The deal, which has been pulled back from the brink of collapse several times, drew cautious optimism from some First Nations and protests from others when it was announced Friday.
Prime Minister Stephen Harper outlined details at an aboriginal high school in southern Alberta along with Assembly of First Nations national Chief Shawn Atleo.
"This is historic and it is a great day for Canada, for First Nations communities and for the next generation," Harper said. "But it is also long overdue."
The plan calls for standards consistent with provincial standards off-reserve. It also says students will have to meet attendance requirements and teachers will have to be properly certified.
But overall control is to remain with First Nations, Harper said.
He likened it to how local school boards operate elsewhere.
"We are talking about the kind of local control and response to local culture and history that we have in education across the country in most communities," he said.
Ottawa is to provide funding for core education, which includes language and cultural instruction, of $1.25 billion over three years starting in 2016. There's a provision for a 4.5 per cent annual increase. Another $500 million over seven years is to go toward infrastructure and $160 million over four years is set aside for implementation.
Atleo called the deal the beginning of a new era for First Nations children.
"Today is about ... fairness, opportunity and hope for First Nations children, youth and students," said Atleo.
A crowd of roughly 300 attended the announcement.
Discussions with First Nations on the deal were difficult from the get-go. Chiefs and grassroots membership, carrying brutal memories of residential schools, bristled at the idea of federal government involvement in their educational outcomes.
A year ago, Atleo nearly lost his job for working closely with Harper. Chiefs objected to Ottawa's approach and many demanded that Atleo walk away.
Outside the school Friday, nine protesters carried signs from the Idle No More movement. Inside, one woman briefly interrupted a ceremonial paddle-signing by Harper and the national chief.
Shannon Houle said she represented people of Alberta's Saddle Lake Cree Nation and of Treaty 6.
"We object to this agreement and I must make that public to let Canada know that not every First Nation has been consulted or has been part of these negotiations," she stood up and yelled.
Atleo took the interruption in stride.
"Your words are heard and respected," Atleo said. "What has been said here is correct. I am not the prime minister of Indians. My role is to support, acknowledge and respect that all First Nations have their rights."
Ontario Grand Chief Gord Peters was cautiously optimistic.
"We have some broad, general details about funding and First Nations to gain control of the education system," Peters said in a telephone interview. "Those are all nice buzz words, but I don't really know what they all mean.
"It's not until you actually get down and you start to hammer out what those things mean, do you actually get to that place of understanding what the process is going to end up looking like."
Graduation rates among First Nations children are among the lowest in Canada. Many communities see only half of high school students finish their basic education.
Part of the expectation in the deal is that aboriginal schools award widely recognized diplomas and certificates to students who do finish their schooling on-reserve. The government said this requirement does not currently exist and that has resulted in First Nations youth being turned away from jobs or post-secondary institutions, because they cannot prove their educational achievements.
It's a package that has been years in the making.
Harper's Conservative government had let slide a general aboriginal funding arrangement that had been brokered with First Nations by former prime minister Paul Martin's government in what was called the Kelowna Accord. Harper instead has focused his aboriginal policy primarily on education.
Within the federal cabinet, several ministers felt there was little political benefit to Harper continuing discussions.
As a last-ditch effort towards the end of last year, the Assembly of First Nations laid out several conditions for an agreement. Aboriginal Affairs Minister Bernard Valcourt made positive noises, which paved the way to Friday's announcement.
Jean Crowder, Opposition NDP aboriginal affairs critic, cautiously welcomed the announcement.
"The 4.5 per cent escalator clause will make providing a quality education more affordable for band councils. And we also welcome the announcement that there will be infrastructure dollars starting in 2015," she said. "However that will not close the gap of many First Nation schools in this country."
The Liberals were cautiously optimistic as well.
"Today's announcement is a positive step towards ensuring that every First Nations child receives a high-quality education in a First- Nations-led school system," MP Carolyn Bennett said in an email. "What was promised today by the government is the direct consequence of years of painstaking work by First Nations leadership, teachers, and Indigenous youth across the country."
The plan also got the backing of Mike Mahon, president of the University of Lethbridge.
"By supporting aboriginal education in the early, middle and high school years, students will have the necessary building blocks to realize success in the classroom," he said. "I hope that through this program, we will see many more First Nations students on our campus, empowered to make the most of their academic potential."
Also on HuffPost