February 14, 2012
The federal regulator has not ruled out reducing or eliminating the fund, which was worth $106 million last year. It comes out of a 1.5 per cent charge to cable and satellite bills.
More than 15,000 people completed the questions, said Cal Millar, Channel Zero president.
Millar doesn’t think the CRTC will eliminate the fund but he’s concerned the agency has opened the door to that possibility at all. The station will make its case directly to the commission at a hearing beginning April 16.
Millar says Channel Zero will argue that LPIF money received has gone directly into improving the quality and quantity of local news coverage.
“The LPIF has been very good for Hamilton and area … I think we have improved local programming and some of that is because of money received from the fund.”
He says the station sends out 32 news teams in two shifts each day and begins its local programming at 4 a.m. The station broadcasts 80 hours of in-house content a week, more than 11 times what it is required to produce.
Losing any of the LPIF could lead to reduced staff and programming hours or higher advertising rates, says Millar.
But he stresses that getting less money or no money at all from the fund won’t put CHCH in jeopardy.
“We would soldier on and continue our commitment to the community but it is an important part of our overall funding mix … A reduction would have an effect, but we’re not going to fall apart.”
Millar won’t reveal how much the station gets out of the fund, saying CHCH is privately owned and the dollars don’t come out of taxes. The CRTC also doesn’t disclose amounts paid to individual stations, but 26 stations across the country, including 20 owned by the CBC, have agreed to disclose their LPIF payments, which total $48.2 million.
They range from $4.5 million to the CBC’s affiliate in Quebec City down to $801,236 paid to CHEM in Trois-Rivieres.
The fund is paid based on a complex formula dividing Canada’s English and French markets that takes into account average spending on local programming for each station.
“CHCH is kind of like the poster child for the whole LPIF program in Canada,” said Ian Morrison, spokesperson with Friends of Canadian Broadcasting, an independent watchdog.
“I believe CHCH is just a remarkable new model in our broadcasting system.”
He estimates CHCH is getting somewhere between $1 million and $2 million from the LPIF.
Morrison thinks the CRTC will keep the fund in place but tighten its requirements.
There are 78 LPIF recipients, including some big players such as Bell and Rogers which both pay into the fund as a distributor and withdraw from the fund as the owners of small market stations. For instance, Bell (which owns CTV), paid $22.5 million into the LPIF but was paid $23.6 million out of it.
In upcoming hearings, LPIF recipients will be expected to demonstrate to the commission how the funding was used to improve viewer satisfaction and audience size, increase ad revenue, increase local news stories and grow local programming.
The fund was established in 2008, when a number of major broadcasters, including Canwest and CTV, were warning they could no longer afford to produce local content, and were cutting staff and letting broadcast licences expire. The CRTC said it would review the fund after three years.
Millar says there is no compelling reason to significantly alter the LPIF since the profitability of cable and satellite providers continues to rise and consumers have not protested paying the extra charge.
The CRTC initially demanded the cable and satellite providers pay the LPIF charge directly out of their own revenues but hasn’t enforced that.
“Now they’re just passing it on to their customers,” said Morrison. “They are not paying a penny … They love to raise fees when they get to keep the money.”