Proceedings of the Standing Senate Committee on
Aboriginal Peoples
Issue 11 - Evidence
OTTAWA, Tuesday, February 5, 2002
The Standing Senate Committee on Aboriginal Peoples, to which was referred Bill C-37, to facilitate the implementation of those provisions of First Nations' claim settlements in the Provinces of Alberta and Saskatchewan that relate to the creation of reserves or the addition of land to existing reserves, and to make related amendments to the Manitoba Claim Settlements Implementation Act and the Saskatchewan Treaty Land Entitlement Act, met this day at 9:30 a.m. to give consideration to the bill.
Senator Thelma J. Chalifoux (Chairman) in the Chair.
[English]
The Chairman: Honourable senators, I welcome the witnesses. Mr. Youssef, please proceed.
Mr. Michel Youssef, Director, Special Implementation Projects Directorate, Department of Indian Affairs and Northern Development: Honourable senators, Bill C-37 will benefit First Nations and other Canadians with developmental interests on proposed reserve lands.
Bill C-37 will assist First Nations' efforts to provide economic development opportunities on their proposed reserve lands even while these lands are being added to reserves. Third parties, in turn, who hold existing interests on those lands, or who wish to enter into new ventures with First Nations, will have commercial certainty in their deal making. Finally, this bill will assist Canada in meeting its claims-based reserve expansion obligations.
Bill C-37 provides a useful tool for the parties involved in the development of the proposed reserve lands by facilitating and accelerating implementation of reserve expansion commitments under Alberta and Saskatchewan claims settlements. This bill will provide a variety of mechanisms for accommodating existing or proposed third-party interests on selected lands even before the lands have been purchased by the First Nations.
As a result of Bill C-37, First Nations will be able to negotiate with third-party interest holders and conclude agreements even while they are negotiating the acquisition of the land with the titleholder. This will significantly assist First Nations when making decisions on land acquisitions by ensuring that existing encumbrances are dealt with in advance of investing money to buy the lands.
Advance accommodation of third-party interests will also permit development of proposed reserve lands during their processing to reserve status. This will mean that First Nations will be able to select economically viable lands, perhaps even lands already in development, instead of simply lands that have the fewest third-party interests with which to deal.
Bill C-37 will further streamline the reserve-creation process by empowering the Minister of Indian Affairs and Northern Development, rather than the Governor in Council, to confer reserve status on lands selected pursuant to claim settlements.
To put the potential impacts of Bill C-37 in context, the 24 existing Alberta and Saskatchewan claim settlements amount to just over 2 million acres in unimplemented reserve expansion commitments, large amounts of which have been selected and are being assessed under the department's Additions to Reserve policy. Most of these land selections, if not all, will be affected by third-party interests or new development proposals. These commitments, coupled with some 1.5 million acres under 14 existing Manitoba claim settlements covered by the Manitoba Claim Settlements Implementation Act that was recently enacted, amount to 97 per cent of our claims-based reserve expansion commitments nationally. These activity volumes are what have led the Government of Canada to recommend prairie- based legislation.
Honourable senators, it is important to note that Bill C-37 will only apply where a First Nation opts into this process. First Nations will be able to choose between adopting the provisions of the proposed legislation in relation to their claim settlements or continuing to use the existing processes. For example, if a First Nation has more than one claims settlement, it might choose the Bill C-37 approach for one of its settlements and, for reasons of its own, the existing mechanisms for the other. Complete flexibility is provided for First Nations.
Bill C-37 does not give effect to the claim settlements; it merely facilitates their implementation.
Bill C-37 also includes amendments to other legislation, including the earlier Manitoba Claim Settlements Implementation Act. These amendments are simply intended to improve the language, clarity and application of the affected legislation and to ensure complete consistency with Bill C-37.
Honourable senators, thank you for the opportunity to address this committee on this important bill. My colleagues and I are available to respond to your questions.
Senator Johnson: This is a technical bill. I spoke to the matter when the legislation affecting Manitoba came into effect. This bill facilitates implementing land claim settlements. Claims must be settled first.
In regard to commitments, you mentioned a figure of 97 per cent. Is the remaining 3 per cent relevant to this discussion?
Mr. Youssef: We are talking about treaty land entitlement and specific claim settlements that commit to the expansion of reserves. When I say 97 per cent, I mean of those settlements nationally. The 3 per cent would be outside of the Prairies.
Senator Johnson: What is happening with that 3 per cent? Is that relevant to this; is that separate?
Mr. Youssef: The 3 per cent portion is not covered by this legislation at present. The volumes in the Prairies led to an understanding on all sides by virtue of the volumes they were dealing with.
Senator Johnson: Is there a shortfall on the Prairies? Is there a shortfall there compared to others regions?
Mr. Youssef: In the main, the large volumes stem from treaty land entitlement, yes.
Senator Johnson: In Manitoba, the legislation was passed in October, 2000. To date, there has been no way that First Nations have been able to take advantage of the provisions because DIAND still lacks an administrative process by which they could do so. How typical is that? Upon the bills coming into force, when do you expect that there will be an application in reality?
Mr. Youssef: There are five First Nations in Manitoba that have exercised their option to implement their treaty land entitlement settlements using Bill C-14; several more are in the process of considering whether to opt in. With respect to the five that have opted in, their land selections are proceeding, but they have not utilized the mechanisms in Bill C-14 simply because their land selections have not reached the point that they needed some of the powers in this proposed legislation. They have been dealing with other things such as surveys, environmental inspections and that kind of thing.
Most of the provisions of Bill C-14 do not require the design of new administrative implements. They are fully implementable using existing processes that are analogous under the Indian Act. Here, I am talking about administrative procedures. However, two provisions, the reserve creation power by the minister and the power of the minister to accept pre-reserve designations, do require the design of new administrative instruments. These are nearing the completion of their design. We expect to have them in place shortly, and certainly well before any First Nations need those powers.
Senator Johnson: I understand you to say that DIAND is creating the administrative process. Will this model be used in Saskatchewan and Alberta?
Mr. Youssef: Yes, that is part and parcel of what has taken some time to ensure that processes are uniform across the three provinces.
Senator Johnson: Will there be an executive director, as there is in Manitoba, for that same kind of structure or framework?
Mr. Youssef: Are you referring to the regional units that implement the settlements?
