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ORDER OF THE GOVERNMENT OF THE KYRGYZ REPUBLIC

of April 21, 2015 No. 230

About approval of the Regulations on selection and financing of projects at the expense of the stimulating (equity) grants and the Instruction for preparation and projects implementation

(as amended on 03-03-2017)

For the purpose of enhancement of funding mechanism at the expense of the stimulating (equity) grants in the Kyrgyz Republic, according to Articles 28 and 33 of the Budget code of the Kyrgyz Republic the Government of the Kyrgyz Republic decides:

1. Approve:

- Regulations on selection and financing of projects at the expense of the stimulating (equity) grants according to appendix 1;

- The instruction for preparation and projects implementation according to appendix 2.

2. To the Ministry of Finance of the Kyrgyz Republic to carry out work with local public administrations, executive bodies of local self-government on implementation of the mechanism of preparation, selection, approval, financing and projects implementation at the expense of the stimulating (equity) grants.

3. Declare invalid the order of the Government of the Kyrgyz Republic "About approval of the Regulations on procedure for financing at the expense of the stimulating (equity) grants" of June 29, 2012 No. 462 since January 1, 2016.

4. This resolution becomes effective:

- regarding preparation and selection of projects at the expense of the stimulating (equity) grants - since May 1, 2015;

- regarding approval, financing and projects implementation at the expense of the stimulating (equity) grants - since January 1, 2016.

5. Publish this resolution in official mass media.

6. To impose control of execution of this resolution on department of finance and credit policy of Government office of the Kyrgyz Republic.

Prime Minister

J. Otorbayev

Appendix 1

Approved by the Order of the Government of the Kyrgyz Republic of April 21, 2015 No. 230

Regulations on selection and financing of projects at the expense of the stimulating (equity) grants

1. General provisions and main determinations

1. This Provision establishes procedure for selection and financing of infrastructure projects at the expense of the stimulating (equity) grants.

2. In this Provision the following main determinations are used:

the acceptance act of object in operation - the right certifying document confirming commissioning of the facility;

the grantor - the territorial authority of authorized state body on management of public finances signing the Agreement with executive body of local self-government which draft underwent selection and approval on receipt of the stimulating (equity) grant;

the grantee - executive body of local self-government which project underwent selection and approval on receipt of the stimulating (equity) grant;

The stimulating (equity) grants - the money provided from the republican budget to executive bodies of local self-government on project and competitive basis with equity of local budgets and other raised funds for program implementation of social and economic development of the territories;

profitable security of local budgets - the planned amount of the income counting on one inhabitant who can be received by the local budget for the corresponding year;

the applicant - the executive body of local self-government which submitted the project on receipt of the stimulating (equity) grant;

the infrastructure project - the list of the tasks, actions and actions directed to creation or improvement of infrastructure facility with reasons for social and economic feasibility, amounts and terms of implementation of the capital expenditures initiated by local government bodies with participation of representatives of local community;

capital expenditures - construction costs, reconstruction, improvement, capital repairs of fixed assets;

monitoring - regular observation and data collection by the current results of activities of the project, finance and material costs during the entire period of implementation of the project;

assessment - analysis result of data of monitoring (or the data obtained at the time of evaluating) which determines current status of the project, fixes achievement intermediate or final results, makes recommendations to change of activities for the project for the purpose of its improvement;

joint monitoring and assessment (SMIO) - process of monitoring in which the interested associates on different project implementation phases for observation of the project progress and assessment of achievement of results are involved;

the agreement on receipt of the stimulating (equity) grant - the document on conditions of provision of grant signed by executive body of local self-government and territorial authority of authorized state body on management of public finances.

3. The general size of the stimulating (equity) grants annually is provided by the Law of the Kyrgyz Republic on the republican budget of the Kyrgyz Republic for the corresponding year.

4. The stimulating (equity) grants are provided to local government bodies on competitive basis. Local government bodies have the right to submit applications for receipt of the stimulating (equity) grants in accordance with the terms, provided by this Provision and the Instruction for preparation and projects implementation.

5. The stimulating (equity) grants go to capital expenditures of infrastructure projects (further - projects) fixed assets of municipal property which shall be complete and accepted in operation (within this project) within the corresponding financial year.

6. The stimulating (equity) grants are provided in the form of joint financing for projects implementation, in addition to mobilized resources of local budgets, and also other sources which are not contradicting the legislation of the Kyrgyz Republic.

7. The expected sizes (amounts of quotas) of the stimulating (equity) grants by areas, the cities of republican and regional value are determined by authorized state body by management of public finances on the formula given in appendix 1 to this Provision.

