Between Worlds - Culture as Corporation



Culture as Corporation
NANA shareholders adapt corporate life to the ways of the people.

By LORI THOMSON
THE JUNEAU EMPIRE

    NANA at a glance:

ANCSA land entitlement*:
2.25 million acres

ANCSA land conveyed so far:
1.48 million acres

Money from ANCSA:
$43.6 million

Businesses, partnerships, investments:
Red Dog Mine, NANA Development Corp., AKIMA Inc., NANA Oilfield Services Inc., Nullagvik Hotel, NANA/Lynden Logistics LLC, NANA/Marriott JV, NANA/Marriott LLC, NANA/VECO JV, investment portfolio.

Net Corporate Profits/Losses
per fiscal year
1973 $(378,300) 1974 $(238,204) 1975 $476,800 1976 $10,300 1977 $207,200 1978 $484,200 1979 $636,000 1980 $207,000 1981 $1,598,000 1982 $1,319,000 1983 $3,950,000 1984 $4,252,000 1985 $1,254,000 1986 $1,985,000 1987 $(1,990,000) 1988 $1,213,000 1989 $1,711,000 1990 $3,125,000 1991** $1,315,000 1992 $2,615,000 1993 $(1,890,000)

1994 $6,320,000 1995 $785,900 1996 $3,490,000 1997 $4,170,000

Shareholder Dividends
per 100 shares
1973 $0 1974 $0 1975 $0 1976 $0 1977 $0 1978 $50 1979 $75 1980 $75 1981 $125 1982 $125 1983 $150 1984 $200 1985 $125 1986 $125 1987 $125 1988 $125 1989 $175 1990 $250 1991 $145 1992 $188 1993 $150

1994** $170 1995 $375 1996 $255 1997 $261 Dollar amounts not adjusted for inflation.

Number of jobs provided by corporation and its subsidiaries:
About 2,000

Number of corporation jobs held by shareholders:
About 650

Total shareholders:
10,000

* These figures include land to which the corporation has partial title.

**15 months

ALL NUMBERS COMPILED IN LATE 1998.

At 23, Jimmy Baldwin, has racked up a sum of money most villagers only dream about.

He's poured about $100,000 into his snowmachine shop in Kiana by working behind the steering wheel of a front-end loader at the Red Dog zinc mine, owned by NANA Regional Corp.

For people such as Baldwin, NANA is fulfilling one of its main goals: offering work to shareholders. That's especially important in the region's 11 villages in northwest Alaska, where jobs are scarce and groceries are expensive.

"I don't know where I would have been today if I hadn't been one of the lucky kids that got their foot in the door," Baldwin said, as he sat on the sidelines one evening at the mine's basketball court.

NANA is one of the top job-providers among regional Native corporations.

In 1991, according to economist Steve Colt at the Institute of Economic Research in Anchorage.

 

pump
Red Dog Mine mill maintenance workers Lois Newlin, left, and Calvin Gooden fix a clogged pump underneath the sag mill at NANA's zinc mine near Kivalina.

PHOTO BY MICHAEL PENN

Shareholders make up about 28 percent of the 1,350 people who work for NANA and its subsidiaries. But that doesn't include most of the workers at the Red Dog mine, where shareholder hire rates are higher.

However, most of the corporation jobs are in Anchorage, Prudhoe Bay or at the Red Dog, which is dozens of miles from villages and can only be reached by airplane. Workers must spend weeks away from family or move away from their villages.

"Very few jobs pay like this. But it's a real tough life living up here and being married," Baldwin said. He spoke of his baby daughter at home, about 100 miles away, and how he hopes to work in Kiana in a few years.

Almost half of NANA jobs are located in Prudhoe Bay. These are largely positions with NANA Management Services, which provides housekeeping and food services for oil-industry workers, but NANA also provides other oil-field services, such as bus-driving and emergency medical care.

NANA's Anchorage operations include its business offices and food services at the Alaska Native Medical Center. The corporation also owns the Courtyard and Fairfield hotels, as well as the Residence Inn, which is being built.

As the biggest zinc producer in the world, the Red Dog is NANA's showpiece and one of the largest providers of jobs in the region. The mine also gives shareholders their best chance of getting high-paying jobs and continuing to live in their villages.

Although about 54 percent of the mine's jobs are held by NANA shareholders, they make up only about 15 percent of Red Dog managers. Cominco, the Canadian company that runs the mine, has training programs to prepare NANA shareholders for work at the mine, but many still aren't qualified for the more specialized positions, managers Said.

