It is the second day of the Haida’s annual House of Assembly, a four-day legislative session open to all 4,000 members of the Haida nation. Inside a red-roofed community hall on the Skidegate First Nations reserve on the southern end of Haida Gwaii, on a beautiful, crisp October afternoon, the atmosphere is tense. About 100 members of the Haida nation are sitting inside at tables, midway through a six-hour debate on their economic future. A middle-aged woman, her hair held with a Haida-style brooch and a red shawl hanging over her shoulders, exits the building in tears, hands shaking, swearing. Shouts and raised voices can be heard through the half-open door of the hall, its windows facing out onto the always-windy Hecate Strait. A changing cast of a dozen men and women are standing outside, dragging on cigarettes and continuing arguments from inside.
The day’s gusty breezes fit this afternoon’s debate: a proposal by Vancouver-based NaiKun Wind Energy Group Inc. to build Canada’s first offshore wind farm, one of the world’s largest, at a cost of more than $2 billion. The Haida government’s executive body, the Council of the Haida Nation (CHN) – which includes the directly elected president and vice-president, six regional representatives and two band council representatives – has agreed to give NaiKun access to a 31-square-kilometre stretch of Haida-claimed waters. There, between the islands of Haida Gwaii and B.C.’s mainland, the company plans to install up to 110 turbines, each six metres wide, towering 80 metres above the water and buried 25 metres into the sea floor. In exchange for its support of the Hecate Strait wind farm, NaiKun has agreed to give the Haida’s wholly owned development company, HaiCo, a 50 per cent stake in NaiKun Wind Operating Inc., which is responsible for the day-to-day operation of the wind farm. NaiKun has also offered to sell a 40 per cent stake in its power generation company, already 50 per cent owned by Calgary-based EnMax, to HaiCo for $800 million (to be financed with a federal government loan guarantee). Haida leaders expect their investment would generate $20 million a year and provide up to 50 jobs in the community.
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Power Player: Council of the Haida Nation president GuujaawWhile CHN leaders fully support both of these deals, they still need the approval of the people, and that, as the tenor of today’s debate indicates, could prove a tall order. Some of the Haida standing with me outside the hall during a break say they embrace the project as an opportunity for their band to escape poverty and dependency. Others express deep suspicions of NaiKun’s financial promises. All note their sacred duty as Haida to protect their lands and waters from environmental damage. So many want their turn to speak at the microphone that guest speaker David Suzuki, an honorary Haida as well as a wind power advocate, had to be bumped from the lineup. All differences, big and small, must be fleshed out before a consensus can be reached and a decision taken.
At around 6 p.m., debate wraps up for the day and weary Haida members empty out of the building and into their cars. Arnie Bellis, the large, gregarious CHN vice-president, walks with them out the door shaking hands. A forestry contractor, Bellis is serving his third term as vice-president, overseeing the CHN’s operations while playing the yin to CHN president Guujaaw’s more reserved yang. He volunteers to drive two out-of-town CHN members to their hotel in the nearby town of Queen Charlotte, and I come along for the ride. Inside Bellis’s beat-up Suburban truck, the three talk excitedly, energized from the debate. Although no decision was made, they determine the debate was successful. With time, information and steady leadership, Bellis explains, a small community can make a sophisticated economic decision intelligently. “In every democracy, you have people who are either for or against,” he says, navigating the coastal two-lane highway. “The challenge is to find ways to have the wheel of industry mesh with the circle of the culture, and sometimes that’s very complicated.” It’s a challenge that NaiKun and the Haida have already spent nearly a decade trying to solve.
With its ambitious plans for Haida Gwaii, NaiKun is trying to overcome an obstacle faced by many B.C. companies working on business agreements with First Nations communities: whether dealing with claimed, owned or reserve land, business deals are not sealed with a leader’s handshake or signature; they often require negotiation with the entire community. Many First Nations bands require, either by choice or by the Indian Act, a membership vote on major band decisions. And a series of legal decisions in the past five years means businesses increasingly see getting First Nations permission as a necessary step to accessing resources on their claimed traditional territories. According to one estimate, the number of business and government actions requiring First Nations consultation – including road and water access, as well as drilling rights – now tops 200,000 annually.
To complicate matters further, every one of B.C.’s 200 First Nations has its own political system, personalities and history, necessitating a different approach for each. Some First Nations still rely on their band governments, as set out by federal law. Others, such as the Haida, keep the local band councils while also having a directly elected national government to represent their nation when dealing with outside companies and governments. And each First Nation can often have a council of elders, who carry their own political weight. The Haida, for example, have two band councils representing 37 reserves, a national executive and 33 clan chiefs, as well as elders and matriarchs, all with their own political roles.
