“With respect to land, I am arguing the Indian Act basically removes appropriate jurisdiction (over land use decisions) from First Nations to the federal government,” Deaton, the 2017 University of Manitoba Kraft Lecturer, said during a presentation Oct. 25. “It does not allow First Nations to basically get into the promise of exchange… and therefore constrains economic development.

Earlier in the lecture, Deaton said if communities have the autonomy to voluntarily engage in trade or other economic activities, both parties can benefit. He pointed to his children after collecting candy Halloween night.

“They would come into the house with a fixed set of resources and sit down with each other and… they would trade (candy),” he said. “Their happiness, if you will, was made greater with a fixed set of resources by the exchange.”

They started with two key assumptions. One was that the candy they collected was their property. That’s important because they could’ve opted to dump their candy in one pile and share it. Secondly, they each had control over the decision to trade or not to trade.

No control

The Indian Act, first proclaimed in 1876, requires that First Nations get the federal government’s approval before doing almost anything on their reserves, including negotiating water-sharing agreements.

Only about seven per cent of Manitoba First Nations currently get water from nearby jurisdictions, Deaton said.

Deaton suspected at the onset of his research that the rate of boil-water orders on First Nations with water-sharing agreements would be lower. His research confirmed it, finding an 11 percentage point decline.

Deaton estimates 13 per cent of Canadian First Nations could get water from nearby municipalities, if they had the legal authority to do so.

The strategy would be less effective for isolated First Nations and those with a low population density, Deaton said.

There are about 600 First Nations in Canada and most are “homogenized” under the Indian Act, he said.

“It’s a nightmare because any changes in the rules that govern the land are not decided at the First Nations level,” Deaton said. “It has to have the approval of the federal government.

“Institutional rigidity with respect to the land issues I am arguing has constrained broadly economic development and the transaction costs with respect to land.”

Glacial pace

Changes are coming, but slowly. In 1996 the Framework Agreement on First Nation Land Management was developed to give First Nations the option to manage their own land and resources, but not sell their land.

“First Nations (that participate in the framework) will now be in a position to maintain effective intergovernmental relationships with municipal, provincial and federal jurisdictions, and be recognized as such by the courts,” Deaton said.

There’s a lengthy, transparent process First Nations must go through before signing the framework, he added.

Around 72 First Nations operate under the framework now. Another 53 are in the development stage.

“It is my claim, as well as other scholars, when institutions harmonize relationships between people with respect to things so it expands trade over increasing distances, with increasingly unfamiliar agents, that it’s an important component that not only leads to growth but improvement in human well-being,” Deaton said. “But when those institutions fail to do that, when they have a pernicious effect, when instead of co-operation and harmonization, there is dispute and conflict, then the effect is diminishing and localized exchanges that occur do not enhance health and welfare.”

African roots

Deaton’s interest in the role of institutions and regulations began in 1992 when working for the American Peace Corps., in Lesotho, South Africa. His project was to help set up rotation livestock grazing. It was believed improved livestock production and better local soil conditions would make the local people better off. But the grazing area fell under the authority of four different chiefs.

“These chiefs didn’t get along… and this project was a complete failure,” Deaton said.

He learned from that failure when working on his next assignment in a poor, rural area in eastern Kentucky’s Appalachia Mountains. Even though it was rural there were urban-like concentrations of homes, but without sewer and water infrastructure.

“When you flushed the toilet everything went straight into the stream… and this was leading to high fecal coliform counts in the river leading to drinking water quality problems,” Deaton said.

Nearby cities could extend their water and sewer services, but for a number of reasons, hadn’t.

“So we created, if you will, a new institution — a county-wide water and sewer district, to lead the existing municipalities to expand their water systems to regions like this,” he said. “Today there are close to 1,000 houses on water in this region because of the institutional innovation of the country water and sewer district.

“There were these gains from mutual co-operation from the exchange of services.”

The role of institutions and regulations in economics isn’t new. The late University of Manitoba agricultural economist the lecture series honours wrote about them.

“Clearly the institutional rigidities associated with regulations, standards and non-transferable status rights should continually be drawn to policy-makers…” Kraft wrote in 1991, Deaton noted.

“The most enduring intellectual capital that agricultural economists can provide to resolve sustainable agricultural issues will be through improved institutional arrangements. Now let us show our creativity by proposing new, imaginative institutional arrangements…”

Ag economics, farmers and First Nations

How did universities come to have Departments of Agricultural economics? And should this model be mirrored for Canada’s Indigenous population for similar reasons?

The first point is a question Brady Deaton, a University of Guelph agricultural economist, McCain Family Chair in Food Security and this year’s University of Manitoba Kraft Lecturer, put to T.K. (Sandy) Warley, a former head of the University of Guelph’s agricultural economics department.

