Scottish Government

To score a 'High' you should demonstrate that, in addition to support from Rural Priorities (RDC-RP), you will secure other non-public funding sources to deliver more of the proposed activity. You should show that:

• this provides either greater public benefit or reduces the cost to RDC-RP;
• these other non-public funding sources, which can include your own resources such as your own finance or labour, will deliver a discrete but integral part of the proposal.
• this investment is essential to the project, and that it is not merely a token additional amount;
• the work must be eligible for RDC-RP funding and meet the eligibility requirements under the Rural Priority Option(s) you have selected.

For projects where the RDC-RP funding contribution is less than 100%:

Applicants must demonstrate that they are investing about 10% of the complete cost of the work proposed under the chosen Regional Priority, over and above the grant rate, including the cost of the work to be set against Leverage. The relevant % RDC-RP contribution will be applied to the net cost of the project i.e. the complete cost of the project less that set against Leverage. For example, a shed costs £100,000 and associated concreting works cost £15,000, giving a complete cost of £115,000. If the applicant funds the concreting, this will be a 13% contribution. Grant will be awarded against the net cost of £100,000.

For projects where the RDC-RP funding contribution is 100% (e.g. agri-environment cases):

Applicants must demonstrate that they are investing about 10% of the complete cost of the work proposed under the chosen Regional Priority, including the cost of the work to be set against Leverage (see agri-env example below). Only eligible capital items may be put forward for Leverage. Annual recurrent options are not eligible as leverage.

The 10% contribution is a guideline only. Case Officers should apply their professional judgement. Where it is clear that a high quality proposal has been submitted but the leverage target of 10% is set too high then Case Officers may revise this downwards, providing an appropriate justification with their assessment and highlighting the issue to the RPAC.

Applicants must clearly describe the work to be set against Leverage in the Proposal documentation, locating the works on a map if appropriate, and provide a clear breakdown of costs including quotations where appropriate.

Work which has already been undertaken, or will be undertaken prior to issuing of a RDC-RP contract, will not be eligible to be set against Leverage.

Case Officers should highlight the work set against Leverage in the Points to Note section of the RDC-RP contract and spell out that the leverage work needs to be completed and carried out to the same standard as that being paid, or as specified in the option web guidance, and must be paid for before any grant can be paid. Applicants must provide evidence to demonstrate completion of the work set against Leverage at the time of any capital claim, including receipted invoices and/or timesheets if appropriate.

For example:

• Applicant seeks RDC-RP funding for a new shed. Applicant undertakes to fund the entire cost of installing the water supply and the internal livestock handling infrastructure necessary to put the shed to the desired use.
  • Total Regional Priority Value (Total Capital Cost of Shed incl water supply and internal livestock handling facility)= £100000.00
  • Total Leverage Capital (Cost of water supply and internal livestock handling facility) = £20000.00
  • Leverage % = Leverage Capital/Total Regional Priority Value x 100 = 20%
  • Grant awarded against net cost of £80000.00
• Community applicant seeks RDC-RP funding for a new community building. The applicant undertakes to fund the entire cost of installing the heating system or kitchen etc using other resources (so long as these amounted to a significant proportion of the total cost of the building i.e. around 10% of total eligible costs).
• Applicant undertakes the capital works associated with agri-environment proposals so long as the work is undertaken to the standard cost item specification and after the RDC-RP contract has been signed. E.g.
  • Applicant proposes to undertake three management options under RP08; Coastal Heath, Open Grazed Grassland and Grazed Grassland for Corncrake with associated fencing and gates to be paid for by applicant and used as leverage;
  • Total Annual Recurrent = £10095.00
  • Total Capital (fences and gates) used as leverage = £1500.00
  • Total Regional Priority Value (Total Annual Recurrent and Total Capital) = £11595.00
  • Leverage % = Leverage Capital/Total Regional Priority Value x 100 = 12.94%

Examples which would not be eligible for Leverage:

Capital expenditure being used as leverage while at the same time being claimed as part of eligible expenditure. E.g.

• Applicant proposes to erect a shed, total cost £100000.00 including supply, erection and ground works.
  
• Against the leverage criteria he claims that he will carry out the ground works totalling £10000.00 at his own expense.
  
• However when the eligible expenditure in the schedule of works is checked he has entered all ground works as eligible costs.

The project as a whole remains eligible; at an eligible cost of £100000, but the project would not score for leverage. If this is discovered before the proposal is committed the applicant may choose to amend the proposal by removing the proposed leverage from the eligible costs.

Likewise

• Ineligible costs being claimed as leverage. E.g. a farmer is expanding his dairy business, he includes the total project costs as :-
  • additional livestock accommodation £100000.00,
  • additional slurry storage £50000.00,
  • additional feed storage £50000.00,
  • purchase of additional stock £40000.00.
• The total project cost is shown as £240000.00 of which £40000.00 for livestock is claimed as leverage. However as the livestock would not be eligible for RP funding despite being integral to the project they cannot be used as leverage. The project as a whole remains eligible, but at an eligible cost of £200000.00, and will not score for leverage.