By SUZANNE DOWNING
A major overhaul of federal contracting at the Pentagon is putting Alaska Native Corporations under renewed scrutiny, following a directive by Department of War Secretary Pete Hegseth to review and potentially terminate large no-bid contracts awarded through the Small Business Administration’s 8(a) Business Development Program.
“We are taking a sledgehammer to the oldest DEI program in the federal government — the 8(a) program,” he said.
We are taking a sledgehammer to the oldest DEI program in the federal government—the 8(a) program. pic.twitter.com/c9iH8gcqG7
— Secretary of War Pete Hegseth (@SecWar) January 16, 2026
Hegseth announced his department would immediately conduct a line-by-line review of every sole-source 8(a) contract exceeding $20 million. Smaller contracts may also be examined. The directive is part of a broader effort to cut waste, eliminate fraud, and refocus military spending on what he describes as “lethality” and warfighting capability.
While the order applies nationwide, it carries particular significance for Alaska.
Alaska Native corporations are among the largest and most active participants in the 8(a) program, which grants them unique advantages under federal law stemming from the Alaska Native Claims Settlement Act of 1971.
Unlike most 8(a) firms, Alaska Native corporations are allowed to receive an unlimited number of sole-source contracts with no dollar cap, can operate multiple subsidiaries within the program, and frequently participate in joint ventures and mentor-protégé arrangements. Over the past two decades, ANC subsidiaries have secured billions of dollars in Department of Defense contracts, particularly in information technology, logistics, base operations, and facilities management.
Federal contracts using 8(a) Native preferences now under scrutiny for fraud
Hegseth’s review targets two practices that critics have long associated with the 8(a) program:
- Pass-through contracting, where the small business performs little of the work itself, and
- Awards that do not directly support military readiness. Under the new enforcement posture, the company awarded the contract must perform the work itself, rather than subcontracting the bulk of it to large consulting firms.
Contracts that are deemed unrelated to warfighting effectiveness are also vulnerable to termination or non-renewal.
The Pentagon review follows heightened congressional scrutiny led by Joni Ernst, who sent letters in late 2025 to senior defense officials alleging abuse of the 8(a) program. Her inquiries specifically named Alaska Native Corporations, including NANA Regional Corporation and Chenega Corporation, and she raised concerns about overlapping subsidiaries operating under the same NAICS business codes and the timing rules that govern participation in the program.
Those allegations have been disputed by the corporations involved, which argue that the claims rely on misinterpretations of SBA regulations and incomplete data. ANC leaders have emphasized that their contracting authority is not race-based, but rooted in federal law designed to promote Native self-determination and economic sustainability.
Some Alaska Native Corporations, including Calista Corporation, have reportedly submitted compliance explanations directly to the Department of Defense in anticipation of increased audits.
If Hegseth’s directive leads to contract cancellations or tighter enforcement, the effects could ripple well beyond Washington, D.C. Revenue from federal contracting supports dividends, scholarships, shareholder benefits, and employment across Alaska, particularly in rural regions with limited private-sector opportunities.
At the same time, well-run ANC subsidiaries should survive a stricter system, and may even benefit if competitors are removed for noncompliance.
The review does not amount to a blanket termination of all 8(a) contracts, but it signals a sharp shift in tone. Sole-source awards, once considered routine for ANC subsidiaries, may face higher hurdles, more documentation requirements, and closer performance oversight.
For Alaska Native corporations, the coming months may determine whether decades of reliance on the 8(a) program can continue under a defense contracting system that is increasingly focused on competition, performance, and direct military value.
15 thoughts on “Hegseth orders review of 8(a) Defense contracts, raising stakes for Alaska Native corporations”
It’s about time. Many Native corporations don’t follow rules. One simple rule is the drug testing. They simply don’t report failures,
The status of these types of contracts should be discontinued under the Title 8 programs. Congress needs to reconstruct thinking to meet the seriousness of contracting to a broader USA only group of contractors to service and build for the military. The military equipment of any kind used by our forces needs to be removed from this status and given to contractors for their specialty of purpose. Using Title 8 and given to groups put of need basis detracts and destroys the end product. Look at the inexperienced hands on and management. Another group that should not have these types of contracts are the prison groups. All of these issues need to change to fit the here and now and not the older thinking of what is a necessity to improve employability.