Warley said they came about because rural people, including farmers, weren’t doing as well as others in society.

“I think about that a lot because the farm population today, with the families of the farm population is about 600,000, and those people are doing, thanks to the research that we continue doing, pretty good,” Deaton said. “They (farmers) would be comparable (now) to other people in terms of their income. We have twice as many… Indigenous people who seem to fit the mandate Sandy Warley suggested — a group of rural people, rural businesses and rural communities… that aren’t doing as well as other people.”

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The all-cash deal for Broomfield, Colorado-based MWH Global, which Stantec said is expected to close in the second quarter could increase Stantec’s annual revenues by about 60 per cent, to more than $4.5 billion, while its global headcount will increase from about 15,000 to 22,000.

The transaction will see Stantec expand in the water infrastructure sector, one of the fastest growing infrastructure areas in the world.

MWH is a privately-held global engineering, consulting and construction management company focused on water and natural resources projects. It now has 6,800 employees worldwide, with 187 offices in 26 countries.

Stantec says the deal will position it as a global leader in water resource infrastructure markets, including in the U.K., Australia, New Zealand, South and Central America, Europe and the Middle East.

The transaction significantly expands Stantec’s footprint outside of Canada and outside the struggling energy sector, where it began life as an environmental consulting firm. After the transaction, about 70 per cent of its revenues will come from outside of Canada.

Gord Johnston, Stantec’s executive vice president of infrastructure said it is “the most exciting acquisition in the history of the company,” allowing it to grow substantially in the fast-growing areas of water and transportation infrastructure.

He said the “synergies” between both companies are ideal.

“We work with the same types of clients,” he said. “About 70 per cent of their clients are public agencies, while 50 per cent of our clients are the same. Among the private clients, including mining and oil and gas firms, we work for many of the same companies.”

Johnston said in the engineering and design field, corporate culture is a key component, since there essentially are few physical assets involved. He said MWH has a culture very similar to Stantec’s, with many long-term, experienced employees.

Also the companies both have a similar history, with Colorado-based MWH having beginning 1950s as a firm focused on water infrastructure.

He said U.S.-based media reporters had asked if the acquisition would lead to job losses in centres, such as the Denver area, where both companies have a presence.

“We’re far away from deciding what will happen at our offices” where there might be duplication, he said.

However, he said there is little likelihood that will happen in Canada, since MWH has a minimal presence in the country.

Johnston said the deal is unlikely to lead to much of a growth in head office staff in Edmonton, where it employs about 2,000 people.

He said Stantec will want to maintain an MWH presence in many of the 187 offices it has maintained, adding that its strength has been in that local footprint.

The Stantec executive, who oversees the company’s 1,500 employees engaged in water infrastructure, said he’s excited about the growth prospects in that area, given the strength of MWH in the sector.

Given concerns raised recently in the U.S. about poor water infrastructure, such as the lead poisoning scare in Flint, Michigan, where poor water infrastructure was cited as the cause of lead-related health issues, he said he expects the U.S. to greatly increase its spending on water-related projects going forward.

He expects the same thing to happen in Canada, where the federal Liberal government is committed to large expenditures on infrastructure.

Worldwide it will be a growing area of expenditures as well.

In addition, MWH has a large presence in the area of transportation infrastructure — also a Stantec strength — and he expects spending to be ramped up worldwide in that area.

Stantec was founded by Don Stanley, an Edmonton native who retired from the company he founded in 1983 and passed away in 2001. He launched the business with a focus on environmental services. But, with the subsequent addition of partners Herb Roblin and Louis Grimble, with backgrounds in bridge and railway engineering, the firm diversified and grew quickly.

That growth continued over the next 30-plus years, as what was then known as Stantec Inc. became publicly-listed on the Toronto Stock Exchange (TSX) in 1994 and was listed on the New York Stock Exchange (NYSE) in 2005.

Sonia Kirby, head of investor relations for Stantec, said the company, a true Canadian success story, continues to have deep roots in Edmonton.

One of its largest recent acquisitions, prior to the MWH deal, involved privately-owned, Quebec-based Dessau, which was established in 1957 and had 1,300 employees in 20 offices located throughout the province.

Prior to that acquisition, which became effective in the first quarter of 2015, Stantec had a relatively minor presence in the province.

In a conference call that followed the release of its 2015 results, Stantec head Bob Gomes said the company will continue to focus on increasing its presence in the U.S., where it now has about 6,500 employees.

But he also said the company is planning to grow internationally, where it now has only about 300 employees and where revenues account for a small percentage of its overall operations.

— This article has been sponsored by Glacier FarmMedia as corporate sponsor to the upcoming Centrallia conference in Winnipeg, May 25 to 27.

