Fund purposes or outcomes are broad statements setting out what type of change the Fund will seek to achieve and therefore providing some overall parameters in terms of the types of projects or initiatives it will support. Ideally, these should be drawn from the headline themes or outcomes in the community action plan. This helps to evidence that the Fund Strategy is grounded in a wider plan for the community.
It is important to word the purposes / outcomes carefully, ensuring they give clarity about the change or difference that is desired. They should be broad enough to encompass the entire range of (permitted) activity that could bring about that change. If there are specific types of activity or projects that are desired, these can be set out further as priorities underneath each purpose or outcome. Anything that might contribute to the purpose or outcome but won’t be supported can be set out under ‘exclusions’ (see section 2.2 below).
Any particular purposes or priorities that the renewable energy business has a preference for will need to be considered too. These may be already set out in the Community Benefit Agreement the community has with them and are sometimes referred to as ‘Permitted Purposes’. Ideally, the themes emerging from the community action plan and any Permitted Purposes will overlap. Where there are exceptions, further discussion with the renewable energy business may be necessary.
It is also very useful at this point to know whether the renewable energy business wishes to have the Fund classed as a charitable donation for their own taxation purposes, and/or whether any community body or third party administrator who will hold and oversee the Fund has charitable status. Both instances will mean the Fund can only be used for charitable activity. This will have a bearing on the range of activity that can (and cannot) be supported by the Fund, and how the Fund purposes or outcomes should be worded. Guidance on what types of activity are deemed charitable is available at the Office of the Scottish Charity Regulator.
Bear in mind that community benefit funds, as long-term, flexible and non-statutory funding streams, are unique. They can therefore be used to catalyse sustainable income earning projects for communities. For example, community renewable projects or other enterprises that will earn income for the community. This requires the Fund Strategy to allow for investment in the initial, higher risk stage of such ventures and to reflect a long term and entrepreneurial mind-set as to what can be achieved. This kind of strategic opportunity and entrepreneurial thinking needs promoted and ideally embedded in the strategy at the outset.
