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POFO - Standing Committee

Fisheries and Oceans


Proceedings of the Standing Senate Committee on 
Fisheries and Oceans

Issue 9 - Evidence - May 27, 2014 - Evening sitting

GANDER, Newfoundland and Labrador, Tuesday, May 27, 2014

The Standing Senate Committee on Fisheries and Oceans met this day, at 7:07 p.m., to study the regulation of aquaculture, current challenges and future prospects for the industry in Canada.

Senator Fabian Manning (Chair) in the chair.

The Chair: I am pleased to welcome you here this evening to the meeting of the Standing Senate Committee of Fisheries and Oceans. My name is Fabian Manning. I'm a senator for Newfoundland and Labrador and I'm chair of this committee.

Before I give the floor to our witnesses, I would ask that the senators introduce themselves for the final time today.

Senator Munson: Good evening; Senator Jim Munson from Ontario.

Senator Lovelace Nicholas: Senator Lovelace from New Brunswick.

Senator Poirier: Senator Rose-May Poirier from New Brunswick.

Senator McInnis: Senator Tom McInnis from Nova Scotia.

Senator Raine: Senator Nancy Greene Raine from B.C.

Senator Wells: Senator David Wells from Newfoundland and Labrador.

The Chair: Thank you, senators.

The committee is continuing its special study on the regulation of aquaculture, its current challenges and future prospects for the industry here in Canada. This evening we are pleased to welcome Mr. Shayne McDonald, a lawyer and director of Justice for the Miawpukek First Nation and Clyde Collier, Aquaculture Management Consultant with Collier Aqua Service Ltd.

I'm not sure if you were here earlier today, gentlemen. I think Mr. Collier was, so the process is that we give you an opportunity to have some opening remarks, to tell us about yourselves and your interest in aquaculture. We then open the floor for questions from our senators and we have an opportunity to have some discussion. I don't like calling it a debate because it's more of a discussion here around the table, and so whoever wants to take the podium first.

Clyde Collier, Aquaculture Management Consultant, Collier Aqua Service Ltd.: I can go first if you don't mind.

The Chair: Okay, go ahead.

Mr. Collier: I work as an aquaculture consultant. My principal client at the moment is a company by the name of Gray Aqua Group Limited, and they have their administrative office for Newfoundland located in Conne River on the reservation there. What I do for the Grays is I provide management assistance on their salmon farm.

I've got a degree in biology from Memorial University and I guess for the first five years of my life I worked as a foreign fisheries observer and then in the last 28 years I've been working the aquaculture file.

I'm also a member of the Miawpukek First Nations, on my mother's side. My father's side is shining true. So in terms of a First Nations' perspective on aquaculture, what I would like to do is run through a history of what the band has been involved in with aquaculture over the last little while.

Obviously aquaculture is a rural endeavour in Newfoundland and it is basically taking place on the doorstep of Conne River. It represents an enormous opportunity to provide wealth and social benefits to the community and the band has tried at every opportunity to participate in the industry. Despite the effort, their current involvement in the industry is still much less than it should be.

In the early years, the First Nations in Conne River attempted direct involvement. They had their own company growing trout, but they ran into the same kind of husbandry issues that everyone did at the time, having to learn about disease and managing disease in terms of vaccinating their fish. It eventually got solved, but not before it caused a lot of economic damage to the company and plus there were issues at the time getting access to the proper stocks to grow. That as well got resolved in the late 1990s, but there were some negative impacts to the company from trying to grow the wrong fish.

There were also some difficulties. It was pioneering days, so they were having to learn how to farm a very unique environment in Newfoundland in dealing with ice and those types of things — coastal ice, not Arctic ice.

I guess around 2000, the fish that they were producing were for the market in Japan and the Japanese economy went into a full recession.

The company survived that year and then in the following year, 2001, the planes flew into the towers in New York and the market crashed again. So it was two years in a row when the company was trying to sell below market prices, and it was just too hot in the kitchen; they had to get out. So they sold out their interest in the farm around 2001.

Through early 2000, some band members continued to work in various farms around, but nothing direct from the band in terms of participation in aquaculture. Then around 2009, Gray Aqua Group saw an opportunity in setting up an operation in Newfoundland with administration, maintenance, construction, processing all on reserve and pooling farm staff from the reserve and also off reserve, band members as well.

The Grays in particular, they have sensibilities that would allow them to see the benefit of working with a population that was non-transient where work was concerned and a stable workforce. Tim Gray, the President of Gray Aqua Group, he's married to Michelle. She's Maliseet and all six of his children are members of the Woodstock First Nation.

The early promise that this would be a turning point in terms of the participation of the Conne River Band in the aquaculture opportunity of their doorstep did not live up to the very high expectations. There were some difficulties that arose early with the training program geared to prepare Miawpukek First Nation members for work with the farm. Many of the trainees only experience was with band social programs and make-work projects. They just weren't prepared for the intensity of farm work and retaining those individuals was a problem for the farm.

In 2011, MFN and the Grays attempted a joint venture in terms of trying to establish a processing plant on the reserve, and that fell through when the issue of land on the reserve became a problem. It became apparent in the development of the business plan that the reserve land could not be leveraged. In their haste to have a place to process their project, the Grays broke from the joint venture and built a processing plant in Hermitage instead and that sent what would have been an economic anchor, no matter who owned it, down the road from the reserve.

So in the two more recent years, the Grays have been hit very hard by ISA. There's been a lot of talk today about the number of ISA cases in Newfoundland. Those cases are all identified by company and sites, but in reality, there have been only two ISA outbreaks of particular strains. There was a strain in Butter Cove and then a strain at Pot Harbour. The one at Pot Harbour then went to Goblin Bay, to Pass My Can to Sugarloaf. It just spread, so that was the same outbreak. It gets quoted as being five; it was actually one outbreak just spreading. Anyway, the Grays were heavily impacted by that.

Another thing that got spoken to today was about the levels of compensation and that the farms break even on this. They don't. They get compensated but for the Grays, it put them into bankruptcy protection. They were in bankruptcy protection all through last fall. They managed to come out of bankruptcy protection early this winter and they found new financiers to be able to move on.

Essentially what happened was with the disease and with the amount of compensation that they did receive, it frightened the bank that they were involved with. The bank said, "We want out," and they backed away. They were prepared to walk away no matter what, so they just walked away from the farm. Having the bank walk away was enough to allow the Grays to survive and find someone else to finance the farm. That also obviously had an impact on the Gray's relationship with the band. Part of the bankruptcy protection saw receivables that the band had with the Grays. They were dismissed by the court, so they only received a portion of their receivables, maybe what? Six per cent, and you're still waiting on that?

