Guidance

Community Ownership Fund round 2: prospectus (not in use)

Updated 15 August 2024

Please see all supplementary documents relevant to the Community Ownership Fund. This has the most up to date information regarding the Fund including new guidance on how to complete your applications.   

Ministerial foreword

Levelling up is about a big, ambitious shift in investment and powers to reverse persistent geographic inequalities and unleash opportunity in overlooked, undervalued places right across the United Kingdom.

But, as set out in our Levelling Up White Paper, it is also about safeguarding the small, but much-loved local assets on which we cannot put a price.

Ranging from sporting and cultural institutions to community centres, pubs and high street shops, these assets are the golden thread in our social fabric and shared heritage; enhancing pride, belonging and quality of life.

When they find themselves in peril, we have often seen communities rallying around against the odds to save them.

It’s right that we do more to re-stack the odds in their favour.

This is precisely what the £150 million Community Ownership Fund aims to do; to ensure that local people across the UK can support and continue benefiting from treasured local institutions whose future may be in doubt.

Whether it’s the pub on the high street that’s facing closure, a village shop or a local sports team that might lose its ground, the Fund offers a great opportunity for local groups to take them over and to run them as businesses – by the community, for the community.

We are making good progress on this important work; with over £17 million announced for 70 projects so far which will benefit community centres, heritage buildings, pubs, and sporting facilities across the whole of the United Kingdom.

This is just the start. With a 4-year window until 2024/25 for more bids and investment to be released, I look forward to seeing many more small, but mighty local assets levelling up the places we love and secured for future generations.

Rt Hon Michael Gove MP
Secretary of State for Levelling Up, Housing and Communities

1. Overview

The £150 million Community Ownership Fund is for communities across the United Kingdom. It has been set up to help communities take ownership of assets at risk of closure. It will run for 4 years until 2024/25.

Voluntary and community organisations can bid for match funding. Funding may support the purchase and/or renovation costs of community assets.

Applications are subject to the eligibility requirements outlined in this prospectus. The Fund will support a range of proposals that enable people and communities across the UK to thrive.

Proposals will need to prove the value of the asset to local people and that the asset can run sustainably for the long-term benefit of the community.

This prospectus sets out information on the:

• eligibility requirements
• assessment criteria
• funding available
• application process
• next steps after submitting your application

1.1. Review of Round 1

The first bidding round opened on 15 July 2021 and closed on 13 August 2021. This pilot round was launched to test community appetite and trial the policies and processes developed. It was particularly focused at communities who were ready to take over assets.

Round 1 reopened for a limited period from December 2021 to February 2022. It was reopened to eligible bidders from Round 1 who were not funded but were facing urgent time sensitivities related to saving their community asset. Please note that the Fund will not be reopened again in this way in any future bidding windows.

Across the first bidding round the Community Ownership Fund funded 38 projects totalling £10.07 million. These include a range of asset types and are geographically spread across the UK.

1.2. Key changes since Round 1

We have made key changes to the Community Ownership Fund for future bidding windows.

These changes are informed by the lessons learned from the first pilot bidding round and the feedback we received from stakeholders and applicants. We have amended the design of the programme and the eligibility requirements in order to support a greater number of projects to successfully access the Fund.

These changes include:

• introducing a 2-stage application process by including an always open Expression of Interest (EOI) stage, where applicants will complete a short form to check if their project is likely to be eligible and receive a quick outcome on their proposals before submitting a full application
• moving to 3 bidding windows per year, meaning applicants can submit a full application once their EOI has been approved, at a time that is right for their project
• clarifying eligibility requirements for funding sporting assets and public sector assets
• extension of timeline for completing projects from 6 months to 12 months from the date indicated on the offer letter
• allowing the approval of bids for assets with at least 15-year leases and reasonable break clauses, although 25-year leases are still preferable
• removing the requirement for projects to have had a community use in the last 5 years, although assets must still have evidence of some past community use
• introducing a cap on the number of full applications that can be made for each project. Applicants are now permitted 2 full application attempts
• providing more information to successful applicants on what they can expect after receiving an offer letter

1.3. Future development support

Early stage support is now available to applicants via the My Community website . Please note that the service currently only offers initial advice, such as questions about the content of this prospectus. A more in-depth support offer to develop successful business cases will not be available to applicants in this window, but will be offered in the next bidding round.

You can find more information on the development support provider in section 9

1.4. Key documents and dates

The Community Ownership Fund opened for Expression of Interest applications on 10 June ahead of the application window opening later that month. To express your interest, see Community Ownership Fund round 2: how to express your interest in applying.

Once you have passed the EOI stage you will be sent a link to submit a full application to the Fund. Please note you can only submit a full application if you have received confirmation that your project is eligible at the EOI stage.

You will be able to submit an EOI form at any time, there are no bidding windows for this stage of the application. The full application will be submitted during fixed windows each year.

• the current bidding window will be open from 15 February and close on 14 April 2023
• each bidding window will close at 11:59am on its respective closing date

Your full applications must be submitted by 11:59am on 14 April 2023 if you are applying in the third bidding window.

For guidance on how to complete your applications, please read the assessment criteria guidance in full.

