Willy Templeton: Please describe the background of your involvement in ANCSA.
Robert W. Rude: Okay, I became involved in the Alaska Native land claims matters when I attended the first Alaska Native statewide meeting held in Anchorage, Alaska, on October 18, 1966. This meeting led to the formation of the Alaska Federation of Natives, AFN.
At the three-day meeting, a board of directors was elected which appointed me to represent the unorganized interior Athabascan Indian. The recommendation by the land claims committee was approved by the conference. One of the recommendations of the land claims committee was that a land freeze be imposed on all federal lands until Native claims were resolved. On October 21, 1966, I filed land claim for the unorganized Athabascan Indians. My filing included: we have inhabited the drainages between the Kuskokwim and the Yukon Rivers since long before the white man came to this country. My people have also inhabited some of the areas draining from the south into the Kuskokwim and from the north into the Yukon and as far east and north as the Tanana River area.
At the time of the land claim, I sent a letter to all the village councils in the area claimed informing them of my filing, and I included a copy of a story that was in the Anchorage News dated October 22, 1966, and encouraged the villages to organize and send representatives to the AFN conference that would be held in 1967.
|Robert W. Rude
A fellow by the name of Andy Demoski from Nevada wrote me back later to inform me that there would be an organizational meeting of several villages and I was invited to attend but I could not afford the cost of travel because my wife was about to have our first child and I was working as a machinist apprentice at the Alaska Railroad. I stayed out of land claim matters until August, 1970, because of a lack of finances.
In August of 1970, I was hired by AFN as a coordinator for supplemental services. As an employee of AFN, I attended many of the AFN meetings and learned a lot about Indian land claims and Indian sovereignty. In August of 1970, I was elected to the Cook Inlet Native Association (CINA) board of directors. In March 1971, I was elected president and became executive director and obtained several non-profit contracts for the organization.
I believed in Indian self-determination, and I led CINA from being a social organization into a contracting entity, and we secured a number of state and federal contracts. CINA's employment base grew to as many as 85 employees and the organization administered millions of state and federal dollars.
As an AFN employee in 1970 and 1971, my office was right next door to the BIA conference room. There was a group of village representatives that was organizing the corporation without any input from at-large Natives. I and Roy Huhndorf, who was also an employee of AFN, attended these meetings and we weren't received too hospitably. They allowed us to sit in and when the organization was forming, there were 20 board members and only two of the seats were going to be reserved for urban Natives and then two seats for CINA. We objected and after many debates, heated debates, we managed to secure five seats for CINA representatives and three at-large seats to represent Natives who were not from Anchorage or from a village. There were twelve seats for the village representatives and after enrollment figures were complete, they showed the villages represented about 20 percent of CIRI's enrollment, and there was 80 percent enrollment of at-large and urban Natives.
In the formation of CIRI, there was a prohibition levied by the villagers that enrollees residing out of Cook Inlet Region could not run for the board of directors, and I felt this was an injustice. We had about 2,400 or 2,500 shareholders residing in other states of America and also out of Cook Inlet Region. At the first annual meeting in 1974, I led a proxy drive, the first proxy drive in the history of CIRI. Through that effort, I managed to secure about 65 percent of the shareholder vote. In using these proxies, we elected people that would be willing to change the policy of CIRI to open the door for at-large shareholders and shareholders residing in other regions of Alaska to run for our board of directors. We also did away with geographic representation on the CIRI board which allowed a majority of the board to be composed of village representatives. In organizing CIRI, 12 of the 20 board seats were set aside for village representatives. The elimination of geographic representation allowed any voting CIRI shareholder regardless where he or she resided to run for CIRI's board of directors.
CINA was very instrumental in the early 1970s when we became a contractor for social service programs. In addition to the state and federal service contracts, CINA operated a Bingo hall. CINA's bingo operations produced about $225,000 to $250,000 per year which allowed us to fund scholarship programs for CIRI shareholders residing in Cook Inlet Region. BIA scholarships also permitted CINA to award scholarships to other Alaska Natives and American Indians. CINA's bingo operation also funded burial grants, potlatches, Native dances, Native Olympics, beauty pageants, and other cultural events. CINA was very instrumental in handling non-profit functions for CIRI. It was recognized as the non-profit arm of CIRI in the late 1970s and early 1980s.
As executive director of CINA, one of my main goals was to create a housing authority. I knew housing was a need for our people. This led me to form the Cook Inlet Housing Authority (CIHA). After the housing authority was formed, I made elderly housing a first priority for CIHA. Our second priority, was first time owners. Today it is a very successful entity and CIHA was used by many Cook Inlet Natives to acquire housing.
