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Secrétariat aux affaires autochtones

SPECIAL AGREEMENT CONCERNING
THE RESOURCE ENVELOPE FOR
THE DEVELOPMENT OF
INUIT COMMUNITIES

THE MINISTER FOR NATIVE AFFAIRS,
for and on behalf of the Government of Québec,
hereinafter the "Government"

AND
THE KATIVIK REGIONAL GOVERNMENT, acting through and represented by Malee Saunders, Secretary,
hereinafter the "KRG",


WHEREAS the Government's Aboriginal policy guidelines, set out in the document "Partnership, Development, Achievement", are aimed at allowing the Aboriginal nations and communities to take charge of their development and to achieve greater self-sufficiency;

WHEREAS on October 21, 1998, the Government and the KRG signed a framework agreement in which the Government agreed, among other things, to provide a resource envelope for the Inuit, for the purposes of stimulating economic development in the Kativik region, creating jobs for the Inuit and supporting the improvement and construction of community infrastructures;

WHEREAS in the framework agreement, the Government confirmed an envelope of $25 million, over five years, to be used for economic development and the financing of capital construction projects proposed by partners in the Kativik region and accepted by the Government;

WHEREAS the parties agreed to set up, as soon as possible, an implementation committee to be responsible for drawing up a draft special agreement setting out the terms and conditions of planning, management and joint actions as well as the general obligations of the parties;

WHEREAS the parties agree that such joint actions for the purposes of achieving economic development and improving or constructing community infrastructures shall not, in any way, restrict or otherwise affect the guaranteed rights of the Inuit under the James Bay and Northern Quebec Agreement;

WHEREAS the Government wishes to entrust the KRG with the management of the financial assistance program created pursuant to Section 3 of the framework agreement and described in this document, and the KRG agrees thereto;

WHEREAS the KRG Council, at its sitting of November 24, 1998, adopted resolution number 98-61 (attached), concerning guidelines for distribution of the $25 million budget envelope;

ACCORDINGLY, the parties agree as follows:

1. Purpose

The purpose of this agreement is to establish the terms and conditions of planning, management and joint actions, as well as the general commitments of the KRG and the Government in respect of Section 3 of the framework agreement signed by the parties on October 21, 1998, and concerned in particular with a resource envelope for the development of Inuit communities.

2. Application Framework

The Government shall provide a resource envelope of $25 million over five years, to be used to fund economic development projects (component I) and capital construction projects (component II). Of this resource envelope, a maximum amount of $5 million is reserved for component I and a maximum amount of $20 million is reserved for component II, including the management fees paid to the KRG. The terms and conditions for the implementation of these two components are described in Appendices 1 and 2, which form an integral part of this agreement.

With respect to component I, the KRG shall provide the Minister for Native Affairs with a list of projects likely to be undertaken during the year, as well as any subsequent changes to that list.

With respect to component II, the KRG shall provide the Minister for Native Affairs with an annual plan describing the projects to be undertaken during the year. The plan shall be authorized by the Minister for Native Affairs. The Minister, the proponent and the financial institution chosen by the proponent shall sign an agreement establishing the terms and conditions of subsidy and of the resulting funding. The letters of acceptance shall include the Government's commitment to pay the debt service of accepted projects. The Minister for Native Affairs shall obtain beforehand the opinion of the appropriate Government departments on the proposed plans submitted by the KRG.

Program Management

The KRG shall be responsible for managing the resource envelope for economic development and capital construction projects. Accordingly, the KRG shall:

  • Analyze the eligibility of the projects submitted;
  • Be responsible for auditing and monitoring the projects;
  • Pay financial assistance to the various beneficiaries of component I and obtain audited financial statements for the projects receiving funding, wherever possible, or a resolution of the board or directors, or an attestation from the proponent certifying that the assistance granted was used for the purposes of the selected projects, and that the said projects have been completed;
  • Provide the Secrétariat aux affaires autochtones with a detailed list of all component I assistance granted;
  • Provide the Secrétariat aux affaires autochtones with completion certificates of component II work as well as financial statements for the projects receiving funding, audited wherever possible, or a resolution of the board of directors or an attestation from the proponent certifying that the assistance granted was used for the purposes of the selected projects, and that the said projects have been completed.
  • Be responsible for coordination between the Secrétariat aux affaires autochtones and the project proponents.

