Which Districts and Municipalities Absorb the Most EU Funds (2015)
Yavor Aleksiev, Victor Trichkov* and Georgi Vuldzhev*
The limited own resources of the Bulgarian municipalities have transformed the successful utilization of European resources in a vital prerequisite for the implementation of a number of regional projects. The widely discussed “addiction” to European money is completely understandable in view of the modest resources of the municipalities themselves to ensure their capital expenditures.
As of January 31, 2015 Bulgarian municipalities have received nearly 4.1 billion lv. as beneficiaries of the structural and cohesion funds of the EU. This is only the value of the amounts that have already been paid. The average utilization rate per capita  for the country is 564.9 BGN/capita. This is 49% higher than last year’s 379.8 BGN/capita. In other words, the amount that municipalities have received in only one year is equivalent tohalf of the total amount paid in the period between the country's accession in the EU and January 31, 2014. This trend of faster utilization reflects both the accelerated payment at the end of the previous program period and the increasing project capacity and experience of the municipalities themselves.
Last year the IME made a similar comparison of the amount of funds utilized by the structural and cohesion funds of the EU and the population of the Bulgarian district and municipalities. The main conclusions of our analysis are confirmed by this year’s data:
- The utilization rate of the European funds by the municipalities as beneficiaries of EU structural funds is very uneven throughout the country. When compared to the population it varies from 4 829 BGN/capita in the municipality Konstinbrod to 0 BGN/capita person in Gramada.
- No territorial dividing lines can be observed in the utilization of EU funds, at least with regard to Northern and Southern Bulgaria. The same applies to the size of municipalities. There are a number of smaller municipalities who successfully implement European projects, as well as a number of large municipalities that are far less successful.
Once more Gabrovo is the champion in utilization of European funds - 1360 BGN/capita as of 31/01/2015, the second, as well as last year, ranks Burgas (BGN/capita). Followed by Lovech (BGN/capita), managing to overthrow the Sofia district, which last year was the third. The lowest utilization rate is in the districts of Sliven (349 BGN/capita), Ruse (309 BGN/capita), and Kyustendil (286 BGN/capita).
The difference between the district with the most and least utilized resources increased from 787.7 BGN as of 31 January 2014 to 1 074.6 BGN as of January 31, 2015, i.e. differences in the extent of utilization intensified during the last year.
If the data on the utilization on municipal level is to be juxtaposed against thelocal population, most funds per capita were spent by the municipality Konstinbrod – 4 829 BGN per capita (population of 17 265 people). The total amount of funds utilized by the municipality as a beneficiary under the operational programs is 83.4 million BGN as of January 31st, 2015, the municipality has contracts for about 22 million BGN. In comparison, Karlovo municipality where over 50 thousand people live, managed to utilize only 17.1 million BGN or nearly five times less for three times larger population.
- 44 municipalities have utilized more than 1,000 BGN per capita. Among them are Kostinbrod, Pirdop, Hisar, Byala, Sozopol and Krichim who have utilized more than 3,000 BGN per capita.
- 37 municipalities have utilized under 1000 BGN/capita, but above the average 565 BGN/capita for the country. Blagoevgrad municipality occupies the last position in that group with utilization rate of 568.17 lv/ person.
- 152 municipalities (58% of all in the country) have utilized between 565 and 100 BGN. This group, as always, is the biggest one. Sofia, as well as Plovdiv, Ruse and Pleven are all part of this group.
- In 30 municipalities less than 100 BGN/capita have been utilized. The number of such municipalities in 2014 was 52.
In 2015 once again there is a high number of municipalities (30 total) in which the resources utilized as of the 31st of January are under 100 BGN/capita. Last year the district centers of Plovdiv and Kyustendil were in this group, but this year round, they have utilized 123.4 BGN/capita and 161.7 BGN/capita, respectively. As of 31.01.2015 the only municipality which hasn’t utilized any resources via the EU structural programs is Gramada.
It is notable, that in a short one-year period (from 31.01.2014 to 31.01.2015) the largest amount of resources in absolute terms has been utilized in the Varna district’s municipality Byala (1600 BGN/capita), and other holiday resort municipalities like Sozopol (BGN/capita), Nesebar (BGN/capita), Pomorie (BGN/capita) and Bansko (BGN/capita) as well as MalkoTarnovo (BGN/capita).
Comparing the 30 municipalities which have utilized less than 100 BGN/capita of the population and the 30 best performing municipalities in the country, we see that there are no clear territorial tendencies in the levels of utilization of EU funds. What we can see however, is a strong concentration of municipalities with a high level of utilization of funds in the district of Plovdiv and a concentration of municipalities with a low level of utilization of EU funds in the district of Vidin. Maybe the most homogenous territorial “clusters” of municipalities from the standpoint of received resources are:
- Sofia, Pazardjik and Plovdiv – nine of the 30 municipalities with the highest level of utilization and only one of the 30 municipalities with the lowest level of utilization are located in this cluster.
- Varna and Burgas – contains six of the total 30 municipalities with the highest utilization of EU funds and only one from the 30 with the lowest level of utilization.
- Stara Zagora, Sliven, Haskovo, and Yambol – in this cluster we find one of the municipalities with the highest levels of utilization and seven of the municipalities with the lowest levels of utilization.
- Vidin, Montana, and Vratsa – here we find only one municipality with a high level of utilization and six of the municipalities with the lowest levels.
The problems with the utilization of EU funds are due to both the administrative weaknesses of some of the smaller municipalities and the low quality of the strategic development documents. The presence or lack of close relations between the local and central state administration also plays a role in determining which municipalities get more projects and which get less.
In the accompanying database (in Bulgarian) you can find the resources utilized by every single municipality in the country, for which there is available information, as of 31.01.2015. The best and worst performing municipalities in each district are highlighted. We have also included a document with the official data (in Bulgarian) of the Informational System for the Management and Monitoring of the EU Structural Funds in in Bulgaria, since their latest data (for undisclosed reasons) is no longer available on their official website www.eufunds.bg.
* Victor Trichkov and Georgi Vuldzhev are IME interns.