Poltorak A., Melnyk O., Baryshevska I., Ihnatenko Zh.
The article proves that it is important to strengthen financial capacity of united territorial communities through completely different financial and socio-economic mechanisms in the modern conditions of communities’ decentralization and further development. The state creates all conditions for the implementation of the tasks and functions of communities. However, at the local level there is a number of unresolved issues that are not only under the power of the community budget, but can be successfully solved at the expense of other resources, including alternatives.
The purpose of the study is to assess the status and justification of promising areas of financing the development of UTC through alternative sources to improve their efficiency.
The article analyzes the current trends in financing the development of united territorial communities, reveals the benefits and opportunities for attracting alternative sources of funding. Today they are represented by: fundraising; common cost (crowd-funding platforms); donor programs and opportunities in the context of decentralization reform (grants from the European Union, grants from the United States Agency for International Development (USAID), financial assistance from international projects, etc.). It is established that international technical assistance grants are currently one of the four most important sources of funds which are intended for community development. Thus, more than a third of urban, township and rural UTCs identified them as the main source of funding for the development of their own area is 37%, 36% and 41%, respectively. An algorithm for attracting grant funds for the development of UTC and other proposals that will increase the financial capacity of UTC in the long term and the implementation of local development initiatives are proposed.
Implementation of the proposed promising projects through alternative sources of funding, which are consistent with the Community Development Strategy, will contribute to the formation of a favorable business environment and the implementation of social programs in UTC, will increase financial capacity in the long term perspective. Adherence to the algorithm suggested in the article and the development of skills to raise funds from alternative sources will be a determining factor in the success of local development initiatives of the discussed territorial communities.
Key words: alternative sources of financing, united territorial communities, grant funds, projects, financial capacity.
- Buryak, M. (2014), Administrative and financial decentralization as a factor in the development of subregional territorial communities. DSFA Bulletin. Economic sciences. 2014. № 1 URL : http://nbuv.gov.ua/UJRN/vddfae_2014_1_9.
- Vasy`l`yeva, N., Gry`nchuk, N., Derun, T. & Kujbida, V. (2017), Local budget and financial support of the united territorial community, Kyiv.
- Poltorak, A. (2019), Financial security of the state in the conditions of globalization changes: theory, methodology, practice, Mykolayiv.
- Spasiv, N. (2019), Estimation of structural imbalances of budget revenues of united territorial communities. The world of finance. Vol. 2.
- On local self-government in Ukraine: the Law of Ukraine dated from May 21, 1997, № 280/97-ВР URL: http://zakon2.rada.gov.ua/laws/show/157-19
- Decentralization: Official website. URL: https://decentralization.gov.ua/
- Public financial audit of united territorial communities: key problems and ways to solve them: analytical report (2019). Kyiv. URL: https://decentralization.gov.ua/uploads/library/file/520/12.2019_2.pdf
- Association of United Territorial Communities: Official website. URL: https://hromady.org/
- Lisova A., Mel`ny`k, O. (2019) Perspective directions of financial support for the development of united territorial communities. Efficient economy. Vol. 12. URL: http://www.economy.nayka.com.ua/pdf/12_2019/161_pdf
- Vrublevs`ky`j, O. How to attract grants for community development: tips for elders URL: https://decentralization.gov.ua/news/10564