2. Purpose of the Fund

In this section you can find information on the strategic objectives and programme outcomes of the Community Ownership Fund.

The Community Ownership Fund is a £150 million fund over 4 years to support community groups across England, Wales, Scotland and Northern Ireland to take ownership of assets which are at risk of being lost to the community.

It forms part of a substantial package of UK wide levelling-up interventions, helping to support recovery, build opportunity and empower communities to improve their local places.

We recognise it can sometimes be hard for community groups to raise the funding needed to buy the asset and run it sustainably for the long-term benefit of the community. The Community Ownership Fund will help support local people to save local community assets at risk.

2.1. Strategic objectives

The Community Ownership Fund has 4 strategic objectives:

• to provide targeted investment for communities to save and sustain community assets that would otherwise be lost to community use
• to strengthen capacity and capability in communities, supporting them to shape their places and develop sustainable community businesses
• to empower communities in left behind places to level up
• to strengthen direct links between places across the UK and the UK government

2.2. Programme outcomes

For the purposes of this Fund, community ownership refers to the ownership and management of local community assets by a community organisation in order to deliver benefits for the community and place.

Community ownership of assets can boost local connections, participation and pride of place, and bolster community resilience. By investing in the capacity of communities across the UK to take ownership of the places and spaces that matter to them, we will strengthen the social infrastructure that helps communities to thrive.

Your applications should clearly demonstrate the project’s potential to deliver against all of the following outcomes:

• protect a community asset that is at risk and preserve its community value
• develop a sustainable operating model to secure the long-term future of the community asset in community ownership
• safeguard the use of community assets

The Fund supports projects which fulfil one or a combination of the following aims:

• acquire a physical community asset at risk, such as land and buildings which deliver a benefit to local people
• renovate, repair or refurbish the asset, only where it is a community asset at risk of closure and where this is critical to saving the asset and making it sustainable for long-term community use
• set up a new community business or buy an existing business in order to save an asset of importance to the community
• the purchase of associated stock, collections or intellectual property, where it is associated with buying a physical asset or buying a business to save an asset
• move a community asset to a new, more appropriate location within the same community. This might be because a different location offers better value to continue the asset, or because the venue is in itself an asset of community value

We want to fund community projects that do at least one of these 5 things:

• increase feelings of pride in, and improve perceptions of, the local area as a place to live
• improve social trust, cohesion and sense of belonging
• increase local participation in community life, arts, culture or sport
• improve local economic outcomes – including creating jobs, volunteering opportunities and improving employability and skills levels in the local community
• improve social and wellbeing outcomes – including having a positive impact on physical and/or mental health of local people and reducing loneliness and social isolation

We will invest in community ownership projects where these assets make the biggest difference to the local place. You should demonstrate how the benefits of the community asset will address community need in their local place. Further details of how to illustrate this in your applications can be found in the assessment criteria guidance.

Your applications will also be measured against our monitoring and evaluation requirements. You can find more details of these requirements in section 7 of this prospectus.

2.3. Strengthening community ownership across the UK 

The Fund will be delivered directly by the UK government to communities in England, Scotland, Wales and Northern Ireland. The UK government is committed to fair opportunities to access funding through the Community Ownership Fund across the UK.

A minimum target of spending in line with per-capita allocations has therefore been set in Scotland, Wales and Northern Ireland. The Community Ownership Fund will target a minimum of £12.3 million in Scotland, £7.1 million in Wales, and £4.3 million in Northern Ireland of the total Fund over the 4 years.

The design of the Fund recognises the different landscapes for community ownership across the UK, with different legislation in England and Wales, Scotland, and Northern Ireland. We have engaged widely with local stakeholders to ensure the Fund is effective, accessible and achieves its objectives.

Applications will be assessed against a consistent framework. Eligibility for the Fund and the bidding assessment criteria are consistent in all 4 nations

3. Eligibility requirements

This section covers the mandatory eligibility requirements for all applications and the additional requirements for projects if they are sporting assets or publicly owned assets.

3.1. Mandatory eligibility requirements for all projects

To secure funding for your community project, you will need to fulfil all of the following mandatory eligibility requirements:

The asset is at risk of loss without community intervention

Risk might be from closure, sale, neglect and dereliction under current ownership, or unsustainable operations under the current business model.  

You should demonstrate the nature of the risk facing the asset. This will include evidence that, without community intervention, the asset would be lost to the community.

The type of asset is in scope of the Fund

We recognise it is important for communities to set out what matters most to them, what is best for their local area, and the benefit the asset brings to their place.  

We won’t publish a definitive list of community assets which are in scope of the Fund. Some successful projects that we have funded to date include community centres, sporting and leisure facilities, pubs, cultural buildings and heritage buildings. 

For projects in England, any building or land which has been listed by a local authority as an Asset of Community Value would be within the scope of the Fund, but your asset does not have to be listed as an Asset of Community Value to be eligible.

The project is sustainable and viable

Your applications should demonstrate how the asset will be protected for the long-term benefit of the community. Organisations must show this through their charitable purpose and/or an asset lock within their governing documents.   
 
You should demonstrate how you are accountable to the local place and/or community you represent, how you will operate for the benefit of the wider community in tangible ways, and how you will use the asset to deliver community impact.  
 
