The Calista Corporation’s annual meeting is coming up, and shareholders will weigh in on whether or not the organization should create an Alaska Native Settlement Trust.
"There are several key benefits," explained Calista spokesperson Thom Leonard. "One is that shareholders would not have to pay taxes on their own dividends in the future."
Leonard says that settlement trusts are a relatively new phenomenon. Like other Native corporations, Calista received tens of millions of dollars from the federal government when it was created, and the corporation has been making distributions of some of that capital to its shareholders ever since. By the year 2021 or so, the corporation anticipates that dividends will be coming from Calista's earnings, which would be subject to federal taxes.
If Calista shareholders approve a settlement trust, says Leonard, shareholders will avoid that. The taxes would be paid by the trust, which will be able to pay federal taxes at a lower, 10 percent rate. The funds that Calista puts into the settlement trust would also be deductible from its federal taxes.
Several Native corporations have already formed settlement trusts, including the Old Harbor Native Corporation and the Ahtna Regional Corporation. A settlement trust requires a majority vote. This year's Calista annual meeting will be held in Bethel on July 6.