Indigenous and Northern Affairs Committee on Nov. 19th, 2012

[Andrew Beynon]

I would only offer that there are some first nations that have indicated their support for these changes because they respond to the concerns about the speed and delays of designation processes.

Again, it's a discretionary provision. It's not an obligation on first nations.

[Carolyn Bennett, Liberal, St. Paul's, ON]

Do you believe there is an obligation by this government to consult first nations on things that affect them?

[Andrew Beynon]

I'm not sure if that's—

[The Chair, Conservative, Chris Warkentin]

Ms. Bennett, we have to be careful about what we obligate our witnesses to answer when they are civil servants. Obviously we want to be careful to respect their jurisdiction and their responsibilities.

[Carolyn Bennett, Liberal, St. Paul's, ON]

Their fearless advice, yes, and confidentiality.

Okay. That's fine.

[The Chair, Conservative, Chris Warkentin]

Thank you.

Mr. Wilks, we'll turn to you now for seven minutes.

[David Wilks, Conservative, Kootenay—Columbia, BC]

Thanks, Mr. Chair.

Thanks to the witnesses for being here today.

I heard you refer in your introduction to the elimination of the Governor in Council process and to allowing the minister to authorize land designation. I wonder if you could tell me about the opportunities in regard to time efficiency for first nations to move forward with economic development in that process, as well as whether you see anything that would hinder first nations from having the minister make that land designation as opposed to Governor in Council.

[Andrew Beynon]

I'll turn to the second part of your question first.

The existing system of federal approval for a designation is through the Governor in Council. The change in the legislation is only to make that federal approval through the minister. Quite frankly, I think that is seen as, and is, internal to the federal government.

To put a specific answer to your question, I can't think of any downside to first nations, to businesses, or to individual first nation members in the change from Governor in Council to the minister.

[David Wilks, Conservative, Kootenay—Columbia, BC]

With regard to the voting process as it's set out right now, it seems to me as though it's a system that in some cases is set up to fail. There's a dual process. It would seem as though we've put an onus on first nations to utilize a system that we don't utilize anywhere else.

Could you speak to that with regard to a majority versus majority, vis-à-vis the simple majority that is utilized basically everywhere else?

[Andrew Beynon]

The existing system specified in the legislation and the regulations—of going through one voting process at a high threshold and then having a discretion, which is usually exercised, to go to a second vote at a lower threshold—is very uncommon. In practice, as I said, based on the lessons we have learned, there is often a tendency to just go to that second vote.

I can't say that for sure, nor can I speak to what's in the mind of individual first nation members, but most people know these votes are likely to go to a second vote. There isn't a huge incentive to show up for that first vote because you could end up casting your ballot in the second vote.

[David Wilks, Conservative, Kootenay—Columbia, BC]

Would you agree that the majority of the majority vote is difficult, based on the fact that I assume you have to get a 50-plus-one result on every vote?

[Andrew Beynon]

Yes, it is difficult to obtain that high level of participation at the initial threshold.

To the earlier part of your question, the use of a simple majority to make a decision—the decision of the voters who participate in the vote, in other words—as proposed in the amendments in this legislation is a commonly-used practice. It's the level of vote, for example, for the selection of leaders in a first nation community election.

[Kris Johnson]

I'd like to add to Andrew's comments.

Part of your question dealt with a comparison to practices in other jurisdictions. The requirement for a vote at all is different from what most communities do when they're authorizing land use. A typical comparison for the designation process is the practice of zoning in many communities, where there's not a community referendum required.

Given the unique nature of reserve land, there has been put in place this requirement for a community referendum. Having a very high threshold for that draws it even further from the practice of other communities. At least simplifying the voting process to a simple majority brings it closer to, although it is still not equivalent to, the practices used by other jurisdictions.

[David Wilks, Conservative, Kootenay—Columbia, BC]

It certainly seems to me it would make it a fair process.

Mr. Chair, if I have any time left, I will turn it over to Mr. Clarke.

The last thing I have to say is that it seems to me these amendments being brought forward would work well for the majority of first nations, especially with regard to economic development.

I don't know where the other side comes on this, but it would seem to me the status quo is not an option. What we have now is just not working. Would you agree with that statement?

