Indigenous Land Title Initiative

Year: 
2017

Business Issue

An antiquated and cumbersome land “ownership” system for Indigenous lands has limited the ability of First Nations to leverage the value of their property, hindering them from achieving their full economic potential and highest and best use of their lands.  With many municipalities and regions looking for opportunities for developable lands, this inability to fully utilize potential partnerships with First Nations is hindering the growth of business.

Background

There are a number of issues hindering the ability of Indigenous communities in accessing the available potential of their lands.  Firstly, First Nations are constrained by high transaction costs, nearly four to six times higher than on non-First Nation lands. These high transaction costs arise because the legal and administrative framework to facilitate investment on First Nation land is largely missing.  Whereas the legislative and administrative frameworks for federal and provincial governments have evolved responsively over the last 140 years, the Indian Act has remained virtually unchanged.

Secondly, with respect to land tenure, the current methods for securing title on First Nation lands and the Indian Lands Registry are inadequate and they do not provide sufficient title certainty.  This is true regardless of who invests (First Nation and non-First Nation) and regardless of the type of investment (commercial or residential). The consequences of poor land title have been profound.  Land certainty is the bedrock of the investment and financial markets. Its absence has deterred investment and greatly lowered land values on First Nation lands.  It has resulted in valuable lands being put to very low value uses, as low as 10% of comparable land governed by a Torrens based system. 

During the last 30 years, First Nations have begun to legislate their way back into the Canadian economy. It started in 1988 with the first change to the Indian Act ever led by a First Nation – the Kamloops amendment. This allowed First Nations to collect property tax on their lands. Once First Nation governments derived revenues from economic activity, they began to pursue more economic activity on their lands. This meant pursuing other legislation to fill the legal and administrative gaps created by the Indian Act which include:

  • The First Nations Land Management Act
  • The First Nations Goods and Services Tax Act
  • The First Nations Fiscal and Statistical Management Act
  • The First Nations Oil and Gas Management Act and
  • The First Nations Commercial and Industrial Development Act

Missing in these legislative initiatives, is an institutional framework to improve First Nation land tenure certainty.

For several years First Nations, the federal government, and the First Nations Tax Commission (FNTC) have worked on developing land title legislation under the Indigenous Land Title Initiative (ILTI). This initiative is designed to enable First Nations who wish to choose this option to move beyond the debilitating Indian Act land tenure system, to a more modern Torrens-based system which facilitates certainty and economic growth.  Continued support from the federal government and eventual passage of the legislation for interested First Nations will lead to greater First Nation integration in the market economy.

The FNTC estimated in 2011 that based on 68 BC First Nations opting into ILTI over 15 years, $3.8 billion in increased real estate values, 27,000 FTEs in new employment opportunities, 2,700 new homes built, approximately $240 million in property and sales tax revenues, and about $160 million in infrastructure will be generated. According to the FNTC, this will result in a $1.1 billion reduction in the cost of poverty.

Summary

Conditions of the ILTI would be as follows:

  • The ILTI will allow First Nations to opt-in to a land title legislative framework as an alternative to the Indian Act following a positive vote of its membership;
  • Participating First Nations will have the option to hold legal title to the land currently held by the Crown as “reserves” under the Indian Act, and will have the power to enable all types of land tenure, including, if they choose, individual ownership without any loss of jurisdiction over the land; 
  • Participating First Nations will have expanded jurisdiction to implement a Torrens title system and to manage, develop, and protect their lands;
  • A ready-to-use legal framework of regulations and sample laws will allow ILTI First Nations to implement the legal framework for their jurisdictions efficiently and effectively;
  • The ITLI will have a profound impact in stimulating investment, reducing poverty, and strengthening First Nation participation in regional economies; and 
  • First Nations (including T’kemlups te Secwepemc, Shuswap, Skowkale, Aitchlitz, Klahoose, Upper Nicola and others) have passed Band Council resolutions of support for the ILTI initiative.

THE CHAMBER RECOMMENDS

That the federal government collaborate with First Nations to develop systems and optional ILTI legislation to improve land tenure certainty for First Nation with their undisputed lands.

References

http://news.nationalpost.com/news/canada/allowing-private-home-ownership-on-reserves-could-be-key-to-improving-well-being-for-natives-report

http://news.nationalpost.com/full-comment/jesse-kline-private-property-rights-are-key-to-the-future-prosperity-of-first-nations

http://news.nationalpost.com/full-comment/michael-lebourdais-ravina-bains-let-first-nations-thrive

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