Managing community funds

This guidance has been developed in association with

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DTA Scotland

DTA Scotland is a member-led organisation with a board of directors elected from its membership and a small staff team based around the country.

DTA Scotland’s vision is to have a successful development trust in every community that wants one.

Through the provision of information, resources and a variety of direct contact, DTA Scotland assists interested communities to explore the benefits and relevance of the development trust approach. It also provides useful resources, training and limited support to communities wishing to establish a development trust.

DTA Scotland facilitates learning and development through networking opportunities including an annual conference, a programme of training seminars and the provision of funding to resource visits between members and potential members. In addition, staff provide advice, bespoke training opportunities and regular information on opportunities and resources. Once established, member development trusts can access a wide range of benefits and many useful resources, including a regularly updated funding guide.

Foundation Scotland

(formerly Scottish Community Foundation)

As an intermediary body supporting communities and developers to manage community funds, Foundation Scotland has developed models of practice to assist with the recruitment and selection of a local assessment panel. In general, community councils have a designated place on the panel and the remaining members are recruited from the wider community.

Community members can be nominated or put themselves forward to the local panel, allowing membership to reflect the broad interests of a local community and not be perceived as the ‘usual suspects’. Community councils are encouraged to lead on a process for recruitment which is open, transparent and publicly available.

Guidance is provided on the pros and cons of the preferred nomination process which can range from an open public meeting to a closed ballot. Community members are encouraged to consider and share what they feel they can bring to a panel. Should there be more people than places, the skills and experience of applicants will assist with the selection process to bring a mix of experience to the panel.

Panel members generally serve for between one and three years and the identification of new panel members follows the same recruitment process.

Community Energy Scotland

Community Energy Scotland grew out of the Highlands and Islands Community Energy Company (HICEC), formed in 2004 as a subsidiary of Highlands and Islands Enterprise. Building on HICEC’s success, and in response to a growing sustainable development agenda in Scotland, it is now an independent charity covering all of Scotland.

A grant fund was created to support the development of revenue-generating community renewables projects. This grant fund was superseded by the Scottish Government’s CARES grant and loan programme and HIE’s Community Renewable Energy Support Programme. CES has supported over 1,000 community groups.

CES administers the Scottish Government Register of Community Benefits from Renewables, a public register which includes details of community benefits agreed with renewable energy developers across Scotland. The Register provides examples of in-kind benefits, fund management and spend, and can help prospective benefitting communities in setting up community benefits with developers. Alongside this, Community Energy Scotland has developed the Community Benefit Guidance Package on behalf of Scottish Government. This tool is designed to help communities and commercial developers work together to maximise the potential benefits from renewable energy developments. Both are hosted on the CES website.

Social Investment Scotland

Social Investment Scotland (SIS) are Scotland’s largest not-for-profit provider of loans and other repayable investments to communities across Scotland. As well as a portfolio of investments, SIS also has experience of managing funds on behalf of third parties. For example, since 2008, SIS has managed the £31.8m Scottish Investment Fund on behalf of the Scottish Government.

Using loan funding as an option for community projects the money can be invested again

Although running a loan fund is not necessarily complicated there are many important factors to consider, including assessing loan applications, monitoring loan performance and loan processing (including release of funds, loan repayments, production of statements and portfolio reporting). SIS can support communities to develop loan fund propositions, on a fund management or consultancy basis.

Loan finance has been proven to have a positive impact upon the organisations that take it on - not only through the social impact created but by helping to make organisations more sustainable, more enterprising and better run.

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