Fairbanks Daily News-Miner: Murkowski defends no-bid Native contracts; seeks federal talks

Sen. Lisa Murkowski, who opposes a new law requiring federal contracting officers to give a written explanation of any no-bid contract worth more than $20 million, says the Department of Defense should first conduct "formal consultations" with Alaska Native tribes before regulations are adopted.

The language on federal contracting policy was inserted in the defense authorization act last fall by a conference committee without generating any attention in Alaska until after it happened.

The provision will probably mean that contracting officers will want to put those big contracts out to competitive bid instead of using sole-source agreements with Alaska Native corporations under the 8(a) small business program. Getting superiors to sign off on a public document about the reasons the competitive process is not warranted will be time-consuming and politically risky for all involved.

The only firms eligible at the moment for getting sole-source contracts worth more than $20 million in the so-called 8(a) program are the Native owned 8(a) firms.

They received this status because of language placed in federal law by Sen. Ted Stevens starting in the 1980s that gave Alaska Natives benefits not available to other minority groups in the U.S.

Alaska Native corporations have received billions of dollars in contracts through the system and say that it works well for them and the government.

Murkowski, Sen. Mark Begich and Rep. Don Young, have defended the status quo and said that Alaska Natives were not consulted about the change, a point that Murkowski made again in a letter to the secretary of defense.

"We fear these new requirements, which have yet to be articulated, are creating a chilling effect on all contracting officers, government wide, limiting procurement opportunities for Native-owned firms," Murkowski and Sen. James Inhofe, an Oklahoma Republican, wrote to Secretary of Defense Robert Gates today.

The plan to curtail no-bid awards has been championed by Sen. Claire McCaskill, a Missouri Democrat. She has said the ability of Alaska Native firms to get federal contracts of any amount is a severe abuse of the system.

"The provision effectively caps the ANC's no-bid contracts at $20 million by requiring federal agencies to use the same procedures for sole-source contracts to ANCs worth more than $20 million that they would use for similar contracts to other large corporations," her office said in a press release last fall.

Murkowski and Inhofe said today the 8(a) program is "one of the few government programs that enable Native communities to create economic opportunity with the hope of lifting entire communities out of the pervasive effects of poverty."

McCaskill and others have argued that the federal contracting process should not be a poverty-relief program aimed at one group. Instead, the government should seek the best value on its contracts by competitive bidding and deal with social welfare programs in other ways.

Murkowski, Begich and the political establishment in Alaska have countered that the provisions inserted by Stevens should remain as a benefit to Alaska Natives.

Murkowski and Inhofe asked the defense secretary to do what he can to see that the new limit on no-bid contracts "is not remembered in history as another ill-conceived federal policy toward our nation's first Americans."

Source: By Dermot Cole. Originally published April 21, 2010