Budget freedom asks for emergency housing

The Ministry of Construction proposes to allow the Territorial Development Fund to start construction under emergency housing resettlement programs, which the regions are required to co-finance, only with federal money – the constituent entities of the Russian Federation will be able to make their share of budget investments later. This will make it possible not to delay the start of projects for the resettlement of citizens in those regions where the budgetary situation does not allow fulfilling the current requirements for their participation in emergency resettlement programs. The decision, we note, looks ambiguous from a budgetary point of view – it increases the deferred obligations of the regions; however, the president demands to accelerate the implementation of the “emergency emergency” resettlement programs, and the launch of new construction projects may spur the sagging construction of apartment buildings.

The Ministry of Construction published a draft government decree allowing the Territorial Development Fund (TDF), which absorbed, among other things, the Housing and Communal Services Fund and funds for the resettlement of emergency housing, to begin construction of new projects for the resettlement of emergency housing at the expense of its free funds, without waiting for the regions participating in the programs to contribute their share of co-financing of such projects, provided that the regions then bring the total proportions of project financing to the current requirements.

Now, we recall, the share of subjects in solving the problems of dilapidated housing should be 14% of its value. As the explanatory note to the project of the Ministry of Construction admits, “circumstances arise in which the budgetary funds of the constituent entities of the Russian Federation necessary to co-finance the activities of the resettlement program stage are not enough at the time of concluding contracts, for example, in the first year of the resettlement program stage”. Moreover, the fund records a practice in which in a number of regions the start of the program is already financed only at the expense of the FRT, which causes a temporary excess of the standard of its costs in terms of a square meter, but then, until the end of the year, the constituent entities of the Russian Federation contribute their share of co-financing projects, and the final parameters of such constructions come in line with the requirements of the legislation.

Therefore, the FRT is proposed to legalize the practice of exceeding the standard for the estimated participation of the fund in the construction of a replacement for dilapidated housing “in the case when the source of financing for such an excess is savings from the fund, and (or) in the case when such an excess allowed under one contract is compensated at the expense of funds the budget of the constituent entity of the Russian Federation, funds of local budgets used to pay for other contracts”, while the assessment of the fulfillment of these requirements “is proposed to be carried out following the completion of the next stage of the resettlement program, within which contracts were concluded”.

It should be noted that the president demands to accelerate the implementation of the resettlement program – “try to complete it by the end of 2023”, for this it was included in the national projects. As Konstantin Tsitsin, head of the Housing and Public Utilities Fund, told in an interview with Kommersant, some regions use the reverse mechanism, increasing investments in emergency gang resettlement projects, but about ten constituent entities of the Russian Federation are behind the plan. Probably, the fund’s project is focused primarily on the launch of new construction within the framework of the program in them. This, we note, can support the construction of apartment buildings, which is sagging against the backdrop of a mortgage recession (see Kommersant of July 18 and August 19), and the risks of postponing the “regional share” in such projects for future periods and the accumulation of budget obligations by lagging regions, apparently, are assessed as not very serious against this background.

Oleg Sapozhkov