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INTER-MUNICIPALITY COOPERATION IN BULGARIA – BETWEEN THE

NECESSITY AND THE INFLUENCE OF EU POLICIES.


Elena Kalfova, PhD
Chief Assistant Professor, Sofia University „St. Kliment Ohridski“, Public
Administration Department, Sofia, Bulgaria

Abstract
This paper examines the development of the inter-municipality cooperation for providing public services in
Bulgaria in view of as a form of rationalization of the local governance. The purpose of this analysis is to
investigate the reasons for the inter-municipality cooperation for provision of public services, or rather the limited
practice in Bulgaria. It aims to outline to what extent the inter-municipality cooperation as a means of rationalizing
the public governance at the local level gets adopted in other spheres apart from the legally mandatory ones.
The Bulgarian practice shows that even through on a purely rational level the benefits of the inter-municipality
cooperation might be evident this does not always lead to fast and easy introduction into the practice. In Bulgaria
the inter-municipality cooperation and for the provision of services in particular is not part of the governance and
administrative tradition. After the long period of centralized governance during the socialism the municipalities
find it hard to accept any form of centralization whatsoever, even if partial and actually the only option for
overcoming the extreme falling behind in the development of a specific sector and the provision of a relatively
good quality public service. Nevertheless, in the past years it is gradually penetrating the practice, but generally as
a result of the necessity to align the models of providing public services with the EU requirements related to the
utilization of the Structural Funds and/or with certain requirements of the Community policies. This hypothesis
was put to empirical verification in research. An analysis was made to what extent the introduction of mandatory
cooperation between the municipalities has led to the adoption of this governance practice in other spheres where
it is not normatively mandatory. This analytical approach derives from the assumption that as a result of the
established practice a process of “learning” is developing and the established governance and administrative
practice is considered in spheres different from the one where it is normatively required. Otherwise put, we are
looking for an answer to the question whether the introduced approach that is alien” to the domestic governance
and administrative tradition has succeeded in changing, however slightly, the governance and administrative
practice in Bulgaria and activate the cooperation among the municipalities in particular.
Although no legal restrictions exist to the inter-municipality cooperation, it is not widely accepted in Bulgaria. We
can assert that it is not accepted in the public service provision except in the cases where it is a legal obligation. A
major example in this aspect is the inter-municipality cooperation in the waste management and W&S sectors.
These forms of cooperation have no or nearly no analogue in the Bulgarian practice. They fall entirely outside the
political and administrative tradition. The presence of even a small degree of centralization immediately arouses
the resistance of the municipalities. In addition, the arguments of the social cost of the reform and the restricted
opportunities for mutual financing between the municipal enterprises have led to an extremely difficult
introduction of the practice in Bulgaria. Despite, or precisely because of it we can be moderately optimistic.
Regardless of the tradition, the social cost and the short-term financial interest the inter-municipality cooperation
is still a fact and has reached a scope, however modest, outside the legally binding practices.
Kay words: inter-municipality cooperation, local government reform

1. Introduction
The search for effectiveness and efficiency in the governance and provision of public services at the local level is
one of the topical problems of the European municipalities. In Europe, as in Bulgaria there are ongoing processes
of decentralization and deregulation. The central government on the national level is transferring responsibilities
and sovereignty to supranational institutions and to the subnational levels of governance. The public-private
networks of various types are increasing in number on every level of governance. This is the result of the changing
scope of economic and/or political activities that is enlarging and/or relocating compared with the traditional
governance scope of the institutions on all the levels of governance. These processes confront the local authorities
with a constantly changing social, economic, political and institutional environment, producing a series of
challenges regardless of their „scale, scope, autonomy and position in the national administrative system“(Hulst,
R., and А. Van Montfort, 2007, p. 3).
The greater local autonomy inevitably goes hand in hand with the increasing number of tasks that the local
authorities need to solve and whose achievement influences, directly or indirectly, their legitimacy (Scharpf 1999,
Kuhlmann 2008). The growing importance of the regional and local levels in the policy-making, together with the
increasing technological complexity of the local and regional interventions require increased financial resource.
The municipalities find it ever harder to meet the requirements for quality of the public services, for introduction
of high-technology standards in the public services (for instance in the water supply and sewerage, waste
management, urban transport organization etc.). Furthermore, they often have limited taxation responsibilities.
