Thursday, November 5, 2009

Native Corporations as National Security Corporations

Native American corporations, particularly an array of Alaska Native Corporations, have become major defense and homeland security contractors – responsible for a wide range of national security operations, including electronic surveillance on the border, running immigrant detention centers, and supplying security and other services in U.S. overseas wars and energy exploitation.

Ahtna Inc., one of the thirteen Alaska Native Corporations (ANCs) established in 1971 through the Alaska Native Claims Settlement Act, received an infusion of federal funds in compensation for common lands lost to government and the private sector. Its subsidiary Ahtna Technical Services operates the Varick Street Detention Facility in Greenwich Village under a 2008 contract with Immigration and Customs Enforcement (ICE), which is an agency of the Department of Homeland Security.

Its role at the NYC immigrant detention center was reported recently in a New York Times article by Nina Bernstein. Ahtna is a major federal contractor. In addition to fifteen DHS immigrant-detention related contracts in 2009, the Native American corporation has multiple contracts with the Department of Defense, Department of Energy, and Veterans Affairs.

 Why does a Native American company from distant Alaska, one that was initially capitalized with federal funds, operate an immigrant detention center in the heart of New York? Because the Native Alaskan company specializes in penal services? Because it is intent on reviving the Indian connection with the original Manhattans who sold their island to the Dutch West India Company – and now want a better financial return? Because the federal government, and in particular the Department of Homeland Security, believes that these Alaskan natives deserve favored treatment in securing federal contracts?

 There is no ready answer that explains why Ahtna Technical Services has the ICE contract to manage, operate, and maintain the Varick Street Detention Facility in New York City. Nor is there a good explanation or rationale why Homeland Security has selected Ahtna, which has no experience in correctional services, to provide operational, maintenance, and other support services at two other ICE immigrant detention centers – Buffalo Federal Detention Facility and Krome Service Processing Center in Miami. In addition, ICE has contracted the Alaskan corporation to manage food services at six other ICE processing centers.

 The explanation lies in complex mix of well-intentioned economic development theory, grave historic grievances, modern identity politics and affirmative hiring, preferential contracting, political contrivances, a recent surge in government outsourcing, and ostensibly strict federal contracting requirements that are easily manipulated. Ahtna’s recent entrance into the immigrant incarceration business is but one example of how federal programs and statutes that were created to alleviate Native American poverty and promote development have become badly distorted and misused.

What Does Ahtna Do?

 That’s not easy to determine given the corporation’s own lack of specificity and the variety of its contracts. The simplest thing would be to say, as it does, that it is “A Full-Service Operations and Maintenance Company.”

 Or if you want a slighter more fleshed out description the Ahtna Development Corporation, the umbrella entity that spins out all the Ahtna subsidiaries, asserts that it “possesses the talent, vision and resources to the leader by providing our clients with customized solutions and the technological edge needed to meet their goals and to build partnerships, cultivate talent, invest in resources and integrate services in the marketplace of tomorrow.”

 What is more, Ahtna says it has:
“…positioned itself for future growth, both financially and geographically, by offering clients a strong, balanced, and diverse portfolio of services in both the private and public business arenas. [We are] a multi-disciplinary operations and maintenance (O&M) services company which offers a suite of service capabilities to federal agencies and private sector that are essentially global in nature.”
With respect to its “Business Classifications,” the Ahtna Development Corporation highlights its following four classifications for federal contracts: Alaska Native-owned, Woman-owned, Minority-owned, and Small Disadvantaged Business. Alaska Native Corporations have come under escalating criticism in the last couple of years from congressional oversight committees, governmental investigative bodies, angry competitors, and government watchdogs.

 At the heart of the mounting criticism of Ahtna and other Native American corporations, particularly the ANCs and the numerous Alaska Native Village Corporations, is the breakdown and abuse of federal contracting. Preferences are given to these Native American corporations in federal procurement as part of an affirmative action social and economic policy framework that was intended to offer economic development opportunities to impoverished, disadvantaged communities.

 But the preferences have functioned as shields to deflect competition, to gain access to no-bid contracts, and to pass the bounty of federal defense, homeland security, energy, and services contracts to non-Native partners. Nine of the top ten federal contractors based in Alaska were ANCs in 2009. Chugach Alaska Corporation, the top ANC federal contractor, won $496.7 million in federal contracts in 2009, according to preliminary estimates. Ahtna Inc. was sixth with $86.9 million.

Top 10 Federal Contractors in Alaska, 2009

Chugach Alaska Corporation $496,679,772
Nana Regional Corporation, Inc. $294,486,882
Afognak Native Corporation $207,556,969
Arctic Slope Regional Corporation $195,743,314
Inuit-Nci JV $90,490,505
Ahtna, Incorporated $86,865,509 
Watterson Construction Company $80,786,703
Suulutaaq/Sloan Fencing JV $73,496,604
The Kuskokwim Corporation $68,961,125
Ukpeagvik Inupiat Corporation $63,486,802


Through skillful political intervention and corporate maneuvering, the ANCs began to develop a higher profile in the late 1990s and blossomed this decade as national security corporations. More than 70% of ANC contracts in 2000-2008 came from the Department of Defense. From 2000 to 2008 DOD had $16.9 billion in contracts with Alaska Native Corporations. Next largest federal contractor was the Department of Interior with $1 billion in ANC contracts, followed by the Department of Homeland Security with $980 million in ANC contracts in the same period.

Next: Rise of the Native National Security Corporation Also see: New National Security Complex: Bringing Together Homeland Security, Intelligence, and Defense 


truthmonger said...

Do you realize that all Native contracting totals only 1.2% of federal procurement and that the profits are shared with tens of thousands of individuals. Lockheed Martin, ONE company, wins 7% of the federal procurement pie and 60% of their contracts are sole source. When it comes to the reason ANCs win work and why it is a good thing, the federal government would otherwise be issuing federal assistance to these rural communities...instead ANCs are providing good value, at competitive rates, performing in teh good to excellent category. This contract was an inherited problem...Ahtna is simply doing the work the federal govt asked them to do.

Tom Barry said...

Thanks for these observations. It's time for a full and honest debate about the problems and benefits of this type of preferntial contracting. There are multiple problems and concerns: a history of shoddy work, the majors using Native corporations as the front men while they do the work, the absence of Native Americans in the Native American corporations, and the fiction that these corporations really have the capacity to do most of what they say they do. There is also, of course, the ethical concern about profiting from war and immigrant imprisonment, whether Native or not.