It’s no exaggeration that most would-be producers in this country were left out in the cold prior to the emergence of the Canadian Television Fund in 1996.

‘Before the CTF, it was really tough,’ recalls Laszlo Barna, president and CEO of Toronto-based Barna-Alper Productions, who remembers series budgets of $50,000. ‘Drama and documentary were commissioned at a level that would have doomed the quality of Canadian programming.’

Previous options for producers included Telefilm Canada’s Broadcast Fund (created in 1984 with an initial budget of $254 million over five years), a variety of tax schemes, a broadcast licence, and perhaps a foreign sale to complete funding.

The CBC was particularly hungry, as it was reeling from major cuts from Parliament and had boosted Cancon on its primetime sked by dropping U.S. shows in the early 1990s.

‘We had a much greater demand for original Canadian programming. The creation of the fund was very welcome,’ says Marcela Kadanka, CBC’s senior director of TV arts and entertainment and a CTF board member from the beginning.

To producers across all genres, the CTF filled the financing gap.

‘Canadian producers could now fund programs entirely in Canada. This was quite revolutionary in its day,’ says Michael Hirsh, CEO of Toronto-headquartered Cookie Jar Entertainment, and at the time co-CEO of Nelvana.

The CTF began as a private enterprise called the Cable Production Fund, which administered the Licence Fee Program, driven by the Canadian cable industry. The feds stepped in, and in September 1996, then-minister of Canadian heritage Sheila Copps officially launched the Canada Television and Cable Production Fund, an annual $200-million public-private partnership that included Telefilm’s fund. The name was shortened to the Canadian Television Fund in 1998.

Its board drew from all stakeholder organizations, with a special seat for the CBC/SRC, which was mandated by the CRTC to receive the fund’s largest broadcaster share. Today, the board also includes seats for five members from Canadian Heritage, three from the cable industry, two from the CFPTA, four from the CAB, and one each from the APFTQ, ATEC, CAFDE and the direct-to-home satellite industry.

Bill Mustos, currently on sabbatical from his executive post at CTV, served as the fund’s first executive director, while Rogers Communications’ Philip Lind was chair of the board.

In its first year, the CTCPF relied on what has become a standard $100-million contribution from Heritage, $50 million from Telefilm and $44.3 million from Canadian cable companies (now under the umbrella of broadcast distribution undertakings and including the satellite sector), representing 1.5% to 5% of gross broadcasting revenues.

In 2005, BDUs put $127 million into the fund, while Telefilm added $38 million. The majority of that went to TV production, while feature films received $15 million, compared to $7.5 million at the start.

The birth of the fund wasn’t without its hiccups. The public-private partnership meant the administration of two disparate programs – the cable-driven LFP and Telefilm’s Equity Investment Program. The former was triggered by the latter, which was handed out on a selective basis as determined by Telefilm’s creative analysts.

Oddly, though, the money was awarded on a first come, first served basis, which led to bizarre scenes like the one you’ll likely see outside your local Best Buy with the launch of the PS3 gaming system.

‘In the old days there were lineups, with people sleeping in front of the CTF office [the night before a deadline],’ Barna recollects.

A few years of midwinter tailgate parties led to a market demand system in 1998, and then a broadcaster priority system in 2003, whereby casters would rank their shows in terms of importance and set specific licence fees. The CTF would then grade the projects’ viability. But since the EIP had a selective system, producers couldn’t count on money from both sides of the fund.

The domestic TV industry has relied heavily on the contributions of each of the CTF’s backers. A major panic spread among producers in 2003, when CTF president Sandra Macdonald had to face government cuts of $50 million over the following two years. But 13 months later, the feds in fact restored their $100-million annual commitment.

Ongoing dialogue between the CTF and the industry brought the introduction of Broadcaster Performance Envelopes in 2004, to many the watershed mark in the CTF’s evolution.

