Capital Assets Guide Chapter 1: First Nations Child and Family Services

Principles for capital related to First Nations Child and Family Services

In addition to the overarching principles outlined in the Overview section of this Guide, when assessing the eligibility of capital funding requests related to the FNCFS Program, ISC takes into consideration the following items, none of which is, by itself, determinative of the request:

• capital assets support the delivery of FNCFS funded services and activities to First Nations children, youth and families on reserve and in the Yukon;
• where appropriate, First Nations and associated FNCFS agencies jointly planned and identified the capital project as being in alignment with community FNCFS needs to support the delivery of services and activities;
• First Nations or FNCFS agencies demonstrate how they envision the asset fitting within their existing long-term FNCFS-related plans and objectives for the delivery of services and activities through the program funding;
• the documentation demonstrates value for money, taking into consideration the community's circumstances, including the geographical location of the capital project; and
• construction or purchase of off reserve property is eligible where there is no suitable property available on reserve for construction, or where off reserve construction is more accessible for First Nations children, youth and families on reserve and in Yukon to receive services.

3.1 Eligible funding requestors

• FNCFS agencies, societies or other provincially/Yukon delegated child and family service providers
• First Nations^{Footnote 1} on reserve or in the Yukon that are recognized as Bands within the meaning of the Indian Act
• First Nations^{Footnote 1} that have concluded a self-government agreement, but have not exercised child and family services jurisdiction

3.2 Ineligible funding requestors

First Nations who have entered into a coordination agreement under the framework provided in An Act respecting First Nations, Inuit and Métis children, youth and families are not eligible for capital funding through this process. For such First Nations, funding will be provided through the grant mechanisms established under the Act. However, as per the agreement-in-principle for the long-term reform of the FNCFS Program, these First Nations will not receive less funding than they would have received under the reformed approach for the FNCFS Program.

3.3 Eligible activities

To be eligible, a capital asset must support the delivery of services or activities for at least one of the following funding streams outlined in the FNCFS Program's Terms and Conditions:

• FNCFS - Prevention: Services delivered by First Nations or delegated agencies that support the safety and well-being of First Nations children, youth, young adults and families, in an approach that is culturally appropriate, in the best interests of the child and provided on the basis of substantive equality. The goal of prevention services is to reduce the likelihood of child maltreatment, including by addressing the structural drivers and underlying root causes of the over-representation of First Nations children and families in the child welfare system, such as poor housing, poverty, racism and intergenerational trauma manifested as substance misuse and intimate partner violence, through a service approach that recognizes historical and contemporary disadvantage, and contextual and cultural differences of First Nations Peoples.
• FNCFS - Protection and Guardianship: Services delivered by provincially delegated service providers that respond to child maltreatment, provide guardianship and/or custody services including alternative care, and support family preservation, reunification, and well-being, including cultural and linguistic connections, for First Nations children, youth and families.
• FNCFS - First Nation Representative Services: Services delivered by First Nations or First Nation authorized service providers that represent the collective interest of the First Nation as well as its families and children whenever a society, agency, person, or entity may be involved in a First Nation family's lives because of child welfare or child protection concerns. For more information on First Nation Representative Services please visit the ISC webpage: First Nation Representative Services information.
• FNCFS – Post-Majority Support Services: Post-majority support services are services for First Nations youth aging out of care and young adults who were formerly in care, up to and including the age of 25, or consistent with the age as defined in provincial or territorial legislation, whichever is greater. For more information on post-majority support services please visit the ISC webpage: Post-majority support services for First Nations youth and young adults.

3.4 Eligible assets

Capital assets are pieces of property, buildings, spaces, or vehicles that are intended for long-term use. Eligible assets that support the delivery of services or activities listed in Section 3.3 include:

• Assets that are fit for purpose, meaning that they support the delivery of eligible activities or services funded under the FNCFS Program, for instance by providing a safe, accessible, adequate, confidential, or culturally appropriate and age-appropriate location, space, or area to provide or support such services.
• Vehicles where not already eligible through the existing claims on actual process as per 2018 CHRT 4 (refer to Sections 3.7 and 3.8 for further clarity).
• Housing for personnel delivering FNCFS in First Nations where there are no available accommodations and this creates a challenge in attracting and retaining qualified staff. Consideration of whether suitable accommodations are available within a reasonable distance of the community (i.e., short-term or long-term accommodations) should also reflect the nature, scope and duration of the personnel's responsibilities in service delivery.

