ARCHIVED -  Decision CRTC 99-184

Decision

Ottawa, 21 July 1999

Decision CRTC 99-184

Affinity Radio Group Inc.

St. Catharines, Ontario - 199813332

14 June 1999 Public Hearing
National Capital Region

Acquisition of the assets of CHRE-FM

1.  The Commission approves the application for authority to acquire the assets of CHRE-FM St. Catharines from Redmond Broadcasting Inc., and for a broadcasting licence to continue the operation of this undertaking.

2.  The Commission will issue a licence to Affinity Radio Group Inc. (Affinity), expiring 31 August 2003, (the current expiry date), upon surrender of the current licence.

3.  The total purchase price relating to this transaction, including adjustments, is projected to be $7.3 million at closing. Based on the evidence filed with the application, the Commission has no concerns with respect to the availability or the adequacy of the required financing.

4.  Affinity currently owns two other commercial radio stations in St. Catharines, namely CKTB and CHTZ-FM. Through this transaction, Affinity will own three commercial radio stations in the market. This application falls within the scope of the policy on the common ownership of radio stations established in Public Notice CRTC 1998-41, Commercial Radio Policy 1998. According to this policy, in markets with less than eight commercial stations operating in a given language, a single licensee may own or control as many as three stations operating in that language, so long as no more than two of these stations occupy the same frequency band.

5.  In evaluating applications that would result in common ownership, the Commission requires applicants to address the issue of diversity of voices. Affinity made a commitment that each of its St. Catharines stations will continue to employ a separate senior news manager who will be independently responsible for decisions regarding editorial comment and news content. In addition, St. Catharines is served by numerous local and regional media outlets that provide a variety of news sources and voices. The Commission is satisfied that approval of this transaction will not negatively affect the diversity of news coverage offered to the community.

6.  Consistent with the requirements of the benefits test outlined in Public Notice CRTC 1998-41, the benefits offered represent the required minimum direct financial contribution to Canadian talent development of 6% of the final purchase price, currently projected to be $7.3 million. The benefits expenditures will be spent over five years. They include:

·  3% to be allocated to the Canadian Music Marketing and Promotion Fund, which is to be created;

·  2% as a contribution to FACTOR; and

·  1% to support an annual "pops" concert and a compact disc featuring the Niagara Symphony.

7.  The 3% contribution which is to be allocated to the Canadian Music Marketing and Promotion Fund must be directed to the Canadian Association of Broadcasters who will hold all contributions in trust pending the creation of this fund. These commitments are over and above CHRE-FM's existing commitments and conditions of licence.

8.  Notwithstanding its estimate of a $7.3 million purchase price at closing, Affinity made a commitment to adjust its 6% benefits expenditures to reflect the final purchase price. The Commission expects Affinity to advise it regarding the final purchase price. Should this price differ from the projected $7.3 million, the Commission expects the licensee to abide by its commitment to adjust its benefits expenditures accordingly.

Conditions of licence

9.  The licence will be subject to the conditions specified in this decision and in the licence to be issued. As conditions of licence, the licensee must:

·  not operate this station within the Specialty format as defined in Public Notice CRTC 1995-60 or as amended from time to time by the Commission;

·  broadcast, in any broadcast week, less than 50% hit material as defined in Public Notice CRTC 1997-42 dated 23 April 1997, as amended from time to time.

·  make payments to third parties involved in Canadian talent development at the level identified for it in the Canadian Association of Broadcasters' (CAB) Distribution Guidelines for Canadian Talent Development, as set out in Public Notice CRTC 1995-196 as amended from time to time and approved by the Commission, and to report the names of the third parties associated with Canadian talent development, together with the amounts paid to each, concurrently with its annual return. The payments required under this condition of licence are over and above any outstanding commitments to Canadian talent development offered as benefits in an application to acquire ownership or control of the undertaking;

·  adhere to the guidelines on gender portrayal set out in the CAB's Sex-Role Portrayal Code for Television and Radio Programming, as amended from time to time and approved by the Commission. The application of the foregoing condition of licence will be suspended as long as the licensee remains a member in good standing of the Canadian Broadcast Standards Council; and

·  adhere to the provisions of the CAB's Broadcast Code for Advertising to Children, as amended from time to time and approved by the Commission.

Employment equity

10.  The Commission notes that this licensee is subject to the Employment Equity Act that came into effect on 24 October 1996 (1996 EEA), and therefore files reports concerning employment equity with Human Resources Development Canada. As a result of a consequential amendment to the Broadcasting Act, the Commission no longer has the authority to apply its employment equity policy to any undertaking that is subject to the 1996 EEA.

Interventions

11.  The Commission acknowledges the three interventions filed in support of this application. The Commission also acknowledges the concerns expressed in the opposing intervention submitted by RB Communications Ltd. and is satisfied with Affinity's response.

This decision is to be appended to the licence. It is available in alternative format upon request, and may also be viewed at the following Internet site:
www.crtc.gc.ca

Secretary General