Village and urban native corporations: questions of balance.

• Author: Swagel, Will
• Position: SPECIAL SECTION: Alaska Native Corporation Review

A submarine fiber-optic cable provides broadband Internet service to Kodiak Island. A new hospital, triple the size of the old one, will serve Barrow and five surrounding villages. Crossing guards kept throngs of cruise ship tourists safe and secure on the jam-packed streets of downtown Juneau this summer.

These are all business services in Alaska made possible by Alaska Native village and urban corporations. These types of activities may be highly visible to the residents of a corporation's home village--many of them shareholders. The Alaska Native Claims Settlement Act created more than 240 urban and village corporations. In the 40 years since, many shareholders have moved elsewhere in Alaska, the Lower 48 or even overseas.

Those far-flung shareholders might pay more attention to the profits their Alaska Native Corporations obtain by utilizing their favorable standing in seeking government contracts. The same three corporations that laid the fiber-optic cable, built the new hospital and supplied the crossing guards also provide cybersecurity, submarine maintenance and heavy-lift helicopter repairs to various departments of the United States government.

While these corporations are tasked to maximize profits for their shareholders, they are also under strong pressure to be a source of economic development and employment in the home villages. Balancing these priorities occupies the chief executive officers of some of Alaska's top ANCs.

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"It's an ongoing conversation in almost every community at one point in time, as to whether the village corporation goes outside the village or even outside the region in order to provide revenue, because it can be very difficult to make much revenue at the local level," says Charles Parker, CEO of Alaska Village Initiatives. AVI provides training and consulting services to small ANCs and collaborates with larger ones on lobbying and advocacy. "They have to find a way to balance it."

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The village and urban ANCs range greatly in size. Parker says the largest have a score or more subsidiaries, hundreds of millions of dollars in revenue, and very competent management. But the majority of the corporations are mid-sized and have much smaller revenues and staffing. The smallest corporations may have no professional management and receive their funds largely from revenue sharing and land-use permits.

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A sizeable number of ANCs profit from special advantages granted them (along with Hawaiian Natives and...