Profits from the community asset and businesses should be reinvested in the asset to deliver community benefit.

There is a realistic chance that the asset could be sold or transferred into community ownership within 12 months of being offered funding

Organisations who already own their asset are eligible to apply for funding to renovate their asset, provided the asset would otherwise be at risk of closure or loss to the community.

Renovations that improve the asset, but which are not essential to its continued operation, will not be funded.

You can demonstrate you can ‘match’ the capital grant from the Fund at the required match funding rate

Up to £250,000 match funded capital will be available for all eligible types of assets.  

In exceptional cases, bidders will be able to make the case for up to £1 million match funding for assets related to sports facilities.

You can demonstrate that capital grant funding and match funding will be spent within 12 months of the date indicated on the offer letter

The Community Ownership Fund grant needs to be drawn down within 12 months. To draw down this grant, the equivalent level of match funding has to be in place, that is, secured and evidence of this provided.  

Your Community Ownership Fund grant can be drawn down in full (provided you have your full match funding secured) or it can be drawn down in instalments as necessary for your project.  

Any costs incurred before the deadline for submitting an application in the window that you applied will not be eligible as part of the Community Ownership Fund project funding package. You should note that any spend you incur before receiving your outcome letter is spent at your own risk.

If your application is successful, this spend will be checked by your grant manager to determine if it can be counted as eligible funding.

If you are not found successful in the window you incurred your spend, this spend will not be eligible if you decide to apply in a future window of the fund.

The project revenue funding does not exceed £50,000 or 20% of the total capital funding applied for, whichever is smaller

Revenue funding does not need to be matched.

Projects applying for £1million match funding will not receive more than £50,000 in revenue funding.

Your organisation is an eligible organisation

We will consider applications from voluntary and community organisations from all parts of the United Kingdom who have a viable plan for taking ownership of a community asset at risk and running it sustainably for community benefit.

Common legal structures of organisations we expect to apply include a charitable incorporated organisation (CIO); Scottish charitable incorporated organisation (SCIO); Co-operatives including Community Benefit Societies; Community Interest Company (CiC); or Not-for-profit company limited by guarantee.   

Unincorporated organisations can apply at the EOI stage, but they must be an eligible organisation before applying for the full application stage.

Your organisation is able to acquire the asset freehold, or the long-term leasehold of at least 15 years with reasonable break clauses

Community groups should clearly demonstrate the long-term security of the asset in community ownership alongside a sustainable, long-term business plan. Break clauses should be proportionate and not unduly increase the likelihood that the asset would be lost from community use through early termination.

Assets with leaseholds of 25 years and no early break clauses are preferred as applicants will find it easier to demonstrate the long-term sustainability of the asset in community hands.

The organisation that applies for funding must be the same organisation that will receive the funding and run the project

If the circumstances of your organisation change after the application has been approved, this must be discussed in the first instance with the Grant Manager. There is no guarantee that changes of this nature will be allowed, and the offer of funding may be withdrawn.

3.2. What we can’t fund

The Community Ownership Fund will not provide funding to:

• pay off businesses’ debts or to buy an indebted business
• purchase or develop housing (including social housing) assets, however you can include housing assets where these are a small part of supporting the overall financial sustainability of the asset in community ownership
• fund new-build projects to develop new assets, unrelated to saving or preserving an existing asset
• fund general revenue for community activities or events unrelated to the acquisition or transfer of a community asset
• fund the costs of purchasing publicly owned assets where the public authority would credit a capital receipt
• support acquisition of public sector assets if this involves transferring responsibility for delivering statutory services from the public authority to the community organisation
• public bodies, companies limited by shares, unincorporated organisations (unless you plan to incorporate before the full application stage) or private individuals
• projects which have already been awarded funding by the Community Ownership Fund in a previous bidding window
• fund the expansion of, or improvements to, an asset which is not at risk i.e. building an extension so more people can access the asset. However, we will consider organisations that already own community assets and are seeking to purchase a separate asset which is itself at risk

Local authorities and town, parish and community councils are not eligible to apply to the Fund. However, we hope that councils right across the United Kingdom will play an active role in supporting their local community groups to apply. Evidence of support from local authorities may help to support your application.

3.3. Additional eligibility requirements for sporting projects requesting more than £250,000 of capital funding

Some sports-related assets will require greater funding to be saved. For this reason, in exceptional circumstances an increased cap of up to £1 million match capital funding will be available to help eligible applicants secure the community ownership of prominent sports clubs or facilities.

Alongside the mandatory eligibility requirements that every applicant will need to fulfil, bids will also need to demonstrate the following additional requirements to access this higher amount of funding. Note that these additional requirements do not apply to sports projects requesting only up to £250,000.

These additional requirements are that:

The total capital costs for the purchase and any associated renovations exceed £500,000

The Fund will provide up to 50% of capital costs for successful projects, up to a maximum of £1 million.

You can clearly demonstrate the support and recognition of the importance of the sporting club/asset

This might be because of the club/asset’s history, the importance to its community, its level of usage, the development of successful sportspeople, or its position as a venue that hosts national or international sporting events.

You should demonstrate the asset or club is used by, and benefits, the community at large (e.g., community outreach activities across the whole town or wider community)

This might include a sports development plan, health and wellbeing outcomes or employment and skills outcomes.