3.5 Eligible project costs (up to completion of construction)

• capital needs assessments
• capital feasibility studies
• environmental assessments or reviews
• land assessments
• design costs
• land purchase
• purchase, new construction, renovation and replacement of assets
• operation costs for the duration of the project
• insurance for assets
• initial furniture, information technology and other equipment fit for purpose to furnish new spaces
• site preparation, lot servicing and site clean-up after construction
• construction of services from the building to the property line, including connection to the main distribution systems for water, sewer, electrification, gas and solar power at the edge of the property
• upgrades to site access enabling access to the building or other assets such as structures to support land-based learning and programming
• up to 15% of the total capital project cost for administration costs related to: the development of a capital funding request, project management/coordination, travel and other project implementation and oversight activities
• professional fees (e.g., technical personnel, legal fees for contract and tender review, bookkeeping/audit fees, architects, consultants, and contractors to design, develop, complete, or monitor the project, and engineering, manufacturing or building of capital project facilities and structures)
• municipal taxes for buildings and land located off reserve
• financing costs incurred by funding recipients who took out loans to move forward with their capital project (only eligible for capital projects that were underway as of August 26, 2021).

3.6 Eligible operations and maintenance costs (ongoing operations once construction is complete)

The preservation of the functional integrity of FNCFS-funded assets is a priority. All assets should be:

• maintained to achieve their full design life, including regular inspections, preventative maintenance, and repairs when required; and
• operated to ensure their proper day-to-day functioning and service delivery outcomes as intended, with due regard to health and safety of the community and the environment.

Ongoing Operations andand Maintenance costs can be funded on an annual basis through claims under 2021 CHRT 41, until the full needs for Operations and Maintenance related to FNCFS capital assets are known. For requestors who already receive Operations and Maintenance funds through other sources such as FNCFS Operations or claims under 2018 CHRT 4, claims will need to account for the use of these funds when seeking incremental funding through 2021 CHRT 41. All Operations and Maintenance costs identified in the list below of eligible expenditures should be in alignment with the operation and maintenance of FNCFS assets, to ensure a life-cycle approach (addressed below) and preserve the longevity of the asset.

ISC promotes a life cycle approach for assets starting with the use of a full life cycle costing when approving capital projects. This type of analysis allows for the consideration of all the associated costs of the proposed asset throughout its entire life cycle. For example, for buildings, life cycle costs include design, construction, operation and maintenance, major renovations, and disposal (i.e., decommissioning, repurposing, or demolition).

If applicable, and in collaboration with the First Nation as part of their infrastructure management process, once an asset is built it can be recorded in ISC's capital infrastructure database. The data from the system can be used to generate forms used for asset inspections. The inspections identify asset deficiencies, and support the forecasting of future capital needs. This process allows for preventive or anticipatory work to be completed to ensure the existing infrastructure remains available for its full life cycle to deliver services.

3.7 Ineligible costs

• Taxes for which the funding recipient is eligible for a tax rebate and all other costs eligible for rebates (e.g., Goods and Services [GST] Tax rebates or eco-retrofits to reduce greenhouse gas emissions which may be eligible under other federal funding) are not eligible.
• Expenditures reimbursed by any other source of funding (e.g., Other Government of Canada Departments, Provincial or Territorial Governments) are not eligible.
• Costs related to communications, (phone, internet, television) are driven by program usage, are eligible under each program stream of the FNCFS program, and are not eligible capital funding requests.
• Costs related to fuel to operate vehicles are driven by program usage are eligible under each stream of the FNCFS program, and are not eligible capital funding requests.
• Expansion of core community infrastructure (main distribution systems) such as roads, electrical distribution, water and wastewater mains/systems are not eligible.

i. Capital Funding Request Form

Each of the capital project life cycle phases requires the requestor to submit a Capital Funding Request Form to access capital funding. The link for the request form can be found in Annex B.

A Capital Funding Request Form must be submitted to ISC's FNCFS team at chrt41-tcdp41@sac-isc.gc.ca.

The form compiles information about the funding requestor, the type of services that the capital request supports, how the request aligns with program outcomes, the type of capital project, the phase the project is at, estimated costs, estimated start and end dates, and supporting documentation.

ii. Standards for the processing of capital requests

Upon receipt of a capital funding request submission, the 30-business day clock will start and the FNCFS team will quickly review it to confirm if all of the fields of the form were completed and if the documentation referenced by the funding requestor is included. Within 2 business days of receiving the capital funding submission, the FNCFS team will send a 'Confirmation of Receipt' message in writing to the funding requestor.

