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JESSICA
Fund
The Scottish Government
has signed a funding agreement with the European Investment
Bank (EIB) to establish a new £50 million fund to support
urban regeneration in Scotland.
What
is the funding for?
JESSICA
(Joint European Support for Sustainable Investment in City
Areas) has been developed by the European Commission and the
European Investment Bank (EIB), in collaboration with the
Council of Europe Development Bank.
It allows the use of some of the ERDF (European Regional Development
Fund) grant allocation as a source of loans, equity investment
and guarantees that, alongside complementary resources from
the EIB and others, will help de-risk developments in regeneration
areas currently considered too marginal for commercial lenders
or investors. A range of activity that directly supports employment
can be supported through JESSICA; along with measures to support
growth industries, such as renewable energy.
Benefits of JESSICA
The fund has the potential to lever in additional sources
of public and private investment; and to create a sustainable
fund to support regeneration activity in Scotland well into
the future.
The underlying principle is to use ERDF to invest in projects
with the expectation of a return on the investment, rather
than following the traditional grant approach that allocates
ERDF funding with no expectation of repayment.
JESSICA allows the investment of ERDF and Scottish Government
cash - in the form of equity, loans and/or guarantees - in
a way that creates a commercial return. This return can then
be re-invested into new urban development projects that will
create further cash for new projects. An evergreen fund of
this type would leave a lasting legacy to support regeneration
and economic development throughout Scotland beyond the end
of the current Structural Funds programme in 2013.
JESSICA can be
applied to projects in the 13 local authority areas currently
eligible for ERDF support (Clackmannanshire, Dundee, East
Ayrshire, Edinburgh, Fife, Glasgow, Inverclyde, North Ayrshire,
North Lanarkshire, Renfrewshire, South Lanarkshire, West Dunbartonshire,
West Lothian).
Further details
can be found http://www.scotland.gov.uk/Topics/Built-Environment/regeneration/jessica
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