Giant Wackenhut Benefits From Small Business Act

Washington, D.C.-"Participation of the Alaska Native Corporations (ANCs) in the Small Business Administration 8(a) program has been troubling,"according to testimony by Mr. Michael L. Barrera, President & CEO, United States Hispanic Chamber of Commerce, today. He testified at a hearing of the U.S. Congress Subcommittee on Government Management, Organization and Procurement.

"Contrary to popular belief, ANCs are not small, economically disadvantaged tribal businesses. Most ANCs are very large businesseswith billions of dollars in revenues. We recommend that Congress make legislative changes to the 8(a) program so that ANCs are treated just like all the rest of the firms participating in the 8(a) program,"he concluded.

The 8(a) business development program, named for a section of the Small Business Act, is designed to help disadvantaged small businesses gain access to the federal procurement market. The hearing, chaired by Congressman Edolphus Towns (D-NY), discussed barriers embedded in the contracting process itself that can impede minority firms from winning government contracts, including the failure of agencies to break large contracts down into smaller projects so that minority firms can compete and ineffective screening for false minority fronts.
 
Under federal law, Alaska Native Corporations (formed under the 1971 Alaska Native Claims Settlement Act) are allowed access to no-bid minority and small business contracts of unlimited amounts. Where they lack expertise, they may pair with an experienced company not otherwise eligible for the award. The pairing may take the form of a joint venture or a subcontracting relationship.
 
"ANCs-despite the representations of the Small Business Administration-have an adverse impact on the other participants in the 8(a) program,"said Anthony Robinson, President of the Minority Business Enterprise Legal Defense and Education Fund. "Congress has an obligation to build a record on this issue of discrimination. ANC is having an adverse impact on the other participants in the 8(a) Program," he added.
 
In 2003, the US Army awarded Alutiiq Security and Technology, an ANC with little security experience, a contract to provide security services at US army bases. Alutiiq subcontracted up to 49 percent of this work to Wackenhut Services, Inc., a wholly owned subsidiary of the Wackenhut Corporation.

"ANCs have been an important part of Wackenhut obtaining federal contracts.  As a subcontractor to Alutiiq, Wackenhut obtained subcontracts without having to compete,"said Valarie Long, director of SEIU's Property Services division. "We're therefore delighted that today's congressional hearing could lead Congress in the direction of ensuring that the SBA program actually benefits small minority owned businesses, as Congress intended."
 
WSI is owned by the London-based security conglomerate G4S. G4S, the largest company trading on the London stock exchange, is under fire from international human rights groups and trade unions for the company's practices in southern Africa and elsewhere.