A Municipal Perspective

There are many challenges that come along with providing services to communities. While each community is unique, there are some challenges that are shared across First Nations in the province and even the country. In delivering services, First Nation governments use and share different types of resources that help them accomplish community goals. You may use resources from Indigenous Services Canada (ISC) to prepare your Comprehensive Community Plan, or the resources on this website to prepare your MTSA.

Like many First Nation governments in BC, you may work with your municipal neighbours to deliver services or for other goals, such as economic development. Your partner municipalities also use different types of support and resources to do their work. This blog post provides a quick overview of three organizations that advocate for and support municipalities in their work: Union of BC Municipalities (UBCM), Federation of Canadian Municipalities (FCM), and CivicInfo BC. These organizations provide forums for municipalities to discuss governance and service delivery challenges and solutions. They also provide resources to help municipalities accomplish their goals.

UBCM

UBCM is the voice of municipalities in BC. This organization advocates on behalf of municipalities to the Province, administers senior government funding for different projects, and provides research on challenges facing municipalities.

UBCM spearheads the Community to Community (C2C) Forum, an annual program bringing together First Nations and local governments from across BC. Through the C2C Forum, partners can discuss actions that they can take together on common goals. In addition to the C2C Forum, UBCM offers other opportunities to its member to support the goals of reconciliation. These include Reconciliation Dialogue Workshops and Indigenous Cultural Safety Training. More information can be found here.

FCM

FCM advocates for municipalities at the national scale. It also administers funding for a variety of municipal projects, such as asset management, sustainability planning, and action on climate change. FCM offers resources to support municipalities in their work, such as research, guidebooks, and webinars.

FCM also offers funding for partnerships between First Nations and municipalities on infrastructure and economic development.

CivicInfo BC

CivicInfo BC is an information hub for BC local governments to find out about news, events and training opportunities, bids and tenders, and resources. It also provides a directory of government contacts, including First Nations, municipalities, and regional districts.

If you and your municipal neighbour have a shared goal and need resources or funding support, it is helpful to look to the different organizations that support both First Nations and municipalities.

A Memorandum of Understanding to Get You Started

In a previous post, we talked about the importance of the Communication Clause in your MTSA. It helps make sure you and your service partners are communicating regularly during the life of your MTSA. However, in some cases, you may need a communications protocol before you get started on your MTSA. This is where a Memorandum of Understanding (MOU) can be useful.

What is an MOU?

An MOU lays out how you and your service partner will communicate while you are in the process of developing an MTSA. An MOU doesn’t have to be long or complicated. It can be a simple, one-page document. The most important thing is that it outlines how you and your service partner want to work together to develop your MTSA or accomplish some other MTSA-related goal.

Do we need an MOU?

It may be good for you and your service partner to have an MOU if any of the following apply to your situation:

  • You are starting a new MTSA with a service partner you’ve never worked with before.
  • You are starting a major update to an MTSA.
  • You are negotiating a capital contribution from Indigenous Services Canada (ISC).
  • You and your service partner are planning a major upgrade to infrastructure.
  • You and your service partner have a history of poor communication or misunderstanding.
  • Either you or your service partner has recently had major staff turnover and the working relationship between representatives is new.

What should we include in our MOU?

Parties Involved

  • Who is the point person at each organization who will be driving the project to completion?
  • Are there other parties involved? For example, representatives from the Government of Canada or consultants.
  • When should lawyers get involved?

Communication

  • What are our general principles for working together? For example, mutual respect, transparency, good will, seeking to understand, etc.
  • When and how often are we going to communication or meet?
  • How are we going to share information with each other?

Plan for Developing the MTSA

  • How are we managing the pre-work? For example, how are we providing information for a study needed to develop an MTSA? How are we sharing work or studies that are completed by consultants hired by one party?
  • When do we need to share information at the political level? What information needs to be shared with our Chief and Council and their Mayor and Council?
  • What is the timeline for negotiating the MTSA?
  • What resources are we using to develop our MTSA? For example, are we using a template or guide?

Taking the time to prepare an MOU before you get started can help you make sure that the process starts on the right foot and that both parties are on the same page.

Ins and Outs of Legal Review

MTSAs are legal documents. A lawyer is very helpful in the MTSA process. Their role is to ensure that what is in the MTSA is legally sound—meaning that it is consistent and clearly lays out the roles and responsibilities of each service partner, and the specifics of the service to be received.

It is important to get a lawyer involved at the right time. Too early and you may spend time and resources spinning your wheels on legal details when you haven’t even set policy directions with your service partner. Too late and you may find problems with your MTSA after everyone has already agreed to the terms.

