Subsidies for friendship – Economics – Kommersant

The Ministry of Economy published on regulation.gov.ru a draft government decree “On approval of general requirements for the procedure for concluding agreements on interregional and intermunicipal cooperation for the joint development of infrastructure.” Despite the technical name, the document is intended to resolve significant problems in the development of urban agglomerations, which ten years ago were recognized as the “flagship” of urban progress and spatial development in the Russian Federation. The lack of regulation in which neighboring municipalities or regions are invited to agree on joint development (primarily Moscow and the region, St. Petersburg and the region and the Ural industrial cities) slows down this process, and the Ministry of Economy is trying to solve this problem.

Explaining the reasons for the development of requirements for the contractual process of municipalities on joint work on the development of urban agglomerations, the Ministry of Economy notes that such formations are recognized by the Spatial Development Strategy of the Russian Federation as a “global trend in spatial development”, territories of advanced development and points of economic growth. However, “at present, the creation of an urban agglomeration, as a rule, is accompanied by amalgamation into a single municipal formation with the status of an urban district or centralization of powers at the level of a constituent entity of the Russian Federation,” which, in turn, “means for local governments a waiver of their own powers.”

Instead, the Ministry of Economy suggests municipalities to develop horizontal agreements. “The approval of the document will create a legal basis for concluding agreements and outline the general framework for them,” said Dmitry Vakhrukov, deputy head of the Ministry of Economy. The creation of additional opportunities for the infrastructure development of urban agglomerations, according to him, can, in turn, significantly stimulate their socio-economic development by pooling resources to create common communal, social, and transport infrastructure facilities. In order to provide financial support for such cooperation, amendments are made to the Budget Code in parallel – according to them, the obligations of regions and municipalities arising from the conclusion of agreements on interregional and intermunicipal cooperation for the joint development of infrastructure can be covered by “horizontal” subsidies between regional and municipal budgets.

“The proposed instrument of agreements fine-tunes the mechanism of horizontal subsidies and removes another administrative barrier. This may give the territories a little more freedom in the implementation of joint projects. Regions and municipalities have been able to implement horizontal subsidies for several years. At the same time, their widespread practice did not develop – the grounds for their use were ambiguous, all the time there was a risk of accusing the authorities of misappropriation of funds, ”says Dmitry Zemlyansky, director of the Research Center for Spatial Analysis and Regional Diagnostics of the Institute for Applied Economic Research of the RANEPA. Ilya Lagunov, deputy head of the “Spatial Development” direction of the Center for Strategic Development, agrees with him: “At the moment, it is not necessary to talk about the already existing significant amount of such interaction between regions and municipalities, since there is no common approach to this decision and the experience of law enforcement of ready-made solutions has not yet been formed . With the advent of general requirements for the conclusion of agreements, systematized data will appear. In turn, for the development of the topic of cooperation as a whole, it is necessary to search for incentives for the implementation of joint projects. On the one hand, this could be a refinement of legal regulation with the removal of obstacles, and on the other hand, additional co-financing from the state for the implementation of projects.”

Recall that the construction of “municipal districts” mentioned in the explanatory note and the consolidation of municipalities were the main motive for the reform of public administration in 2018 – its goal was to embed the municipal level in the vertical of power in order to be able to control the implementation on the ground of the then adopted system of national goals and national projects. The “excessive” independence of the municipal authorities from the point of view of the center did not allow guaranteeing the implementation of federal plans in specific territories, the Charter of Local Self-Government signed by the Russian Federation, according to which municipal issues should be resolved “on the ground”, and not by the authorities of the subject or federation. As a result, the concept of “aggregation of municipalities” was implemented in the Russian Federation, which provided the controllability necessary for the center, but irritated the local authorities due to their forced renunciation of some of their powers. Probably, the reason for the inactive cooperation of municipal authorities in the development of urban agglomerations is due to this, and the proposal of the Ministry of Economy allows them to work on such projects, while maintaining independence. As a result, according to a source in the department, “a common legal framework is being formed in the existing structure of interbudgetary relations” – the goal is “not to influence the organization of public authorities.”

Oleg Sapozhkov