First Nations Clean Water Initiative Atlantic Region AFN National Housing & Infrastructure Forum James MacKinnon Policy Analyst Team Leader, Housing & Infrastructure, Atlantic Policy Congress Dr. Graham Gagnon Director, Centre of Water Resource Studies, Dalhousie University Atlantic Policy Congress of First Nations Chiefs Secretariat (APC) www.apcfnc.ca Outline 2 Background What is the Atlantic First Nations Water Authority? Review of Signed BCRs A New Path Forward Current and Future Activities for 2017-2018:
Water Authority Structure Financial Analysis Engineering Analysis Next Steps Atlantic Policy Congress of First Nations Chiefs Secretariat (APC) www.apcfnc.ca Background 3 What is the Atlantic First Nations Clean Water Initiative (AFNCWI)? The AFNCWI aims to improve public health/safety for First Nations through safer water and wastewater management. Three main activities comprise the AFNCWI:
Regional First Nation Water Authority Determine Finance Models Drinking water & wastewater regulations for First Nations communities Atlantic Policy Congress of First Nations Chiefs Secretariat (APC) www.apcfnc.ca What is the Water Authority? 4 The Water Authority will be a First Nation
organization, constructed, owned and operated by First Nations. The Water Authority will not be a political organization. It will be a technical organization focused on the provision of water and wastewater services. The Water Authority will be a legal corporation and it will be run as a non-profit business. It will be an organization that is responsible for providing water and wastewater services to all communities that are participating in this project. It will be owned and led by the First Nations participating in the project. Atlantic Policy Congress of First Nations Chiefs Secretariat (APC) www.apcfnc.ca
Community Engagement is a Key Driver 5 Unity and Community Service 22 communities have signed a Band Council Resolution (BCR) agreeing to participate in Phase 1, as outlined by the charter, for the realization of a Atlantic First Nations Water Authority. Atlantic Policy Congress of First Nations Chiefs Secretariat (APC) www.apcfnc.ca A New Path Forward 6
On July 5th, 2016, APC held a meeting with INAC representatives to discuss the future direction of the AFNWA. The goal was to: Develop strategic objectives to be completed in the 2016-2017 fiscal year; Formulate an implementation plan for following years; Agree upon a clear message that both INAC and APC will share going forward. Atlantic Policy Congress of First Nations Chiefs Secretariat (APC)
www.apcfnc.ca Current and Future Activities for 20172018 7 Three major deliverables in the FNCWI-AR 2016 Proposal: 1. Corporate Structuring of the AFNWA Contract awarded to Halifax Water/Accelerator Inc. Develop recommendations for a corporate structure for the AFNWA (Complete) Development of a preliminary business plan for the AFNWA (in-progress) 2. Financial Analysis On-going
Contract awarded to Ulnooweg Development Inc. Analysis of water and wastewater expenditures 3. Life-Cycle Analysis Contract to be awarded in 2017-2018 Engineering analysis on the status of all water and Atlantic Policy Congress of First Nations Chiefs Secretariat (APC) wastewater assets www.apcfnc.ca AFNWA Corporate Structure 8 Atlantic Policy Congress of First Nations Chiefs Secretariat (APC) www.apcfnc.ca
Corporate Structuring for AFNWA Overview 9 APC released an RFP on January 19, 2017 APC awarded contract to Halifax Water/Accelerator on February 14, 2017 Final report completed August 8, 2017 Scope of work included: Outreach and engagement Develop four corporate structure
alternatives for AFNWA Cost/Benefit analysis for each corporate structure Preliminary report to present at May 24/17 Leaders Workshop Final draft report to present at July 10/17 Leaders Workshop Atlantic Policy Congress of First Nations Chiefs Secretariat (APC) www.apcfnc.ca Outreach and Engagement 10 Water Forum [March 15 & 16, 2017] Chiefs/Mayors Meeting [April 27, 2017] Elders Meeting [May 1, 2017] National Survey [April 21, 2017 to May 19, 2017] First Nation Leaders Workshop [May 24, 2017]
Operator Workshop [June 27, 2017] Elders Meeting [July 5, 2017] First Nation Leaders Workshop [July 10, 2017] Atlantic Policy Congress of First Nations Chiefs Secretariat (APC) www.apcfnc.ca Core Elements of Atlantic First Nation Water Authority 11 Atlantic Policy Congress of First Nations Chiefs Secretariat (APC) www.apcfnc.ca Governance Overview 12 The AFNWA will be governed by a 15 member Board of Directors; 12 First Nation representatives and 3 technical experts. The Elders have recommended that the First
