ARCHIVED - Broadcasting Decision CRTC 2011-130

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Route reference: 2010-539

Ottawa, 25 February 2011

Newcap Inc.
Calgary, Alberta

Application 2010-0730-3, received 29 April 2010

CKMP-FM Calgary – Licence amendment

The Commission approves in part the application by Newcap Inc. to amend CKMP-FM’s condition of licence 3 related to Canadian content development. The new condition of licence is set out in the conclusion section of this decision.

Introduction

1. The Commission received an application by Newcap Inc. (Newcap) to amend the broadcasting licence of the English-language commercial radio programming undertaking CKMP-FM Calgary (formerly CFUL-FM) by amending its condition of licence 3 related to Canadian content development (CCD).

2. The condition of licence currently reads as follows:

3. In support of Canadian content development, the licensee shall contribute to the amounts set out below to the “Making of a Band” project, the Radio Starmaker Fund, and the “Summer Music Skills” project, as described in Broadcasting Decision 2006-323:

• Making of a Band: $8,333 in 2007, $173,761 in 2008, $555,953 in 2009, $610,000 in 2010 through 2013 and $391,953 in 2014;

• Radio Starmaker Fund: $450,000 in 2007 and 2008, $850,000 in 2009, and $350,000 in 2010 through 2013; and

• Summer Music Skills Clinic: $40,000 in 2008, $80,000 in 2009 and $40,000 in 2010 through 2013.

The amount that the licensee is required to contribute to Canadian content development under section 3(15) of the Radio Regulations 1986 is reduced by the amount that the licensee is required to contribute under this condition of licence.

3. Newcap requested flexibility to vary the specified amounts to be spent on individual initiatives by up to 20% per year so long as the required total amount is spent over seven consecutive broadcast years. In this regard, Newcap made a commitment to spend all CCD funds required under the condition of licence by 31 August 2014.

4. Newcap stated that it found it very difficult to time the expenditures on its Making of a Band initiative so that it could spend the correct amount during each broadcast year. It noted that the timing of its CCD expenditures is dependent on factors outside of its control, such as the coaching, touring and recording schedules of the artists involved.

5. The Commission received interventions in support of this application. The complete record of this proceeding is available on the Commission’s website at www.crtc.gc.ca under “Public Proceedings.”

Commission’s analysis and determinations

6. The Commission notes that Newcap did not fulfil the annual spending requirements for its CCD initiatives in 2007 and 2008. The total shortfall for those two years was $579,989. While the Commission’s general practice is to deny applications for licence amendments when a licensee is found in non-compliance, it is of the view that the non-compliance in this case is related to the way the condition of licence is structured and not the result of bad faith on the part of Newcap.

7. As well, over the last few years, the Commission has adopted a new approach to the way in which it sets out conditions of licence related to CCD. Conditions of licence now generally specify only the total annual CCD amount that must be expended, not the specific third parties that the licensee must support. This approach ensures that the licensee expends the required total amount while providing flexibility as regards spending on individual initiatives.

8. Newcap’s proposal generally reflects the Commission’s new approach as well as the commitments that the licensee made when licensed in that it would still be required to maintain its total CCD spending over seven years as well as the total amount that must be devoted to its Making of a Band initiative. However, the Commission considers that Newcap’s proposal to vary spending on this initiative by up to 20% poses difficulties with respect to auditing and measuring compliance.

9. Accordingly the Commission considers that it would be more appropriate to impose a condition of licence that requires Newcap to make a total annual contribution to eligible initiatives that would allow it to satisfy its total commitment to CCD, based on the amount still remaining to fulfil this commitment.

10. Given that Newcap’s contributions were proposed during a competitive process and its stated intention is to contribute to specific initiatives as originally imposed by condition of licence, the above-noted condition of licence would be accompanied by an expectation the Newcap meet its total commitments to individual initiatives, thus providing the licensee with a measure of flexibility.

Conclusion

11. In light of the above, the Commission approves in part the application by Newcap Inc. to amend CKMP-FM’s condition of licence 3 related to CCD. The Commission hereby replaces condition of licence 3 with the following:

For the 2010-2011, 2011-2012 and 2012-2013 broadcast years, the licensee shall make an annual contribution of $1 million to the promotion and development of Canadian content.

In addition, for the 2013-2014 broadcast year, the licensee shall contribute $391,953 to unfulfilled Canadian content development payments as set out in CFUL-FM Calgary – Licence amendment, Broadcasting Decision CRTC 2010-99, 19 February 2010.

12. The Commission further expects the licensee to fulfil its total CCD funding commitments to the specific initiatives identified in Adult Album Alternative FM radio station in Calgary, Broadcasting Decision CRTC 2006-323, 2 August 2006, including its total $579,989 CCD shortfall incurred as a result of its CCD shortfalls in 2007 and 2008.

13. The Commission will explore any issues related to non-compliance at the time of licence renewal.

Secretary General

Date modified:

2011-02-25