For this purpose, management fees in the amount of $150,000 for component I and $300,000 for component II shall be paid annually to the KRG by the Government, representing 9% of the $25 million resource envelope over five years. For the first year of the agreement, the said management fees shall be paid to the KRG in a single amount, on July 15. In subsequent years, they shall be paid to the KRG in two equal instalments, on January 15 and July 15 de chaque année de l'entente.

The parties agree that requests for payment arising out of the implementation of this agreement may be audited by the financial comptroller who, for this purpose, shall have all the powers mentioned in sections 9, 10, 11, 12 and 13 of the Act respecting public inquiry commissions (R.S.Q., c. C-37), including the power to take cognizance of and examine all registers and documents he or she considers necessary for the audit.

Terms and Conditions for the Payment of Financial Assistance

For component 1

Within thirty days of receipt by the Government of a list of projects likely to be undertaken during the year, and for the first year of the agreement, of the KRG's investment policy, the Government shall pay an initial instalment of $500,000, in the form of an advance. Subsequently, successive instalments of $250,000 shall be paid, provided the KRG submits to the Minister for Native Affairs a document certifying that the balance of the transfer minus the disbursements made by the KRG is less than $100,000, and a report indicating the amounts committed and disbursed per project, the proponents receiving assistance, the contributions of the proponents to the project costs, and the form of financial assistance granted (loan, loan guarantee, subsidy).

The KRG's investment policy, and any changes thereto, shall be submitted for approval by the Minister for Native Affairs.

For component II

The KRG shall provide the Minister for Native Affairs with an annual plan, which shall be approved by means of a letter of acceptance and an undertaking to reimburse the debt service for every project contained in the plan. The KRG shall then coordinate the selected projects with the proponents. It shall also provide the proponents with technical assistance and sign a contractual undertaking with each proponent.

The parties to this agreement agree that the leisure centre constructed on the land of the Northern village of Inukjuak, for which the Minister for Native Affairs undertook, in a letter dated April 23, 1999, to reimburse the service of the debt contracted by the Makivik Corporation up to a maximum amount of $4 million, is not subject to a 20% contribution by a source other than a Government department listed in Appendix 2.

3. Amendments

The parties may agree by mutual consent to amend this specific agreement and its appendices. However, all amendments must be made in writing and signed by the duly authorized representative of each party.

4. Representatives of the Parties

The Government designates the Deputy Secretary General of the Secrétariat aux affaires autochtones as its official representative for the purposes of this special agreement.

The KRG designates the Manager as its official representative for the purposes of this special agreement.

If it becomes necessary to replace a representative of one of the parties, the said party shall do so as quickly as possible, and shall notify the other party in writing.

5. Implementation of the Special Agreement

A joint committee shall be established on the date on which this special agreement is signed, to be responsible for implementing the said agreement and for providing the parties with all relevant advice in this respect.

The committee shall be composed of two representatives of the KRG and two representatives of the Government.

The committee shall meet as required, or where possible, once every four months. It shall report periodically to the representatives of the parties on the results achieved and the difficulties encountered in the implementation of the special agreement. It shall give its opinion to the representatives of the parties whenever a dispute arises concerning the application of the special agreement or during requests for amendments to this agreement.

6. Duration of Specific Agreement

This agreement takes effect on January 1, 1999, and shall remain in force until December 31, 2003, inclusively, unless the parties agree in writing to a shorter duration.

7. Reports

On April 30 of each year, the KRG shall provide the Minister for Native Affairs with a review of project implementation for components I and II, for the preceding financial year.

IN WITNESS WHEREOF the parties have signed this text, at _____, on June _____ 1999. The French version of this special agreement, signed in duplicate, shall be authentic. The parties have also signed copies in English.

