A Memorandum of Understanding (MOU) is a signed non-obligating and legally non-binding document that describes the intentions of the alliance members to work together to address a shared development challenge. In some cases, companies (and particularly their legal departments) may use the term MOU to refer to a legally binding document. In this situation it is imperative that all parties understand and agree that the document is non-legally binding; if helpful, you may change the term “MOU” to a term used by the organization to refer to a non-legally binding document (e.g., “letter of intent” or “partnership agreement”).
Do I Need To Have A MOU For My Public-Private Partnership?
MOUs are not required for public-private partnerships, but they are strongly recommended. They are frequently used when USAID and a resource partner are providing parallel funding to a common implementing partner. They are not typically used when a resource partner is receiving USAID funds through a Collaboration Agreement, because the Collaboration Agreement itself addresses the kind of information set forth in an MOU. They are also typically not used when the alliance consists only of a gift from a resource partner to USAID, where the resource partner is providing no other in-kind contributions and does not expect to be involved in the alliance activities. Consult with your Regional Legal Advisor or the General Counsel’s office to determine whether a MOU is appropriate for your proposed alliance.
What Are The Benefits Of Using A MOU?
There are many benefits to formalizing your partnership through a MOU. The MOU
- Ensures that all parties are in agreement on the partner roles and activities, thereby decreasing misunderstandings and future conflicts.
- Outlines how decisions about the partnership will be made during implementation.
- For many alliances, represents the only document that formalizes the relationship between USAID and a private sector partner (that is not also an implementer).
- Can help keep the partnership on track and focused on the original objectives/activities.
- Provides an easy framework to allow additional partners to join and expand the partnership.
The key words here are ‘non-obligating and legally non-binding document‘ and it seems the city is moving forward with MOUs when it comes to financially supporting special interests and club sports. This is unfortunate. Why? Because when these ‘groups‘ don’t come up with the money they promised to raise there is NOTHING legally binding them to come up with it. What does that mean? That means taxpayers are on the hook for the shortfalls. Councilor Staggers suggests that we get away from MOUs and require the clubs to ‘show us the money’ before we cut them a check, he says it is about ‘Accountability’. Of course Donny K. doesn’t have a problem with them, well, because it’s not his money that is on the hook when these ‘groups’ fail to hold up their end of the deal. I think the whole conversation ended perfectly with Staggers telling Donny K. “Then they better get it together.”