Economy

‘Permitting predicament’ could hurt industry, says NWT Tourism


Northwest Territories Tourism says a “permitting predicament” involving the Łutsël K’é Dene First Nation’s Frontier Lodge could have far-reaching impacts on the territory’s tourism sector.  

Harold Grinde, chair of the NWT’s tourism industry body, highlighted concerns in a letter to Caroline Cochrane, the premier and minister of the Department of Municipal and Community Affairs (Maca).

In the May 28 letter, Grinde said there had been a “significant failure of government policy” when it comes to regulating remote lodges.

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His letter comes after the Łutsël K’é Dene First Nation raised concerns about bureaucratic delays and red tape in getting a business and liquor licence approved for the lodge.

I really would like to see this sorted out so that our lodges and ourselves have a clear understanding.

ELEANOR YOUNG, Maca

“We need the GNWT to work with us and our members to build and promote our industry, not to create new barriers for success and disincentives for investment,” Grinde wrote.

The First Nation bought the long-operating lodge in December 2019, but began facing issues when it applied for a liquor licence. According to Maca, that triggered the need for a Maca business licence, an occupancy load permit, and an inspection to confirm fire safety requirements. 

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But Maca is still working out kinks with the “complex issue” of licensing remote lodges, which involves multiple pieces of legislation and other territorial departments. 

Previously, remote lodges only required a tourism operator licence, regulated by the Department of Industry, Tourism, and Investment (ITI).

After reviewing the Fire Prevention Act and the Business Licence Act, however, experts determined the government wasn’t applying legislation as it was intended, and other regulations come into play when a liquor licence is involved. 

Currently, eight remote lodges in the territory hold liquor licences. Seven of those were licensed before changes were made to the Liquor Act in 2008, according to the Department of Finance, which is responsible for the act. 

The Łutsël K’é Dene First Nation is now caught in the bureaucratic web, Maca says, as this is the first time in a while that a new lodge owner has applied for permits and licences. 

Grinde stressed that this problem extends far beyond Frontier Lodge. He said if it’s not addressed, other communities and entrepreneurs aren’t likely to invest in any of the territory’s remote lodges.

‘The pace of molasses in January’

NWT Tourism wants ITI’s tourism operator licence to continue to act as the business licence for remote lodges, noting the application process involves safety planning. The group also wants the government to create a fund to help lodges modernize infrastructure and meet safety requirements.

Those are the same recommendations NWT Tourism made in March 2017, when it submitted comments during a public engagement on the review of the Fire Prevention Act.

Cathie Bolstad, chief executive officer of NWT Tourism, said the issue of licensing remote lodges first came up in late 2016, when another lodge applied to renew its liquor licence. 

Cathie Bolstad.

She said the act requires structures to meet the 2015 national building code, which is a problem as that’s an unrealistic standard for lodges given their remote location and seasonal nature.

NWT Tourism recommended in 2017 that the government develop minimum building standards for remote lodges to ensure they’re safe, meet code requirements, and can remain financially viable while doing so.  

“That still hasn’t been done today,” Bolstad said. 

“The pace at which the government of the Northwest Territories is addressing legislative and regulatory environments for business is the pace of molasses in January.”

Bolstad said the government needs to act quickly as lodges already have high costs, while they operate in a short summer season with a small construction window.

The issue is especially frustrating, she said, as the Łutsël K’é Dene First Nation “has a new national park reserve [Thaidene Nene] on its doorstep” and has worked with the territorial government to develop its tourism strategy.

Covid-19 is already having a negative impact on the territory’s tourism industry, she added. 

“It’s another nail in the coffin and we need government to reduce red tape. We need government to set reasonable standards.”

Act ‘out of touch with the economic reality’

Yellowknife North MLA Rylund Johnson said he has long been frustrated with similar policy issues.

“I have many constituents who have tried to open businesses in older buildings in Old Town and, as soon as they run into code changes, it’s just simply not feasible and it never would be economically feasible,” he said.

A file photo of Rylund Johnson in October 2019. Sarah Pruys/Cabin Radio

A file photo of Yellowknife North MLA Rylund Johnson. Sarah Pruys/Cabin Radio

Johnson added it’s “nonsensical” and “out of touch with the economic reality” to force an Indigenous government to bring a remote fishing lodge up to code without support. He noted flying in construction materials alone would be costly.

Johnson said the “clear solution” is to amend the Fire Protection Act, create more flexible terms for granting occupancy permits, and give people time and funding to meet regulations and codes. 

He agrees remote lodges should be regulated under one department, adding it’s inefficient to have multiple departments involved in licensing and permitting a business before it can start earning revenue.

Johnson said, however, he understands the government is just trying to follow the current legislation and regulations. He said the Fire Prevention Act will be updated during the current Legislative Assembly. 

Maca working on ‘all of government’ solution

Maca said the department has spoken by phone to the owners of Frontier Lodge and NWT Tourism about “the complexities” of licensing remote lodges, and is working to develop an “all of government” solution to the issue.

Eleanor Young, deputy minister for the department, said since the review of the Fire Prevention Act began, the department realized more work needed to be done surrounding plan reviews, inspections, and regulatory authorities. 

That has taken “a little longer than normal,” she said, because the same staff working on the act were directed to implement 9-1-1 legislation by the previous Legislative Assembly. Work has also been delayed by the pandemic. 

Eleanor Young, deputy minister of municipal and community affairs

Eleanor Young, deputy minister of Municipal and Community Affairs. Emelie Peacock/Cabin Radio

Young said she hopes work will continue in the late summer or fall, including engagement with engineers, architects, the tourism association, and remote lodges. 

The government is considering creating a building standard that is appropriate for remote locations, she said. If a physical inspection from the fire marshal is required, the department would budget for that.

“One of the things I learned early on in my career with municipal governments is, whatever you create or commit to doing, you have to be able to sustain that,” Young said.

In its initial response to the Łutsël K’é Dene First Nation’s concerns, Maca had proposed hiring an expert on adopting fire prevention regulations to address any issues the lodge may have before it is inspected. 

Young said the government does not have that kind of consultant on staff, however, and – before it goes down that route – she would like to come up with a solution that works for everyone.

 “I really would like to see this sorted out so that our lodges and ourselves have a clear understanding of what the expectations are and how we can work together … on this moving forward.”

She said the department recognizes how important the territory’s tourism industry is, and its goal is not to put barriers in place but to ensure public health and safety. 

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