Shayne McDonald, Lawyer and Director of Justice, Miawpukek First Nation: Yes.

Mr. Collier: Since then, the Grays, with their new financing, and how Newfoundland is now preparing to manage ISA with these bay management regions, is forcing the farms or causing the farms to move farther afield. They're moving farther down the coast and separating more from each other and having more regimented stocking regimes. That movement down the coast farther away from the reserve, a lot of band members don't want to move that far from the community, and so again it's caused a retention problem. That's basically the history, but I will add to that.

Since that market crash in price in 2000 and 2001, the market has been fairly steady in coming back. The prices have been very strong. There's been a 10-year run and the band is now giving some consideration to more direct participation themselves in aquaculture.

I really wanted to give you that history because it's a bit of a brutal thing, but hidden in all of that are a number of fundamental issues and problems that need to be considered. One of the major ones in terms of the band is how they finance themselves or how they finance a fish farm. They depend entirely on taking money from their social transfer as their initial investment and that social transfer is meant for other things. It's meant for housing, for municipal affairs, schooling, health, all of those things. They don't really have the means of that first investment, the leveraging that's needed for a farm. Farms are very capital intensive places. They need a lot of money.

Just to speak to that a little bit, the band or the administration in Conne River, the community is one of the best run native communities in Canada. It is top notch, but still with that investment in aquaculture that they did in 2000 and the failure of price in the market for those two years put them to the wall. They almost went into third party management because of that. For the chief and council, I guess they're very cognizant of the deficits inherent in the trap they're in with regard to employment on reserve. I'm trying to speak now to the issue of that retention problem that the Grays had and the effects of make-work projects and being forced to do social employment.

The reserve itself doesn't have any natural resources. These are small parcels of land and this is precisely why the reserve is there. We didn't put them on reserves because they were good places in terms of an economic opportunity. So the dilemma that the chief and council face is how to maintain that community with no natural resources and perceived penalties of working off a reserve.

If band members decide that they're going to take a job off the reserve, they will lose any tax gain. If they work on the reserve, they don't pay federal income tax or provincial income tax, but if they step away from that, then they will. So that's a disincentive for them to work off the reserve, plus the whole issue of it being a very unique culture and they just don't want to move from the community.

On the south coast the only community that's growing in population is Conne River, on the reserve. So what chief and council have done is they've taken what maintenance work they have and they will divvy it up so that they basically stamp up the ones that need to get unemployment insurance for the year, and that's created a work pattern and a work expectation that can be very problematic.

This system also taps out the band's monetary resources. Within that social transfer, every year the band reaches the limit and has no ability to expand that policy as a growing community, so they're up against the wall. They cannot continue to do that.

And land: You can't do any business anywhere in Canada if you can't leverage the land. If you can't put a building up and take it to a bank somewhere, it just doesn't work, so that's a huge issue.

If bands are going to participate, they need to be able to somehow leverage their land. I don't know how this can be done. I have no idea, but perhaps what needs to happen is Indian Affairs needs to stand behind some of these loans so that if somebody does go sideways, then the federal land is still protected.

In terms of a conclusion, what I want to say is that First Nations need to be given every opportunity to succeed in business and chiefs and councils need to have the tools to provide for their respective communities. It's just not about the business of aquaculture, but any kind of business. The economics of trying to run a very resource poor reservation and the federal transfer is not a vehicle for investment in business. It's about day-to-day care of the community, and even that needs to be brought on par so that reserve members have social parity with the rest of Canadians and are not belittled for receiving the meagre allotment that they receive.

Underfunding is also undermining the basic social health of the community and has many negative social implications. An investment vehicle needs to be put in place so that First Nations have the investment funds required to participate in business instead of being forced to tap into already unfunded social transfers. A means to remove the disincentive to working off reserve must be found. It would allow First Nations to maintain their tax free status when they work off reserve or for off-reserve entities. It would probably be cheaper for Canada than it would be using the current incentives towards employment insurance and welfare and would give further incentive to reserves to invest off reserve where there might be resources for a business. First Nations people need to have parity with other Canadians and the ability to hold a mortgage and allow property to be developed without prejudice from the banks; that needs to happen.

That's my written brief, but I've been thinking about some other things today and if you don't mind, I'd like to add to it. Is it okay if I'm not running over time?

The Chair: Your time is okay; go ahead.

Mr. Collier: There was some discussion today about Omega 3s and salmon, and I think it was you asking that question. The Grays have done a lot of work on Omega 3s with their salmon. They've used some algae ingredients in their feed to help boost Omega 3 levels. Typically wild Atlantic salmon will have around 300 milligrams of Omega 3s per about 100 grams of flesh, so basically one portion. Typical farm fish would run around 2,000 milligrams and by using the algae in the feed, they were able to boost the Omega 3 levels up to around 4,000, so nearly double even what you would find in wild fish. They've been working also with the Marine Institute on that, so we're working on methods of extracting those oils from the waste so that we basically add another product to the mix.

If you look at the value of Omega 3s in that waste product, it nearly doubles the value of the salmon itself, so it was a very important question that you asked about fish farms in Canada. You really need to focus in on that one; it's a very important thing.

There was a question on siting. I can't speak to what happens in other provinces, but here in Newfoundland, how we're directed and how we manage that, with DFO and DFA, we cannot site a farm in anything less than 30 meters. That's not the area where the lobsters are. Lobsters are much shallower than that, so the farms are positioned much deeper.

There was a question about COSEWIC and aquaculture. I've read that COSEWIC report. It speaks about the impacts of aquaculture on the rivers along the south coast. It says that the effects of aquaculture are unknown. It doesn't say it has an effect; it says the effects are unknown.

There was a discussion about the rivers that are impacted along the south coast. They range from the Paradise River in Placentia Bay all the way west to Grey River, including the Conne River and the Little River. Almost all of those rivers within that system follow that same return rate, irrespective of the presence of aquaculture. The levels of returns in the Conne River were significantly declined to the levels even that we see today before there was any aquaculture in the area. Since aquaculture has established itself within the area, actually the returns have gotten better.

There was some discussion that there weren't any scientific reports by DFO in the area. There's an established fence on the Conne River that's managed full time by both the band and DFO. There was a scientific report in 2006 authored by Brian Dempson and it speaks to the returns of Atlantic salmon in all of Newfoundland, including the Conne River and other areas. One of the conclusions it made about the Conne River is that the impacts from aquaculture were not seen. It doesn't mean they weren't there, just that they weren't about to see it.

