goal for all concerned than to have further fragmentation of the private ownership of land in southeast Alaska through uncentralized regional selections. In the event of an adverse ruling on this issue, the act could easily be amended by simply providing that hardship selections may be exercised in the withdrawal areas and within national forests.

I am positive that as time progresses, some of the problems could be solved other than by legislation if the Federal agencies involved are more responsive to the spirit and intent of determining how it can best be construed so as to limit or restrict our rights. This is in my opinion not a proper method of implementing the act. I do not believe that the Congress intended that this should happen.

In conclusion, as a result of the passage of the Alaska Native Claims Settlement Act, attributable in large part of your highly principled efforts, Mr. Chairman, the Natives of Alaska became the future owners of land, money, and resources of the land. We approach no agency of this government with that in hand. We demand no more than that which is ours. We will fight to retain the benefits clearly intended by the act, just as we fought for the passage of the act in the years prior to

1971.

Because agencies can issue rulings administratively that can reduce the extent of our claims rights, I feel that what was previously considered to be purely in-house issues in the agencies, such as agency work schedules, budgets, priorities, et cetera, all affect the implementation of the Claims Act. One of the biggest barriers that we Natives will face will be largely attitudinal-an instinctive resistance by agencies to the issuance of administrative decisions that either favor or accord equal treatment to the Alaska Natives. This must not be allowed to nullify the promise set forth in this landmark legislation. To do so, would be to convert a bright tomorrow to another shattered dream for the first Alaskans.

We have present with us today a cross-section of village residents who will address themselves to some of the problems facing the southeast Alaska village corporations and how possibly the conflict of interest faced by the Department of the interior may be diminishing the benefits of the land claims.

This concludes my formal statement, Mr. Chairman, and I would be pleased to answer such questions as you may wish to ask of me. Mr. MEEDS. Thank you very much, Mr. Borbridge.

My first question is this: Do I understand your testimony to indicate that in the event the bill were passed in its present language as soon as the Secretary's obligations under the Claims Act for disbursement of land and moneys under that act was terminated, he would no longer have any trust responsibility to Alaska Natives?

Mr. BORBRIDGE. Yes.

Mr. Chairman, we are encountering more and more of this type of interpretation. We, for example, with respect to the land, have certain restrictions on alienation over a period of 20 years, but that once the responsibilities of the Secretary have been carried out we are told we will then encounter more interpretations which would seem to present the thought that this would largely end the trust responsibility with the Alaska Natives.

It was largely the intent of the representatives of the Alaska Natives during the lobbying attendant to passage of the act that there should not be an end to this trust responsibility, and the Alaska Natives are firmly on record as being opposed to the termination of such a trust responsibility.

Mr. MEEDS. Indeed, as I recall the act it specifically states that it is not in derogation of other responsibilities the Secretary owes—not in that kind of language, but maybe counsel can find it for me.

It is right in the beginning of the act, about a continuing responsibility.

Well, I certainly wouldn't want this act interpreted or my intent to be interpreted that this responsibility is to be diminished either by the passage of time of by fulfillment of other obligations.

The Alaska Native people are still Indian native people subject to most of the same rights as other aboriginal people in their dealings with the Federal Government.

With maximum participation by the Natives in decisions affecting their rights and property, which we will talk about a little later, "without establishing any permanent rationally defined institutions," et cetera, "no provision of this Act shall replace or diminish any light, privilege, or obligation of Natives as citizens of the United States or of Alaska, or relieve, replace, or diminish any obligation of the United States or of the State of Alaska to protect and promote the rights or welfare of Natives as citizens of the United States of Alaska."

Let me assure you, Mr. Borbridge, we will be very careful about that, and if we pass the legislation we will certainly take care of that potential problem.

On page 5 of your testimony you talk about the problem of certain small villages, the so-called unlisted village.

First of all, I would appreciate it if you will refresh my recollection on the act, the Alaska Native Claims Act with regard to the unlisted villages, and secondly, if you would explain why you think the Department has taken the position they appear to be taking with regard to those villages.

Mr. BORBRIDGE. I will ask with your permission to have our attorney present so that he may assist in laying the background for the provision we presented for unlisted villages.