Nation directors be selected using a skills matrix so the Board has the best directors around the table. The Elders have recommended an active Elders Advisory Council who will engage with the AFNWA to ensure that traditional values and culture are incorporated in the day to day Atlantic Policy Congress of First Nations Chiefs Secretariat (APC) operations. www.apcfnc.ca Corporate Structure Alternatives 13 Four Alternatives: o Full Service Centralized o Full Service De-Centralized
o Full Outsource [P3] o Technical Services Support Corporate structure is scalable but alternatives based on 23 First Nation communities that have passed band council resolutions; others can join. Recognition that many First Nation communities have a municipal transfer agreement with neighbor municipality or onAtlantic Policy Congress of First Nations Chiefs Secretariat (APC) www.apcfnc.ca Key Recommendations 14 Adopt a full service decentralized structure for the AFNWA incorporating a hub and spoke
approach for regional operations for optimal service delivery and stronger community relationships. Locate the main office of the AFNWA within the service corridor between Halifax and Moncton in a First Nation community to maximize local benefits and strengthen relationships. Once the decision is made to operationalize the AFNWA, contract with a professional search organization to hire the CEO and senior managers Atlantic Policy Congress of First Nations Chiefs Secretariat (APC) to ensure top talent is retained. www.apcfnc.ca Key Recommendations 15 Efforts should be made to hire all staff within
one year after the decision is made to operationalize the AFNWA, with a clear preference to hire from First Nation communities. The AFNWA should adopt a formal training and development program for all staff employed by the AFNWA. Local operators should be hired wherever possible with an immediate focus on training and certification. Atlantic Policy Congress of First Nations Chiefs Secretariat (APC) www.apcfnc.ca Key Recommendations 16 Human Resource strategies should recognize the experience and knowledge of staff
currently employed in water and wastewater system operations and take a consistent approach to salaries, benefits, training and career development. Communications and outreach are central to the success of the AFNWA and full efforts must be made to engage communities in an open and transparent manner. Atlantic Policy Congress of First Nations Chiefs Secretariat (APC) www.apcfnc.ca Full Service Decentralized 17 Atlantic Policy Congress of First Nations Chiefs Secretariat (APC) www.apcfnc.ca Full Service Decentralized [FSD] First Nation Communities &
Proposed Service Regions for FSD Alternative 19 MO Atlantic Policy Congress of First Nations Chiefs Secretariat (APC) www.apcfnc.ca Preliminary Business Plan for the AFNWA 20 Halifax Water and Accelerator Inc. are in the process of developing a preliminary business plan which will delineate the path forward for the AFNWA by highlighting key milestones for its development and early operations. The preliminary business plan will include: o
Overview of the AFNWA structures and principles o Regulatory frameworks for water and wastewater Objectives for the first year of operations of the AFNWA High Level capital and operating budgets for first five years o o Atlantic Policy Congress of First Nations Chiefs Secretariat (APC) www.apcfnc.ca Preliminary Business Plan 21 Regulatory Framework o
Water regulations as proposed by Dr. Graham Gagnon leveraging NS regulatory framework for Surface supplies and PEI regulatory framework for groundwater supplies o Wastewater system effluent regulations as adopted through the federal Fisheries Act [current national standard for municipal systems] o Proposed regulatory oversight through Environment Canada Atlantic Policy Congress of First Nations Chiefs Secretariat (APC) www.apcfnc.ca Preliminary Business Plan
22 Five Year Capital and Operating Budget AFNWA Funding Summary Five Years Annual Cost 5 Year Cost Annual Board Operating Expenses $.25 million One Time Start-Up Costs $1.25 million $1.5 million Full Service Utility with Hub and Spoke Operations $4.3 million $21.5 million
Regulatory Compliance $12 million $60 million Asset Renewal $5 million $25 million Depreciation for New Assets $5 million Integrated Resource Plan (IRP)* $3 million
TOTAL: $117.25 million $23.5 Atlantic Policy Congress of First Nations Chiefs million Secretariat www.apcfnc.ca (APC) Financial Analysis 23 Atlantic Policy Congress of First Nations Chiefs Secretariat (APC) www.apcfnc.ca Purpose 24