[Andrew Beynon]

Yes, I would tend to agree with that on these two points, on the difficulties of dealing with that high level of voting on the first vote, the delays that are encountered in having to go to a second voting process, and again, the delay that's experienced in going all the way to a federal approval through one of the highest mechanisms, such as the Governor in Council.

Changing these provisions still respects the fact that you do have to have a first nation community vote and still respects the notion that there is a federal approval. It just simplifies them and makes them less expensive and faster.

[David Wilks, Conservative, Kootenay—Columbia, BC]

If I have any time, I defer to Mr. Clarke.

[The Chair, Conservative, Chris Warkentin]

You have about 30 seconds, which is probably not sufficient to ask questions.

We thank our witnesses for coming today. We appreciate your testimony as well as your willingness to answer questions. We have another panel waiting, so we'll turn it over to them.

Thank you so much. We'll suspend, colleagues, and we'll keep it as short as we possibly can to allow us to arrange for our next group of witnesses. We want to make sure we allow as much time as possible for questions and answers.

In the next round, we have representation from the Assembly of First Nations, the Federation of Saskatchewan Indian Nations, the First Nations Tax Commission, the National Aboriginal Economic Development Board, and the National Aboriginal Lands Managers Association.

If all of you folks who are prepared to bring testimony from those organizations would approach, we can make sure this goes as quickly as possible. Thank you.

We'll now suspend, colleagues.

[The Chair, Conservative, Chris Warkentin]

Colleagues, I call this meeting back to order.

In our next panel we have representation from the Assembly of First Nations. We have Kathleen Lickers as well as Simon Bird.

From the First Nation Tax Commission, we have Mr. Jules. Thanks for joining us. You've been here before.

From the National Aboriginal Economic Development Board, we have another witness who has joined us in the past, Chief Sharon Stinson Henry. Thank you for being here.

As well, from the National Aboriginal Lands Managers Association, we have Wanda McGonigle. We also have Ms. Irons from the same organization.

Thank you all for being here.

We'll go in the order that follows our schedule and hear from the Assembly of First Nations first. Kathleen Lickers, perhaps you would like to begin with an opening statement.

We'll follow the list and then open it up for questions after that.

[Kathleen Lickers, Legal and Technical Advisor, Assembly of First Nations]

Thank you, Mr. Chairman.

Good afternoon to the honourable members of the committee, and thank you for the invitation to appear before you. I'll keep my remarks brief in the interests of my colleagues sharing our time.

I am an external adviser to the Assembly of First Nations. I have been providing them with legal counsel on the issue of additions to reserve and the reform of that process, as well as the specific claims reform.

I appear before you today to share the view of the Assembly of First Nations on the amendments. Our view is tempered by the process under which the amendments have come forward, but let me first share with you the view of the amendments themselves.

On the technical amendments to the Indian Act, we've read through the transcripts and the appearance of the minister before the Senate standing committee introducing the bill and the amendments in division 8 that are intended to streamline the designation process. It is a lengthy, costly, and oftentimes complex process to designate land, which is not the surrender of land, but the leasing of land. By all accounts, at the time at which it was introduced in 1988 it was, and is, commonly referred to as the Kamloops amendment, after the first nation that actually advocated for the change back in 1988. It is a process by to make lands for leasing purposes available to non-band members.

The amendments in the bill that speak to the separation of “designation” from “surrender” are a change that would do two things. First, it would improve the high threshold vote that is required by the provisions as they are currently written. Our colleagues who spoke from the department prior to this panel explained the two-tiered threshold of a majority of a majority on a first ballot, and if first nations are unsuccessful in securing that majority of a majority, that triggers a second vote. The separation of “designation” from that threshold would, in all likelihood, bring some efficiency and cost-effectiveness, frankly, to what is, as I say, an otherwise complex process.

The other elements that are far more technical in nature in this division 8 of Bill C-45 relate to the recommendation of the minister upon the vote having taken place.

Voting under the Indian Act must take place in accordance with its regulations. In the course of those regulations, there is the appointment of an electoral officer. The duties of an electoral officer are explained and detailed in the regulations themselves and include the giving of notice and the overseeing of the entire referendum process. It is after the results of the vote are known that the electoral officer is to sign a statement as to the validity of the vote, and that statement must also be signed by a representative of the first nation. What's technically changing in this amendment is that after that process the community must recommend to the minister to accept the results of the vote.

