President has cart Blanche in administering estate

Nino Arveladze

Self-government institution is a term that is indivisible part of democratic state model.

Every country claiming to have liberal democracy should have self-government institutions. In twenties of XX century, developed countries started to distribute power between self-governments. However, in XXI century, reforms carried out in Georgia in this field are quite controversial. According to European Neighboring policy Georgia is obliged to improve quality of independence of self-government institutions and to distribute power among them. Despite the fact that importance of self-government independence quality in democratic countries is widely known, none of our governments managed to strengthen self-government institutions and carry out decentralization process in the country. Central government declares that it is implementing significant reforms in the field. However, experts of Strategic Researches and Development Centre of Georgia Giorgi Toklikishvili and Shota Murgulia revealed serious imperfections in this field and presented them to the society on the seminar held at Dumas Centre on 14-th of May. Bulletin concerning problematic issues has been published with the support of Friedrich Erbert Fund.
Alienation of Main Estate is Inadmissible!
Giorgi Toklikishvili discussed the self-governing unit property formation issue. He underlined that several attempts have been made since the collapse of Soviet Union to start the process of local self-governing unit property formation. However, up today the process of property disposal to municipality is facing serious difficulties. In previous period, central government was creating image as if it was conveying property to local government. However, at the same time minimal effort has been made for this purpose. Transferring property to local government meant its strengthening and this was disadvantageous for the central government. As a result they were prolonging property conveying procedures artificially. Consequently, local self-governments had no property. Why the property should be conveyed to self-governing units? In 1997, on the basis of law on Self-government, central government empowered several exclusive rights or the part of its public rights to self governments. Correspondingly in order to effectively manage these powers municipality needed finances and relevant property. In other words, if water supply is in the competence of municipality then water system together with its estate should be owned by the municipality either. The terms of reference of the municipality cover asphalt laying and improvement of estate roads, but at the same time estate roads are not the property of municipality. After Rose Revolution, since 2005-2006 new government declared about the intention to carry out serious reforms in this field. This was expressed in merging self-governing units. Whether these steps were effective or not is another question. It is doubtless that the reform covered adoption of specific laws, including law on “Local self-government”. District self-government has been transformed into local governing organ and self-governing unit has been established. This was followed by adoption of several progressive laws. These were unprecedented steps for recent years. One of the laws adopted was “Local self-government unit budget”. According to the law adopted in 2005, there are two categories defining local self-government property: 1. Main property (here is meant real and personal estate). Expert Giorgi Toklikasjvili reckons that this is rather vogue definition for the term “Main property”, as this is the property necessary for accomplishment of self-government’s plenary powers. Mr. Giorgi Toklikashvili thinks that it would be better to use the following definition – property necessary for exclusive plenary powers. The law on self-governing property unit imperatively states that alienation of main property is inadmissible, but then it contradicts itself and states that it is admissible by the decision of two third of assemblage, in case if similar type of property will be created and initial asset loses its importance. For instance, road that was connecting one settlement of a village to another, if municipality constructs another road and the first road loses its initial destination, municipality might decide to alienate this asset. According to the law, by means of two third of votes the decision about property alienation can be made. This is a gross error. The main problem is absence of list of main property in the municipality. There is a list of main property, but it is not adopted as one document. Self-governments are pointing the main property that has been made over to self-governing units by the Ministry of Economic Development. However, there are lot of other assets that has been transferred to self-governing units, such as local forests, squares and parks. These assets are not included in the list of main property, but they have been made over to self-governing units. It is essential to include these assets in the list of main property. Otherwise, the problems might arise concerning the disposal of property. The board of administrators as executive organ should know the exact list of self-governing unit’s main property adopted and defined by the assemblage, in order to dispose it in a proper manner. If it is not clear whether some property belongs to the main property list, consequently executive government might dispose the property illegally.
2. Additional property. Law says that everything that is not the part of main property is considered as additional property and disposal of it is done in ordinary way as defined by the legislation.
Giorgi Toklikashvili declares that it is necessary assign some status to the main property of municipalities. However, municipalities do not harry to register internal roads in public register, because it is considered as main property and is not subject to sale. Conventionally, when discussing local assets Giorgi Toklikashvili declared that there can be defined two bases: disposal by the state and when self-government requests disposal of property itself. Second way of municipal property formation is when it buys or creates assets itself. Municipality has the right to purchase, create or inherit some property.