This impedes the local authorities and the small municipalities in particular, which suffer from permanent deficit
of financial resources and confines considerably their abilities for effective provision of public services and their
involvement in the development of public policies (Citroni, G., A., Lippi and S., Profeti, 2012, pp. 209-210).
Parallel with that the process of depopulation of the small settlements and concentration of the population in the
big cities is typical of all Europe. The shrinking of the population does not allow the small municipalities to secure
sufficient resource for the fulfilment of their responsibilities even when they enjoy greater taxation responsibilities.
The economic integration in the EU, the common market and the common currency have created a much more
competitive environment and substantially increased the financial pressure on the local authorities.
The regionalization processes and the adoption of the multilevel governance as a more or less permanent trend in
the governance of the EU states in the past 50 years are equally raising new requirements to the local authorities.
The local authorities have to manage public spheres whose scope essentially exceeds the local problems and should
provide public services in those spheres in an effective and efficient manner. In addition, the European institutions
perceive the principles of partnership, solidarity and subsidiarity as crucial in the implementation of the
Community policies (Hooghe, L. and G. Marks, 2003, pp. 235-236). They necessitate the active inclusion of the
local and regional authorities in the realization of the common European policies. This way of implementing the
Community policies demands by the local authorities to develop capacity for participation them, without which
the actual implementation of the majority of the European policies and practices would be impossible.
There are four main possible strategies for handling the existing situation – uniting of the municipalities,
redistribution of responsibilities between the levels of governance, inclusion of private organizations in the
provision of public services and inter-municipality cooperation. These strategic approaches are not mutually
exclusive, but rather complementary. The most often applied in parallel (Hulst, R., and А. Van Montfort, 2007, p.
4-8).
This paper examines the development of the inter-municipality cooperation in Bulgaria in view of providing public
services as a form of rationalization and horizontal integration of the local governance. The purpose of this analysis
is to investigate the reasons for the inter-municipality cooperation for provision of public services, or rather the
limited practice in Bulgaria. It aims at evaluating the transfer of EU policies in Bulgaria and to what extent this is
a factor and whether it is the only factor for the cooperation of the Bulgarian municipalities. It aims to outline to
what extent the inter-municipality cooperation as a means of rationalizing the public governance at the local level
gets adopted in other spheres apart from the legally mandatory ones.

2. Methodology
2.1. Analytical framework and the concept of inter-municipality cooperation
The inter-municipality cooperation analysis is made in the framework of the sociological institutionalism concept.
The core of this concept is the idea that the institutions, i.e. systems of rules, norms, values and practices structure
the actions of the participants (Hulst, R., and А. Van Montfort, 2007, p. 12). The concept of flexible policy
networks is increasingly recognized and applied compared with the classical concept of the theory-based hierarchy
governance structure (Hooghe and Marks, 2003; Pierre, 2000; Rhodes, 1996). In this frame the public-private
partnerships, the inter-municipality cooperation get more and more involved and function outside the traditional
governance frame. The perception of those concepts leads to the explanation of the inter-municipality cooperation
as a model of institutional collective action, representing the local authorities’ cooperation solution more as a
rational choice (Rayle, L. and C. Zegras, 2013, p. 873).
Such an analytical approach necessitates the outlining of the main features of the institutional system of the nation
state, the administrative system and the local authorities’ position in it. This includes the issues of state structure
– federal and unitary; the levels of governance; the distribution of responsibilities among them; the level of
autonomy of the local governance and the number and size of the municipalities. Equally important are the norms,
values and informal rules and traditions that have a substantial influence on the inter-institutional relations and
interactions (Hulst, R., and А. Van Montfort, 2007, p. 12). It is necessary, of course, to also examine the European
context and the ways, in which the EU system of governance and policy-making influences the local authorities.
Secondly, a review should be made of the normative arrangements regulating the cooperation among the
municipalities. The normative arrangements may facilitate or impede the inter-municipality cooperation. The
attitude of the national level of governance, and eventually the regional to the inter-municipality cooperation is a
key factor for its development. It is possible that the national level creates incentives for cooperation between the
municipalities or that it restricts it (Hulst, R., and А. Van Montfort, 2007, p. 13).
