Does size matter? Apparently it does when it comes to film and TV production in Ontario.

Toronto, the giant, is seeing the number of Hollywood productions it is servicing shrink in the face of a high Canadian dollar and competition from as far away as Eastern Europe, while the number of smaller homegrown productions rolling in Ontario is up - but they are hitting the highway for Hamilton and Ottawa.

"I wish it were busier," laments Rhonda Silverstone, manager of the Toronto Film and Television Office. "It's kind of mind-boggling that we're not busier."

She says that statistics for 2006 will not be available until year-end, but it is evident from the lower levels of activity at her office, which issues local shooting permits, that it is shaping up to be a tough year. The slowdown is being felt despite the fact that New Line Cinema's Hairspray, starring John Travolta, is in preproduction, Sidney Kimmel Entertainment's Talk to Me with Don Cheadle recently wrapped, and the $75-million New Regency/Fox sci-fi flick Jumper is shooting until October.

Toronto has not been able to attract big-budget Hollywood movies on the scale that Vancouver has of late, and TV series production in the city has declined markedly.

"There is no doubt that it looks a little soft this year for foreign television shoots in Toronto," says Brian Topp, ACTRA Toronto executive director and co-chair of lobby group FilmOntario.

Ontario Media Development Corporation figures peg total production spending in the province at $933.8 million in 2005, down from $934.5 million the year before. In 2005, 41 foreign productions spent $458.8 million, down from the $486.3 million from 38 foreign projects in 2004. The foreign numbers are likely to fall further by the end of this year.

Industry leaders attribute the slowdown in Toronto to a higher Canadian dollar ($0.88 as of this writing), competition from other jurisdictions that have introduced their own tax credits, and the city's inability to overcome infrastructure shortcomings - particularly the fact that the FilmPort megastudio has yet to get off the ground. (It now has an opening date of early 2008.)

"One of the things that protected Ontario for so long was that, money-wise, you couldn't find a reasonable place to shoot [other than Toronto] that would double for Boston or New York," says Don Carmody, who has service-produced a number of Hollywood films in the city, including Assault on Precinct 13 and Chicago.

"But that's changing now," he adds. "Connecticut has introduced a tax credit that rivals Louisiana, and they can certainly double for New York and other places."

Topp and Silverstone echo these sentiments.

"There is no doubt that Ontario, which was a pioneer in the tax-credit game, got matched by many other jurisdictions ­- not just Quebec and British Columbia - but more than 40 U.S. states are in the game now," Topp notes.

Ontario's current tax-credit structure allows producers of foreign shoots in the province a credit of 18% on labor expenditures, while domestic productions qualify for 30%.