Screen Australia’s letters of interest to be more useful as a financing tool

These letters signal that the government agency is seriously interested in investing in the film – which can make other potential investors take notice — but producers can only apply now if they already have a deal memo from a local distributor and an international sales agent attached.

Under the new guidelines only a “firm” letter of interest from a domestic distributor is required for Screen Australia to make a decision on a film’s potential, meaning that it will be possible to get a stamp of approval much earlier in the financing process and before deals are locked down.

“Under the current system the criteria to get a letter of interest is almost as onerous as getting production finance,” head of development Martha Coleman told ScreenDaily. “Letters of interest will be working harder and will be more of a tool for producers in the marketplace.”

She rejects the notion that the changes give her department more “power”, emphasizing that the intention is to help the filmmaker, but clearly, creative potential will now being considered earlier, although audience and market appeal, track record and so on, are implicit in decisions.

Currently letters of interest expire after 12 months; five have lapsed since Screen Australia’s establishment in 2008. Technically, letters of interest will not expire in future. As now, letters of interest will not guarantee investment finance.

With the bar being lowered in terms of requirements — but not quality — it is unknown whether more will be issued.

“It is important that their value is not diminished by being cavalier … Producers have to be very considered when applying because of the two-strikes-and-you’re-out rule. We don’t have the resources to keep assessing (the same projects).”

There will be more flexibility for the cast, financing partners and others to have input under the new rules because letters of interest currently act more like a creative sign-off.

Coleman and head of production investment, Ross Matthews, will make the final decision on letters of interest.

Some changes are also proposed to the second and final step in securing Screen Australia investment. The board will be able to make decisions more quickly, for example, by considering features at eight board meetings per year from July, instead of four.

In future, Coleman, Matthews and one of Screen Australia’s two external part-time feature film consultants, will formally meet with all applicants before coming to a decision. The contracts of the two existing consultants, Victoria Treole and Matthew Dabner, are up this month.

The conditions of having a sales agent attached and not exceeding the investment cap of $2.66m (A$2.5m) continue to apply.

In 2010/11 Screen Australia invested nearly $24.4m (A$22.9m) in 17 features. The figure will be similar in the current financial year.