Everyone in Alaska with a brain larger than 1 cell knows these programs are corrupt and mainly used for money laundering but, until now, nobody bothered to do anything about it. Why?
Had Daddy’s Little Princess played ‘nice’ in the political sand-box, maybe this scrutiny of the Native 8(a) program wouldn’t occur. However, since Lisa-being-Lisa, she’s going to … “Find Out” the consequences for her unhinged-ness! She’s willingly – intently – willfully – arrogantly made herself an enemy of DJT, for whatever her seemingly crazy excuses, and now we’ll get to see her true ‘flawed’ character as she won’t be able to hide the ‘unbecoming’ element so many of us clearly see and, have had to endure during her tenure.
Secretary Hegseth clearly does not understand that gas and electric bills have risen, particularly for the starving 8a corporation executives living in the large homes on the Anchorage Hillside.
Sometimes you are absolutely and hilariously right on!
The Title 8 programs need to be redone and most of all just cancelled and amended in the CFR’s and the USC. These are programs for third world countries and the USA is far beyond that. So, the programs such as this that has made many Alaska Native corps wealthy and those corps that have abused the programs by subletting the contracts to others need to be without those opportunities. Its time! Grow up, pay your taxes and quit thinking the world owes you!
In terms of raising a family, when the kids are grown, let them go!
The natives of Alaska and the Indians on reservations of choice have had years to create the change and generational growth with honoring their heritage, it just the time at this stage.of heritage to grow up and beyond. Let go of the crutches!
Alaska Natives are not stupid; if the Federal government or anyone else wants to give them money – they will take it. This virtue-signaling has gone on for many decades and will probably never stop.
Those executives need to be jailed and assets seized as they have left their Village Corporations in ruins and not living where they are supposed to. The 13 Regional corporations are suppose to protect and support the Village corps . But it seems they forgot that part, and the real Natives get screwed again.
I am an elder Alaska Native woman who fully supports Donald J Trump and his administration. I do know that our Native Corporations have raised many Alaska Natives out of poverty. They give many scholarships to those who have worked hard and give them wonderful opportunities to become productive citizens. Our children can participate in sports like Native Youth Olympics, basketball and skiing. This keeps our children healthy in body and in mind. I think if you do an audit on our Native Corporations that they will be above board.
With all due respect, AK Native corps are decidedly not above board. I’m sure you and your families have benefited in some ways, but to say that the leaders of these corporations put the well being of their Native brethren over their greed is naive. And it’s been a struggle to get any audits done because any whisper of accountability gets met with screams of ‘racism’. They’re good at shutting down any outside criticism because it’s coming from someone who’s ‘white’. I’ve never met a more entitled group of people than those I worked with who were affiliated with Native Corps.
I worked for many years with these corporations with TAPS and the oil industry. Their greed and deceit is legendary and this review is long overdue and incredibly welcome. I saw quite a bit, and the stories I’ve heard from people who work in Native Corporations about the abuse, misuse and fraud were enlightening and infuriating. And they weren’t complaining. They were bragging.
Being Native, Indian or Eskimo does not entitle anyone to no bid contract awards. If you have a company that can do the job, put in a bid like everyone else to prove it. Native Corps have been fleecing taxpayers for decades and it’s high time it comes to an end.
I worked for 8 years on both bases, for an unnamed native corporation. Every 2 years they would change the name of the subdivision i worked for, to get those sole source contracts.
It was a running joke at work, ” who are we working for this week”?
I worked as entry control office at JBER, 2002-2012. Can’t remember the names, but the company we worked for, non-native lost their contract because Chenaga came in basically calling JBER racist because they didn’t hire native. They used this 8a program to bounce out the company we worked for.
Not one native was hired. None of them could pass hiring requirements since if you have a domestic violence convention, Can’t work as armed security, plus couldn’t pass security background checks.
The Air Force dropped the contract and went back to the Airman manning the gates.
No-bids or preferential bids have never been fair or right. Time to end that monopoly. As for any fear that the Republicans will lose Native votes…. ummm… that’s never been a thing anyway. Except maybe for Lisa, the RINO.
What type of services do the native corporations provide? Do they have Learing Centers, or what?