AES North Rhins Wind Farm Community Fund Memorandum of Understanding

January 2014

Memorandum of Understanding between:

Foundation Scotland And
Kirkcolm Community Council

Contents

Introduction
Context
Area of Community Benefit
Use of Funds
Distribution of Funds
Responsibilities of Foundation Scotland
Reporting
Modification
Complaints
Termination
No Intention to Create Legal Relations

Foundation Scotland

1 Introduction

This Memorandum of Understanding (MOU) is between Foundation Scotland (‘the Foundation’) and each Community Council (‘the Community Council’) involved in the AES North Rhins Community Fund. It sets out how the Foundation will implement the Fund on behalf of AES Wind Generation (‘the operator’).
The North Rhins Wind Farm became operational in 2010. It has an installed capacity of 22MW and is paying £1,173.75 per MW in community benefit, RPI linked, over the 25 year lifetime of the wind farm. Eleven community councils were selected to benefit from the Fund using Dumfries & Galloway Council Guidelines at the time of using a 15km radius from the wind farm to determine the area of
To date only six community councils are in receipt of community benefit from the Fund. The participating councils are Cairnryan, Kirkcolm, New Luce, Old Luce, Portpatrick and Stoneykirk. The other community council areas that are within the Area of Benefit are Castle Kennedy, Leswalt, Lochans and Ochtrelure &
Community benefit was originally administered by Solway Heritage in an arrangement where each community council submitted an annual plan to draw down on its share of income for the year ahead subject to AES Wind Generation’s approval. Solway Heritage ceased operating in 2011 and the distribution arrangement continued but was passed to Dumfries & Galloway Council to administer. In 2012 fund administration was passed to Foundation Scotland where it is a ring-fenced fund but continuing to support a wide range of projects within the Area of Benefit.

2 Context

The operator of the North Rhins Wind Farm has agreed to pay to the communities within the Community Benefit Area an annual sum for the benefit of the community for the operating lifetime of the North Rhins Wind.
The annual sum at year 1 was £28,000. The annual sum is index linked so increases each year.
The operator, by way of a separate agreement, has appointed Foundation Scotland to provide governance, grant making and administration services in relation to the Community Fund being provided. In this role, the Foundation can receive, hold and distribute the Fund.
The Fund is held and managed by the Foundation, subject to its Memorandum and Articles of Association. The Fund’s resources can only be used and distributed in accordance with this Memorandum of Understanding.
The Foundation is a registered charity (no. SC022910) dedicated to strengthening communities by awarding grants that make a genuine difference to the lives of local The Trustees of Foundation Scotland ultimately bear responsibility for how funds are distributed.
This Memorandum of Understanding is entered into with each Community Council, recognised in statute as the body that represents local interests. Where a Community Council does not exist within one of the eligible communities, Foundation Scotland can enter into this MOU with another local organisation deemed to be the representative body of local interests.

3 Area of Community Benefit

The Fund operates as a resource for the benefit of residents across the eleven eligible community council areas (the “Area of Benefit”).
At the time of writing six of the eleven eligible communities are in receipt of community funding from the Foundation.
Projects or services located outwith the Area of Benefit, or benefiting those other than residents of the prescribed Area may also be supported on a case by case basis within a Community Council’s Annual Plan, provided that there is a clear benefit to a material proportion of residents or otherwise recognised group of residents within the Area of Benefit.

4 Use of Funds

The Fund will support a broad range of community activity and development by primarily supporting the charitable activities of constituted, not-for-profit groups working to benefit residents within the Area of Kirkcolm.

This includes (but is not restricted to):

The promotion of sustainable development – which would include the promotion of energy efficiency measures, renewable energy schemes, sustainable transport options and a contribution to community acquisitions such as land or buildings.
The advancement of environmental protection or improvement.
The advancement of citizenship or community development (including rural or urban regeneration and the promotion of civic responsibility, volunteering, the voluntary sector or the effectiveness or efficiency of charities).
The advancement of culture or sciences.
The advancement of education
The advancement of public participation in sport and general physical activity

The Fund is not to be used to support the following:

The advancement of citizenship or community development (including rural or urban regeneration and the promotion of civic responsibility, volunteering, the voluntary sector or the effectiveness or efficiency of charities).
The advancement of culture or science.
The advancement of education.
The advancement of public participation in sport and general physical activity.

