Frequently Asked Questions

Financial Management Questions

The federal government has committed to fund AFNWA, so why is there not similar willingness to fund individual communities directly to improve their drinking water systems?

What AFNWA proposes is fundamentally different than what is provided through the current funding process through ISC. As such, the AFNWA has secured secure an initial 10-year funding framework, which will be updated every 5-years, to allow for long-term planning for community water and wastewater systems. A regional water authority also has a stronger voice in negotiating a sustainable funding framework with the the federal government.

Since operational funding will be reallocated from members to AFNWA, does this result in a funding shortfall in band operations? If so, what are the plans to relieve the impacts of potential deficits?

No, communities should not expect a shortfall as members of the Atlantic First Nations Water Authority

AFNWA uses currently available federal funding with additional funds provided in the 2022 Federal Budget to provide high quality services and close infrastructure gaps.

Based on current budgets, greater funding will be provided for operations and capital upgrades to community systems with direct economic benefits to member communities.

AFNWA has informed ISC that this is an area of concern for First Nations, and additional community-level funds are being identified.

Will AFNWA charge Bands any additional fee(s) if they join AFNWA?

No individual resident, nor any of the member Bands, will be asked to pay for any central water and wastewater services that AFNWA provides.

As part of the feasibility and development stages for AFNWA, a detailed financial analysis was done, which included funding that is currently provided to each potentially participating First Nation for the operation of its water and wastewater assets annually. This analysis included both the regular and the top-up components of operations and maintenance funding for water and wastewater assets.

As it is intended that AFNWA will assume responsibility over delivering water and wastewater services, the transfer of the associated operations and maintenance funding and top-ups are considered appropriate, with no additional costs to participating First Nations.

Will AFNWA provide operations and maintenance for individual wells and septic systems?

Under current federal policy (i.e., Protocol for ISC-funded Infrastructure) the federal government will not provide funding to AFNWA for the Operations and Maintenance (O&M of individual wells and septic systems.

If individual Bands requests that AFNWA to also oversee operations and maintenance of individual wells and septic systems, it could be carried out on a fee-for-service basis.

If the federal government changes its policy and provides funding directly to AFNWA for operations and maintenance of individual wells and septic systems, The AFNWA would be pleased to provide such service.

Will member First Nations have to redirect all of their operations and management [O&M] funding to AFNWA?

The operations and management [O&M] funding for water and wastewater services is the only category of O&M funding that will be redirected to AFNWA, with the approval of the First Nation community. This transfer would be accomplished as a part of the overall agreement that would be entered into by each member First Nation and AFNWA.

To reiterate, all other regular and top-up O&M funding for other infrastructure would continue to be received directly by that First Nation community.

How is funding managed?

AFNWA funding is managed by professional staff reporting regularly to the Board of Directors.

Business Plans s are developed on a long-term and annual basis, containing projected capital and operations budgets for Board approval.

In support of Business Plans, AFNWA has developed an Asset Management Plan and long-term capital and operations budget to ensure all member communities receive necessary upgrades to their systems and a high level of service through operations.

How will the AFNWA be held accountable to its member First Nations?

The AFNWA’s structure was designed with dual-financial accountability to its participating First Nations communities and the Government of Canada. The AFNWA Board provides oversight for the utility, guides its strategic direction, and delegates specific financial responsibility to the Audit and Finance Committee. ISC provides funding to the AFNWA in accordance with the Funding Agreement. First Nations Financial Management Board (FNFMB) also provides a recommendation of acceptance to ISC based on their evaluation of the AFNWA’s capital and operations budget, and ISC releases funding based on their recommendations. The AFNWA will also submit annual reports to each of its member communities regarding spending and system performance.

Who has oversight of the financial affairs of AFNWA?

Aspects of AFNWA operations are subject to regular compliance checks and established the Audit and Finance Committee to oversee all financial activities. AFNWA readily complies with audits and compliance examinations to ensure that all operations conform to generally accepted accounting principles [GAAP] and governance best practices. External of the Board, AFNWA also reports regularly to the ISC.

For the purposes of its annual audited financial statements at the end of fiscal year on March 31, AFNWA shall establish accounting policies consistent with GAAP for control of revenues and expenses. The Audit and Finance Committee recommends the appointment of the independent external auditor to the Board. The membership shall appoint the independent external auditor annually at the Annual General Meeting by resolution.

The Audit and Finance Committee, with AFNWA Senior Management will oversee the audit process to:

  • Communicate and meet with the external auditor;
  • Assess AFNWA’s accounting policies and ensure that the policies are consistent with GAAP;
  • Review the financial statements and report to the Board of Directors for approval of financial statements; and
  • The Manager of Corporate Services will present the financial statements for approval by the owners at the Annual General Meeting.

The AFNWA is actively pursuing certification with the not-for-profit standards through the First Nations Financial Management Board [FMB] also exploring the option for FMB to provide additional economic oversight on its operations for further transparency and accountability.

How will membership impact a community’s future infrastructure projects, for example, the development of a new subdivision?

Future infrastructure projects such as building a new subdivision not only requires investment in water and wastewater assets, but also in housing, roads, and electrical distribution capacity. First Nations members, with assistance from ISC, would continue to be responsible for the development of new infrastructure on their land. 

AFNWA would ultimately assume operational responsibility for delivery of water and wastewater services to the new subdivision once the assets are commissioned. Therefore, representatives of the AFNWA Engineering Department from AFNWA would be consulted on the required additions to the water distribution and wastewater collection networks, as well as any necessary capital upgrades to the water treatment and wastewater treatment plants to ensure sufficient capacity for the new development.

AFNWA has completed its assessment of the water and wastewater assets of all potential participating First Nations and developed comprehensive Asset Management Plans [AMPs]. The AMPs are a best practice intended to help ensure that the projected useful life of assets can be reached avoiding early, unnecessary, and expensive replacement. AFNWA also holds quarterly workshops with water and wastewater operators from the participating First Nations.

This also means that AFNWA Engineering Department are already developing a working familiarity with each First Nations water and wastewater assets to ensure a smooth transition post-transfer.

How were the capital plans for the AFNWA developed?

The AFNWA’s Asset Management Plans included 10-year capital budgets to keep assets in a state of good repair, ensure compliance with national standards for drinking water and wastewater, and facilitate normal population growth.

How will community funding be allocated to the AFNWA? Did this change?

The Operations and Maintenance (O&M) budgets for participating communities will be re-directed to the AFNWA, for the water and wastewater portion of the funding only. Community water and wastewater O&M funding will be directed to the AFNWA once ISC has received letters from Chief and/or Council, requesting community O&M funding be transferred to the AFNWA. Information on the re-directing of O&M funding for water and wastewater to the AFNWA will be communicated separately to each participating First Nation. The Chief and Council have already been informed of changes to their annual O&M budgets through the Band Council Resolution package submission process. Water and wastewater capital projects will be funded through the validated Capital Plans for each community.