Goldbelt eyes profits in IRS vehicle deal

Native corporation wins $4 million contract to provide specialized vehicles for federal agency

Posted: Tuesday, November 16, 2004

Harbor fee hearings

Who: The Docks and Harbors Board will hold a public hearing on the proposed port fee changes at 5 p.m. Thursday in the Assembly chambers.

The board will hold a public hearing on the regulation for inactive vessels at 5 p.m. Wednesday at the city conference room 224 and at 7 p.m. Dec. 2 in the Assembly chambers.

Send comments to Port Director John Stone at 155 Seward St. or call him at 586-0292.

ANCHORAGE - The Internal Revenue Service could prove a profitable client for an urban Alaska Native corporation best known for its tourism-based businesses.

CP Leasing Inc., a subsidiary of Juneau-based Goldbelt Inc., has won a $4 million contract to provide specialized vehicles to the federal agency.

CP Leasing - doing business in Washington, D.C., as Goldbelt Wolf - anticipates 2004 profits in excess of $400,000, primarily from its vehicle leasing activities, said Gary Droubay, president and chief executive officer.

CP Leasing has about 250 vehicles leased to government agencies around the country, including the IRS, under package deals that include delivery and maintenance, Droubay said.

That includes several dozen Dodge quad-cab pickup trucks used by the excise tax division of the IRS to inspect on-road and off-road use of vehicle fuel. Vehicles using diesel fuel to drive on roads have to pay the excise tax, but off-road vehicles do not.

The leased vehicles are used in every state but Alaska, Droubay said.

There are also several other vehicle leasing deals in negotiation at this time, said Droubay, who is also president and chief executive officer of the parent firm, Goldbelt Inc.

CP Leasing negotiates agreements with various federal agencies, then buys the requested vehicles under a fleet purchase contract from a dealer.

"The manufacturers give us fleet incentives, so we can buy fairly cheaply," Droubay said.

Once the lease expires, CP Leasing takes the vehicles to a dealer for a complete inspection report, and then to the auction block, he said.

"Basically, if we make more money than what we owe on the vehicle, we have a gain," he said.

Goldbelt Wolf acquired its first IRS leasing contract in 2001 because of its status as an 8(a) firm under the Small Business Act of 1998. The 8(a) program was designed to help eligible small businesses compete by allowing them to contract directly with the federal government, or subcontract with larger businesses that have federal contracts.

To encourage federal contracts to small businesses, the government established goals for percentages of agency budgets to be expended through small businesses. Alaska Native corporations and companies that are majority owned by Alaska Native corporations are eligible for 8(a) status.

Goldbelt formed an 8(a) company in 2000, and four more in 2002 and 2003. In each case, while retaining majority ownership, Goldbelt has offered minority ownership to other companies or individuals with expertise in the area of business to which each company is devoted.

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