Native Village Corporations create prosperity, opportunity.

• Author: Strieker, Julie
• Position: ALASKA NATIVE

In recent years, Alaska's Native village corporations have been making big economic waves in the state. In fiscal year 2016, 22 percent of the total revenue generated by Alaska-based businesses came from village corporations, about $2.7 billion.

Add in the revenue from Alaska Native regional corporations, and the number grows to more than 70 percent of the $14.8 billion in revenue from Alaska-owned businesses.

The corporations were created under the 1971 Alaska Native Claims Settlement Act (ANCSA), which granted Alaska Natives title to 44 million acres of land and $962.5 million to clear land claims. Under ANCSA, twelve Alaska-based regional corporations and more than 200 village corporations were created, with the dual mandate to make money and provide for the educational, social, and cultural well-being of the shareholders. A thirteenth corporation was later set up for Alaska Natives living outside the state, but it did not receive a land distribution and was dissolved in 2013.

"We all have similar missions in terms of providing for our people and the well-being of our shareholders," says Hallie Bissett, executive director of the Alaska Native Village Corporation Association. "The biggest difference between the village and the regional corporations is the land ownership. Regional corporations own the subsurface estate and the village corporations will typically own the surface estate."

Sharing Resources

When regional corporations develop resources such as timber or oil and gas or zinc, they have to share those resource revenues with the villages through the 7(i) and 7(j) clauses of ANCSA, Bissett says.

"Any time there's a resource development within a Native community's private lands, that really impacts the entire state of Alaska," she says. "Through 7(i) or 7(j), every single village corporation gets revenue from that."

The 7(i) clause requires regional corporations to annually redistribute 70 percent of net revenues from resource development among all twelve Alaska-based regional corporations. Clause 7(j) requires the regional corporations to redistribute hall of those payments to village corporations and at-large members.

The clauses were included as a way to level the playing field between corporations in traditionally resource-rich areas and those in other places. According to a study released in February, "Successful resource development by one regional [Alaska Native corporation] means success for all."

The study (by the McDowell Group for ANCSA Regional Association) notes that between fiscal year 1982 and fiscal year 2015, approximately $3.1 billion (adjusted for inflation) has been distributed to all Alaska Native corporations under 7(i). About half of that amount was distributed to village corporations under 7(j). The overall amount has generally...