Willy Templeton: What was the promise of ANCSA thirty years ago? Has it fulfilled the promise? If not, what happened and why?
Robert W. Rude: I believe ANCSA fulfilled some of the promises but did not fulfill all of the promises. Section 2(b) of the Act stated the settlement would be accomplished rapidly with certainty and conformity with the real economic and social needs of Natives without litigation with maximum participation by Natives and decisions affecting their rights and property. I called this the Indian self-determination clause. The provisions of section 2(b) were not fulfilled by the Act. It was not accomplished rapidly, with certainty, and conformity with the real economic and social needs of Natives. Lands set aside for selection by CIRI were mountains and glaciers instead lands of similar character as stated in section 11(a)(3)(a). Lands were not conveyed rapidly and with certainty.
There were many lawsuits filed by Native corporations against the federal government. Native corporations also sued each other on land selections and shareholder enrollments. The Act was unclear, which led to losses costing the corporations tens of millions of dollars. Utilizing capital for lawsuits and battlings for lands of similar character used up much of CIRI's early start-up capital. Natives were often excluded in participating or were often denied information about their corporation. The ANCSA 1985 Study said that of the individual Natives surveyed, 84 percent said they were interested in knowing more about ANCSA. They also wanted to know more about their corporations. To this day, there is a lack of information about the corporations flowing to shareholders.
Willy Templeton: Were the unintended consequences of ANCSA developments that no one foresaw?
Robert W. Rude: I believe Native leaders fighting for the land claims may have overlooked the fact that Natives lacked business and corporate experience. The many timelines included in ANCSA required Natives to form corporations, enroll shareholders, invest millions of dollars, distribute ANCSA monies to shareholders, organize their shareholders, learn to produce annual reports, proxy statements, audits, and select lands for surface and subsurface values. With thirteen regional corporations, there are approximately 220 village corporations, there was a shortage of Native individuals with the proper experience to do what was required in the Act.
I believe Natives involved in ANCSA's formation did not give enough thought about enrollment provisions in ANCSA. Only those born before and alive on December 18, 1971, were qualified for enrollment. This qualification excluded many Natives born after December 18, 1971, and the one-quarter blood quantum excluded more. ANCSA divided Natives into two groups, those who were shareholders and those who were not. I have often heard of Native families where divisions occurred within their children where one was the shareholder and one was not. This has caused feelings of being left out for those who are not allowed to enroll in ANCSA and participate as shareholders.
A 1968 Federal Field Committee report listed a deficiency in regards to urban needs. They did not share in village lands. The report stated to make up for this deficiency, settlement provisions asserting the distribution of compensation may provide the opportunity to resolve the inequities. Urban Natives were not given any additional benefits to make up for the deficiency of not sharing in the village lands.
Restrictions on stock transferred until January 1, 1992, made it impossible for older shareholders to ever see that their value of their stock before they died. And it hindered the raising of business capital for the Native corporations. Many Natives were unaware that ANCSA extinguished aboriginal hunting and fishing rights, and they would be under the jurisdiction of state regulations for hunting and fishing.
Since corporations' main goals are to produce profits, the goals of the corporations would often clash with the lifestyles of Alaska Natives. The need to produce cash made many Native corporations sell land, clear cut timber, subdivide and sell some of their lands and deed some of their village or group lands to their shareholders. The 20 year tax exemption was not sufficient time for the corporations to gain experience and make business investments and develop their lands because the conveyance of lands was not timely. Even to this day, Native corporations have not obtained their full land entitlements.
When you look at the provisions of enrollment, stock restrictions and tax exemptions, it appeared to me that ANCSA was designed for this generation only. ANCSA permitted stock transfers upon the death of a shareholder where the person's stock could be transferred to heirs but the person could not vote the shares unless he or she was a Native. Today, shares owned by some heirs have now fallen to less than five shares in many of the corporations. Holding less than five shares brings little return so many of these people would be ripe for a buyout.
Government taxation places an additional burden on the corporations and could eventually lead to their demise. I believe we should have sought tax exemptions for our Native lands until they were developed or sold to non-Natives. This is a provision that is found in the 1906 Native allotment act.
Willy Templeton: How has ANCSA changed Alaskans, particularly Alaska Natives? What values of Alaska Natives have been changed or challenged?
