Environmental Review Process Proponent's Guide

1.1 Purpose

This document is intended for use by proponents undertaking projects on First Nations reserve lands which are, pursuant to the Impact Assessment Act (IAA), subject to the Indigenous Services Canada (ISC) Environmental Review Process (ERP). It describes the steps associated with the ERP and the respective roles of proponents and ISC regional environment officers. It should be used before an application for a project on reserve lands is submitted to ISC. While this document provides general guidance on the ERP, proponents are encouraged to consult with ISC regional environment officers to discuss the appropriate application procedures and any additional requirements for their particular projects.

1.2 The environmental review process

ISC developed the ERP in 2013 to satisfy its obligations under the Canadian Environmental Assessment Act, 2012, and now under the Impact Assessment Act (IAA) and ensure that projects it supports on reserve lands proceed in an environmentally responsible manner. The IAA is federal environmental legislation that establishes a framework for evaluating the environmental impacts of designated projects and projects on federal lands. Under section 82 of the IAA, federal departments are required to ensure that proposed projects on reserve lands are not likely to result in significant adverse environmental effects before they take action or make a decision that would enable such projects to proceed. Most projects proposed on reserve lands are not designated projects and thus do not trigger a federal impact assessment, but they may be subject to a section 82 determination of environmental effects by the supporting federal department.

The ERP is a project planning tool that enables ISC to carefully consider the environmental effects of proposed projects and the impacts of those effects on Indigenous peoples and on health, social and economic conditions in communities. ISC must make such a determination of environmental effects before it can issue funding, land tenure or other authorizations (Appendix A) in support of projects on reserve lands.

The environmental review focuses on the proposed project components located on reserve lands and the full extent of the potential environmental effects associated with those components. Any environmental effects that originate on reserve lands but cross into an adjacent jurisdiction, such as a municipality, provincial lands or another reserve, must also be considered in the review. In some cases, the environmental effects of a project may trigger the Crown's legal duty to consult. For further information and guidance on fulfilling the duty to consult, see Appendix B).

Through the ERP, mitigation measures and best management practices that may eliminate or reduce the environmental effects of proposed projects can be identified, and follow-up programs may be recommended. The ERP helps ensure that proposed projects comply with all applicable federal and provincial laws, standards and permit requirements. Under the ERP, the level of environmental review is proportionate to the level and likelihood of potential environmental risk associated with execution of the proposed project. As a result, projects that are low in complexity and environmental risk, are routinely undertaken or have feasible, well-established mitigation measures do not require the same level of review as projects that have a greater potential to cause adverse environmental effects. Sections 2.2 and 2.3 of this document describe the process for assessing the risk of proposed projects and determining the appropriate level of review.

The ERP applies primarily to projects on reserve lands south of 60° north latitude and does not apply to projects in areas under land claim agreements as they are not considered to be federal lands as defined in the IAA.

1.3 Indigenous perspectives

The specific worldviews, customs, practices and traditions of Indigenous peoples are integral to the distinctive cultural identity of each First Nation and should be acknowledged and incorporated in every project development decision and throughout implementation and monitoring. ISC acknowledges the importance of Indigenous perspectives throughout the ERP and encourages proponents to engage meaningfully with concerned Indigenous communities, including different groups or subgroups of people within those communities.

2.1 Step 1: Determine if the ERP applies

In Step 1 of the ERP, the proponent must complete sections 1 and 2 of the Project Description Form in order for the project to be considered for the ERP.

2.2 Step 2: Identify level of environmental review

In certain instances, a project that meets the definition and criteria of the classes of projects outlined in the Designated Classes of Projects Order may be exempted from environmental review and from publication on the Canadian Impact Assessment Registry (the registry). The ISC regional environment officer is responsible for making this decision based on information in sections 1 and 2 of the Project Description Form. Proponents may be required to provide additional information.

If it is determined that the ERP applies, the ISC regional environment officer is required to post a Notice of Intent on the registry. The public is encouraged to provide comments regarding that determination.