8. The maximum amount of the stimulating (equity) grant allocated from the republican budget for one project shall not exceed one million 3,0 (three million) of som.

9. Tender on receipt of the stimulating (equity) grants is carried out in two steps. At the first stage registration of the submitted documents is performed; at the second stage - assessment, selection and approval of projects for joint financing.

2. The commissions on consideration of projects on joint financing at the expense of the stimulating (equity) grants

10. For consideration of projects on joint financing at the expense of the stimulating (equity) grants the following commissions are created:

a) the commission on selection of projects at the level of the area;

b) the commission on selection of projects at the level of the cities of regional value;

c) the commission on selection of projects at the level of the cities of republican value - Bishkek and Osh;

d) commission on approval of projects.

§2.1. Commission on selection of projects

11. The commission on selection of projects at the district level is created by local public administrations; in the cities of regional and republican value it is created by the corresponding local keneshes. The number of the commissions constitutes 9 people where enter:

- representatives of local public administration or local kenesh;

- the representative of territorial authority of authorized state body on management of public finances;

- representative of the plenipotentiary of the Government of the Kyrgyz Republic in area;

- the paragraph the fifth Item 11 ceased to be valid according to the Order of the Government of the Kyrgyz Republic of 03.03.2017 No. 138

- the representatives of non-governmental, public organizations recommended by local state administration / the local kenesh. At the same time representatives of non-governmental, public organizations constitute at least 50% of total number of members of the commission on selection of projects.

12. Commission session on selection of projects is considered taken place if is present at it at least 2/3 from number of members of the commission.

13. Functions of the secretariat of the commission on selection of projects are performed by the relevant territorial authority of authorized state body on management of public finances.

14. Members of the commission on selection of projects are informed on terms of holding meetings not later than 5 calendar days before date of meeting.

§2.2. Commission on approval of projects

15. The commission on approval of projects is created by authorized state body on management of public finances. The number of the commissions on approval of projects constitutes at least 9 people where enter:

- representatives of authorized state body on management of public finances;

- the representative of Public council of authorized state body on management of public finances - as the observer;

- representatives of non-governmental, public organizations. At the same time representatives of non-governmental, public organizations constitute at least 50% of total number of members of the commission according to projects.

16. Commission chairman according to projects is the head of authorized state body on management of public finances.

17. Commission session according to projects is considered taken place if is present at it at least 2/3 from total number of members of the commission.

18. Members of the commission according to projects are informed on terms of holding meetings not later than 5 calendar days before date of meeting.

3. Conditions of preparation and submission of projects

19. The list of the projects directed to tender for the corresponding year, their priority are determined and affirm the decision of the local kenesh. The compulsory provision is availability of the submitted projects in the Program of social and economic development of the city or the ayylny aimag. The local government body directs to tender no more than 3 priority projects for the corresponding year.

20. The documents on the project submitted on tender on receipt of the stimulating (equity) grants are created and filled in according to the Instruction for preparation and projects implementation.

21. The applicant provides joint financing of the project with means of the local budget and the raised funds in the following size: with the level of profitable security of 500 percent and above - money deposit in the amount of at least 30 percent; from 200 to 500 percent - money deposit in the amount of at least 25 percent; from 100 to 200 percent - money deposit in the amount of at least 20 percent; from 50 to 100 percent - money deposit in the amount of at least 15 percent; with the level of profitable security less than 50 percent - money deposit in the amount of at least 7 percent.

22. Level of profitable security is determined by authorized state body by management of public finances on the formula given in appendix 2 to this Provision.

4. Registration of projects

23. Registration of projects of local government bodies of the cities of district value and ayylny aimags is performed by district territorial authorities of authorized state body on management of public finances. Registration of projects of local government bodies of the cities of republican and regional value is performed by city territorial authorities of authorized state body on management of public finances.

24. Registration of projects for carrying out selection on joint financing at the expense of the stimulating (equity) grants for the planned year is performed during August 1 - on December 31 the current year.

25. Registration number is assigned to the projects provided on tender. The list of the submitted documents is specified in leaf of registration which one copy signed by the parties remains in territorial authority of authorized state body on management of public finances, another is given to the applicant.

5. Procedure for consideration of the projects provided on tender on selection

26. The projects provided on tender on selection shall conform to requirements of this provision and the Instruction for preparation and projects implementation.

27. According to the list of the projects which are not conforming to requirements of this provision and the Instruction for preparation and projects implementation, the territorial authority of authorized state body on management of public finances informs applicants within 10 calendar days after completion of term of registration of projects.

