Procedures by which State Earmarked Subsidies are to be Granted to Local Governments for Solving Apartment Matters

Issued pursuant to
Section 28, Paragraph two of the
Law On Assistance in
Solving Apartment Matters

I. General Provisions

1. These Regulations prescribe the conditions for the granting of State budget earmarked subsidies (hereinafter - earmarked subsidies) and the procedures by which local government requests for the construction of residential houses, the renovation of non-rented residential houses, the conversion (reconstruction) of buildings into residential houses, the completion of newly erected apartment houses (the construction work of which has been suspended) or the acquisition of separate apartment properties for the ensuring of the permanent function of local governments - the provision of assistance to residents in the solving of apartment matters - shall be evaluated.

2. In accordance with these Regulations the following may qualify for earmarked subsidies:

2.1. local governments in the territory which there are registered persons for whom assistance in solving apartment matters is to be provided in the first instance (data of the assistance register); and

2.2. local governments, which have entered into an agreement regarding co-operation in the solving of apartment matters if at least in one of the local governments there are registered persons for whom assistance in solving apartment matters is to be provided in the first instance.

[21 March 2006]

3. Earmarked subsidies shall be granted to local governments:

3.1. for the construction of social residential houses - in the amount of 30 % of the construction costs;

3.2. for the construction of local government tenement houses - in the amount of 30 % of the construction costs;

3.3. for the construction of tenement houses performed jointly by a local government and commercial company - in the amount of 20 % of the construction costs;

3.4. for the conversion (reconstruction) into residential houses of buildings owned by a local government or the completion of newly erected apartment houses (the construction work of which has been suspended ), or for the renovation of non-rented residential houses - in the amount of 30 % of the reconstruction (renovation) costs;

3.5. for the conversion (reconstruction) of buildings into residential houses performed jointly by a local government and commercial company or the completion of newly erected apartment houses (the construction work of which has been suspended), or for the renovation of non-rented residential houses - in the amount of 20 % of the reconstruction (renovation) costs; and

3.6. for the acquisition of separate apartment properties - in the amount of 30 % of the acquisition value, but not more than five thousand lats.

4. Earmarked subsidies shall be calculated, taking into account the following construction costs, if it has not been provided for otherwise in these Regulations:

4.1. for the construction referred to in Sub-paragraphs 3.1, 3.2 and 3.3 of these Regulations - up to 350 lats per square metre; and

4.2. for the construction referred to in Sub-paragraphs 3.4 and 3.5 of these Regulations - up to 250 lats per square metre.

[21 March 2006]

5. Within the meaning of these Regulations, construction costs shall not include the costs for territory development work and external engineering and communication systems.

6. In order to calculate an earmarked subsidy, the construction costs referred to in Paragraph 4 of these Regulations shall be revised each year, taking into account the increase in inflation in the State.

7. The right to qualify for an earmarked subsidy:

7.1. local governments, in the territory of which more than 30 persons are registered in accordance with Section 14 of the Law On Assistance In Solving Apartment Matters, have the right for the implementation of the measures referred to in Sub-paragraphs 3.1, 3.2, 3.3, 3.4 and 3.5 of these Regulations, or local governments, which have entered into the agreement referred to in Sub-paragraph 2.2 of these Regulations if at least one of them conforms to the criteria specified in this Sub-paragraph; and

7.2. local governments, in the territory of which less than 30 persons are registered in accordance with Section 14 of the Law On Assistance In Solving Apartment Matters, have the right for the implementation of the measure referred to in Sub-paragraph 3.6 of these Regulations.

[21 March 2006]

II. Submission of Applications and Documents

8. Local governments shall submit information to the Ministry of Economics (hereinafter - Ministry) each year until 1 May in accordance with the Annex of these Regulations.

[2 January 2007]

9. The Ministry shall calculate the percentage amount of an earmarked subsidy for each planning region (hereinafter - region), taking into account the number of persons registered in the relevant region who are to be ensured with residential premises first and foremost, but not more than 50 % of the total amount of an earmarked subsidy for one region.

10. Local governments that plan to implement one of the measures referred to in Sub-paragraphs 3.1, 3.2, 3.3, 3.4 or 3.5 of these Regulations in the following budget year shall submit to the Ministry the following documents in the time period specified in Paragraph 8 of these Regulations:

10.1. a decision of the local government regarding the implementation of the particular project and a request prepared on the basis thereof (indicating the amount of financial participation of the local government);

10.2. information regarding the number of persons registered in the local government who are to be ensured with residential premises first and foremost;

10.3. a statement that certifies that the local government does not have tax debts and which the State Revenue Service has issued not earlier than one month before the submission of documents to the Ministry;

10.4. a schedule of the obligations of the local government;

10.5. a planning and architectural task; and

10.6. an agreement regarding co-operation in the solving of apartment matters if the local governments have agreed regarding the implementation of one common project.