But you can say that generally speaking, Mr. Chairman, there is provision within the act which broadly provides for the inclusion of unlisted villages based largely on the premise that during the drafting of the claims legislation that there may have well been inadvertent mistakes made with respect to villages which would generally qualify were not included within the list of villages either under section 11 or section 16. In order to make provision, therefore, for the inclusion of villages at a later time, provision was made that if villages not listed met specific criteria, which criteria were specifically set forth in the land selection regulations promulgated by the Department, then those villages could well be included.

The concern we have is that we recognize there is a very clear language providing for unlisted villages. However, it also appears, at least informally, that the Department is making a distinction which has not been formally transmitted to us, indicating that they have doubts that southeast Alaska and Sealaska as such could qualify and

be able to exercise right under the provision that allows for unlisted villages.

I would like to ask Mr. Beighle, our attorney, to comment further on this.

Mr. BEIGHLE. Mr. Chairman, I think the basic problem with reference to unlisted villages is a matter of interpretation of the act. If you take one construction there is no question that villages in southeast, unlisted villages, can qualify.

Mr. MEEDS. What construction is that?

Mr. BEIGHLE. Merely that the act provided for unlisted villages to qualify if they meet certain criteria. If they meet the criteria then they should qualify and be entitled to land benefits.

Mr. MEEDS. That is pretty clear language of the act; is it not?

Mr. BEIGHLE. It seems to us, Mr. Chairman, but I have asked the Solicitor's office for a provision on the issuing and have not reecived one. They have not taken the position we are entitled to qualify unlisted villages in southeast.

Mr. MEEDS. Because of the previous settlement on the Tlingit-Haida case?

Mr. BEIGHLE. This is one of the reasons, yes, but taking the interpretative language of section 13 (c)

Mr. MEEDS. Well, that is very disturbing to me, because as one of the people most involved in the act, I have no recollection at all that any distinction was to be made with regard to unlisted villages in southeast Alaska. The qualification criteria for qualifying for unlisted was to be the same all over Alaska.

Mr. BORBRIDGE. You are perfectly correct, Mr. Chairman, because as a part of our lobbying efforts we reached a position within the Alaska Federation of Natives as we were advancing the native position that this would be applicable across the State of Alaska, and I don't recall at all during any of the testimony or comments that were advanced during the consideration of the Alaska Native Claims Settlement Act that any distinction was ever proposed or ever discussed. I am primarily concerned at this time that this could be another example of deprivation by administrative ruling, which ruling would probably not be subject to as much public scrutiny as legislation itself

Mr. MEEDS. Thank you.

Would you have your counsel set this forth a little more specifically in writing a letter to me so I can make some inquiries of the Department on this specific question, please?

Mr. BORBRIDGE. We would be very happy to have that done, and it will be done, Mr. Chairman.

Mr. MEEDS. Yes, with a copy to the gentlemen from Alaska, if you will, please.

Now, Mr. Borbridge, I would like to question you with regard to your testimony on page 11. As you are well aware, I come from a State where the wood products industry is a major industry, and I am also very concerned that in parts of Alaska-particularly in southeast Alaska where there is a very good wood products potential—this be one of the industries in which the regional corporation, the villages or individuals who are of native or Indian heritage could participate, you tell me that we may have some roadblocks here.

Would you like to elaborate on that?

Mr. BORBRIDGE. With your permission, I will ask our engineer, Mr. Allington, who has been right on top of this to explain some of the background and what some of the attendant problems we anticipate

are.

Mr. MEEDS. Specifically, I am concerned about the legislation, again, the Alaska Native Land Claims Act.

As I recall, there would be some regional selection for the Sealaska Corporation, so I would like to know, one, could that regional selection be used to take forest lands, and, two, is there any way that the Sealsaka Corporation could combine in one overall venture two or more of the selections of the individual villages for a regional operation benefiting all the villages?

Mr. ALLINGTON. Mr. Chairman, our indication is that on a sustained-yield basis we can expect between 2 and 3 million board feet a year of the 20 million-plus acres around the village.

Mr. MEEDS. Each?

Mr. ALLINGTON. Yes, sir; but these are scattered throughout southeastern Alaska, so that, in order to have a mill operation, you cannot take one mill and operate all of them, at least not on an economical basis.