The institutional framework analysis is followed by an analysis of the inter-municipality cooperation’s
organizational design. It includes the level of organizational integration, the manner of establishing the cooperation
(voluntary or mandatory), the organization of the political representation and accounts of the influence on the
democratic character of the local governance. The trends in the practice of the public administration and the
development and perception of certain scientific statements in the society also influence the process of introducing
the inter-municipality cooperation. Therefore a broader circle of social, economic and demographic features, as
well as the cultural and technological development can also be considered by the analysis (Hulst, R., and А. Van
Montfort, 2007, p. 15-16).
The inter-municipality cooperation is an interaction of the local authorities with one or many purposes. It has the
following main characteristics: a form of institutionalized or contractual interaction between municipalities (that
may also include other public or private institutions or organizations) with a common goal(s) that does not lead to
the establishment of a new independent institution or organization (Hulst, R., and А. Van Montfort, 2007, p. 10).
The inter-municipality cooperation is the main form of horizontal integration of the local and regional-level
governance. When entering into this cooperation, the local authorities provide the necessary resources for the
achievement of the objectives and benefit from the results in a solidary way. The inter-municipality cooperation
may ensure the fulfilment of the responsibilities of municipalities in all spheres, equip the local authorities with
the necessary capacity for service provision, assist in reducing the differences in the provision of services between
neighbouring municipalities, lead to a transfer of innovations and contribute to the sustainable development of the
communities (Jackson, ed., 2010, p.5-9). The inter-municipality cooperation also improves the coordination in the
regional-level governance. In the USA it is much more voluntary than the European practice, which are more
formalized (Agranoff and McGuire 2003, p.10-13). It is generally perceived as the politically more acceptable
alternative compared with the merging of municipalities. This is exactly the reason why it often attracts the interest
when local government reforms are implemented. The introduction of the inter-municipality cooperation in the
public service provision is an essential reform in the local and regional governance sphere. The relevant results
exceed by far the goal of increasing the governance effectiveness and efficiency. It also involves the processes of
changing the institutional structure and administrative and territorial organization of the states (Germà, B. and M.,
E. Warner, 2015, p. 2-3).
2.2. Cooperation between the municipalities – factors, types, risks.
The existence of an institutional system and traditions in the inter-institutional relations and interactions are the
main factors of accepting the inter-municipality cooperation or not. The existing legal framework may encourage
the cooperation between the municipalities or restrict it. Usually institutional systems providing greater authorities
also provide more cooperation opportunities. States characterized by strong centralized governance more rarely
create a supportive environment for the inter-municipality cooperation. The support or resistance of the superior
levels of governance is a key to the success or failure of the inter-municipality cooperation (Hulst, R., and А. Van
Montfort, 2007, p.15)
Municipalities that have the practice of according their activities and performing various informal and contractual
partnerships, or of creating the organization necessary to influence the higher levels of governance would be more
inclined to establish inter-municipality cooperation. In other words, the existing networks could facilitate the
building of the inter-municipality cooperation.
The deficit of own resources for ensuring the implementation of the responsibilities of the municipalities is the
main reason for the inter-municipality cooperation. Taken the municipalities’ small territory and population, the
probability of a municipality to have very limited own resources is high, which makes the implementation of the
local authorities’ responsibilities difficult. This process of fragmentation is balanced by the creation of various
forms of inter-municipality cooperation (Germà B., X. Fageda and M. Mur, 2013, p.440).
The fiscal factors are often the key to the introduction of inter-municipality cooperation. The local authorities
cooperate when they have an interest and when it will help them secure sufficient financial resource for the
provision of public services. On the other hand the local authorities with higher expenses and considerably lower
income than the rest could remain excluded from the inter-municipality cooperation. The richer municipalities
may avoid cooperation with the poorer because they are able to finance their activities and public services
independently (Germà, B. and Mildred E. Warner, 2015, p. 3-4).
