Canadian Indies Hold Breath For Factor

Canada's independent sector is nervously awaiting the renewal of federal government funding for the Foundation to Assist Canadian Talent on Records (FACTOR).

FACTOR, a major source of funding for Canada's indie sector, is set to expire March 31, 2005. The Toronto-based nonprofit organization distributes funding from the Department of Canadian Heritage and contributions from Canada's radio broadcasters to encourage the development of domestic talent.

It provides loans and grants to Canadian-owned or -controlled companies and to Canadian artists, songwriters and producers.

Since 1986, FACTOR has provided more than $71 million Canadian ($52 million) in funding support from both sources. The government's current contribution to FACTOR—under a one-year extension—is $8.1 million Canadian ($5.9 million). Sponsoring radio broadcasters have contributed $4 million Canadian ($2.9 million).

Canadian heritage minister Hélène Chalifour-Scherrer met with music-industry associations, artists and songwriters to discuss the funding issue during the annual Juno Award weekend in Edmonton, Alberta (Billboard, May 1).

During the Juno presentations, numerous artists—including Nettwerk's Sarah McLachlan—voiced support for FACTOR in acceptance speeches. FACTOR is a bedrock of Canada's music industry, and many artists have benefited from its financial support during the past two decades.

Asked in the House of Parliament April 21 if the government was willing to provide sustainable funding to FACTOR, Chalifour-Scherrer said, "This government remains very committed to Canadian artists, and I will ensure that they have the necessary tools to continue succeeding both nationally and internationally with sustained long-term funding."

Canadian music industry figures are encouraged by the minister's declaration—even if it was short on details.

Bernie Finkelstein, president of True North Records in Toronto, says, "The minister is clearly saying she and the government are committed to long-term funding. Given that the principal tool for [industry] funding is FACTOR, I think that's a commitment for long-term funding for FACTOR."

FACTOR chairman Jim West, who is also president of Justin Time Records in Montreal, agrees: "The key is long-term sustained funding."

FACTOR president Heather Ostertag adds, "It is great that the minister is in agreement with us, but many of her peers do not believe the music industry needs funding."

According to one government source, "People shouldn't worry about FACTOR not receiving money. The worst-case scenario would be that funding stays at the current level."

IMPORTANT ROLE

FACTOR was founded in 1982 by radio broadcasters CHUM, Moffat Communications and Rogers Radio Broadcasting, as well as the Canadian Independent Record Production Assn. and the Canadian Music Publishers Assn.

FACTOR's role grew significantly in 1986. That was when the Department of Communications (now Canadian Heritage) launched the Sound Recording Development Program. The initiative's aim was to assist in producing and marketing Canadian-content sound recordings, demos, music videos and syndicated radio programming, as well as international tours by Canadian artists.

Government funding—on an "ongoing" or permanently budgeted basis—increased 50% in 1997 to launch marketing, promotion and tour support programs.

In 2001, the government renewed its commitment to the recording industry by developing the Canadian Sound Recording Policy under the Canada Music Fund (CMF), which includes those support programs FACTOR administers.

However, CMF was rolled into a new three-year overall cultural program, Tomorrow Starts Today. This led to CMF—including those programs administered by FACTOR—being switched to "temporary" status and subject to annual federal cabinet approval.

The Department of Canadian Heritage is now preparing to submit a proposal to the federal cabinet for its Tomorrow Starts Today program, which, with its inclusion of FACTOR funding, expires March 31, 2005. Sources indicate that the department is trying to make the Tomorrow Starts Today program "ongoing," with funding being part of an annual budget.

However, set against the new Liberal government's fiscal priorities, sources say there will be cutbacks with the Tomorrow Starts Today program.

This threat spurred an independent committee of 20 Canadian music industry figures to launch the Save Canadian Music campaign in December 2003.

Contact information to lobby members of parliament is available to the public at savecanadianmusic.com.

But, Ostertag warns, "this government is looking for budget cuts, and we are vulnerable as an industry."