Evidence of meeting #40 for Aboriginal Affairs and Northern Development in the 41st Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was investment.

A recording is available from Parliament.

On the agenda

MPs speaking

Also speaking

4 p.m.

Conservative

The Chair Chris Warkentin

Thank you very much.

We'll turn to Mr. Payne now for seven minutes.

4 p.m.

Conservative

LaVar Payne Medicine Hat, AB

Thank you, Chair.

I thank the panel members for coming and Mr. Le Dressay for appearing on the video screen with us today. It's important that we get your testimony, as of course, this is a very important study, as you've already suggested.

I would like to start off with questions for Mr. Le Dressay. In terms of what you have written here in a research paper, and comparing the municipal boundary expansion to additions to reserve, you stated that additions to reserve are too slow, too cumbersome, too unfamiliar, and many witnesses, of course, have stated that same thing when they've come to our committee.

Could you tell us what best practices from municipal boundary expansion projects could be applied to the ATR process?

4:05 p.m.

Director, Fiscal Realities Economists Ltd.

Dr. André Le Dressay

Yes.

First, the research in that paper demonstrated a useful statistic, I think. It's that the municipal boundary expansion process—depending on the circumstances, the ones we compared—was six times shorter than the additions to reserve process.

Two reasons seem to demonstrate why that occurred. One was that it's much easier for the municipalities to expand their boundaries because there is jurisdictional harmony once they expand them. When a reserve expands its boundaries, you have a change in jurisdiction from provincial to federal, and so there are all sorts of harmonization issues.

The other aspect that results with respect to that particular issue is that the federal government is unable to—I shouldn't say unable to. It's almost like a game of fiscal ping-pong, I guess that's a better way of phrasing it. When it becomes federal land, there is potentially a liability for the federal government with respect to the cost of development on those lands. The federal government wants to make sure there is a great deal of economic viability and ultimately fiscal viability on those lands. Those requirements take a long time for first nations to fulfill and demonstrate.

What could be done to speed that up? Two things.

First, first nations are missing a lot of the legal framework that is commonplace within provincial systems. In my little research brief that I provided to the committee, we listed 30 or 40 laws that are essentially missing, by and large, on first nations lands, which you almost have to recreate.

If there was a turnkey framework that provided those laws, and there was some sort of regulatory harmony between those and the provincial system, that would greatly speed up the additions to reserve process.

Second is the demonstration by first nations of the economic viability and the economic potential. I think it doesn't become a game of fiscal ping-pong. It becomes an issue of this growth being beneficial to the whole region.

I think there's a real potential to see ATRs as economic instruments, which most first nations view them as. To realize that potential, you have to close the institutional gaps as quickly as possible.

4:05 p.m.

Conservative

LaVar Payne Medicine Hat, AB

Also, in the briefing material you provided to the committee, you suggest that ATRs could be made faster through greater use of the First Nations Fiscal and Statistical Management Act and the proposed first nations property ownership act.

What are the benefits of the FSMA and the FNPOA, and how would those two speed up this process?

4:05 p.m.

Director, Fiscal Realities Economists Ltd.

Dr. André Le Dressay

The FSMA would speed it up because it would demonstrate that the first nations have, at least in terms of the institutional gaps, local revenues and local service powers. That's very important for local governments in establishing service agreements. There is support from those institutions to help first nations create those service agreements so that local governments don't see ATRs as tax losses; they see them as potential service agreement gains. That's one thing that would definitely speed up that part of the negotiation.

The proposed property ownership act, I think, would have two aspects that could speed up additions to reserves. First, because it's proposed that it come with a turnkey legal framework, it would have a lot of that harmonization already in place with respect to development approval processes, heritage management, and other aspects of the institutional gaps.

The second thing is that, because it envisions property rights very similar to those that exist off first nations lands, the transfer of the third-party interest would be much simpler, because all that would be happening would be that they would maintain their interest, but they would now be under a different jurisdiction.

It would make those processes associated with ATR much quicker.

4:10 p.m.

Conservative

LaVar Payne Medicine Hat, AB

Okay.

You've used the phrase “turnkey framework” a couple of times. Would that be applicable right across all first nations? We quite often hear that each first nation has its own particular issues and traditions and that sort of thing. That kind of leaves me wondering.

4:10 p.m.

Director, Fiscal Realities Economists Ltd.