The legislative requirements for public participation are set out in sections 84 and 86 of the IAA. While ISC may always choose to do more, the IAA requires that ISC,

• before making an environmental effects determination, post on the registry a notice that indicates that it intends to make a determination and that invites comments from the public, s. 86(1) for a period of at least 30 days, s. 86(2)
• consider public comments when making the determination, s. 84(1)(d)
• notify the public of the determination by posting a Notice of Determination on the registry that includes any mitigation measures taken into account in making the determination, s. 86(2). For more information about this requirement, see Step 5: Decision and implementation.

ISC will contact the proponent if more information is required to perform a risk assessment, which may include completing the Project Description Form, sections 3 to 5.

Once the Project Description Form is complete, ISC regional environment officers will review the information provided and perform a risk analysis to identify whether there is a need for further environmental review. The risk assessment will include the following considerations:

• potential for pollution of soil, air, surface or groundwater
• potential for effects on species at risk or migratory birds
• potential for effects on fish or fish habitat
• potential effects on other valued ecosystem components
• potential effects on First Nations or treaty rights
• potential for public concern
• ability of any identified risks to be managed via best practices, standard mitigation measures, or regulatory means
• potential effects on health, economic and social conditions, which includes human health, services and infrastructure, land and resource use, recreation, navigation, community well-being, structure, site, things of historical, archaeological, paleontological or architectural significance, and economic conditions and livelihoods

Using the results of this analysis, ISC regional environment officers will assign a level of review appropriate to the project, based on its potential risk to the environment. Below is a risk analysis table with examples of potential projects that fall under each category. Exceptions may apply.

2.3 Step 3: Analysis of environmental effects

In section 81 of the IAA, environmental effects are defined as "changes to the environment and the impact of these changes on the Indigenous peoples of Canada and on health, social or economic conditions."

For each adverse effect identified in the Project Description Form, mitigation measures should be proposed with the aim of eliminating, reducing or otherwise controlling the adverse effect. Mitigation may take many forms, including revising the project design, adding some feature or changing the location or timing of project work. For a list of common mitigation measures, see Appendix C.

Effects predicted to remain after mitigation measures have been applied are also evaluated for their significance. In determining the significance of adverse environmental effects, ISC may consider:

• whether the project's outcomes are likely to exceed thresholds established under any regional study
• whether the timing of the proposal could result in significant interactions with the environment (for example construction or operation of a project during migratory birds' nesting season)
• whether the environmental effects and mitigation measures of similar projects could be applied to the current project
• the level of public concern
• the potential for cumulative effects
• criteria such as the scale, magnitude, duration, reversibility and ecological context (in other words how the region has already been affected by human activity) of potential effects.

When determining the likelihood of significant adverse effects, the probability that the effects will occur and the level of scientific uncertainty associated with the information and methods used in the environmental review must be considered. For a more comprehensive discussion on how significance and likelihood are determined, see Determining Whether a Project is Likely to Cause Significant Adverse Environmental Effects.

During the review, ISC may need to seek (or require the proponent to seek) the input of other federal departments or agencies, such as the Department of Fisheries and Oceans or Environment and Climate Change Canada, regarding potential effects, mitigation, best practices, and applicable regulatory authorizations. While the IAA does not set out specific timelines for such input, departments and agencies are encouraged to work cooperatively and respond to requests for information and expertise in a timely manner.

2.4 Step 4: Consideration of factors

ISC's determination regarding whether the project is likely to cause significant adverse environmental effects must be based on the following factors specified in section 84(1) of the IAA:

1. Indigenous rights
2. Indigenous knowledge
3. Community knowledge
4. Public comments
5. Mitigation measures

ISC regional environment officers use the information provided in the Project Description Form or Detailed Environmental Review Report when considering these factors in their analysis. Should further information be required, the ISC regional environment officer will reach out to the proponent directly.

