Scottish Local Authority Support for Culture, Heritage, Sport Recreation and Local Infrastructure (SC10295)

Legal Context

In terms of Section 20 of the Local Government in Scotland Act 2003, Scottish Local Authorities may provide aid to qualifying enterprises in  respect of culture, heritage, sport and local infrastructure .

Objectives of the Scheme

The objective of the scheme is to provide discretionary funding to support activities in the fields of:

a) Culture and heritage conservation;

b) Sport and Recreation; and

c) Local infrastructure.

Culture and Heritage Conservation - Eligible Activities

Scottish local authorities may give support for the following cultural purposes and activities:

(a) museums, archives, libraries, artistic and cultural centres or spaces, theatres, opera houses, concert halls, other live performance organisations, film heritage institutions and other similar artistic and cultural infrastructures, organisations and institutions;

(b)  tangible heritage including all forms of movable or immovable cultural heritage and archaeological sites, monuments, historical sites and buildings; natural heritage linked to cultural heritage or if formally recognized as cultural or natural heritage by the competent public authorities of a Member State;

(c) intangible heritage in any form, including folklorist customs and crafts;

(d) art or cultural events and performances, festivals, exhibitions and other similar cultural activities;

(e)  cultural and artistic education activities as well as promotion of the understanding of the importance of protection and promotion of the diversity of cultural expressions through educational and greater public awareness programs, including with the use of new technologies;

(f)  writing, editing, production, distribution, digitisation and publishing of music and literature, including translations.

Culture and Heritage Conservation - Eligible Costs

For investment aid, the eligible costs shall be the investment costs in tangible and intangible assets, including:

(a) costs for the construction, upgrade, acquisition, conservation or improvement of infrastructure, if at least 80 % of either the time or the space capacity per year is used for cultural purposes;

(b) costs for the acquisition, including leasing, transfer of possession or physical relocation of cultural heritage;

(c) costs for safeguarding, preservation, restoration and rehabilitation of tangible and intangible cultural heritage, including extra costs for storage under appropriate conditions, special tools, materials and costs for documentation, research, digitalisation and publication;

(d) costs for improving the accessibility of cultural heritage to the public, including costs for digitisation and other new technologies, costs to improve accessibility for persons with special needs (in particular, ramps and lifts for disabled persons, braille indications and hands-on exhibits in museums) and for promoting cultural diversity with respect to presentations, programmes and visitors;

(e) costs for cultural projects and activities, cooperation and exchange programmes and grants including costs for selection procedures, costs for promotion and costs incurred directly as a result of the project;

For operating aid, the eligible costs shall be the following:

(a)  the cultural institution's or heritage site's costs linked to continuous or periodic activities including exhibitions, performances and events and similar cultural activities that occur in the ordinary course of business;

(b) costs of cultural and artistic education activities as well as promotion of the understanding of the importance of protection and promotion of the diversity of cultural expressions through educational and greater public awareness programs, including with the use of new technologies;

(c)  costs of the improvement of public access to the cultural institution or heritage sites and activities including costs of digitisation and of use of new technologies as well as costs of improving accessibility for persons with disabilities;

(d) operating costs directly relating to the cultural project or activity, such as rent or lease of real estate and cultural venues, travel expenses, materials and supplies directly related to the cultural project or activity, architectural structures for exhibitions and stage sets, loan, lease and depreciation of tools, software and equipment, costs for access rights to copyright works and other related intellectual property rights protected contents, costs for promotion and costs incurred directly as a result of the project or activity; depreciation charges and the costs of financing are only eligible if they have not been covered by investment aid;

(e) costs for personnel working for the cultural institution or heritage site or for a project;

(f) costs for advisory and support services provided by outside consultants and service providers, incurred directly as result of the project.

Culture and Heritage Conservation - Aid Intensities

For investment aid, the aid amount shall not exceed the difference between the eligible costs and the operating profit of the investment The operating profit shall be deducted from the eligible costs ex ante, on the basis of reasonable projections, or through a claw-back mechanism. The operator of the infrastructure is allowed to keep a reasonable profit over the relevant period.

