First Nations Economic Consulting

Economic Consulting Services:

1. First Nations Economic Damage Assessment including:
   

   1. Loss of use of Reserve land,

   2. Loss of use of resources

   3. Loss of Life

2. Present Value of historical losses including:

   1. Issues related to the compounding approach

   2. Issues related to the use of the Proxy Model

   3. Court cases related to the traditional 80-20 percent approach

3. Loss of traditional harvesting including:

   1. Loss of traplines 

   2. Loss of commercial fishing

   3. Loss of infrastructure

   4. Loss of recreation

Methodology for estimating the Loss of Use:

The Proxy Model

The Proxy model used by the Specific Claims Branch, Indian and Northern Affairs Canada to estimate economic loss of use in specific claims in which a First Nation has lost the use of land and resources. The attractiveness of the model relates to its simplicity.

The methodology used in the Proxy model is basically a rental model with minimum information requirement. The model uses three pieces of information in order to estimate rental losses during the loss period. Then, historical losses are brought forward to today's dollars using multipliers that are agreed upon by the negotiating parties. The required three pieces of information are as follows:

1. The value of the claim lands at the beginning of the loss period.

2. The Consumer Price Index (CPI)

3. A proxy for the rental rate of return on the land

However, the Proxy Model is only one approach to calculating historical losses of use. Given the availability of information, a direct method can be used to estimate historical losses in cases where loss of resources such as mining, fishing, traditional harvesting, etc. are involved.

The Proxy Model is not perfect and there are issues with it that our experts have dealt with in many reports that we have written on behalf of various First Nations as well as Northern Affairs Canada where disputes have arisen.

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