Changes to the administrative and territorial division, new regulations on the property of closed schools

At the beginning of the new plenary week, the Parliament has to appoint the First Deputy Speaker of the Verkhovna Rada and consider 12 draft resolutions canceling the adoption of the Law on Oligarchs. In addition, MPs will vote on the changes to the administrative and territorial division of the state and decide what to do with the property of closed schools in villages.

Changes to the administrative and territorial division

Draft bill #4664 of January 1, 2021

Status: first reading.

Who is affected: inhabitants of Ukraine, government bodies, and local governments.

Background: there is a gap in Ukrainian legislation regulating the administrative and territorial division of the state. The Constitution outlines only founding principles concerting the issue, in particular, grants the Verkhovna Rada the authority to define the administrative and territorial division of Ukraine that consists of the Autonomous Republic of Crimea, oblasts, raions, cities, city districts, rural settlements, and villages.

However, there is no law defining the procedure and requirements on how and when changes to the administrative and territorial division have to be made. There are no criteria for classifying localities as cities, rural settlements, or villages. There is no procedure to designate administrative centers of oblasts and raions. For now, these issues are still regulated by the Resolution of the Presidium of the Verkhovna Rada of the Ukrainian Soviet Socialistic Republic of 1981. The resolution is quite out of date and out of place in the Ukraine of today.

The decentralization process, the amalgamation of territorial communities and raions, and the temporary occupation by the Russian Federation of Luhansk and Donetsk — the administrative centers of their oblasts — made it a pressing matter to regulate these issues by law.

Summary of the draft bill:

1. Introduces a classification for administrative territorial units:

– a raion consists of several territorial communities with a total population of at least 150 thousand inhabitants with exception of mountainous and sparsely inhabited areas where raions can have a population less than 150 thousand;

– a city is a locality with high population density and, for the most part, dense housing, with industrial and processing enterprises, developed infrastructure, and a total population of at least 10 thousand inhabitants;

– a rural settlement is a locality that was created and grew around a local enterprise, railway junction, or hydro-technical object, has the necessary infrastructure and a total population of at least 5 thousand inhabitants;

– a village is a locality with a total population of fewer than 5 thousand persons.

2. Regulates the procedure of defining the borders of administrative territorial units.
3. Grants the Verkhovna Rada the power to determine administrative centers of raions, grants the Cabinet the power to determine administrative centers of the territorial communities (with the consent of local councils of these communities).
4. Introduces the procedure of state registration of administrative territorial units, the procedure of updating and maintaining the State register of administrative territorial units and territories of territorial communities of Ukraine.
5. Urban-type settlements that are now raion centers will be qualified as cities while all other urban-type settlements will be qualified as just rural settlements.
6. Localities that are now qualified as rural settlements will be qualified as villages.
7. Cities that now have a status of being of the republican, oblast, or raion significance will be qualified as just cities.

What is right:

• the adoption of the draft bill will mostly fill the legal void in regulations on the administrative and territorial division of the state. The draft bill proposes adequate mechanisms of determining the borders of territorial communities and raions. The Cabinet will get the necessary authority to make decisions of the issues in question;
• there is no mention of urban-type settlements in the Constitution, so the qualification of urban-type settlements as settlements will make the administrative and territorial division compliant with the Constitution;
• bill’s proposal to qualify cities of the republican, oblast, and raion significance as just cities is in line with the changes in the administrative and territorial division at the level of communities and raions. It will also help to develop and implement a unified state policy on the distribution of tax revenues and subventions among the communities.

What is wrong:

• the draft bill does not solve problems created by the occupation. In particular, it will still be impossible to change the administrative centers of Luhansk and Donetsk oblasts;
• the Constitution does not grant the Verkhovna Rada the authority to determine administrative centers of raions as proposed by the draft bill. Moreover, there is no sense in giving such power to the Parliament since the location of administrative centers of raions is important for the executive and not the legislative branch;
• without the national census and the reform of residency registration, the data on the total population of the localities and the respective qualification of them as cities, rural settlements, or villages will be inadequate;
• to recognize all raion centers as cities by default contradicts other provisions of the draft bill defining clear criteria cities have to meet. It is by no means certain that all raion centers comply with the criterion of the minimal total population. The same applies to the qualification of all urban-type settlements as rural settlements and rural settlements as villages.

Alternative solution:

To amend the draft bill before the second reading. In particular, to grant the Cabinet the power to determine administrative centers of raions and, at least temporarily, to change administrative centers of oblasts if such changes are necessary due to the temporary occupation.

To harmonize the provisions qualifying raion centers of cities with requirements for cities defined in the draft bill. To set a deadline for determining the status of urban-type settlements and rural settlements in accordance with criteria defined in the draft bill.

Property of the closed schools in villages

Draft bill #5230 of March 12, 2021

Status: second reading.

Who is affected: members of territorial communities in which schools were closed, local governments.

Summary of the draft bill: allows using property and the land of communal and state-owned closed schools. However, the bill proposes to use these assets only for providing social security, culture, sports, and healthcare services. If it is impossible to provide any of these services, local councils after public hearings can lease them. A decision to lease the assets in question can be adopted only after a year after the closure of the school. Rental revenue can be spent only on educational needs.

What is right: the bill proposes to lift some of the restrictions on how assets of the closed schools can be used. This will allow territorial communities to spend less money on maintenance and will lower the risk of assets decaying.

What is wrong:

• The majority of the closed schools are in villages where the population is rapidly decreasing and, as a result, economic activity is in decline. Therefore, local communities will hardly be able to lease such assets and get enough revenue to ensure proper maintenance of the assets;
• Prohibition to sell assets that are not used for theirs designated purpose forces territorial communities to accumulate unnecessary and unprofitable assets;
• The requirement to use revenue from leasing the assets only for educational purposes prevents communities from managing their assets and income. Local councils will be tempted to spend this additional revenue on unnecessary goods and services just to fulfill the requirements of the law.

Alternative solution: to allow local councils to sell the property of closed schools or use them as mortgage assets. To allow territorial communities to use money from selling or renting these assets at their discretion.