You have a coherent asset management and development plan

You can demonstrate that, in recognition of the complexity of these kinds of projects, you have the appropriate expertise to support the purchase and future operation of the club/asset

This should include establishing robust governance processes as part of any potential investment.

Your proposed business plan is robust and realistic and does not rely on promotion of a sports team to generate higher levels of income

If relevant, you can evidence that the asset is protected from the financial risks of running a professional/semi-professional team such that over-investment in playing contracts and associated costs does not jeopardise the ownership of the assets

If relevant, that you are purchasing the entire shareholding of a sporting asset. You should evidence that:

• the company is financially sustainable
• you have, and can maintain, complete control of the company
• the availability of grant does not artificially increase the value of the shares to be bought
• the value of the shares reflects the underlying value of the assets in the company
• the assets of the company, including property, are not sold to third parties immediately prior to the purchase of the shares
• the title to the assets of the company has been confirmed

Sporting projects that could be eligible for a higher amount of funding may aim to:

• maintain the operation of a prominent club that is at risk of closing
• secure the future of a prominent sports facility that is at risk of being lost to the local community

This may be achieved through the following actions:

• the purchase or long-lease of playing pitches, stadia, venues or other sporting facilities
• the renovation, redevelopment or improvement of such facilities following the acquisition of such assets
• the purchase of the assets, including plant, memorabilia and intellectual property from a company operating a prominent club that is in administration

3.4. Additional eligibility requirements for publicly owned assets

We recognise that a significant number of assets owned by the public sector at risk of closure are suitable for community ownership. We encourage applications from community groups seeking funding to save publicly owned assets.

Alongside the mandatory eligibility requirements that every applicant will need to fulfil, bids relating to publicly owned assets will also need to demonstrate the following additional requirements.

These additional requirements are that:

• The responsibility for delivering statutory services (if relevant) is not transferred from the public authority to the community organisation
• The Community Ownership Fund grant received will only be used for renovation and refurbishment costs following the transfer of an asset into community ownership; the public authority will not credit a capital receipt from Community Ownership Fund funding.

These additional requirements are necessary because local authorities have a number of statutory functions requiring them to provide various services to their communities.

Although the Community Ownership Fund grant can’t finance the purchase costs of assets where the public authority would credit a capital receipt, the Fund will work alongside existing Community Asset Transfers frameworks to support these transfers and fund renovation and refurbishment.

Additional evidence for publicly owned assets 

For projects relating to publicly owned assets, we will require specific evidence covering the following points:

• Risk facing the asset - the Fund will only invest in community assets which would otherwise be lost. We will therefore need evidence from both the current public owner and applicant about the current status of the asset and why its future is at risk
• Impact on service provision - evidence that any statutory services currently delivered from the asset at risk will be continued by the public authority. This may be evidenced by a letter or appropriate cabinet paper from a local authority, for example
• Deliverability and sustainability - we can’t invest in projects where we assess the transfer of liabilities associated with the asset to be unmanageable or unreasonable. Sustainability of the management of the asset should be evidenced in the application

4. Grant funding and match funding

In this section you can find information on the funding available for your project and the match funding requirements.

4.1. Funding available

You can apply for a blend of capital funding and revenue funding.

Capital funding

Capital funding is used to purchase or lease the asset and pay for refurbishment costs.

Up to £250,000 match funded capital will be available for all eligible asset types.

In exceptional cases, bidders will be able to make the case for up to £1 million match funding to help establish a community-owned sports club or help buy a sports club/asset at risk of being lost without community intervention.

Revenue funding

Revenue funding is used to fund the running costs of the project. This might include general costs, utilities, staffing costs, or recruitment for example.

Revenue funding does not need to be matched but the requirement for revenue funding needs to be identified in cashflow forecasts in the business plan.

Please note that your revenue funding request cannot be more than 20% of your capital funding request or £50,000, whichever is smaller. This is also applied to sporting assets applying for up to £1m capital funding.

Revenue funding scenarios

• if you are requesting £150,000 in capital funding, you can apply for up to £30,000 in revenue funding in addition to your capital grant

• if you are requesting £250,000 in capital funding, you can apply for up to £50,000 in revenue funding in addition to your capital grant

• if you request £150,000 in capital funding and £50,000 in revenue funding, this would be over the 20% limit and your application would be rejected

• if you are requesting £1 million in capital funding for a sporting asset, you can apply for up to £50,000 in revenue funding in addition to your capital grant

You can access 2 types of revenue funding:

• pre-acquisition support – this will be awarded alongside the main capital grant to cover feasibility studies, professional services and business support in establishing the asset
• post-acquisition support – this will be awarded alongside the main capital grant to support organisations to manage cash flow in the first year of operation

You may apply for any split of the pre-acquisition support or post-acquisition support as is necessary for your project, as long as it is within the revenue funding cap of 20% of your capital funding request or £50,000, whichever is smaller.

4.2 Match funding requirements

You are required to raise other sources of funding alongside investment from the Community Ownership Fund. Having a range of funders contributing to your project can demonstrate the quality of the project and the support within the community.