28. The applicant has the right within 20 calendar days from the date of completion of registration of projects to resolve the revealed comments and to introduce documents on the project with the cover letter in territorial authority of authorized state body.

29. The list of the projects corresponding and non-compliant to the requirements of this provision and the Instruction for preparation and projects implementation, within 25 calendar days after completion of term of registration of projects is submitted to the commission on selection of projects and authorized state body on management of public finances on the form given in appendix 3 to this Provision.

30. Project information, provided on tender on selection, is published in local mass media.

31. Responsibility for timeliness, completeness and reliability of the commission on selection of projects submitted for consideration and to authorized state body on management of public finances of information on the registered projects bears management of territorial authority of authorized state body on management of public finances.

32. The project represented by local government body on tender on selection of projects is not considered and rejected in the following cases:

- availability of the project in progress financed by the stimulating (equity) grant;

- availability of pending obligations under earlier signed agreements;

- availability of instructions from the controlling, law enforcement agencies concerning the projects financed at the expense of the stimulating (equity) grants about overestimate of cost of the performed works and inappropriate use of money;

- availability of judgments concerning the projects financed at the expense of the stimulating (equity) grants on overestimate of cost of the performed works and to violation of financial discipline.

6. Procedure for selection of projects

33. Selection of projects is made based on assessment which is put down by each member of the commission on selection of projects in the form of points, according to the criteria established in appendix 4 to this Provision.

34. General calculation of points on the project is made on the basis of the estimative sheets completed with members of the commission on selection of projects.

35. On the amount of the points gained by projects the rating of estimates is created.

36. The list of the selected projects is created of the projects which gained the greatest points of rating of estimates, within the expected size (amount of quotas) of the stimulating (equity) grants of the respective area and the cities of regional and republican value, with inclusion in addition no more than 3 projects which took the subsequent places in the rating of estimates.

37. If by results of assessment projects got the equal number of points, the commission on selection of projects in addition hears project information of applicants and makes joint decision by vote.

38. The decision of the commission on selection of projects is drawn up protokolno.

39. The protocol of the decision of the commission on selection of projects and the selected projects are sent for consideration of authorized state body on management of public finances.

40. The authorized state body on management of public finances checks observance by the commissions on selection of drafts of procedures of decision making to requirements of this provision and the Instruction for preparation and projects implementation.

7. Approval procedure of projects and provision of the stimulating (equity) grant

41. The decision on approval of the list of the projects which are subject to financing at the expense of the stimulating (equity) grants is accepted by the commission on approval of projects.

42. The list of the projects which are subject to consideration by the commission on approval of projects is submitted authorized state body on management of public finances on the basis of decisions of the commissions on selection of projects.

43. The commission on approval of projects has no right to make changes to the list of the projects approved by decisions of the commissions on selection of projects at the level of areas, the cities of republican and regional value, conforming to requirements of this provision and the Instruction for preparation and projects implementation.

44. In case of identification of violation of requirements of this provision and the Instruction for preparation and projects implementation the authorized state body by management of public finances sends inquiry to the relevant territorial authority of authorized state body by management of public finances and the commission on selection of projects for need of reduction of documentation in proper type within 10 days.

45. In case of non-execution of requirements of Item 44 this provision the amount of quota and undeveloped means of the stimulating (equity) grants for the respective areas and the cities are not provided.

46. The amount of quota and undeveloped means of the stimulating (equity) grants which are formed in cases stipulated in Item the 45th this provision, are distributed on projects of other districts of the respective area having the greatest point of rating of estimates. Undeveloped means of the stimulating (equity) grants which are formed after distribution in the respective area are distributed on the projects of local government bodies having the greatest point of rating of estimates on the republic.

47. The decision of the commission on approval of projects is made by a simple majority vote from among the present members of the commission. In case of equality of votes the opinion of the commission chairman is decisive.

48. The decision of the commission on approval of projects goes to territorial authorities of authorized state body on management to public finances for agreement signature to receipt of the stimulating (equity) grant of the grantor with the grantee in the form given in appendix 5 to this Provision.

49. Information on the decision of the commission on approval of projects goes to applicants and is published on the official site of authorized state body on management to public finances.

8. Procedure for financing of projects

50. Financing of the agreement at the expense of the stimulating (equity) grants is performed on tranches after completion of payments from the local budget and other raised funds. The first tranche is financed by advance payment in the amount of 30% of the total amount of the project by own money deposits of the local budget and the raised funds and joint financing of means at the expense of the stimulating (equity) grants.