This blog post will explore a couple of scenarios to help shed some light on when to involve a lawyer.

Scenario 1

Your MTSA has been in place for a long time and you have a great relationship with your service partner. The groundwork was done a long time ago. You’re happy with your agreement, but it’s time to renew it. You and your service partner only want minor changes—for example, changes to the meeting schedule, or an update to rates that everyone agrees upon.

In this case, bringing a lawyer into the process earlier may be a good idea. A lawyer’s job will be to go through the final wording with a fine-toothed comb before both parties sign the document. They are doing a final check and updating any provisions if legal best practice has changed.

Scenario 2

You have a lot of ground work to do. Maybe one of the following applies to your situation:

  • Starting a new MTSA
  • Making major changes to an existing MTSA
  • Planning large capital investments
  • Changing how the service is provided
  • Changing the service itself

Pathways Guide

Pathways to Service Delivery Guide

If one of these applies to your situation, there are a lot of questions that need to be answered before you involve a lawyer. A lawyer’s role is not usually to get into deeper policy questions, or to help with setting a vision. These types of activities happen before a lawyer is consulted. If you get a lawyer involved too early, you may spend a lot of time (and money) negotiating the details when the broader goals have not even been set.

We recommend figuring out those important service delivery questions first by working with your service partner. The resources on this website were created to help you navigate the world of MTSAs. The Pathways to Service Delivery Guide is a great place to start.

Once you have a broad idea of the MTSA process (after reading the guide), you can use the MTSA Handbooks and Checklists to answer the major service delivery questions that you and your service partner need to agree on. It may be helpful to complete a checklist based on your community needs before meeting with your service partner so that you know what your goals are.

Once you’ve agreed on the components of your MTSA, a lawyer can help you draft your MTSA. They will also take care of the standard details such as the following:

  • Schedules
  • Assignment
  • Acknowledgement of Rights
  • Headings
  • Liability and Insurance
  • Governing Laws
  • Indemnity

Developing a Communication Clause

A strong MTSA has a solid communications clause. But, what does this look like? What are the benefits? What are the potential pitfalls? This blog post will help answer these questions.

What is a communication clause and why do you need one?

A communication clause states how the parties of the MTSA will formally communicate with one another over the lifetime of the agreement. It is important to have a communications clause because it means you are proactively planning to meet with your service partner. Regular communication between you and your MTSA partner helps you fulfill your MTSA in a number of ways:

  • Stay up to date on service delivery
  • Discuss and resolve issues early, before they become problems
  • Share information, especially if there are staff changes
  • Build rapport and establish trust

What does a communication clause look like?

Over the lifetime of an MTSA, service partners will have a number of reasons to contact each other: for example, to review their MTSA, to bill for services, to pay for services, and to access information about service provision. A communication clause sets out in one place the following key pieces of information:

  • Which representatives should be meeting (primary contacts)
  • How often meetings should occur
  • What topics need to be discussed regularly
  • Whether a formal committee is required and, if so, the mandate of the committee
  • Contact information

What are the benefits?

A communication clause keeps key information in one place and helps avoid confusion later on. Having a good communication protocol helps avoid the stress of trying to figure out how to contact your service partner when there is important business to discuss. It also provides for regular touch points so you don’t go too long without communicating with your service partner. Even when things are going smoothly, going too long without communicating can make it difficult to get on the same page later on.

What are the potential pitfalls?

Some communication clauses are vague or don’t provide the right information. In these cases, they are no better than not having a communication clause at all! When you are preparing or renewing your MTSA, taking the time to agree on how communication will occur over the lifetime of an MTSA can prevent a headache later on.

For more information on communication protocols, and other aspects of MTSAs, make sure to review the the handbooks below.

Municipal Type Service Agreement (MTSA) Checklists

We’re excited to share our newest resource: MTSA Checklists.

The Pathways to Service Delivery Guide and MTSA Handbooks were created to provide accessible information on negotiating and preparing effective MTSAs. The new MTSA Checklists will help you and your service provider make sure all your bases are covered when you’re ready to build your service agreement.

The three MTSA Handbooks cover four of the most common types of MTSAs:

The new MTSA Checklists are a direct complement to these Handbooks. They allow you and your service provider to cover each section of a service agreement step-by-step. If you get stuck or have questions about a section, the Pathways to Service Delivery Guide and MTSA Handbooks provide additional details.

Each section of the MTSA Checklist corresponds to the same section in the MTSA Handbook, making it easy to flip back and forth when you need more information. For example, Section 5.0 Roles and Responsibilities corresponds to the same section in the Handbooks. Making decisions about roles and responsibilities is simplified by the checklist, which provides a series of options that you and your partner can consider and check.