The economy of scale concept is the leading reason for the creation of inter-municipality cooperation. It states that
the provision of public services is much more efficient when delivered on a larger scale. The construction and
maintenance of road infrastructure, water supply and sewerage, the waste management etc. are good examples in
this domain. Such services are often provided by inter-municipality cooperation both in Europe and North America
(Germà, B. and Mildred E. Warner, 2015, 7-9). Improving the quality of the provided services and the introduction
of new ones is an important driver of development of the inter-municipality cooperation. In addition it is often
assumed that the boundaries of service provision/utilization should coincide with the administrative boundaries of
the municipalities providing them. When the administrative boundaries of the local authorities do not coincide
with the scope of utilization of the public service, it is financed by one local authority and utilized by the residents
of the neighbouring municipalities. This is a frequent phenomenon in view of the increased people mobility in the
past 50 years. These processes necessitate that the local authorities provide services of regional scope. This is very
difficult with the local level governance fragmentation due to the scarcity of resources and impeded coordination
between the municipalities (Germà, B. and Mildred E. Warner, 2015, p.5-6).
The policies and administrative and governance practices of the EU are a serious factor that stimulates the inter-
municipality partnerships. For instance part of the EU funded programmes are implemented through projects
falling within the sphere of competence of the local; authorities, but the scope of activities and results goes beyond
a single municipality. In such cases the cooperation between the municipalities is obligatory as a form of
implementation of the policies and projects.
First of all when making a typology of the inter-municipality cooperation a difference must be made between inter-
municipality cooperation that is only local, i.e. includes only municipalities and cooperation that includes
municipalities and representatives of other public institutions, higher-level representatives and/or for example
specialized agencies. The inter-municipality cooperation can be divided into one purpose (for instance for the
purpose of providing a single public service) and multipurpose (Hulst, R., and Van Montfort, 2007, p. 11-12).
The typology of inter-municipality cooperation reflects the level of institutionalization. There are three types of
inter-municipality cooperation according to the level of institutionalization – non-institutionalized cooperation,
weakly formalized cooperation and integrated territorial cooperation (Jackson, ed., 2010, p. 12-14). Moist of the
interactions between the local authorities are outside the firm institutional framework – meetings of mayors and
senior administrative officers, technical committees and development committees. Nevertheless, this type of
cooperation supports the solution of emerging ad hoc issues and enables the development of cooperation in spheres
like tourism, increasing the administrative capacity etc. The weakly formalized cooperation is based on agreements
that have only one purpose and are usually terminated with the achievement of the purpose that they were
concluded for. The integrated territorial cooperation has responsibilities in more than one sphere of public
governance and sometimes represents the interests of the member municipalities before other participants in the
process of governance. This case also includes regional associations of the local authorities, to which the
responsibilities for the implementation of one or more tasks are transferred and the management is performed by
a collective body formed of representatives of the cooperating municipalities. They are also created to provide
jointly public services. The participating local authorities establish a new legal entity that assumes the performance
of specific functions on their behalf. Such enterprises may provide one or more public services (Jackson, ed, 2010,
p.14-16).
The typology of inter-municipality cooperation uses also the freedom of the municipalities to choose to join such
cooperation or not as a criterion. The cooperation between the municipalities may be voluntary or obligatory.
Obligatory cooperation exists when the initiative for the cooperation comes from the central government. In those
cases the functioning of the inter-municipality cooperation is regulated by special legislation and they are
responsible for the provision of the public services. Furthermore, the municipalities cannot leave the established
associations at least for a set period of time (several years) and even if they do, it can only happen with a long-
term prior notification. Also valid is the principle of territorial cohesion – the local authorities may cooperate only
in the framework of one regional or federal unit’s territory. This model of cooperation exists in France, Germany,
Austria, Spain, Norway, Portugal, Switzerland, Sweden, Slovakia, Hungary, the Czech Republic, and Luxemburg.
Voluntary cooperation includes any cases where the municipalities decide independently whether to cooperate or
no0t and for what purposes. Such associations exist in all the European states (ФРМС 2010, p. 19-38).
