Alaska Native village corporations: sleeping giant? ANCSA village corporations will continue to expand and develop their business operations both within and outside Alaska.

• Author: Poe, Bob

Alaska Native village corporations may be a sleeping giant whose role in Alaska's economic destiny is not only misunderstood but also perhaps underestimated. In fact, in 2003, three village corporations were among the Top 49 Alaskan-owned and -operated companies in Alaska, and village corporations made up 23 percent of the Alaska Native corporations on the list and 6.12 percent of all of the companies on the list.

A question that came out of Commonwealth North's Urban Rural Unity Study several years ago perhaps best illustrates this: "Isn't rural economic development really the responsibility of the Native village corporations?"

The study was undertaken in 2000 on the very difficult topic of how to bridge Alaska's so-called urban/rural divide. Of particular focus at the time was the seemingly never-ending argument over a rural preference for subsistence use of Alaska's fish and game resources.

While the CN study group considered the factors that drive rural economic development, a well known and respected business leader front Anchorage asked whether rural economic development wasn't really the responsibility of the nearly 200 village corporations created under the Alaska Native Claims Settlement Act, known as ANCSA. While this comment immediately raised a number of countervailing arguments from the group, it was illustrative of the misunderstanding that some of Alaska's top business leaders still have about ANCSA corporations today.

Quite simply, the answer to the business leader's question is "no." ANCSA companies behave essentially like any other company from an economic perspective and are not responsible for rural development. Each of these companies is seeking investment opportunities to provide their shareholders the best economic return they can find within acceptable risk parameters. On the other hand, unlike other businesses, most ANCSA corporations are concerned with their shareholders' social needs. Section 2(b) of ANCSA itself states clearly: "the settlement should be accomplished rapidly, with certainty, in conformity with the real economic and social needs of Natives.... "

INVESTING IN RURAL ALASKA

In 2000, Commonwealth North's study group received several presentations from ANCSA village corporation leaders and others knowledgeable about rural development. Throughout the discussion it was clear that many rural investment opportunities presented a significantly higher risk and offered generally lower levels of return on...