How to choose a term for your agreement – and how to end it when things change

You’ve decided to enter into a contract with a neighbouring municipality for the provision of services to your community. You know what services you need, you know where they are needed, you know who to engage to make it happen, and you know how to get what you need – by entering into a service agreement. The one remaining question is when – how long does this agreement need to be in place?

There is no fixed time a service agreement must be in place for, therefore it is open to you to decide whether the duration of your agreement is effective for a short, medium, or longer term. You also have a say in how the agreement is suspended or terminated, and the process to be followed. The term of the agreement is in place to provide stability to both partners for continuation of service, and the suspension and termination terms are written to ensure the contract is not broken without due cause or following a fair process, so take the time to think about what you would like to see in these terms.

If it’s your first service agreement, you may think that keeping the contract valid for a short (1-5 years) period of time is your best bet. Agreements on this term can provide greater flexibility for you and your service provider, as it reduces the amount of time that you are locked into the agreement. For non-critical services (i.e. not an immediate risk to public health and safety), such as garbage collection, a short term is a reasonable choice as your options for providers is likely varied, and you may not need to make infrastructure investments to enable the service, which allows for more flexibility in changing how your service is provided.

A short term contract is not always the best choice, however. If your community has needs for critical services that protect the health and safety of the community (e.g. water or fire protection), an agreement with such a short term could endanger the stability of the supplied service to your community. In instances where your option for service providers is limited, or an investment in new or upgraded infrastructure is required, it’s preferable to ensure your agreement is for a long-term.

The process of negotiating or re-negotiating a service also takes time and effort – not only does a short agreement term result in frequent negotiations, but it leaves your community at risk of losing the service if the negotiation process takes longer than expected.

Termination and Suspension

Parties usually enter into agreements with good intentions. Trust, and an attitude of good faith are some of the most important things to take into a service agreement partnership that will provide benefit to both parties. It’s common for parties to continue to build their relationship, and trust, and good faith throughout the service agreement. But in rare circumstances, things can change, and one or both of the parties may wish to terminate the agreement.

Reasons for termination may not always be about the relationship or a breach of contract by one of the parties. Agreements may also be terminated because needs for services, ability to deliver services, and priorities change. Including termination or suspension terms in your agreement is beneficial to both communities.

Suspension is an intermediate step between provision and termination, allowing the party in breach of contract to correct the offending issue to preserve the agreement. Suspension of service terms are more appropriate to include in service agreements for non-critical services, such as garbage collection or animal control; than for critical services like water and sewer, or fire protection. The suspension may only apply to specific services within the service agreement. For example, in a water service agreement that includes operation and maintenance services, the suspension term may only refer to the operations and maintenance portion of the services. This ensures that the part of the service that is critical to health and safety (water supply) is not affected. Your agreement should outline the conditions and process for suspension, and the process for resuming services after the issue has been resolved.

Termination is the discontinuation of the agreement. An agreement can be discontinued with or without cause. Your agreement should clarify the specific acceptable reasons for termination so there are no surprises. Give yourself time to react by detailing what kind of advanced notice is required for suspension or termination. Typical notification periods for non-critical services with more service delivery options are 60 days or 120 days. For services that require infrastructure investment or longer lead periods to make alternate service delivery arrangements, such as water and sewer, the notification period should be longer (i.e. up to a few years).

You should decide who has the authority to suspend or terminate the contract. In case of termination, clarify if capital contributions or rates paid in advance will be reimbursed and on what basis.

With careful thought to your community’s service needs and timelines, you should be able to identify the best term for your agreement, and a suitable process for suspension or termination. This will help to ensure long term stability for your community and to ensure smooth renegotiations when required.

The Municipal Type Service Agreement Assessment (MTSA) Tool

For first timers, the process of developing a service agreement can be complex and intimidating. You likely want to reach a deal that is fair, strong and meets the needs of your community. But how do you know if the service agreement you are negotiating is fair, or strong enough protect your community or will continuously meet the needs of your community?

Perhaps your community has an existing service agreement in place and you’ve been tasked with re-negotiating your agreement as the term of the agreement is set to expire. How do you know if your current service agreement is a good deal for your community?

Whether new to developing and negotiating service agreements or not the Pathways to Service Delivery website contains various resource tools to assist First Nations and municipalities through the negotiating process, including a Municipal Type Service Agreement Assessment Tool.

The Assessment Tool was developed to help First Nations and local governments identify and discuss the strengths and weaknesses of the service agreement being negotiated or already in place. It was recently used at the Pathways to Service Delivery Introductory Workshops, where each participant had one of their service agreements reviewed to point out areas where they were strong and where there was room for improvement.