The cooperation between municipalities in its variety of forms and levels of institutionalization has its positive and
negative aspects. It should be considered a possible form of rationalization of the public governance and not a
panacea of all local governance issues. The inter-municipality cooperation assists the exchange of good governance
practices between the partner municipalities. It stimulates the cooperative political culture and enables the broader
inclusion of various representatives of the local community in the local governance (non-government
organizations, social partners, cultural and sports clubs etc.). It enables the local authorities to provide higher-
quality public services with higher effectiveness and efficiency. This develops the social capital of the local
community. The inter-municipality cooperation builds capacity for and encourages the public-private partnerships
and the cross-border cooperation between the local authorities. Of course, the inter-municipality cooperation has
its risks. The need to accord the decisions among several municipalities can slow down the decision-making
process. The rate of delay will depend on the form of the respective cooperation. With the non-formal cooperation
and the contractual forms the risk will be much higher than with the forms creating consortia that are legal entities
and function independently. It is possible that some municipalities, suffering from bureaucratic inertia, continue
to allocate financial, administrative and human resources to the governance of sectors and/or services, the
responsibility of which that they have transferred to a newly established inter-municipality cooperation. The inter-
municipality cooperation often allegedly suffers from democratic deficit. This is due to the fact that those who
manage the cooperation are not elected, but appointed officials. Therefore the political responsibility for the taken
decisions and the undertaken actions of the inter-municipality unit is reduced to the minimum (Hulst and Montfort,
2007, p. 9).

3. The Bulgarian Practice – a Moderate Optimism?


3.1. Institutional system of Bulgaria – the position of the local government.
Bulgaria is a parliamentary republic with local self-government (Constitution of the RB, Art.2). The local self-
government has deep historical traditions in both Bulgaria and Europe. In most European states, including the
states of Central and Eastern Europe the local government is provided for in the country’s Constitution. A specific
feature of Bulgaria is that in addition to the constitutional guarantees the right of territorial self-identification of
the citizens is also regulated. The territory of a given municipality may only be altered after a plebiscite with its
population (Constitution of the RB, Art.136, par.2). In this way every decision for merging of municipalities and/or
changing their boundaries should be put to a local referendum. This rule excludes the possibility of the central
government undertaking a strategy for aggregating the municipalities. The models of implementing administrative
territorial reforms through legislative amendments and merging of municipalities we know from other European
countries are practically inapplicable in Bulgaria. This gives the Bulgarian municipalities a very solid warrantee
of their right of self-government.
There is one level of self-government in Bulgaria. In spite of a series of expert proposals and proposals of some
political parties in Bulgaria no second level of self-governance has been built. Deconcentrated structures of the
central government function on the regional level in the form of 28 districts. The districts are governed by district
governors appointed by the Council of Ministers. It is responsible for the implementation of the state policy, the
protection of the national interests, the rule of law and public order and the administrative control (Constitution of
the RB, Art.143, par.3). This framework grants the district governors very limited authorities. In the Bulgarian
case the deconcentrated administrative structures of the ministries report to the respective minister and the district
governor has no authorities over their governance, for example (unlike the classical prefecture system in France).
As is logical for the status of a deconcentrated structure, the district governors do not have an independent budget.
The adoption of the classical form of administrative regional division in Bulgaria limits the opportunities to transfer
some of the functions of the municipalities to the district governors. Thus, yet another theoretically possible
strategy for reforms is excluded in case the local authorities are unable to provide good quality public services –
transferring of responsibilities to the higher levels of governance.
3.2. The local authorities in Bulgaria – numerous responsibilities, limited resources.
The self-government in Bulgaria is traditionally performed at the local level. The system of local government in
Bulgaria has undergone a series of reforms in the period after the collapse of the socialist regime until the end of
the 20th century. In the course of 15 years active reforms have been implemented for the building of the local
government institutional structure, definition of the authorities of the various local institutions, distribution of the
responsibilities among the different levels of government and provision of financial and human resources on the
local level. A democratic local government system has been built in Bulgaria. The municipality is a structure of
general competence, “which allows it to act on behalf and for the prosperity of the local community in its own
discretion. Any activities not prohibited by the law are allowed to it” (Stefanova, 2003, p. 41). Therefore, the
municipality is responsible for the solution of all matters of local importance. The municipalities in Bulgaria have
taxations responsibilities as well since 2007. They have the right of determining the amount of the local taxes,
complying with the upper and lower limits as set out in the law. The types of the local taxes are set out in a law by
the central government. All the municipalities in Bulgaria have the same volume of competences in the same set
of spheres regardless of their size.