There was also some suggestion about the salmon farms at the mouth of the Conne River. The Grays have some of the closest salmon farms to the Conne River. The closest one would be at Butter Cove. It would be close to 30 kilometers from the mouth of the Conne River. There are lots of trout farms that are closer, but no salmon farms. There are no salmon farms anywhere near the Conne River. That's not to say that fish that swim out in those rivers don't go by fish farms; they do have to pass by those farms on their way to the ocean.

With the moratorium, most of the available real estate in the water in Newfoundland that could be used for growing fish has already been licensed or is part of a licensing system. If there was a call today to license no more sites, it wouldn't have any impact on companies themselves and how they could or couldn't expand. The area is already licensed, so that's — anyway, it's impossible.

And there was some discussion about processing and the movement of companies that somehow was related to productivity as a part of the Grays or whatever. We've just formed an agreement with Cooke Aquaculture and we're going to be processing together out of Hermitage, so that's more about the politics of the area and manoeuvring by companies and farms for space and for processing capability closer to their farms. That's all that was about in terms of Cooke leaving Harbour Breton and Northern Harvest and Barry Group starting to process out of Harbour Breton.

In terms of outfitting in the south coast, in that particular area where fish farming is taking place, there are two outfitters. I've got one company; Shayne's got the other one. My clients are all from the aquaculture industry, so without the aquaculture industry, I would have no clients for my outfitting business.

That's it, I'm done.

The Chair: That's a pretty good way to end.

Mr. McDonald.

Mr. McDonald: First, I'd like to thank the Standing Senate Committee on Fisheries and Oceans for inviting myself to make presentation today. Second, I'd like to pass on the regrets of Chief Mi'sel Joe, to whom the invitation was extended in the first instance. Unfortunately his schedule precludes his presence and presentation here today.

My name is Shayne McDonald and I am the Director of Justice and Legal Affairs for the Miawpukek First Nation. Like Clyde, I am a member of the Miawpukek First Nation. I grew up at Conne River, attended the secondary school there. Upon graduation attended Memorial University and upon grading from Memorial University with a B.C., I attended law school at UBC, graduated in 1993, got called to the bar in 1994 and have been the band's Director of Justice and Legal Affairs since that time.

I'm going to supplement Clyde's synopsis or history of the band's involvement in aquaculture and speak about the economic opportunity we see in aquaculture. From there, I'm going to speak about the environmental issues or concerns that we see inherent in the industry, and I'll end my discussion with a little commentary on the prospects of federal legislation regarding aquaculture.

In terms of Miawpukek First Nation or my community, a bit of background. The community is located at Conne River, situated on the banks of a river by that name. The emergence of Conne River as a community is not fully known in terms of time or temple span, but I guess the historians tend to agree that it emerged in the 1800s as a permanent settlement; whereas before that, it was a seasonal settlement and the traditional economy of the community was basically hunting and trapping.

The heads of households had the interior carved up into family hunting and trapping grounds in which there was subsistent hunting commercial fur trapping, and as well, guiding of sports persons to the interior. Our economy was much the same as the outport communities, only a different focus. In outport communities, there was seasonal fishing in which fish was brought to market to pay off a line of credit with the merchants and on a seasonal basis. Our economy is pretty much the same.

After Confederation, in around the 1960s, the fur trade totally collapsed and so did our traditional economy. Up until the late 1970s our community was basically in poverty and starting to erode in terms of the community's cultural identify, inactivity, very much welfare dependent. Newfoundland and Labrador, unlike the rest of Canada, when it joined Confederation the responsibility for Aboriginal peoples wasn't fully assumed by the federal government. So in the 1970s, as part of the pan-Canadian Aboriginal movement and identity, our community advocated for the recognition that was afforded groups in other parts of Canada and in 1984 we were successful in receiving status recognition. So we came under the Indian Act a little bit late, but coming under the Indian Act gave us community programs for education, post-secondary schooling and infrastructure which made a difference in the community's prosperity.

In managing those programs well, we created opportunities in the community and enabled the younger generation, which in the 1980s included myself, to become trained and educated and to add to the company's capacity building and growth. From that time on, the band identified, as it developed governance and capacity, the need to develop an economy.

We had a combination of success and failures. We developed outfitting lodges that successfully provided services to American big game hunters. We developed commercial fishing in the late 1990s that was relatively successful, although it has the ups and downs that are inherent in the commercial fishery and other small businesses in the community.

As Clyde indicated, the band is well managed. In terms of our revenue base, it's a combination of the grant funding from Aboriginal Affairs and Health Canada. Those programs are well managed; the band is very transparent and accountable. As well, we get some self-generated revenue from our business units.

But the band doesn't have a significant resource base or major industry that is going to put it into the realm of being independent, to break the cycle of dependency on the federal grants. That's a constant challenge and something that we yearly, as part of our strategic planning process, work to achieve.

In the late 1980s, 1990s, we identified aquaculture and occupied that field in two particular ways. One, we had our wholly owned aquaculture company which grew rainbow trout and was owned entirely by the Miawpukek First Nation; and, two, we invested in SCB Fisheries which, at the time, was the largest finfish grower in Newfoundland and Labrador and we became the majority shareholder. We were able to do that through wise management of our money in which we came up with the investment dollars to purchase the shares.

So for a short time in Newfoundland history we were probably one of the biggest proponents of aquaculture through our shares in SCB Fisheries and our wholly owned company. But as Clyde indicated, the industry at that time was in a pioneering stage or a growth stage, and it had various up and downs. I guess the saturation of the market with Chilean fish saw that the inventory that we had at the time was pretty much not worth what we had it on paper as being worth.

The unfortunate thing was that we funded that grow-out through programs that came into the community for the school, for public works, for housing. It was a big mistake. But at the time we didn't realize that, wait a minute, you got this fish in the water and you're thinking it's going to go to market for this price, but if it doesn't, your entire community programming is going to be at jeopardy.

As Clyde indicated, that was a big blow when the market collapsed, so we did two things: We divested of aquaculture, our assets; and, second, we didn't go into third party management with Indian and Northern Affairs, as they were referred to at the time. We indicated to them that we have a situation, we're in trouble, but we have a plan to get ourselves out of it and we don't want to go into third party management.

That side of the community making drastic measures, administrative staff took a layoff, worked year round but only seasonally received remuneration. Sacrifices were made in a number of areas. Programs were tightened up and got super-efficient, and we took out a five-year loan to get us out of the multi-million dollar debt. Within three years, we burnt the loan papers for that debt and vowed never again to go down that road. That speaks to an issue regarding the capital requirement to enter aquaculture, which I'll speak a little bit more to later.

