PPP as an effective tool for local sustainability Penka ARMENKOVA Mayor District Oborishte [email protected] Sofia-District Oborishte,Bulgaria.

PPP as an effective tool for local PPP as an effective tool for local sustainabilitysustainability

Penka ARMENKOVAPenka ARMENKOVA Mayor District Oborishte Mayor District Oborishte

[email protected]@abv.bg

Sofia-District OborishteSofia-District Oborishte,,BulgariaBulgaria

Bulgaria at a GlanceBulgaria at a Glance

PopulationPopulation 7,8 million7,8 million

AreaArea 110,994 sq. km110,994 sq. kmLanguageLanguage BulgarianBulgarianAlphabetAlphabet CyrillicCyrillicPredominant ReligionPredominant ReligionEastern OrthodoxEastern OrthodoxCapital CityCapital City SofiaSofia

Bulgaria Bulgaria EssentialEssential

• EU membershipEU membership

• Structural reformStructural reform

• Political stabilityPolitical stability

• Financial and macroeconomic stabilityFinancial and macroeconomic stability

• Substantial economic growthSubstantial economic growth

Ever growing, never ageing

The City of Sofia

OVERVIEWOVERVIEW• Capital and largest city in BulgariaCapital and largest city in Bulgaria

• One of the oldest European CitiesOne of the oldest European Cities

• 1.2m inhabitants1.2m inhabitants

• Dominant position in Bulgaria’s political, economic and cultural lifeDominant position in Bulgaria’s political, economic and cultural life

FAVOURABLE LOCATION ON TRADITIONAL TRADE ROUTE

Agenda of PaperAgenda of Paper

• IntroductionIntroduction – – PPP and its models• Partners, roles and mutual interests• Sectors in which PPP is most often Sectors in which PPP is most often

implemented implemented • Typical good practices of PPP and their Typical good practices of PPP and their

models models • ResultsResults• ConclusionsConclusions

•PPP enhances urban development by mobilizing of external PPP enhances urban development by mobilizing of external funding (grants and loans) or rescheduled payment ;funding (grants and loans) or rescheduled payment ;•Private companies having service contracts with the Private companies having service contracts with the municipality invest in modernization of equipment and municipality invest in modernization of equipment and perform quality services on behalf of the municipality.perform quality services on behalf of the municipality.

PPP models realized between Sofia PPP models realized between Sofia municipality and the private sector are:municipality and the private sector are: •contracting; contracting; •establishment of joint venture or shareholding companies; establishment of joint venture or shareholding companies; •concession of municipal property or the rights to build concession of municipal property or the rights to build and/or use infrastructure; and/or use infrastructure; •sale of municipal property under different conditions; sale of municipal property under different conditions; use of municipal property against maintenance; etc.use of municipal property against maintenance; etc.

Why PPP and its models

•The private sector has potential and potential and capacity - financial, - financial, technological and managerial to offer efficient and cheaper technological and managerial to offer efficient and cheaper services, it improves and services, it improves and assists in certain activities, for which the in certain activities, for which the local authority is responsiblelocal authority is responsible, but municipal budget is lean and municipal budget is lean and State subsidies are insufficient.State subsidies are insufficient.• PPrivate sectorrivate sector’s’s interests interests - - to cooperate and gain from municipal land or business activities, to get highest and best profits from get highest and best profits from commercial activitiescommercial activities, to get better position and image., to get better position and image.

•The municipalityThe municipality – – has certain assets has certain assets (real estate and land), (real estate and land), which are offered under certain conditions to private sector to be which are offered under certain conditions to private sector to be fulfilled some self-government tasks, fulfilled some self-government tasks, can facilitate certain can facilitate certain procedures related to development.procedures related to development.•Municipal benefits - Municipal benefits - improved public services, new improved public services, new construction construction for public use, for public use, maintenancemaintenance, , external additional funding, etc. external additional funding, etc.

Partners, roles and mutual interests

Sectors in which PPP is most often Sectors in which PPP is most often implementedimplemented

We involve the private sector to help and do better than what We involve the private sector to help and do better than what the municipality can do alone in its obligations in the following the municipality can do alone in its obligations in the following sectors:sectors:

• commercial developments on municipal land, which is used to commercial developments on municipal land, which is used to be improved public services; be improved public services;

• better maintenance of public buildings and facilities;better maintenance of public buildings and facilities;• reconstruction of public buildings (cultural, recreation of sport reconstruction of public buildings (cultural, recreation of sport

facilities) facilities) • management, maintenance and renovation of natural resources, management, maintenance and renovation of natural resources,

parks, gardens and recreation areas; parks, gardens and recreation areas; • construction of infrastructure; construction of infrastructure; • a variety of improved service delivery for citizens, etc. a variety of improved service delivery for citizens, etc.