Senator Johnson: The executive director of the TLE committee of Manitoba represents 20 TLE claimants in the province; is that correct?
Mr. Youssef: I am aware of the treaty land entitlement committee. However, I believe in Saskatchewan there is a treaty entitlement director who works with DIAND to help First Nations with implementation. In Alberta, it is a different situation.
Senator Johnson: Will the three provinces be different in terms of their ways of implementation?
Ms Evelyn Shalapata, Director, Treaty Land Entitlement, Specific Claims, Saskatchewan Region, Department of Indian Affairs and Northern Development: In Saskatchewan, the treaty land entitlement framework required many technical activities for the band, so the Federation of Saskatchewan Indians set up a unit to assist First Nations to build their capacity in choosing land, dealing with third-party interests, as well as land titles and other such things.
We fund them on a yearly basis, but not on an ongoing basis. We fund them up to the point where they are not needed, and they have been reduced in size over time, when the First Nations acquired the capacity to look after their own land transactions.
Senator Johnson: What is the situation in Alberta?
Mr. Jim Sisson, Director, Claims and Indian Government, Alberta Region, Department of Indian Affairs and Northern Development: Alberta is a bit different in this respect. The province prefers to negotiate on a nation-by-nation basis, so each agreement deals with just one First Nation. Hence, the implementation really is a function of the relationship between the Government of Canada, the Province of Alberta and the First Nations. We tend to deal with them on a one-by-one basis. The administrative processes within our region would deal with these issues, so we would standardize with national policy to follow the ministerial approval as opposed to Order in Council, but that would happen within the Alberta region of Indian Affairs.
Mr. Youssef: Regarding the question you raised, senator, the instruments and procedures we are designing are for the internal processing of the ministerial decisions on reserve creation and pre-reserve designations. It is not a matter of a procedure between the First Nation and us. Once the reserve addition or the designation is ready for approval, we have to design what those forms look like and what route they follow, simply because it was different from going to the Governor in Council.
The Chairman: As you know, in the Alberta region, which I am more familiar with, there have been land claims negotiations for many years. No one seems to be able to make a decision. I am talking about the Lubicon, the Bigstone, and the issues between Trout and Peerless Lake. I understand that the Alexanders have had theirs settled, as has Alexis.
Nevertheless, how will this bill help the settlements in the northern part of the province come to fruition? I have had calls from people telling me that they have been fighting for 10 years and they have not heard anything. How will this bill affect that?
Mr. Youssef: Bill C-37 is a post-effective date implementation bill. It will help move lands to reserve. It does not necessarily deal with facilitating negotiation. It is particularly germane to the Alberta situation, where they identify the lands at the time of negotiation. Being able to know how you are going to clear the third-party interests will help at least in respect of the land aspects of those negotiations. In the Alberta situation, it should help in reaching settlements.
In Manitoba, for Bill C-14, and in Saskatchewan, generally it is a little different, where the settlements deal with providing money to buy land on a willing-buyer and willing-seller basis, so you do not necessarily know what interests will be on those lands. In that sense, it might not help so much in the negotiation.
I know the department is looking at other pieces in the works that may lead to facilitating or accelerating settlements, but this legislation is post-effective date really, apart from the one wrinkle I have mentioned for Alberta.
Mr. Sisson: In Alberta, we have 11 treaty land entitlement or adhesion settlements. We are currently negotiating four others actively, including the Bigstone negotiations with Peerless and Trout Lake, Chipewyan Lake included, as well as Lubicon, Fort MacKay and Fort McMurray. There are a few more currently in research. In terms of time frames, in these cases negotiated settlements require three parties to come to an agreement, and it is not always easy to get those three parties to see it the same way.
We are making our best efforts. We have many dedicated resources to accelerate those files. The Province of Alberta has been a good partner in terms of working with us. They do not always agree with us, but the working relationship is good. We are making efforts towards resolving those issues.
As Mr. Youssef points out, where this bill comes into play is when you are getting closer to reaching the actual settlement. It gives another tool to deal with the third-party interests on the land. In Alberta, one of the things we find, particularly in the north where we have many of these treaty land entitlement claims, is that oil and gas interests are effectively everywhere in the province. It is really impossible to find unoccupied Crown land; hence, we need mechanisms that help us work with these third parties. This bill does provide us with a tool in that respect.
Senator Christensen: This appears to be just an administrative type of bill. I wonder, just for clarification, if you could explain the difference between specific claims and comprehensive claims, land claims that we are all quite familiar with and that go on forever and ever. This seems so simple, yet we are dealing with lands that have not been necessarily covered by a comprehensive claim.
Mr. Youssef: Specific claims, as a group, are divided between two different groupings. The first is treaty land entitlement, which is a type of specific claim. These exist where First Nations did not receive a sufficient amount of lands as promised.
Senator Christensen: Would this piece of legislation apply only where there are numbered treaties, or would it apply to any First Nation that has a comprehensive land claim?
Mr. Youssef: It applies to any claim settlement rather than any First Nation that has a settlement that commits to expanding the reserve land base. That is where it is a little different from comprehensive claims so far. We do not have comprehensive claims settlements that commit to expanding the reserve base.
Senator Christensen: Would a provision for expansion need to be present in their land claim? For example, if the claims of the Nisga'a or the Yukon First Nations had the provision for expansion, then this could apply, but if it was not in that comprehensive claim it would not, is that correct?
Mr. Youssef: Assuming it was in Saskatchewan, Alberta or Manitoba, yes.
Senator Christensen: Am I correct in assuming that this could be written and could apply to those other ones?
Mr. Youssef: There is nothing in the bill that would define it to exclude any comprehensive claim that had such a clause, but there are none right now.
Mr. Sisson: For clarification, in Alberta and Saskatchewan, the land bases are covered entirely by the numbered treaties, so the Government of Canada has taken the legal position that there are no comprehensive claims where numbered treaties apply. As this deals with just Saskatchewan and Alberta, it would not deal with any comprehensive claims.
Senator Christensen: What is the situation in Manitoba?
Mr. Youssef: There are no comprehensive claims in those three provinces.