After that debacle, if you will, the band vowed not to go down the aquaculture ownership road, but at the same time we did recognize that aquaculture continued to grow in the Coast of Bays Region and continued to be a significant economic driver. So our strategy changed from being aquaculture farmers to creating an environment within the Miawpukek First Nation that's conducive to aquaculture companies positioning themselves and doing business, whether it be buying from our building supply store, utilizing our human resource pool of individuals, many of whom were trained as aquaculture technicians or commercial divers, or utilizing our fishing vessels for towing cages or towing feed. We figured we could benefit from the spin-off opportunities through employment and other opportunities that didn't have the same risk.

As the aquaculture industry grew from 2001 up to the present, we did benefit from these spin-off opportunities, but the reality has been those benefits have not been to the agree that we anticipated and that's because of several reasons. Some of the opportunities, the bigger ones, still require large capital investment, but more particularly the aquaculture companies tend to be vertically integrated, meaning they take care of all their industry needs. They do their own diving and tow their own cages, so the spin-offs didn't come to the degree that we anticipated. As we realized the aquaculture companies were taking a vertically integrated model, we came to realize that they're all trying to mimic Irving Oil in terms of their vertical integration.

So that saw us around two years ago thinking, well, if we're not getting the impact of the spin-off opportunities that we anticipated, maybe we have been gun shy for over a decade about entering aquaculture — the old adage "a person scorned," So we figured, maybe we should open our eyes a bit more. Maybe now that aquaculture has grown to a stage where it's at full commercialization, there may be opportunity to re-enter as farmers and grow fish.

So we did a feasibility study and business plan for a trout farm operation, and it was completed last year. It speaks positively to the prospects of successfully entering in aquaculture and creating revenue generation and employment for band members, but also speaks to the need for a sizeable investment. As Clyde indicated, the community's revenue is based on program funds and accommodations of business units. Our commercial fishing revenue potentially gives us revenue to re-invest in aquaculture, and we recognize the need to diversify our fishery, so aquaculture may be a means to diversification. But at the same time, the total amount of capital that's required to enter the fishery, as indicated in our business plan, remains a significant barrier. To that end we're working with various agencies that are mandated to assist Aboriginal communities with economic development, like Aboriginal Business Canada, the Ulnooweg Development Group and to date discussions are still ongoing.

As I indicated in my discussion notes, in 2011 we collaborated and participated in a national action plan for Aboriginal aquaculture development through provincial meetings that took place in Newfoundland that was carried out by the Ulnooweg Development Group on behalf of Fisheries and Oceans Canada. That discussion took place across Atlantic Canada and from my understanding out in Western Canada. It sought to get an appreciation of the Aboriginal community's interest and potential impact of aquaculture. So we participated in it, and the thought at the time was that this consultation and discussion would potentially lead into a federal program that would be specifically designed to help First Nations enter aquaculture.

DFO had a program at the time known as Aquaculture Innovation and Market Access Program or AIMAP program, which focused on catalyzing aquaculture industry investment from the private sector that would improve the competitiveness of Canada's aquaculture through innovation. So we thought that this discussion and consultation would lead to an Aboriginal focus program along those lines, but unfortunately that didn't materialize. As well, the AIMAP program, which we would have been potentially eligible to apply to, was discontinued by the federal government.

What did come out was a program that's known as the Aboriginal Aquaculture in Canada Initiative. That program came out around a year ago. It is federally funded through DFO, I think, but that program offers technical assistance and business plan assistance. They did help us with our business plan, in part, and it was very helpful in that respect, but that program doesn't have the funds or the resources to help with the capitalization.

I guess our message in terms of the opportunities for aquaculture and how they can positively impact an Aboriginal community is that for some Aboriginal communities, like ours, which are directly in the centre of the aquaculture region in Newfoundland, being the Coast of Bays, it has the potential to be a significant economic driver in our community. Our experience in the past has been mixed. We've seen the benefits of it, of the employment for band members, of participation, and we've also seen the negative when markets go afoul or farms become insolvent and what that could mean for any investment that you had in those companies.

Nonetheless, we still think the future is bright as the industry continues to grow and as production ramps up and the bay management system comes into play. We're going to continue to research and to forward on our business plan and to seek ways in which we can fund that opportunity. Our message is that if the federal government, through its various programs and future programs, can provide a specific program to assist Aboriginal communities directly, it would be very beneficial to the communities and to Canada and Newfoundland as a whole if something like that was in place.

The last issue I'm going to speak to the environmental issue. Over the last couple of years, the vocal opposition to aquaculture in terms of what's happening to the environment has increased somewhat. Conne River has been one of the more vocal groups. At times that's perceived as the band or the First Nation is opposed to aquaculture, but that's not the case. We're supportive of aquaculture in an environmentally friendly and sustainable way, but some of the things that we're witnessing include marine debris in the Coast of Bays Region, which is impacting other groups such as recreational boaters. Once pristine beaches are marred with aquaculture debris, feed bags, pieces of cages and ropes. Recreational boaters are hitting pieces of floating cages. We've been vocal in indicating to the industry association that this is out there.

Not only have we been vocal, we've been putting our resources where our mouth is. Annually we participate in a beach cleanup, which is not a one-day event. We have marine technicians that are out in the bay and they dedicated a fair bit of time of bringing in debris from aquaculture. We document it and we let the association know.

Other concerns include fish waste, disease and the escapement of farm salmon into the wild.

In terms of escapement of farm salmon into the wild, we're particularly concerned with that one as in other parts of Canada, like British Columbia and New Brunswick and other parts of the world, there's been documentation of salmon of aquaculture origins spawning in the rivers. With our area, the Conne River and the Little River, which is adjacent to our community, salmon returns in those rivers are very important to our community from a food, social and ceremonial point of view, and it's probably the reason why we settled there. As such, although on the one hand the industry can say there's no empirical evidence that aquaculture has impacted your salmon, what we do know is that the salmon returns have declined over the years as aquaculture production has gone up. That doesn't mean that there's a nexus.

We also know that there are escapees. In 2013, aquaculture-escaped salmon were found in both Little River, Conne River and the Garnish River. Our fear is that if they spawn or interbreed with the wild salmon, and I think it's been documented in other parts of the world that the hybrid salmon may be less prone to survive in the wild, which might be detrimental to our rivers in that the returns are already low and the rivers are barely meeting our seed requirement.

So what we like to do in presenting those environmental issues is not to put forward that aquaculture shouldn't be there because of those issues. We put forward that aquaculture and other stakeholders, like the province, like the federal government and the First Nation, need to collaborate and do further research and development to determine the precise impact of those escapements and to work towards addressing those other environmental issues.

To that end, in 2014 we're working with DFO's Science Branch in doing a telemetry study that would track the movements of escaped salmon in the river, to follow their pattern of movement and interaction so that we can better understand their impact on the wild salmon. We're able to participate with DFO through funding that we received through National AAROM body, which is funded through DFO. Resources through other stakeholders that could continue with that type of work will enable us to better understand the impact and mitigate any potential threats.