2.5 Step 5: Decision and implementation

The ERP concludes when ISC issues a determination regarding the likelihood of significant adverse environmental effects, as required by the IAA (s. 82).

If the environmental review determines that carrying out a project is likely to cause significant adverse environmental effects, ISC cannot provide support (such as, funding or regulatory authorization) to the project. It may, in consultation with the proponent, seek a Governor in Council decision on whether the significant adverse environmental effects are justified in the circumstances s. 82(b) of the IAA. If the Governor in Council determines that the significant adverse environmental effects are indeed justified, ISC would then be able provide support to the project.

If the environmental review concludes that the project is unlikely to cause significant adverse effects, ISC may proceed with its funding and regulatory authorization, such as a permit or lease, in support of the project, as long as all other applicable program requirements are met. As a condition of funding or regulatory approval, ISC will issue terms and conditions or delivery requirements to ensure the proponent will meet IAA requirements, including mitigation measures, during project implementation (Appendix C).

4.1 Submitting a Project Description Form

The ERP should commence early in the planning stages of the project, once the details of the project are known. That being said, the timing and process for submitting a Project Description Form to meet a program's application requirements will vary with the specific ISC program and region. Proponents are strongly encouraged to contact program officers or advisors in the early stages of project planning and obtain program-specific advice on how the ERP fits into the program's review and approval process.

4.2 Environmental review costs

In ISC programs that fund design or business development costs, the environmental review may be considered part of those overall development and design costs. For projects where ISC's only involvement is to provide Indian Act land tenure or Dominion Water Power Act authorizations, the proponent of the project is responsible for funding the environmental review.

4.3 Feasibility study, capital planning study, waste management plan, and business plan

A study funded by ISC that is not a physical activity in relation to a physical work is not considered a project as defined in the IAA, so the ERP does not apply (see the definition of a project). Nevertheless, the ISC Regional Environment Officer should be contacted for advice on any study or plan relating to a planned project on federal lands. Early identification of regulatory requirements or potential environmental issues at the planning stage may save time or costs later on.

4.4 ERP for projects sited both on and off reserve

Section 82 requirements only apply on federal lands, so only the on-reserve portion of the project would be subject to the ERP. Take the example of the proposed construction of a winter road joining 2 or more communities. The on-reserve portion(s) would be subject to the ERP in accordance with section 82 of the IAA. For the off-reserve portion, the review process required will be based on jurisdictional requirements such as provincial and territorial environmental assessment approvals and permits, project specifics and regional requirements. In these cases, ISC may consider using the provincial process to meet its requirements for a determination of environmental effects, in keeping with the 1 project, 1 review principle. Regardless, the proponent must demonstrate that it has met all applicable requirements before it receives ISC funding approval.

4.5 When another federal department is funding an on-reserve project

For some projects on federal lands or outside Canada, more than one authority may have responsibilities under sections 82 and 83.

The Federal Coordination Regulations made under the Canadian Environmental Assessment Act of 1992, which required authorities to work together to ensure a coordinated approach to decision-making, are no longer in force. However, where multiple authorities are required to make a determination of significance on the same project, they are encouraged to work together in completing their analysis or producing a single report. It is up to each group of authorities working together to determine the approach they will take and how they would likely collaborate in their consultation approach. This best practice ensures that the public is provided with a single window to the assessment of a given project, regardless of how many authorities are required to make determinations.

While authorities are encouraged to work together in such cases, each authority must ensure that it meet its obligations under sections 81 to 91 of the IAA. This means that, even when working with others, each authority must meet the following requirements:

• Posting public notices (for example, the Notice of Intent and the Notice of Determination) on the Registry and ensuring that the minimum 30-day period between the notices is met
• Completing a determination of adverse environmental effects, based on a consideration of all factors set out in section 84

4.6 Projects on lands managed by First Nations under the First Nations Land Management Act and the ERP

Under the Framework Agreement on First Nation Land Management and the First Nations Land Management Act (FNLMA), the responsibility for authorizing leases, permits, or other land instruments in support of a project is transferred to the First Nation, and hence the First Nation has jurisdiction over environmental assessments on its land. Where a First Nation operates under the FNLMA with its own environmental assessment process and an ISC authorization is required, ISC will work with the First Nation to minimize duplication and follow the "1 project, 1 review" principle.

