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ISSUING NEW STOCK IN ANCSA
CORPORATIONS
MAUDE BLAIR*
BACKGROUND
In the late 1960s, oil was discovered on Alaska’s North Slope. A
pipeline cutting across the state was planned to pump that oil to an ice-
free port and get it to market. This necessitated the settlement of
aboriginal land claims, which had been simmering for years.
1
To that end,
the Alaska Native Claims Settlement Act (ANCSA or “Act”) was signed
into law on December 18, 1971.
2
The Act extinguished aboriginal land
claims and created thirteen regional for-profit Alaska Native
corporations
3
and more than 200 village corporations that generally
followed historical ethnic lines.
4
Alaska Native corporations (ANCs) are for-profit corporations
organized under the laws of the State of Alaska.
5
Under ANCSA itself,
these corporations received $962.5 million, retained title to forty-four
million acres of Alaska Native traditional land, and now manage this land
and money for the benefit of the Alaska Native people who were made
Copyright © 2016 by Maude Blair.
* Vice President of the Alaska Federation of Natives (AFN). Ms. Blair was
previously an in-house attorney at NANA Development Corporation, a wholly-
owned subsidiary of NANA Regional Corporation, Inc. (NANA). Ms. Blair and
many of her family members are NANA shareholders. The views expressed here
are her own.
1. Alaska Native Land Claims, Unit 4, Chapter 14, A
LASKOOL,
http://www.alaskool.org/projects/ancsa/landclaims/landclaims_unit4_ch14.h
tm (last visited Oct. 5, 2016) [hereinafter Alaska Native Land Claims, Unit 4, Chapter
14].
2. 43 U.S.C. §§ 1601–1629h (2012).
3. 43 U.S.C § 1606. Originally, the Act created twelve regional corporations
in the state of Alaska with the option for a thirteenth regional corporation to be
created for non-Alaska residents. Alaska Natives living outside of Alaska elected
to create and join The 13th Regional Corporation. The 13th Regional Corporation
was given a only monetary settlement, receiving no land, and not taking part in
the ANCSA Section 7(i) sharing provision, 43 U.S.C. § 1606(i), discussed below.
The 13th Regional Corporation was involuntarily dissolved by the Alaska
Department of Commerce, Community, and Economic Development in 2013.
References in this paper to twelve regional corporations exclude this thirteenth
corporation.
4. 43 U.S.C. § 1607.
5. 43 U.S.C. § 1606(d).
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274 ALASKA LAW REVIEW Vol. 33:2
shareholders of these new corporations.
6
Their operation is governed by
state and federal laws, some of which apply to all corporations and some
of which are specific to ANCs.
These corporations faced rocky starts as Alaska Native peoples who
had traditionally lived subsistence lifestyles now had to learn how to run
Western-style companies. Today, though, these unique entities are
economic powerhouses: twelve regional corporations and nine village
corporations were listed on Alaska Business Monthly’s roster of the top
forty-nine Alaska companies by gross revenue in 2016.
7
Much of this
revenue flows back to ANCs’ largely Alaska Native shareholders and the
economically depressed villages many still live in, in the form of
shareholder dividends, scholarships, elder benefits, and jobs.
These ANCSA corporations were originally designed to have special
protections for only twenty years, with unrestricted stock then being
issued in place of the restricted ANCSA stock.
8
Also, because it was a
settlement of legal claims, only the people alive at the time the Act was
signed were originally made shareholders and intended to benefit from
the settlement.
9
ANCSA corporations have all remained privately-held
corporations whose stock cannot be bought or sold, but rather can only
be transferred in statutorily limited ways.
10
As these corporations have
evolved, however, many have looked for ways to include Alaska Natives
who missed the original enrollment deadline and descendants of their
original shareholders. Alaska Native cultures all hold respect for elders
as a core value, so many have also looked for ways to give an extra benefit
to older shareholders.
This article focuses on the considerations and requirements of
issuing new stock in ANCSA corporations. To more completely describe
that process both in theory and practice, this article will necessarily draw
on both substantive law as well as the author’s personal experience as an
ANC in-house attorney and shareholder.
