A consultant working for Cat Lake First Nation in northern Ontario is locked in a dispute with the band over how much money it owes him for his role in helping to secure federal funding to address urgent housing needs in the remote community.

Gerald Paulin signed a contract with Cat Lake in November 2017 for 10 per cent of any new money the community received. He says that entitles him and his company, Windsun Energy Corp., to $1.2 million after the federal government recently pledged $12.8 million for emergency housing.

But Cat Lake First Nation Chief Matthew Keewaykapow says the band is still discussing the matter with its lawyers.

"Our lawyers have advised us not to respond until they have done their due diligence," Keewaykapow said in a text message.

The community, located 600 kilometres north of Thunder Bay, Ont., declared a state of emergency in January due to a severe housing crisis. An inspection of all 128 homes a month earlier had found that most should be replaced, partly due to mould issues in many of the houses.

Cat Lake First Nation's housing crisis caused it to declare a state of emergency in January. An inspection of all 128 homes a month earlier had found that most should be replaced. In many cases, it was because of mould. (Raul Rincon)

At the time, the chief and council said they believed long-term exposure to mould was harming the health of at least 100 residents.

"People in Cat Lake get sick non-stop," said Deputy Chief Abigail Wesley. "Coughing, multiple pneumonia incidents, related kidney diseases and increased medical problems."

Community leaders say Cat Lake has struggled with housing issues for years due to what they say is chronic underfunding from Indigenous Services Canada.

After weeks of negotiations, an agreement for new money to address the housing and health crisis was announced at a meeting between band leaders and Indigenous Services Minister Seamus O'Regan in February. The agreement provides $12.8 million for immediate action to address the community's housing crisis.

It includes $5 million to build 15 new homes, $2.1 million to repair and renovate 21 units and $3.1 million for new prefabricated modular housing units.

'I was the lead on the project'

Paulin was at the February meeting but did not attend the closed-door session where final details of the agreement were negotiated. However, he told CBC News that he was integral to securing the federal funding.

"I was the lead on the project." Paulin said. "I got it going from Day 1. I worked for 18 months getting that project up and running."

CBC news obtained a copy of Paulin's contract. It was signed by former Cat Lake chief Ernie Wesley. The contract states that Paulin's company, Windsun Energy Corp., "shall receive a consulting fee equal to 10% of all new monies brought into Cat Lake."

Paulin told CBC News that current Cat Lake leadership tried to terminate his contract on Feb. 26, five days after the meeting with O'Regan, but he says they have now agreed to pay him $1.2 million over several months.

Cat Lake First Nation Chief Matthew Keewaykapow, left, and Indigenous Services Minister Seamus O'Regan, right, reached a deal for emergency-housing money back in February. (Heather Kitching/CBC)

The money for Cat Lake housing did not go to the community directly. Instead, Indigenous Services Canada transferred the emergency funds to the Windigo Tribal Council, which represents several Indigenous communities in northern Ontario, including Cat Lake.

A department official, who spoke to CBC News on background, said Windigo has the technical expertise to facilitate the project. The official also said the department had heard concerns from members of the community and "other partners" about the role of consultants in the negotiation.

'Horrible situations'

Roseanne Archibald, who leads the Chiefs of Ontario, which represents all Ontario First Nations, worked as a consultant with Indigenous communities for nine years. She says she was paid a daily rate and did not take a percentage of the money she helped bring in to a community.

"There's a place for consultants to assist communities in specialized areas, but this is not one of those areas. This is like a mouldy housing, terrible crisis that happened to this community and I just don't think that third-party consultants need to be making money off of these kinds of horrible situations."

Residents of Cat Lake believe long-term exposure to mould is affecting the health of many people in the community. (Submitted by Charlie Angus)

Archibald said the situation is indicative of a bigger problem for First Nations communities who are struggling.

"If nations were receiving the funding and assistance they needed in terms of housing and basic infrastructure and those kinds of things then they wouldn't need to be hiring third-party consultants to address crisis situations."

The dollar amount here is not a typical amount. - Ramona Tkachuk, an independent auditor who manages finances for several First Nations

For his part, Paulin says he has a signed contract and has already done the work.

"I took the chance and worked for a year and a half for no regular pay. Zero. So the band understood that I was to be paid 10 per cent."

He also says he developed black mould poisoning while staying in the community. He says the condition has caused him respiratory problems.

'That's a lot of money'

Ramona Tkachuk, an independent auditor who manages finances for several First Nations in Manitoba and Ontario, said it's not unusual for third-party consultants to charge 10 per cent of new money they help bring in to a community. But such deals would typically involve much smaller sums, with payouts usually capped at $250,000.

"The dollar amount here is not a typical amount," she said.

"The next question is, where will [Cat Lake] get the money from? That's a lot of money for Cat Lake."

Paulin claims he wouldn't be paid from the emergency funding, but from the band's other sources of revenue. The band had $13.6 million in revenue in the fiscal year that ended in March 2017, so Paulin's fees would account for nine per cent of that.

Rita Wesley works as a health director for Cat Lake First Nation. She says Paulin deserves to be paid the money stipulated in his contract.

"If it wasn't for a voice like Jerry, I don't think we would have gotten to where we are today."

Paulin said he has worked as a consultant for at least eight First Nations over the years, but wouldn't say which ones.

In a statement, O'Regan's office said the government's "primary focus" has been "supporting the health and housing needs of families and community members in Cat Lake First Nation."

"Speaking broadly, any concerns regarding the misuse of funds are taken seriously and there are processes in place to look further into such concerns."