APPENDIX ONE MEMORANDUM OF UNDERSTANDING BETWEEN COMMUNITY FOUNDATIONS FOR LANCASHIRE AND MERSEYSIDE AND LIVERPOOL CITY REGION COMBINED AUTHORITY 1. Introduction 1.1 This Memorandum of Understanding (“MOU”) is between the Community Foundations for Lancashire and Merseyside (company number 03422207; charity number 1068887) whose registered office is at Third Floor, Stanley Building, 43 Hanover Street, Liverpool, L1 3DN (“CFLM”) and the Liverpool City Region Combined Authority (“Donor”), No 1, Mann Island, Liverpool, L3 1BP and concerns the arrangements for the management of a charitable fund to be known as LCR Cares COVID-19 Community Support Fund (“the Fund”). 1.2 The Fund is being created to be used to support a wide range of charitable projects to support community businesses and third sector organisations impacted by Coronavirus/COVID-19 and that primarily benefits people within the Area of Benefit, Liverpool City Region. This includes all six Local Authorities that comprise Liverpool City Region; Halton, Knowsley, Liverpool, Sefton, St Helens and Wirral. The Fund is considered to be a mechanism by which funding can be made available to benefit the community in a fair and transparent manner, within an appropriate governance structure. The fund will address Immediate and emergency support for community businesses and third sector organisations Resilience measures/support for community businesses and third sector organisations 1.3 The Fund will comprise sums paid to CFLM from public, private, corporate donations along with financial support from other charitable trusts and foundations. 1.4 The Fund is to be applied for the benefit of people in the Liverpool City Region. 1.5 The Donor has appointed CFLM to act as trustee and provide governance, funding awards and administrative support in relation to the Fund being donated. 2664246.1 1.6 The Fund will be held and managed by CFLM as a restricted fund (with the terms of any restriction to be agreed by the parties) CFLM is a registered charity whose charitable objects are “the promotion of any charitable purposes for the benefit of the community in the United Kingdom but primarily within the following areas: the five Metropolitan Boroughs presently constituting the area of the County of Merseyside namely the City of Liverpool and the Metropolitan Boroughs of Wirral, Sefton, Knowsley and St Helens together with the area of Halton Borough Council; the County of Lancashire and the Boroughs of Blackburn with Darwen and Blackpool”. 1.7 Unless agreed otherwise and in writing by the parties and notwithstanding clause 1.6, the Fund will be paid to CFLM by the Donor without distinction between capital and income and without restriction upon the application of the capital. CFLM will treat initial and future donations as flow through funds. 1.8 CFLM is to work with the Donor and / or other interested parties who collectively are to be known as the Funding Panel (“the Panel”). The Panel is to advise CFLM in all aspects of the management of the Fund, which includes (but not limited to) identifying priorities for the use of the Fund, making recommendations for the use of the Fund and suggesting projects to benefit from the Fund. 1.9 This MOU is considered to be in effect from the date this document is signed. 1.10 Unless expressly stated otherwise, this MOU 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 members of the Panel as charity trustees of the Fund. 2. Area of Benefit 2.1 The Fund is to benefit principally the communities of the Liverpool City Region Combined Authority area. This is the designated “Area of Benefit”. The Fund may also be applied outside of the Area of Benefit at the discretion of CFLM and the Panel, subject to clause 2.2. 2.2 Projects or services located out with the Area of Benefit, or benefiting those other than people in the prescribed Area of Benefit may also be supported on a case by case basis, provided that there is a clear benefit to people in the prescribed Area of Benefit or an otherwise recognised group within the Area of Benefit. 2.3 CFLM, with the assistance of the Panel, will periodically review the Area of Benefit to ensure that the Fund is being adequately applied for and distributed. Should there be any cause for concern, formal discussions will 2664246.1 take place between CFLM, the Panel and the Donor to try and rectify the situation and / or revise the Area of Benefit. 3. Use of Funds 3.1 The Fund is being created to support charitable purposes in the Area of Benefit as described in clause 1.2 by primarily supporting the charitable activities of constituted, not-for-profit groups working to benefit people within the Area of Benefit. Support for individuals who are not normally residents within the Area of Benefit is also considered a permissible use of the Fund provided that such support is awarded for clear charitable purposes and in accordance with clause 2.2. 