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Power Player: NaiKun's Matt Burns with a Haida delegation touring an offshore wind-power site in EuropeWith all these power centres, there is often confusion as to what is necessary to reach a final conclusion on a deal. A Yes vote in many communities – either by tradition or rule, or just by virtue of living in a small community – has to be something more than simple majority. “There’s a pretty strong expectation that there has to be widespread agreement amongst the First Nation itself about going ahead on these things,” says Doug MacArthur, a former B.C. deputy minister, First Nations consultant and SFU lecturer. But that doesn’t necessarily mean total agreement. Rather, according to Patrick Kelly, a First Nations consultant and former BC Hydro executive, it means that everyone who wants to has the opportunity to speak on a particular decision. If there is wide support and there aren’t too many vehement opponents, it usually counts as consensus.
If, on the other hand, a company tries to go in without wide community support, it can find itself caught in the middle of a political battle. More than 700 kilometres north of Haida Gwaii in B.C.’s northwest is the 2,300-member Tahltan nation. The Tahltan Central Council, made up of representatives from 20 families in two bands, and their pro-development chief Jerry Asp signed a provincial agreement in 2004 that, for $250,000 a year, promised that the Tahltan government would help provide an open door for future mining, forestry and hydro projects. The deal included Shell Canada Ltd.’s exploratory work for coal bed methane deposits in a 400-hectare area north of Hazelton.
But less than a year later, Tahltan elders staged a two-week occupation of Asp’s office to protest Shell’s exploration and other developments, focusing on Asp’s leadership. Members say they weren’t consulted or informed about what Shell and other companies were doing in the Tahltan’s claimed traditional territory. Without the backing of the two bands, the hereditary chiefs and the elders, the agreements meant next to nothing. Asp did not run for re-election in 2006, and the leadership change surprised Shell. Current Tahltan Chief Annita McPhee, told the company that the relationship would need to be rebuilt from the ground up. Shell then opened a community outreach office, but shut it down after the province imposed a two-year moratorium on methane development in the area in December 2008.
The lack of a framework for how companies and First Nations should reach agreement and the ability for negotiations – both with and within the First Nation – to carry on for years leads to business frustration, according to John Winter, president of the B.C. Chamber of Commerce. “The only thing business really asks for is not whether it’s Yes or No,” he says, “but, When am I going to know an answer? Time is money, and if this isn’t going to work out, let’s get on to the next project.” There are no provincewide estimates of how much economic activity is being lost through the First Nations consultation and accommodation process, but Winter is convinced many investors and companies are simply avoiding the process entirely as they watch others struggle indefinitely.
The provincial government, worried about the economic and social fallout of such avoidance, is trying to put together a best-practices guide to help companies and First Nations better navigate their relationship. “There’s never any guaranteeing that it’s always going to be successful, but I think there are some strategies that will increase the likelihood,” says George Abbott, B.C.’s minister of Aboriginal Relations and Reconciliation. Some companies, such as hydro producer Plutonic Power Corp., are already developing their own frameworks for achieving community agreement. Tom Syer, Plutonic’s director of First Nations relations, says his company works with a number of First Nations groups and always gets in contact early with a flexible business plan to show the community they are serious about consultation. Once an agreement is reached, Syer says, it must be “bulletproof in a legal and ethical sense,” in case circumstances within the community change.
[pagebreak]Being prepared for such changes is key, according to Chanze Gamble, general manager of the New Relationship Trust, an independent organization dedicated to strengthening First Nations. Most First Nations communities hold elections every two years, and with the sudden loss of an incumbent, a company may realize they don’t have wide-enough support, he says. In September the Trust released its own best-practices guide on aboriginal-business relations, highlighting the importance of understanding community needs and clear communications. “The best practice,” Gamble says, “is to inform the community and keep them informed because it raises the chances that a project is going to go ahead, even if leadership changes.”
Those sorts of measures are already part of NaiKun’s First Nations strategy, according to Matt Burns, the company’s vice-president of commercial operations and president of NaiKun Wind Operating Inc. “We absolutely need to deal with the leadership,” Burns says when we talk in mid-October, a week after the House of Assembly meeting. “But we also need to build roots in the community and make sure we don’t just have a relationship with the chief. It’s just not good business.”
Good roots are integral because NaiKun is hoping to keep expanding over the next two decades. If the wind farm plan goes ahead, it will be 2014 before NaiKun’s 110 towers and 396 megawatts of power are fully operational, and there is the potential for a further four phases of expansion up to 1,750 megawatts. To help ensure there are no surprises, the company is spending significant time and money on community outreach. About 10 per cent of the $20 million already spent on development costs – which include engineering, planning and environmental assessment – has gone to outreach in Haida Gwaii and around Prince Rupert, where transformer stations and power lines are planned for three other First Nations bands’ claimed territory. The company has opened two offices on Haida Gwaii, one each in New Masset and Skidegate, the latter one overseen by a former CHN employee. Burns flies north once a month and Lucy Shaw, the company’s director of north coast relations, visits every two weeks to meet with First Nations leaders and members to discuss the project’s progress, address concerns and close agreements. During the week of the House of Assembly meeting, Shaw sat in an office five minutes away in case questions arose requiring an answer on behalf of NaiKun.
