This mechanism allows the mayors in the country to receive loans this year from privatization proceeds, registered with the Treasury, to an amount of 800 million lei. In March, when this regulation was adopted, the limit was set at 500 million lei. These funds can be used to ensure pre-financing and / or co-financing of projects financed by non-repayable external funds, including ineligible expenditure related to projects.
The government justifies its decision by responding to the request of the Romanian Association of Municipalities, led by Robert Negoita, and by stimulating the attractiveness of European funds for financing local infrastructure projects: sewers, schools, hospitals, roads.
Loans are provided at a fixed interest rate for the entire duration, calculated according to ROBOR at 3 months, communicated by the National Bank of Romania on the last working day of the month prior to the approval of the loan, increased by a margin, depending on the term of the loans. Interest rates are reduced by 0.5 percentage points compared to the March decision.
The margin is set as follows:
- 1.5 percentage points for maturities up to and including 3 years;
- 2.0 percentage points for maturities between 3 and 5 years inclusive;
- 2.5 percentage points for maturities between 5 and 10 years inclusive;
- 3.0 percentage points for maturities between 10 and 20 years inclusive.
The repayment period is determined on the basis of the term of the loan, with the possibility of early, partial or full repayment. The reimbursement will take place in equal quarterly installments from the quarter following the grant. The interest is calculated monthly by applying the interest rate to the loan balance from the date of the loan and is paid quarterly, up to the cumulative amount. The deadline for submitting documents is November 29, 2018.
Town Houses can submit their documentation to the regional public finance directorates / County Public Finance Administrations, which are sent to the local loan authorization committee.
In addition, municipalities that their employees can not pay because they have increased their lows, but whose budget has a surplus, can use that money to cover the difference.