The Community Ownership Fund will contribute up to 50% of total capital required. You will need to set out the total project costs, funding already secured and plans to raise any additional funding needed in your full application.

Match funding scenario

• an applicant wants to purchase a community asset for £400,000

• they can bid for a £200,000 capital grant from the Community Ownership Fund and must raise the other £200,000 themselves

• the applicant can also bid for up to £40,000 of revenue funding (20% of the capital grant requested)

• the applicant does not need to match the revenue funding

Eligible sources of match funding will include funding from:

• your own financial resources
• public bodies
• devolved administrations
• charitable trusts
• national lottery funders
• community shares
• social investors
• other lenders

As part of due diligence, assessors will review conditions of any loan taken out by the organisation.

The following ‘in-kind’ match funding (otherwise known as ‘non-cash’ match funding) will also count as an eligible source of match funding:

• donations of goods relevant to the project that would otherwise have been purchased
• the value of a discount on a long-term leasehold or freehold, for example as part of an asset transfer, the value of such a discount must be professionally valued
• buildings or professional services, including from:
  • individuals
  • community groups
  • funders
  • businesses

For example, a construction company could donate their services to the project free of charge, but they will be required to issue an invoice to prove the value of that service on the open market in order for it to be considered as possible match funding.

The Gift Aid elements of donations won’t be eligible. Volunteer time also won’t be an eligible source of match funding for the purposes of this Fund; however, the involvement of volunteers in a project will help applicants demonstrate community support and buy-in.

Applicants are not required to have all match funding sources secured at the time of project application. However, you must set out clear and realistic plans to secure match funding in your business plan and it will need to be in place in order to draw down your grant funding if you are successful.

Capital funding for successful projects may be awarded in principle, dependent on sufficient match funding being in place at the time you are requesting to drawdown your grant. In addition, successful applicants will need to demonstrate that you are able to secure and spend the full project funds within 12 months of the date indicated on the offer letter. If you are not able to demonstrate reasonable progress towards securing and spending these funds, the UK government reserves the right to withdraw the offer of funding.

Any costs incurred before the deadline for submitting an application in the window that you applied will not be eligible as part of the Community Ownership Fund project funding package. You should note that any spend you incur before receiving your outcome letter is spent at your own risk.

If your application is successful, this spend will be checked by your grant manager to determine if it can be counted as eligible funding.

If you are not found successful in the window you incurred your spend, this spend will not be eligible if you decide to apply in a future window of the fund.

5. How your bids will be assessed

In this section you can find information on the EOI stage of the application process and the assessment criteria which your full application will be assessed against.

The UK government will assess bids from across the UK against a common assessment framework. Applications will be scored using this framework and final decisions on funding will be made by the Department for Levelling Up, Housing and Communities (DLUHC).

We have published additional guidance on assessments and how to complete your applications. You are strongly advised to read this guidance carefully before beginning applications.

5.1. Expression of Interest (EOI) stage

You will need to submit an EOI form and have this approved before progressing to submit a full application to the Fund. The EOI form will test whether your project is likely to be eligible thorough a pass/fail assessment based on the eligibility requirements.

This brief form will ask for:

• details of the organisation applying
• a project description
• how much is being requested in capital and revenue funding
• how the project meets the eligibility requirements

Unincorporated organisations can apply at the EOI stage, but they must become incorporated before submitting their main application.

If after reading your EOI form we think your project is likely to be eligible, we will invite you to submit a full application. We may also highlight some areas to consider before submitting your full application or tell you that your project is not eligible for funding without a significant change.

The EOI stage will be always open so you express your interest at any time. It is designed to strengthen the application process by ensuring you are fully aware of the eligibility requirements ahead of submitting a full application.

If your EOI is successful, you’ll be invited to submit a full application, which you do not have to do immediately, so choose the right time for your project. Check the bidding window timings for the full application stage in the prospectus. For example, if you plan to apply in bidding window 3, you need to express your interest at least 3 weeks before the closing date of 14 April 2023.

Please note you can only submit a full application if you have received confirmation that your project is eligible at the EOI stage.

5.2. Assessment criteria

Once your project has been deemed eligible at the EOI stage, you will be invited to submit a full application to the Fund.

At this stage, your application will be assessed on the following 4 criteria:

1.  Strategic case: you should show that without intervention the asset would be lost to the community, the impacts that this would have and support you have from the community and other partners.

2.  Management case: you should show the costs of the capital project, sources of match funding, a programme for delivery, provide a business plan including a cashflow forecast and identify how you will manage risks. We will also want to see how you will manage the asset to check that it is sustainable. This means telling us about the skills you have to deliver the project, the professional support you will commission and the staff that you will employ to run the asset. We would expect to see all of this information in the business plan.

3. Potential to deliver community benefit: using the outcomes framework available in the assessment criteria guidance document, you should show how the asset will deliver community benefits under community ownership.

4.  Added value of the community asset based on community need: using local data and information on community need, you should be able to show the added value of the asset to the community.

Full details and guidance on how to complete your applications can be found in the assessment criteria guidance.

All bids must be received before 11.59am on the closing date of the bidding window you are applying in. Your application forms must be fully completed with the required documentation attached.