The Fund is not to be used to support the following:

The advancement of religion or party politics;
Activities understood to be the exclusive responsibility of statutory authorities;
Activities likely to bring the Foundation, the Panel, the Community Council, the Operator or any companies in its group or the local community into disrepute;
Anti-renewable energy/anti-wind farm activities;
Retrospective funding (i.e. paying for costs incurred before a decision on an application to the Fund for support was made).

Any unspent funds will automatically roll over to the next year. Whilst the current distribution arrangements continue, these unspent funds will be retained by the recipient community council and included in their distribution arrangements for the coming year.
Foundation Scotland will monitor balances and work with the community councils to ensure effective planning and distribution of balances.
Any balance remaining at the end of the operating life time of the wind farm will be distributed by Foundation Scotland in consultation with the local community councils or equivalents involved at the time and with the condition that any balance remaining is still retained for the original benefit area.
Distribution of Funds
Distribution of funds is currently through each Community Council that provides a plan of how it will spend or re-distribute its fund allocation.
To date each annual payment is divided equally between the participating Community Councils. If additional Community Councils engage with the Fund and the current distribution model continues, the level of funding allocated to each community council area will reduce as the annual RPI linked payment is fixed.
The distribution arrangements described at 5.1 and 5.2 could change at a later date but only in consultation with the local communities involved at the time. Any revised distribution arrangements will be informed by a community consultation and profiling process which Foundation Scotland would undertake with the support and engagement of local communities.
Responsibilities of Foundation Scotland

In supporting effective delivery of the Fund, Foundation Scotland undertakes to

Continue to implement the established arrangement for fund delivery of providing block grants to community councils for redistribution to local groups subject to approval of an Annual This currently involves liaising with Community Councils in producing Annual Plans (by mid October) and submitting it to the Operator for approval within a six week period (early Dec).
Issue reporting forms to each community council for the previous year’s spend to be submitted along with the proposed Annual Plan.
In the event that the Operator does not approve an Annual Plan Foundation Scotland will ensure the reasons are clear and will support the Community Council/s with the opportunity to submit a revised Annual Plan.
Meet with the community representatives in the first year of the new administrative arrangement to consider the benefits of developing a Panel for the Fund. This Panel would be a forum through which Annual Plans could be shared and learning from previous activity shared. The Panel could potentially also become a body which decides on grant awards at a future point, subject to any review of the current fund distribution arrangement (see below).
Work with the eligible communities to review the current distribution arrangements to ensure it is fit for purpose and achieving best impact for communities.
Provide a page on the Foundation’s website carrying information about the Fund.
Maintain all appropriate records concerning grants applied for and awarded.
Review, monitor and evaluate the work of the fund, compiling useful case study material that local organisations and the Operator can use and which will seek to reflect best practice.

7 Reporting

The Foundation is to provide reports regarding the distribution of funds to the Operator at least annually.
Community Councils will assist Foundation Scotland with the development of case studies, providing access to projects and stakeholders involved at the request of Foundation Scotland.

8 Modification of Memorandum of Understanding

Amendments or alterations to this MOU can be recommended at any time by any Community Council party to it or the Foundation. For a recommendation to be implemented and an amendment made, this is to require the approval of each community council as well as Foundation Scotland.

The terms of this Memorandum are to be reviewed by the Foundation every three years from the date of signing.

9 Complaints

If a participating Community Council or other local stakeholder has a complaint regarding the work of the Foundation, or its appointed representative, they are to contact Foundation Scotland’s Head of Community Investment. The Head of Community Investment is expected to respond to this complaint within four weeks.
If the Head of Community Investment fails to respond within this time, or adequately resolve any complaint, the complainant is to contact the Chief Executive of the Foundation Scotland, who is expected respond to this complaint within six weeks.
If the Chief Executive of the Board of Foundation Scotland fails to respond within this time, or adequately resolve any complaint, the complainant is to approach the Owner.

10 Termination of Memorandum of Understanding

The implementation of this MOU is dependent on the initial and continuing implementation of the separate agreement between the Foundation and the Owner. Should that agreement be terminated by either party, the terms of this Memorandum of Understanding are to cease to apply.
The Foundation is committed to ensuring the Owner, and any future owners, continue to meet their Community Funding obligation to the local community.

11 No Intention to Create Legal Relations

Tihs Memorandum of Understanding is a statement of intention in relation to the operation of the Fund and is not intended to create a partnership, joint venture or other legally binding relationship between any parties nor to constitute community councils or community councillors as trustees of the Fund.

For Foundation Scotland

Date

Signed

Name, Role

For Kirkcolm Community Council