Ulnooweg will: o Complete a financial analysis of expenses related to water and wastewater services in participating First Nation communities across Atlantic Canada. o Using this data, Ulnooweg will aid in the development of a financial plan for the prospective Atlantic First Nations Water Authority (AFNWA). o Provide relevant financial information relative to communities current water and waste water expenses to allow Chiefs to make informed decisions on the project. Atlantic Policy Congress of First Nations Chiefs Secretariat (APC) www.apcfnc.ca Background 25 Current Funding Structure for Water and Wastewater Infrastructure and Services:
o o o INAC 80% of total W/WW O&M Individual Communities 20% W/WW O&M Health Canada Funding for the Community Based Water Monitoring Program (CBWM). Atlantic Policy Congress of First Nations Chiefs Secretariat (APC) www.apcfnc.ca Phased Approach 26 Approach Phase 1 Financial Agree on a standardized methodology for collection and analysis of financial data
Phase 2 Data Activate and undertake a community outreach and engagement process Collection and analysis of financial data Participating First Nations INAC Health Canada CURRENT STAGE Atlantic Policy Congress of First Nations Chiefs Secretariat (APC) www.apcfnc.ca Phase 3 Analysis Review of current actual costs for each participating community
Definition of the 80% - 20% split to establish the expected community contribution Gap analysis to identify funding requirements Analysis of the impact on participating communities (benefits, cost effi ciencies, impact on other programs) Assessment/description of impacts by community Work to date 27 Data collection methodologies have been developed, these include a spreadsheet and questionnaire that inquire about: o
Direct Cost: o Indirect Cost o Labor, Chemicals, Maintenance, etc. Insurance, Transportation, Phone, SCADA, Engineering. Facilities and Equipment Building, Pumping, Distribution and Collection Networks Atlantic Policy Congress of First Nations Chiefs Secretariat (APC)
Questionnaire 28 Direct Costs Labour Costs Inquiry Positions and number of people involved in the W&WW system operation Are they full time positions/employees? Do they perform other jobs not related to the W&WW system? How is the salary range determined? Are the salaries recorded in the books and how can we identify them? How do you source the chemicals? Chemicals How many chemical suppliers do you have?
Listing of chemical suppliers How do you manage the chemicals supply inventory? Atlantic Policy Congress of First Nations Chiefs Secretariat (APC) www.apcfnc.ca First Nation Community Site Visits 29 To date, a number of community site visits have been completed for the purpose of data collection with more scheduled for the near future. Communities visited to date include: Data Collection Phase o o o
o o o Potlotek First Nation Sipeknekatik First Nation Visited; 20.69% Pictou Landing First Nation Glooscap First Nation Lennox Island First Nation Abegweit First Nation Confirmed visits; 3.45% Total; 75.86% Atlantic Policy Congress of First Nations Chiefs Secretariat (APC) Engineering Analysis
30 Atlantic Policy Congress of First Nations Chiefs Secretariat (APC) www.apcfnc.ca Purpose 31 An RFP will be released for a Third Party Engineering Consulting Firm to complete a cost analysis for the infrastructure required to bring the existing water and wastewater assets, in the 22 participating First Nation communities across Atlantic Canada, into compliance with regulation, and provide a high level estimate of costs for on-going renewal of existing assets. Atlantic Policy Congress of First Nations Chiefs Secretariat (APC) www.apcfnc.ca
Background 32 Previous Studies will inform this assessment, they include: o National Assessment of First Nation Water and Wastewater Systems 2009-2011 o Atlantic Canada First Nations Water & Wastewater Asset Condition Assessment CBCL 2013 In addition to these studies, there is more data available through Indigenous and Northern Affairs Canada (INAC), and from individual communities.
Using these reports, a consultant will complete a table-top exercise to update the 2013 CBCL assessment. Atlantic Policy Congress of First Nations Chiefs Secretariat (APC) www.apcfnc.ca Next Steps 33 All deliverables will be completed by March 31, 2018 Information from the three studies (corporate structuring report, financial analysis, and the engineering analysis) will enable Chiefs to make an informed decision on whether they would like to proceed with the Atlantic First Nations Water Authority.
Atlantic Policy Congress of First Nations Chiefs Secretariat (APC) www.apcfnc.ca Thank You! 34 Questions? Atlantic Policy Congress of First Nations Chiefs Secretariat (APC) www.apcfnc.ca