Because of the Haida’s consensus-based politics, where chiefs are expected to listen more than they lead, some members have become suspicious of the CHN’s strong advocacy for the NaiKun deal. These critics speak of corruption and rent-seeking, of CHN leaders using regulatory positions to get plum jobs later. Letters to this effect have appeared in the local paper, and similar sentiments have been muttered in coffee shops. But Burns shakes off these opposition views, saying the criticisms I heard in October are a natural part of the Haida decision-making process and go back as far as 2002, when NaiKun executives first travelled to Haida Gwaii with plans in hand, only to have Haida leaders send them packing for not having paid proper respect to Haida processes. The company restarted its efforts, adapting its plans to Haida requirements and assuring the CHN that the project would not go forward without the Haida government’s approval. That approach, combined with the project’s inherent merit, will bring Haida members around, Burns says, just as they ultimately persuaded CHN leaders: “We’ve known when it was time for them to step up and put themselves out there, some of those folks were going to step up and point fingers. It’s part of the game.”
In an attempt to normalize their development decisions without giving up too much political control, some First Nations have started to look for new models of governance to oversee projects. An increasingly popular one is an arm’s-length company that operates much like a crown corporation: one degree removed from politics, with a mix of band leaders and business leaders – unaffiliated with either band or investing company – as board members. Band members act as shareholders, with quarterly updates and voting opportunities but with no say over day-to-day decisions. This can be especially helpful for the increasing number of aboriginal-business joint ventures. “You need to keep politics out of the business, because when it gets into business, things have a very good chance of failing,” says Howie Charters, a vice-president with Colliers International Consulting and the Musqueam First Nation’s economic development adviser. Charters is working with the Musqueam as they move toward adopting an arm’s-length corporation model to oversee more than $500 million in real estate assets in Vancouver. Other First Nations governments that have already adopted such a model include the Westbank, Sechelt, Osoyoos and Tsawwassen.
Many companies say that dealing with an arm’s-length corporation often means a smoother day-to-day business relationship, depending on how much control the band’s leaders actually cede. But in most cases, First Nations members still maintain their ability to decide through votes whether or not to accept a company’s development proposal, leaving the initial agreement process in the messy pit of politics.
[pagebreak]South of Vancouver, the Tsawwassen are considering a 300-unit retirement community development on their treaty-given land. According to their brand-new constitution, any lease of public land for longer than 25 years requires a community-wide vote, in spite of the creation last fall of an arm’s-length corporation. Tsawwassen Chief Kim Baird doesn’t see this as necessarily a bad thing: “It can be viewed as a threat, but I think if there’s proper communication, it doesn’t have to be viewed that way.” Meanwhile, Squamish Chief Gibby Jacob – who is in the process of setting up an arm’s-length corporation – says he has no desire to hold a referendum for every single business development agreement on the 120 hectares of provincial lands (in Callaghan Valley and Whistler) the Squamish received to support the 2010 Olympics. Once the corporation is set up, he says, Squamish members will have their say as shareholders: “We’re going to do the regular reporting from the board and the chair, so the transparency will be there.”
Two weeks after the House of Assembly meeting in October, a consensus of sorts was reached on Haida Gwaii: in a unanimous vote, it was decided all 4,000 Haida members would have their say in an island-wide vote on whether to support a business relationship with NaiKun. Left undecided is whether the question on the nationwide ballot would address only HaiCo’s $800-million investment or the company’s overall ability to access Hecate Strait – or when this final vote would be held. NaiKun’s Matt Burns says that CHN officials have assured his company that the investment decision is all that will come up for a vote, and he notes that CHN president Guujaaw, a NaiKun supporter, won re-election in the Haida’s December leadership elections by a wide margin. But some in Haida Gwaii are still pushing for a more general vote. “That scenario for us, at this point, is hard to contemplate,” Burns says.
Despite the decade of planning and investment, NaiKun can only sit and wait on the sideline as the Haida community makes its decision. If the question of NaiKun’s access to Hecate Strait gets voted down in a ballot, Burns indicates the company would have to rely on a contract it signed with the CHN in 2007, but he acknowledges that NaiKun ultimately could not do much. Arnie Bellis and the Haida leadership are unapologetic about the difficulties companies such as NaiKun face in locking down an agreement. If they want to do business in Haida Gwaii, they will need to play by the Haida’s rules. “It’s not a duplicate of the B.C. democratic system,” says Bellis, who is still strongly supportive of the NaiKun deal. Citizens get to decide which business developments they like and which they don’t, he says, instead of having that decision left in the hands of a bureaucratic agency or a few elected ministers.
Still, democracy is a messy business, as Bellis himself discovered when he lost the CHN’s vice-presidential post in December’s elections, leaving someone new to struggle with the contentious NaiKun decision. His victorious opponent had accused him of spending too much time off-island striking deals and not enough time overseeing the CHN’s administration. Despite his loss, Bellis continues to believe that the Haida’s governance system works well, offering the community an opportunity to become informed on an issue and then to make a democratic decision determining the future of their land, their band’s finances and their community. He also believes that as companies learn how to approach communities, and those communities get more experience dealing with companies, the process will get a little smoother.