Treaty land entitlement deals with shortfalls in the historic treaties. Simply because of the volumes there, we tend to deal with treaty land entitlement as slightly separate from specific claims, more largely speaking. Specific claims arise for the breach of non-fulfilment of a treaty obligation that might be related to something other than the provision of reserve lands, such as agricultural clauses in the treaties or medicine-chest clauses; a specific claim could also arise from other grievances, such as the illegal disposition of existing reserve lands or the breach of some other provision of the Indian Act such as dealing perhaps with Indian monies. Those are specific claims. They are grievance-based. All treaty land entitlements are settled with the reserve expansion commitments and include a reserve expansion commitment. Many specific claims do deal with expanding reserves, or they may just be a strict monetary compensation deal.
Senator Christensen: Do the specific claims in some way need to have been a part of the original agreement? Must there be something in that original agreement that gives some direction, some inference that other things were promised but not kept? In that way, you would be dealing with a specific claim. Would there be several specific claims by one particular band?
Mr. Youssef: Yes.
Senator Christensen: It seems so simple. Perhaps I am being suspect. It does not involve Parliament, nor does it involve the settlement that is being effected by it. There is no requirement for a vote in favour of this by the persons on the reserve. It is just a motion by council.
Mr. Youssef: Claims settlements go through a membership ratification procedure.
Senator Christensen: Does it mention anything in here regarding a ratification of the claim?
Mr. Youssef: For the application of the act itself to the agreement, clause 3 directs how the bill would apply to the claims settlement, but as to whether the claims settlement itself is voted on by the membership, yes, it goes to a membership vote as required by the specific claims policy. Memberships ratify the settlement before it becomes a binding settlement.
Senator Christensen: If a specific claim were being made before the minister finalized that, then the bands would have to ratify it?
Mr. Youssef: Absolutely, yes.
Senator Christensen: That is not mentioned in this bill; it is mentioned elsewhere.
Mr. Youssef: It is dealt with in the specific claim policy. I believe the briefing books dealt with ratification and how it happens. It is dealt with under departmental policy. We ensure that there is informed consent to what they are accepting in the settlement as compared to the grievance. Every settlement is a compromise of positions. They put that to ratification, and then the minister signs after the other parties have signed. Usually the other party is the First Nation, but it could involve the provincial government as well.
Senator Christensen: In both provinces, has there been a consultation process on Bill C-37 with all the different bands and individuals?
Mr. Youssef: Yes. There were consultations with all First Nations that have existing settlements listed in the schedule to the bill. On at least three occasions that I recall, they received drafts of the bill, as did Aboriginal groups in both provinces, the Federation of Saskatchewan Indian Nations in Saskatchewan and the treaty executive directors of Treaties 6, 7 and 8 in Alberta. I personally went out and made presentations to the FSIN and at the treaty executive directors' meetings.
I can also tell senators that this bill largely emerged from commitments we made in the Alexander First Nation Treaty Land Entitlement Settlement and the Loon River Cree First Nation Land Entitlement Agreement, and those first nations also received drafts of the bill. There were exchanges of comments which resulted in improvements to the draft bill.
Senator Christensen: Nothing in the Indian Act allows you to do this, so this is being done separately. Why would there not just be an amendment to the Indian Act to allow this to happen?
Mr. Youssef: An amendment to the Indian Act would have been national in scope and would have required a much broader range of consultations nationally. We had consensus in these provinces, largely dictated by the knowledge all parties had of the volumes of lands they were dealing with. They had a lot of experience with the problems of third party interests as they were selecting lands, and they understood what the solutions to those might be. Consensus was readily available. To deal with the 97 per cent backlog in the Prairies, we made a determination to try to proceed with regional-based, Prairie-based legislation.
It is possible that, as things develop, First Nations in other areas might look to this and say this is interesting, but it was not readily apparent at the time that a consensus on these solutions would have emerged nationally.
Senator Christensen: As you said, it is more for the numbered treaties as opposed to those that have concluded comprehensive claims agreements.
Mr. Youssef: Yes. There are specific claims in every region of the country.
Senator Johnson: I have a supplementary question on the specific claims. My information is that 1,089 claims were submitted in Canada between 1970 and June, 2001, and of these only 229 have been settled, 46 in Saskatchewan and 30 in Alberta. This is according to DIAND. Can you comment on that? My colleague was talking about comprehensive versus specific, and in terms of specific, this is as far as they have progressed in that length of time. Is there a reason for this?
Mr. Youssef: I cannot comment on the specific numbers you cited. I noted there were significant backlogs in the negotiation of specific claims, or even in the assessment of them for acceptance for negotiation. That is a problem that the department is looking at. As for what is on the negotiation table for each of the two regions affected, perhaps I can turn to my regional directors. If you want specific confirmation of those numbers nationally, I could undertake to provide that for you.
Senator Johnson: Thank you very much.
Ms Shalapata: In Saskatchewan, 48 claims were settled. That is a moving number because we are settling claims on an ongoing basis. Eight are still in negotiations, and probably three of them are close to settlement. We have 29 that are under review. There is a lot of claims action in Saskatchewan.
Senator Johnson: My figures come from the Specific Claims Branch mini-summary.
The Indian Act does not provide for the expansion of reserve land. Rather, it is dealt with under the federal Additions to Reserve policy. If enacted, Bill C-37 will supersede the ATR policy for Alberta and Saskatchewan First Nations with settlement-based reserve expansion commitments that choose to opt into the bill. Can you tell me how it is that the Indian Act, as the main expression of our federal authority over First Nations communities and the land reserved for their use and benefit, does not deal with reserve expansion, and might the act be amended to remedy this? If not, why not?
Mr. Youssef: This legislation will work hand in hand with the Additions to Reserve policy. Nothing in the Additions to Reserve policy is changed by this other than the fact that the Additions to Reserve policy states you must deal with third party interests. However, it does not provide assistance on how to do that. This legislation will help to do that. They work seamlessly together.
One thing I can say on why the Indian Act does not deal with reserve expansion comes from my understanding of the history of that act. When it was first enacted, it was mainly focused on how to manage existing reserves, and at that time no one was considering how one might expand the reserve land base. I do not know whether it was a decision of the government of the day not to expand reserves or what it was, but it certainly did not deal with expanding reserves. It dealt with managing the assets then in place. I guess how to deal with expanding reserves did not come to the drafters' minds or the government's mind.
As to whether the Indian Act might be amended in future to deal with reserve expansions, I would not want to speculate on what future government direction might be on that.
