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Inspectorate Halts Kumanovo Municipality's 1.6 Million Euro Borrowing

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Inspectorate Halts Kumanovo Municipality's 1.6 Million Euro Borrowing

The municipality of Kumanovo wanted to borrow 1.6 million euros from commercial banks. The State Inspectorate for Local Self-Government found the procedure was not in line with the law and announced a ruling to suspend the regulation's application.

The Kumanovo Municipal Council passed the long-term borrowing decision on 1 July, with the majority voting through a sum of 100 million denars earmarked for buying refuse trucks and installing photovoltaic systems. On 27 July the Inspectorate received a request to examine the legality of the procedure, and on 4 August a report from an extraordinary inspection was drawn up.

The finding is that the decision does not comply with Article 20 of the Law on Financing Local Self-Government Units - specifically, that no public hearing was held in the municipality on the project and the terms of its financing before the decision was adopted.

Two versions of the same procedure

Tomica Ilic, coordinator of the opposition councillors' group, said the Inspectorate would issue a ruling suspending the application of the regulation and that the case would proceed further.

Mayor Maksim Dimitrievski, for his part, maintains the borrowing procedure is entirely lawful, calling the claims malicious, inaccurate and manipulative. His argument is that borrowing is a multi-stage process: the Council's decision is only a precondition, and the public hearing - in his reading - should take place once the loan terms are known, not before. The municipality has announced a detailed objection to the state inspector's finding.

Both sides are clear. One says the hearing comes before the decision, the other says it comes after. The problem is that a law, if it is worth anything, should have only one meaning - and that is precisely why the Inspectorate exists, and it has now said its piece.

What interests a resident of Kumanovo least is who is right in the party argument. What interests them is whether there will be refuse trucks and whether they will be paid off over fourteen years. That is the sum - 1.6 million euros taken from a bank and repaid out of the local budget, meaning out of their pocket. The public hearing that was missing is not a formality: it is the only place where they could have asked what exactly is being bought and at what price.