If the First Nation and the federal authority agree on a harmonized approach to the project's assessment, the federal authority will post the Notice of Intent on the registry. The federal authority will also follow the First Nation's processes for receiving comments from the community. The results of the environmental assessment should be shared between the First Nation and the federal authority to ensure that both parties have sufficient evidence to make their independent determinations. Once the federal authority makes its determination, it will post the Notice of Determination on the registry.

If an agreement cannot be reached on a way to harmonize the First Nation's process with the federal authority's requirements for an environmental assessment, the federal authority may have to conduct an environmental assessment separate from the First Nation's assessment, which will mean 2 assessment for the project. However, the federal authority will still have to work with the First Nations to address section 84 considerations such as Indigenous and community knowledge.

The parties should work together to resolve any disagreement in findings, however, the decision made by the First Nations on whether or not the project will move forward, must be respected.

Proponents should contact the appropriate First Nations for information about its environmental assessment requirements.

4.7 When seeking funding or statutory approval for a project that is already wholly or partially constructed

Occasionally, projects are initiated before or during the ERP. The fact that physical work has already begun on a project does not alter ISC's obligation to ensure that an environmental review is completed, and a determination of environmental effects made, before it provides statutory authorizations or financial assistance.

Proponents should consider the following risks before undertaking a project for which an environmental review has not been completed:

• delay in funding release until environmental issues are properly addressed
• additional costs to rework the project design
• potential for environmental damage
• potential violations of the Canadian Environmental Protection Act, the Species at Risk Act, the Fisheries Act or other legislation

Appendix A: Reasons for an ISC environmental review

The list of reasons below should not be considered exhaustive, and the proponent should confirm with ISC whether the department considers that the ERP has been started for a specific project.

List of ISC reasons for a determination under section 82 of the IAA:

1. ISC is the project proponent
2. ISC is providing financial assistance to the project:
   • Funding from ISC programs (community infrastructure, housing, economic development), with the exception of block funding
3. ISC is issuing a statutory authorization in support of the project:
   • Ministerial expenditure decisions to release band moneys (Indian Act, ss. 64, 66 and 69)
   • Authorization for use of First Nations lands for the purpose of Indian schools, administration of Indian affairs, Indian burial grounds or Indian health projects (Indian Act, s. 18(2))
   • Issuance of a Certificate of Possession for the purpose of enabling a First Nation member to construct a dwelling or other building (Indian Act, s. 20)
   • Issuance of a permit for occupation or use of First Nations land (Indian Act, s. 28(2))
   • Sale or lease of surrendered or designated lands (Indian Act, s. 53(1))
   • Lease to a third party of land allotted to a band member (Indian Act, s. 58(3))
   • Disposal of sand, gravel, clay or other non-metallic substances or the taking of these materials, on or under First Nations lands (Indian Act, s. 58(4)(b))
   • Issuance of a permit or lease for the exploration or development of minerals (Indian Mining Regulations, ss. 5(2), 6(1))
   • Issuance of a permit to operate a garbage dump, dispose of or store waste, or burn waste on First Nations lands (Indian Reserve Waste Disposal Regulations, s. 5)
   • Issuance of a permit to First Nations members to cut timber for sale, Indian Timber Regulations, s. 5(1)
   • Issuance of a licence for cutting and removing timber from First Nations lands (Indian Timber Regulations, s. 9) or varying the terms of a timber licence (s. 22(1))
   • Issuance of surface leases and rights-of-way (Indian Oil and Gas Regulations, s. 73(3)) or exploratory work on First Nations lands that requires an exploratory licence (Indian Oil and Gas Regulations, s. 29(1))
   • Oil and gas exploration on First Nations lands that requires a right of entry (Indian Oil and Gas Regulations, s. 30)
   • Issuance of a lease to commence production of crude bitumen (Indian Oil and Gas Regulations, 1995, s. 39(1))
   • Amendment of a lease or permit to provide for production of crude bitumen (Indian Oil and Gas Regulations, 1995, s. 39(3))
   • Taking of lands by local authorities (Indian Act, s. 35(1))
   • Acceptance of an absolute surrender or designation (Indian Act, s. 39(1)(c))
   • Authorization from the Minister to enter on, use, occupy, take and acquire any lands that may be required for a hydroelectric project. (Dominion Water Power Act, s. 7(1))
   • Authorization from the Governor in Council necessary to bring about the joint development and operation of a hydroelectric project, where such is economically desirable (Dominion Water Power Act, s. 9)
   • Licences, authorizations and approvals under sections 8(1), 12(2), 21, 25(2), 40(1), 46, 49(3), 50 or 69(3) of the Dominion Water Power Regulations
   • Issuance of a Ministerial Loan Guarantee (Indian Act (s. 89(1)), which protects First Nations property from seizure by a non-Indian (for example, lender)

