Facing lower project caps, broadcaster groups, instead of producers, will file the initial applications for ‘priority projects’ to the ctcpf Licence Fee Program in a one-time-only September application procedure that could potentially give priority to projects with the most private investment.

As reported in the last edition of Playback, only projects deemed first priority by a broadcaster group will be eligible. An example of a broadcaster group would be Baton/ctv, which between its network of 24 local stations and five specialties is eligible to select one priority project.

Broadcaster groups must identify their priority project after Aug. 17 and no later than Aug. 31 with a ‘broadcaster priority registration form’ obtained from the lfp. Once a broadcaster has submitted this form, the priority project cannot be replaced. No broadcaster may identify both a priority drama project and a priority documentary project.

After the broadcasters have made their submissions, producers of priority projects will be called by the lfp and told to submit their full lfp application.

While lfp top-up and bonus levels will remain unchanged, the maximum lfp amount for any dramatic or children’s program (including series) is now $720,000, down from a maximum of $3.5 million per project. But because no returning series are eligible for this tranche of lfp, the significant decrease is expected to have little impact as the maximum lfp is usually only accessed by distinctly Cancon drama series from the regions with 22 or more episodes.

The maximum lfp for documentary, performing arts or variety programs is now $180,000.

New screens and ranking system

In the event that the request level of priority projects exceeds the funding available, three ‘screens’ will be used to further reduce the field. Children’s and drama projects will be screened separately from documentary, performing arts and variety.

Screen one stipulates that the project achieves 4/5 of the lfp distinctively Canadian criteria, while screen two ensures that the project will air in primetime.

Screen three, if necessary, stipulates that drama, children’s and documentary projects are 5/5 distinctively Canadian criteria, while variety projects must be 5/5 and use all Canadian performers. For performing arts projects, programs must be 5/5 lfp distinctively Canadian criteria and achieve 10/10 Canadian content points.

If the projects which pass through all three screens exceed the available funds, then those projects will be ranked according to the new ranking system.

Each project will be ranked according to the percentage of ‘at risk’ private dollars in that project’s financing structure, not including the proposed lfp and broadcaster threshold licence fee amount required by lfp guidelines. Projects with the highest amount of ‘at risk’ dollars will be given priority, thus the project with the greatest amount of private investment will be ranked first.

‘At risk’ dollars has been determined by the lfp to include cash equity investment from the producer, a third party or a public or private broadcaster; any excess cash licence fee over threshold paid by a Canadian private or public broadcaster; third-party distribution advances or revenue guarantees; third-party service and deferrals; and sponsorship.

‘At risk’ dollars will not include federal or provincial government investment or grants, federal and provincial tax credits, monies received from a private or public fund; producer deferrals; or broadcaster facilities or services.

If all the projects that pass the three screens do not exceed the funds available, then funds will be reserved for those projects, payable upon successful completion of the phase one and two reviews. Any funds remaining would be distributed amongst those projects which passed through two screens, with the distribution of the funds based on the ranking of those projects.

No company caps

There are no caps, however, as to how much lfp funding one company can access within the new guidelines. There is nothing to prevent one company from accessing all or a large amount of the lfp funds, should broadcasting groups choose a high number of that company’s projects as a priority. The ability of the larger public companies to dominate the lfp has been a recent concern of smaller production companies which have lobbied for company caps.

Phil Serruya, manager of communications at the lfp, acknowledges that there is nothing in the guidelines to prevent such a scenario, but says that the lfp has had discussions with broadcaster groups and that it doesn’t appear that any one company will ‘scoop’ the fund.

The September lfp application period will now begin on Sept. 28, rather than on Sept. 15, so as not to conflict with the Toronto International Film Festival and the crtc hearings.

However, projects which apply to the September tranche (worth $7.2 million in total – $4 million English, $3.2 million French, both 80% reserved for drama and children’s, and 20% reserved for variety, doc, performing arts) may commence principal photography on or after Sept. 15.