On General Principles of Developing Intergovernmental Fiscal Relations in Tver Oblast as of 2005

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Presentation

• On General Principles of Developing
  Intergovernmental Fiscal Relations in Tver Oblast
  as of 2005

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The System of Funds for Financial Support
The Fund for Financial Support, Objective
equalization of fiscal capacity of municipalities
The Fund for Local Finance Stabilization,
Objective partial compensation of losses to
municipal budgets sustained due to the migration
to a new system of intergovernmental fiscal
relations.
Social Expenditures Co-Financing Fund,
Objective subsidies to the most important and
high-priority expenditures in local budgets.
Municipal Development Fund, Objective shared
financing of municipal programs and investment
projects that are crucial for development of the
region.
The Fund for Municipal Finance Reform,
Objective competitive allocation of subsidies
to municipalities that implement their reform
agendas
Compensatory Fund, Objective to finance
subventions to implement federal and regional
laws that relate to social sector.
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Composition of Funds for Financial Support
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Expenditure Co-Financing Fund
Co-Financing Objectives
Conditions of obtaining funds
Unified allocation technique
Allocation to municipalities (approaches)
Appendix to the law On the Regional Budget
Financing based on the subsidy extension
procedure
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• Social Expenditures Co-Financing Fund
• The Social Expenditures Co-Financing Fund covers
  expenditures that
• 1. Belong to local jurisdiction
• 2. Presuppose a blanket allocation of resources
  among all (or almost all) municipalities.
• In order to allocate the resources from the
  Social Expenditures Co-Financing Fund, it is
  necessary to establish
• 1. Specific expenditure areas where SECF
  allocations will go
• 2. The size of SECF assistance allocated to each
  of the areas
• 3. Conditions for municipalities to be eligible
  for SECF resources to each of the expenditure
  areas
• 4. A technique to allocate SECF assistance to
  each of the areas, including
• the group of assumed beneficiaries
• adjustment factor for the cost of service
  provision
• co-financing needs (fiscal capacity) indicator.

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Social Expenditures Co-Financing Fund

• Subsidies to cover expenditures needed to operate
  social and cultural sector facilities
• Subsidies to cover expenditures in the
  Education area
• to deliver fire safety measures at educational
  facilities
• to perform major rehabilitation of educational
  facilities
• Subsidies to cover expenditures in the Health
  Care area
• to provide special dairy products to children
  (1-2 years old) free of charge
• Subsidies to cover expenditures in the Culture
  area
• to perform major rehabilitation of culture
  facilities
• to deliver cinema shows to children and rural
  population
• Subsidies to cover expenditures needed to support
  district and city-level mass media
• Subsidies to support expenditures in the Housing
  and Utilities Services area
• to subsidize services provided by heat suppliers
• Subsidies to cover road maintenance expenditures
  of municipalities
• Subsidies to cover expenditures needed to support
  detoxication centers
• Subsidies to cover maintenance and repairs of
  military cemeteries.

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Municipal Development Fund
Projects and programs selection criteria
Requirements to applications
Priorities as spelled in regulations
Bidding process
Winners projects and programs
A separate line in the law On Oblast Budget
Financing based on the subvention extension
procedure
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MUNICIPAL DEVELOPMENT FUND The Municipal
Development Fund covers expenditures that 1.
Belong to local jurisdiction 2. Call for capital
provision to finance public infrastructure
projects in municipalities 3. Call for
pinpoint allocation of resources among the most
efficient projects and programs. In order to
allocate the resources from the Municipal
Development Fund, it is necessary to establish
1. Clear expenditure areas in which MDF grants
will be allocated (sectoral structure of the
MDF) 2. The size of MDF grants allocated to each
of the specific areas 3. Criteria used to
allocate MDF resources to each of the areas in
addition to those spelled out in the draft law on
the Fund 4. A methodology to identify winners of
the bidding process for each of the areas
(point-based of r any other approach).
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The System Used to Finance the Government
Standard of General Education (2005) Out of
Oblast Budget
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CALCULATION OF SUBVENTIONS FROM THE COMPENSATORY
FUND TO SUPPORT GUARANTEED RIGHTS TO FREE
ELEMENTARY, BASIC, SECONDARY (COMPLETE) GENERAL
EDUCATION IN 2005 (approved by Law of Tver
Oblast On Oblast Budget of Tver Oblast for
2005)
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