Native shareholders in remote Alaskan village get windfall

ANCHORAGE, Alaska -- In a tiny storm-battered fishing village on Kodiak Island, the native residents are about to get rich.

On Friday, their village corporation is sending $100,000 to every shareholder -- 147 people in all -- as it cashes out of the bulk of a $36 million trust built from the Alaska Native Claims Settlement Act.

In January, each shareholders gets another $100,000.

"This is the chance of a lifetime," says John Yakanak, a 33-year-old fisherman from Kodiak City, across the island from the village of Akhiok. He sees the money launching a business in sport fishing or outdoor guides.

But in Akhiok, a lonely collection of 34 modest homes on the edge of the Gulf of Alaska, Mayor Diana Simeonoff worries about the repercussions from all that money.

The average income in town is about $33,400, most of it from government work and seasonal jobs.

Simeonoff fears native elders -- Akhiok is predominantly Alutiiq, or Russian Aleut -- will be taken advantage by people who want to get at the money. But most of all, she worries that people will now move away and take their children from the village.

"Our school has only 12 students right now," she said. "If it falls below 10 students, there will be no school. It will be shut down."

The distribution from the fund, Akhiok Kaguyak Inc., will be the largest single cash payout ever to individual shareholders of the more than 200 regional and village native-owned corporations created by Congress through the Alaska Native Claims Settlement Act.

Compensation for land

The 1971 law authorized the corporations to select 44 million acres of land and gave more than $960 million to the corporations as compensation for the loss of lands historically held.

The Akhiok fund was created by the sale of 77,000 acres to the Exxon Valdez Trustee Council in 1995 to be maintained as wilderness.

Earlier this month, 79 percent of the shareholders voted to liquidate $31 million of the trust -- leaving $5 million in an investment fund for future generations, said fund chairwoman Pauline O'Brien.

They narrowly rejected a move to liquidate the entire account.

"This means, for many shareholders, an opportunity to establish their own businesses, to buy their own homes, to send their kids to college," O'Brien said.

Akhiok Kaguyak has sponsored investment workshops for the shareholders, many of whom live in Anchorage, Kodiak City and Seattle. And Alaska State Troopers from Kodiak City visited village leaders this week to discuss possible problems.

But not everyone in the tiny village of 80 residents is happy. Ralph Eluska said he resigned his corporate presidency last spring when the seven-member board made it clear they favored cashing out instead of continuing to pay $1,000-a-month dividends to shareholders.

"That asset was supposed to last several lifetimes," Eluska said. "It's not right for the current generation to benefit at the expense of those not yet born.

"By cashing out, the legacy is gone."

But Yakanak sees the money as fuel for shareholders to build their own legacies. Alaska residents also get an annual check averaging $1,800 from the state's Permanent Fund, which pays dividends from state oil revenues.

"Who better to take care of my future generations than myself rather than a bunch of corporation investors?" Yakanak said. "The dividends were good money but not enough to back something like a business venture.

"This is an opportunity to make a better life for me, my wife and two kids."