Appendix B: Regulatory agencies, legislation, and guidelines

The following table lists regulatory agencies, legislation and guidelines that may be involved in a project on First Nations reserve land. The list is a working aid and is not exhaustive. The proponent is responsible for ensuring that the project incorporates the most current references and complies with all legislative requirements.

Appendix C: Mitigation measures

Appendix D: Glossary

Unless otherwise noted, all definitions are taken verbatim or in modified form from the Impact Assessment Act.

Agency

Impact Assessment Agency of Canada

Aquatic species

Wildlife species that are fish, which includes all or any parts of fish, shellfish, crustaceans, marine animals or the eggs, sperm, spawn, larvae, spat and juvenile states of fish, shellfish, crustaceans and marine animals; or a marine plant, which includes all benthic and detached algae, marine flowering plants, brown algae, red algae, green algae and phytoplankton (Fisheries Act)

Band-owned fee-simple land

Off-reserve land which is owned by the band for the purposes of economic development funding

Baseline studies

Work done to collect, analyze and interpret information on the status or trends of the environment likely to be affected by a development action, prior to the beginning of the project. A benchmark for measuring changes caused by the project

Canadian Environmental Protection Act (CEPA)

An Act respecting pollution prevention and the protection of the environment and human health in order to contribute to sustainable development

Cumulative effects

A change in the environment caused by multiple interactions among human activities (for example, projects) and natural processes that accumulate across space and time

Decommissioning

The restoration work required to minimize the ongoing adverse environmental effects associated with a project, or component of a project, that is no longer required

Designated project

Categories of projects with a large potential to result in significant adverse environmental effects within federal jurisdiction (described in the Physical Activities Regulations)
Designated projects are physical activities that

• are carried out in Canada or on federal lands
• are designated by regulations made under paragraph 109(b) or designated in an order made by the Minister under subsection 9(1)

They include any physical activity that is incidental to those physical activities but not a physical activity designated by regulations made under paragraph 112(1)(a.2).

Ecosystem

A community of interdependent plants and animals together with the environment which they inhabit and with which they interact

Environment

The components of the earth, including:

• land, water and air, including all layers of the atmosphere
• all organic and inorganic matter and living organisms
• the interacting natural systems that include components referred to in first 2 paragraphs

Environmental review

An analysis of the environmental effects of any ISC-supported project proposed on federal lands, conducted in accordance with section 82 of the Impact Assessment Act

Environmental effects

Unless the context requires otherwise, changes to the environment or to health, social or economic conditions and the positive and negative consequences of these changes