It was explained by our colleague, Mr. Kris Johnson, when he appeared before the Senate committee on November 7, that the amendment is intended to introduce a stopgap measure in terms of the community being in a position to signal to the minister that they are not prepared to recommend the designation result.

What's interesting about that, and I'm not suggesting anything hinges on it in this amendment, is that there are no amendments being introduced to the regulations themselves, so there is no displacement of the electoral officer in the process.

In fact, the referendum regulations do provide a review process that can be initiated by any community member who wants to challenge the referendum. They have seven days to do so. None of that process is being displaced in this amendment, but the minister can still disregard the designation vote, as it were, even by a simple majority.

The final change introduced by this amendment, again technical in nature, is the replacement of the Governor in Council approval of a designation vote by a ministerial order. We have seen this tool, the use of a ministerial approval in a designation process, through the use of pre-reserve designation in the claim settlements implementation acts that are available in the Prairie provinces of Alberta, Saskatchewan, and Manitoba. Those pieces of legislation were introduced purely to address the number of outstanding treaty land entitlement claim settlements that were occurring in those provinces in 2002.

The Auditor General of Canada has reviewed many elements of the implementation of those settlement agreements, but in the context of the use of designation under that legislation, it incorporates by reference the designation procedures of the Union Act, so in consequence that legislation will be equally impacted by the amendments that are introduced by Bill C-45.

What's important about that, which leads me directly into my remarks about the process—

[The Chair, Conservative, Chris Warkentin]

Ms. Lickers, we have gone over time, and I want to make sure we get your viewpoint, but I want to indicate that we are now into overtime—

[Kathleen Lickers]

I'm sorry, and I began by saying I was going to be brief.

Let me conclude by saying this: the process by which the amendments have been introduced runs completely at odds to the collaboration that the Assembly of First Nations is currently involved in with our colleagues from the department in the reform of additions to reserve. The very legislation that I speak of that will be impacted by these amendments, the claim settlements implementation acts, have been under discussion at that joint table in a collaboration to bring reform to additions to reserve.

As we come up to January and the first anniversary of the crown gathering, we question the journey that we thought we were embarking on together and the spirit of collaboration and cooperation that was promised.

Thank you very much. Those are my remarks.

[The Chair, Conservative, Chris Warkentin]

Thank you so much.

We'll turn now to Mr. Jules for his opening statement.

[Clarence T. Jules, Chief Commissioner and Chief Executive Officer, First Nations Tax Commission]

Mr. Chairman and members of the standing committee, it is an honour to be invited to appear as a witness before this committee again.

You are engaging in the important work of legislating first nations people back into the economy, which I support. I believe the proposed changes to the designation processes should lead to more economic development on our lands. I have served my community and people for the last 38 years as a councillor, chief, and leader. During that time, I've learned how the public and private sectors work together to generate economic growth.

The public and private sectors are dependent on one another. The private sector cannot sell its goods and services without adequate infrastructure, reliable service, and a legal administrative framework to protect its property rights.

The public sector cannot build infrastructure and improve services or create legal property rights and administrative systems without tax revenues generated from the private sector. In a successful economy, the public and private sectors support each other.

Unfortunately, this does not happen for first nations. We have a very small private sector; however, the road to fixing this lies in first changing our public sector. Hopefully, this brief story from my community will help explain why the proposed change is so necessary.

In 1988, as chief of my community, I led the first-ever Indian-led amendment to the Indian Act. The Kamloops amendment to the Indian Act, Bill C-115, created the term “designation” for lands that our communities wanted to use for economic development. The use of the term “designation” was intended to make it absolutely clear that a designation, previously known as a “surrender with conditions” or a “conditional surrender”, was in fact not a surrender at all. It was not to be confused with the surrender that involved giving up Indian interest in a part of a reserve.

As you know, with that amendment to the Indian Act, designations have been used by many communities and have helped generate millions of dollars of investment, have helped generate millions of dollars in property tax revenues, and have helped create thousands of jobs.