One of the main problems is connected to the legal ways of property disposal and those assets that self-governing units are requesting from the state.
What does the forest of local importance mean?
The basis is two main laws. First is the law on self-governing unit, article 47, where the land and natural resources are listed. According to the law the mentioned assets are owned by self-governing unit. The second is law on self-governing unit property. In the 2nd article, point 5 of the law is given the list of main property that has been disposed to self-governing units. The law states that the assets in the list are of local importance. These are roads, bridges, tunnels, street, underground passages, pavements, traffic signs, outdoor lighting, columns, squares, boulevards (it should be noted that they are included in the list of main assets and it is impossible to alienate them, so due regard is not given to the definitions), fountains, parks, greenery (greenery is main property, but municipalities are facing the following problem in practice – it is subject to registration as main property at public register. However, for instance if greenery is considered as main property, then after cutting it, is the created firewood and timber main property too remains unclear), buildings, forest and forest resources, agricultural and non-agricultural lands, here is meant former property accounted in balance. The property accounted in balance doesn’t mean owning it. This is quite controversial subject, as it depends on the interpretation of the definition in the law. Giorgi Toklikishvili emphasized another problem. The term – forest of local importance wasn’t defined. Therefore lawmakers declared that the forest, water resources, non-agricultural and agricultural lands, listed in 47th article of organic law should be registered in public register after the government adopts corresponding resolutions up to 1 May 2007. One of the resolutions was concerning the rule of defining forest of local importance, together with the resolution about defining water resources. If one would read the law carefully, it would become clear that there term about water of local importance is already presented in the law on water. Lots of things are written concerning the competence of local self-government and water in the law. This is the mistake of lawmakers as they failed to define this issue on time. There are some acts about self-government that need to be amended. Some terms are being changed: government or regional government and self-government terms don’t mean current self-government. Here is meant rural self-government. The term water of local self-government was presented in Georgian legislation. However, the problem was local self-government forest term. Governments’ resolutions should have defined the term – forest of local importance. The government conveyed assets of local importance to the self-government, but it didn’t specify what it was. At the same time, the right to specify what is state property and what is the property of local importance was left to the Georgian government.
Late resolutions – legal basis of forest resources’ assignation is 47th article of organic law. The law says that the forest of local importance is a property of self-government. Government delayed with the adoption of the resolution and finally adopted it on 23rd of May. The definition of the forest of local importance and the ways of its assignation has been defined in the resolution. The self-governments will be conveyed forests of former collective farms and soviet economies. The process is being coordinated by the National Environmental Agency and the Ministry of Economic Development of Georgia. Technical works will be conducted by the state committee of land utilization and protection coexisting at the National Environmental Agency. Technical works should define the resources that should be assigned. Despite the fact that the decision has been made about assignation of forests of former collective farms and soviet economies, quite a number of works were to be done by the government, such as defining borders, list of assigned areas, and the terms of assignation. After the adoption of the resolution by the committee the government should have adopted the separate resolution in separate cases. Several resolutions have been approved. At the end of whole process, the Deed of Acceptance of the property was signed by the Ministry of Economic Development, National Environmental Agency and representatives of self-governing unit. The main difficulties of transferring forest resources are lack of time and resources for inventory, old cadastre documents that do not correspond to the reality, together with law motivation of the municipalities. Due to abovementioned reasons, major portion of these processes are stopped in the municipalities. The control over the forests was not done actually.
Three statutory acts on the inventory of existing forests that were owned by the kolkhozes have been adopted since 1991 year including executive order. These statutory acts are not actually operative and nobody has taken care of the forests. Finally, municipalities were offered cut down areas of the forests. Municipalities were not refusing to accept the area. However they were demanding carrying out of full inventory.
The forests of local importance were conveyed to the municipalities, but the question is whether they are able to administer this property. The experts of the mentioned field have calculated the maintenance and training expenses at the initial stage. However, the main problem is cadastre of the forests. Specialists declare that inventory will take 2-3 years even in case of financing.
