Thank you very much, Mr. Chairman. It is a pleasure to be before the committee today as it continues its study on access to capital.
When it comes to capital for housing, the situation across the country is far from uniform. Many remote communities are facing housing crises that are intrinsically linked to poverty and have no history of accessing capital from the market to build homes, while other nations are moving forward on housing improvements as they benefit from the significant economic development on or near their territory.
The fund works with first nations from across this spectrum. We partner with any and all first nations that see market housing as a part of the solution to their housing situation—communities that believe that their citizens should pay for their homes—and we help communities of all types get results on their terms. But simply providing access to capital alone is not enough. I will illustrate with my comments today the important steps that must be taken before access to capital is gained if it is to lead to long-term success.
When we put together these steps to make a path to market housing—a process that includes all the spade work that is necessary before a home is built in a community—the first step is that a first nation decides to become a partner with the fund.
I am pleased to say that 183 first nations have chosen to partner with the First Nations Market Housing Fund. This is nearly a third of all first nations across Canada, a number that is impressive given the voluntary nature of the fund and the amount of work that goes into each partnership. Our partner first nations can be found in every region of the country from the west coast to the east coast, from southern Ontario to the Yukon and Northwest Territories. They are communities that have populations as low as 100 and as large as 9,000. They are located in urban, rural, and remote locations.
Our partnerships with first nations move forward with the pace and timing that each individual first nation chooses. We have no deadlines for submissions and, should other more important or urgent matters arise with the first nation, they can easily pause and then later restart their work with us.
In our process, the first major step is an assessment of the first nation and how we work with them. We determine what their path forward will look like, what capacity development initiatives are needed, and whether or not the first nation is ready to access capital through our credit enhancement program. Right now, 58 first nations are in the assessment process of partnership with us.
In capacity development, which is the third major step, to date more than 85 first nations have participated in more than 800 capacity development initiatives supported by the fund. This includes an estimated 2,700 individuals who have participated in training supported by the First Nations Market Housing Fund. Capacity development helps strengthen the management and governance of communities that we think go beyond the housing file.
As examples of this training, 157 individuals from 27 first nations have completed an Aboriginal Financial Officers Association course; 154 individuals from 12 first nations have taken a course on project management training; and 6 individuals from 5 first nations have gained their National Aboriginal Lands Managers Association certification.
Some of the key outcomes from our capacity development are that 39 of our partner first nations have now developed a housing policy; 16 of our partner first nations have developed land use plans, land use bylaws, and zoning bylaws; and 15 of our partner first nations have developed new financial policies, bylaws, or laws.
Turning to credit enhancement, when the right set of policies and human infrastructure is in place, first nations can then take the fourth step on the path, which is credit enhancement. This is where the fund provides qualified first nations with a 10% backstop for housing loans, which are also guaranteed by the first nation. The approval of the fund provides financial leverage to negotiate with lenders that result in lower interest rates, reduced program access fees, risk-sharing opportunities, and administrative arrangements that are favourable to each first nation.
Currently 79 first nations are approved for credit enhancement with the fund. Three of these first nations started out at the capacity development process only with the fund, and because of the work they have done with the fund, they are now eligible for credit enhancement. We anticipate that many more first nations will make this type of progress in the next few years.
Right now the 79 first nations that have been approved for credit enhancement have been approved for over $725 million in credit to build new homes. This total of $725 million in credit can be used to build or purchase approximately 4,650 homes. We have some 14 partner financial institutions offering these loans to qualified first nations, and these partners are selected because they are responsible lenders, providing good value and terms that are clearly understood by the borrowers.
As of today we have 99 new homes that have been built, purchased, or renovated using loans backed by the credit enhancement the fund offers. Though the number of total homes built is low, the rate of growth is promising. The first few years of the fund's work were the hardest and real change is now coming. Many of the communities are now ready to start building homes. More and more first nations members are aware that buying a home is a real possibility.
There are no shortcuts to the market housing experience. It should not be surprising that change is occurring on a longer timeframe than was originally anticipated. Of course, we are anxious to get more homes financed and built, and while we want more first nations and their members to travel more quickly down the path to owning a home, we will never take shortcuts. We want to make sure that we are setting first nations up to succeed, not to fail. This means that for many first nations the path to market housing could take years to travel.
When they start partnering with us many first nations lack management rules in areas like land. Many first nations have limited experience or access to the necessary expertise to implement market housing. Some have never contributed to the cost of their housing, a step that needs to be embraced before you can contemplate taking on a loan program. Members often have had little opportunity to learn necessary financial literacy skills like personal budgeting or saving for a down payment. Our job is to make sure they have the financial and management capacity necessary to successfully introduce or expand and sustain market housing for their community. It is incredibly important that we do this job right the first time.
In essence the fund is a financial institution and must hold itself to the same high standards as other financial institutions. The one-time investment of $300 million dollars by the federal government remains in trust. In fact, the value of the trust has now grown to $344 million.
Our operations are wholly funded by the interest generated by this trust. The unspent principal allows us to backstop all of our credit enhancement activities. It was always intended that the trust would remain intact to provide that collateral security equivalent for land that others who are living off reserve use when they borrow for a home loan.
We continue to take our financial trust and, more figuratively, the government's trust and the public's trust, very seriously. We were never meant to be a short-term fix that just made a small dent in the problem then disappear from view.
The financial trust of the fund remains fully preserved and growing because that is the only way we can consistently increase the activities we support and be a meaningful part of a long-term solution.
As we look into the future we see that there is no one solution to the housing challenges faced by first nations. But market housing and the work of the fund is an important part of the mix of solutions necessary to provide access to capital, build homes, strengthen communities, and empower individuals across Canada.
I welcome any questions that you may have.
Chi Meegwetch. Thank you very much.