I want to end off on a note as it relates to the entire gist of the Senate committee's mandate or terms of reference as I understand it, that being the research into a federal regulation involving aquaculture. Our First Nation has followed the developments in British Columbia in a case of Morton v. British Columbia. We strongly feel that an overarching or pan-Canadian federal legislation is very much warranted for a number of reasons. One, we think that the Department of Fisheries and Oceans acting under specific legislation can add resources and capacities to ensure that regulation has teeth and meaningful enforcement. Two, we think that pan-Canadian legislation is a better model than a patchwork piece whereby legislation is in place in the Pacific but not in Atlantic Canada.

That being said, that ends my presentation.

The Chair: I want to thank the both of you. You have covered a lot of ground and I'm sure you've answered some of the questions that our senators already had, but there are some senators who would like to ask questions, and I want to begin with Senator Wells.

Senator Wells: Thank you Mr. Collier and Mr. McDonald. You sure did cover a lot of ground. I'm looking at my very first question and it seems so unimportant now given what you've said.

For my own clarification, because I don't know how it works with the Miawpukek First Nation, when you say "working off reserve" and you don't gain the benefits of being on reserve, does that include living on reserve and working in Harbour Breton? Can you help me with that?

Mr. McDonald: What Clyde alluded to is having your income tax exempt is certainly a big benefit. Individuals living on a reserve have enjoyed that throughout most of their working life. They tend to want to continue that tax exemption status. But Canada Revenue Agency guidelines, as well as the court cases that provide guidance, indicate that there has to be substantial connection to the reserve for an individual to enjoy a tax exemption.

Typically there are three connecting factors: live on reserve, work on reserve and employer on reserve. To enjoy a tax exemption that individual needs at least two of those connecting factors. So if they live at Conne River and work at Harbour Breton, but the company that's employing them to work at Harbour Breton is situated on reserve, then they would have the tax exemption. If they live at Harbour Breton as a status Indian but they work at Conne River and they are paid by an aquaculture company at Conne River, they would have two out of three connection factors.

We find, amongst our membership, increasingly amongst the younger generation, that there is more of an affinity to work elsewhere, but, for lack of better terminology, there're going for the "big bucks." They're going to Voisey Bay, Muskrat Falls and Alberta. They've trained as millwrights, steelworkers, heavy equipment operators, so the tax exemption is not a big factor with them because of the magnitude of what they're earning.

Senator Wells: Right.

Mr. McDonald: But for technical people or labourers or divers in the aquaculture industry, you are around $12, $15 an hour and the tax exemption is a big benefit that they would like to retain while working in Newfoundland.

Senator Wells: Are there many from Conne River and the Miawpukek Band that enjoy that exemption and work in the aquaculture industry, because obviously there's not aquaculture industry within Conne River.

Mr. McDonald: There are many that can. With Gray Aquaculture, it probably manifests itself to the highest degree because they were physically situated in Conne River, although their operations saw the workers working in Hermitage Bay and Bay D'Espoir, off reserve. The fact that the members lived at Conne River, worked with Gray Aquaculture off reserve in the bay area, they enjoyed that tax exemption.

Senator Wells: Okay, I got it. I didn't know that. That's good to know and it's interesting because it ties in with the work opportunities that the people in your band have.

We heard from Mayor LeRoux and Mayor Drake from St. Alban's and Harbour Breton today. They talked about the cooperative arrangements that they have among the many communities in the region. Are you part of that community as well, or do you see yourselves as the Conne River Band, separate?

Mr. McDonald: No, I think our community is part of the joint mayors and a recent MOU to move forward jointly in terms of regional prosperity and initiatives. We're part of that and probably one of the driving forces, and that's been a change.

In the 1980s, early 1990s, we were very much isolationist; you know, "We are going to make this happen ourselves and this is going to be self-contained." Just as no man is an island, no community is an island. We soon realized that working as a region — partnering with other companies, joint ventures, collaboration — yields better benefits and a better chance of success.

Senator Wells: Sure. If you isolate yourself, you do it at your own peril.

Mr. McDonald: Yes. As Senator McInnis indicated in our informal discussion before the proceeding started, a sister First Nation Atlantic Canada, Membertou First Nation, which we have pretty close ties with, they probably emerged as a role model in Atlantic Canada in terms of the success that can be enjoyed by partnering and developing your economy through expanding outside the reserve boundaries, and so we're looking to follow suit.

Senator Wells: You talked a little bit, Mr. McDonald, about taking from the band's social programs and using it for investment in business opportunities. I don't know if that's exactly the wording, but I think that's the intent of what you said or certainly what I thought I heard.

Mr. McDonald: I should explain that that wasn't exactly how it unfolded because our grant funding with Aboriginal Affairs Canada gives us great flexibility. We can spend surplus based on needs identified by the community, but we didn't say, "Well, we're going to spend education funds on aquaculture." But in cash flowing aquaculture during the grow-out stage, we used the band's cash flow in our financial institution.

Senator Wells: You risk-managed the money; I understand.

Whenever a business person makes an investment, they take money from somewhere to use it in that venture. Is there an aversion within the band to do that?

Mr. McDonald: For aquaculture, given our history, there is an aversion, yes. Outside of the issue of band revenue earmarked for programs and services, for band-generated own-source revenue from commercial fishing and outfitting, the band has indicated a willingness to contribute a portion of that towards aquaculture, but not to the degree that's probably needed to fully make aquaculture a reality.

Senator Wells: Because you must see the success of aquaculture all around you and the opportunities that other communities and companies are taking and benefiting from to fund social programs or whatever they fund. Is there any internal conflict there?

Mr. McDonald: There's discussion and dialogue. I would call it an internal conflict, not unhealthy. Conflict in and of itself is not a bad thing; there is discussion and dialogue. But I think the community is at the stage where it wants to enter aquaculture, wants to do it the right way, is prepared to invest own-source revenues, but the level of the investment, given our resources and the level of risk we're prepared to take, probably falls a bit short of what is required to successfully enter aquaculture.

Senator Wells: Okay, thanks very much.

Senator Lovelace Nicholas: Welcome.

Mr. Collier mentioned that you had a program with Gray or started aquaculture with Gray.

Mr. Collier: Yes.

Senator Lovelace Nicholas: Did you try to partner up and enter into partnerships with other aquaculture farms?

Mr. Collier: We have already with Cooke Aquaculture out of our processing plant in Hermitage; we're partnering with Cooke there. Also from what I understand, the headquarters in Woodstock, New Brunswick, we have a large hatchery there. We're participating with Cooke there as well in terms of production of smolts.

