Economic Development

The Economic Development component has several different categories to ensure that it responds effectively to the needs of Indigenous people in Québec:

• Budget envelopes reserved for communities
• Specific categories for certain client groups (young people, women, social economy enterprises and mobilizing organizations)

The objectives of this component are to:

• create an environment to foster economic development,
• contribute to business startup and development,
• help create and consolidate Indigenous jobs,
• generate investment in Indigenous communities,
• support entrepreneurship among women and young people, and
• support the development of social economy enterprises.

Subject to the eligibility criteria and to the requirements for each component category, an eligible project must:

• enable the objectives of the component to be achieved, and
• be submitted to the SAA no later than March 1, 2027.

To have access to this budget envelope, a community must:

• have signed a special agreement with the Minister Responsible for Indigenous Affairs, during the IIF IV implementation period, in which it undertakes to submit economic development projects,
  • Whatever the date on which the special agreement is signed, it will end on March 31, 2027.
  • Communities that have not used all the funding provided for under programs prior to IIF IV may be authorized to commit an additional amount that matches the remaining balance during the life of this program.
• not have signed an agreement with the Government of Québec allowing it to fund economic development projects, unless such an agreement specifically states that it will not be detrimental to the renewal of IIF IV funding.

To be eligible, an economic development project must have been prioritized by a resolution of the nation or community.

• Projects that meet the criteria of the Community Infrastructure component are eligible for funding under the Economic Development budget envelope if the Community Infrastructure component has been entirely spent.
• Eligible projects in the Social Economy and Women and Youth categories may, with no limit on the maximum amount per project, receive support in their respective category from the amounts reserved for band councils, provided a resolution has been obtained from the band council concerned.

The assistance granted by the Government of Québec and its agencies cannot exceed 50% of eligible costs, and the combined total of financial assistance received from various levels of government cannot, except in certain circumstances, exceed 90% of eligible costs.

An Entrepreneurship project must target business startup, expansion or development. It must, in addition, meet one or more of the following requirements:

• Have a structuring effect on the Indigenous population
• Target job creation for Indigenous people
• Be economically and socially sustainable
• Increase the visibility of the Indigenous nation or community and the Indigenous population in general
• Enable the community’s development objectives to be implemented

Structuring projects for economic development that generate indirect benefits may also receive support, provided the benefits can be demonstrated.

Eligible costs for this category are limited to capital expenditure, as defined by generally accepted accounting principles.

However, assistance may be granted for activities to promote transition to the digital age as part of an eligible entrepreneurial project. In this case, the costs linked to the design of websites or web platforms are eligible, for up to 20% of the total eligible project costs.

A Study project must mainly concern the completion of a study needed to develop a project eligible for the economic development budget envelope. The project may, for example, concern:

• the completion of a business plan,
• an assessment of a project’s technical and financial feasibility,
• a market analysis for an investment project, or
• a study for the integrated management of traditional Indigenous resources and activities.

All the costs of completing the study are eligible.

The amount allocated to studies may not exceed 30% of the total budget envelope for economic development in the community.

A Workforce Training project must mainly concern training and skills upgrading for the Indigenous workforce as part of an entrepreneurial project. The training needed for the startup, expansion or consolidation of an entrepreneurial project that is admissible for this program component may be eligible, provided that the person receiving the skills upgrading is Indigenous. Funding for this type of training cannot exceed 20% of the total eligible project costs.

To complement other existing programs in the field of skills upgrading and workforce development, it is possible for a nation or community to use some of its reserved funding to complete funding for the costs generated by vocational training for its members (educational cohorts, buddy system, etc.). The amount allocated for this type of training cannot exceed 20% of the total budget envelope allocated for the economic development of the community.

All direct training costs are eligible. Indirect costs, such as accommodation and wage compensation costs for individuals receiving training, are excluded.

An assistance for local economic development project must mainly concern helping the nation or community to structure its economic development more effectively. More specifically, projects must aim to:

• help communities develop and coordinate a strategic economic development plan,
• identify, highlight and improve access to local resources, or
• recruit and train local economic development officers in Indigenous communities.

All implementation costs are eligible in this category of project.

Financial assistance under this component may also help a community implement a business support measure. In these cases, the measure must comply with the terms and conditions of IIF IV and be approved by the SAA. Reports must present, on an annual basis, the initiatives supported by communities to ensure that compliance can be verified.

This financial assistance cannot exceed 50% of the economic development budget envelope allocated to the nation or community.

