Quite often, legislation affecting First Nations is met with distrust due to a historically poor relationship between Ottawa and the Aboriginal Peoples of Canada. First Nations fear a hidden agenda of title extinguishment or an abandonment of the government’s fiduciary duties. However, the First Nations Fiscal Management Act or “FMA” is an exception.
The FMA was a First Nation-led initiative, which resulted in opt-in legislation that, as stated on the Canada Gazette website, “supports economic development and well-being in First Nation communities by enhancing First Nations property taxation, creating a First Nations bond financing regime and supporting First Nations’ capacity in financial management. These objectives are achieved through the First Nation fiscal institutions established through the Act.”
Three institutions were created through this Act: the First Nations Tax Commission (FNTC) headed by Chief Commissioner Manny Jules, provides regulatory support to First Nation property tax jurisdiction. To date, it has approved over 760 laws under the act, and FMA First Nations are generating over $42 million in property tax revenues annually, enabling these nations to leverage such own-source revenue to securitize long-term loans.
The First Nations Financial Management Board (FMB), led by Harold Calla, promotes improved financial literacy by setting standards related to financial administration laws, financial management systems and financial performance and, on the request of a First Nation, certifies that First Nation as having met those standards.
Finally, the First Nations Finance Authority (FNFA), headed by Ernie Daniels, is a special purpose, not-for-profit corporation governed by those First Nations that constitute its borrowing members. Currently there are 39 borrowing members and five that are in the process of becoming borrowing members. To date, approximately 150 first nations have requested that the Minister permit them to use the act and the services of the institution.
On March 23, 2005, just over ten years ago, the Act received Royal Assent, having passed through both houses with all-party support. 10 years later, 147 First Nations, 25% of all First Nations in Canada, use this legislation. They have raised over $220 million in local revenues and issued a $90 million debenture. More than 50 First Nations have received financial management certification. Over 100 First Nations students have taken university-accredited courses to use this legislation. More First Nations want to join, even some that originally opposed the legislation.
Even with such success, there are queries and practical implementation issues that have arisen; these were raised during the review mandated to take place seven years after the Act received Royal Assent. Aboriginal Affairs and Northern Development Canada (AANDC), in consultation with the three financial institutions have been working on amendments designed to accelerate and streamline participation in the Fiscal Management Act; to reduce the administrative burden on participating First Nations; and to strengthen investor and capital market confidence in the FMA.
I would urge the Honourable Senators to support any recommendations that may be presented for our consideration and congratulate the First Nations Tax Commission, the First Nations Financial Management Board, and the First Nation Finance Authority on their continuing success on the occasion of their tenth anniversary.