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FARE-talk is to provide an enduring conversation about contemporary topics relevant to food, agricultural, and resource economics.

First Nations Lands and Economies - September 13th, 2012


Brady Deaton Jr.: Welcome to FARE-Talk where we set out to provide enduring discussions on contemporary topics relevant to our economy with particular emphasis on food, agriculture, and the environment. My name is Brady Deaton, Jr. of the Department of Food, Agriculture, and Resource Economics at the University of Guelph. I'll be your host.

Today Chief Robert Louie and I will be discussing the management and control of First Nation's land with particular focus on the Framework Agreement on First Nations Land Management. Chief Louis is the Chief of the Westbank First Nation. He is the Chairman of First Nations Land Advisory Board since 1989 and a member of the Order of Canada.

Welcome to FARE-Talk, Chief Louie.


Chief Louie: Thank you very much Brady. It's a pleasure to be here.


Brady Deaton Jr: I want to begin by mentioning something that's on the Land Advisory's Board website and have you kind of discuss it; and there's a statement there that's very powerful. It says, "For the first time in history of First Nations, we'll gain a window of opportunity to have the power as a Nation to manage its reserves, lands, and resources, and eliminate the bureaucracy of Justice and Indian Affairs." Talk to me a little bit about that.


Chief Louie: Well, it's extremely important for First Nations across this country that First Nations be recognized with inherited right to manage their own lands and resources; and for us this land management process and the implementation of land codes does exactly that. It recognizes the jurisdiction. It recognizes that First Nations are the lawmakers on their own lands, that they have the power to make laws over their lands and their resources; and that's fundamentally important. And it is the first time in the history of Canada, that such an accomplishment has occurred. First Nations were historically self-governing before the Europeans came to Canada, and now with Land Codes and with the Frame Agreement initiative, it recognizes that First Nations again have the jurisdiction to look after their lands and their resources.


Brady Deaton Jr: I think there's two big terms that will probably be used a little bit interchangeably, but I wouldn't mind if you could just unpack them a little bit. There's the Framework Agreement, and there's the First Nation Land Management Act. The Framework Agreement, of course, come into being in 1996. And the Land Management Act is in 1999, I believe. Talk to me a little bit about the difference between those, and how they came into being.


Chief Louie: The Frame Agreement is a government to government agreement that was negotiated by the First Nations and with Canada. And that Frame Agreement, back in the 1996 timeframe, at the time of signing, sets for principles that recognizes First Nations to have the inherited right to do such things, as manage their lands and resources. It talks about principles to protect lands, so reserve lands cannot be sold. It recognizes that third party interests are going to be protected. Principles of that nature. It's a fundamental document that set for strategy and set for the process, so that government could eventually pass its legislation, and that legislation was passed in 1999, the First Nation Management Act.

By Canada passing that legislation, it ratify the Frame Agreement. What's unique about the Frame Agreement and the First Nation Management Act is very simple. It says and it recognizes that unilateral changes cannot be made without the consent of the other party. That's fundamentally important from the First Nation perspective, specially when we're looking at how laws are developed and the negotiations that took place to put forces [inaudible 00:03:54]. That's very, very important and it's very unique in Canada.


Brady Deaton Jr: The process leading up to the Framework Agreement it's quite interesting. It's something that emphasized discussions of the First Nations Land Management Act. The Westbank First Nation was one of the original signatories, what was that process?


Chief Louie: In the early 1990's, and even going back to the late 1980's, there was a movement by First Nations at ... We had to see the recognition of the inherited right of First Nations recognized. We had the constitution that was passed prior to that. It's spoke of, in section 25 and section 35 in that constitution, spoke of the inherited right of First Nations, but it wasn't implemented. This was a very serious contention by First Nations.

When government look at, and it was about time of the changing government, it was the election process in the early 1990's that led to the liberal government, who wanted to come into power. They said to First Nations in their background, in the election process, saying that we would want to have First Nations recognized with certain inherited rights. We capitalized on that. Our process was "Let's do that", to do that we needed to get ourselves out of the Indian Act.