Senator Johnson: We all know how old the Indian Act is. Do you find it more difficult to work with as time goes on? It has not been amended for a long time.
Mr. Youssef: With respect, senator, I do not think it is within my purview to criticize the act I and the department has to work with.
Senator Johnson: I am not asking you to criticize, I am asking you about the flexibility of the act, given that it is 126 years old.
Do you feel the rationale for replacing ATR policy with statutory process in the case of affected Alberta and Saskatchewan First Nations is positive?
Mr. Youssef: We are not replacing the Additions to Reserve policy. We are merely creating mechanisms to meet a requirement. The ATR policy is the Additions to Reserve policy. We are not replacing that policy; we are merely creating mechanisms to meet one of its conditions, which is the accommodation of third party interests. The Additions to Reserve policy states: ``Deal with third-party interests,'' and that has generally been by buying them out and cancelling it to clear title for title reasons. However, it is more productive to preserve the interests for the benefit of all, the interest holder and the First Nation that becomes recipient of rents and royalties. We are proposing a legislative scheme that will help meet that Additions to Reserve policy requirement. The policy has not changed; it is merely being facilitated here.
Mr. Sisson: If I might just add to that, from a field-based, practical sort of perspective, we do not have a lot of tools to use when working with these third parties.
When working with land that has third party encumbrances, under the current statutory system, you are left with few options to deal with them. We tried various creative solutions in conjunction with First Nations in the province that have not been statutory based, and we have had some degree of difficulty in making those work.
This bill gives us a few more tools to accommodate those interests. We hope to find a solution from which all the parties will benefit. Currently, the easiest solution, if one is acquiring land for reserves, is to remove the third party interests, but there are costs associated with that. They would expect to be compensated, paid out, and they may have an interest in working the land after it becomes reserve land. However, it has been very difficult to allow that to happen.
This bill will give us a tool that will allow us to more effectively create that kind of solution, a working relationship. I would describe it as an administrative technical piece of proposed legislation, but it is about streamlining and giving us a few more options. It will help us work with First Nations to address these issues.
Mr. Youssef: Mr. Sisson has alluded to the long processes of discussions between third parties, the department and First Nations about how to do what everyone had agreed they wanted to do, which was preserve the interest, simply because the First Nations had no legal capacity to vote on granting the interest. Therefore, a lot of time was spent on discussing how to do something and not on what you wanted to do. By specifying how it will be done and empowering a vote to be taken, you take away those months of long discussions on how it should be done. That will allow the parties to focus on the deal they want to reach.
The Chairman: Mr. Sisson, the reserves have been leasing land out forever. If you buy a farmer's land, why would it be so difficult to lease it back to him to work? You do not need this.
Mr. Sisson: Technically speaking, in order for the land to come over to Canada, it would have to leave the provincial system, so we would end up with a provincial order in council, which can only be issued once the land is cleared of all third party encumbrances. There is a gap before a federal order in council kicks in and accepts the land as federal land. It is then added to reserve, which requires yet another process. You have these steps. The problem is preserving the interest. A farmer with a leasehold interest has no guarantees during the period of this gap. It is about trying to deal with that issue, and giving third parties some greater certainty about their rights and interests.
Mr. Youssef: First Nations have been leasing reserve lands, but they have been doing so largely by designation of on-reserve lands. The wording of the Indian Act has been interpreted to apply only to lands that are existing reserves. First Nations can vote only if the reserve already exists. Therefore, as Mr. Sisson indicates, we are bridging that gap.
Senator Gill: I admire your courage and optimism in trying to solve some of these very difficult claim issues.
My impression is that public opinion, generally speaking, is that the money set aside for Aboriginal people is enough, and quite often, too much. We often hear reference to the figure of $7 billion, and people say that they should not ask for more.
You want passage of this bill in order to accelerate or to be able to respond to the claims made by Aboriginal people. That is all very well, but do you have some guarantee that the money will be there? We can make and change laws, but we need the tools or money to implement the provisions of our laws. As the situation presently exists, you will be unable to settle more claims than you have in the past.
Mr. Youssef: The implementation of the claims settlements that are dealt with, specific claims and treaty land entitlement, is already funded within the claims envelope of Indian Affairs, and special funding is in place for the larger treaty land entitlement framework agreements. By facilitating the negotiation of third party interests, we are freeing up more of that implementation money to deal with other issues of Additions to Reserve policy because we are spending less time helping the parties negotiate deals. To answer your question, there is funding in place for the implementation of these types of settlements within the claims envelope.
With respect to the political climate in the two prairie regions that are involved, I do not know if my colleagues would like to add anything.
Ms Shalapata: Saskatchewan is also involved in the claims process, and we have an excellent working relationship with them. We also deal with the urban and rural municipalities to deal with any issues or problems we may have or any questions they may have. There is openness in Saskatchewan to deal with the claims.
Senator Gill: You talk about comprehensive claims and specific claims. Both are included. Will this allow the Indian Claims Commission to accelerate negotiations?
Mr. Youssef: As I indicated earlier, this legislation does not deal with accelerating the pace of negotiations. Alberta might be an exception because they have already identified the lands that will become reserves. However, this proposal will not accelerate settlements. We are dealing with settlements that deal with reserve expansion.
Senator Gill: It will only affect the implementation.
Mr. Youssef: That is correct.
Senator Gill: Is something being done which will accelerate the negotiation process?
Mr. Youssef: I know there are negotiations underway. I know there are discussions about the Indian Claims Commission. I do not deal with area, so I cannot speak in more detail about it except to say I know that another area of the department is working on that issue.
Senator Gill: I would imagine that provincial governments, the Aboriginal people and all the others who have an interest meet with you and discuss and negotiate certain things. I would also imagine that during this process of negotiation you discuss implementation, and that you get the green light from the provincial government. Am I correct in saying that, every time you settle something with third parties or with the Aboriginal people, you have to go back to the provincial government?
Mr. Youssef: There are two steps. For treaty land entitlements, certainly, the provinces are parties to the settlements and where the settlements identify the land, and that is all done at the same time. In specific claims, I believe in both regions, even though the provinces are not parties to those settlements, they are kept informed about how specific claims are going on and what commitments will be made in the settlements.
