First Nations Fiscal Management Act
Budget 2018 proposes to invest $50 million over five years, and $11 million per year ongoing, to strengthen the First Nations Financial Management Board, the First Nations Finance Authority and the First Nations Tax Commission.
This optional legislation provides First Nations with support and tools to strengthen their communities and build their economies.
About the act
While all First Nations have the authority to pass by-laws related to the taxation of land under the Indian Act, the First Nations Fiscal Management Act (FNFMA) provides First Nation governments with authority over:
- financial management
- property taxation and local revenues
- financing for infrastructure and economic development
Participating First Nation governments are also supported by the First Nations institutions established under the act. The act contributes to the well-being, economic and community development and greater self-determination of First Nations.
The First Nations Fiscal and Statistical Management Act came into force on April 1, 2006 and was officially renamed the First Nations Fiscal Management Act (FNFMA) on April 1, 2013. The act enables First Nations to participate more fully in the Canadian economy while meeting local needs by:
- strengthening First Nations real property tax systems and First Nations financial management systems
- providing First Nations with increased revenue raising tools, strong standards for accountability, and access to capital markets available to other governments
- allowing for the borrowing of funds for the development of infrastructure on-reserve through a co-operative, public-style bond issuance
How to participate in the FNFMA
Participation in the FNFMA is optional. In order to participate, a First Nation must submit a Band Council Resolution to the Minister of Indigenous and Northern Affairs requesting that they be added to the schedule of the FNFMA. This process takes about three months from the time the Band Council Resolution is received.
Once a First Nation has been added to the schedule of the FNFMA, it can begin working with any or all of the First Nations institutions established under the act:
- The First Nations Tax Commission (FNTC) is a shared-governance corporation that regulates and streamlines the approval of property tax and new local revenue laws of participating First Nations, builds administrative capacity through sample laws and accredited training, and reconciles First Nation government and taxpayer interests.
- The First Nations Financial Management Board (FNFMB) is a shared-governance corporation which assists First Nations in strengthening their local financial management regimes and provides independent certification to support borrowing from First Nations Finance Authority and for First Nations economic development.
- The First Nations Finance Authority (FNFA) is a non-profit corporation that permits qualifying First Nations to work co-operatively in raising long-term private capital at preferred rates through the issuance of bonds, and also provides investment services to First Nations.
The institutions work together to improve the ability of First Nations governments to address the social and economic well-being of their communities, while providing the practical tools available to other governments for modern fiscal management.
The FNFA issued its inaugural bond of $90 million in June 2014. $50 million was added to the bond in July 2015, $110 million in May 2016, and $126 million in October 2017, for a total of $ 376 million. The 41 participating First Nations are using the funds raised by the FNFA to support infrastructure and economic development projects for their communities.
First Nations participating in the FNFMA
Since 2006, 229 First Nations are scheduled to (or participating in) the FNFMA, and more are asking to be added on a regular basis.
- 113 of these First Nations now collect tax under the FNFMA
- 106 have had their financial performance certified by the First Nations Financial Management Board
- 73 have qualified as borrowing members for purposes of First Nations Finance Authority borrowing
Participation in the act is optional. First Nations communities choose whether they will participate in the taxing and borrowing regimes created under the act and subsequent regulations.
The chart below summarizes First Nation participation in the act by province and territory.
Learn more about the FNFMA
- Read the First Nations Fiscal Management Act
- A Report to Parliament on the Legislative Review of the First Nations Fiscal and Statistical Management Act – March 2012
- Evaluation of the Implementation of the First Nations Fiscal and Statistical Management Act
The First Nations Gazette, officially launched on June 21, 1997, provides public notice of by-laws, laws, land codes, and other legislation enacted by First Nations. The First Nations Gazette is published by the First Nations Tax Commission in conjunction with the Native Law Centre of the University of Saskatchewan. To date, 369 First Nations have issued public notices through the First Nations Gazette. 6,796 by-laws, laws and land codes have been published and made directly accessible to First Nation citizens, leaseholders and other residents living on reserve lands, electors, legal practitioners, and those with commercial and other interests in reserve land.
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