It was our hope, and we still hope that we can have regional lands selected adjacent to the individual village sites so that we can have a larger area, something more than the 23,000 basic allotted to the villages so that the cut area could be larger and the yield big enough to sustain a mill in more than one location.

Mr. MEEDS. May I interrupt to ask again, was that 2 or 3 million board feet?

Mr. ALLINGTON. The information that was given to us informally by a Forest Service representative is that we could expect to cut between 2 and 3 million board feet a year of a single township in southeastern; yes, sir.

Mr. MEEDS. And you have, as I recall, what, 13 townships?

Mr. ALLINGTON. At the present time we have 10 villages and two groups. So that would be 12 townships that could be cut.

Mr. MEEDS. That would hardly sustain more than one well-located mill.

Mr. ALLINGTON. Some informal information we have gathered is that a good, efficient mill would require not only all of the village and groups entitlement, but Sealaska as well in order to sustain a good mill.

Mr. MEEDS. How much is Sealaska's entitlement, how many acres, do we know?

Mr. ALLINGTON. It appears in the vicinity of about 200,000 acres on the hardship that is proportional distribution, and it can't be set down at the present time. It will have to be determined later.

Mr. MEEDS. Is there anything in the act prohibiting a combination like the one about which I spoke?

Pardon me just 1 minute. I see we have a distinguished visitor, our colleague from the other side. Come on forward, Mike.

We have just been joined by the distinguished Senator from the State of Alaska who has just come from a very victorious effort with regard to the Alaskan pipeline. We are delighted to have you with us, Mike. We hope you can stay a while.

Senator GRAVEL. Thank you, Congressman.

Mr. MEEDS. We are just discussing the ability of Sealaska Regional Corp. to combine efforts of a number of the village corporations with regard to some kind of wood products industry in the approximately 12 townships and approximately 200,000 acres that Sealaska would be entitled to in this area.

Mr. ALLINGTON. Mr. Chairman, if I may, with your permission, this is more of a legal question and I would like to have Mr. Beighle answer it.

Mr. MEEDS. That reminds me of the story that Senator Ervin tells, when you said you would like to have Mr. Beighle, your attorney, answer it. Sam Ervin asked one of his constituents down in Carolina whether so-and-so was an attorney and the answer was not much of one. I am sure Mr. Beighle is a good attorney.

Mr. BEIGHLE. Almost passed the microphone back.

In answer to your question, Mr. Chairman, I think the act does make provision on a consensual arrangement where everybody has agreed for grouping of these things and proceeding under one flag, so to speak.

Mr. MEEDS. Very good. Well, I hope that is being looked at very closely.

Just one last question, Mr. Borbridge with regard to the problem of taxation. It seems to me that section 21 (a) of the act clearly prevents any kind of imposition of tax on funds received under this act. I quote 21 (a):

Revenues originating from the Alaska Native Fund shall not be subject to any form of Federal, State or local taxation at the time of receipt by a Regional Corporation, Village Corporation, or individual Native through dividend distributions or in any other manner. This compensation shall not apply to income from the investment of such revenues.

Is it your feeling there will be a commingling of investment of revenues and the revenues themselves so that they would become clouded and they would all be subject to taxation?

Mr. BORBRIDGE. With your permission I will have our attorney respond to that and we will explain the background, and he is much of an attorney.

Mr. BEIGHLE. Mr. Chairman, the basic problem is that the Alaska Native Fund moneys, a portion will be paid probably direct into a trust act and then distributed and a portion retained.

Earnings from those again require the mandatory distribution to a village corporation. If we are required to pay the corporate tax on those earnings prior to making the mandatory distribution to the village corporation and then the village corporation is required to pay the tax as receipt, as income to them and so on, I think any income earned by the regional corporations will be diminished by the time that gets to the recipient.

If the mandatory distribution is treated as a business expense, then it is not taxed at the regional level. This would, I feel, fit within the confines of the present Internal Revenue Code.

Mr. MEEDS. So you are suggesting that the income received by the regional corporation be treated as an expense when it is distributed rather than as income when it is received by the villages.

Mr. BEIGHLE. Yes; only as far as the mandatory distribution is concerned and the reasoning there, Mr. Chairman, is that the law dictates or requires that we pay it. It is an expense of the business. Mr. MEEDS. An established percentage, too, isn't it?