N.W.T. First Nation asking why it can't access federal housing loan guarantees

The Yellowknives Dene First Nation (YKDFN) is pressuring federal officials to explain why they do not grant loan guarantees that would enable First Nations to directly access federal money to build housing on their own land.

Jason Snaggs, the CEO of the YKDFN, teamed up with Ryerson University researchers to understand why the First Nation has not been able to access ministerial loan guarantees (MLGs) through Indigenous Services Canada.

A ministerial loan guarantee enables First Nations to get direct funding from approved lenders like the Canada Mortgage and Housing Corporation (CMHC) and its $60-million federal housing fund which was designed to tackle the territory's housing crisis.

MLGs were first offered in 1966 to facilitate home building on reserves. The guarantees provide double default loan insurance in which a band council vouches for the builder and the minister guarantees the repayment of the loan in the case of a default. The program was expanded to cover lands outside of reserves where Indigenous communities normally reside.

Territory-wide issue

Leah Cooke, a researcher with Ryerson University's Together Design Lab, says the issue goes beyond YKDFN and they're working to ensure the loans are more readily available for all First Nations across the N.W.T. 

They showed their report findings to the CMHC and Indigenous Services Canada. 

"It's complicated because of multiple federal branches involved. What we've been able to determine so far is that this [ministerial loan guarantee] program hasn't been accessed in the N.W.T. by any First Nation, regardless of tenure. That makes it a lot harder for them to access housing," said Cooke. 

Snaggs said Matt Spence, the regional director general of Crown Indigenous Relations and Northern Affairs Canada, was "more or less prepared to work with YKDFN to make sure we get access to this."

The CBC requested information from the Canadian Mortgage Housing Corporation.

In an email, a spokesperson confirmed that the CMHC met with YKDFN to explore funding options through the National Housing Co-Investment Fund and National Housing Strategy. 

The spokesperson added ministerial loan guarantees are under the jurisdiction of Indigenous Services Canada. CBC requested more information from that agency on Monday but hasn't yet received a response to its questions.

Building without ministerial loans a 'disaster'

The Together Design Lab report states the majority of land tenure in the built areas around the Yellowknives Dene First Nation communities of Dettah and Ndilo appear to meet all the requirements for ministerial loan guarantees and should be granted the ministerial loans.

The land on which the communities are built are defined as federal Crown land and, while managed by the band, is not owned by the band. It is federal land set outside of reserves for First Nations, like the YKDFN, who haven't settled their land claims yet.

The report also highlights that in 2010, a review of the ministerial loan program found that more than half of First Nations respondents felt that "without MLGs, there would be very limited options to obtain housing on reserve" and that it would be a "disaster."

Dettah and Ndilo, which are not on reserve lands, are in this situation, the Together Design Lab report states. 

It goes on to say that the "permission to occupy does not grant any rights or interests to land, creating a barrier for occupants to access financing for housing such as mortgages," because the land cannot be leased, bought or sold.

This makes some forms of security that the CMHC accepts, such as putting up property as collateral, prohibitive or challenging for Northern First Nations, and easier for a larger entity like a housing corporation, said Cooke. 

"As a result, YKDFN has not been able to secure financing or build housing of its own in this time and has been forced into a position of reliance on the Northwest Territories Housing Corporation for the provision of housing programs," the report states.

Yellowknives Dene, without ministerial loan guarantees, now face a decline in the number of new units and a rise in overcrowding, it states.

Caught in cycle of poverty 

The N.W.T. Housing Corporation has created a position to help people navigate the $60-million housing fund.

According to Snaggs, a portion of the houses built on YKDFN land through this housing fund and without a ministerial loan would be added to the territory's housing corporation stock.

Snaggs says the First Nation fundamentally opposes a model where the housing corporation would own a portion of the new housing stock, and rent it out to Yellowknives Dene on their own land.

He said some members are in arrears of up to $30,000 in rent to the N.W.T. Housing Corporation and kept in a cycle of poverty due to low levels of home-ownership. 

"It is against our strategy and the intent of our First Nation," he said.

The First Nation plans to renew existing lots, train and certify members to build, and use rent-to-own models for members. 

Snaggs says YKDFN will continue to meet with federal officials to make sure First Nations like theirs can get the funding they need because existing money is not available to the majority of First Nations in the territory. 

Two years ago, $600 million was allocated by the federal government to the Assembly of First Nations, said Snaggs.

"When you look at that announcement, it's tied to reserves. How many reserves are there in the N.W.T.? Only two. The rest are all modern treaties or unsettled First Nations looking to settle their claims," he said. 

In the meantime, they have started to apply for things like CMHC's $1-billion Rapid Rehousing Initiative, which guarantees 100 per cent funding. 

It will help them realize parts of their strategy, like infilling lots, but he said the terms of the fund need to be changed to be more in line with the North's building season and its circumstances.