Senator Lovelace Nicholas: Do you have access to government grants, the same grants as non-Natives?

Mr. Collier: Yes, we do have access to the same grants as non-Aboriginal proponents of aquaculture, but those grants are few and far between. Most of the programs are loan guarantees to access funds from financial institutions. The grants that are out there are specific for Aboriginal communities, like Aboriginal Business Canada or the Economic Opportunity Fund administered by AANDC, they're capped in terms of the level of funding they can assist with, probably far too low for the level of capitalization required for aquaculture, so they're underfunded in that respect.

Senator Lovelace Nicholas: You answered one of the questions that I was going to ask. You have access to training programs in aquaculture for the youth in your First Nation.

Mr. McDonald: That's a good point. One of the benefits or positive aspects that our community has that would be attractive and I think it was attractive to Gray Aqua and other companies is that through our training program — which is funded in two parts, one from Aboriginal Affairs Canada and the other one through Service Canada, the ASETS agreement — we can mobilize fairly quick and do specific training to meet the needs of industries. We have a rapport with the various training institutions that they can easily mobilize for community-based training and we've availed ourselves of that in the past.

Senator Lovelace Nicholas: Thank you.

Senator McInnis: How many are in the Miawpukek Band?

Mr. Collier: We have approximately 900 on reserve. Our total membership is around 2,000, 2,100. The membership that's off reserve, they range from other parts of Newfoundland, like St. Alban's which is in the bay area, St. John's and all over Canada and other parts of the world. But the core community at Conne River, the on-reserved population is approximately 900 members.

Senator McInnis: So your transfer from the federal government would be based on the population that actually lives on the reserve.

Mr. Collier: Correct, yes.

Senator McInnis: I have a number of questions. First of all, because of the Conne River and the decline of wild salmon, have you thought about the effect of acid rain? Acid rain has had a real effect on many rivers, so much so that in fact in my hometown we have — and I think it's the only one in America — a douser where we put lime down. It is in a big tower and it shoots out into these tributaries. We've got the pH down to 5.2. It's something that people should be considering. I'm not trying to eliminate any effect of aquaculture, but I'm telling you that there are a lot of rivers that have really been affected as a result of acid rain, so you should consider that.

Membertou has been extremely successful and Eskasoni is coming along. The Millbrook Power Centre, when all of us drive on the 102 Highway, you see what takes place there. They had to have been able to lever funds from someplace, so is your problem the fact that it's not a large band, and, secondly, is it because of the stigma of your track record?

Mr. McDonald: No, no. In terms of our commercial track record, although aquaculture hurt us in terms of having to come up with a remedial plan, other business units have been well managed, like our outfitting, heavy equipment garage, automotive garage, building supplies, the Miawpukek First Nation is located — some of you were down to the Coast of Bays recently. It's a dead-end road that goes down to the coast, very scenic and picturesque, but if we were on the Trans-Canada or more centrally located or in a bigger service centre, there would be way more opportunities through location.

We have a tourism sector and we run what was once a provincial park. We have boat tours. The Coast of Bays is continually trying to increase the tourism traffic down to the Coast of Bays, but where it's a dead-end, there's no loop. We don't have a national park like up in St. Anthony, so location plays a big factor.

Up until recently Newfoundland was a "have not" province. We're told that the French translation of Bay D'Espoir is "Bay of Hope," but we were basically a "have not" region within a "have not" province. Aquaculture has emerged as one of the prime opportunities, the forestry has declined and the commercial fishery is kind of cyclical, so I think the location has been a big factor.

Those programs that enabled Millbrook to put in the power centre or Membertou to put in their casinos and their hotel, in part they're available to us, Aboriginal Business Canada, AANDC, but in other respects the Marshall funds that came out of the Marshall decision are not available to us. It's a combination of not having access to the full amount that other reserves have had and not being ideally located, and being restricted to the resources and opportunities that are in our particular region.

Senator McInnis: When we were in B.C., we were told that some of the bands have leases. They pick up a lot of spin- off jobs. We went out. A Native was driving his father's boat. They used three different boats to take people back and forth. They picked up all of these spin-off jobs.

You talk about vertical integration, that's one thing, but what rapport and what consultation do you have with those in the industry that they cannot partner to give you a leg up?

Mr. McDonald: In terms of potential partners from outside the community, we have an economic development program that's mandated with identifying potential partners. Grays is one of the partners that dialogue was struck through Clyde in our economic development department and they've established themselves at Conne River. They had a bit of a rough road in the last year or so, but we're hoping as they stabilize so too will the benefits of the community.

The commercial leasing side of it, that's a good point. We've identified leasing land as a potential opportunity. Clyde indicated that a couple of years ago Gray Aqua wanted to build a processing plant on reserve in partnership with Miawpukek First Nation. Where it's federal land, the financing that Gray Aqua had in place could not be utilized if the plant was established on reserve because the financial institution couldn't take an interest in the land as collateral, so that was a major barrier.

The reserves in British Columbia have been very innovative in getting over that hurdle under the Indian Act through designating land. There's a process under the Indian Act where you can designate the land and then you can offer a multi-year lease for up to 99 years so that the proponent can provide security to their financial institutions. So we've undertaken a land designation process. It takes two years from start to finish to enable us to provide a commercial land lease.

As well, the federal government has the First Nations Land Management Act, which allows Indian communities, First Nation communities to come out under the Indian Act administration of land and to put in their own land management code. Under that code you can develop provisions to enter multi-year leases up to 99 years, such that the proponents and outside business interests can take security.

In 2013, two bands were admitted under the First Nations Land Management Act in Atlantic Canada. Every year the federal government only accepts a few bands with a good management track record under that program, and it was ourselves and Membertou that were accepted in Atlantic Canada. So work continues in the community for our First Nations Land Management Act code that would see us coming out under the Indian Act and giving us more flexibility to do some of the things that Clyde spoke about. It's exactly the model that came out of British Columbia.

Senator McInnis: Finally, have I depicted correctly that overall, apart from the cleanups you have to do and so on, that you're supportive of the aquaculture that now exists in Newfoundland.

Mr. McDonald: How would I phrase that? We're supportive of aquaculture. As it now exists we have some concerns with marine debris, the safety of cages with other user groups, escapement of salmon, and fish feed and offal in the environment. Our resolve is to work with industry to see those issues addressed.

We're getting an indication that industry wants to work with us, but it remains to be seen down the road whether or not we get the corporation such that we'll continue to say we support aquaculture. There may very well be a juncture where the band stakes the stance that this is just lip service and the environmental issues prevail such that we don't support it. But as it stands right now, the community is supportive of environmentally sustainable aquaculture.