Typical good practices of PPP and their Typical good practices of PPP and their modelsmodels

• Natural resource management -“Adoption“ of parks and gardens by Natural resource management -“Adoption“ of parks and gardens by business – improvement of maintenance and renovation, supply with business – improvement of maintenance and renovation, supply with new facilities and provision of infrastructure (water effects, alleys, new facilities and provision of infrastructure (water effects, alleys, lightening) in the open green spaces. lightening) in the open green spaces.

• Concession - Sofia Water company is the first water concession Concession - Sofia Water company is the first water concession project to be financed on a limited recourse basis in Central & project to be financed on a limited recourse basis in Central & Eastern Europe and the first major municipal infrastructure Eastern Europe and the first major municipal infrastructure concession and water privatization in Bulgaria. It is successful project concession and water privatization in Bulgaria. It is successful project capable of attracting multilateral financing whilst delivering services at capable of attracting multilateral financing whilst delivering services at an affordable price.an affordable price.

• Concessions for improvement of public services – organization of Concessions for improvement of public services – organization of public transport in Sofia and waste management. Both bring higher public transport in Sofia and waste management. Both bring higher satisfaction among the citizens, getting these services.satisfaction among the citizens, getting these services.

““Adoption“ of parks and gardens by Adoption“ of parks and gardens by businessbusiness

Waste managementWaste management

Typical good practices of PPP and their Typical good practices of PPP and their modelsmodels

• Renovation of buildings (public and housing stock) – well Renovation of buildings (public and housing stock) – well estimated and used potential for PPP in the renovation and use estimated and used potential for PPP in the renovation and use of the open space for profit binging developments, which can of the open space for profit binging developments, which can provide win-win situations for owners and entrepreneurs. provide win-win situations for owners and entrepreneurs.

• New construction on municipal land under certain conditions –New construction on municipal land under certain conditions –deals for construction of new amenities and services. Parking deals for construction of new amenities and services. Parking and trade centers are built on municipal land , in result the and trade centers are built on municipal land , in result the entrepreneurs get profits, the citizens - better services.entrepreneurs get profits, the citizens - better services.

• Lightening of public buildings, gardens, celebration of the new Lightening of public buildings, gardens, celebration of the new year and others - rich business companies have invested in year and others - rich business companies have invested in public lightening, thus improving the safety and the public lightening, thus improving the safety and the environment. They get opportunities to make their own environment. They get opportunities to make their own advertisement against the service.advertisement against the service.

• Partnerships with NGOs and citizens' groups - volunteers Partnerships with NGOs and citizens' groups - volunteers provide better maintenance and services for cleaning and provide better maintenance and services for cleaning and supply with equipment (waste baskets, benches and children supply with equipment (waste baskets, benches and children playgrounds) in open spaces among buildings.playgrounds) in open spaces among buildings.

Renovation of buildingsRenovation of buildings

Lightening of public Lightening of public buildingsbuildings

Lightening for new yearLightening for new year

Lightening of a gardenLightening of a garden

Children playgroundsChildren playgrounds

Parking and trade centersParking and trade centers

Partnerships with NGOs and citizens' groups - Partnerships with NGOs and citizens' groups - volunteers – maintenance, services, supply with volunteers – maintenance, services, supply with

equipmentequipment

ConclusionsConclusions The municipality has a leading role in the process of The municipality has a leading role in the process of

partnership establishment as it knows the needs and partnership establishment as it knows the needs and the problems to be solved in the urban development. It the problems to be solved in the urban development. It can identify the partners form the private sector and can identify the partners form the private sector and motivate them accordingly to assist effectively. PPP motivate them accordingly to assist effectively. PPP leads to:leads to:

• Improved local sustainability Improved local sustainability (due to innovative (due to innovative management tools - successful models of public private management tools - successful models of public private partnership)partnership)

• Improved public services, living environment and Improved public services, living environment and higher profits. higher profits.

• Trust and efficient collaboration between local Trust and efficient collaboration between local authority and private sectorauthority and private sector

Thank you!Thank you!