The original plan was that by 2001, shareholders would hold 100 percent of the jobs, or the closest percentage possible. But operating manager Tim Smith said reaching 100 percent shareholder-hire will "take generations."

NANA officials realized the original expectations for shareholder hire were too optimistic. The region's high-school dropout rate is high and graduates are often at the seventh-grade level, making it difficult to train people for upper positions at the mine, said Sarah Scanlan, NANA's vice president of corporate affairs in Anchorage.

The corporation is trying to address the problem, and recently created an education department to work with the schools on improving the curriculum.

Despite NANA's record of providing jobs, some shareholders complain NANA has had little effect in many parts of the region.

"We don't have any NANA jobs here," said Delores Barr, a corporate board member in Deering, about 60 miles south of Kotzebue. "They keep telling us they'll go to the villages and give us something, but they never did 25 years later."

NANA President and CEO Charlie Curtis said work in the villages has been a long-time dilemma.

"They're right," Curtis said. "We haven't really affected the villages in there, but it's not to say we aren't looking at it."

The corporation is trying to come up with ways to help shareholders who want to start businesses in their towns. NANA is also trying to increase scholarships so more people can earn degrees that will help them get jobs. The corporation plans to pump $150,000 into scholarships next year and is launching a scholarship trust fund.

Some villagers also gripe about how tough it is to apply for corporate jobs because NANA's biggest office is about 500 miles away in Anchorage instead of Kotzebue.

 

Curtis
"We haven't really affected the villages ... but it's not to say we aren't looking at it," says NANA CEO Charlie Curtis.

PHOTO BY MICHAEL PENN

The corporation's biggest customers, Arco Alaska Inc. and BP Exploration (Alaska), are based in Anchorage, which is why NANA keeps a large office there. However, the company is studying how technology may allow it to run more operations from its region.

With few jobs available in many villages in the region, NANA shareholders still rely heavily on subsistence hunting and fishing. Some in the northern part of the region worried how the Red Dog Mine would affect that.

Kivilina and Noatak, villages closest to the mine, each have committees to look at the mine's impacts on subsistence. Several elders on these committees said Cominco and NANA have had a good record so far.

"I think they are concerned about subsistence," said Joe Swan Sr. on Kivilina's subsistence committee. "They tried to help any way they could."

Swan said the Red Dog has affected subsistence somewhat, though not seriously. He suspects generator noise at the mine's port caused beluga whales to veer from their usual routes. Hunters have brought home only one beluga in the last two years, compared with the 30 or 40 they used to land each year. Kivilina residents also stopped picking berries along the mine road to the port because of worries that fuel spills might have contaminated berry patches.

But belugas make up just a part of local residents' subsistence diet, and there are other places to pick berries, Swan said.

The mine has improved water in nearby streams, which have high levels of metals naturally because of mineral deposits. Since the mine began, one stream now has fish living where they hadn't previously because Cominco diverted the water around one of the most mineralized areas, said Phyllis Weber Scannell, a state biologist in Fairbanks.

To preserve subsistence for its shareholders, NANA officials also worked with federal agencies to get special protection for land in the early years after the Native land claims settlement. While Natives in some regions bristled at federal subsistence regulations in parks, NANA worked with the agencies to place almost 13 million acres in a federal park, monument or preserve.

"The whole idea was to have the land protected for our use," said John Schaeffer, former NANA president.

NANA is also unusual because it's one of two regional corporations into which most of its village corporations merged. Kotzebue's Kikiktagruk Inupiat Corp. is the only village corporation that opted to remain independent from NANA because of KIC's size and location in the region's business hub.

The merger is widely seen as a wise move, especially because most villages have few or no marketable natural resources. And it helped preserve regional unity, compared with other areas where corporations became pitted against each other.

Some villagers, however, regret the decision.

"We made a big mistake when we merged with NANA," said James Moto, former president of the Deering tribal council. "We probably would have been broke, but we at least ..."

"... would have been free," his wife, Louise, finished for him.

While NANA's influence on its villages is minimal, the corporation was listed as 19th in revenues among Alaska-owned companies by Alaska Business Monthly in 1998.

Management is working on ways to cull some earnings from even its unprofitable operations, such as the Nullagvik Hotel in Kotzebue, which until now has largely served to offer jobs to shareholders. One of NANA's key goals is to become a billion-dollar corporation, instead of the $100 million company it is now.

"We've managed to make it work," Curtis said. "We've adapted to this type of life, like we always do."