Locatee Lease Policy and Directive

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The Locatee Lease Policy and Directive 7-3: Locatee Leases (2013) replaces Directive 7-3: Locatee Leases of Chapter 7 -Leases: Drafting, Issuing and Cancelling in the Land Management Manual, 2003

Locatee Lease Policy

(This policy statement will be integrated in the Directive 7-1 of Chapter 7 of the Land Management Manual)

1. Definitions

  • 1.1. Application means an "Application for Leasing Locatee Lands within an Indian Reserve".
  • 1.2. Band Authority means Person authorized to provide feedback to the Department on behalf of the band which may include the band land manager, the band land officers and the Band Council.
  • 1.3. Band Council means the "council of the band" as defined in the Indian Act.
  • 1.4. BCR means a Band Council Resolution.
  • 1.5. CEAA, 2012 means the Canadian Environmental Assessment Act, 2012.
  • 1.6. Department or Department of Aboriginal Affairs and Northern Development or AANDC means the Department of Indian Affairs and Northern Development.
  • 1.7. Departmental Official means the Department's lands officers and lands managers carrying out departmental duties under the Indian Act.
  • 1.8. Land Management Manual means AANDC’s Land Management Manual as amended from time to time.
  • 1.9. Land Status Report means a report that contains all the pertinent information regarding the encumbrances and interests on a particular parcel of reserve land.
  • 1.10. Laws means all laws, statutes, regulations, by-laws and legally binding decisions of any authority now existing or which may exist in the future, as amended, enacted or re-enacted from time to time.
  • 1.11. Lease means a written contract granting exclusive use of lands during a specified period in exchange for a benefit.
  • 1.12. Lessee means the tenant or tenants under a Lease.
  • 1.13. Lessor means Her Majesty the Queen in right of Canada, as represented by the Minister of Indian Affairs and Northern Development.
  • 1.14. Locatee means a band member in lawful possession of lands that, with the approval of the Minister, have been transferred to him or her in accordance with the Indian Act Footnote 1.
  • 1.15. Locatee Lease means a Lease whereby the Lessor, with the consent of the Locatee, grants use of the Locatee’s lands to the Lessee for a specified period.
  • 1.16. Minister or Minister of Aboriginal Affairs and Northern Development means the Minister of Indian Affairs and Northern Development.
  • 1.17. Person means an individual or a corporation or any other legal entity.

2. Transitional Provisions

  • 2.1. The Locatee Lease Policy and Directive 7-3: Locatee Leases are effective as of July 17, 2013.
  • 2.2. The terms and conditions of existing leases executed before July 17, 2013 remain in effect, unless otherwise requested for modification by the Locatee and the Lessee.
  • 2.3. The provisions of the Land Management Manual must be interpreted and apply consistently with the Locatee Lease Policy and Directive 7-3: Locatee Leases which include the Locatee Lease Checklist-Annex A to the Directive.

3. Leasing of Locatee Lands

  • 3.1. Authority – The Department administers the leasing of allotted lands on behalf of the Locatee under ss.58(1)(b) Footnote 2 and ss.58(3) of the Indian Act.
  • 3.2. Negotiable Terms of the Lease – The Lessee and the Locatee are responsible for agreeing on the essential terms and conditions in the Lease. These elements include the identity of the Lessee, the proposed use of the lands, the duration of the Lease and the benefit to the Locatee.
    • 3.2.1. Lessee – The Lessee may be any Person legally capable of entering into a leasing transaction. At the request of the Locatee, the Minister may grant a Locatee Lease to any band member, a band corporation or a band-member corporation, the Locatee in his or her personal capacity, or a non-band member Footnote 3.
    • 3.2.2. Use of the Lands – The Locatee Lease states the proposed use(s) of the lands. Examples may include commercial, industrial, residential, or agricultural uses. For greater certainty, a land use description categorized as "all lawful purposes" is not acceptable.
    • 3.2.3. Duration of the Lease – The Locatee Lease states a definite commencement date and termination date including options to renew and extend the Locatee Lease as negotiated by the Locatee and the Lessee.
    • 3.2.4. Rent – The Locatee is solely responsible for the determination of the benefit to be obtained from the leasing transaction for the duration of the Locatee Lease Footnote 4. For additional information refer to Annex A: Checklist for Locatee Leases.
  • 3.3. Standard Form Locatee Lease
    • 3.3.1. The Departmental Official drafts the Locatee Lease using the Department's standard form Locatee Lease which includes mandatory clauses such as insurance requirements, construction standards and environmental protection provisions.
    • 3.3.2. A copy of the standard form Locatee Lease will be made available to the proposed Lessee and the Locatee.