We worked with the government when it became government and we negotiated the Frame Agreement. That really was the starting point to say, "Yes, there is a process, and if the government says they would support it, then, let's see the reality of it." The reality of it was the Frame Agreement and the eventual passage of the First Nations Land Management Act legislation. Of course, since then we have been [inaudible 00:06:09] First Nations who have passed land codes, who were now self-governing to the extent that they can now manage their lands and their resources.


Brady Deaton Jr: How many First Nations have opted in to the Framework?


Chief Louie: Right now we have 37 First Nations to actually become operational, that have passed land codes and are fully operational. We have 25 that are in the developmental phase today. We have a total of about 83 First Nations on the waiting list to become involved. When we add up all those figures, it boils down to about one in six First Nations in Canada are either involved or want to be involved in the Land Management.


Brady Deaton Jr: What are the steps if a First Nation wants to basically enter into the Framework Agreement? What are the steps by which that would be done? I wanna talk in a minute about the Indian Act, because I think that's important. If you wanna to move out of the Indian Act into the Framework Agreement what generally are the steps that First Nations would undertake?


Chief Louie: The First Nation that is interested in this process first of it has to have the genuine interest. And that interest would normally, and usually comes from the council of the First Nation. It has interest, it's heard of the Land Management initiative through one process, step, or another. It says and it feels, "Yes, this is something that could work for our community", that First Nation would then look at passing a bank council resolution to set the process, to say, "We have interest, we'd like to become involved, we have interest here, accept our resolution saying that we have that interest, it's signed that we wish to proceed."

Now, in the recent years, last couple of years, government of Canada has said, "well, that's fine, but now we have to go through a process, you're going to have to fill out some application forms and let's take a look at all of the varies things that have to now be considered. Are you in third part management for example, do you have economic development needs, do you have any environmental issues or matters of serious concern, are you [inaudible 00:08:30] Canada?" Questions of that nature.

Then Canada, once it has that application, will make a decision. It has the control, if you to will, to accept or reject the First Nation now coming into the process. If it accepts that First Nation, then that First Nation is recognized "Yes, you will now have an opportunity to participate when the funds and when time permits."

Recently, in the Spring of 2000, the minister of Indian Affairs accepted to have that [inaudible 00:09:07] of First nations, another group, 18 new First Nations, from coast to coast, were then agreed upon to enter into the land measurement process. That opened the doors for those 18 First Nations. They're now in the developmental phase of their land code development.

We still have many other First Nations for waiting. You can appreciate that cost money to have First Nations in developmental process. Canada has to set aside those [inaudible 00:09:38] and has to budget it. Right now, we're under certain budget constraints. Even though that we have KPMG studies, and studies of that nature, that suggest and support the fact that if a First Nation becomes operational, we can show and demonstrate through past history and review of the economical findings that that First Nation is going to bring a return to the investment into that First Nation going into developmental phase. It's been estimated that at least 10 times the return on that investment. By Canada investing into the First Nations to support them to become operational. Once it becomes operational, 10 times the return of the investment. And those investment returns grow every year.


Brady Deaton Jr.: Do the First Nations vote on whether they want to accept the new developed land codes? How is the community participation in this process?


Chief Louie: The community is very, directly involved. To [inaudible 00:10:40] the process is one thing. Then the First Nation, once it's gained entry into the developmental phase, it has to go through an internal process of ratification by its members of their land codes. Land Code is the laws that the community sets that follows the principles of the Frame Agreement and follows the legislation. That has to all be put together and the community is involved in that process, step by step. Both on reserve and off reserve. Any First Nation that has a minimum of 18 years of age and older and confident to vote is eligible to be involved. The First Nation community deals with all of its community member, which is out to everyone of the voting age and its able to vote. And says, "let's now make a decision. Do we do a majority of vote or ratification vote?". That community has to decide.

