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An important part of settling land claims is ensuring that fair consideration is given to issues of concern to local communities. A settlement results in new relationships among neighbouring communities and governments, which are built upon commitments made through consultation and dialogue.

When a First Nation proposes that the Government of Canada grant reserve status to land either as a new reserve or as an addition to an existing reserve, Canada's Additions to Reserve (ATR) policy requires that the First Nation approach the appropriate municipal government to identify its views and concerns. The First Nation is expected to negotiate in good faith to address any reasonable municipal concerns.

Some examples of areas which may be of concern to a municipal government are:

• measures to compensate for the municipality's loss of tax revenue once the land attains reserve status;
• arrangements for the provision of and payment for municipal services;
• by-law application and enforcement on the reserve (First Nation by-laws which relate to activities which may affect neighbouring municipal lands or residents should be consistent with the municipality's by-laws); and
• a joint consultative process for matters of mutual concern (such as land use planning) and a dispute resolution mechanism, where possible.

Agreements reached between a municipality and a First Nation can be as simple or comprehensive as those parties feel is necessary. Either the municipality or the First Nation can request a formal agreement. If this is the case, a reserve will not normally be established until an agreement has been reached. The exceptions where a proposal may proceed are detailed in the Additions to Reserve policy.

Canada believes that consultations between a First Nation and a municipal government are vital to ensure that the legitimate concerns of a First Nation community and of its neighbours are met. For instance, the development of service agreements between First Nation and municipal governments can be mutually advantageous, lead to efficiencies, and reinforce mutual respect and cooperation. Such agreements may include arrangements for the provision of and reasonable payment for services such as fire, ambulance and police protection, water, hydro, road maintenance, and snow plowing. The First Nation's core funding to reimburse the municipality for these services is to be arranged by the First Nation with the federal and provincial governments.

The Department of Indian Affairs and Northern Development (DIAND) encourages First Nations to proceed with consultations on Additions to Reserve in an efficient manner and to minimize the time and financial resources expended by the First Nation and the other parties in the process. For example, a First Nation has the option of grouping parcels of land to be discussed, rather than proceeding with individual proposals.

DIAND actively encourages dialogue between First Nations and municipalities to resolve issues of mutual concern. When First Nation and municipal representatives enter into consultations in a spirit of good faith, respect and fairness, it is possible that the time and money expended by all parties can be minimized.

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