The "Northwest American Republic" is a fictional construct created by Harold Covington, a long-time fringe figure in the neo-Nazi movement. The flag for this fictional nation is used by Covington as a symbol for his own group, the Northwest Front.
The "Republic" and its flag are based on the so-called "Northwest Imperative," a longstanding call by some white supremacists, including Covington, for white people to move to the Pacific Northwest and establish their own country there. Covington has promoted this idea on the Internet and in various novels.
Covington, ostracized by most of the white supremacist movement, has few followers, but has a significant Internet presence that can catch the attention of would-be white supremacists.