The fact is that every First Nation member of that community has the right to vote, and it's encouraged to vote. That First Nation community must provide all of the information that is necessary for that individual member that's going to vote to make that informed decision. If it votes, if that community votes, "Yes", in effect you'll have a ratified land code. If it rejects the land code vote, of course, there is non entry into the operational phase.


Brady Deaton Jr.: I think many of our listeners will be less familiar with the reasons why a First Nation might want to move and develop its own land code, instead of following the land code set forward in the Indian Act. I really appreciate and I think it'll be really helpful, could you just step back and discuss the Indian Act and why that constraints First Nations in a number of ways, including maybe economic development?


Chief Louie: First Nation clarified that the Indian Act, that legislation is not allowed for land codes to take place. What the Indian Act does, and it's done so historically ... there're basically 34 sections in the Indian Act that deal with one form of administration over lands and resources. The fact is that the Indian Act divides the ministry of Indian affairs, the government general, the department of Indian Affairs has all the powers and controls over the First Nations' lands and resources. Yes, First Nations can have certain bylaws. But bylaw is a subset of laws that exist in Canada through the department of Indian Affairs.

There's no inherited right that's recognized. If, for example, a First Nation say "Look we need to have a dog parking bylaw", it's jury can pass that bylaw in the chambers of the council, but that council must submit it to Indians Affairs for their approval. It's not ratified or approved, unless the Department of Indian Affairs says it can be ratified.

This is totally different from a land code. A land code is such that it recognizes the First Nation as a law maker. It has the jurisdiction, without seeking permission of the department of Indian Affairs, minister or anyone else. It has the power to do things that is necessary to manage its lands and resources. Those powers are very, very extensive. For example, how development takes place, how leases are registered, how deep you put the water lines and the sewage lines, what are the building code restrictions, how it's going to be developed, how is the process going to take place as far as a law making, is it going to be first, second and third readings in the passage of laws.

All of those matters that are [inaudible 00:14:36] to government falls into the hands of the community. It makes the community the decision maker, the jurisdictional body, who determine the affairs of the First Nation that affects its reserve lands and resources. That is absolutely, total differentiation between the Indian Act, how it's administered, how the First Nation would act with its land code in place.


Brady Deaton Jr.: We're discussing the Indian Act, just to be clear, the Indian Act and the Federal Government doesn't currently allow First Nations to basically self-govern with respect to land. My understanding of that's correct?


Chief Louie: That's absolutely correct. The Indian Act, the way it was developed back in the 1860's, 1870's, and amended from time to time, strictly recognizes the authorities of the government of Canada as represented by the governors, general or the minister of Indian affairs, or his or her agents to make the decisions over the affairs of the First Nation. The First Nation has certain capacities, that have been allowed under the Indian Act to make certain bylaws. But those bylaws, for example, must be approved by Canada through the department of Indian Affairs. In effect, there's no self-government recognition, no inherited right is recognized by First Nations.

First Nation peoples are seem really as [inaudible 00:16:08] of the government, they're seem to be communities that must be supported by government, and that includes all of the affairs and the decision making. There is a complete difference between the Indian Act process and the land code and land measurement process that were currently discussed.


Brady Deaton Jr.: Under the Framework Agreement, does the land still though remain under Federal protection?


Chief Louie: Yes, it does. With the land code in place, the First Nation chiefs, at the time of conception of Frame Agreement, had agreed, and Canada agreed with those First Nations that the land would remain, what is referred to as section 91 (24) lands, that's 91 (24) of the constitution of Canada. It really recognizes the federal domain. The First Nation work within that federal domains. The provincial government has no law making capacity on the reserve, in so for as lands and resources are concerned, and that was the wishes of the First Nations at that time, in the mid 1990's, and remains the wishes of the First Nations today.

It's very clear that the 91 (24) jurisdiction is the process that's been supported by the majority of First Nations in Canada. Almost at a 100 percent.


