Questions about the First Nations Property Ownership Act (FNPOA)

What is the proposed First Nations Property Ownership Act?

It is proposed federal legislation that would establish First Nation ownership of their current lands and confirm their jurisdiction over those lands. First Nation ownership would replace the existing Crown ownership and include First Nation reversionary rights and expropriation powers. It would also enable all types of lands tenure including individual fee simple ownership. FNPOA would allow First Nations to opt in to the legislative framework as an alternative to the Indian Act. The following chart gives an overview of the shift from the Indian Act system to the proposed FNPOA approach.

What are the main advantages of the proposed First Nations Property Ownership Act (FNPOA)?

• The First Nation, instead of the government, will hold the legal title to its reserve lands, opening the door to many new possibilities and facilitating all aspects of land management.
• The First Nation will have the ability, at its own discretion, to grant fee simple ownership to individuals, as well as to maintain permanent, community held land.
• The First Nation will have full land management authority, as well as broader governmental powers over First Nation lands, which will apply regardless of what kinds of ownership rights the First Nation may decide to grant.
• Through the selective use of fee simple ownership, the First Nation will be able to substantially increase access to capital for individuals (such as for home ownership) as well as for community purposes (such as community owned enterprises).
• Costs of doing business on First Nation lands will be substantially lowered; the economic value of First Nation lands will be substantially improved; private initiative and entrepreneurship will be greatly enhanced.
• The First Nation will have new tools to help address disputes related to estates and matrimonial real property.

How will First Nation lands be protected under FNPOA?

There are five important safeguards built into the proposed FNPOA:

1. Governance – expanded and permanent First Nation law-making powers regardless of what kinds of ownership rights may be granted
2. Permanent Community Held Land - set aside by decision of the community
3. Restrictions on fee simple ownership - community choice as to whether to allow fee simple ownership, how much to allow, and over which land
4. Expropriation powers - comparable to those under federal and provincial law
5. Reversionary rights - any First Nation land left without heirs returns to the First Nation

How does FNPOA differ from the 1887 Dawes Act of the United States?

In every respect!  Such as:

• FNPOA is First Nation led and controlled, while the Dawes Act was government led and controlled.
• FNPOA expands and protects First Nation governance, while the Dawes Act transferred tribal jurisdiction to the state.
• FNPOA is optional and permissive, while the Dawes Act was coercive and imposed.
• Under FNPOA the title to all First Nation land will be retained by the First Nation, while under the Dawes Act over half the reservation lands were removed from the tribes and taken by the government for sale to settlers.
• FNPOA would consolidate both ownership and governance of reserve land in the hands of the First Nation with the objective of preserving First Nation communities, while the Dawes Act deliberately broke up reservation lands with the ultimate objective of eliminating tribal communities.
• FNPOA is being deliberately designed to avoid the problems and consequences of the Dawes Act.

How does FNPOA improve on leasehold systems for on reserve development?

For some lands, a First Nation may decide to continue to use leasehold titles under FNPO because they feel leases will provide the greatest benefits to the First Nation and its members for such lands. FNPO will make those lease transactions easier by eliminating federal government involvement and through the Torrens title registry which is easier, faster and provides greater certainty to the leasehold interest. As opposed to the Indian Act, however, FNPO allows each First Nation to decide whether to permit different property interests to be held (including fee simple ownership) based on what works best for them. In some cases, such as non-member commercial development, leaseholds may be the best option. However, in some other cases fee simple ownership may be more advantageous to the First Nation's members because it provides longer term security and greater potential to create and maintain family wealth. FNPO recognizes that it should be up to the First Nation and not the Federal Government to determine which ownership options should be permitted on its lands.

Will all of a First Nation's reserve lands need to be placed under FNPOA?

No. It is proposed that the First Nation be able to decide whether to place some or all of its reserve lands under FNPOA.

Can fee simple lands be sold to anyone?

If a First Nation decides to grant unrestricted fee simple ownership to First Nation individuals, they would be able to sell the land to anyone. Even if the land is sold to a non-First Nation person, however, it will remain First Nation land under the authority of the First Nation government, who will also hold the reversionary (escheatment) interest.

What can be done to protect against the loss of First Nation ownership though mortgage default?

Although it could increase the cost of borrowing and increase First Nation liabilities, a First Nation could require (with the cooperation of lenders) that in the event of a mortgage default the First Nation has the option to buy the land in question within a specified time period before it is put on the market.

How can FNPOA help with the on-reserve housing situation?

First Nation persons holding fee simple title to their land would be able to obtain mortgages without the need of a Ministerial guarantee. These mortgage moneys could be used to either build new homes on their lands or improve existing ones.

Does FNPOA help with additions to reserves?

Once land has been approved for addition to a reserve, whether as a result of Treaty Land Entitlement or the settlement of a specific land claim or some other way, FNPOA could allow a First Nation to put this new land directly into FNPOA status. The land would then become immediately available for full economic use under the First Nation's land use and development laws.

How does FNPOA affect the ability to pass on land to children, grand children or other heirs?

Under FNPOA, First Nation persons who hold individual title to their land will be able to pass it as an inheritance to their children and heirs regardless of whether they have "Indian status" under the Indian Act.

Will the Indian Act tax exemption apply to FNPOA lands?

Yes. Under FNPOA section 87 of the Indian Act will continue to apply on FNPOA lands.

Why does FNPOA contain a new Torrens land registry?

A First Nation Torrens registry will provide a legally guaranteed title to FNPOA lands, which will provide legal certainty to First Nation land ownership and greatly facilitate all land-related transactions. By contrast, the Indian Lands Registry provides none of these assurances.

How does FNPOA affect customary land holdings?

First Nations could choose to register customary holdings in the new Torrens land registry. They could also choose to grant fee simple title to those First Nation persons who have customary holdings. These steps could greatly increase the economic value of customary holdings to those who possess them.

What is the impact of FNPOA on the Crown's fiduciary relationship?

The fiduciary relationship regarding reserve lands is the relationship between the federal government as "trustee" holding and controlling reserve land, and the band as "beneficiary". Once a First Nation takes over the ownership and management of its lands under FNPOA, the federal government will no longer be a trustee of those lands.

How will FNPOA affect treaty rights?

FNPOA only affects the way in which reserve lands are held; it does not affect or detract in any way from treaty rights. In fact, a number of First Nation leaders under treaty have commented that when treaties were signed no one imagined that the reserves would be owned by the government! In this sense, putting title to the reserves in the hands of First Nations is more in keeping with the spirit of the treaties than having reserves held by the Crown.

How does FNPOA relate to First Nations culture and history?

Some have said that permitting private ownership of land is contrary to First Nations culture and history. If a First Nation believes this to be so, and wishes to leave the question of reserve land ownership as it is under the Indian Act, then that community must be able to do so. However, there are many First Nations whose history involves economic activities of all kinds, including extensive trade relations and a variety of forms of communal and private ownership of property. First Nations today are expanding their involvement in the economy in many ways as a means to preserve and enrich their culture and create a new future for their children. FNPOA may be a useful tool in that effort.