4. Environmental Management

  • 4.1. It is the policy of the Department to avoid the contamination of reserve lands. In processing the Locatee Lease, the Departmental Official will assess whether the use of the lands as proposed in the Application increases the risk of contamination of the land.
    • 4.1.1. Where the Departmental Official determines an increase risk of contamination of the lands, the Lessee will be required to take the appropriate steps to mitigate such risks. Refer to the Directive 7-3: Locatee Leases (see section on Environmental Assessment).

5. Roles and Responsibilities

  • 5.1. Locatee
    • 5.1.1. The Locatee is responsible for submitting a completed, witnessed and signed Application which includes the Release and Indemnity Agreement.
  • 5.2. Lessee
    • 5.2.1. The Lessee will comply with all applicable Laws and standards including health and safety and environmental requirements, building codes, service requirements, and the terms and conditions of the Locatee Lease at all times.
    • 5.2.2. The Lessee is responsible for determining whether the lands are suitable for the proposed use(s) as described in the Application.
    • 5.2.3. The Lessee is responsible for obtaining adequate legal and physical access to the leased land.
  • 5.3. Band Collective Interests – The Indian Act does not specifically provide for the band's consent to Locatee Leases under ss.58(3) Footnote 5. The Department, however, recognizes that the band has an important interest in the use and development of reserve lands, including those lands the band has allotted to its members.
    • 5.3.1. The Band Authority should provide feedback to the Department as to whether the proposed use(s) as described in the Application comply with band's by-laws under s. 81 of the Indian Act or other applicable Laws.
    • 5.3.2. The Band Authority feedback to the proposed use(s) of the lands will be processed in accordance with the Directive 7-3: Locatee Leases (see section on Band Authority's Review and Feedback).
    • 5.3.3. The Band Authority should provide supporting documents when submitting feedback to the Department.
  • 5.4. Departmental Official
    • 5.4.1. The Departmental Official reviews the information provided in the Application, obtains and reviews the Band Authority's feedback and drafts the Locatee Lease in accordance with this Policy and Directive 7-3: Locatee Leases (including the Locatee Lease Checklist provided in Annex A to the Directive).
    • 5.4.2. Upon receipt of an executed Locatee Lease from the Lessee, the Departmental Official arranges for execution by the Lessor and registration of the Locatee Lease in the Indian Lands Registry.

Directive 7-3: Locatee Leases

Purpose

This Directive explains the steps for processing Locatee Leases under ss. 58(1)(b) and ss. 58(3) under the Indian Act in accordance with the Locatee Lease Policy. A detailed Locatee Lease Checklist is provided in Annex A to this Directive. It is important to note that some of the steps outlined below may take place simultaneously.

Process

1. Providing Information on Locatee Leasing

  • 1.1. At the initial contact, the Departmental Official informs the Locatee and the Lessee of the policy and process requirements for processing a Locatee Lease, and makes available the following:
    • 1.1.1. an Application; and,
    • 1.1.2. a standard form Locatee Lease Footnote 6.

2. Application for Leasing Locatee Lands within an Indian Reserve

  • 2.1. The Locatee and the proposed Lessee are required to complete and sign the Application, and submit supporting documents Footnote 7.
    • 2.1.1. The supporting documents submitted will include:
      • 2.1.1.1. a corporate certificate of good standing, if the proposed Lessee is a corporation;
      • 2.1.1.2. an identification document, if the Lessee or Locatee is an individual;
      • 2.1.1.3. a development proposal;
      • 2.1.1.4. appropriate plans or survey of the land; and,
      • 2.1.1.5. any other documents relevant to the proposed Locatee Lease.

