Toronto's Pride Week may be in danger of losing a public funding grant after a controversial anti-apartheid group said it would apply to march in the high-profile parade.

Queers Against Israeli Apartheid (QuAIA) has confirmed that it intends to rejoin the July 1 parade after skipping last year's event.

The group agreed not to march in 2011 after the city threatened to revoke a municipal grant over their inclusion. A QuAIA spokesperson said at the time that they did not want to give Mayor Rob Ford a pretext to cancel the event's funding.

QuAIA opposes Israel's treatment of Palestinians and city administrators said public money should not be spent to give their views a forum.

The group first marched in the Pride parade in 2010, stirring debate about their inclusion that led to a change in the way the city provided funding for Pride Toronto.

Pride organizers now receive the $123,000 grant at the conclusion of the 10-day event, so long as it hadn't violated anti-discrimination policies.

Groups have until June 1 to apply for a spot in the annual parade, the largest event during the internationally-renowned Pride celebration.

It is possible that the QuAIA's inclusion in the parade would again put the grant in jeopardy. City council will vote on whether to approve the grant next month.

Pride Toronto organizer Kevin Beaulieu said it was important that all communities felt included in the festivities.

He said they have established an arms-length panel to find resolutions between groups participating in the Pride parade, and have final say over which groups are allowed to march.

"Groups entering the parade sign off and agree to that process," Beaulieu told CP24. "And Pride Toronto itself agrees to that process, so that there is some deliberation and some due consideration, and a chance for these groups to be heard."

Pride Week runs from June 22 to July 1 and has a budget of about $1.5 million.