Senator McInnis: Well, I wish you luck. You sound like you've had a hard blow. You also come across to be very honourable, and so I wish you the best of luck.

Mr. McDonald: Thank you.

Senator Poirier: Thank you for your presentation.

This afternoon we had two mayors from different communities that were here and made a presentation. They talked about the economic development in their communities by the aquaculture business. But it wasn't them doing the aquaculture actually; they had businesses that were building the economy. Help me understand. Is it the First Nation, the band, that looks after the aquaculture, or do you have individual people in your community that are in the aquaculture business?

Mr. McDonald: It's probably twofold, but the biggest proponent or the biggest entity with the mandate to explore the benefits from aquaculture is the First Nation itself, that being the governing body, chief and council, through its economic development department and its economic development corporation. It has a development corporation, as well as a commercial fishing company known as Netukulimk Fisheries. So the band is considered to be the biggest proponent that has the best prospects of entering aquaculture.

We do have some band members that have established businesses that have had a mixed measure of success, such as diving and more recently a band member who is developing his own commercial garage and marine repair.

Senator Poirier: The reason I was going there is I know from the notes I have that in April of this year you received a grant of close to $46,000 from the Atlantic Salmon Conservation Foundation to participate in an Aquaculture Escapee Monitoring Program. You talked about the escapee program a little while ago. I was just trying to understand your involvement because you guys got the grant. With this grant, do you forward the money to a company that does this, that monitors the program, or is it you, as the band council, that monitors the program? How does that work?

Mr. McDonald: Well, it works in a manner that is highly collaborative with the Department of Fisheries and Oceans Science Branch. We have technicians on the Conne River and the Little River, which are two rivers adjacent to the community, which are very important from a full social and ceremonial point of view. Those technicians monitor the river. When they see salmon that may look like an aquaculture escapee — there are some outward physical signs. But DFO takes the approach that a salmon in a river is a salmon in a river, considered a wild salmon, and it's only determined to be an escaped salmon after it's undertaken a process to identify it. They basically take a scale sample and with a microscope observe the scale lines. I'm not 100 per cent familiar with that process. So we'll have technicians in the river that will take those samples, record the time, date, when, GPS location, and provide that data to DFO who will do a mapping of the locations of escaped salmon. So that funding comes into the band and the band engages its natural resource technicians to do that work.

Another program of a similar nature is that we are going to do an orchestrated escape. We're going to work with the industry to let farmed salmon go and have radio tags. From there, in the rivers, we're going to monitor where they go with radio receivers that will monitor the movement of those salmon.

The funding that allows that to take place is the AAROM body, Aboriginal Aquatic Oceans Research Management Program, a DFO program. Our First Nation and the Qalipu Mi'kmaq First Nation on the West Coast are in an AAROM body association. Funding from that program enables us to buy the radio tags and the telemetry equipment that enables us to participate with DFO Science. So in effect, we've got two projects on the go this year.

As it relates to some of the environmental concerns, cleaning up the beaches and trying to determine the impact on escapees in the rivers, I'd say that our First Nation is probably one of the most proactive stakeholders. As of to date, we haven't seen any investment or contribution from the aquaculture industry directly, although they've remained cooperative in terms of allowing us to avail of their salmon to escape and sharing data with us.

Senator Poirier: Is the reporting of an escapee from a fish farm a requirement of a license in Newfoundland and Labrador?

Mr. McDonald: Yes, and Clyde can better speak to that.

Mr. Collier: Yes. I think the threshold is if there are greater than 100 fish, but the recent conversation with DFO is that even zero fish can be a reason to report. If a farm notices that there is a breach in the net, or whatever, to report that. It would be presumed to be a fish loss without there actually being any fish noted to be gone.

Senator Poirier: Okay, but as the band, First Nation, you're not a licensee, right?

Mr. McDonald: Not licensed in terms of?

Senator Poirier: Aquaculture.

Mr. McDonald: We're not a licensed fish farmer at this stage, no.

Senator Poirier: All right. Thank you.

Senator Raine: This has been very interesting, and I feel badly for the trials and tribulations you've gone through.

Mr. Collier, is Gray Aqua Group surviving and moving on?

Mr. Collier: Yes, they have survived bankruptcy.

Senator Raine: And you're staying in Conne River?

Mr. Collier: Yes, we are.

Senator Raine: So all of the bad stuff is behind you and you're moving forward.

Mr. Collier: Praise the Lord.

Senator Raine: I see in our notes that you and the First Nation are collaborating on a research project investigating in the potential for reproduction between wild and farmed salmon in Newfoundland and Labrador. Could you briefly describe the project?

Mr. Collier: That's the hybrid project. I think Shayne talked about farmed fish and wild fish. There's been a study in Scotland, I think, that showed that if they interbreed, the hybrids don't survive as well.

I'm going to speak to what Senator McInnis spoke about a little bit earlier, the effects of pH. We were applying for a site in Salmonier Pond, and it was turned down because of the feared interaction between our smolts and wild smolts, and I was peeved. So I was speaking with DFO about potential studies because I had some experience with Saint John River salmon and trying to get them to fertilize eggs to survive. We couldn't do it.

So we read a paper from Nova Scotia about dosing the water with limestone, so we started doing some dosing work to bring up the pH to get the eggs to survive, and it worked.

In talking to DFO, I had a theory that if pure farmed salmon tried to spawn and were from New Brunswick originally, they would not have adapted property to Newfoundland waters and would not have been able to successfully spawn in Newfoundland waters because of the low pH.

So DFO, they ran with the project and got involved. They have an ACRD program, so with the Grays and the band and DFO, we started looking at some of these cross-breeds and how well they might survive — and I was wrong.

Senator Raine: They did survive.

Mr. Collier: Oh, yes.

Senator Raine: Is it still ongoing or is it completed now?

Mr. Collier: That part of it is complete but they have some other plans. I can't speak to that directly because I haven't read about it, but yes, that original project is finished.

Senator Raine: Thank you.

One of the other things I noticed was that you said the return rate of salmon on the Conne River was lower before aquaculture started.

Mr. McDonald: I know, an anomaly one or two years.

Senator Raine: So is that perhaps because of the dam construction?

Mr. Collier: Possibly, there are a lot of things around the Conne River during that period of time that took place that could possibly have had an effect.

In the late 1970s in terms of forestry management, they were using a chemical called Fenitrothion. When that thing breaks down in the environment, the breakdown chemicals behave like estrogen, so they can have the ability to feminize fish. That possibly could have had an effect.