3. Verification of the Status of the Land

  • 3.1. The Departmental Official will complete a Lands Status Report.

4. Confirm the Legal Land Description

  • 4.1. The Departmental Official informs the Lessee and Locatee of the need for a proper legal description of the lands to be leased and that any costs associated with the creation of a proper legal land description (including all survey costs) are not the responsibility of the Department.
  • 4.2. The legal description of the lands to be leased is required to be in accordance with the current Framework Agreement between Lands and Trust Services Department of Indian Affairs and Northern Development and Legal Surveys Division, Earth Sciences Sector, Natural Resources Canada or other agreements in place between AANDC and Natural Resources Canada governing surveys.
  • 4.3. The Departmental Official advises the Locatee and the proposed Lessee in writing where the legal land description is inconsistent with the information provided in the Application. The Locatee and the proposed Lessee are required to correct any inconsistency by submitting a new completed and signed Application.
  • 4.4. The proposed Lessee is responsible for ensuring that the proposed use(s) of the lands does not conflict with existing encumbrances, if any.

5. Environmental Management

  • 5.1. Environmental Site Assessment – The Lessee will conduct an Environmental Site Assessment in accordance with Chapter 12 of the Land Management Manual to determine the environmental conditions of the lands prior to the issuance of a Locatee Lease.
  • 5.2. Environmental Assessment
    • 5.2.1. Where there is a proposed physical activity or project being contemplated for the leased lands, the Departmental Official will determine the appropriate level of environmental review required to determine the likelihood of significant adverse environmental effects on the proposed leased lands.
    • 5.2.2. The Lessee is responsible for providing all the required information necessary to determine the appropriate level of environmental review.
    • 5.2.3. The Departmental Official will continue processing the proposed Locatee Lease where effective mitigation measures can be used to avoid significant adverse environmental effects or where justification of significant environmental effects has been provided by the Governor in Council.
  • 5.3. Environmental Audit
    • 5.3.1. The Lessee will perform an environmental audit in accordance with Chapter 12 of the Land Management Manual to evaluate the compliance of the activities and the equipment operating on the site. This should be undertaken once the Locatee Lease has been executed, upon renewal of the Locatee Lease and periodically throughout the duration of the Locatee Lease.
  • 5.4. Reporting
    • 5.4.1. In the event that environmental effects are caused by activities on the leased lands, it is the responsibility of the Lessee and the Locatee to immediately report these issues to the Band Authority, the Department and applicable federal and provincial departments responsible for regulating the environmental effects.

6. Band Authority's Review and Feedback

  • 6.1. The Departmental Official will submit a written notice of a proposed Locatee Lease to the Band Authority requesting review and feedback.
  • 6.2. The written notice of the proposed Locatee Lease will include the following information:
    • 6.2.1. identity of the proposed Lessee and the Locatee;
    • 6.2.2. duration of the proposed Locatee Lease;
    • 6.2.3. description of the proposed land use(s);
    • 6.2.4. legal description of leased lands;
    • 6.2.5. sharing of the rent revenue arrangement with the Band Council, if any; and,
    • 6.2.6. timeline for a written response from the Band Authority.
  • 6.3. The Band Authority will respond by letter or by BCR to the Departmental Official within 45 business days of the date of the request, unless the Band Authority and the Departmental Official agree otherwise.
    • 6.3.1. The response should indicate whether the proposed use(s) in the Locatee Lease complies with the band's by-laws under s. 81 of the Indian Act or other applicable Laws.
    • 6.3.2. The Band Authority should attach supporting documents to its written feedback.
  • 6.4. Where comments have not been received from the Band Authority within the prescribed time in accordance with subsection 6.3 of this Directive or as agreed upon, the Departmental Official will proceed with the processing of the Application to lease the Locatee's lands.
  • 6.5. Where comments are received within the prescribed time, the Band Authority's feedback will be reviewed by the Departmental Official and if necessary, the Departmental Official will request additional documents.
  • 6.6. Where the Departmental Official determines that the proposed use(s) of the lands violates s.81 of the Indian Act or other applicable Laws or raises issues to be addressed by the Locatee or the Lessee, the Departmental Official will advise the Locatee and the Lessee in writing indicating:
    • 6.6.1. the nature of the violation or issue;
    • 6.6.2. that the leasing process is temporarily suspended until the violation or issue stated in section 6.6.1 is addressed to the satisfaction of the Departmental Official;
    • 6.6.3. that a written response must be provided to the Departmental Official within 30 business days of the date of notification or as agreed upon; and,
    • 6.6.4. that failure to provide a written response within the prescribed period or as agreed upon may terminate the Locatee Lease process.