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Sixty-four per cent told Probe Research, in a poll conducted for the Association of Manitoba Municipalities, they support that idea.

That’s a jump of support by 10 per cent from 2008 when the AMM asked the same question at the onset of their push for new municipal revenue streams. Three years ago a poll of 1,000 Manitobans showed just over half (54 per cent) supported the idea.

Given five options for the province to dedicate additional revenues from the provincial sales tax (PST) to a specific purpose, 44 per cent indicated they would dedicate these funds to community infrastructure improvement. That’s higher than the 27 per cent in favour of dedicating it to health care or 11 per cent wanting it to go to education. Manitobans age 55 or older are the most favourable to a municipal sales tax (74 per cent) versus those aged 18-34 (56 per cent). Women (36 per cent) are less likely than men (52 per cent) to favour infrastructure over other priorities.

Overall, nine in 10 respondents agreed with the statement, “Our communities need help.”

AMM president Doug Dobrowolski said the results show Manitobans now understand the fiscal bind faced by local government.

“This survey just reinforces what we already believed — most Manitobans will support additional revenue for municipalities if the funds raised go directly to an area of great need. That area is infrastructure.”

The AMM’s call for new revenue streams was the focus of its Putting Communities First campaign in the leadup to last October’s election when AMM held meetings with municipal leaders and other community representatives across the province to talk and list specifics on infrastructure needs. Over half of all towns listed streets and roads repairs and water infrastructure as top priorities, with deteriorating sidewalks, playgrounds in need of upgrades and halls in need upgrades and repairs as other major concerns.

The AMM has calculated a dedicated tax would generate about $240 million in additional revenues which the province’s 197 municipalities could then share through per capita distribution. The province’s estimated infrastructure deficit is at $11 billion, or $10,000 for every Manitoban.

In a recent op-ed piece, Dobrowolski cited Federation of Canadian Municipalities’ calculations that showing for every $1 spent on infrastructure, the federal, provincial and territorial governments received 35 cents through new income and sales tax.

“In other words, infrastructure spending is not a drain. It is an investment that will help communities,” he said. Premier Greg Selinger told delegates at the AMM Annual Convention in November that he would not consider a municipal sales tax. AMM will hold its annual mayors’ and reeves’ meetings in March.

The survey was conducted among the Probe Research Online Panel between November 14 and 21 last year with 657 persons, or 24 per cent of those approached, responding. As per guidelines established by the Marketing Intelligence and Research Association (MirA) no margin of error is given for this online survey.

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Now, they’re faced with another bill coming due – the anticipated $25 million it will take over the next five years to meet new provincial regulations for nutrient removal from waste water.

Crumbling infrastructure is not just cities’ problem these days – it’s a steady decline facing virtually every small town and village in rural Manitoba stemming from years of neglect, says Portage la Prairie Mayor Earl Porter.

“We’ve been ignored for years and now we’ve got a problem so big we don’t have the dollars to fix it.”

Reeve of the RM of Portage la Prairie Kam Blight echoes Porter’s sentiments. Some RM residents don’t have access to clean drinking water, but the RM doesn’t have the $5 million to $7 million needed to construct the rural water plant to provide it, said Blight. It also faces major drainage and other water infrastructure work, yet has just small amounts of cash at any one time to tackle it.

Blight doesn’t like to speculate, but as he looks ahead he doesn’t see a strong future for rural Manitoba if these needs go unmet.

“We’re going to lose people,” he said.

INFRASTRUCTURE NEEDS

Blight and Porter were among dozens of municipal leaders who met in late August with representatives of the Association of Manitoba Municipalities to talk specifics on what rural Manitoba’s communities need if they are to keep roads, water systems and other fundamental infrastructure intact.

The meetings are part of the AMM’s pre-election Putting Communities First campaign to press the issue with provincial candidates seeking election this fall as well as highlight the need for new municipal revenue sources.

Municipal leaders have spent the past two weeks meeting with AMM officials as well as provincial candidates in Dauphin, Gimli, Brandon, and Lorette.

Like Portage la Prairie, Gimli foresees a $10-million bill to replace aging water lines that date to the 1950s, and owes another $8 million for a sewage treatment plant with about 20 years’ life expectancy left.

Brandon, likewise, eyes a massive bill of $165 million for all its major infrastructure repair needs, including work done to water mains that are now over a century old.

In Lorette, community leaders see a decline in school enrolments, yet cannot afford to develop serviced land for new housing.

In Dauphin, lack of high-speed Internet and cell service topped the list of infrastructure needs.

TOP PRIORITIES

Over half of all towns list streets and roads repairs and water infrastructure as top priorities. Cracked sidewalks, playgrounds in need of upgrades and decrepid halls are other concerns.

The province’s municipal infrastructure deficit has been estimated at more than $11 billion, or $10,000 for every man, woman and child living here.

