Unpaid teachers at Manitoba reserve school want Ottawa to take over its financial management

First Nation organizations aren't crazy about proposed federal legislation that would have Ottawa looking over their shoulders when it comes to running reserve schools.

But the story of Manitoba's Sandy Bay First Nation school looks like the poster child for the argument that at least some do need the oversight laid out in the Conservative government's First Nations Education Act.

The Manitoba Teachers' Society is asking the government to appoint a third-party manager for the First Nation to deal with its troubled finances.

The society says paycheques for the reserve's 58 teachers have bounced, retirees aren't getting their pensions and those on sick leave can't access disability benefits, The Canadian Press reports.

“The situation for our members in Sandy Bay has become worse than intolerable,” society president Paul Olson told a news conference Tuesday, according to CP.

But Sandy Bay's leaders are rejecting the demand for federal intervention. Chief Russell Beaulieu blamed the previous band council for running up a debt of at least $19 million but that the First Nation is working to repay its creditors, CP said.

The Sandy Bay First Nation, located on the shores of Lake Manitoba about 165 kilometres northwest of Winnipeg, has about 6,200 registered members. Its website says the band was granted independent control of its school in 1976 and has more than a thousand students in elementary and secondary school classes.

[ Related: Proposals for First Nations education not acceptable: Atleo ]

Aboriginal Affairs and Northern Development Canada default-management web page currently lists Sandy Bay as being co-managed with an outside adviser to implement its plan to get out of default. It's one of 162 First Nations under some form of third-party or co-management situation, 46 of them in Manitoba.

Beaulieu said the band had just fired its co-manager and a new one would start next week to continue helping to organize its finances.

Appointing a third-party manager would cause greater hardship because services would be cut drastically, he said.

The society, which represents the reserve's teachers, said in a news release on its website that it's been trying to resolve the situation for the last 18 months but now needs Ottawa to step in.

“We have exhausted all other options," said Olson.

Things have worsened in the last year despite promises by the band to pay its debts and meet its obligations, the society said. When the society moved the latest deadline to Feb. 1, it passed without any progress, he said.

"Promises were broken time and time again," Olson said.

The society, whose lawyers have submitted a detailed package of material to Aboriginal Affairs to support its request, also alleges the First Nation has not been forwarding pension contributions, insurance and employment premiums to the requisite institutions and agencies, CP reported.

“All the deductions have been made," said Olson. "Where the money went after that, is anyone’s guess. We’re hoping that third-party management might reveal that and actually fix the problem.”

The reserve's teachers are owed a total of $737,000, he said.

Beaulieu conceded payroll deductions were made but didn't know where the money has gone. The band can't afford a forensic audit to get to the bottom of it, he told CP.

"We have hardly any money," he said. "We're finding out as much as we can."

Beaulieu also said that teachers continue to pay premiums on their health benefits, which they aren't receiving, because the insurance company is among the First Nation's creditors.

George Beaulieu, Sandy Bay's education director, called the society's demand for third-party management "sour grapes." He admitted paycheques were late in the past but now are up to date, CBC News said.

Aboriginal Affairs declined to comment on the specifics of the case Wednesday.

"This situation is completely unacceptable and we encourage the First Nation to resolve their financial difficulties as quickly as possible," Minister Bernard Valcourt's spokeswoman Erica Meekes said in an email to CP.

Teacher Mike Beaulieu, who has taught at Sandy Bay for 23 years and whose father founded the school, said cheques have been withheld many times and teachers were told if they wanted to be paid on time, some would lose their jobs, CP said.

“I have trouble getting out of bed in the morning to show up there — the atmosphere in the school, the promises that are broken, the uncertainty,” an emotional Beaulieu said. “If it wasn’t for the students in my care, I don’t know if I could stay there.”

[ Related: Manitoba chief slams First Nations education reform proposal ]

Ottawa proposed the First Nations Education Act last fall after concerns that students on reserve schools were not performing at a level comparable to children the provinces' public-school systems.

"We know that more needs to be done to ensure that First Nation students achieve the same educational outcomes as other Canadians," the government said in an outline on its Economic Action Plan web site.

"The purpose of these initiatives is to work to establish the structures and standards to support strong and accountable education systems on reserve, all of which will set the stage for more positive education outcomes for First Nations children and youth."

The government said it's been consulting with First Nations about the legislation but many chiefs have already rejected it as smacking of paternalism and an attempt by Ottawa to take a more intrusive role in First Nations government.