Position of the First Nations
The First Nations noted that activities
taking place on Federal Indian Reservations that earn money involving Status
Indians are not subject to income tax. The First Nations therefore submitted
that, if income tax is being paid to the federal government as a result of
monies earned on federal Indian lands, the revenue should not attract income
tax. The First Nations stated that this should be a flow through issue as far
as utilities are concerned. However the utilities would have to identify that
portion of the rate that is charged to First Nations that is related to income
tax. The First Nations requested that such a direction be made to the
Utilities. In an attempt to determine who the aboriginal customers are, the
First Nations proposed that Aboriginal customers be allowed to come forward
and identify themselves. The First Nations proposed that the income tax
component of the rate for Aboriginal customers that identified themselves as
such could go into a fund. The fund could be accumulated and ear marked for
some Utility sponsored or band sponsored projects to increase consultation
between the bands and the Utilities.
With respect to property taxes paid on
Aboriginal land, the First Nations submitted that there should be an equitable
treatment between property taxes paid on Aboriginal land to that paid on other
land. The First Nations also suggested that there should be help provided to
bands to clarify the costs associated with new service extensions and how the
delineation between rural (farm) and urban (residential) service is made.
The First Nations questioned whether all
of the assets used to service a band could be distinguished from other assets.
The First Nations suggested that this would facilitate the First Nations being
able to evaluate their options with respect to purchasing lines on their land.
With respect to Sustainable Development
projects forecast by TransAlta, the First Nations suggested that TransAlta
could consult with the Peigan First Nation to determine whether their wind
generation project meets the criteria called for in the Kyoto Protocol.
The First Nations noted that First Nations
could own transmission facilities that traverse their land. The First Nations
requested that the Utilities be directed to be open to this possibility.
The First Nations stated that there should
be some recognition that much of the administrative load required in providing
services to bands is provided by the bands themselves. The First Nations noted
that utilities set up offices in towns off reserve that in some situations
primarily deal with service issues for a particular First Nation. The First
Nations suggested that if band administration offices were given agency status
they could serve both the band and the Utility. The First Nations argued that
such an arrangement could provide band members a greater part in managing
their own affairs, save money and presumably reduce the rates they are
required to pay for their service. The First Nations noted with appreciation
that, as a result of the hearing process, the Utilities have expressed a
willingness to meet with the First Nations and address aboriginal issues.
The First Nations suggested that it would
be helpful if the Utilities were directed to consider ways and means by which
customer contact with Aboriginal communities could be enhanced and improved.
The First Nations stated that it might be necessary to consider several
different approaches in order to have effective instruments in place to
achieve consultation with Aboriginal constituents at the customer level.
The First Nations submitted that the area
of deposits on new accounts is one where policies applied to other customers
create difficulty with respect to First Nations customers. One of the
characteristics of portions of the First Nations constituency is that it is
highly transitory. For example, a particular house may change hands five or
six times in a four or five month period and each time a deposit is required.
The rate at which deposits find their way back to the bands is slow. The First
Nations suggested that some alternative arrangements backstopped by the band
might facilitate this situation. This could be negotiated between the utility
and the bands and be appended to the Terms and Conditions of Service.
Position of TransAlta
TransAlta recognized that its relationship
with aboriginal communities is very important, and as a result, has made a
conscious and deliberate effort to improve relationships with aboriginal
communities and strives to create relationships that are mutually beneficial.
For example, the Generation business unit made the commitment to have all
employees attend Aboriginal Awareness Workshops in 1998. TransAlta noted
details of employment opportunities for members of aboriginal communities
within TransAlta, including the creation of an apprenticeship program in the
area of mechanical maintenance and ongoing contractual relations with, for
example, members of the Paul Band. In addition, TransAlta supported the
creation of an Aboriginal Council for employees within the power stations and
TransAlta meets with the Paul Band Liaison Committee on a quarterly basis in
order to address issues arising from the ongoing relationship between
TransAlta and the aboriginal communities.
TransAlta stated that similar initiatives
were undertaken in the Transmission and Distribution business units. TransAlta
employs some linemen from aboriginal communities and actively recruits
aboriginal students from universities across the country for employment.
TransAlta identified specific employees as being responsible for maintaining
and building relationships with Indian Bands and Reserves. During the time
that the Call Centre was being constructed, a conscious effort was made to
have aboriginal representation included amongst the employees at the Call
Centre.
In response to the argument of the First
Nations, TransAlta submitted that several matters raised, such as issues
relating to income tax and customer deposits, are rate issues which are more
appropriately addressed in the context of a Phase II proceeding.
TransAlta submitted that the steps it has
taken demonstrates that TransAlta has already made considerable efforts to
consult with the Aboriginal community regarding a number of issues and
continues to proactively cooperate with First Nations groups. Accordingly,
TransAlta submitted that there is no need for the various directions sought by
the First Nations.
Board Findings
The Board notes with approval that the
Utilities indicated willingness to meet with representatives of the First
Nations to discuss some of the issues that were raised during the hearing. The
Board considers that this is likely the most appropriate and effective manner
of dealing with many of the issues raised by the First Nations such as
employment opportunities, use of Band offices as agents and sustainable
development projects on First Nation lands.
The Board also notes that the Utilities’ Terms and Conditions of
Service set standards that must be met by the Utilities. The Utilities have
the ability to apply these rules more liberally and often do provided there is
no detrimental effect on other customers. It is not the purpose of the Terms
and Conditions of Service to cover all possibilities and eventualities, as
this is not practicable.
The Board also notes that Utilities do not
maintain their asset accounts to facilitate the potential purchase of utility
property. The Board considers that it would be a costly process to alter the
Utility asset system of accounts so that all property on First Nations land
could be separated from other assets. Accordingly, the Board does not accept
this proposal of the First Nations.
The Board notes that income tax is a cost incurred by Utilities to provide utility service to their customers. Therefore it is appropriate that income tax is allowed to be recovered through customer rates. To the extent that a utility is not exempt from paying income tax to serve Aboriginal customers, it is reasonable that the utility be allowed to collect income tax through its rates from those customers.