Then around 1985 there was a major forest fire that ran up around the banks of the Conne River and around the spawning area. If forests are not around spawning areas, you can get potential flash floods. So flash flooding around spawning areas may have caused some of the issues in the late 1970s. We don't know exactly because no one was monitoring it.

The other thing that happened in that area around the headwaters of the Conne River, the Conne Pond, it got built up with cottages. One of the ways around the pond for Ski-Doos is to rattle around that thing. One of the crossing areas is right over the spawning bed. Salmon, when they are developing, they go through a very sensitive stage just prior to what's called "eyeing up," and they can die very easily due to shock. It happens when people are racing across that spawning bed with their Ski-Doos right in the middle of that sensitive period, so that possibly could have had an effect.

Mr. McDonald: The bottom line is what impacted the returns on the Conne River such that it's declined, whereas in other parts of Newfoundland it got healthy and increased? The bottom line is that there has been no empirical evidence pointing specifically to one cause. There has been a lot of conjecture in terms of what might be the factors at work.

Some of the studies that the band did with DFO indicated that the smolts are coming out of the river. So the river is producing young salmon, but they're not coming back. I think Brian Dempson indicated something is happening with sea survival, so that's either climate change, acidity, St. Pierre Miquelon catching them before we get a chance to catch them; no one knows at this point in time.

Our concern is that the salmon rivers are in a very precarious state with low returns, barely meeting spawning requirements. If aquaculture has the potential to have a negative impact or if it is having a negative impact, we're of the opinion that it's worth the inquiry, further research and development and collaboration amongst all stakeholders to get to the bottom of any potential impact down the road.

Senator Raine: You're in a very unique position where you are to really work on that research. I'm very encouraged that the band and Grays are both interested in it.

One last question. This is just off the wall, but I was thinking that when you were saying we need to be able to identify the escaped salmon, is it possible to cut one of their fins so that they can be differentiated?

Mr. Collier: You don't need to cut it. Anyone that is familiar with salmon can tell immediately if it's farmed or wild.

Senator Raine: How?

Mr. Collier: All of the fins on a farmed fish will be eroded; the erosions are immediately obvious.

Senator Raine: Eroded?

Mr. Collier: Eroded.

Mr. McDonald: Densely populated.

Mr. Collier: They're densely populated and touch against each other, so their fins get shortened up. Wild salmon, their fins will be completely intact.

Senator Raine: So that's what the people are looking for when they're looking for escapees.

Mr. Collier: Yes. If they identify fish with eroded fins, DFO will say maybe the wild fish had eroded fish as well, so we need to check. They'll take a scale sample.

Wild fish take about five years to grow from egg to smolt and then go to sea, so they're much, much older. The scales will lay down a pattern just similar to a tree, how trees grow.

Senator Raine: So a fish this size is —

Mr. Collier: It's only three years old, so it's easy to tell from the scale.

Senator McInnis: It's a different, the inside. If you looked at it, they don't feed the colour, the pigment; they don't feed that until the latter stages.

Mr. Collier: But there are other ways you can tell if you open it up.

All farmed fish are vaccinated, and the vaccination that they use is an oil-based emulsification. That causes a reaction in the stomachs, so there are connective tissue things that take place and also some melanin staining in the intestine. To someone who knows what they are looking at, they will see it immediately.

Senator Raine: It's fascinating.

Mr. McDonald: I'd prefer to determine the classification of a salmon as farmed or wild to exercising my culinary abilities, within the regulation, of course.

The Chair: Very interesting.

Senator Munson, you will have the last word.

Senator Munson: Thank you, chair, for giving me that opportunity.

It's not easy being an escapee, finless in the ocean.

I was just on Wikipedia and 862 are living on reserve, as you said, close to 900; and 2006 living off reserve. Hearing your stories, you're literally at the end of the road and it must have been devastating for you.

Sometimes people don't make much of what legislation means on Parliament Hill and we are asking those questions, so I wrote it down because I want to get it right. What specific protection or benefit would your community receive from a federal aquaculture act? In other words, would you take another chance at full fish farming if you had something like this act in place? If you could try to be specific for me, what would be tangible for your community out of this act that would make things better?

Mr. McDonald: I think the federal aquaculture legislation would bring a number of factors to the band that would make it more comfortable in entering aquaculture.

No doubt the band will be consulted in terms of the actual wording and what the legislation means in terms of potential impact to the band. If and when that takes place, we would indicate some of the concerns we have regarding the environment; probably the need for specific legislation to deal with marine debris; requiring farms to label their equipment such that when it breaks apart and drifts, a farm can be held accountable because this is your cage. Right now under Transport Canada, cages are required to be marked when they're set up for grow-out, but if a farm moves in close to a community so that they could freeze in the ice during the winter, Transport Canada doesn't take the view that that's a grow-out site. We've had incidents of snowmobilers breaking legs and ribs. There's a legislative void where companies are not legislatively required to put better markings. Some companies, like Gray Aquaculture, have gone out of their way and put on very ample marking; other companies have done minimal marking; and then other companies have done nothing because there's no legislation with teeth requiring them to do that. So we see a host of areas of concern that the legislation can potentially address.

The other thing is our relationship with the federal government is unique given the situation of Aboriginal people in the Canadian Constitution and the fiduciary duty of the federal government. DFO, as it relates to the Fisheries Act and their activity under that act, consults with us heavily and seeks our input, whereas under the provincial regime that's not the case. Unless we specifically lobby our concerns or if we were a licensed farm grower, we would have a higher level of input and involvement; whereas we perceive under federal legislation the consultation and the safeguarding of the band's interests would be more heightened, given the unique position of the federal government as it relates to Aboriginal communities and Aboriginal peoples.

I think under that regime we would be more comfortable entering aquaculture and more comfortable, even if we didn't enter aquaculture, that environmental issues would be more addressed and addressed in a manner that has enforcement and, for lack of a better word, "teeth" behind the enforcement.

The Chair: I want to thank our guests. It's been a worthwhile discussion. As I listened to your remarks, and the remark of "no community is an island" is very important to us all. To hear about the cooperation of the towns in the Coast of Bays Region will, down the road, serve to be an example for us all. I wish you luck with all your endeavours on that.

Senators, that concludes our day. Thank you for your patience and your interest. I certainly look forward to our road trip tomorrow to Halifax.

Thank you to all the people who helped us take care of today, all around, our sound people and our interpreters. I said to the interpreters this morning, "You're in Newfoundland now, so you're going to have to work for your money here because it's going to be a little touchy at times," but I think they did very well.

Senator Wells: I will be the first to admit that I dropped a few "h's" and picked them up elsewhere.

The Chair: Picked them up somewhere else, for sure.

Thank you very much.

(The committee adjourned.)

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