Brady Deaton Jr.: If you enter into the Framework Agreement, can the land be sold to members outside the First Nation or there's certain rules of the Framework Agreement requires of all First Nations' land codes?


Chief Louie: The individual First Nation has a choice to do certain things, it's [inaudible 00:17:40] to sells or leases its lands, if you do so internally. But one thing is very, very clear, reserve lands as such cannot be sold to diminish the reserve land size. That was a concern that was expressed by First Nations at the assembly of First Nations levels, and expressed as [inaudible 00:18:01] country from time to time, because in the past, First Nations have had things, like expropriation take places, roadways, hydro lines, seaways, you name it, lands cut off from their reserve lands. So, this process, fundamental process that recognizes, and the principle that's recognized is that lands cannot be diminished in size. As such, they cannot be sold to anyone that's a nonmember of that First Nation.

It can, however, be leased, which allows for economic development, and allows for interest, it could be registered and protected, and allows for the economy to proceed on the First Nation. But that's the fundamental difference.

It's a concern that was looked at in places like United States where, in the past, First Nations are tribes in the United States were allowed to sell off portions of their reserve lands to raise money for certain purposes. Here, land cannot be sold to diminish reserve land size.


Brady Deaton Jr.: With the land codes that have been adopted, is there a significant variation amongst the First Nations, in terms of their land codes or are they relatively similar?


Chief Louie: They're unique in the sense that there's no two First Nations that have identical land codes. There's always variations and changes. For example, some First Nations may choose to have land's committees that will be involved in the law making processes. It has to go through that committee, and the committee makes the recommendations and that's how laws are proceed ,and how laws may be administered without the involvement of the First Nation's committee.

Other First Nations may decide that "no, we do not need committees", once we have land code in place, we have the process in place, First Nations may act much like, let's say, municipalities, where you have, let's say, a director of lands who will make that decision, and will keep the politics separated from the government and matters proceed.

Every First Nation has a variation in one form or in other. Some will have historic land that needs to have protected for various religious purposes or cultural purposes, certain lands may have different statuses to the extent that they may not be certificated possession lands, but they have the recognized ownership level by certain individuals, and it has a method to allow for lands to be mortgaged through leases.

Every First Nation is slightly different. Some First Nations have [inaudible 00:20:41]lands in common, that is the total reserve, there's no individual recognized land. Its land's held in common by every member of that community.

Other communities have a mixture. There's reasons for the uniqueness of every First Nations land code.


Brady Deaton Jr.: You mentioned certificates of possession sometimes I think about three primary sets of varieties on First Nations, I wouldn't mind if you kind of comment on certificates of possession, leases and customary rights. What are the kind of differences between those?


Chief Louie: Let's take it from this perspective. A certificate of possession, first it's an instrument that is referred to quite often, that recognizes that individual member has certain beneficial rights that pertain to the land. It's a form of title, if you will, that says that person [inaudible 00:21:34] has that in their possession. And certain First Nations will allow 100 percent of the revenue proceeds from the land lease, for example, to go to that individual. Some communities will say "No, a percentage goes to the land in common, the remaining balance goes to the individual". There're different interests that might pertain to that instrument. It's really an instrument to recognize the rights that pertain to the wishes of the community.

A lease is an instrument that allows for mortgages, let's say, banks to take the mortgage on that particular lease and say "this is either for housing purposes or it's for developmental purposes" and recognizes the form without losing the land, but having a timeframe set to that land, where the rights are set for a particular term, and a particular purpose, to allow for loams and for [inaudible 00:22:30]. Protects[inaudible 00:22:32].If they wish to say "live on lands and live on First Nations' lands", and to have a valid instrument that is recognized by banks and other financial institutions.

The customs vary of course, from one First Nation to another. Customs of land use, there may be certain land set aside strictly for customs of the First Nations to recognize things like graveyards, or particularly events that take place. These lands are always been protected. There's variations in all that.