The Kativik Regional
Government
The Gouvernement du Québec
________________________
Malee Saunders
Secretary

Witness


________________________
Johnny N. Adams
President of the Administrative Committee

________________________
Guy Chevrette
Minister for Native Affairs



Appendix 1

Component I "Economic Development Resource Envelope"


Eligible Client Groups

  • For-profit organizations owned majoritarily by Inuit interests, within the meaning of the James Bay and Northern Quebec Agreement;
  • Non-profit organizations, owned majoritarily by Inuit interests within the meaning of the James Bay and Northern Quebec Agreement, carrying out socio-economic activitie;
  • Cooperatives the majority of whose members are Inuit within the meaning of the James Bay and Northern Quebec Agreement.

Eligible Projects

Eligible projects are those that comply with the KRG investment policy and that appear on the list of projects likely to be undertaken during the year, as submitted to the Minister for Native Affairs.

All these projects must have an impact on the consolidation of gains and the economic development of the Kativik region, and must have one of the following characteristics:

  • Respond to a given situation;
  • Promote job creation;
  • Improve the quality of life of the Kativik region's inhabitants;
  • Be of a structuring nature;
  • Have a lever effect or provide an impetus for economic, social or cultural
    development.

Eligible Costs

Eligible costs are those related to eligible projects, including those related to market surveys, and may not exceed $250,000 per project.

The portion assigned to the cost of market surveys may not exceed 10% of the economic development resource envelope.

Costs related to the operating expenditure or working capital of an business enterprise are not eligible, except for the financing of inventories through loans or loan guarantees.

Conditions to be Met by the Project Proponent

  • Present a business plan;
  • Prove the ethnic ownership of the business or cooperative, by submitting its partnership agreement or a list of its members;
  • Have its head office within the Kativik region;
  • Carry out a substantial part of its operations within the Kativik region;
  • Contribute at least 20% of the cost of the project. At least half of this contribution must be in the form of direct financing by the proponent. The other half of the 20% which is not in the form of direct financing by the proponent must comprise an amount from a source other than a Government department (for example, the Makivik Corporation or the Northern villages, etc.).

Application Framework

This program offers applicants a triple potential for financial assistance. Financial assistance may take the form of a direct subsidy to the recipient, a loan to the recipient and/or a guarantee applicable to a loan taken out by the recipient in its own name from a financial institution.




Appendix 2

Component II "Community Infrastructure and Equipment Resource Envelope"


Eligible Client Groups

  • The Northern Villages;
  • Non-profit organizations;
  • The Kativik Regional Government, the Nunavik Regional Health and Social Services Board, the Kativik School Board, the Inuulitsivik Hospital and the Tulataavik Hospital, provided all the needs of community organizations, not-for-profit organizations and other regional organizations have been met.

Eligible Projects

To be eligible, projects must:

  • Be considered priorities and of interest to the community;
  • Have impacts on the economy, the employment situation or land use planning;
  • Have guaranteed funding sufficient to cover the operating costs of the newly constructed infrastructures or new equipment, as the case may be.

Eligible Infrastructures and Equipment

Infrastructures and equipment relating to eligible projects, except for municipal infrastructures eligible for the "Isurruutiit" program, and hospitals, schools, detention centres, airports, wharves and heavy rolling stock.

Eligible Work

Eligible work is work related to:

  • The rehabilitation, repair, reconstruction, enlargement or replacement of existing community infrastructures;
  • The construction of new infrastructures.

Acquisitions or replacements of community equipment are also eligible. Work related to the implementation of infrastructures to allow for the development of new residential or commercial neighbourhoods is not eligible.

Eligible Costs

Eligible costs include:

  • The cost of carrying out eligible work;
  • The cost of acquiring and replacing community equipment;
  • Incidental expenses.

Financial Assistance

The financial assistance granted may not exceed 80% of the total cost of all projects presented in the annual plan. Capital expenditures for community infrastructures shall be amortized and financed in the long term by the proponent on the basis of their useful life. The Government shall reimburse the capital, the interest and the incidental expenses for each project.

The additional funding of 20% shall come from a source other than a Government department (for example, the Makivik Corporation, the Northern Villages, etc.).

Signature gouvernementale
Secrétariat aux affaires autochtones
905, avenue Honoré-Mercier, 1er étage - Québec (Qc)  G1R 5M6 - 418 643-3166
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