July 31, 2009
Senator Claire McCaskill
United States Senate
Hart Senate Office Building, SH-717
Washington, DC 20510
Dear Senator McCaskill:
On behalf of the Resource Development Council for Alaska, Inc., (RDC), I am writing to thank you for your willingness to consider and incorporate information on the Alaska Native 8(a) businesses and subsequently modify your position on proposed reforms to the 8(a) program. I am encouraged by your willingness to listen to the bi-partisan Alaska congressional delegation on this issue. RDC supports the mission and directives of Alaska Native 8(a) businesses and although there has been significant progress since Congress established the 8(a) program, the original reasons for its creation still exist in Alaska.
RDC is an Alaskan non-profit business association founded in 1975. The RDC membership is comprised of individuals and companies from all resource sectors (oil and gas, mining, timber, tourism, and fisheries) as well as support sectors, labor unions, and local governments. In addition, all 13 Alaska Regional Corporations created through the Alaska Native Claims Settlement Act (ANCSA) are also members of RDC.
RDC’s purpose is to link these diverse interests together to encourage a strong, diversified private sector in Alaska and expand the state’s economic base through the responsible development of our natural resources. Along with operating in Alaska, many of our members also have operations in the Lower 48, including your home state of Missouri. The success these companies have in Alaska impacts their efforts around the rest of the United States, and vice versa. Since entry as a state, Missouri has been able to develop its resources and create a healthy, diverse economy for its citizens. Amongst that diverse economy are automobile assembly plants and a large agricultural base, both of which have shown significant reliance on government assistance of late. Alaska, entering as a state more than 100 years later, and not having a climate or geography for farming and being disadvantaged by distance to market for manufacturing, constantly strives to diversify its economy in other arenas. The 8(a) program helps Alaska do this.
Due to the potentially serious impact proposed changes to the 8(a) program could have, this issue is of great importance to our membership. The concern of the RDC membership included both those who participate in the 8(a) program and those who do not, evidence that the 8(a) program is working to help align Alaska’s diverse interests on economic development. Our executive committee voted unanimously to write this letter in support of Alaska Native 8(a) businesses, clearly illustrating the impact these changes, if adopted, would potentially have on all Alaskan companies.
When enacting ANCSA, Congress saw a way to end the poverty that gripped many Alaska Native communities. As the Senate Committee on Interior and Insular Affairs reported while deliberating the Act, “[Alaska Natives] are among the most disadvantaged citizens of the United States in terms of income, employment, educational attainment, life expectancy, health, nutrition, housing, and every important indicator of social welfare.” Today, many rural Alaskans still have difficulty making ends meet. Alaska Natives comprise 82% of the population in rural parts of the state. Poverty and unemployment rates amongst rural Alaskans, particularly rural Alaska Natives, still far outpace those of their urban Alaska counterparts. Per-capita income of Alaska Natives is about half that of non-Natives. The precipitously high cost of living in rural Alaska exacerbates the economic hardships they face. Alaskans living in rural villages pay extraordinarily high prices for food, energy, transportation, and communication due to their communities’ isolation far from the road system and power grid, their villages’ low populations, not to mention Alaska’s extreme climate and permafrost. The lack of economic opportunities available to offset these costs has caused a social and cultural crisis of out migration from villages to urban Alaska.
Indeed, Congress enacted ANCSA in order to provide a means by which Alaska Natives could derive economic benefit from the resources around them, oftentimes in rural Alaska. Native corporations are the largest private landowners in Alaska and responsible resource development offers these corporations the opportunity to generate jobs and economic benefits for their Alaska Native shareholders. Resource development on ANCSA lands counters the aforementioned economic challenges by stimulating the job market and providing greater financial selfsufficiency for a growing number of Alaska Natives. These opportunities support the implicit promise Congress made to Alaska Natives when it offered them resource-rich lands in exchange for extinguishment of their aboriginal claims. Without ANCSA and the intentions therein, resource development, including vital national resources like the Trans-Alaska Pipeline System, may not have been realized. Such projects could be stymied under the veil of incessant litigation, and one need only reference the ongoing delays that occur with First Nation disputes in Canada to see where we could be without ANCSA. The 44 million acres of fee-simple land that were allocated to Alaskan Native corporations through ANCSA were meant to help bring Alaska Natives to the path of economic self-sustainability. Alaska Native people sacrificed millions of acres of land (321 million in fact) in exchange for meaningful economic development opportunities. Much of this remaining acreage now exists as national parks and wildlife refuges, unavailable for economic opportunities. Through 7(i) and 7(j) revenue sharing, profits from responsible resource development on their lands are shared with other Native Corporations statewide.
But, despite Congress’ best intentions, resource development and land title alone have proven insufficient to materially overcome the economic and social challenges Alaska Natives face. The 8(a) program has been an effective tool the federal government has used to help meet the goals of ANCSA. This effective tool should be improved and used as a model to further the economic status of Native Americans across the country, not eliminated.
With success in the 8(a) program, Alaska Regional Native Corporations build capacity, develop a trained workforce in diverse sectors, and ultimately provide opportunities for shareholders to advance other causes, such as responsibly developing the natural resources on their land here in Alaska. However, without the economic diversification earned from 8(a) revenues, these companies would oftentimes be unable to bring such responsible Alaskan projects to fruition, ultimately risking jobs, educational opportunities, and further revenue outside of the 8(a) program, potentially increasing reliance on other government programs. Ultimately, for programs like 8(a) to succeed, sufficient time must be given to allow their positive impacts to be realized.
Again, I am encouraged by your willingness to listen. I urge you to thoroughly understand the
impacts any proposed changes to the 8(a) program could have on Alaska Natives and the original
intent of ANCSA. The 8(a) program is critical to the future economic viability of Alaska Native
Corporations and in turn, their Alaska Native shareholders.
Thank you for your consideration of my comments.
Sincerely,
Jason W. Brune
Resource Development Council for Alaska, Inc.