The Assessment Tool can be used in a number of different situations:

  • You are preparing to re-negotiate your service agreement, and want to evaluate the strengths and weaknesses of the agreement you have in place.
  • You are negotiating a service agreement, and you want a structured way to review a draft agreement that is presented to you.
  • You are tasked with administering a service agreement that is already in place, and you want to be aware of what the agreement includes and does not include.

The Assessment Tool outlines 10 different components that are typically included in the terms of an agreement. The tool allows the user to rate the ‘performance’ of each component. Performance is broken down into three levels:

  • Level 1: Needs improvement
  • Level 2: Adequate Performance
  • Level 3: Good Performance

1. Term of Agreement: Outlines the duration of the contract.

2. Renewal Terms: Makes it clear whether the agreement can be renewed, and the conditions for renewing it.

3. Service Area: Identifies what specific homes, buildings, or areas in the community will receive the services.

4. Level of Service: Clearly states the qualities of the service being provided and paid for.

5. Roles and Responsibilities: Clearly state what each party is responsible for under the agreement.

6. Suspension of Services: Identifies the conditions and procedures for temporarily stopping services.

7. Termination: Identifies the conditions and procedures for ending an agreement before the end of its term.

8. Notification: Outlines when each party needs to contact one another and the procedures for doing so.

9. Growth and Development: Establishes the conditions under which additional units, buildings, and areas can be added to the service agreement.

10. Dispute Resolution: Establishes procedures for when there is a disagreement between the parties.

To determine the performance level of each component, simply read the descriptions provided for the different levels and select the one that most closely describes your service agreement. For example, if your service agreement includes termination provisions but excludes specific conditions that would cause the agreement to be terminated, you would select level 2: adequate performance. The tool recommends service agreements achieve at least a level 2 on all 10 components. If your service agreement only meets a level 1 for one or more categories, make note of the reason why and discuss any concerns with your partner municipality as negotiations continue. It is not always necessary to strive for a level 3 in every category, if you and your service delivery partner are both satisfied with a level 2.

The assessment tool can be used by a First Nation independently or collaboratively with the service agreement partner, which can further strengthen the relationship and level of trust between the two governments.

Please note, the assessment tool is not intended to be a substitute for a legal review.

Announcing New Resources: Handbooks for Developing Municipal Type Service Agreements

When this blog started, the goal was to provide First Nations and local governments with stories and advice focused on the process of developing municipal type service agreements. These agreements are integral to many First Nation communities, providing members sustainable access to basic everyday services such as water, sewer, fire protection, and garbage collection.

Developing a service agreement can be complex and intimidating to those tasked with the important role of administering these services. The process however, can be broken down into stages:

  1. Identifying Your Needs.
  2. Determine if a service agreement is the best option, and if it is feasible.
  3. Work together with your service delivery partner to develop principles and a process for negotiation.
  4. Negotiate the terms of the agreement.
  5. Sign the agreement (and host a signing ceremony!).
  6. Administer the agreement for ongoing service delivery.

The Pathways for Service Delivery website houses templates, guidebooks, and other resources to guide First Nations and local governments through the different stages of developing a service agreement. The newly released handbooks, Developing Municipal Type Service Agreements, act as a compliment to those resources. These handbooks serve as bridging documents to the Pathways to Service Delivery Guide and the service agreement templates developed by the Federation of Canadian Municipalities (FCM). A handbook has been developed for some of the most common types of service agreements: Water and Sewer Services, Fire Protection Services, and Garbage Collection and Disposal Services.

The Pathways to Service Delivery guide provides and overview of what is needed to negotiate a service agreement. It provides suggestions, tips, and resources as well as where to find other helpful resources. However, it does not show step by step instructions on the many intricacies of physically developing an agreement. On the other end of the spectrum, the FCM Templates act as guides for drafting a service agreement. It includes clauses that can be altered, added, and deleted to ensure the agreement is tailored to meet the unique needs of a community.

Developing Municipal Type Service Agreements Handbook outlines 11 core components, or contract terms, that typically make up the terms of a service agreement. It identifies certain decisions that will need to be made in order to craft terms that reflect your unique service agreement, as well as important points to consider when making those decisions. Similarity to the FCM Templates, the Handbook also highlights example contract terms that can be used or modified directly in your service agreement.

The Developing Municipal Type Service Agreements Handbook is tailored to those ready and negotiate the terms of their agreement. Think you’re ready to use this handbook? Can you answer yes to each of the following questions?