Dr. André Le Dressay

Obviously, first, that would have to be optional. First nations have to exercise their freedom of choice, and then it'll be their choice. What it would have to contain is regulatory harmony, as much as possible, within their regional context. A different turnkey framework would exist in Newfoundland than would exist in British Columbia, because there are different regional practices. But that doesn't mean you wouldn't be able to have that application in Newfoundland or B.C. It would just be a slightly different legal framework.

I'm trying to remember the rest of the question.

4:10 p.m.

Conservative

LaVar Payne Medicine Hat, AB

That was it. It was just on the framework and whether it would apply.

4:10 p.m.

Conservative

The Chair Chris Warkentin

You're pretty well out of time.

4:10 p.m.

Conservative

LaVar Payne Medicine Hat, AB

Darn, I still have another question.

Thank you.

4:10 p.m.

Conservative

The Chair Chris Warkentin

Thank you very much.

We'll turn to Ms. Bennett, now, for seven minutes.

4:10 p.m.

Liberal

Carolyn Bennett St. Paul's, ON

Thank you very much.

Mr. Le Dressay, the first of your four recommendations is, of course, the proposed first nations property ownership act. As you know, as we've criss-crossed the country, there have been lots of concerns expressed about this in terms of the almost existential threat to a reserve's integrity. There's the potential of having a checkerboard.

Even when Mr. Jules was here, he could really only name four or five reserves that had expressed any interest in this at all. So it seems that the majority of chiefs and councils aren't really interested in this.

I wonder, as Mr. Payne asked with respect to the turnkey legal framework, if that is only obtainable through the proposed legislation. Are your third and fourth recommendations possible without it?

4:10 p.m.

Director, Fiscal Realities Economists Ltd.

Dr. André Le Dressay

I think the only way you can establish the turnkey legal framework is through a piece of federal legislation, and that piece of federal legislation is being proposed right now. That might be a good place to put it. I'm not saying it can't be in other places.

Can you build administrative capacity without the property ownership? Of course you can.

I do want to make one thing clear because you mentioned the checkerboard. I think there's a general misunderstanding—and it certainly was mine until it was explained to me by a leader up in Kitselas—in that there's a difference between when we say a property is held in fee simple by an individual and what a government owns. This is how he explained it to me. He said, people think that because they have fee simple ownership, they own the property, but here's a little experiment for you. Stop paying your property tax and find out who owns your property.

I think that's what's certainly contained in that particular proposal. The difference between government property rights, I guess, is in some cases that they can own the property, but they also have the jurisdiction, the land, and tax powers. They also have the reversionary rights, and they also have expropriation powers.

It doesn't matter who owns the land. Those powers always exist. I'm from B.C. If I were to purchase land in Saskatchewan, it doesn't all of a sudden become B.C. It's still Saskatchewan because they still have the underlying jurisdiction, the reversionary rights, and the expropriation rights.

In the exact same way, that's how the proposed property ownership act would work. First nations would always retain the jurisdiction, the tax powers, the land powers, the expropriation powers, and reversionary rights. And so it's always their land regardless of who's there.

4:15 p.m.

Liberal

Carolyn Bennett St. Paul's, ON

I think the question has been that the ability to sell the land to someone who's not a member of the community puts everything at risk.

Maybe I should ask the first two witnesses what do you think of the proposed legislation, and why do you think there's been so little interest in it from the rest of first nations communities?

4:15 p.m.

Partner, Devlin Gailus Barristers and Solicitors

Christopher Devlin

I haven't reviewed that particular piece of proposed legislation but stepping back on the fee simple question generally, you talked about existential questions and the nature of the aboriginal title held in reserve lands recognized by the Supreme Court of Canada in Garron. I think many first nations take that very seriously.

I think there's also a fundamental difference between first nations that are located in urban or semi-urban areas and the bulk of first nations lands, which are in the hinterland, and frankly have almost no value to them unless they happen to be sitting on a big pool of oil.

In those rural communities even if you had a legislative framework in place—even under the Indian Act there are economic opportunities that can be accessed, and we can talk about those even under existing regulatory framework—when you're in the hinterland when you have no industry around, you can't put a Walmart on your reserve. No one will come and buy things there. That often I think is a real driver as well.

For the communities that are in urban and semi-urban areas or they're on a major highway and there's easy transportation access, then I think the kinds of questions about ownership and property ownership become more relevant. But most first nations aren't there, and I think that may be one reason why you're not seeing an overwhelming number coming forward saying we want that. As my partner said, I think the ones that are blessed with a certain geographic advantage, are the ones that are rightfully driving this debate.