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The federal government is being asked to take over a Manitoba First Nation where teachers say their paycheques have bounced, retirees can't get access to their pensions and those who are ill can't get disability benefits.

The Manitoba Teachers' Society says Ottawa should appoint a third-party manager to address chronic financial problems at the Sandy Bay reserve. Lawyers for the union have submitted a detailed package to Aboriginal Affairs and Northern Development Canada to support the request.

"The situation for our members in Sandy Bay has become worse than intolerable," society president Paul Olson said Tuesday.

The union alleges the First Nation has defaulted or delayed paying its teachers many times over the last 18 months, forcing some to miss mortgage and loan payments.

The reserve has been deducting pension contributions, insurance and employment premiums, but Olson said that money hasn't been passed on to insurance companies or to the Canada Revenue Agency, leaving teachers without coverage.

"All the deductions have been made. 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 55 teachers on the reserve are owed a total of at least $737,000, Olson said. To make matters worse, conditions at the school are deplorable with broken fire alarms and bathrooms without toilet paper, he added.

Chief Russell Beaulieu declined to talk about any of the allegations. He said he was planning to hold a news conference Wednesday.

"I need to update myself on these accusations so I'm preparing myself overnight," he said.

An Aboriginal Affairs spokeswoman said the department would not provide someone to respond in an interview, but was working on an emailed statement.

Mike Beaulieu, whose father founded the Sandy Bay school Beaulieu has been teaching at for 23 years, said the situation is heartbreaking.

Every payday, he said, speculation starts about whether cheques will actually be issued. Beaulieu said payment has been delayed many times and teachers were told if they wanted to be paid on time, some of them would lose their jobs.

"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," he said, his voice shaking with emotion. "If it wasn't for the students in my care, I don't know if I could stay there."

Marlene Lavasseur said she couldn't afford to stay. The special education teacher quit her job last summer after two of her pay cheques bounced. Many more were delayed making it hard for her to pay her rent, she said.

"I had to make that decision just so I could survive," said Lavasseur, who is supporting two children and three grandchildren. "It was hard for me knowing that I wasn't going to be able to see these students again. But it was that or put myself in danger with my health and the stress levels I was experiencing."

Sandy Bay First Nation is currently listed as being under co-management, which means it has hired an adviser to help with its books. But the teachers' union said it's been told that the reserve is "between co-managers" at the moment.