In terms of the provinces' involvement with the land selections, land will come from the province as part of the settlement, purchased from the province when they are willing to settle, or purchased from a private vendor. When it is a private vendor, the province is consulted with respect to any concerns it might have with that land moving to reserve in terms of impact on its programs and services. The province is involved in the movement of the lands, not necessarily with the dealings with every third party interest or every issue, but it is involved with issues that are of relevance to it.
Mr. Sisson: We have a close working relationship with the Province of Alberta. We consult with them on all treaty land entitlement claims and we keep them advised of developments on specific claims. Where a land interest involves land within the provincial jurisdiction we definitely consult with them.
Mr. Youssef: Of course, it being provincial land, we would not get the order in council from the province transferring the land unless they were happy with the result.
Ms Shalapata: Saskatchewan has an organization that deals with treaty land entitlement, and we have an MOU with them regarding specific claims. We have a good working relationship with them, and we have developed joint processes between the two governments in order to move land to reserve.
Senator Gill: I suspect that Bill C-37 was drafted to deal specifically with the situation in Saskatchewan and Alberta, and it may also have some application to Manitoba. In most of the provinces there are treaties. In those provinces that do not have treaties, do you think this will be a model that will eventually be used? I am speaking about extending reserves rather than comprehensive claims.
Mr. Youssef: This legislation has already served as a model in the sense that Part II of the Manitoba legislation is the model for this. You are quite right that in other provinces where we have specific claims or any settlement that has reserve expansion commitments, the same types of third party interest issues do come up. The volumes are less significant there, so there may be less widespread knowledge and understanding of the problems, but it is fair to say that they will be looking to the experience under the Manitoba bill and Bill C-37 to see whether there are benefits that could be rolled into other provinces.
Senator Christensen: The major work in implementing this is dealing with third parties. Are third party interests aware, for the most part, that they would come under specific claims at some point in time?
Mr. Youssef: Umbrella third party interest groups such as mineral and forestry associations, particularly in the Prairies, have acquired an understanding of what their positions are in the additions-to-reserve process and of the problems of accommodating their interests. As land selections have proceeded, contacts have been made with the identified particular interest holders. They are well aware of what everyone is trying to do. They all agree on what they want to accommodate, they just do not know how to do it.
Yes, they have been involved with that process. Groups like the Canadian minerals associations have some knowledge of it and may even have units dedicated to dealing with it.
Senator Christensen: What would happen in the case of a gas or an oil well that was on a piece of property? If you have to transfer titles all the way through, what happens?
Mr. Sisson: That is a difficult question. Some of the land involved in Alberta on specific claims has actually overlaid producing oil fields, which leads to higher valuations. As a result, we have seen some huge numbers in settlements. Last year we had a settlement with the Horse Lake First Nation for surrender of a reserve that was done fraudulently. The figure was in the neighbourhood of $125 million because it did overlie a large producing natural gas field. That is the cost of doing business in some locations.
Historically, when dealing with an existing oil well, we had a few options. One of the first was what we called a ``keyhole.'' In that situation you give the operator road access and a circle of land around the well to survey. That effectively puts a reserve around a producing oil well, but the First Nation receives none of the benefit that of production.
Recently, the Province of Alberta has allowed us to enter into agreements where the First Nations could negotiate with a producing oil interest to buy a part ownership or to buy it out.
The other option is to see if you can replicate the provincial petroleum and natural gas lease with something in the federal system. That has been difficult to do because we did not have very good tools and there was the gap that I was describing earlier. It is a bit of a leap of faith to give away your provincial interest in the hopes of getting a federal interest when a band vote must be held in between and you do not know what the result of that will be.
This legislation will remove that uncertainty. It will give us another tool to deal with it. We are hoping that we will be able to take a producing oil well, put a reserve around it and replicate the provincial interest with the federal interest. In that way, instead of having to cut it out, you would be able to accommodate it with something similar, and the benefits and royalty would flow to the First Nation as opposed to the Province of Alberta.
Senator Christensen: What about when a municipality or other incorporated or unincorporated interest has a taxation base on the particular land and will lose that taxation as a result of the transfer?
Mr. Sisson: In Alberta, the province takes responsibility to negotiate with the municipality on treaty land entitlement to reach an accommodation on their tax position. We are not involved, in Alberta, in the treaty land entitlement discussions with the municipality. We go to meetings but we do not pay the compensation.
On specific claims, we require that the First Nation directly approach the municipality and work out an accommodation between their interests. Basically, it is part of the Additions to Reserve policy, but consultation is required with the province, with the local municipality and with the third parties. If a First Nation is interested in a particular piece of property, it will engage in discussions with all three of those groups. If they can reach an agreement and accommodation, that will proceed.
Mr. Youssef: Often the compensation is the difference between what the municipality might receive in a fee-for- service agreement. The tax base that is taken was generally used to provide services to those lands. They will now have to do a compensation agreement for fee-for-service. They negotiate on any remaining shortfall on compensation.
Tax loss has not been a big issue in Alberta, but in Saskatchewan it has been. Under the framework agreement, for treaty land entitlement there is a formula between the Province of Saskatchewan and Canada for compensating rural municipalities for tax loss. There is a separate memorandum of understanding between Canada and the province for specific claims. Under that understanding the province takes on the responsibility of dealing with affected municipalities for tax loss.
Ms Shalapata: There is a fund in place to address tax loss for rural municipalities for TLEs and there is a MOU for specific claims.
With regard to the interests on provincial land, under the treaty land entitlement agreement that we have with the province they canvass all their departments to see whether there is an interest on that land. Interests are identified through that process as well as through searches of the titles and so on. Those have to be cleared up before we move land to reserve. All those systems are in place between the province and the federal government in order to identify and deal with the interests.
Senator Christensen: Third party interests is the biggest element in all of this, and it also comprises the big dollar element. Under what legislation does the minister have the authority to pay out those kinds of costs? It is not dealt with in this bill.
Mr. Youssef: Do you mean the costs of dealing with third parties?
Senator Christensen: Yes.
Mr. Youssef: The negotiations are between the First Nation and the third party in substitution of the existing interests under provincial law. The only cost that is involved is the internal administrative cost of assisting as a facilitator in those negotiations. Therefore, we are not talking about buying out interests. However, there are probably exceptions to every rule.