6. 43 U.S.C. §§ 1605, 1611. See also Alaska Native Land Claims, Unit 4, Chapter
14, supra note 1.
7. Top 49ers Announced by Alaska Business Monthly, ALASKA BUS. MONTHLY
(Sept. 28, 2016), http://www.akbizmag.com/Media-Arts/Top-49ers-Announced
-by-Alaska-Business-Monthly/.
8. The Annotated ANCSA, A
LASKOOL, http://www.alaskool.org/projects/
ancsa/annancsa.htm (last visited Oct. 12, 2016).
9. 43 U.S.C. § 1604(a).
10. 43 U.S.C. § 1606(h)(1)–(2).
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2016 ISSUING NEW STOCK 275
ORIGINAL ANCSA STOCK
Under the Act as it was originally written, there were two types of
stock (called “Settlement Common Stock” after the Act) in the
corporations: one for village residents and one for individuals who were
not village residents, also called “at-large” shareholders.
11
In order to
receive the first type of stock, applicants had to meet the statutory
definition of “Native,” live in one of the villages in the region, and apply
for shares with the Bureau of Indian Affairs (BIA) before the deadline the
agency set.
12
“Native” as defined by ANCSA means:
a citizen of the United States who is a person of one-fourth
degree or more Alaska Indian (including Tsimshian Indians not
enrolled in the Metlakatla Indian Community) Eskimo or Aleut
blood, or combination thereof. The term includes any Native as
so defined either or both of whose adoptive parents are not
Natives. It also includes, in the absence of proof of a minimum
blood quantum, any citizen of the United States who is regarded
as an Alaska Native by the Native village or Native group of
which he claims to be a member and whose father or mother is
(or, if deceased, was) regarded as Native by any village or
group.
13
Qualified applicants received 100 shares of stock in the regional
corporation and 100 shares of stock in a village corporation.
14
In order to receive “at-large” stock, applicants had to meet the
statutory definition of “Native,” have ties to the region but not be a
resident of a village in the region, and apply for shares with the BIA before
the deadline the agency set.
15
These shares were generally issued to
people who were living outside the region at the time of enrollment but
whose family was originally from the region; for example, someone in
boarding school or the military at the time of enrollment.
16
Shareholders
who qualified for “at-large” shares received 100 shares of regional
corporation stock and are entitled to a share of Section 7(i) distributions
under ANCSA Section 7(j).
17
11. 43 U.S.C. § 1604.
12. Preparation of a Roll of Alaska Natives, 43 C.F.R. §§ 69.1–.15 (Mar. 27,
1972) (repealed 1990), http://www.lbblawyers.com/ancsa/part69toc.htm
[hereinafter Preparation of a Roll of Alaska Natives].
13. 43 U.S.C. § 1602(b). Members of the Metlakatla Indian Community opted
to retain their reservation status and thus were exempt from most provisions in
the Act.
14. 43 U.S.C. § 1606(g)(1)(A).
15. See Preparation of a Roll of Alaska Natives, supra note 12.
16. See id.
17. ANCSA Section 7(i), codified at 43 U.S.C. § 1606(i), requires regional
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276 ALASKA LAW REVIEW Vol. 33:2
The BIA, through the Secretary of the Interior, was tasked with
preparing the roll of shareholders for each corporation for the two classes
of shares above.
18
Alaska Natives could appeal their eligibility
determination; or, to avoid the hardship of being enrolled in a different
corporation from their family members, the determination of which
corporation they were to be enrolled in.
19
The BIA sent regional
corporations a list of their new shareholders along with each
shareholder’s village corporation or “at-large” status, birthdate, the date
of death for some, social security number, shareholder ID number,
permanent residence as of April 1, 1970, and blood quantum.
20
The
corporations then had to issue the appropriate stock to the new
shareholders.
ANCSA stock may not be sold, pledged, subjected to a lien or
judgment execution, assigned in present or future, or treated as an asset
in bankruptcy or other insolvency proceedings.
21
The original language
of ANCSA would have restricted the stock for twenty years, after which
the stock would lose the protections and restrictions the companies had
under the Act. As 1991 approached, though, Alaska Native leaders
successfully pushed to have ANCSA changed to protect the unique status
and restrictions of these corporations for the benefit of their
shareholders.
