Nearly $3 million earmarked for affordable housing in Watson Lake appears to have been spent by Liard First Nation on acquiring three hotels, instead.
The First Nation justified the deal, made in June of 2007, by promising to convert part of one hotel into affordable housing for its members.
But, more than two years later, this hasn’t happened.
This raises big questions about the administration of the federal Northern Housing Trust program, which provided Yukon with a total of $50 million between 2006 and 2008.
Of that, $32.5 million was given to First Nations. Liard First Nation received $2.83 million.
It’s unclear how much of Ottawa’s housing money helped Watson Lake residents hard-up for a home. But the grant did enrich two close political allies of Premier Dennis Fentie, who approved the spending.
One is Archie Lang, MLA for Porter Creek Centre and minister of Community Services.
The other is Pat Irvin, a Yukon Party campaign organizer whom Fentie recently appointed as chair of Yukon Energy’s board of directors.
Lang and Irvin owned the hotels, which were sold for a sum that was never publicly disclosed, but rumoured to be about $3 million.
Territorial officials insist that it was the First Nation’s idea to buy the hotels, and that the premier merely approved the spending. They also say Lang was never involved in the decision to award the grant.
Neither Lang nor Fentie responded to interview requests. Irvin was out of town this week and could not be reached.
When the territorial government doled out the federal money it placed few conditions on the grants, in an effort to treat First Nations as equal levels of government, as is often requested.
One result is that territorial officials don’t know how many housing units were built by First Nations with the $32.5 million.
Another result of this hands-free approach is that no one bothered to check whether the Liard First Nation actually converted a hotel into housing.
It appears it didn’t.
There’s no affordable housing offered at the Belvedere Motor Hotel, Watson Lake Hotel or Gateway Motor Inn, according to the receptionist at the hotels’ central reservation line.
Alex Morrison, president of the Liard First Nation Development Corporation, refused to say how much, if any, his First Nation spent on building affordable housing with its share of the trust money.
He deferred all questions to Chief Liard McMillan, who did not return repeated phone calls before press time.
The First Nation did purchase an apartment building around the same time as the hotels. But, if the apartments were bought with housing trust money, this is not indicated in a page from the First Nation’s 2007 financial statements, obtained by the News.
“The Liard First Nation Development Corporation purchased three hotels in Watson Lake, Yukon, using funding provided by the Liard First Nation by the Government of Yukon under the Northern Housing Trust established by the Government of Canada. A portion of one of the hotels it to be used as housing units for the First Nation,” the document states.
Morrison described the hotel acquisitions as a business venture by the First Nation at the time of sale. He never mentioned plans to turn a hotel into housing.
Nor did he say that the financing came from Ottawa’s fund to build affordable housing in the North. Instead, Morrison told the CBC that the hotels were bought with “internal money and some financials from major banks.”
Lang was never directly involved in approving the grant, said Dermot Flynn with the territory’s land claims secretariat. The decision was solely Fentie’s, he said.
The mid-year spending needed to be approved by management board, on which Lang sits.
But the board did not vote on individual funding agreements, said Flynn. Instead, it simply approved the entire $32.5-million transfer to First Nations.
That money was divvied up by First Nations, based on a motion passed by the Council of Yukon First Nations.
Grant applications by First Nations were largely “fill in the blank” exercises, said Flynn. And, once the money was disbursed, there were few reporting requirements for First Nations to comply with.
First Nations needed to clearly state in their accounting records how they spent the trust money, and they needed to annually disclose these financial statements to the territory.
But there was never any follow-up to ensure the money was spent as claimed.
“We largely left it up to them to make their own choices,” said Flynn.
Contact John Thompson at
johnt@yukon-news.com.