SUPPORTS ITEM NO. 3
   CS&B COMMITTEE AGENDA
   JULY 31, 1997

                             ADMINISTRATIVE REPORT

                                           Date: July 11, 1997
                                           CC File: 1203

   TO:       Standing Committee on City Services and Budgets

   FROM:     General Manager of Corporate Services

   SUBJECT:  Renewal of Musqueam Service Agreement


   RECOMMENDATION

        A.   THAT Council approve the renewal of the recently expired
             Musqueam Service Agreement on the same terms and conditions
             for a two-year term (January 1, 1997 - December 31, 1998) as
             an interim measure in recognition of the ongoing negotiations
             taking place between the City and the Musqueam Band to achieve
             a long-term service agreement.

        B.   THAT Council authorize the Director of Legal Services to
             approve the renewal agreement on behalf of the City, subject
             to its approval by the Musqueam Band Council.

   COUNCIL POLICY 

   City Council is the approval authority for the service agreements
   entered into between the City and the Musqueam Band.

   PURPOSE

   This report recommends an extension of the recently expired service
   agreement between the City and the Musqueam Band as an interim measure
   until agreement and approvals are reached on the content of a long-term
   service agreement.

   BACKGROUND

   Federal and provincial legislation now permits Indian Bands to levy
   taxes on occupiers of their lands to the exclusion of municipal
   taxation. The Musqueam Band, whose lands are located within the official
   boundaries of the City of Vancouver, opted to levy taxes under this
   legislation commencing in 1991.  That action necessitated the
   replacement of the City's service agreements for the two residential
   subdivisions located on Musqueam Indian Reserve #2. These agreements
   provided for all normal city services in return for payment of all taxes
   levied and billed by the City.


   Since 1990, normal city services have been provided to the residential
   leasehold properties located on the Reserve under a service agreement
   which was negotiated between the Band and the City. This agreement has
   been renewed on a annual basis pending the development of a long-term
   agreement. A number of concerns and issues raised along the way by the
   leasehold community and the Musqueam Band around the development of a
   long-term service agreement have precluded substantial progress in that
   area. 

   A copy of the current agreement, without the site schedules, is appended
   to this report for information.

   DISCUSSION

   Negotiating a long-term service agreement is a complicated process. Both
   parties to the agreement, the City and the Musqueam Band, wish to ensure
   that all policy matters are included in the discussions. A new agreement
   would reflect a more permanent and seamless relationship between the
   parties based on mechanisms to handle cost sharing and pricing of
   services, new development and growth/capacity issues around the
   maintenance, replacement and expansion of the present infrastructure
   (streets, sewer, water, street lighting, signage, etc.) servicing the
   Reserve properties, among a number of other common interests.

   Staff on both sides believe the recently expired service agreement
   embodies the terms and conditions that reflect the principles of a 
   service contract which could be amended to develop a long-term
   agreement. Work towards this end has already started and meetings will
   be conducted over the near term to reach agreement and approval of
   amendments to the interim service agreement on an issue-by-issue basis.
   Our recommendation is to extend the current agreement for an additional
   one year term to facilitate  negotiations.

   I also note for Council that the Celtic Shipyard properties, which are
   located outside of the boundaries of the Musqueam Indian Reserve #2,
   will not be included in any service agreement unless and until there is
   an ultimate negative outcome in the appeal concerning the decision of
   the assessment Court of Revision to remove these properties from the
   City's assessment roll. Moreover, 
   we understand that adoption of a Land Code under the First Nation Land
   Management Act by the Musqueam Band is not in the offing for several
   more years at least. Again, that outcome would likely require changes to
   the City's service agreement as well.


   CONCLUSION

   The recently expired service agreement between the City and the Musqueam
   Band covering both the Village and leasehold properties located on the
   Musqueam Indian Reserve #2 needs to be renewed. We are proposing that
   this service agreement be again renewed on the basis that a long-term
   agreement will evolve through the negotiation process now under way. 

   The recommendations of this report support that position and are
   submitted to Council for consideration and approval.
    

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