51. The subsequent payments are financed based on the submitted report on the actual performance of works, the making at least 20% of project cost under the agreement less advance payments.

52. The last tranche in the amount of 5% of project cost under the contract for construction works is financed after submission of the report on project completion.

53. Financing of the project is performed according to the conditions specified in the Instruction for preparation and projects implementation.

54. Financing of the project stops or stops in case of non-compliance with terms of agreement by local government bodies between the grantor and the grantee, identifications of violations by law enforcement or monitoring bodies on the financed project.

9. Monitoring and project evaluation

55. The grantee is accountable on completeness, efficiency of project implementation, and also observance of requirements of this provision before the local kenesh, local community, to territorial authorities of authorized state body on management of public finances.

56. The following levels of monitoring and assessment of projects implementation are established:

a) territorial authorities of authorized state body perform monitoring of execution of requirements of this provision and the Instruction for preparation and projects implementation from the commissions on selection of projects and grantees;

b) the local kenesh performs monitoring and assessment of projects implementation by executive body of local self-government.

57. Monitoring and project evaluation are performed according to the Instruction for preparation and projects implementation.

58. Quality control of the performed works, their compliance of the design estimates and responsibility according to the legislation of the Kyrgyz Republic for target use of the received stimulating (equity) grants, timely submission of the reporting on the performed works and acceptance in operation of objects is assigned to the grantee.

10. Responsibility of local government bodies in case of projects implementation

59. Responsibility of executive bodies of local self-government in case of projects implementation:

a) implementation of procedures of purchases of works, goods and services according to the legislation of the Kyrgyz Republic;

b) execution of contractual relations with the contractor;

c) target use of the financial resources allocated for projects implementation;

d) respect for environmental, sanitary standards in case of projects implementation.

Appendix 1

to Regulations on selection and financing of projects at the expense of the stimulating (equity) grants

Calculation of amounts of quotas of the stimulating (equity) grants by areas, the cities of republican and regional value

Calculation of amounts of quotas of the stimulating (equity) grants by areas, the cities of republican and regional value is determined by the following formulas:

Sobshch = Sbaz (1 part) + Sraspred (2nd part)

Sbaz (1 part) = 0,75 * Sobshch.

Sraspred (2nd part) = 0,25 * Sobshch.

Spig (1 part) = Sbaz (1 part) / Territory + + lake.

Sg.p. = 0,025 * Sraspred (2nd part)

Sg.o. = 0,075 * Sraspred (2nd part)

Sp. = 0,90 * Sraspred (2nd part)

Sraspred.i (2nd part) = (Sp. (2nd part) / Sg.o. (2nd part) / Sg.p. (2nd part)) / (Nr/Ng.obl/Ng.Res.) * Hi * Kdo

S (r/g.obl/g.res) i. = Spigi (1 part) + Sraspred.i (2nd part),

where:

Sobshch - the total amount of the stimulating (equity) grants;

Sbaz (1 part) - the scope total amount of the stimulating (equity) grants the first part;

Sraspred (the 2nd part) - the distributed total amount of the stimulating (equity) grants the second part;

Srig (1 part) - the scope total amount of the stimulating (equity) grants distributed by the first part for areas and the cities of republican and regional value;

The territory + + the lake - the total number of areas and cities of republican and regional value;

Sg.p. (the 2nd part) - amount of the stimulating (equity) grants for the cities of republican value;

Sg.o. (the 2nd part) - amount of the stimulating (equity) grants for the cities of regional value;

Sp. (the 2nd part) - amount of the stimulating (equity) grants for the area the second part;

Sraspred.i (the 2nd part) - amount of the stimulating (equity) grants for i-go of the area/city of regional value / city of republican value the second part;

S (r/g.obl/g.res) i - the total amount of the stimulating (equity) grants for i-go of the area/city of regional value / city of republican value;

(Nr/Ng.obl/Ng.Res.) - the total number of the inhabitants living respectively in the cities of district value and ayylny aimags / cities of regional value / the cities of republican value of the Kyrgyz Republic;

Hi - the number of the inhabitants living in i-m the area (in the cities of district value and ayylny aimags) / the cities of regional value / the cities of republican value (according to the latest data of National Statistical Committee of the Kyrgyz Republic);

Who - the coefficient of profitable security of areas and cities of republican and regional value equal to the level of profitable security less than 50% - 1,4, from 50-100% - 1,2, from 100-200% - 1,0, from 200-500% - 0,5, from 500% and above - 0,1.

Appendix 2

to Regulations on selection and financing of projects at the expense of the stimulating (equity) grants

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