Awards for Native American government contracts to super 8(a) tribal entities and Alaskan Native Corporations (ANC 8a Contracts) have become a serious issue for non-native American contractors. According to a GAO study, federal dollars obligated to tribal 8(a) firms grew from $2.1 billion in fiscal year 2005 to $5.5 billion in 2010, a greater percentage increase than non-tribal 8(a) obligations (160 percent versus 45 percent).
Members of the 112th Congress have introduced legislation (H.R. 598, S. 236) that would generally subject ANC-owned firms participating in the SBA Section 8a Program to the same treatment as individually owned firms.
Among other things, this legislation would prevent ANC-owned firms from receiving sole-source awards valued in excess of $4 million ($6.5 million for manufacturing contracts) under Section 8(a) of the Small Business Act.
Although there is some debate between ANC 8a and tribal entities on reservations, there is a national outcry about the amount of government contracting dollars going to what is commonly referred to as “super 8(a)” small businesses.
ANC Super 8a government contractors should consider building relationships with other small businesses across the country simply because agencies may welcome the fact that contracting dollars will additionally distributed across the country. ANC Conracts 8a organizations can still develop their small business programs to create a benefit for their tribal members to include employment, increased skills and training from ‘outside’ companies. See information about government incentive programs.
Is There an Imbalance of Native American and ANC 8a Contract Awards?
There is a sensitive issue and debate as to whether tribal reservations, “Super 8(a) companies,” get their fair share of federal contracting dollars when compared to ANC 8a contract companies.
Do government contracting agencies view them both as the same for purposes of an award? That issue has yet to be resolved. An argument can be made that ANC contracts with 8a organizations receive larger contracts than tribal reservation 8(a) contractors. However, agencies may have a hard time seeing the difference under procurement laws. ANC’s are arguably better developed and have the capability to produce more resources to acquire government contracts.
Business Development Improvements for 8a Tribal Entities on Indian Reservations?
Although the laws for Native American government contracts awards will not change anytime soon, 8(a) contractors on Indian reservations may want to assess their various business development programs to find what is working and to improve practices that do not increase their bottom line. There are different ways to accomplish this goal.
GAO Recommendations: GAO recommends that the Office of Federal Procurement Policy (OFPP) amend acquisition regulations and provide guidance (including data collection) on monitoring the limits on subcontracting.
GAO’s recommendations also include that SBA should include specific capabilities in its 8(a) database to improve tribal and ANC 8a tracking and that SBA should examine tribal participation to determine whether certain practices align with the 8(a) program’s business development goal. SBA questioned GAO’s methodology, which GAO continues to believe is appropriate but did not address GAO’s recommendations.
For questions or assistance with Native American government contracts or ANC 8a contracts, contact a Native American government contracts small business contract lawyer at 1-866-601-5518.