Ministry doesn’t have
the information!
47th article of organic law says that water resources of local importance have been conveyed to self-governing units. According to 67th article of the same law, by corresponding resolution government should have defined the water resources of local importance and the rule of their transferring to the municipalities. Georgian government hasn’t adopted any rule. Consequently according to the law, the water resources of local importance are not property objects. National Agency of Environment gives the following explanation: when they were charged to prepare the project of the mentioned resolution they were astonished. They didn’t have the information about the record in the organic law of 2005. According to this record the water of local self-government becomes the property of self-governing unit. The agency declared that they were working on the conception of water resources administration in Georgia. The conception foresees the management of the mentioned resources, but not their assignation to self-governing units. Giorgi Toklikishvili declared that coming out from actual situation, either government should adopt a resolution or water resources should be excluded from the list of assets to be assigned to self-government.
Conveyed or not?
There is complicated situation concerning agricultural lands. 47th article of organic law says that agricultural lands that were located on the territory owned by self-governing units have been conveyed to them. The list of exclusion is given also:
· drifts;
· Private and protected territories;
· Lands in 500 m. from border line (industrial lands are not meant);
· Lands for historical, cultural, natural and religious sites;
· Land for state forest resources;
· Land conveyed by usufruct form for easement to the institutions and legal entities of public law that are on budgetary financing.
· Land of water resources;
· Privately own land;
· Land that are subjected to privatization, according to the law on “privatization of agricultural land of state ownership”;
Another problem is that 47th article of organic law on local self-government, doesn’t define those category of agricultural lands that will not be conveyed to self-governments according to the law on “privatization of agricultural land of state ownership”.
According to the 2nd point of 2nd article of mentioned law “agricultural lands of state ownership that are either leased or unleased are subject to privatization”, in other words transferring of agricultural lands to self-governing units is fully excluded. According to 3rd article of the same law, the list of those agricultural lands that are not subjected to privatization:
· Pasture, except the pasture that was leased before the law on “privatization of agricultural land of state ownership” became operative. Pastures that are attached to the buildings that are in private ownership of physical bodies and/or in state ownership;
· Drifts;
· First belt (high security zone) of sanitary security zone of water supply facilities;
· Land of forest resources used for agricultural purposes;
· Land for recreational purposes;
· Lands for historical, cultural, natural and religious sites;
· Land of secured territories;
· Land used in a usufruct form by the institutions and legal entities of public law that are on budgetary financing.
To say in a word the pastures that were not leased before 29 July of 2005 have been transferred to self-governing organs.
Registration of agricultural lands (pastures) at public registry is becoming complicated. According to 1 point of 67th article of organic law on “Local self-governments” government should have adopted resolutions that would have defined and specified industrial lands in ownership of self-governments and the lands attached to state property (including minerals) and the lands attached to the public property with state’s share in it. In addition, with the lands subjected to attachment to the property of populated category according to the rule defined by Georgian legislation. Moreover, government should have defined specified the rule of defining forests of local importance, water resources, roads and facilities.
111 point of 67th article determines that the property listed in 47th article should be registered by self-governing unit at the public register as the rules determined in 111 point of 67th article would be elaborated. Unfortunately, no rule has been elaborated and consequently due to imperfections in the law the agricultural land conveyed to self-governing units are not registered yet.
The government that came to the power after Rose Revolution attempted to accelerate the process of reforming local self-government, and it ratified “European charter on local self-governments”. However, if taking into consideration the above-mentioned imperfections Georgian Parliament should understand that adoption of a law is not enough for successful reform.