Robert W. Rude: After ANCSA was adopted, Alaska Natives were introduced to corporations. The primary goals of corporations are to make profits and pay dividends. Making profits generally require development and sale of land and resources. Once the corporate structure was accepted by Alaska Natives, values began to change. Some ANCSA corporations have clearcut timber on their land. Some have leased and traded Alaska lands for other properties, often located out of Alaska. I estimate over one million acres that have been lost by trades and sales.
An increasing Native and non-Native population has placed additional stress on the fish and wildlife stocks in Alaska. This has made it more difficult to subsist off the land and waters of Alaska. The reduction of Native land holdings also made it more difficult for Natives to subsist. With an increasing Native population and an increasing non-Native population, fish and wildlife stocks are falling. And it is more difficult to live off the land.
The increase in Native and non-Native populations have also placed a serious impact on securing employment for Alaska Natives in rural and urban settings. I believe that a loss of subsistence opportunities in rural Alaska, the lack of job opportunities, and an increasing cost of living will result in many rural Natives migrating to urban centers. Their movement to urban centers will result in more Natives living in poverty as they attempt to compete with non-Natives for employment and housing.
Alaska Natives are caught in the middle of two cultures. The original culture was built around subsistence and living off the land. With the passage of ANCSA, they find that their lands belong to the corporation, and some of the corporations have no provisions that open the lands to their shareholders for subsistence purposes. According to the ANCSA 1985 study, Natives who were employed by the corporations were those who benefited the most because of ANCSA.
Willy Templeton: What does the next 30 years hold? Is ANCSA a model of societal engineering in need of revision or is it perfect?
Robert W. Rude: The 1968 Federal Field Committee report included that legislation providing a special role for Native development corporations is directed towards economic and equity for Natives with other Americans and towards their economic integration into the life of the nation.
Another statement made in the report was, in the case of grants of commercially valuable land for income purposes, however, the point is to get them into a productive income earning position and indeed to get them on the tax rolls. Taxation of Native profits and lands could lead to more and more lands that will be developed or sold, then the original land entitlements of ANCSA will diminish over the coming years.
As an example, CIRI had an original land entitlement of 1,301,515 acres of surface and 2,366,685 acres of subsurface estate. Due to a shortage of lands of similar character, CIRI had to acquire special legislation allowing it to convert 602,399 acres of its surface and subsurface entitlement for federal surplus properties, many of which were located outside of Alaska. When CIRI traded their land entitlements in Alaska for these federal surplus properties, the trades also included the subsurface estate. Through sales and trade, CIRI land entitlement is now at approximately 605,000 acres of surface estate and 1.3 million acres of subsurface estate.
The use of Exxon-Valdez oil spill funds to purchase Native lands is another example of reducing subsistence lands. ANCSA is not a model for social engineering and it is in need of revision. It is not a perfect act. It was an act of deception. I can remember when ANCSA was first adopted. Natives thought they were going to share in the lands, and dividends were being counted on to change their lifestyles. Their expectations were not met and most Native shareholders never prospered by ANCSA.
I believe ANCSA needs to be revised where lands are not taxed until they are developed or sold to non-Natives. Native shareholders should be able to participate in decisions which affect their rights and stock values. Currently, ANCSA shareholders are not under SEC regulations. They are not covered by Sarbanes Oxley legislation. They do not fall under Indian law because we were formed under State law. And the State of Alaska, Division of Banking and Securities does not interpret nor do they enforce ANCSA provisions or Title 10, the corporate code for an ANCSA corporation. We are without enforcement and there is no oversight by state or federal government and Natives lack basic rights as shareholders.
Willy Templeton: What is your favorite ANCSA story?
Robert W. Rude: My favorite ANCSA story would probably be remembering a trip to Washington, D.C., to negotiate for the right of CIRI to obtain lands of a similar character instead of mountain tops and glaciers, which were withdrawn for our selection rights. The representatives of CIRI were gone for several days at a time, sometimes as much as a week or more, and we often negotiated with state and federal officials late into the night. I can remember our team was so tired, some of them even slept on the floor as other members took turns negotiating.
At one point, when we were negotiating for lands in the Kenai moose range and federal officials were saying the moose were more important than Natives, the negotiations got pretty heated. Deciding to take a break for dinner, we had ordered some deli food from the Purple Pickle. As we begin eating, we noticed state and federal negotiators didn't have anything to eat, so we buried our hostile feelings and we invited them to share in our meal. The sharing helped smooth out the negotiations.