22
There is still a provision in ANCSA whereby shareholders
can vote to issue non-Settlement Common Stock and make that stock
alienable,
23
but no ANC has yet opted to do so. Many Native leaders
wanted to include their children or those who missed the original
enrollment, so they also successfully petitioned to have the Act changed
corporations to divide 70% of all revenues received from timber and subsurface
resources among the twelve regional corporations in proportion to the number of
shareholders originally enrolled to each corporation. This section was the subject
of much litigation in the 1970s and is now governed by the Section 7(i) Settlement
Agreement, which was entered into by the regional corporations in 1982 and
subsequently amended. Section 7(j), codified at 43 U.S.C. § 1606(j), in part directs
each regional corporation to distribute not less than 50% of the annual Section 7(i)
distribution among village corporations and “at-large” shareholders in the region.
18. 43 U.S.C. § 1604.
19. Id.
20. These rolls took several years to prepare, and since ANCSA was a legal
settlement, the original shareholders were to be those people who were alive and
qualified on the day the act was signed. Id. Stock was issued and transferred to
the heirs of qualified individuals who passed away in the intervening years. Id.
21. 43 U.S.C. § 1606(h)(1)(B).
22. Act of Feb. 3, 1988, Pub. L. No. 100-241, 101 Stat. 1788.
23. 43 U.S.C. § 1606(h)(3) (discussing what occurs when a corporation lifts
alienability restrictions); Section 1629(c) (containing the procedure for lifting
restrictions).
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2016 ISSUING NEW STOCK 277
to include ways to issue new ANCSA stock to different classes of
shareholders.
24
MISSED ENROLLMENT
In 1967, the more than 200 Alaska Native villages situated across the
state’s vast lands had no satellite service, but instead depended entirely
on fourteen land radio stations that tied into 300 bush radios.
25
Eighty-
eight villages needed improved telephone service, seventy-two had only
“bush” telephone service, and sixteen had no telephone service at all.
26
By
1970, 141 of Alaska’s 287 village communities still had no satisfactory
telecommunication ties.
27
Of the 146 with such ties, eighty-four depended
on White Alice or less sophisticated systems, and sixty-two were linked
to the rest of the world by microwave or cable systems.
28
Further complicating matters was the fact that over twenty Alaska
Native languages were spoken in the state at the time of ANCSA’s
passage, with many of the Native peoples speaking little or no English.
29
Translating complicated concepts such as corporate stock ownership was
difficult at best. The Vietnam War was also being fought at the same time
ANCSA was passed and implemented, and did not end until 1975. Given
the state of communications at the time, it was nearly impossible for
Alaska Natives serving out of state in the Armed Forces to enroll in an
ANCSA corporation by the deadline.
In 1988, ANCSA was amended to allow corporations to issue shares
to people who met all of the requirements for original Settlement
Common Stock as listed above, but who were erroneously left off the rolls
or missed the application deadline.
30
Each corporation would determine
eligibility for these shares if they chose to create them.
31
With respect to
the regional corporations, Arctic Slope Regional Corporation (ASRC),
NANA, Doyon, Koniag, Sealaska, and Calista voted to create and issue
24. Act of Feb. 3, 1988.
25. Alaska’s Heritage,
ALASKA HUMANITIES FORUM,
http://www.akhistorycourse.org/americas-territory/alaskas-heritage/chapter-
4-13-communications (last visited Sept. 12, 2016). The White Alice
Communications System was a United States Air Force telecommunication
network constructed in Alaska during the Cold War. Id.
26. Id.
27. Id.
28. Id.
29. Alaska Native Land Claims – Unit 5, Chapter 23, A
LASKOOL,
http://www.alaskool.org/projects/ancsa/landclaims/LandClaims_Unit5_Ch23
.htm (last visited October 5, 2016) [hereinafter Alaska Native Land Claims – Unit 5,
Chapter 23].
30. 43 U.S.C. § 1606(g)(1)(B)(i)(II).
31. Act of Feb. 3, 1988, Pub. L. No. 100-241, § 2(6)–(7), 101 Stat. 1788, 1788–79.