  1. Do you have an understanding of what your service needs are?
  2. Have you identified that a service agreement is the most effective way of meeting these needs?
  3. Have you developed a memorandum of understanding and/or principles for working together with your neighbouring municipality?
  4. Have you determined that service delivery through a service agreement is feasible?
  5. Have you done some preparation to understand your neighbouring community better?

Once you can positively answer the questions above, you’ve likely done the prep work necessary to ensure the negotiation stage of developing a service agreement is as smooth as possible. Nervous about the negation process itself? Read our blog post on ‘The 10 Top Tips for Negotiating a Service Agreement’.

Using The Cost Calculator

Preparing to negotiate a service agreement with your neighbouring community can seem like an intimidating task for any First Nation. You may have read in a previous blog post, ‘Knowing Your Municipal Service Needs…And What’s Possible’, that the best place to start is by identifying exactly what it is your community needs.

Once you’ve determined your needs, the next step is understanding what it might cost to provide the service you need before sitting down with your neighbouring municipality. Preparing yourself with this information will create a more open and informed negotiation process. The Pathways to Service Delivery website contains various resource tools to assist First Nations and municipalities through the negotiating process, including a cost calculator.

The cost calculator is an interactive Excel based tool developed to highlight information about the costs of services, such as water and sewer. While the cost calculator will not provide you with the exact rate, it acts more like a tool for discussion purposes with your neighbouring municipality, to better understand what goes into determining the rate.

excel-logoExcel Cost Calculator

 
 

The cost calculator is not only a great tool for First Nations preparing to negotiate a service agreement for the first time but also those First Nations with existing service agreement that are nearing their expiration date.

How exactly does it work?

The cost calculator supports the user in thinking about what a fair rate might be for providing a service to their location. It assists in estimating how much the First Nation might pay annually for services and based on the annual estimated cost, how much of that cost is eligible to receive funding from INAC and how much would need to be funded through other sources of revenue. To determine these costs, the cost calculator relies on information about rates in the neighboring community and helps the user compare rates and levels of service.

The cost calculator includes three services, all which are eligible for funding through INAC. These include water, sewer, and fire protection. Because fire protection varies so much from community to community, the calculator provides a range of average rates per household. This can be used to give people an idea of how their rate compares with rates in other communities. Also, from time to time, service agreements might cover a full bundle of services. Some of these services may already be provided by the First Nation, in which case it may be fair to apply a credit of up to 100% for that service. The cost calculator helps the user review different services that are often included in a service bundle and consider which ones might receive a credit and why.

For the cost calculator to work, you’ll first need to identify and provide some basic information including, the municipal rate for the service, the number of member homes, and the number or non-member homes who will receive service. For water and sewer, you can identify municipal water rates by looking at the Water and Sewer Bylaw of your neighbouring municipality. This bylaw is publically available information and should be accessible through the municipality’s website.

By inputting these values, the pre-formatted Excel sheet will display estimated rate for how much your First Nation might pay annually for services, how much of that cost is eligible to receive funding from INAC and how much would need to be funded by your community through other sources of revenue.

Now – let’s go through an example, looking at what BC First Nation, a fictional community, might pay for water through their neighbouring municipality, BC Town.

The Administrator from BC First Nation has already gone onto BC Town’s website to find their municipal water rate.

Pathways-4-Service- FeesAndCharges

Pathways-4-Service-MeteredRates_v3

Looking at BC Town’s water user fees, the Administrator can see the Town charges a fixed rate only and has no volume rate. This varies from community to community with some municipalities only charging a fixed rate, while others use a combination of a fixed rate and volume rate.

The Administrator has taken the municipal water rate and the number of member and non-member homes and entered it into the cost calculator. Because a service agreement is not yet in place, simply enter the same rate you entered for the municipal water rate and the calculator will provide an initial estimate based on the rates in BC Town.

EstimatingCosts

From there, the Administrator is able to better understand what it might cost to provide water to their members through a service agreement with BC Town annually ($81,316.44) if rates were the same as in BC Town, as well as how much of that annual cost would be covered through INAC funding ($60,211.01) and how much the First Nation would need to pay for themselves through other sources of revenues ($21,105.43).

The Administrator of BC First Nation knows that the service agreement with BC Town will not include operations and maintenance of infrastructure on reserve, so the rate that is paid for on-reserve service through the service agreement may be less than what is paid by customers of BC Town off-reserve.

The Administrator can now go into discussions with BC Town with a baseline of costs that can be discussed with BC Town, to get a better understanding of what will be included in the rate and how it will compare to the rate being paid in the Town.

Pathways-4-Service-AssumedValues