GEO

Municipal Services Work in Rental Properties

29 October, 2019

 

A number of municipalities rent properties to exercise their duties, while other municipalities use state-owned properties.

Transparency International Georgia has requested information from all municipalities of Georgia, except Tbilisi, on the ownership of the buildings where the City Hall, the City Council and/or other municipal-funded institutions are located.

According to the information that we received, 22 out of the 63 municipalities do not have a sufficient number of properties to carry out their duties.

The Tsalka Municipality is the only municipality that does not even own the building in which its City Hall / City Council is based and instead uses a state-owned property for free. In certain cases, municipalities have to rent a property for the operation of kindergartens, individual services, and municipal legal entities.

Refer to the chart for detailed information:

The low level of decentralization in Georgia is a significant problem, as the local governments do not possess sufficient financial resources and property. Moreover, the state has ownership of the more real estate in municipalities than the local self-government.

The lack of sufficient property significantly hinders local economic development, impedes the delivery of municipal services, as well as making it more expensive. Moreover, in many cases, municipalities are deprived of the opportunity to use the property on their territory to receive more income.

The government is currently working on a decentralization strategy for 2019-2025 and an action plan for 2019-2020, but it is still unclear what kind and amount of property might be transferred to the ownership of the local self-governments.

"Transparency International Georgia" calls on the Parliament and the Executive Government to take meaningful steps to strengthen local governments and transfer ownership of all property to the municipalities, which, on one hand, are necessary to for them to carry out their responsibilities, and on the other hand, give the municipalities the opportunity to receive more income.

It is also alarming that according to established practice, municipalities rent a building with the through a lease agreement with the owner of the desired building, which creates risks of a corrupt deal. To mitigate this risk, it is necessary to establish a better standard and select the property required for the exercise of specific duties through a public announcement, procurement and/or request for quotation, which will ensure transparency of the process, as well as bring about potential cost savings for the self-government.