Brady Deaton Jr.: I'd like to talk a little bit now about economic development. There's obviously a number of reasons, and you've mentioned them, why First Nations might wanna adopt the Framework, including things like the right to self-governance. But one area that always interested me is, with respect to land, land is a factor of production. It's a way of generating wealth and transacting land requires secure property rights. It also requires that the transactions cost, the search and information cost associated with insuring a transfer of land aren't prohibitive. And this is an issue that I believe that the Framework Agreement sets out to address in 1999, when the First Nation management Act was being passed. The minister of Indian Affairs and Northern Development said something to the effect that this means that, "First Nations will no longer have to turn to me for their approval. They will have the opportunity to move quickly when the economic opportunities arrived or when partners approach them."

How does the First Nations Land Management Act or the Framework Agreement reduce these costs? How does it allows First Nations to act more quickly?


Chief Louie: The land code and the land measurement process that is adopted by First Nation allows the First Nations to take advantages of things like economic development potential. It really at speed of business. And by speed of business I mean that there is no [inaudible 00:24:40] red tape that [inaudible 00:24:41] that the department of Indian Affairs is required to do.

For example, let the Minister of Indian Affair and send it to members of [inaudible 00:24:49] have commented on through varies hearings. And they recognize that there is a process for the First Nation that operate under the Indian Act that has to go through step by step approval. And that step by step approval involves varies regions. For example, in British Columbia and Vancouver region that has to involve the regional director, it goes to a land process, and that particular process land reports to the headquarters' office in Ottawa, they then make the determination there, department of Justice is involved, it's kicked over to Surveys, where you have the Natural Resources involvement, so you have a very [inaudible 00:25:28] process of approvals. Sometimes it's granted, sometimes it isn't.

That boils down to huge delays, red tape that's involved, so a particular First Nation that says "we want to do a particular development, we got a partner that wants to [inaudible 00:25:45] with us.". They get involved and in those discussions and they go through the Indian Act process. That development may well be shell because after a couple of years or sometimes longer, the [inaudible 00:25:59] partner says "I give up, I cannot perceive, we got to move elsewhere."

With this land code process, you don't have that red tape. The First Nation can develop its laws, its procedures to ensure speediness to allow for the speed of business to occur. It can have a voting process internally with the First Nation community, if it involves lands in common. It could have processes that are set up that can actually deal with it in a matter of weeks or a few months, as opposed to years and perhaps never.

We got all kinds of examples throughout Canada, where you had First Nation development[inaudible 00:26:38] because of the red tape and the bureaucracy that the department of Indian Affairs, that whole process under that Act brings.


Brady Deaton Jr.: What are the kinds of outcomes you mentioned earlier that you've calculated the return or high return on the investment for First Nations that opt in to the First Nation Land management Act or the Framework Agreement? Can you tell me some of the outcomes that have gone on that you believe would not have occurred if it weren't for the First Nation having First Nation Land Management under the Framework Agreement?


Chief Louie: Yes, it's been demonstrated through varies studies. I mentioned earlier the KPMG report for example. KPMG did a study, I believe was 17 First Nations that they chose at random to look at, to say "Has the land code and the Frame Agreement process made a difference to those First Nations?". The answer is a definitely "Yes". Some of the examples are such that some of the First Nations who had unemployment at varies high levels, there was a significant reduction in those social assistance needs. One community was reported to go down from a 67 percent social assistance dependency down to five percent. In the timeframe it was shown that more 10,000 employment job opportunities for non-members came into effect, pumping hundreds of millions of dollars into local economies. Not only the local economy of the First Nation, but that money spreads to the adjacent municipalities and other non-reserve regions.

Benefits like administration cost to register land transactions reduced and the average reduce of 500 dollars by the First Nation, compared to Canada's cost more than 2,500 dollars per transaction.

Processing delays at the speed of business, compared to Canada's months or years or perhaps never. These types of benefits [inaudible 00:28:37] and those findings are very remarkable, it shows the worthiness of a land [inaudible 00:28:44] reasons, why land codes are needed in this country.


