The money received through the OEO grants and the SBA guaranteed loan represented the capitalization with which the Corporation was able to buy a plant, equipment, and supplies, establish a payroll, and revamp facilities. In fact, without this "unusual example of cooperation," as one Federal official described the OEO-SBA collaboration, Albina Corporation may never have developed. (Albina's directors are still seeking other sources of funds, including a sizable loan application to the Presbyterian Economic Development Corporation located in New York City.)

Dependence on Government agencies will continue for a time although the OEO grants will probably not be renewed but simply expire when the money is used up. Severance of such ties is part of the overall goal of the Albina innovators. It will come more quickly the sooner Albina pays off its loans and develops its own product lines, stabilizes its workforce, and is assured of more contracts.

The development of Albina products—that is, items of which Albina alone would be the producer or resource, for example, a new design of fiberglass boat or an electro-mechanical assembly-is severely cramped by a limited budget, reports Ben L. Berry, vice president and chief engineer. Formerly with the consultant firm of TRW Systems in Redondo Beach, Calif., Berry insists that development of new product lines is "a necessary goal if we are to become a major company." A volunteer consultant and training director for Operation Bootstrap and other ghetto self-help projects in the Los Angeles area, Berry explains that "under a contract, the company has to meet competition by cut

ting into its profits to keep down costs, but if we have a patented product we can demand more profit; only a competitor's similar product could limit the price we could set."

Perhaps the most problematic internal concern in the company is the relationship between the black workforce and the white consultant every white man in the Albina Corporation at present is a consultant: he operates as a function of management but he cannot participate in the employee trust plan. Other companies attempting similar programs have experienced friction between black and white personnel. On the basis of interviews with employees at every level, the situation at Albina in this regard has been exceptional.

Among trainees the criticism most often voiced is based on the hiring of four white welders to complete one of the early contracts; some of the black workers believe that Negro welders should and could have been recruited to do the job. It didn't help, the dissenting employees indicated, that the white welders demanded and obtained a dollar above scale for their work.

The role of the white consultant at this phase in the development of the Albina firm and for its duplication anyplace else is considered "mandatory" by the corporation's innovator, Linus J. Niedermeyer, a successful Portland businessman and executive consultant to Albina. Ability and a degree of empathy with the black man were prerequisites in the consultants he recruited for the firm. Niedermeyer points out that white consultants had to accept two major limitations: within a minimum of one year and no more than three years, they would no longer work for Albina-a black counterpart was to be found or trained within that timeand they could not share in the employee stock plan. Higher salaries than previous were offered as an incentive and compensation for exclusion from the trust program, Niedermeyer added.

Highly optimistic of Albina's own future, Niedermeyer also is confident that a team of Albina personnel could duplicate the firm in its basic conceptual framework in any city in America within 60 days. But Government and private business and industry, he asserted, will watch Albina for the time being as a pilot program before further commitments are made. The Portland lumber executive credits the State's U.S. Senators and Portland area Congressmen in particular for supporting the Albina project within the State and in Washington, D.C. According to Niedermeyer, "Without the Oregon legislators to overcome the reluctance among some Government officials to back an idea

which is truly unique and innovative, Albina would not be in existence," he stresses. "After all, Albina is the first instance in which the Federal Government has funded a profit-making organization!"

Niedermeyer initiated his personal efforts to develop a ghetto enterprise along the lines of the Watts Manufacturing Company in 1967, but expanded the idea to include complete black ownership and operation as a necessary element. The concept of the Second Income Plan originated with Louis O. Kelso, of a San Francisco corporate law firm with whom Niedermeyer also conferred in developing the economic structure for Albina. Kelso has advanced the Two-Factor Theory, which is a concept of economics he has proposed to create a system of "universal capitalism" in the United States, by which all persons will have the equal economic opportunity to own capital. His firm has established a number of SIP trusts which enable corporations to finance growth on the pretax dollar and build equity quickly among its employees and executives.

The idea of establishing a black firm in Portland began to germinate more than three years ago. James Woods, president and general manager of Watts Manufacturing Company in Los Angeles, a subsidiary of Aerojet General Corporation, but black-managed, originally suggested the venture to Niedermeyer. But Niedermeyer rejected the subsidiary aspect of developing such a firm and moved toward the creation of a black-owned company. Conferences toward drawing up an OEO proposal started in February 1967 between Niedermeyer, Woods, and a Portland resident, Clifford J. Campbell, Sr., a longtime leader in the Negro civil rights movement and at present a senior consultant to the Ford Foundation. To elicit community support Niedermeyer, Campbell, and national and regional OEO officials presented the idea before the Albina Citizens' War on Poverty in July 1967. The final proposal went to OEO in Washington in October 1967 with the support of every black organization of size and importance in Portland.

The necessary boards were organized, a thousand details worked out, and on July 1, 1968, the converted bowling alley's doors were reopened. Campbell was elected interim president until Webb succeeded him as permanent head of Albina Corporation in September.