For operating aid, the aid amount shall not exceed what is necessary to cover the operating losses and a reasonable profit over the relevant period. This shall be ensured ex ante, on the basis of reasonable projections, or through a clawback mechanism.

As an alternative to the above, for aid not exceeding £850,000, the maximum amount of aid may be set at 80 % of eligible costs.

The maximum aid granted may not exceed £85 million per project in respect of investment aid: in the case of operating aid this may not exceed £42.5 million per undertaking per year.

Culture and Heritage Conservation - Exclusions

Aid to press and magazines, whether they are published in print or electronically, shall not be eligible for support.

Sport and Recreation - Eligible Activities

Scottish local authorities may provide assistance for sport and multifunctional recreational infrastructure on the basis detailed below:

The aid may take the form of:

(a) investment aid, including aid for the construction or upgrade of sport and multifunctional recreational infrastructure;

(b) operating aid for sport infrastructure;

Sport and Recreation - Eligible Costs and Aid Intensities

For investment aid for sport and multifunctional recreational infrastructure the eligible costs shall be the investment costs in tangible and intangible assets. (Multifunctional recreational infrastructure shall consist of recreational facilities with a multi-functional character offering, in particular, cultural and recreational services with the exception of leisure parks and hotel facilities)

The aid amount shall not exceed the difference between the eligible costs and the operating profit of the investment. The operating profit shall be deducted from the eligible costs ex ante, on the basis of reasonable projections, or through a claw-back mechanism

For operating aid for sport infrastructure the eligible costs shall be the operating costs of the provision of services by the infrastructure. Those operating costs include costs such as personnel costs, materials, contracted services, communications, energy, maintenance, rent, administration, etc., but exclude depreciation charges and the costs of financing if these have been covered by investment aid.

The aid amount shall not exceed the operating losses over the relevant period. This shall be ensured ex ante, on the basis of reasonable projections, or through a claw-back mechanism,

For aid not exceeding £850,000 the maximum amount of aid may be set, as an alternative to the method referred to above, at 80 % of eligible costs.

In the case of investment aid this may not exceed £12,850,000 or the total costs exceeding £42,880,000 per project; operating aid may not exceed £1,700,000 per infrastructure per year.

Sport Infrastructures - Specific Conditions

Sport infrastructure shall not be used exclusively by a single professional sport user. Use of the sport infrastructure by other professional or non-professional sport users shall annually account for at least 20 % of time capacity. If the infrastructure is used by several users simultaneously, corresponding fractions of time capacity usage shall be calculated.

If sport infrastructure is used by professional sport clubs, the pricing conditions for its use will be  made publicly available.

Access to the sport or multifunctional recreational infrastructures shall be open to several users and be granted on a transparent and non-discriminatory basis. Undertakings which have financed at least 30 % of the investment costs of the infrastructure may be granted preferential access under more favourable conditions, provided those conditions are made publicly available.

Any concession or other entrustment to a third party to construct, upgrade and/or operate the sport or multifunctional recreational infrastructure shall be assigned on a open, transparent and non-discriminatory basis, having due regard to the applicable procurement rules.

Local Infrastructures

Scottish local authorities may provide financing for the construction or upgrade of local infrastructures which concerns infrastructure that contribute at a local level to improving the business and consumer environment and modernising and developing the industrial base. Support for airport and port infrastructure is excluded.

The eligible costs shall be the investment costs in tangible and intangible assets. The aid amount shall not exceed the difference between the eligible costs and the operating profit of the investment. The operating profit shall be deducted from the eligible costs ex ante, on the basis of reasonable projections, or through a claw-back mechanism.

Dedicated infrastructure shall not be exempted under this Article.

The maximum amount of aid that can be granted is £8,500,000 or the total costs exceeding £17,000,000 million for the same infrastructure.

Budget

The estimated budget of the scheme is £60m over a five year period.

Duration

The scheme will operate from 1st January 2021 to 31st December 2025.

(ML / June 2021)