5.3. Conditions of capital award

If you are successful, we will require the following before releasing capital funds (if they were not already supplied as part of full application). These include:

• an independent valuation of the building, only when the grant is being used to fund purchase costs and where the property is not being acquired on the open market. This will not be required if you already own the asset
• an independent structural survey
• evidence of any planning, licencing and other appropriate permissions secured

Full due diligence and fraud safeguarding checks on the project and applicant will be carried out once applications are submitted and before any funds are released.

As part of the conditions of the award for funding, milestones and project targets will be agreed, alongside standard monitoring and review periods. This will be set out in a formal Grant Funding Agreement.

Grants must be used for the purpose intended as set out in the conditions for award. This will be subject to monitoring and final review. Failure to comply with the conditions of award could lead to funding being withdrawn or clawed-back. As part of the Grant Funding Agreement for successful applicants, a legal charge against the asset may be required.

5.4. Subsidy control/State Aid

If funding from the Community Ownership Fund is used to provide a subsidy, expenditure must be compliant with the United Kingdom’s obligations on subsidy control.

All bids that may be considered subsidy must consider how they will deliver in line with subsidy control (or State Aid for aid in scope of the Northern Ireland Protocol). You can refer to the UK government guidance on subsidy control for more information.

Bids supported by the Community Ownership Fund must comply with the relevant legislation in their respective geographical areas.

5.5. Public Sector Equality Duty

As a public authority, the Department for Levelling Up, Housing and Communities is required to comply with the Public Sector Equality Duty, as set out in section 149 of the Equality Act 2010. We give due regard to equality impacts on individuals by reference to their protected characteristics at key decision points and keep this under review.

We recognise the importance of not only meeting our legal obligations under the Equality Act 2010 but also giving due regard to the equalities considerations that apply in Northern Ireland.

6. Decision-making

In this section you can find information on the decision-making process for awarding funding.

Decisions on awarding Community Ownership Fund grant funding are taken by DLUHC Ministers, following advice from officials and ministers from other relevant government departments. We may also engage with local authorities and stakeholders for advice on bids in the local area. The Department for Digital, Culture, Media and Sport (DCMS) will advise on bids relating to sports, culture, arts and heritage.

Ministers will be provided with a shortlist of bids that have passed eligibility and due diligence checks, and which meet a benchmark score against the assessment criteria.

The DLUHC Secretary of State will make the final decision on which shortlisted projects will be funded.

The Secretary of State will exercise discretion by considering the following considerations only:

• ensuring a balanced spread of location of projects across all parts of the United Kingdom
• ensuring a proportionate spread of the location of projects between rural and urban areas
• ensuring a reasonable thematic split of asset types supported by the programme

The Secretary of State may also choose to fund bids in score order, from highest scoring to lowest scoring, or to fund all shortlisted bids.

Other government ministers will also advise the Secretary of State through the Ministerial Review Panel with reference to these additional considerations only. The Panel will comprise of ministers from DLUHC, HM Treasury, DCMS and the Territorial Offices.

Where projects are based in a Minister’s constituency, the Minister will recuse themselves from the discussion and decision-making process and will delegate to another Minister of that department.

7. Monitoring and evaluation

In this section you can find information on the monitoring and evaluation requirements of the Community Ownership Fund programme and the Fund’s approach to national evaluation.

Successful applicants will be required to comply with the monitoring and evaluation requirements of the programme.

7.1. Monitoring and evaluation requirements

The progress of projects will be monitored at least quarterly, in line with agreed milestones. A statement of grant usage audited independently by an accountant for our assurance processes, in line with agreed project milestones, will be required.

6 months after project completion, you will be required to provide a set of accounts for the project approved and signed off by the Board (or equivalent). All files and financial records will be kept for a minimum of 7 years from the date indicated on your offer letter and may be examined at any time during this period.

Audit and assurance colleagues will be in touch at the end of the project and at any time during the extended monitoring period.

Impact data on your project will be required after 1 year from the date indicated on your offer letter. This is to demonstrate the impact the funding has had on your community. A standardised template and guidance will be provided to support you to demonstrate the impact of your project and delivery against your original business plan.

This may include:

• safeguarding and improving usage of community asset
• businesses and community organisations’ support
• the creation of jobs and volunteering opportunities
• types of services established within the asset
• improvements in access to services

7.2. Our Fund’s approach to national evaluation

The UK government recognises the central importance of high-quality evaluation, which is critical to understanding what works. To support this, at a national level we are developing our programme evaluation strategy.

This evaluation will help us understand the success of the programme, what works well in successful community ownership projects, and will help inform future investment decisions.

Our approach to programme evaluation will use a combination of administrative data from programme monitoring and could include surveys and project level case studies. These will help us to evaluate the success and value for money of the programme against the following criteria:

• the number of assets supported through the programme
• the survival rate of community assets – this will be measured by the number still operating in community ownership one year after the end of the project
• levels of increased usage of community assets and associated services - this will be measured by footfall, increased tenancies and/or community group use
• levels of increased feelings of pride and improving perceptions of the local area as a place to live
• levels of increased social trust, cohesion and sense of belonging in the local place
• levels of increased local participation in community life, arts and culture and sport
• the impact on additional economic outcomes including:
  • jobs saved and/or created
  • new volunteering opportunities
  • improvements in employability
  • skills levels
• the impact on additional social outcomes: including improvements in physical and/or mental health and reducing loneliness and social isolation

8. Applying to the Fund

In this section you can find information on the 2-stage process of applying to the Fund and what you will need to have in place before submitting a full application. You can also find information on the next steps depending on the outcome of your application.

