New Brunswick

Pabineau chief in talks with Higgs on possible new tax-sharing deal

A First Nations chief in northern New Brunswick says he has started one-on-one negotiations with the Higgs government for an agreement that could include a modified tax-sharing formula.

Province pulled out of gas-tax sharing agreement with 13 Mi'kmaq and Wolastoqey First Nations April 13

Pabineau First Nation Chief Terry Richardson said a revised deal could make it 'more of a palatable situation' to Premier Blaine Higgs. (CBC News)

A First Nations chief in northern New Brunswick says he has started one-on-one negotiations with the Higgs government for an agreement that could include a modified tax-sharing formula.

Pabineau First Nation Chief Terry Richardson says he met with Premier Blaine Higgs and Aboriginal Affairs Minister Arlene Dunn in Moncton on Wednesday "to see if we can make some movement on the taxation agreements." 

That meeting came just more than a week after Higgs announced he was cancelling the tax-sharing deals with 13 First Nations and appeared to rule out any form of tax sharing in the future.

Richardson says a modified formula is possible now that negotiations are underway.

"I believe it would be a revamped type of position, an agreement that would include, possibly, some form of a taxation agreement," he said. "That is on the table."

He said a revised deal could make it "more of a palatable situation" for Higgs, who said April 13 that the revenues being diverted to bands was projected to grow to $75 million a decade from now.

Richardson agreed with the premier that's not sustainable so he's willing to strike a deal "that could actually make it so that it's more acceptable to government and more acceptable to First Nations."

That might include a tax-sharing element that would be phased out over time as a band's economy develops, the chief said.

Any tax-sharing would be a shift in position for Higgs, who said when he announced the cancellation that diverting of tax revenue to bands would not be on the table in future talks and that on-reserve retailers would now collect and remit provincial tax like any other business.

Higgs did not respond directly to a question about the possibility of tax sharing being part of a deal with Pabineau.

"We're looking at a sustainable path forward and right now we don't have one," he said. "There are a lot of factors that can contribute to a sustainable path forward." 

Higgs said there was "tremendous alignment" during his meeting with Richardson.

Pabineau is a member of Mi'gmawe'l Tplu'taqnn Incorporated, which on April 13 called Higgs's cancellation of the agreements "a new low in the relationship with Indigenous people."

The agreements allow bands to get 95 per cent of all the provincial tax revenue from on-reserve retail operations up to $8 million, and 70 per cent of the revenue above that amount.

Community approach

Mi'gmawe'l Tplu'taqnn said the revenue helps fund on-reserve education and social services that don't receive enough money from the federal government and called the cancellation "completely disrespectful."

Richardson said his decision to negotiate one-on-one with the province isn't a blow to a united front but a recognition that reserves have different circumstances.

"This agreement is going to affect each First Nation differently, so what we've decided to do is take a community approach to go and see what's in the best interest of Pabineau First Nation, if we can come up with an agreement," he said.

"We're all at different places in our development, in our economic growth."

He also said his reserve is "under a gun" to start negotiating. While seven bands have tax agreements that aren't cancellable until next year, Pabineau is one of six whose deals can be cancelled with 90 days notice, which Higgs gave them earlier this month.

Figures provided by the province show Pabineau brought in $2.2 million from the tax-sharing agreements in 2020-21, the sixth-highest amount among the 13 bands with agreements.

The band has a restaurant, gas station and store and is planning a larger gas station, strip mall and a combined gaming centre, bingo hall and farmer's market on new reserve land.

Appeal to MLAs

News of the chief's meeting came a day after six Wolastoqey chiefs wrote to Progressive Conservative MLAs, appealing to them to persuade Higgs to change his mind on the cancelled deals.

In a letter, the six chiefs specially called out PC MLAs whose ridings are on traditional Wolastoqey territory along the Saint John River.

"Your constituents living in First Nation communities up and down the beautiful Wolastoq, need your voice," the letter says. "We deserve no less. We ask that you encourage your government to stop and reconsider the cancellation of our agreements."

'Really hurtful'

Kingsclear First Nation Chief Gabriel Atwin says revenue from his band's gas station and convenience store outside Fredericton, on the way to Mactaquac Provincial Park, funds recreation, mental health and education programs.

"It's such a vital part of our economy," he said. "It's really hurtful when I think about it, what we're going to have to do if we can't reach some sort of new agreement."

"This store is a community store. It's not owned by an individual. There's no individual that's benefiting. We're benefiting as a community."

Kingsclear First Nation Chief Gabriel Atwin said he's also 'keen' to meet with the premier. (Jacques Poitras/CBC)

The letter said  the cancellation of the agreements will lead to "conflict, legal battles, and loss of revenue for Indigenous and non-Indigenous governments alike."

It also argues the band already compromised four years ago when the deals were renewed and they agreed to the smaller 70 per cent share of revenue above $8 million and to not undercut off-reserve competitors on gas and tobacco prices.

Atwin said chiefs are looking at asserting their self-governance rights, which could see them refuse to recognize the province's taxation power on reserves. That in turn would allow them to sell gas and other products tax-free at much more competitive prices.

But he also said he's willing to negotiate.

"I'm very keen on meeting with the premier and discussing next steps," he said. "Cancelling the agreement is nonsense. It shouldn't have happened this way, but it did, and we're going to move forward and hopefully have some dialogue soon with the premier."

York PC MLA Richard Ames, whose riding includes Woodstock First Nation, said in an email statement that because the letter mentions the possibility of legal battles, he would not comment on the plea for backbenchers to lobby Higgs.

"I would encourage all chiefs that signed the letter that was sent to me to please reach out to the minister responsible for Aboriginal affairs directly as the provincial government has invited all First Nation chiefs to co-create a modern and sustainable economic partnership," Ames said.

No other PC backbench MLAs responded to an interview request.

Dunn did not immediately respond to a request for a comment on the letter and her Wednesday meeting with Richardson.

A spokesperson for the six Wolastoqey chiefs said none of them would be seeking individual agreements with the province.


Jacques Poitras

Provincial Affairs reporter

Jacques Poitras has been CBC's provincial affairs reporter in New Brunswick since 2000. He grew up in Moncton and covered Parliament in Ottawa for the New Brunswick Telegraph-Journal. He has reported on every New Brunswick election since 1995 and won awards from the Radio Television Digital News Association, the National Newspaper Awards and Amnesty International. He is also the author of five non-fiction books about New Brunswick politics and history.