[21 March 2006]

11. If a local government intends to perform construction jointly with a commercial company, such local government shall submit the following documents in addition to the documents referred to in Paragraph 10 of these Regulations:

11.1. information regarding the amount of the intended financial participation of the commercial company;

11.2. the annual report of the commercial company for the previous two years;

11.3. information regarding the State compulsory social insurance contributions from the income of employees made by the commercial company and the average number of workers (for the previous two years); and

11.4. a statement that certifies that the commercial company does not have tax debts or State compulsory social insurance contribution debts and which has been issued by the State Revenue Service or another tax administration institution in Latvia or an equivalent tax administration institution in another state in which the private entrepreneur (commercial company) has been registered, not earlier than one month before the submission of documents to the Ministry.

12. Local governments that plan to implement the measure referred to in Sub-paragraph 3.6 of these Regulations in the following budget year, shall submit the following documents to the Ministry in the time period specified in Paragraph 8 of these Regulations:

12.1. a decision of the local government regarding the acquisition of apartment properties in the following year;

12.2. information regarding the number of persons registered in the local government who are to be ensured with residential premises first and foremost; and

12.3. a schedule of the obligations of the local government.

III. Participation of Local Governments

13. The amount of financial participation of a local government in implementing the projects referred to in Sub-paragraphs 3.3 and 3.5 of these Regulations shall not be less than the co-financing granted by the State.

[21 March 2006]

14. Requests for the acquisition of separate apartment properties from one local government shall not exceed 20 thousand lats in total per year.

IV. Evaluation of Documents

15. The State agency "Housing Agency" (hereinafter - Agency) shall aggregate and examine the requests and documents submitted by local governments in accordance with the instruction issued by the Minister for Economics (hereinafter - Minister).

[2 January 2007]

16. The documents referred to in Paragraphs 10, 11 and 12 of these Regulations shall be examined in accordance with the order of submission within a time period of one month beginning with the day of the receipt thereof.

17. Within a time period of one week after an examination of documents, the Agency shall submit a report to an evaluation commission established by the Minister (hereinafter - commission) regarding the compliance of the documents submitted by local governments with the requirements of these Regulations. The commission shall take a decision regarding the inclusion of the relevant local government in the list of applicants for an earmarked subsidy or a refusal to grant an earmarked subsidy.

18. The commission has the right to request additional information from a local government that has submitted a request and documents for the receipt of an earmarked subsidy before the taking of a decision and to specify the time period for the submission of additional information.

V. Conditions for the Receipt of Earmarked Subsidies

19. After the approval of the total amount of earmarked subsidies in the Law On the State Budget for the Current Year, the Ministry shall clarify the percentage amount of earmarked subsidies to be granted to each region and inform the local governments that are included in the list of applicants regarding such amount within a time period of two weeks.

20. Earmarked subsidies shall be granted to local governments in accordance with the order of the registration of requests within the framework of the earmarked subsidy calculated for the relevant region.

21. In order to receive an earmarked subsidy for the measures referred to in Sub-paragraphs 3.1, 3.2, 3.3, 3.4 and 3.5 of these Regulations, local governments shall submit to the Ministry the following documents within a time period of two months after the receipt of a notification of the Ministry:

21.1. a building design and calculation (estimate) of costs developed and accepted in accordance with the requirements of the regulatory enactments regulating construction;

21.2. if the local government has decided to take a loan in order to participate in construction, a permit for the taking of the loan received in accordance with the specified procedures;

21.3. a plan for the management and maintenance of the building, as well as information regarding the amount of rental payment for residential premises;

21.4. a statement that certifies that the local government does not have tax debts and which has been issued by the State Revenue Service not earlier than one month before the submission of documents to the Ministry; and

21.5. a schedule for the performance of construction works.

21.¹ If several local governments implement one common project, the documents referred to in Sub-paragraphs 21.2 and 21.4 of these Regulations, shall be submitted by each local government separately.

[21 March 2006]

22. If a local government and a commercial company perform construction jointly, in addition to the documents referred to in Paragraph 21 of these Regulations the local government shall submit a statement that certifies that the commercial company does not have tax debts or State compulsory social insurance contribution debts and which has been issued by the State Revenue Service or another tax administration institution in Latvia or an equivalent tax administration institution in another state in which the private entrepreneur (commercial company) has been registered, not earlier than one month before the submission of the documents to the Ministry.

23. In order to receive an earmarked subsidy for the measure referred to in Sub-paragraph 3.6 of these Regulations, local governments shall submit the following documents to the Ministry:

23.1. a document that certifies the agreement of the alienor and local government regarding the procurement of the apartment property;

23.2. a statement prepared by an independent certified assessor of immovable property regarding the value of the relevant apartment property; and

23.3. a statement that certifies that the local government does not have tax debts and which has been issued by the State Revenue Service not earlier than one month before the submission of the documents to the Ministry.