8.1. How to apply

Stage 1 – Submitting an EOI and securing confirmation to proceed with a full application

The first stage is the approval of an Expression of Interest (EOI) form, which will confirm whether your project proposal is likely to be eligible for funding. You can find more detailed information on the EOI stage under section 5.

Before you begin your EOI, please ensure you are familiar with the eligibility requirements set out in this prospectus.

The EOI stage is always open. To express your interest, see Community Ownership Fund round 2: how to express your interest in applying.

Stage 2 - Submitting a full application

Once you have passed the EOI stage, we will invite you to submit a full application to the Fund by sharing the application link.

We have published additional guidance on assessments and how to complete your applications.You are strongly advised to read this guidance carefully before beginning applications.

There is certain information your organisation will need to have in place before you submit a full application. These include:

A business plan – this should include (but is not limited to):

• information about the capital element of your project. This could include:
  • information about your completed or planned feasibility studies. This could include any relevant surveys
  • a programme with key milestones for completion of your project
• a financial breakdown of your project – this should include:
  • a clear breakdown of the total capital project costs and explanation of how these have been calculated. This could include any quotes or cost benchmarking
  • whether the costs include irrecoverable VAT
  • the capital funding request from the Community Ownership Fund
  • the total amount of match funding required
  • sources of match funding secured to date
  • sources of match funding still to be secured
  • timescales and potential sources for securing all outstanding match funding
  • an independent valuation of the asset (if required)
  • your skills and resources to manage the capital project, including relevant project management expertise
• information about how the asset will be used and managed in the future. This should include:
  • a discussion of planned activities and/or services that will take place in the community asset
  • your full financial forecasts, including income sources and costs with an evidenced set of assumptions
  • an explanation of the use and need of revenue funding (if requested)
  • a clear breakdown of the revenue project costs and explanation of how these have been calculated
  • your cashflow and revenue budgets
  • your skills or resources to manage and maintain the asset in community ownership
  • your experience of delivering similar projects
  • roles you plan to recruit to help you manage the asset
  • any supporting evidence that you will deliver the benefits to the community you have outlined
• a consideration of risks and mitigations of both the capital works/spend and the ongoing operation of the asset
• project risk registers
• organisational and governance information – this should include:
  • your organisation’s governance and membership structures, with supporting evidence
  • members of your board, including their role and main responsibilities
  • supporting evidence of how you will manage finances and prevent fraud. For example, copies of your policy documents
  • supporting evidence of how you will manage performance and risks. For example, copies of your policy documents

You’ll be able to upload supporting documents for specific questions throughout the application form. This includes a business plan, which must be a single document no larger than 5MB.If you have any technical problems, email COF@levellingup.gov.uk and we’ll be able to help.

Key information for the full application bidding windows in 2022/23 are as follows:

• bidding window 3: 15 February to 14 April 2023
• each bidding window will close at 11:59am on its respective closing date
• the dates of future bidding windows will be announced in due course

Your full applications must be submitted by 11:59am on 14 April 2023 if you are applying in the third bidding window.

8.2. Application outcomes

Successful projects

Once the application has been reviewed and approved, successful applicants will receive an offer letter from DLUHC via email. You will then be contacted by your dedicated Grant Manager, who will be the first point of call for all queries for the remainder of the project.

The Grant Manager will issue a Grant Funding Agreement (GFA) which will be signed by the project organisation and by DLUHC. It will be the responsibility of the project to work with DLUHC to put a charge against the asset if needed.

The Grant Manager will hold an Initial Project Meeting with you to discuss the requirements for Community Ownership Fund grant recipients and answer any questions that might arise. Throughout the project, the Grant Manager will keep in regular contact with you and support the processing and payment of claims.

To meet our audit and assurance requirements, you must agree to provide independent assurance that the grant has been used for the delivery of project activities. This includes providing an independent certification of financial audit at any time when requested by the Secretary of State, as well as retaining all invoices, receipts, accounting records and correspondence documentation relating to eligible project expenditure.

Alongside the support given by your Grant Manager, the development support provider will provide ongoing support for all successful projects once it is in place in 2023. This is to ensure you deliver successfully and in line with the programme requirements. The support offered will include advice, guidance and facilitating peer support.

Unsuccessful projects

Unsuccessful applicants will receive a notification via email setting out the decision along with a summary of feedback. This decision will be final.

You are welcome to reapply to the Fund in another bidding window.

We have introduced a cap on the number of full applications that can be made for each project – you are permitted 2 full application attempts.

If you are unsuccessful in the first bidding window, you are allowed to make one further application to the Fund. If your second attempt is also unsuccessful, you will be unable to apply again for the same project.

After 2 unsuccessful applications we will allow organisations to apply to the Fund again if they have an entirely new project relating to a different asset. Partially updated or changed applications will not be considered.

Please note you cannot apply for further Community Ownership Fund funding for an asset that you have already received funding for.

