Have you heard the following myths about First Nations lease lands?
- The band blockades roads
- Rent is jacked up without notice
- The certificate holder (generally an individual band member) took back the land without notice
None are true. First Nations lease agreements work just like regular leases – there’s a contract that’s signed and followed between all parties involved with the lease.
How First Nations Lease Land Agreements Work
The following illustrates the dynamic within leased land.
This is the agreement between the developer and the land’s certificate holder. Here’s how the agreement typically works:
- Lease length – it’s almost always 99 years
- Rent – the amount the lease is per month
- Insurance – developer must get proper insurance (e.g. fire insurance)
- Construction requirements – everything must be built to code, and all construction must be approved by the certificate holder
- No contaminants policy – e.g. no oil leaks from vehicles, dumped chemicals, etc.
- Occupancy – developer states whether the property is residential or commercial
If the leasee (developer) doesn’t follow the agreement, the certificate holder can terminate the lease. A property manager isn’t involved with a head lease.
This is the agreement between the developer and the owner (or owners, depending on the development size).
All terms that are in the head lease transfer down to the sublease (from construction approval to rent amount). The main difference is that sub-leasees are communicating with the developer, not the certificate holder.
The sublease also spells out what the developer is providing in return for rent. This is normally a building (e.g. renting out a unit in a commercial building).
A property manager can be hired to:
- Help enforce the sublease
- Educate the elected board of directors
Lease Land Properties Need A Board Of Directors, Not A Strata Council
Properties on leased land can be businesses or residential.
A board of directors has many of the same duties a strata council does:
- Bylaw enforcement
- Bylaw creation
- Property maintenance, like:
- Leaking roofs
- Budgeting for:
- Contingency funds
- Maintenance fees
A board of directors needs to file an annual report, which is the same for both commercial and residential and includes a:
- List of shareholders involved with the businesses within the development
- List of directors on the board