Frequently Asked Questions - The First Nations Oil and Gas and Moneys Management Act (FNOGMMA): Moneys Provisions
What is the First Nations Oil and gas and Moneys Management Act?
The First Nations Oil and Gas and Moneys Management Act is federal legislation that provides First Nations the option to manage moneys currently held in trust for them by Canada. First Nations can also opt to manage and regulate on-reserve oil and gas activities through the Act.
Must a First Nation have oil and gas on its reserve to opt into the Moneys portion this legislation?
Any First Nation that has capital and/or revenue moneys held for them in trust by Canada may apply to opt into the moneys portion of FNOGMMA, and does not need to have oil and gas resources on reserve.
How is FNOGMMA different from the Indian Act?
Unlike the Indian Act, which requires the Minister's approval of First Nation expenditure requests, First Nations under FNOGMMA will no longer need to seek Ministerial approval to expend or manage their capital and revenue trust moneys. FNOGMMA provides opting-in First Nations with total flexibility, subject to community approval, to manage trust moneys, including making investments which are currently prohibited under the Indian Act.
Will "section 69 authority" of the Indian Act continue to apply to First Nations opting in to this legislation?
FNOGMMA gives participating First Nations the full authority to manage all Indian moneys, regardless of it being capital or revenue. Sections 61-69 of the Indian Act cease to apply to moneys paid to First Nations under FNOGMMA.
What is the process to opt into FNOGMMA?
A First Nation wishing to opt into the moneys provisions of the legislation follows these steps:
- express intent to opt into FNOGMMA by Band Council Resolution
- develop a financial code setting out how the moneys will be managed
- conclude a payment agreement with the Minister
- inform its members through community meetings
- have its members approval the financial code and the payment of moneys through a ratification vote
At what point are moneys paid to the First Nation under this legislation?
Once all the steps outlined above are completed, moneys currently held in trust by Canada will be paid to the First Nation in accordance with the payment agreement, as well as future moneys collected or received by Canada.
Where can the money be held?
The First Nation has the option of placing trust moneys received from Canada into either a bank account or a trust, depending on the arrangement upon which the community has decided.
Who will be accountable for the moneys transferred, and to whom?
The First Nation council will be accountable directly to its band membership for the management of its moneys once transferred. The financial code ratified by the First Nation governs the way that the moneys will be held, managed and expended.
If the financial code dictates that money will be held in a Trust, then the trustee is ultimately accountable for following expenditures as per the Trust Agreement between the First Nation and the trustee. If the funds are to be placed in a bank account, then it is the Chief and Council who are ultimately accountable for their membership, in accordance with their financial code.
What are the benefits of managing trust moneys through FNOGMMA?
The benefits for First Nations opting into the moneys provisions of FNOGMMA are:
- increased flexibility in the management of moneys
- more ability to invest moneys to address the community's needs and aspirations
- that First Nations no longer need to request approval by the Minister of Indian and Northern Affairs Canada to expend or manage their trust moneys.
What would hinder a First Nation's eligibility to opt into this legislation?
Any one of the following circumstances would hinder a First Nation's eligibility to opt into FNOGMMA:
- outstanding Ministerial Loan Guarantees in excess of funds to be transferred
- pending election appeal
- issues related to financial management of program services or Indian Moneys
- rescinding an original Band Council Resolution request
Once under this legislation, can a First Nation withdraw?
No. The legislation does not have an "opt out" or reversion to the Indian Act provision.
Is there any funding available to First Nations wanting to apply?
Formula based, phased funding will be provided to assists First Nations with the costs of the financial code, payment agreement and community vote.