If there is any missing information identified at the initial quick review of the request, the FNCFS team will notify the requestor of the missing information (i.e., the email to be sent within 2 days of receipt of submission). The 30-business day clock will pause once the message about missing information has been sent to the requestor and will resume running upon receipt of the missing information.

If the FNCFS team confirms through that initial quick review that the Capital Funding Request form is complete and that the documentation referenced has been provided, they will send an email to the requestor confirming that the initial completeness requirements were met and that the submission will next be reviewed to confirm whether the submission contains enough information to determine eligibility and the costs align with FNCFS objectives. This email will include contact information that the requestor can use if they have questions in the future about the status of their project in the assessment process. Should additional information be required from the requestor at this point, the FNCFS team will send the requestor a detailed list of the outstanding information in writing as well as inform that the Capital team may be engaged to determine the project's readiness to proceed.

If the project does not require a specialized review by the Capital team and eligibility has been confirmed, the FNCFS team will notify the requestor of a full or partial funding decision and of the next steps required to enter into either a new funding agreement or whether to amend an existing funding agreement to flow funding.

If the FNCFS team determines that the project is eligible and that the Capital team needs to be engaged due to the scope and complexity of the project, the FNCFS team and the requestor will work with the Capital team to confirm what additional documentation or phases (if any) may need to be completed before the project is "ready to proceed" to the purchase or construction of an asset. Once these details have been confirmed, the FNCFS team will communicate this information in writing.

If, after the engagement with the Capital team, it is confirmed that no additional documentation or phases are needed and that the project is "ready to proceed", the FNCFS team will render a full funding decision.

If, after engagement with the Capital team, the FNCFS team determines that the project meets FNCFS program objectives but additional documentation or phases are needed before a full funding decision can be rendered, the FNCFS and Capital teams will work with the funding requestor to determine the funding required to complete this work and the FNCFS team will render a funding decision at the current project phase to support the ongoing advancement of the project by funding the completion of this work. For additional information on project phases which may be needed, please refer to section 5.3 Project Lifecyle Process and Scenarios.

5.1 Funding determination

For projects that are deemed "ready to proceed" to the purchase or construction of an asset or for funding requests for feasibility studies, the FNCFS team must make a determination on the funding of a project or study for the current project phase within 30 business days of receiving a capital funding request submission (i.e., Capital Funding Request form and any supporting documentation). ISC may not need the full 30-business days to reach each funding decision – it will vary based on the circumstances and complexity of each project.

The complexity of a project depends on a variety of factors including but not limited to:

• the type of project;
• the overall anticipated cost of the project;
• project completion time;
• whether it is a joint project with other First Nations or agencies or other partners;
• whether it is a multi-purpose building intended to offer multiple types of services;
• the location of the capital asset;
• whether there are health and safety implications;
• whether the property is connected to a road, water and wastewater system, and source of power; and
• whether there are any environmental impacts.

If ISC is not able to make a full funding decision because the project is not "ready to proceed", where possible, in consultation with the requestor, ISC will make a funding decision at the current phase to enable the advancement of the project. ISC will provide funding to support pre-capital and design as the project moves through the project life-cycle to construction completion or purchase of the required asset.

If the 30-business day standard for a funding decision cannot be met due to the level of project complexity or exceptional circumstances, the FNCFS team will notify the requestor in writing and will provide the rationale for the needed additional time.

5.2 Differences in assessment process: Straightforward versus complex projects

The capital funding request and assessment process has been designed to be adaptable to the various types of requests that will come forward, their varying degrees of complexity and different phases of project readiness in the capital project life cycle.

Straightforward funding requests (e.g., a vehicle purchase or replacement of windows) will be assessed and processed through existing internal mechanisms and will not be subject to the Capital Assessment Process described in this chapter.

More complicated projects, for example, those involving the construction of a new building, will need to complete all phases of the capital project life cycle outlined below in Section 5.3.

5.3 Project lifecyle process and scenarios

5.4 Impact of remoteness or other exceptional circumstances on funding request process

Review of capital projects for FNCFS agencies or First Nations situated in remote areas or with exceptional circumstances (e.g., time-limited availability of an ice road, First Nations located in rural areas or areas that were significantly impacted by recent flooding) will consider that some aspects of a project may need to be approved before full feasibility or design work is completed due to factors including but not limited to seasonal access to the First Nation, or the limited availability of contractors.