7. Completing and Verifying the Application

  • 7.1. The Departmental Official informs the Locatee and the Lessee of any incomplete sections of the Application.
    • 7.1.1. Where the land has been allotted to more than one Locatee, each Locatee is required to provide a separate signed and witnessed Release and Indemnity Agreement (Part 4 of the Application).
  • 7.2. By checking the appropriate box in the Locatee Lease Checklist, the Departmental Official indicates that they have confirmed that the Application has been properly completed and signed by both the Locatee and the Lessee.
    • 7.2.1. the Checklist also contains specific reminders with regards to completing the leasing transaction.

8. Drafting the Locatee Lease

  • 8.1. The Departmental Official commences drafting the Locatee Lease once the completed and signed Application including all requested information has been received. Refer to Directive 7-4: Negotiating and Drafting Leases for general guidance on drafting Leases.

9. Amendments to the Locatee Lease

  • 9.1. Amendments to the mandatory provisions of the standard form Locatee Lease should be kept to a minimum.
  • 9.2. For amendments prior to the execution of the Locatee Lease, the Departmental Official will obtain the written consent of the Locatee.
  • 9.3. After the execution of the Locatee Lease, any amendments will be in accordance with the terms and conditions of the Locatee Lease.

10. Allocate the Proceeds of the Lease

  • 10.1. Where the Band Council has an approved policy on the division of revenue, any revenues collected are required to be divided according to that policy on revenue division. If the Band Council and the Locatee agree to divide lease revenues, a written agreement signed by the Locatee and the Band Council should be attached as a schedule to the Locatee Lease.

11. Suspension of the Locatee Lease Processing

  • 11.1. Where the Departmental Official's request for information at any stage in the leasing process is not complied with within 30 business days of its request to the Locatee or the proposed Lessee, the Departmental Official will suspend the processing of the Locatee Lease until the requested information is received.

12. Execution of the Locatee Lease

  • 12.1. A minimum of four original executed Locatee Leases are required for registration – one for the Indian Lands Registry, the Lessee(s), the Locatee(s) and the Department.
  • 12.2. The Lessee will send all originally executed copies of the Locatee Lease to the Departmental Official for signature.
  • 12.3. At no time will the Lessee be granted possession of the Locatee's lands until the Locatee Lease is executed by all of the parties.

13. Registration of the Locatee Lease

  • 13.1. The Departmental Official sends the fully executed Lease together with any supporting documentation to the Indian Lands Registry in the appropriate regional center for registration, and upon the completion of registration, distributes the executed originals to the Locatee(s) and the Lessee(s). Refer to the Indian Lands Registration Manual to ensure the Locatee Lease meets all requirements for registration.

14. List of Annexes

  • 14.1. Annex A- Checklist for Locatee Lease
  • 14.2. Annex B- Notification Letter for Band Authority Feedback
  • 14.3. Annex C- Notification Letter for Suspension of Leasing Process

15. References

  • 15.1. Chapter 7 (Leases: Drafting, Issuing and Cancelling) of the Land Management Manual.
  • 15.2. Chapter 8 (Administering Leasing and Permits) of the Land Management Manual.
  • 15.3. Chapter 11 (RLAP and "53/60" Land Management Programs) of the Land Management Manual.
  • 15.4. Chapter 12 of this manual for Environmental considerations of the Land Management Manual.
  • 15.5. Delegation of Authority Instrument under the Indian Act and Related Regulations (refer as well to the relevant regional delegation instrument).
  • 15.6. Indian Lands Registration Manual.
  • 15.7. Pertinent sections of the Indian Act.

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