Applications to Round 1, including the limited reopening of Round 1 from December 2021 to February 2022, do not count against the 2-application limit.

9. Additional support

In this section you can find information on the additional support that will be provided by the development support provider.

9.1. What is the development support provider?

We have secured a development support provider who can provide initial advice to applicants in this window via the My Community website.

Please note that the service currently only offers initial advice, such as questions about the content of this prospectus. A more in-depth support offer to develop successful business cases will not be available to applicants in this window, but will be offered in the next bidding round.

9.2. Support for every applicant up to the EOI stage

The development support provider can offer targeted support to applicants based on the needs of the project. This will include explaining the eligibility requirements and offering top tips on setting your project up for success.

9.3. Targeted support for some applicants in the development of a full application

After the EOI stage, certain projects will be recommended for further development support. Please note that this support will not be available for this bidding window.

In future bidding rounds, the development support provider will offer targeted support to applicants based on the needs of the project.

This targeted support may include:

• assistance with developing your business case, organisational governance and financial planning.
• potential to access small revenue grants to secure specialist support, such as legal advice or building surveys

Projects eligible for targeted support may also be eligible for a reduced match funding rate if you are saving a less commercial asset (such as community centres, parks and heritage buildings). In exceptional cases, the requirement for match funding can be reduced from 50% to 30%. A maximum of £250,000 capital grant funding will be available.

Whether your asset is more commercial or not will be considered on a case-by-case basis by the development support provider and not simply prescribed by asset type, as there is great variation between projects.

9.4. Accessing this support

Initial advice and support can now be accessed via the My Community website. If you think further in-depth support would be beneficial to your project, please contact the development support provider before submitting your main application form in this bidding window, while bearing in mind the provision of targeted support in the development of a full application is not available immediately nor is it guaranteed for every project.

If you are confident in your project you do not need to wait.

10. Glossary of terms

Community Asset Transfer

Across the United Kingdom, Community Asset Transfer (CAT) policy frameworks support the transfer of community assets from public authorities to community organisations. The legislation and policy contexts work slightly differently in parts of the United Kingdom.

England

Asset of community value

In England the Localism Act 2011 introduced a right for community groups to nominate buildings or land to their local authority as an asset of community value. If the local authority agreed that the nomination met the test of being land of community value, the council would place the asset on a list of assets of community value for a period of 5 years.

What this did was introduce a community right to bid. If the owner of a listed asset decided that they wish to sell the asset during the 5-year period of listing, then they must notify the local authority who would inform the nominating community group. The group would then have a right to trigger a moratorium of up to 6 months to raise the purchase price. At the end of moratorium period the asset owner is free to sell to whoever they choose.

In England local authorities are responsible for managing their own asset of community value scheme.

England and Wales

The Local Government Act 1972 General Disposal Consent (2003) enables local authorities to transfer assets into community ownership, at less than market value or nil cost, on the presumption of securing long-term social, economic or environmental benefit. Individual local authorities may have their own CAT policies which determine the specific objectives and processes for that local area.

Scotland

The Community Empowerment Act (2015) provides the right for community bodies to make requests to all local authorities, Scottish ministers and a range of public bodies for any land or buildings they feel they could make better use of.

Northern Ireland

The Community Asset Transfer policy framework (2014) sets out the process for a change in management and / or ownership of land or buildings, from public bodies to communities. The framework has been developed as a tool for investing in regeneration and positive social, economic and environmental outcomes.

Other key terms

Business model

Model which the organisation uses to generate income or value from its activities. This might include selling goods and services, delivery contracts or rental income.

Capital works

Refers to the building works which might be necessary on the asset to refurbish, for example for the change of use of asset.

Feasibility study

Analysis which tests the ability of the project to deliver its objectives. This should test the context and resources within which the project is operating, including market analysis, and whether the financial, technical and management capabilities are strong enough to deliver the range of uses planned for the asset. The viability and sustainability of the project in the long term should be tested. Feasibility studies should be used to develop a strong business plan.

Freehold

The outright ownership of land and/or property.

Grant manager

The main point of contact for all project queries for successful applicants.

Grant Funding Agreement (GFA)

This sets out the conditions which apply to the organisation receiving the grant funding from DLUHC.

Initial project meeting (IPM)

A first meeting that takes place between the successful project and their Grant Manager to discuss the requirements for grant recipients and answer any questions that might arise.

Leasehold

The right, set out in a contract, to occupy land or a building for a specified length of time.

Pre-feasibility

Project which is yet to undertake detailed feasibility work (see below) and the support that may be required to help test initial ideas and develop options for a business plan.

Statutory services

Services that public authorities have to provide by law.

Subsidy

A financial contribution using public resources which confers a benefit on the recipient. This could include, for example, a cash payment, a loan with interest below the market rate or a loan guarantee. Subsidies are administered by all levels of government in the UK including central government, devolved administrations and local authorities, as well as other types of public authority. More information on subsidy controls is available.

Working capital

Operational finance needed to cover the costs during the early stages of trading, as the business model becomes established, and activities develop. Projects should expect to be able to cover losses in this early period, as income sources grow, and should plan for enough working capital to ensure there is adequate cash to pay wages, invoices and other costs.