Federal Initiative Hurts Many State Businesses



Members of the New Mexico 8(a) and Minority Business Association are speaking out against a provision in the 2000 Department of Defense Appropriations Act that allows federal officials to award contracts to Alaska Native Corporations (ANC's) without going through a competitive bidding process and with no price cap.

Los Alamos National Laboratory currently has one ANC contract and is looking at another, said NNSA Contracting Officer Anthony Lovato in a telephone interview Monday.

Chugach Corp. currently holds a janitorial contract at the lab.

"I had heard there were rumors that Chugach was going to replace KSL but that's not true," Lovato said. "I spoke at a chamber breakfast a few weeks ago to dispel that rumor. KSL has a $150 million a year contract and we're not going to suddenly switch contractors."

LANL could take the contract away from KSL, Lavato said, and give it to Chugach to have its small business requirements met for a year, but said that is not what they want to do.

"We want to diversify the businesses and not just meet the numbers," he said. "We don't want every small business dependent on the lab. We want them to also contract with ANC's, NNSA, KSL and others."

He added that LANL is looking at replacing IBM as the integrator on the Enterprise Project. In 2002, the Lab selected IBM to provide hardware for central computing systems to help integrate, unify, modernize and streamline their administrative operations.

The initial contract was worth nearly $2 million and required IBM to provide computer hardware to replace the laboratory's entire administrative computing infrastructure. The Alaskan firm of ASRCAC will be the umbrella contractor taking over the contract, Lavato said.

"ASRCAC will team with several Northern New Mexico firms on the contract," he said.

Lovato said that unlike American Natives, the ANC's have corporations rather than tribes.

ASRCAC is one of 10 divisions of Arctic Slope Regional Corp. (ASRC), owned by the Inupiat Eskimos of Alaska's north slope.

In Los Alamos, one of the divisions of ASCG designed a facility to store and dispose of mixed wastes. The Mixed Waste Disposal Facility is part of LANL's Environmental Restoration Program.

ASCG's work under the contract consisted of designing a disposal facility, constructing three buildings and a disposal pit.

One of ASCG's divisions also designed a segment of the highway on U.S. 285 from the Lincoln/DeBaca County line north to the Junction of U.S. 60, according to the ASCG web site.

ASCG performed the study and design of the Paseo Del Norte/Coors Road Interchange in Albuquerque.

The firm performed Airport Design on several New Mexico facilities, including the Artesia Municipal Airport, Clayton Municipal Airport, Deming Runway Extension, Dona Ana County Airport, Grants/Milan Municipal Airport, Lea County-Hobbs Airport, Roswell Industrial Air Center, Sierra Blanca Airport in Ruidoso and the Truth or Consequences Airport.

The Alaskan firm also worked on an Albuquerque water and sewer infrastructure design, designed a Base Refueling Station at Holloman AFB, and together with Flintco West, was selected to design and build a new campus for the Santa Fe Indian School.

Sen. Ted Stevens, R-Alaska, inserted the controversial provision in the Act, which excludes Native Americans and Hawaiian Natives from the no bid, no ceiling advantage.

"We are going to be the morticians of this law," said Anna Muller, president of NEDA Business Consultants Inc.

The Minority Business Development Agency of the U.S. Department of Commerce funds Muller's statewide minority business development company.

Her firm has assisted small and minority businesses for over three decades and Muller is fighting mad at the law that allows ANC's to enter New Mexico and take jobs away from local firms.

The history leading up to the creation of the ANC's began in the 1860s after the United States government purchased Alaska from the Russia government.

At that time, the Eskimos, Indians and Aleuts had been living in Alaska for thousands of years.

It was agreed that Alaska Natives had land rights to the lands they used. But for more than 100 years, it was not clear which land belonged to the Alaska Natives and which to the United States government.

The Alaska Native Claims Settlement Act (ANCSA) was finally passed in 1971. The intent of the law was to settle that 100-year-old question.

ANCSA created 13 regional corporations, which represent over 80,000 Alaska Native Eskimos, Indians and Aleuts.

The U.S. government paid $962.5 million to the Alaska Natives through those corporations.

Forty-three million acres of land also were set aside for the 13 regional corporations.

These corporations multiplied into some 200 subsidiaries all operating under the no bid, no ceiling provision.

Stevens says the law corrects an imbalance and helps a minority group that has had few job opportunities, according to the Indianz.com website.

He states the Native American exception is intended to advance the federal government's interest in promoting self-sufficiency and the economic development of Native American communities.

Stevens also insists it does so not on the basis of race, but rather, based upon the unique political and legal status of the aboriginal, indigenous, Native people.

The New Mexico 8(a) and Minority Business Association board is preparing a position paper voicing their opposition to the law, Muller said.

These Alaskan sole source contracts with unlimited ceilings can streamline the federal procurement process down to days rather than weeks or months.

The trend is steadily growing for government entities to bypass cumbersome bidding procedures and simply award contracts to the ANC's.

In a move by the National Imagery and Mapping Agency, Arctic Slope Regional Development Corp. and Chenega were given a $2 billion contract - a public request for proposals was never placed on the table.

The American Federation of Government Employees appealed the award to the Supreme Court saying the contracting set-asides violate the U.S. Constitution's ban on race-based preferences.

The Supreme Court rejected their appeal.

A coalition of regional and national minority businesses and trade associations will hold a summit in Albuquerque on Friday to discuss a national agenda for public policy and regulatory matters relating to minority and small businesses. This is the first time the summit, sponsored by the New Mexico 8(a) Association, NEDA Business Consultants Inc. and the Minority Small Business Council will be held outside the Washington D.C. beltway, Muller said.

The summit takes place from 4-6 p.m. at the Sheraton Old Town in Albuquerque.

The summit agenda lists a number of issues for discussion including:



Contract bundling.


Small Business Administration annual budget.


General Services Administration acquisition policy.

Summit coalition members include the National Minority Suppliers Development Council, Latin American Management Association, the Association for Small Business in Technology Inc., Minority Business Enterprise Legal Defense and Education Fund, President's Roundtable, and the Northern California and New Mexico 8(a) Minority Business Associations.


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