Further Information : JESSICA
Joint European Support for Sustainable Investment in City Areas (JESSICA) is a new policy initiative of the European Commission, supported by the European Investment Bank
JESSICA responds to the request by several Member States and the European Parliament to give special attention to the need for renewal and/or regeneration of certain urban areas.
The main objectives of JESSICA are:
- To help the authorities in the Member States of the European Union exploit financial engineering mechanisms to support investment in sustainable urban development in the context of cohesion policy
- To provide new opportunities to Managing Authorities responsible for the next generation of cohesion policy
Underproposed new procedures, Managing Authorities in the Member States will be allowed to use some of their Structural Fund allocations - principally those supported by the European Regional Development Fund and, where appropriate, the European Social Fund - to invest in Urban Development Funds (UDF) to accelerate investment in urban areas.
Other International Financial Institutions, as well as the European banking and private sector, are also expected to follow suit. The Council of Europe Development Bank has already agreed to participate.
How JESSICA works
JESSICA allows the use of interim payments from Managing Authorities from Structural Funds through recyclable and recoverable financial mechanisms, essentially equity, guarantees and subordinated loans. Recovered funds may be reinvested through UDFs or returned to the Managing Authority to support other urban projects, including through conventional subsidies.
UDFs may take administrative forms and be devoted to investments in different areas. Their common features are a market-driven approach, as they are expected to at least recover their investment in projects within well-defined integrated urban renewal and development plans.
JESSICA offers new opportunities for the use of Structural Funds for the integrated development of urban areas and allows a continuous availability of funds for revenue generating components of urban renewal and development programmes. Building on a market-driven approach that is essential for the success of UDFs, the Structural Funds used in JESSICA are expected both to leverage substantial amounts of investment into areas in need of social cohesion and to speed up their transformation.
More information on JESSICA can be found on the European Commission website
Opportunities for Scotland
The Programme Monitoring Committee (PMC) has agreed to allow the Scottish Government Managing Authority to explore further the possibilities offered by the JESSICA initiative to fund urban development in Scotland. Following further dialogue with the European Commission and the European investment Bank (EIB) it is clear that both partners are concerned about funding a general study on how JESSICA would operate in Scotland.
The Managing Authority are looking to running a call for applications initially based around expressions of interest. This call will be limited to Local Authorities eligible under ERDF Priority 3, Urban Regeneration Companies and National Bodies such as Scottish Government Directorates and Scottish Enterprise. To support this process information seminars will be held in Scotland in late 2008 to allow interested parties to raise questions or issues.
The JESSICA Update Paper that was presented to the PMC in July 2008 is now available for download.
For more information on JESSICA in relation to the Lowlands and Uplands Programmes please contact Susan Tamburrini
