There was little to no discussion in the recent civic election on the issue of urban reserves, or as Mayor Katz likes to call them "economic development zones." Katz toured the urban reserve in Saskatoon and sang its praises declaring the playing field level. Sadly, Katz and other advocates of the urban reserve system, are wrong.

Thanks to a new VLT lounge to be operated by the Swan Lake First Nation which recently received reserve status for a parcel of land in Headingley, the issue of urban reserves is creeping closer to Winnipeg.

Since reserve status has been granted, the property is considered an Indian reserve subject to all the provisions contained within the Indian Act; such as freedom from taxation and the ability for a band council to pass by-laws that supersede local laws. Swan Lake is waiting for a thumbs up from the federal government regarding a request that would grant the Band authority to designate health policy, including designating smoking areas as they wish.

So not only will there be an un-level playing field on the tax front, if Swan Lake gets its green light from the federal government, there will be multi-tier smoking policy as well. Interestingly, this all comes on the heels of the provincial government's decision to appeal the August 2006 ruling by Manitoba Court of Queen's Bench Justice Albert Clearwater who struck down the smoking ban that exempted Indian reserves.

Under the Constitution Act of 1867, the federal government has exclusive jurisdiction of Indians and the lands reserved for the Indians. The Indian Act is the piece of legislation that governs the federal government's intervention.

That said, Section 88 of the Indian Act allows for all laws of general application in any province to be applicable to Indians in that province. There is, however, an exemption when the provincial law is in contravention of the terms of any treaty or any other Act of the Parliament of Canada.

It is because of Section 88 that the legislation and regulations of Manitoba Lotteries Corp. and the Manitoba Gaming Control Commission need to be adhered to in order for Indian bands to operate casinos or VLT lounges. But Swan Lake is using section 81(1)(a) of the Indian Act, which states native bands can pass by-laws "to provide for the health of residents on the reserve," to - ironically- keep smoking an option in their lounge.

So why the Mayor and the provincial government tout urban reserves as an equitable means by which to get natives working, is anyone's guess.

Further, urban reserves are placed beyond the reach of provincial and municipal real property, school and health taxes. Although native reserves enjoy the benefits of local police and fire protection, municipal water and sewer services, bands are not compelled to pay taxes to local governments.

Therefore, the citizens of Winnipeg will have no recourse should a native band operating an urban reserve decide not to pay for services contained within a "municipal service agreement."

In the meantime, Winnipeggers will watch the Headingley experience with great interest. But what will the urban reserve advocates do when the reality hits them that they are creating an un-level playing field