In 1993, again as chief of my community, we found out how difficult the designation process could be. We were approached by a developer who wanted to lease over 400 acres of our land to build a golf course and resort community. The development was to be called Sun Rivers. When completed, it would generate millions of dollars in tax revenue for our community and a number of employment and housing opportunities for our members. At the time, we believed that it would take two years to complete the designation process, complete the terms of the agreement, improve the infrastructure, and begin construction. We were far too optimistic.

The problem was that Sun Rivers was proposed for a site defined as band lands by the Indian Act. This meant that the land had to be designated for lease via the designation process set forth by the Department of Indian Affairs. That process requires a review by the department to ensure that the government is not exposed to any liability. Unfortunately, investment is all about weighing risks against expected returns.

Sun Rivers looked very good, but, like any investment, it was not risk-free. Because the federal government was risk-free, they wanted to define the “use” clause in the designation quite rigidly. Because our goal was to maximize the return, subject to our risk tolerance, we and the developer needed more flexibility. This disagreement led to a lengthy and consequently more costly designation process.

This difference in goals also put much more onus on the developer than would be typical in a non-first nation setting. They had to provide information materials and presentations to the community, detailing the plans for the development. We believe in informing the community and ensuring proper planning; however, the excess in this case added $200,000 to the developer costs over what would have been typical for a community.

During the designation process, we also unexpectedly received a concern from the Department of Fisheries and Oceans. They had looked at the proposed development from their offices in Vancouver and determined that the development would put spawning beds at risk. This was rather a surprising delay, since the proposed development was on a benchland that hadn't had a stream on it for hundreds of years, let alone any salmon. For those familiar with the Kamloops area, you will know that its annual rainfall puts it in the desert category.

Unfortunately, these geographic and climate factors are not obvious from looking at an aerial photograph in Vancouver. As a result, this caused another unnecessary delay in our designation process. We were, however, able to communicate the merits of the development to our membership, and 74% voted in favour.

After crossing the designation threshold we had to do three things. One, we had to create a legal and administrative system that provided sufficient property rights certainty to the developer and eventual residents. In the municipal context, this would have already been available.

Two, we had to reach a service agreement with the City of Kamloops and the developer to ensure high-quality infrastructure and local services were available at Sun Rivers.

Three, we had to ensure that we could work with the federal government so that lease transfers could be processed at the speed of business as opposed to the speed of government.

The Indian land deeds registry is not as efficient as the Torrens registry system in the rest of Canada. As a result of the added burden implied by the existing designation process, construction did not start until late 1998, a full two years later than expected, at a cost to us and the developer that exceeded $2 million.

If you are looking for an explanation as to why there is so little development on most first nation land, then this story should illustrate why. Simply put, in those days it took an average of four to six times longer and was five times more expensive to do land development under the Indian Act than off-reserve. The challenges of reducing these costs and reducing first nations poverty are one and the same.

I've got another story, but I'll leave it in the interests of time.

In this system under which we've lived for generations, as my father has said many times, we vote for chief and council but we don't vote for bureaucrats who actually determine our lives.

The proposed amendments to streamline the designation process are a step in the right direction. At the very least, the designation voting requirements should be the same as in other governments in Canada, where the majority support is sufficient. Accordingly, I support the amendments to the Indian Act as contained in Bill C-45.

[The Chair, Conservative, Chris Warkentin]

Thank you, Mr. Jules.

We'll now turn to Chief Sharon Stinson Henry.

[Chief Sharon Stinson Henry, Member, National Aboriginal Economic Development Board]

Thank you.

Aaniin kinaweya. Good afternoon, everyone.

[Witness speaks in her native language]

My name is Sharon Henry Stinson. I'm the chief of the Chippewas of Rama First Nation in Ontario, but I'm appearing before the committee—and I thank you for hearing me today—as a member of the National Aboriginal Economic Development Board.

The National Aboriginal Economic Development Board, as you may know, is a federal advisory board created in 1990 to provide strategic policy and program advice to the federal government on aboriginal economic development. The board brings together first nations, Inuit, and Métis community and business leaders from all regions of Canada to advise the federal government on ways to help increase the economic participation of aboriginal men, women, and communities in the Canadian economy.

Today I am pleased to offer information that may assist the committee in your study on the subject matter of clauses 208 and 209 in division 8 of part 4 of Bill C-45, which proposes to amend the Indian Act to modify the voting and approval procedures in relation to proposed land designations.

