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. Last Updated: 07/27/2016

Putin Seeks New Powers for Municipal Officials

President Vladimir Putin met with regional governors Wednesday to finalize legislation on sweeping reforms to municipal government, the last phase of the Kremlin's effort to tighten up the so-called vertical structure of power.

The main thrust of the reform is to provide municipal authorities with better funding for basic public needs such as utilities, housing, education and health care -- particularly pressing concerns with parliamentary elections only a year away and presidential polls following on their heels in 2004.

Over the past two years, "resources have been getting concentrated at the federal level" while regional and municipal budgets have been short of cash, Putin told the State Council, an advisory body made up of the nation's 89 regional leaders, Interfax reported.

But it is municipal government that must deal with "those problems that have the most painful effect on the lives of our people and on citizens' everyday needs," Putin was quoted as saying.

The president added that the obligations of municipal authorities do not always match their financial capabilities, and he wants the new legislation, prepared by a group led by his deputy chief of staff Dmitry Kozak, to change this.

"The dependence of municipal budgets on decisions made by regional authorities has reached a breaking point," Putin said. "Before, we used to promise a great deal, make decisions and send them to the local level with orders to implement these decisions, but did not provide the necessary funding. This is absolutely wrong."

Public discontent over the standard of living and the quality of social services has been on the rise recently. One week ago, as lawmakers prepared to consider next year's budget, some 12,000 protesters gathered in downtown Moscow to demand better wages and living conditions, as thousands more demonstrated in other cities.

Under the reform plan, any responsibilities placed on municipal governments, such as the construction of housing or the payment of benefits, will have to be backed up by subventions from federal or regional authorities.

The new legislation, due to take effect in 2005, is expected to be submitted to the State Duma by early December, Interfax quoted Kozak as saying.

Tyumen Governor Sergei Sobyanin told the Kommersant newspaper that most governors were satisfied with the current version of the legislation, which required plenty of haggling, as it threatened to curtail regional leaders' control over municipal governments.

Sobyanin, who headed a group of governors working with Kozak's commission, said some regional leaders were still unhappy about parts of the plan -- for example, that it does not allow them to replace the heads of insolvent municipalities with external managers. Under the latest version of the bills, this can only be done by an arbitrazh court.

The governors may also have less say than they would like in redrawing the boundaries of municipal districts.

In pushing the reform, Putin called for less bureaucracy and greater "public access" to local government. He also insisted that all municipalities should be governed by the same fundamental principles, although there would be leeway for particular areas' "distinctive features."

While the new legislation is intended to strengthen municipal government, opponents of the bill have criticized its top-down approach. They argue that the reform plan warps the idea of local self-government -- treating it not as an inalienable civic right but as an instrument for carrying out the will of the state.

Nadezhda Kosareva, president of the Moscow-based Institute for Urban Economics, said the reform failed to rectify a number of major problems.

Under the bill, Kosareva said, the average citizen would be virtually excluded from the process of local self-government.

Moreover, municipal authorities would have no right to introduce their own taxes for their own needs and the federal government would continue to dictate all sources of income for regional and municipal authorities.

"Local problems must be resolved by local self-government," Kosareva said. "This is impossible to do from the top down because the [federal or regional] center can never collect as much of the information necessary to resolve a problem as local authorities can."

Kosareva said she was also concerned that for two or three years regional and municipal authorities would be so busy recarving their property and areas of responsibility that they would neglect their more pressing duties, which the reform was supposed to help carry out more effectively.

Kosareva praised the bill for providing municipalities with funding to implement orders from above, but said certain innovations could undercut the benefits. For example, the new legislation introduces a system of cross subsidies that takes money from wealthier municipalities and redistributes it to poorer ones, thereby reducing local governments' incentive to generate income.