This category mainly concerns projects submitted by social economy enterprises and Indigenous non-profit organizations in the social economy field working inside or outside a community.

Social economy businesses sell products and services in innovative sectors that are just as diverse as those covered by other businesses. The mission of so-called “social economy” businesses is to sell goods and services that meet the needs of the community. They operate like a business but have a social purpose.

The Social Economy sector includes three types of businesses, grouped by legal status:

1. Cooperatives and mutual associations, made up of cooperatives formed under the Cooperatives Act or the Act respecting financial services cooperatives and mutual associations formed under the Insurance Act.
2. Associations, meaning non-profit organizations instituted pursuant to Part III of the Companies Act, whose financial viability depends mainly on independent income from the production and provision of goods and services.
3. Social economy enterprises, which have principles and operating rules that define them specifically. They must:
   • have a mission of serving their members or the community rather than simply generating profit and targeting a financial return,
   • be managed independently of the state,
   • incorporate in their by-laws and procedures a democratic decision-making process that includes their customers,
   • prioritize people and work over capital when sharing their surpluses and revenue, and
   • base their operations on the principles of participation, empowerment, and individual and collective responsibility.

Non-profit organizations whose mission is not mainly entrepreneurial, such as community organizations, charities, economic development corporations, municipal agencies, and so on, are not social economy enterprises. However, these organizations can set up social economy projects that meet the criteria above, for example to generate own-source revenue. In addition, Indigenous non-profit organizations in Indigenous communities may also be eligible, provided that the goals of their social economy projects include generating own-source revenue.

All the implementation costs for a project in this category are eligible.

The assistance granted by the Government of Québec and its agencies cannot exceed 80% of eligible costs, and the combined total of financial assistance received from various levels of government cannot exceed 95% of eligible costs.

The per-project limit is set at $200,000, and the maximum amount granted per organization is set at $500,000 for the duration of the program. A single organization may implement several projects but may not exceed the maximum amount.

This category concerns business leaders aged 35 and under, and female Indigenous entrepreneurs.

It supports projects whose objective is to promote entrepreneurship among Indigenous young people and women by offering financing possibilities in communities where other prospects are limited.

Eligible projects must be connected to business startup or development. Eligible costs are limited to capital expenditure, as defined by generally accepted accounting principles.

It is also possible for applicants to obtain funding for skills upgrading or training in connection with an entrepreneurial project. The funding must mainly concern the acquisition of the skills needed to complete an entrepreneurial project that is admissible for this program component, provided that the person receiving the skills upgrading is Indigenous. All direct training costs are eligible, but indirect costs, such as accommodation and wage compensation costs for individuals receiving training, are excluded. Funding cannot exceed 20% of the total eligible project costs.

It is also possible to receive funding for activities to promote transition to the digital age as part of an eligible entrepreneurial project. In this case, the costs linked to the design of websites or web platforms are eligible, up to 20% of the total eligible project costs.

The per-project limit is set at $150,000, and the maximum amount granted per promoter is set at $250,000 for the duration of the program. The assistance granted by the Government of Québec and its agencies cannot exceed 70% of eligible costs, and the combined total of financial assistance received from various levels of government cannot exceed 95% of eligible costs.

Applications are assessed and the adequate funding ratio is determined using the following criteria, subject to funding available in the budget envelope:

• Demonstration of financial need
• General financial situation of the business
• Possibility of accessing standard financing
• Socio-economic and competitive context of the community in which the project is implemented
• Effective ownership and the role of the applicant (youth or woman) in the business
• Expected economic benefits (payroll and employment created for Indigenous people)
• Technical and financial feasibility of the project
• Originality of the project
• General quality of the project and the documentation presented

A project in this category must have a mobilizing effect on the overall economy of Indigenous communities. It must also be supported by a consensus among the Indigenous nations concerned.

All necessary costs for implementing projects in this category are eligible.

The assistance granted by the Government of Québec and its agencies cannot exceed 50% of eligible costs, and the combined total of financial assistance received from various levels of government cannot exceed 95% of eligible costs.

The promoter must demonstrate the financial need and provide the SAA with a business plan that includes:

• the amount requested,
• the justification for the financial need, and the relevance of the budget envelope to the project’s implementation,
• the project location and client groups targeted,
• the timeframe for project implementation,
• a breakdown of project expenditures and funding, including details of other expected sources of funding,
• a description of the skills and experience of the other promoters connected with the project,
• the expected benefits and outcomes of the project,
• the steps taken to check the project’s eligibility for other funding programs,
• the estimated operating budget for a three-year period,
• the most recent financial statements, if applicable, and
• a band council resolution, if required.