Mr. Sisson: The authority would come from the department's appropriation budget. Their budget for Parliament gives certain authorities around the expenditure of money for claims. In some cases, the only way to get the deal done is to discharge a third party which, in some cases, requires an actual cash payment.
Mr. Youssef: With this bill we are trying to get away from discharging third-party interests because First Nations often benefit from those developments.
Ms Shalapata: Most claims are settled. First Nations then use the funds they receive from the settlement claim to address their third-party interests. There are no additional dollars put toward settling that interest. It is part of their acquisition costs.
Senator Christensen: It is their negotiated claim and the funding that would come with it.
Ms Shalapata: Yes.
Mr. Youssef: There is an acquisition cost component of the settlement. The band's acquisition cost of acquiring lands is built in. That is where the money comes from.
Senator Christensen: It would be the same as the comprehensive claims where funding and lands are part of the whole negotiation. The same sorts of things go with the comprehensive claim, that is, the funding, the land and that sort of thing.
Mr. Youssef: There are commonalities in the sense that specific claims and treaty land entitlements have trust agreements and those kinds of provision. The genesis of the types of comprehensive claims are, of course, very different.
Senator Christensen: Are we dealing here with things that have been promised but have not been fulfilled?
Mr. Youssef: Yes, or breaches of the Indian Act and that kind of thing.
Senator Johnson: Concerning the circumstances under which the non-TLE specific claims occur, are they always related to treaty? What is the relevance of ``lawful obligation''?
Mr. Youssef: It is not always related to treaty. It could be related to a breach of some provisions of the Indian Act, perhaps procedures for a land surrender were not followed properly and perhaps there was not a proper vote of the membership when lands were taken out of reserve. That might give rise to a specific claim or it might be a claim for monetary compensation for the breach, for example, of the Indian monies provisions of the Indian Act. Those do not always lead to reserve expansions; they are often just money deals.
In that sense, the breach raises a lawful obligation. When it is a treaty-specific claim not related to treaty land entitlement, such as a medicine chest clause or an agricultural clause, the fulfilment of those clauses is a lawful obligation. That is where that term comes in. I do not know if our legal counsel could be more brilliant than I was on this.
Mr. Ralph Keesickquayash, Counsel, Legal Services, Department of Indian Affairs and Northern Development: Mr. Youssef has covered, in general, the lawful obligation of a specific claims policy which arises out of an undertaking. The Government of Canada takes upon itself the signing of a treaty to exchange Aboriginal title in exchange for treaty rights. For example, that would incur an obligation on the Government of Canada to uphold the terms of those treaties. That is what we are talking about when we talk about breaches of specific claims. They may or may not include only treaty land entitlement. They may include, for example, terms of surrender. Those are examples of what we mean by ``lawful obligation'' under a specific claims policy.
Mr. Sisson: Generally, the process by which Canada approaches specific claims is as follows. A claim is filed by a First Nation. It goes into a research phase at which the First Nation and the Government of Canada reach a common understanding of the facts. Once we have a common factum, it is sent to the Department of Justice which reviews it for a test of lawful obligation to see if, in their understanding of the law of Canada, there is in fact a legal obligation on the part of the Government of Canada to negotiate a settlement. This is an alternative to taking it through the courts.
There is a test. We do not enter into negotiations without having that test. We will not get the authority. Of the over 1,000 claims that were submitted, some were submitted and rejected, and some were submitted and went through a research phase. In fact, they may still be in the research stage. Once they have gone through the research stage, they will go to negotiation, resources permitting, in terms of the number of negotiating teams available. You will eventually come out the other end with a settlement.
This can be a very time-consuming process.
Senator Johnson: Some take 30 years.
Mr. Sisson: Some go much more quickly, but some are very long term.
Senator Johnson: What is the average length of time?
Mr. Sisson: I do not know.
Senator Gill: Are you doing research together or is each party doing its own research? Some years ago we tried to do the research together to save money and time.
Mr. Youssef: Having seen press releases dealing with some of this, I know of some pilot projects where research is done jointly. It is becoming more prevalent in the Specific Claims Branch to do research jointly with the First Nation.
On the question of multiple specific claims of one First Nation, the Specific Claims Branch tries to deal with multiple specific claims in one group rather than having them negotiated separately as was the case historically. They are looking at joint research and dealing with all First Nations specific claims to settle them all at once. There are people looking at how to do joint research and joint claims.
Senator Tkachuk: How do you resolve the problem of there being more than one claim for a particular piece of land?
Mr. Youssef: The specific claims policy, as does the Additions to Reserve policy, requires that overlapping claims be considered at the time of settlement. If there is an overlapping claim in the land selection phase, the Additions to Reserve policy requires that we ensure there is not an overlapping claim. If there is one, the parties are encouraged to discuss it with each other and to resolve it. That becomes an impediment to adding the lands to a reserve. That has to be resolved before a conclusion of the addition to reserve.
Ms Shalapata: Most claims in Saskatchewan are on a willing buyer, willing seller basis because there are so many claims and not enough Crown land to meet the selection needs. Where they claim a piece of land, it is because there is a willing buyer and a willing seller, especially under the Treaty Land Entitlement Framework Agreement. In most of the specific claims agreements, they have a willing buyer and a willing seller. The piece of land has to be available for sale in order for them to select it.
Senator Tkachuk: Is there an end to the process for a band?
Mr. Youssef: Yes.
Senator Tkachuk: Can they lay claim forever?
Mr. Youssef: Under any given settlement, Canada is committed to a quantum of land. Once they have reached that quantum that settlement is closed. Under the Saskatchewan framework agreement, for example, there is an implementation period provided therein with clauses for renewal or extension, should it be required. Generally, it is up to 18 years from the day of the execution of that agreement, which was 1992. That was felt to be a sufficient amount of time to find lands on a willing seller/willing buyer basis.
Once that settlement is closed and all the lands under that settlement have been provided, that is not to say there might not be another grievance of that First Nation, which has arisen since or which has not been dealt with in the past, that may lead to further additions, but not under that one settlement.
Senator Tkachuk: By making it easier to come to third party agreements, we are developing an incentive to lay claim to third parties. It is more valuable land, is it not? There is usually oil and gas on the land, or it is farmland. Why would they not lay claim there rather than to a piece of dirt on which there is nothing?