Campbell is often quoted for having said in regard to the city where Albina is being tested: "Portland is small enough to be manageable, but big enough to be meaningful." Niedermeyer fully agrees with Camp

bell's view, adding that "we whites, who feel a portion of the collective guilt for the black man's situation, believe this is an honest approach and not one that will perpetuate the system of dependence."

Campbell's assessment of Portland's potential is remarkably salient. The State of Oregon contains nearly 1.9 million people of whom 1.2 percent, or 23,000 people, are Negro. In the City of Portland, about 5 percent of the population is Negro, totaling about 20,000 persons, all but a tenth of the black people in the State. Most of the black Portlandites reside within the 20 square block region of Albina. Clearly, then, Albina Corporation represents the firmest hope for escape from the ghetto for Oregon's black people. Its future is also Oregon's future in black-white relations. From the business side, Webb states, the burden is on local businesses to support Albina's effort. In fact, he has told a meeting of the Portland City Club, "This corporation demands profitable business from our local industrialists. We can make anything in the steel or fiberglass line and we are entitled to a share of the local business. Frankly, it is embarrassing to tell an Eastern customer that we only have one order from a commercial establishment in our own local area. .Are you willing to share the responsibility which should be that of the total community by taking a first step to provide a last chance to those who still have hope?" he challenged.

The lack of local response of which he spoke in that February speech persists today, the Albina president reports. "We have to convince local industry that we can do the job," Webb says, adding that he believes companies with Defense contracts should subcontract with Albina for items they may now be getting from out of State. It doesn't help business, he admits, that the region itself is not a major manufacturing area. "Although we find sympathy from the community, when it comes to the nitty-gritty, we have to cut the mustard like everyone else. Well," Webb corrected himself, "maybe we have to do it more so." He does hope that despite the obstacles more black manufac turing companies will develop but sees little sign of any upsurge.

David Nero, formerly head of Procurement and Contract Administration for the Battelle-Northwest Project of the Atomic Energy Commission and now Albina's vice president and marketing director, views the quality of Albina contracts to date with much reserve. An Army Captain until 1955, Nero calls most of the private contracts awarded Albina "teasers."

"I recognize in the experience so far that people are victims of the stereotype Negro. I assure you, most of the contractors are imbued with the stereotype that we can't deliver on time, for example-and it has to be overcome. How? We were given a stiff schedule by Texas Instruments (a contract for brass castings), but we beat the schedule by a week! When I flew down to the Texas office, I learned we could have had twice the order but the company had kept back half the order thinking they could at least depend on having half as many assured."

The stereotype has to be overcome within another of its victims-Government, Nero continued. If a contractor can show feasibility of his proposal, he believes that a Government agency should take another check among bidders to be sure that a company such as Albina isn't being overlooked. SBA should also lower its loan qualifications from 500 to less employees down to 100 or less or establish categories such as for a poverty pocket concern which might otherwise have the production capability but miss out because of its smaller size. "Under SBA regulations," Nero added, "subsidiaries of large companies have certain advantages which should not be denied companies such as Albina because of their independence."

"That's the nigger company," is the grossest instance of prejudice against Albina which Jack Perkins, consultant in charge of purchasing, traffic, and shipping,

Ron Green/Intermedia

has experienced since joining Albina in its first months. The company represented by the voice on the phone has not been rung up again. Other than this one case, Perkins, previously administrative assistant at a local steel fabrication firm, reports "as good or better" service and terms from local firms in a number of brackets: discounting, training films, delivery, credit buying. A company representative had asked Perkins last year, "What can we do to help?" We need about a ton of scrap metal for trainees to practice on, he was told. A few days later, a truck drove onto the site and dumped a pile of scrap metal that seemed to mount up, Perkins recalled, to just about a ton.

Of the 24 active contracts that Perkins services, about half have been won on low bid. The rest have been negotiated; that is, the price was set with Albina the only company considered because of its specific nature as a ghetto enterprise. A contract was lost on the latter basis, Perkins related, to an Indian tribe in Montana, indicating a certain amount of competition even among ventures established to rehabilitate poverty areas.

Nothing will come easy for Albina Corporation during the next couple of years. Webb speaks of "turning corners everyday" on the road to moving ahead in the profit margin, paying off its loans, establishing its independence from outright grant support, forming a cohesive workforce. As an observer remarked, Albina must move through the entire industrial revolution. Having done so, it will have shown that people with no previous ownership can build economic power through ownership of capital and their human input.

The success of the employee trust program will develop gradually. Its greatest significance will be established if the black employees actually assume control of the company. They have the legal powers open to them. In assuming control of the firm, Albina will have achieved a status of momentous political and economic consequence. This will be its key contribution to minority people. Not the only way out as Webb, Niedermeyer, and others admit, but another way of achieving independence for minority peoples.

That's what Albina is really all about, getting to the point where it can "cut the mustard" on its own. It will have proven something to a lot of people, or to pick up where Willie Garrett left off, that "black people can do anything right."

ARMANDO RENDON