One of these things, as they sang on Sesame Street, is not like the other ones. Rebel News runs wild conspiracy theories while its “personalities” accost federal ministers in public, sometimes getting themselves arrested. Its content is mostly alt-right political propaganda. Narcity publishes blogs in major cities across North America that tell you about interesting places to visit, things to do and restaurants to try. It is classic clickbait. KelownaNow is a local news website that helps to keep residents of BC’s third-largest metropolitan area informed. It is chock full of public safety announcements, road closures, product recalls and celebrity sightings.

They all have one dubious distinction in common—all have been denied status as a so-called Qualified Canadian Journalism Organization eligible to claim payroll tax credits from Ottawa’s $595 million news media bailout, which was announced in 2019 and was recently extended until 2029. They will also thus likely be unable to receive payments from Google’s promised $100 million annual contribution to Canadian media under the Online News Act. While publishing propaganda or clickbait is understandable as grounds for disqualification as a QCJO, distributing as much local news as possible is what the media bailout and the Online News Act are supposed to encourage. Why KelownaNow has been denied support for doing so is a bit mystifying and spotlights an issue that has flown under the radar due to federal secrecy surrounding the bailout. This lack of transparency flies in the face of promises made by then-Heritage Minister Pablo Rodriguez in 2019 that “the whole process will be public,” and that “everything will be transparent.”

Because the bailout was provided as tax credits, however, a cone of silence has descended around the whole process. I queried both the chair and vice-chair of the Independent Advisory Board on Eligibility for Journalism Tax Measures, which assists the CRA in deciding whether an applicant for the tax credits practices journalism or not, but I received only an emailed statement from a CRA spokesperson. “The confidentiality provisions of the Income Tax Act prevent the CRA from discussing taxpayer information,” it read. “This includes commenting on organizations that have applied for, received, or been denied qualified Canadian journalism organization designation.” There is no list of QCJOs, but there is one of 188 qualifying digital news subscriptions which are publications by QCJOs that have a paywall you can thus subscribe to and get a 15 percent tax credit that maxes out at $75. There is also a list of the dozen or so RJOs, or Registered Journalism Organizations which are both non-profit and have been granted charitable status by the CRA and can thus issue tax-deductible receipts for donations.

Rebel News has made no secret of its battle with Ottawa over QCJO status, running regular updates and even fundraising on its fight that is now before the Federal Court of Canada. The pugnacious publication, which was founded in 2015 by refugees from the failed right-wing Sun News Network, was denied QCJO status by the CRA in 2022 after its Advisory Board found that “less than one per cent of Rebel News articles met the criteria for original news content.” Canadian Dimension chronicled recently how Rebel News picked up a mistaken report and turned it into full-blown fake news of election interference.

Narcity is aimed at Millennial and Gen Z readers who have disposable income and are looking for things to spend it on. “Regardless of the format—whether it’s an announcement, travel listicle or opinion piece—our stories are designed to be creative and digestible, offering a unique perspective that stands out from the traditional media landscape,” it explains on its website, which refers to its “creators” and “storytellers” rather than journalists. It was founded in 2013 as MTL Blog and was renamed Narcity in 2016 when it expanded across Canada. It has since gone international, with websites serving Dallas, Miami, Atlanta, Houston, Austin and Savannah, Georgia. Narcity cheekily flipped the script on the CRA’s decision to deny it QCJO status by successfully petitioning Meta recently for reinstatement to the company’s social media platforms.

KelownaNow, on the other hand, not only cannot collect subsidies but is also still banned from Facebook and Instagram like most other Canadian news media. It was denied QCJO status after a review by journalism professor Colette Brin, who chairs the CRA’s Advisory Board, found that less than 10 percent of the news published by KelownaNow and its sister publications in nearby Penticton and Kamloops was original, with many stories being copied from press releases. It’s a charge hotly denied by its managing editor Iain Burns, a veteran of Fleet Street with the Daily Mail, who explained that like many online news media it will post such source material “quite hastily,” but that is hardly the end of the story. “The fact we often follow up those quick stories with in-depth interviews and video stories seems to have passed her by,” he said. The CRA spokesperson said that there is no set amount of original news content required to be produced by a QCJO. “An organization is considered to be engaged in the production of original news content where it demonstrates a commitment to producing original news content on an ongoing basis.”

That’s exactly what KelownaNow does, according to Burns. “We do carry rather a lot of news,” he said. “We often set the news agenda in BC, as it happens, with our exclusive interviews, including of political leaders. We’ve also, as funny as it might sound, set the national news agenda a number of times (if only for a short while) with our coverage of, for example, wildfires, as well as interviews with the likes of Pierre Poilievre and Pascale St-Onge.” Burns leads a team of journalists that includes veterans Kent Molgat, a former head of CTV’s Kelowna bureau and Steve MacNaull, a former business editor at the Kelowna Daily Courier.

A fruit growing and recreational centre on Okanagan Lake in the southern interior of BC, Kelowna’s population recently passed 250,000. It is hardly a news desert with not only a daily but also a weekly newspaper in the Kelowna Capital News, a half-dozen radio stations, a Global Television affiliate and several online publications. KelownaNow has been publishing since 2014 and in addition to serving Penticton and Kamloops, which recently lost its last newspaper, it recently expanded to Prince George in BC’s northern interior and the capital of Victoria. Burns notes that being unable to collect the news subsidies has cost it “many hundreds of thousands of dollars” and forced it to cut back on staffing in those outposts. It also puts KelownaNow at a disadvantage with its online competitors, especially Castanet, which has been publishing since 2000 and was bought in 2019 by Vancouver-based chain Glacier Media for $22 million. Even Castanet’s director of content agreed that the situation has created a tilted playing field. “It is a bit odd,” said Colin Dacre. “I think they should have been approved.” Burns said that KelownaNow plans to appeal to the CRA again, this time with testimonials from the City of Kelowna, its mayor, leaders of BC’s political parties and area MPs. He added that it has also petitioned Meta for reinstatement to its platforms, as Narcity did, but has so far received no response.

Marc Edge is a journalism researcher and author who lives in Ladysmith, BC. His books and articles can be found online at www.marcedge.com.