In contrast to the selective system, where decisions had to be made in mid-February or March, under the BPEs, broadcasters would be able to negotiate deals with producers throughout the year before allocating a portion of their ‘envelope’ to a project in a certain genre. The producer would then submit the funding application for the September or December deadlines.

Now the fund would hand out the LFP and EIP together, effectively ensuring that 20% of the production budget for eligible projects – and 25% for some big-budget drama series – would be covered by the licence top-up, while the balance of CTF-allotted money would come in the form of equity investment.

‘I think it was [spurred on by] the maturity of the industry,’ says Robin Mirsky-Daniels, executive director of Rogers Communications’ Group of Funds and CTF board member. ‘It was time broadcasters could choose among the projects that they really wanted, and not just be told what they got and what they didn’t get.’

Initially, the amount each broadcaster was allotted in its individual BPE was calculated solely by historical usage of CTF money, before an audience-tracking component was added. Then there was something called ‘leverage.’ If a broadcaster was making more programming with less CTF money, it got a bonus in the envelope adjustment. Another factor was how much the caster contributed to regional programming.

The main benefit of the BPEs is that they allow for industry decision-making throughout the year.

‘You’re able to rationally plan your life as an independent producer,’ says Barna, and broadcasters agree.

‘It’s a very good system, because it allows broadcasters to determine their own slates, so they can best serve their audiences,’ adds Kadanka. ‘Under the selective system, broadcasters were never sure which [shows] would make it through the system and which ones wouldn’t, so you couldn’t really plan your schedule effectively.’

Another hot-button topic of late has been governance. Can an organization have a board made up of self-interested parties? A report last year from Auditor General Sheila Fraser cited the CTF for ‘overly complex governance and lax application of its conflict-of-interest guidelines.’

True to form, the CTF, under present chair Douglas Barrett, also head of equipment supplier PS Production Services, responded to the Fraser report with changes. He added a ‘double majority’ system in the voting process and deemed that a certain number of board members have to be independent – i.e. not members of stakeholder organizations.

‘There isn’t any one person who rules the board, or one vote that has more sway than any other,’ insists Mirsky-Daniels. ‘It’s a collective vote that makes the decisions.’

Along with expanding its board, the CTF launched a renewable three-year service agreement with Telefilm this year, farming out the administration of its programs. The new partnership allows the CTF to concentrate on developing and implementing broad policy objectives.

‘The rationale was that we had two components of the same pool of private-public dollars that were being administered by two organizations,’ says Dave Forget, director of Telefilm’s television business unit, which saw its fulltime staff double from 30 to 60 with the added responsibility.

‘We’re not reinventing what we’re doing here, which is financing television production,’ says Forget, who has seen nearly 600 applications come through the doors of Telefilm’s regional offices in Toronto, Montreal, Vancouver and Halifax since the transition. ‘The program is very similar, although we’ve tried to improve the practice.’

Forget sits in on a management group with CTF that meets once a week in order to get Telefilm’s point of view about the impact of the deadlines.

‘We’re not [involved] in the policy design, but we’re certainly in the feedback business. And what we’re experiencing on a day-to-day basis is information that’s invaluable to the CTF.’

As the CTF looks to its next 10 years, the challenges it faces are strikingly similar to those when it began. Incumbent president Valerie Creighton, who left her post as CEO of SaskFilm to assume her new role at the beginning of this year, recently traveled across Canada to meet with stakeholders to address both recent changes and future directions.

According to Kadanka, the biggest challenge to Canadian TV remains competition from U.S. shows.

‘What we’re trying to achieve with the CTF is to really maximize the potential for success of Canadian television,’ she says. ‘The environment out there is constantly changing – technologically, socially, the business. It’s not static.’

While Mirsky-Daniels points out that the CTF has grown because the contribution from cable and satellite companies has grown, approaching the Harper government for more CTF money could be a slippery slope.

While government funding of $120.4 million is in place in 2006/07 – an increase marked by a transfer to Heritage of Telefilm’s historical investment – Heritage tells Playback that a decision regarding its future involvement ‘will be made in due course.’

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