3.2 It is recognised that the Fund can be used towards (but not restricted to) the following purposes, provided that in each case, the purpose is recognised as being charitable according to the law of England and Wales: 3.2.1 The prevention or relief of poverty; 3.2.2 The advancement of education; 3.2.3 The advancement of health or the saving of lives; 3.2.4 The advancement of citizenship or community development, which includes: rural or urban regeneration; and the promotion of civic responsibility, volunteering, the voluntary sector or the effectiveness or efficiency of charities; 3.2.5 The advancement of the arts, culture, heritage or science; 3.2.6 The advancement of amateur sport; 3.2.7 The advancement of human rights, conflict resolution or reconciliation, or the promotion of religious or racial harmony, or equality and diversity; 3.2.8 The advancement of environmental protection or improvement; 3.2.9 The relief of those in need by reason of youth, age, ill-health, disability, financial hardship or other disadvantage; 3.2.10 The promotion of the efficiency of: the armed forces of the Crown; police; fire and rescue services; or ambulance services. 3.3 The Fund is not to be used to support the following: 3.3.1 The advancement of religion; 3.3.2 The advancement of political beliefs or party politics; 3.3.3 Activities understood to be the exclusive responsibility of statutory authorities; 3.3.4 Projects benefiting primarily people out with the Area of Benefit, except in accordance with clause 2; 3.3.5 Retrospective funding (i.e. paying for costs incurred before a decision on an application to the Fund for support can be made); 3.3.6 The funding of any public or private sector compensation and / or mitigation. 2664246.1 4. The Distribution of Funds 4.1 The principal role of the Donor is to make recommendations to CFLM as to how monies held in the Fund are to be distributed. In addition, the Donor is to recommend priorities for the use of the Fund. 4.2 As the recipient of the funding (in its role as trustee for the local community) CFLM will be responsible for ensuring that the necessary governance is in place and the funds are used in a manner envisaged by the Donor. 4.3 It is CFLM policy for at least 75% of available charitable funds to be distributed annually in line with its charitable objects, and it is agreed that which the Donor and the Panel are committed to annual distributions from the Fund to this extent commit to doing so. If the Donor and Panel are unable to recommend the distribution of up to 75% of funds available in a 12 month period for charitable purposes, the funds will become discretionary funds for CFLM shall have the discretion to distribute, with prior notification to the Donor and Panel under their Fund’s criteria and purpose, the amount required in order to achieve an annual distribution of 75% of the Fund. This discretionary distribution may not take place if there are overriding arrangements that have been mutually agreed previously or an external factor, such as an extraordinary audit. 5. Responsibilities of CFLM CFLM is to: 5.1 Receive, log and assess applications/expressions of interest, enacting due diligence and considering each application’s fit with the Fund’s purposes; 5.2 Receive and hold payments into the Fund and make payments out to funding recipients; 5.3 Manage funding agreements, including monitoring projects and releasing staged payments, receipt of end-of-project reports and evaluating impact against needs identified in the community subject to the Donor’s requirements; and 5.4 Maintain all appropriate records concerning funding applied for and awarded. 6. Reporting 6.1 CFLM will provide the following reports to the Donor: 2664246.1 6.1.1 a list of all applications received, including ineligible or withdrawn applications; and 6.1.2 a statement listing payments into the Fund, amounts committed, and the current balance. 6.2 For eligible applications which are being presented for a possible funding award, an assessment report will be prepared, normally containing the following information: 6.2.1 key facts about the applicant organisation including its history of applications to / funding from the Fund; 6.2.2 a summary of the funding request; 6.2.3 CFLM’s comments regarding: (a) the applicant; (b) the proposed project and the potential impact of the funding requested; and (c) the fit with the Fund purposes or priorities; 6.2.4 a recommendation as to whether the funding is merited, and to what amount; 6.2.5 a “minimum impact” figure, below which funding would not be worth awarding; and 6.2.6 any recommended conditions.