At August’s end, 70 per cent of the province’s 197 municipalities had passed resolutions calling on all parties to commit, if elected, a portion of existing PST revenue to repairing and upgrading the infrastructure in Manitoba communities.

Coming up with the money is impossible for local governments, many of whom are at their borrowing limit, said AMM president Doug Dobrowolski in an interview following the Portage gathering August 25.

The next government must help local government develop alternate revenue sources, Dobrowolski said, adding that there needs to be focused attention on a host of sources. One of AMM’s “asks” is for one cent of the existing provincial sales tax to go to municipal infrastructure – which would produce $249 million annually.

The other is for a rebate on a tax one level of government now levies on the other.

REBATE

“We’ve been asking that the government rebate the PST portion that municipalites pay to the province,” said Dobrowolski. That would be another $24 million, and it’s money that local government leaders say shouldn’t be flowing out of their coffers in the first place.

“We don’t feel it’s right that one level of government is taxing another level of government,” he said.

They also call for an end to provincial downloading and new regulation that comes without dollars to comply.

“We need to be looking at a whole host of things, not just one or two,” Dobrowolski said. “Let’s streamline some processes. It could save everybody some money, the province included.”

The AMM launched its Putting Communities First campaign this spring to make sure rural communities’ needs get attention by candidates in the lead-up to the October 4 provincial election.

The campaign starts this month with media advertising in print and radio advertising.

lorraine@fbcpublishing.com

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The announcements came as welcome news in the nation’s No. 1 farm state, where dramatic cutbacks in water deliveries by the U. S. Bureau of Reclamation and the state Water Resources Department had idled thousands of farm workers and 300,000 acres (121,400 hectares) of cropland.

Shortages have also forced cities and counties to ration water, raise rates and impose strict mandatory conservation measures that turned lawns brown and left cars unwashed.

WINTER STORMS

But a series of strong winter storms that could mark the end of a three-year drought has left several feet of snow on the Sierra Nevada mountain range that serves as California’s principal source of surface water.

In light of that deluge, this year the Bureau of Reclamation will supply most California users with 100 per cent of the water they are contracted to receive, U. S. Secretary of the Interior Ken Salazar said.

Irrigation districts south of the Sacramento-San Joaquin River Delta, which represent farmers on the west side of the state’s Central Valley, would get 30 per cent of their allotment, or three times more than last year.

The Central Valley is one of the country’s most important agricultural regions, and the state produces more than half of the fruits, vegetables and nuts grown in the United States.

Separately, California officials said they were increasing the amount of water they expected to deliver from the State Water Project this year from five to 15 per cent of normal.

If average precipitation continues for the rest of the winter, a California Department of Water Resources spokesman said, the state’s final allocation for the year could rise to 35 to 45 per cent of requested amounts.

NOT OUT OF THE WOODS

“This is an important step for California and San Joaquin Valley farmers,” Governor Arnold Schwarzenegger said in a written statement.

“I raised this critical issue during my meeting with President Obama recently, and am very glad to see this action from his administration…,” he said. “Now we must direct our attention to the long-term improvement of our water infrastructure to avoid these year-to-year uncertainties.”

Meanwhile state water officials said that California’s long struggle to supply its people with water was not over.

“After three years of drought conditions and a number of mandated pumping restrictions, even a wet year won’t get us out of the woods,” Department of Water Resources director Mark Cowin said. “We need increased conservation, a more reliable water delivery system and a comprehensive solution for California’s water crisis.”

EASE RESTRICTIONS

The dire straits of Central Valley farmers had prompted U. S. Senator Dianne Feinstein to draft legislation that would ease environmental restrictions to allow more water to be pumped out of the Sacramento-San Joaquin River Delta for growers – a plan the lawmaker said she would now drop.

“I will watch this situation very carefully and I am placing my proposed amendment on hold,” Feinstein said in a statement released through her office. “However, I reserve the right to bring it back should it become necessary.”

Feinstein’s plan would have temporarily loosened Endangered Species Act rules designed to protect salmon and smelt and it became the latest flashpoint in California’s long-running water wars – infuriating fishing groups, environmentalists and even members of the powerful Democrat’s own party.

FISHERY COLLAPSE

Opponents had charged that the senator’s plan could ultimately lead to the extinction of Sacramento River salmon and the collapse of the Pacific Coast fishing industry.

The state supplies more than 25 million people and over 750,000 acres (300,000 hectares) of farmland with water from the Sacramento-San Joaquin River Delta, which is fed by rainfall and snowmelt run-off from the Sierra Nevadas.

California water officials say the series of storms that have clobbered the normally sunny state have left snowpack at above-normal levels, but they have so far stopped short of calling an official end to the drought.

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