Federal authority

• A Minister of the Crown in right of Canada
• An agency of the Government of Canada or a parent Crown corporation, as defined in subsection 83(1) of the Financial Administration Act, or any other body established by or under an Act of Parliament that is ultimately accountable through a Minister of the Crown in right of Canada to Parliament for the conduct of its affairs
• Any department or departmental corporation that is set out in Schedule I, I.1 or II to the Financial Administration Act
• Any other body that is set out in Schedule 1 of the Impact Assessment Act

Federal lands

• Lands that belong to Her Majesty in right of Canada, or that Her Majesty in right of Canada has the power to dispose of, and all waters on and airspace above those lands, other than lands under the administration and control of the Commissioner of Yukon, the Northwest Territories or Nunavut
• The following lands and areas:
  • the internal waters of Canada, in any area of the sea not within a province
  • the territorial sea of Canada, in any area of the sea not within a province
  • the exclusive economic zone of Canada
  • the continental shelf of Canada
• Reserves, surrendered lands and any other lands that are set apart for the use and benefit of a band and that are subject to the Indian Act, and all waters on and airspace above those reserves or lands

Follow-up program

A program for

• verifying the accuracy of the environmental assessment of a designated project
• determining the effectiveness of any mitigation measures

Habitat

All the elements of earth that are used by wildlife species to sustain themselves throughout their life cycles. This includes the spaces (for example, terrestrial and aquatic) that they require as well as the properties of those spaces (for example, biota, climate, soils, ecological processes and relationships). Habitats function in providing such needs as food, shelter and a home place. Habitats can be thought of as distinctive places or ecosystems, such as prairie habitats or Arctic habitats, Environmental assessment best practice guide for wildlife at risk in Canada (Environment Canada).

Impact Assessment Act:

An Act respecting a federal process for impact assessments and the prevention of significant adverse environmental effects replaces the Canadian Environmental Assessment Act, 2012.

Impact assessment (IA)

An assessment of the effects of a designated project that is conducted in accordance with the Impact Assessment Act. IA is a process for identifying project-environment interactions, predicting environmental effects, identifying mitigation measures, evaluating significance, reporting and following up to verify accuracy and effectiveness. IA is a planning tool to help guide decision-making and project design and implementation.

Mitigation measures

Measures to eliminate, reduce, control or offset the adverse effects of a project or designated project, including restitution for any damage caused by those effects through replacement, restoration, compensation or any other means.

Monitoring

Systematic observation and/or collection of data and evaluation of environmental/socio-economic parameters or processes.

Physical activity

Any proposed construction, operation, modification, decommissioning, abandonment, or other undertaking in relation to a physical work.

Physical work

A structure built by humans that has a defined area and fixed locality (for example, it has a permanent location).

Project

A physical activity that is carried out on federal lands or outside Canada in relation to a physical work and is not a designated project, sometimes informally referred to as a non- designated project.

Proponent

The person or entity that proposes the carrying out of a non-designated project or a designated project.

Remediation

Removal, treatment, destruction or containment of soils, sediments, wastes, groundwater or surface waters contaminated by hazardous substances.

Residual effects

Predicted adverse environment effects that remain after mitigation measures have been applied.

Species

Any indigenous species, subspecies, variety or geographically or genetically distinct population of wild fauna or flora, Environmental assessment best practice guide for wildlife at risk in Canada.

Reserve

• A tract of land, the legal title to which is vested in Her Majesty, that has been set apart by Her Majesty for the use and benefit of a band
• Except in subsection 18(2), sections 20 to 25, 28, 37, 38, 42, 44, 46, 48 to 51 and 58 to 60 and the regulations made under any of those provisions, includes designated lands, Indian Act

Valued ecosystem component

The environmental element of an ecosystem that is identified as having scientific, social, cultural, economic, historical, archaeological or aesthetic importance. The value of an ecosystem component may be determined on the basis of cultural ideals or scientific concern. Valued ecosystem components that have the potential to interact with project components should be included in the assessment of environmental effects.