Mr. Youssef: Economic development of First Nations is a key to their future. We are creating avenues whereby they can choose more economically viable land and compete with their neighbours for those lands on an equal footing, because they will be able to enter deals more rapidly. The hope is that, with more economically viable lands, their internal economies will begin to take shape. There is that incentive, I guess you could use that word.
Senator Tkachuk: Is there evidence of that?
Mr. Youssef: We know that there have been land selections in the past that had developments on them where opportunities may have been lost because a deal could not be reached in a timely fashion with the third party because of the gap, which Mr. Sisson alluded to earlier, in the First Nation's ability to consent to a lease and those kinds of instruments, so opportunities have been lost in the past. As land selections proceed more rapidly with these volumes, there will be more. We are trying to forestall future losses of opportunity.
Ms Shalapata: I am aware of only one. I have some data in my office. I remember that Red Pheasant had a third party interest where there was an oil interest on a piece of land they had selected. As a result of the slow process, they lost out on certain revenue and they sued our department on the basis of the length of time it took us to develop a lease that was acceptable to Canada and the gas company.
Senator Tkachuk: Did they win their suit?
Ms Shalapata: We negotiated a settlement.
Senator Tkachuk: Is life better on Red Pheasant reserve now?
Ms Shalapata: I would think so. They now have more revenue coming in.
Senator Tkachuk: You say that when they lay claim you want the settlement to be made quicker because economic development opportunities will build a better life on a particular reserve. Is there evidence of that?
Mr. Sisson: Anecdotally, there is evidence of that. In Alberta, one of our earliest treaty land entitlement claims was the Mikisew Cree First Nation, in the far northeastern corner of Alberta. They have done very well. They have since developed many First Nation businesses. They have relatively high levels of employment and low levels of dependency. Is there an absolutely pure correlation? We do not have any statistical information in that regard, but my gut feeling would be that there is. That does not generally happen the day the deal is signed, however. I believe the Mikisew process has been in the works for 16 years. Relative to other First Nations in Alberta, there have been fairly positive developments.
Mr. Youssef: The largest implementation experience has been in Saskatchewan with the seven or eight years under the framework agreement. That agreement had requirements that shortfall acre quantums be addressed first. The framework agreement had per-acre price limits, which meant that the acquisitions were generally of agricultural lands that tended to have fewer interests on them. As they move into more land selections that involve equity acre quantums, where there are no per-acre price limits, they are choosing to use their settlement funds to buy more economically advantageous lands.
As we get into further equity acre land selections, we will see more economic opportunity selections than we have in the past. There is a volume of experience in terms of the benefits that have resulted in the past, but more benefits are certainly expected. I do not know if I have adequately portrayed that.
Ms Shalapata: We do have data on that economic development, and I can certainly provide that.
However, it might be too soon to tell whether the quality of life has improved over the past five years. One example of success is the Muskeg Lake reserve, in Saskatoon. They have certainly created job and business opportunities. They have built successful relationships with the city and others in the area. Another example would be the casinos that were created jointly with the province with the resulting employment and the offshoots of business from those casinos.
Senator Tkachuk: I would argue with you on the subject of the casinos.
Ms Shalapata: Casinos create employment.
Senator Tkachuk: My concern is that this land is not fee simple. While you may have a piece of land that is producing some oil right now, oil is a depleting resource. In an enterprise economy that land would be sold and the money would be used to buy other lands to develop an oil business. They will not develop an oil business by leasing land because when the resource is depleted, there will be no more money coming in; it will be gone forever. That is why I am asking these questions. I fear they will not sell the land to buy new land with new opportunities.
Mr. Sisson: There are multiple interests on behalf of First Nations in the settlements. In Alberta, for treaty land entitlement, generally speaking, the land is selected in the vicinity of where they have lived. It is the nature of much of Alberta that that includes some oil and gas. You either end up with a patchwork reserve where pieces are excised, or you find some mechanisms by which you can give them a relatively contiguous land base.
The situation is different in Saskatchewan, where land will be selected for economic opportunity. They are not looking for lands to put the community on; they are looking for lands to drive business opportunity. We are starting to see more of that. That may lead to the question you asked in terms of whether they select land for short-term economic benefit or for a longer-range business opportunity. We are starting to see that, but it is too early to say.
Senator Tkachuk: There were concerns about how the reserve would work with the city, because the reserves would be unique jurisdictions within city limits. It seems to be working out very well. It was a wise decision by Muskeg. It was a wise decision of the province and the city to cooperate. There will be long-term benefits in the real estate business, especially.
Mr. Youssef: This bill is a tool to deal with third party interests. For that reason, it will also be another tool in First Nations armouries to design economic development plans, because they will be able to pick economically viable lands and deal with the third parties. It is up to the First Nations to strategize for themselves on their community development goals, given that they will receive claim settlement lands and deal with the interests on those. That will be a component of the community development plan that they will be developing. If they make a decision to get into a non-renewable resource land selection that will be a decision they will make for themselves.
Senator Sparrow: In regard to spot leases for oil and gas, the third party has the mineral rights to the whole piece of land. It is based on a quarter section of land on which one would have the mineral rights. What happened in those cases? You only referred to a specific oil well. If there is a specific oil well on a quarter section of land someone owns the mineral lease on the whole quarter section. How do you handle that situation?
Mr. Sisson: It is two distinct issues — the surface and the subsurface. The first consideration is that, if they have the right to the whole section of land for oil production, they have the subsurface mineral rights. That is something a First Nation could attempt to acquire. Generally speaking, in Alberta we try to get the surface and subsurface rights when we are putting a reserve together.
That is not always possible, however, if you have a third party who is not interested in having an arrangement. In those cases, we have what we call the ``keyhole'' where we carve out a small surface access piece, and enough room for a drill site or a producing well, and then we work with companies to identify where that would be in events that they have explored but where they have not actually started production. The subsurface would remain outside of the reserve until such time as production is complete. Then the site would be reclaimed. The Province of Alberta has an agreement with us to turn those sites over to us to put them back into reserve.
That is how we have been dealing with the situation. We would prefer to at least offer the opportunity of replacing that provincial disposition, both the surface and the subsurface, with something that is comparable on a federal basis. This legislation actually gives us a much better tool to work with on those kinds of arrangements.
