State support of CZK 1.1 billion led to the regeneration of 122 brownfields out of a total of 979 that are exclusively publicly owned between 2019 and 2023. Thanks to these subsidies, neglected and unused properties covering an area of 27.4 hectares have become, for example, a municipal office, a day care centre for the elderly, a fire station, a kindergarten, a community centre, a multifunctional facility, a park or an active and passive recreation zone. Nevertheless, the SAO audit found a number of shortcomings both on the part of the providers of the subsidy, which were the Ministry for Regional Development (MMR) and the State Fund for Investment Promotion (SFPI), and on the part of the beneficiaries. In seven out of nineteen audited projects, i.e. in more than one third of them, the auditors found deficiencies indicating a breach of budgetary discipline, up to CZK 32.5 million. CZK 32 million. These were mostly errors in public procurement and ineligible expenditure.
Nevertheless, the SAO assessed the audited projects and their expenditures as efficient, except for one. In this case, the beneficiary received a subsidy of almost CZK 23 million. However, the planned gymnasium with a climbing wall, fitness, sanitary facilities, cafeteria, etc. was not built.
In the case of the Ministry of Regional Development and the SFPI, the SAO found significant deficiencies in the audit activities. For example, the Ministry often did not check the final evaluation or the financial settlement of the subsidies paid in the final phase of the project. SFPI did not carry out on-the-spot checks at the subsidy recipient's premises to the extent required by law.
Since the Ministry of Regional Development did not clearly define the conditions under which expenditures made on the area outside the registered brownfield can be eligible, some beneficiaries misinterpreted the procedure. Expenditure for construction works on plots of land outside the brownfield area was also claimed as eligible for reimbursement. In contrast, the SFPI has clearly established that costs that are an integral part of the revitalisation but were incurred outside the revitalised area are ineligible for reimbursement.
The SAO's audit showed that the Ministry of Regional Development also granted a subsidy to a beneficiary who had provided false information in the application that the object/area was not located in a flood area of 100 metres of water, although it was located in such an area. The Ministry also paid for construction work that had not been carried out at the time of invoicing, as the beneficiary had replaced the originally planned paving with granite blocks during the construction process without informing the Ministry.
The SAO also considers it a shortcoming that the only parameter monitored by the Ministry of Regional Development and the SFPI is the number of concluded contracts and not, for example, the size of the revitalised area. The SAO also found that revitalised land and reconstructed buildings in the public ownership of municipalities, towns and regions remain in the "National Database of Brownfields", even though they no longer meet the definition of a brownfield. The SAO therefore recommends that the Ministry of Regional Development ensure an inter-ministerial exchange of information that would lead to an update of the data in the National Brownfields Database.
An overview of the revitalised brownfields from the control sample can be found here: https://www.nku.cz/scripts/detail.php?id=13965.
A brownfield is a property (land, site, building) that is underused, neglected and may be contaminated. Brownfields arise as remnants of industrial, agricultural, residential, military or other activity and cannot be used appropriately and effectively without a process of regeneration or revitalisation. A total of 4346 such properties (land, premises, buildings) in the Czech Republic are registered in the "National Database of Brownfields" in private, public and combined ownership.
SAO/ gnews.cz - RoZ
ILLUSTRATIVE PHOTO - pixabay
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