VI. Requirements for Projects

24. The following shall be provided for in a building design:

24.1. an accountancy system of centralised heat supply and water supply in accordance with actual consumption;

24.2. environment-friendly construction products of good quality, the compliance of which is certified in accordance with the procedures specified by the Law On Conformity Assessment;

24.3. the accessibility of housing (at least on the first floor of the building) for disabled persons with restricted movement capabilities; and

24.4. the useful area of the building is not less than 1 000m², and the total number of apartments in the building are not less than 30. This restriction shall not be applicable to the construction provided for in Sub-paragraphs 3.4 and 3.5 of these Regulations.

VII. Evaluation of Documents

25. The commission shall examine the documents referred to in Paragraphs 21 and 22 of these Regulations within a time period of three days, but the documents referred to in Paragraph 23 of these Regulations - within a time period of one week after the receipt thereof, and shall take a decision regarding the granting of an earmarked subsidy or a refusal to grant an earmarked subsidy.

26. The commission shall take a decision regarding a refusal to grant an earmarked subsidy if all of the information specified in these Regulations or requested by the commission has not been submitted or if the earmarked subsidy cannot be granted to the local government.

27. The Ministry shall send a decision of the commission regarding the granting of an earmarked subsidy or a refusal to grant an earmarked subsidy to the relevant local government within a time period of five working days.

VIII. Granting of Earmarked Subsidies

28. If the commission has taken a decision regarding the granting of an earmarked subsidy for the implementation of the measures referred to in Sub-paragraphs 3.1, 3.2, 3.3, 3.4 or 3.5 of these Regulations, the local government has a duty to submit to the Ministry the following documents:

28.1. information regarding the results of the procurement of the local government (a copy of the procurement contract); and

28.2. a calendar plan of construction work.

29. After the receipt of the information specified in Paragraph 28 of these Regulations, the Minister shall issue an order regarding the granting of an earmarked subsidy to the relevant local government within a time period of five working days, except for in the case referred to in Paragraph 36 of these Regulations.

30. The Minister shall issue an order regarding the granting of an earmarked subsidy for the acquisition of separate apartment properties (Sub-paragraph 3.6) within a time period of five working days after the commission has taken a decision regarding the granting of the earmarked subsidy.

31. If in accordance with Section 4, Paragraph two, Clause 4 of the Law On Procurement for State or Local Government Needs a decision regarding the acquisition of separate apartment properties for the needs of a local government has been taken by the Cabinet, the Minister shall issue an order regarding the granting of earmarked subsidies for the acquisition of separate apartment properties (Sub-paragraph 3.6) within a time period of five working days after the Cabinet has taken the relevant decision.

32. The Ministry shall send an order issued by the Minister regarding the granting of an earmarked subsidy to the relevant local government and the Treasury within a time period of five working days.

IX. Transfer of Earmarked Subsidies

33. In order to receive a granted earmarked subsidy (a part thereof) for the implementation of the measures specified in Sub-paragraphs 3.1, 3.2, 3.3, 3.4 and 3.5 of these Regulations, a local government shall submit a report to the commission regarding the process of implementation of the building design (hereinafter - report), as well as documents justifying expenses once a quarter (until the tenth date of the first month of the relevant quarter).

34. In order to receive an earmarked subsidy for the implementation of the measures specified in Sub-paragraph 3.6 of these Regulations, a local government shall submit to the commission a document certifying the property rights of the local government for the acquisition of the relevant property.

35. The Agency shall examine the reports and documents justifying expenses submitted by a local government , but a building supervisor shall perform supervision of the execution of construction work and the quality of construction products and shall inform the Ministry about such supervision in writing once a quarter.

36. An earmarked subsidy, pursuant to the payment order submitted by the Ministry in accordance with the documents justifying the expenses submitted by a local government, shall be transferred in the following order:

36.1. in parts once a quarter (up to the twenty-fifth date of the first month of the relevant quarter) for the construction work executed in the report quarter for the implementation of the measures referred to in Sub-paragraphs 3.1, 3.2, 3.3, 3.4 and 3.5 of these Regulations; and

36.2. the entire sum within a time period of two weeks after the submission of the document referred to in Paragraph 34 of these Regulations if the earmarked subsidy has been granted for the measure referred to in Sub-paragraph 3.6 of these Regulations.

X. Closing Provisions

37. If a local government commits construction violations during the implementation of a project or does not provide the Ministry with information in due time or the project to which an earmarked subsidy has been granted has not been finished, but the local government has applied for an earmarked subsidy for the implementation of other projects, the commission is entitled to refuse the granting of the earmarked subsidy until the putting into service of the initiated object or to suspend the disbursement of a part thereof until the elimination of the relevant violation or the submission of information.

38. [21 March 2006]

39. Within the meaning of these Regulations, the territories of the planning region that have been specified in accordance with the Regional Development Law shall be included in a region.

Prime Minister A. Kalvītis

Minister for Regional Development
and Local Government Matters M. Kučinskis

Annex
Cabinet Regulation No. 237
5 April 2005

Additional Resources Required for the Assistance of Local Governments in Solving Apartment Matters

Minister for Regional Development
and Local Government Matters M. Kučinskis

Translation © 2007 Tulkošanas un terminoloģijas centrs (Translation and Terminology Centre)