Brady Deaton Jr.: As you mentioned, the Framework Agreement and the First Nations' Land Management Act is historic and one of the first, if not the first, to address self-governance with respect to land on First Nations. More recently, there's been a fair amount of discussion about something referred to as the First Nations' propriety ownership, can you give us some background about that initiative and what are your preliminary thoughts, how is it different, how it's similar to the Framework Agreement?


Chief Louie: My understanding that the First Nations Property Ownership Lands Act is a process that is to recognize that reserve lands would in effect not come under federal jurisdiction. That would become provincial jurisdiction and as such fall under the provincial regimes of ... by provinces.

What is concerning with the First Nations involved in the Land Management process under section 91 (24), as I understand it, with First Nation majority, the vast majority of First Nations in Canada, is that they do not want to have the jurisdiction from the federal domains switched over to a provincial domains, fee simple or not.

Fee simple was proposed to the Frame Agreement First Nations, back in the mid 1990's, and it was promptly rejected. It was rejected, [inaudible 00:30:18]very, very careful consideration however. In the fact that First nations see the responsibilities of reserved lands falling under the 91 (24) jurisdiction. So that laws have been clearly stated, as far as the land codes are in place, that provincial government do not have a say, nor do they have law making capacity over the First Nation.

Once you get in to fee simple and registration of First Nation lands in the provincial registry system, that brings in to place the provincial laws of registration. That is quite a serious concern. It's something that has been vastly rejected by almost unanimous [inaudible 00:31:08]. There's only a handful of First Nations, that I know of in Canada, who are supporting the First Nations Propriety Ownership Land proposed legislation.

It's something firmly rejected by the vast majority, clearly.


Brady Deaton Jr.: Now, one thing I'm uncertain on in the proposal to transfer to the province or is it to transfer the under align legal title to the First Nation?


Chief Louie: The proposal under the Property Ownership legislation is such that it would transfer the lands to the ownership of the First Nation, but having done so, the lands would then be registered in the provincial system. Not the federal system. There isn't a process federally that allows for lands to have fee simple ownership, it doesn't exist. We discussed the issue many legal councils and from my understanding, from the legal council [inaudible 00:32:03] there isn't anything in the constitution that really properly allows that, unless you somehow get it over into the provincial domains. That's what being firmly rejected.


Brady Deaton Jr.: We come into the end of this interview. It's been very informative for me and I appreciate it. Is there anything ongoing or anything that you think that you would like listeners to know about or to be aware of that you would want to discuss that we haven't discussed already?


Chief Louie: I think the listeners and that would include the government of Canada. I believe that with the demonstration and the proof that there can be very fine returns, that can be created by the investment into the Land Measurement process. That Canada has to really, seriously consider that in the long term it will be well worthwhile for Canada to invest in First Nations to allow ... Right now we have a [inaudible 00:33:04] 83 First Nations on the waiting list. They're waiting patiently, they want to be involved, I receive telephone calls, I receive letters, continuously, asking when they can be involved. If Canada [inaudible 00:33:18] recognize that very simple request and to understand, and I believe that there is understanding that is taking place now, that by investing in First Nations in the one regimen process, we'll give a return. Not only to the First Nations, but to the local economies, provincially, and nationally.

I think that's something that really has to be really understood. And I think that we will see [inaudible 00:33:44] by First Nations [inaudible 00:33:47]. They can be self-sufficient. And I think that's the goal to the future and that's the wishes of First Nations across this country.


Brady Deaton Jr.: Chief Robert Louie, thank you so much for discussing the First Nations Land Management Act and Framework Agreement with me today. I appreciate that and good luck in all your efforts.


Chief Louie: Thank you very much, Brady. It's been a pleasure to be part of this interview.


Brady Deaton Jr.: You've been listening to FAIR-Talk with Brady Deaton, Jr. of the Department of Food, Agriculture, and Resource Economics at the University of Guelph. Thanks for joining this.


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