I would also like to offer the national board's views on these modifications and why we believe the proposed changes could go further, such as by providing first nations with additional leeway to amend the term and use of designations when circumstances change. At the board's last appearance before this committee in March of this year, we noted a range of challenges to creating strong economies on reserves, many of them related to the land management processes under the Indian Act, which are all too often expensive, complex, and extremely slow, resulting in missed economic opportunities.

This year, the National Aboriginal Economic Development Board conducted case studies of three first nations. These case studies provide solid evidence of this reality. The three communities that were examined were the community of Membertou in Nova Scotia, the Osoyoos Indian Band in British Columbia, and my community of Rama First Nation. We have all achieved relatively high degrees of economic success despite operating under an antiquated system that was never designed to allow for a range of economic opportunities such as we are seeing across the country today.

With respect to the proposed amendments to the Indian Act under consideration by this committee, our case studies reveal the following. Some of the panellists have already spoken to some of these issues, but I'll repeat them.

First, designation votes cause first nations to lose both time and money. To conduct a designation vote, a first nation must invest a significant amount of time and money to inform all of its members, both on and off reserve, about the vote. We must ensure that they have adequate information to make an informed decision, to hold meetings, to develop communication materials, and, finally, to conduct the vote.

For example, in Osoyoos a designation vote was conducted in 2008 for the Senkulmen project to set a designation length of 69 years and allow for light industry uses in the park. It cost Osoyoos $50,000 and took nearly five months to conduct that vote.

Later, to allow the band to seize an energizing economic opportunity to build a $250 million correctional centre, Aboriginal Affairs and Northern Development Canada and the Department of Justice insisted that Osoyoos conduct a second designation vote for the same parcel of land to change the lease period and allow for institutional tenants. The second designation cost the band an additional $20,000.

In total, the federal government's designation and leasing requirements caused Osoyoos to incur $150,000 in expenses.

Second, designation votes put existing economic activity at risk. Any amendment to the purpose and term of a designation requires an additional vote by the electors of the first nation involved. Communities do not have flexibility to change the duration or purpose of land use as economic opportunities present themselves or continue beyond the term of the original designation.

For example, the land in my community on which Casino Rama is located has a designation term. When that term expires, under the terms of the Indian Act we are to conduct another referendum to approve the future designation of those lands. This puts us at a $30 million net revenue risk.

That is unacceptable. Imagine Canada having to hold a referendum every 40 years on the location of the Parliament Buildings. Now imagine all the local businesses who have built their future on the location of these buildings and leaving their future up to a referendum. It is disruptive to the community and the economy. If you had to go through a referendum every 40 years or less—20 years in some cases—on the land you sit on today, that is unacceptable as well.

In conclusion, the national board is supportive of the overall direction taken in Bill C-45, to this extent: first, we agree to the proposed amendment to Bill C-45 to reduce the voting threshold to a simple majority, as has been mentioned. However, the board is of the opinion that the bill should go further and eliminate the need for a second designation vote when changes to the lease or the use of the land are required.

Second, while the national board supports any measure that will streamline the designation process, such as the proposed amendment to allow the Minister of Aboriginal Affairs and Northern Development rather than the Governor in Council to approve the land designation upon receipt of a band council resolution, the board would like to impress upon the committee the need to further modernize the Indian Act's land management regime. For example, the designation processes should be more similar to the process by a municipal authority to designate or zone land for a particular use. I heard that mentioned earlier as well.

Assuming that a comprehensive community plan exists, the use of costly and time-consuming referenda for decision-making should be limited. First nations that are willing and able should be provided with tools to free themselves from the bureaucratic gridlock that emerges due to the federal government's risk-averse approach.

On a personal note, I recommend that the committee seriously consider eliminating or removing the word "surrender" from the Indian Act and using the word "transfer", if anything. It's unacceptable to use that term.

Voting has already been mentioned in the discussion by the panel. First nations need to have a simple majority, as other communities do in their processes. For heaven's sake, we're not even allowed to have addresses of our voters, if you can imagine, to reach them to give them the information they need to make an informed vote.

I could go on and on, but I won't, in the interest of time.

Thank you, Mr. Chairman, for your invitation to be here today.

Meegwetch. Thank you.