Senator Sparrow: The surface rights go with all lands. There is no differentiation between a surface right and a subsurface right. The gravel on the surface belongs to the land.
Mr. Youssef: Senator, I believe you are delving into the issue of surface rights regimes. This legislation will help parties reach agreements where they are in agreement about what they want to do. The issue of surface rights has been flagged for us by the Alberta government and by others. Surface rights laws generally regulate relations between the surface owner of lands and the subsurface owner or lessee of mineral interests. In general, the surface rights regimes are characterized by rules of acquiring access to the surface of the land in order to explore your subsurface interest, and they also deal with dispute resolution mechanisms that help parties arbitrate surface access rights.
Plans are underway in the department to look at the situation across Alberta. Pursuant to the new Loon-Alexander settlement there was a commitment to deal with surface rights. We are planning on looking at that with an Alberta- wide and perhaps Prairie-wide approach to determine what surface rights regime is needed. A surface rights regime would change the reserve management regime that presently exists on reserves as governed by the Indian Act and other Indian reserve legislation. This legislation does not deal with changing the existing reserve management regime that gets us into that management regime. Surface rights are not part of this issue.
That said, however, the ability to reach lease terms to a certain extent helps you solve some of the surface rights issues. The parties may be able to put into their agreements terms on surface rights, but there is more work to be done on the whole issue of surface rights and it is something the department is looking at, but it would be broader than just claims-based additions to reserves.
Senator Sparrow: On existing reserves, the mineral rights are with the federal Crown in any event, so the addition then to reserves of mineral rights would be with the third party. Does this then deal with that situation? Must there be negotiation for mineral rights on that section of land? Can it have reserve status with someone else still owning the mineral rights on that land?
Ms Shalapata: Under the Treaty Land Entitlement Framework Agreement, First Nations have to acquire both the surface and the subsurface, the minerals. In most cases, the province owns the minerals, but if there is freehold ownership, they have to try to find the owner and buy the minerals. Those are then transferred to the First Nation. After a shortfall, land can be transferred without the minerals. In other specific claims agreements they can just purchase the surface.
Mr. Youssef: We call those ``surface only'' reserves where we have conferred reserve status on just the surface. While there are not many of those, that has been done in the past.
As Ms Shalapata indicates, where subsurface interest holders have the freehold, the first attempt will be to try to acquire that freehold title from them. Where they are a lessee under a provincial lease, the attempt will be to preserve that interest but, essentially, having the First Nation in Canada as owner of the lands become the lessor to the lessee, and have the minerals added to the reserve, but preserving a lease to the third party. There would still be a lease; however royalties would be paid to a different party.
Senator Christensen: Do numbered treaties deal with subsurface as well as surface rights?
Mr. Youssef: The treaties do not deal with those.
Senator Christensen: In the land claims agreements that are negotiated there are A lands, B lands, with A lands usually pertaining to the surface. Do the numbered treaties have surface and subsurface?
Mr. Youssef: The treaties indicate that First Nations will be provided with so many acres. I believe it is usually 125 acres for a family of five, but it does not say whether those will be surface or subsurface. This issue is viewed holistically in the settlements. They generally try to get the rights to the minerals.
Mr. Sisson: As a matter of practice in the treaties, both the surface and subsurface became reserve. An early reserve will have both surface and subsurface.
Mr. Youssef: Under the Natural Resource Transfer Agreement of the 1930s with the three Prairie Provinces, they are constitutionally required to transfer back to Canada lands sufficient to meet treaty obligations and that generally means all of the land.
Senator Sparrow: You referred to 125 acres. Is it not 640 acres per family?
Mr. Sisson: It would be 640 per family of five, or 128 per person.
Ms Shalapata: Different treaties have different formulas.
Senator Sparrow: Is the 125-acre amount for an individual?
Mr. Sisson: Yes. It is actually 128 acres.
The Chairman: It is fine to pass these bills, but have you developed the process? From my understanding in the Manitoba Act the process has not yet even been established on how to negotiate, implement and work with Manitoba on this.
Mr. Youssef: As indicated earlier, most of the provisions of the bill do not need the design of new processes and procedures. Pre-reserve permits will be using the same forms as on-reserve permits. The conduct by the First Nation of their designation votes will follow the on-reserve designation procedures. We needed to design new instruments with respect to the minister's conferral of reserve status and the minister's power to accept a pre-reserve designation.
None of the First Nations in Manitoba who has opted in had land selection reach that point yet where they needed these powers. We are in the final stages of designing those forms and procedures, those internal routing procedures, that will support these new forms going up to the minister. We certainly will have these in place very shortly and well before any First Nation in Manitoba needs them. Of course, the same procedures will apply to Bill C-37 once it is enacted.
The short answer is no one has needed them up to now but we are in the final stages of preparing them.
The Chairman: Our committee has asked any of the First Nations that are involved with this bill to come forward to make presentations, and we have not been successful in that regard. Do you have anything in writing to indicate that the First Nations and the provinces are supporting this? We need something to assist us because we must hear both sides.
Mr. Youssef: As I indicated earlier, consultations were with all First Nations that had existing claims settlements listed in the schedule, and they received copies, as did the provincial governments and the Aboriginal groups like the treaty executive directors.
We can provide you with copies of the letters we received from the two provincial governments, as well as from the First Nations of Loon and Alexander. We also have a letter from the Manitoba Treaty Land Entitlement Committee with respect to amendments to the bill. By and large, the other First Nations have been taking a wait-and-see attitude toward this bill because it is by opt in. They will make their decision as and when land selections reach that point. We can provide copies of the letters we have from Loon, Alexander and Manitoba Treaty Land Entitlement Committee, and the provinces. We can leave those with you since I believe we have those with us today.
Senator Gill: Will you provide us with all claims across the board?
Mr. Youssef: We will provide you with a national total. Do you want us to go back to the beginnings of the specific claims policy to see how many have been filed and resolved?
Senator Gill: Yes, as As well as the claims from other provinces.
Mr. Youssef: You are dealing with specific claims and treaty land entitlements, not with comprehensive claims. We will provide those, and Ms Shalapata has also undertaken to provide economic development data for you.
The Chairman: If there are no other questions or comments, I thank the witnesses very much for this most interesting presentation. If you could provide us with some of those letters, we would appreciate that.
The committee adjourned.