesses. However, they are making their mark in the Native Hawaiian community in a positive way. They are becoming more competitive in government contracting. As they become profitable, social programs and Native Hawaiians benefit. I truly hope it continues.”

Sen. Begich said the SBA should be recognized for its rigorous tribal consultation process to ensure the needs of Native participants in the 8(a) program were recognized and previous loopholes closed. The SBA had a number of tribal consultations and discussions with impacted communities, which helped to shape new regulations designed to better serve both the government and contractors.

In prepared testimony Joe Jordan, SBA Associate Administrator, Government Contracting and Business Development, identified the extensive work done by the agency to have a thorough tribal dialogue and consultation in line with the President’s Executive Order on Native Consultation.

Alaska Federation of Natives President Julie Kitka said in prepared testimony, "I would like to make clear that the AFN has zero tolerance for abuses of this program, or for media hype, which is not grounded in fact." She said, "AFN and I candidly recognize that there have been isolated instances of abuse or lapses in judgment by some involved in the 8(a) program. We do not condone such abuses or lapses and are committed to helping ensure that they are not repeated."

Kitka said, " We believe that the implementation of the new SBA regulations will go a long way toward making sure that they are not. We are committed to ensure the long-term benefits of this program are shared between the federal agencies for whom we do work, and for our young growing population, which is continually building their experience and expertise. By the same token, we urge this Committee and others in Congress to not let a few such instances be misused to destroy this highly meritorious and effective program for others in need of the opportunity it affords Native Americans."

As some on Capitol Hill single out and challenge Alaska Native Corporations’ participation in the Small Business Administration’s 8(a) program, U.S. Senator Lisa Murkowski (R-AK) lashed back in the hearing of the Senate Committee on Indian Affairs. “My colleagues want to measure the Indian 8(a) program with a spreadsheet, but bean counters can’t measure self-sufficiency or innovation.”

The Alaska Native Corporations are exempted from a contract cap and automatically classified as “disadvantaged,” a label criticized during the hearing based on income data. “When some of my colleagues are dismissive about Alaska Natives being categorized ‘disadvantaged,’” Murkowski observed, “they must realize we’re talking about a population, many times, without a road system or water supply system and not just a lump average income statistic.”

The Small Business Administration made a number of revisions to 8(a) programs last month – at the request of ANCs, Native American and Hawaiian groups – tightening many of the reporting requirements and raising the accountability standards.

“The 8(a) reforms have just been put into place, with a new standard for stronger business practices. What the Alaska Native Corporations and the 8(a) community deserve now isn’t a DC crackdown, but time for the improvements to take root,” said Murkowski.



On the Web:

OVERSIGHT HEARING on "Promise Fulfilled: The Role of the SBA 8(a) Program in Enhancing Economic Development in Indian Country."


In the News:

Alaska Native Firms Shift Stimulus Work to Outsiders
ProPublica, Jan. 27, 2011

Revenues for ANCs Skyrocket, but Not Payouts to Natives
ProPublica, Dec. 15, 2010

Rampant Fraud, Self-Dealing Alleged in Alaska Native Corporation
ProPublica, Dec. 15, 2010


Sources of News: 

Office of U.S. Senator Lisa Murkowski

Office of U.S. Senator Mark Begich

U.S. Senate Committee on Indian Affairs


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Ketchikan, Alaska