The expert of Strategic Researches and Development Center of Georgia Shota Murgulia spoke concerning the problems of disposing property of local self-governments and government’s approach toward them. Giorgi Murgulia declared that the main task is to give independence to the self-governments while disposing local property and ensure that government doesn’t restricts its main right with elaborated rules and implemented approaches. The problems of restricting independence are arising in the process of local property privatization and its disposal. Giorgi Murgulia notes that in order to encourage decentralization process, one of the main steps is adoption of a law on “self-governing unit”. The process of property privatization has started in Georgia in 1991. Legislative base has been elaborated. However, quite a big amount of industrial and other type of property remained in the state ownership. From 2004, the process of so-called aggressive privatization was started, accompanied by significant political decisions. The aim of the process was accelerated privatization of the rest state enterprises and other type of assets. The decision concerning privatization of property in the ownership of local self-government is made by the local government. However, the rule of privatization and initial price of a property is regulated by statutory act. The property of local self-governing unit is privatized by auction and direct sale. The property is sold directly if:
· there is multitude of investments;
· The terms and alternate bids offered by the interested parties;
Shota Murgulia reckons that this recording made in the law is rather vogue and it doesn’t fully answers presented questions. To his mind, it is not right that president of Georgia on the basis of specific selection has the right to make a decision about direct sale of the property and thus avoid the mentioned procedures that are stipulated by the law on state property and “privatization and disposal of a property owned by local self-governing unit”. This gives a complete discretion to the president in property disposal.
The law on “state property and privatization and disposal of property owned by local self-governing unit” determines the rules of privatizing state ownership and an organ conducting this process. This is Ministry of Economic Development of Georgia. The 4th article of the mentioned law defines the list of state ownership that is not allowed to alienate.
· Minerals;
· Water resources;
· Territorial waters;
· Continental shelf;
· Forest resources;
· Airspace;
· State reserve;
· National park;
· Nature reserve;
· Suppressed;
· Objects of historical-cultural and art value defined the corresponding rule; Building of cultural and art purposes; The mentioned object are not allowed to privatize without corresponding terms and agreement of the Ministry of Culture;
· Religious and public worship buildings (operative and non-operative), their ruins, land spots where they are located;
· State Archives of cultural and historical importance;
· State fund of movie, photo and pono documents of special importance;
· Archives and funds of special importance of Georgian Ministries and scientific-research institutions;
· Museum collections, funds of special importance;
· House-museums of special importance;
· The property conducting dispatching of electricity sector;
· The property owned by legal bodies of public law, such as public schools, higher education and scientific institutions;
· Moorages of the ports of special importance, hydro technical buildings, beacons, and water area;
· Gas main
· Highways (in case of absence of the alternate road);
· The means of air transportation, management and control;
· The landing strips;
· Spectrum of frequencies;
· The positions of Georgia at geostationary orbit;
· Public pantheon
· The property conveyed to Prosecutor’s Office, Ministry of the Interior and Defense for accommodation purposes as defined by the law;
Non-alienated state property list has been amended in 2008. The railway of state importance has been excluded from the list and systems of alarm, telecommunication, dispatching and energy supply. The buildings of water supply systems, water pumping stations and pipeline mains, main collectors of collecting system and regional cleaning stations have been excluded from the list of non-alienated state property list. Naturally, the reader might have his own opinion – what are the plans of the state and what it is going to privatize. Up to 2007, Georgian railway was considered as the object of strategic importance and its privatization was not allowed. Shota Murgulia categorically notes that it is inadmissible to alienate property of strategic importance, especial it sale to the legal body controlled by our Northern neighbor, in the times when Russian capital is propagating in Georgia and government considers Russia as its bloody enemy. Shota Murgulia underlines another neglecting – the drifts for the cattle; Land of forest resources; first belt of sanitary protection and recreational lands are not included in the list of non-alienated property. In other words, it is possible to privatize them. Shota Murgulia emphasized the issue of conveying the property owned by the self-governing unit. The rule written in the law can be interpreted by the lawyers in two ways and thus arouses big problems.
According to the first prime point of third article of the law on “state property and local self-governing unit property privatization and servitude disposal” executive office of local self-government establishes non-commercial legal entity on the basis of local self-governing unit property. In accordance with the record, when founding non-commercial legal body, self-governments are allowed to consider corresponding part of local property as the property of non-profit legal body. Legally unjustified procedure enables local self-governments to establish preschool institutions as non-commercial legal bodies. Due to this, in recent years almost every self-government registers kindergartens as NLBs, while their financing is made from the budgets of local self-governments.
Once again we are convinced that the laws adopted promptly and without relevant discussions make it impossible to carry out reform. This draws justified criticism from the society. Unfortunately, Georgia has never had government that would love criticism. Strong self-governments are necessary for developing strong civil society and correspondingly budgetary issues of self-governments are first to be solved.