For all categories in the Economic Development component, the reimbursement of a debt or deficit, and working capital, are not eligible costs.

Special condition for an infrastructure located outside an Indigenous community

To be eligible for funding for construction work of $100,000 and more on an infrastructure located outside an Indigenous community, an eligible organization must meet at least one of the following conditions:

• Hold title as the owner of the infrastructure concerned
• Be in the process of purchasing the infrastructure, as demonstrated by a formal written undertaking
• Hold or be in the process of obtaining a lease or emphyteutic lease that is or will be in force for at least five years after construction is complete

Requirement to seek bids

For an eligible project that requires construction work costing $100,000 or more, the eligible organization does not need to issue a public call for tenders to award the contract as provided for in the Act respecting contracting by public bodies (CQLR, chapter C-65.1).

However, the eligible organization must meet the following minimum requirements for awarding a construction contract of more than $100,000 but less than $1 million:

• Issue an open call for tenders with a public announcement
• Issue an invitation-only call for tenders to at least three qualified contractors

For construction work over $1 million, the eligible organization must, at a minimum, issue an open call for tenders with a public announcement. These types of calls for tenders are usually posted in newspapers, displayed in the local offices of construction associations, and/or announced via a public electronic service. They must allow all qualified and interested contractors to bid on the contract. The announcements or public notices must be distributed widely enough to reach a suitable number of qualified and interested contractors, resulting in a competitive bidding process. 

For all calls for tenders for construction work, whether announced publicly or by invitation only:

• the deadline for receiving bids must not be less than fifteen days, and
• bids can only be requested and contracts awarded
  • at a fixed price, or
  • based on a unit price.

Financial assistance cannot be used to make a payment to any entity that:

• is named in the Register of enterprises ineligible for public contracts, or
• has, in the two years preceding the application for financial assistance, failed to meet its obligations after being put on notice to do so in connection with financial assistance previously granted by a department or funding agency of the Government of Québec.

Financial assistance is provided in the form of a grant. The maximum grant is determined according to the financial needs of the promoter and the assistance provided by Government of Québec departments and agencies and by the federal government.

To encourage partnerships between Indigenous and non-Indigenous people, any organization or business forming part of such a partnership will be 100% eligible for the program, provided that the Indigenous promoter retains effective control and owns at least 50% of the partnership, if it is an enterprise.

If the Indigenous promoter owns less than 50% of the partnership, the eligible costs will be covered up to the same percentage.

In general, projects will be assessed using the following criteria:

• Consistency with the program objectives and principles:
  • Eligibility under the terms and conditions
  • Compatibility of the objectives with the objectives of the component
• Technical feasibility of the project:
  • Mastery of the technical aspects
  • Realistic timeframe for completing the project
• Financial feasibility of the project:
  • Detailed financing plan
  • Reliability, coherence and realism of the budget forecasts
  • Cost-effectiveness
• Quality of the organization:
  • Relevance of the promoters’ skills and experience
  • The appropriateness of the choices made with respect to outside experts, if applicable
• Thoroughness of the market analysis, including knowledge of client groups’ needs
• Results to be achieved using the funding requested:
  • Number of jobs created or maintained
  • Investment generated
  • Contribution made to local and regional development
  • Economic and social sustainability
  • Structuring effects for Indigenous people

Some sub-components may include specific criteria, which will be considered in conjunction with the general criteria.

Funding of $25,000 or less may be formalized in an acceptance letter setting out the reasons for the grant and the applicant’s obligations.

Funding of more than $25,000 will be formalized in an agreement which must contain:

• the obligations of each signatory,
• a detailed description of the project and its objectives, and
• indicators for the production of reports.

Each applicant receiving a grant of more than $25,000 must, as a minimum, provide a report in compliance with the provisions of the financial agreement. The report must include:

• a full report of the activities completed,
• a description of the results as compared to the objectives.

The report must be submitted with a financial statement showing how the grant was used, along with conclusive supporting documents. The organization must, at all times, keep separate accounts for project expenditures in accordance with generally accepted accounting principles.

Funding of $25,000 or less may be paid in full once the acceptance letter has been sent.

Funding of more than $25,000 will be paid in a minimum of two instalments, the first of which may not exceed 80% of the full amount of the financial assistance. In all cases, the last instalment provided for in a financial agreement will only be paid once all reports have been filed with the SAA.