PETALUMA, CA, April 28, 2006 /PRNewswire/ -- The Government Accountability Office has released a new report detailing a significant lack of oversight by the Small Business Administration in its Alaska Native Corporation 8(a) contracting program. The report states, "SBA lacks adequate data regarding the 8(a) contracting program in general and does not collect any information on ANCs' 8(a) activity." The GAO cited a number of examples where Alaska Native Corporations and their partners were able to take unfair advantage of a program set up to assist small, disadvantaged, women-owned and minority-owned businesses.

The SBA is mandated with overseeing the 8(a) contracting program, but one contracting official told GAO that, "SBA has 'stepped aside' when it comes to overseeing 8(a) contracts and that it would not occur to her to coordinate . . . with SBA."

According to the report, ANC 8(a) contracts grew from $265 million in 2000 to over $1 billion in 2004, with a total procurement figure during those years of $2.9 billion. Special provisions allow the government to make these awards without competition in some instances. In addition, because ANCs are permitted to own an unlimited number of subsidiaries, the actual size of the corporation can be far greater than would be allowed under normal SBA size standards.

"The Alaska Native Corporation 8(a) program was designed for abuse and should be abolished immediately," said Lloyd Chapman, President of the American Small Business League. "Most of the benefits go to firms outside of Alaska, many of which are large, white male-owned businesses. This program has allowed billions of dollars to be diverted away from legitimately disadvantaged firms. Here is yet another example of the types of abuse in small business contracting that the SBA has condoned through its lack of action."

Chapman asserted that more than the SBA, he blames the Bush administration for slashing the agency's resources to the point where it's unable to perform its mission. "This damaging report is another nail in the coffin of the SBA. The Republicans are just itching for an excuse to close the agency and eliminate all Federal contracting programs for small and disadvantaged firms.

While SBA told GAO that it has implemented procedures to increase oversight of the ANCs, they failed to provide investigators with any evidence to support this.

About the ASBL
The American Small Business League was formed to promote and advocate policies that provide the greatest opportunity for small businesses - the 98% of U.S. companies with less than 100 employees. The ASBL is founded on the principle that small businesses, the backbone of a vital American economy, should receive the fair treatment promised by the Small Business Act of 1953. Representing small businesses in all fields and industries throughout the United States, the ASBL monitors existing policies and proposed policy changes by the Small Business Administration and other federal agencies that affect its members.

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