The adoption of this concept of the role of municipalities has led to governance authority in nearly all the spheres
of public governance. The sphere of competence of the local self-governance include sectors that demand the
existence of considerable administrative capacity, financial and human resources like the waste management and
the water sector management. Such a broad definition of the authorities has its advantages and shortcomings. On
the one hand it allows the municipalities to implement their own public policies with a significant scope. On the
other hand the central authorities still hold a substantial share of the governance in most of the public sectors. Only
the collection and depositing of household waste, the cleaning of the streets, the nurseries, kindergartens and social
institutions, the local road system and the public transport are entirely in granted to the municipal authorities. In
the remaining spheres the competences are shared between the national and local level, with the preservation of a
rather centralized model of governance. The central government retained the control over the public service
provision system defining standards for them, over the control system and to a great extent over the human
resources recruitment system and the financing in most of the spheres of competences.
The tradition of strong centralized government has preserved in Bulgaria in many spheres, especially in the
provision of public services. The central government has retained its control over the sources of financing. The
system of municipal revenues, which is a part of the local taxes and fees, has some characteristics typical of the
strongly centralized state where the local authorities play a secondary role in the public sector and have very limited
financial independence. The proportion of own income in the municipal budgets in Bulgaria is 15% on average
versus a 40% average value for the EU. The share of the municipal taxes of all taxes is 4% versus 25% EU average.
The share of municipal taxes in the GDP is 0.9% versus an EU average of 6.6%.1 Thus determined, the limited tax
income of the municipalities is by no means accorded with the volume of responsibilities charged upon the local
authorities. The provision of public services remains centrally regulated, the regulation is excessive and limits the
authorities of the municipalities to a certain extent. At the central the type and manner of provision of a
considerable part of the public services is regulated and often insufficient funds are transferred to the
municipalities. Alternatively, the financing of the services is secured on the basis of norms of costs determined by

1
2015 data of Ministry of Finance
the central government and secured by the republican budget. These funds are not enough to ensure good quality
of the provided services. The responsibility for the service provision remains with the municipalities.
3.3. The size of the Bulgarian municipalities – the average value trap.
In Bulgaria there are 265 municipalities with an average population of nearly 28 000 residents2. This size looks
sizeable at first glance, but the differences in the size of the individual municipalities are very big. The country
suffers from a grave demographic crisis – negative population growth, aging population on the one hand and
depopulation of many areas on the other. In practice only the capital city registers a positive population growth,
while the three largest municipalities either maintain the size of their population (Plovdiv) or register minimum
growth of around 6% (Varna and Burgas). All the remaining 262 municipalities suffer from a continuous downfall
in the number of their residents.3
The Bulgarian legislation has set out a limit of 6000 persons as the minimum population necessary for the creation
of a new municipality, i.e. this is considered the minimum guarantee of a municipality’s viability. In 1995 the
municipalities with a population under 6000 residents were 23, 36 in 2000, 60 in 2011, and in 2015 they were
already 66. Those municipalities do not answer the requirements of Law on Administrative-Territorial Division
of Bulgaria (Art.8, par.1) for the presence of more than 6000 residents, i.e. more than 25% of the Bulgarian
municipalities remain with less than 6000 population. Another 60 municipalities have a population of between
6000 and 10000 residents4. The ongoing increase in the number of municipalities with less than 6000 residents is
a serious problem. Their opportunities to raise sufficient resources for the fulfillment of their authorities and
obligations is limited. No positive trends have been registered in the demographic situation in Bulgaria at this stage
and therefore it could be realistically expected that the number of small municipalities would keep growing.
To sum up, the municipalities in Bulgaria have broad authorities in numerous spheres of the public governance.
Their status is guaranteed at the highest possible level in the Constitution and through the introduced right of
territorial self-identification of the citizens in the Constitution of the RB. Despite, the level of financial
decentralization in the country is significantly below the EU average. In addition the grave processes of
depopulation and aging of the population place more than 25% of the municipalities in actual impossibility of
ensuring sufficient financial resources to be able to fulfill their responsibilities and provide public services to their
residents. At this background the inter-municipalities cooperation for provision of public services looks as the
unavoidable alternative. The practice is, however, different.

4. The Inter-municipality Cooperation for Provision of Public Services – Mission


Possible?
The right of association and cooperation of the municipalities in Bulgaria is guaranteed by the Constitution of the
Republic of Bulgaria (Art.137) and the Law for local self-government and local administration (Art.9, Art.59,
Art.60), and by the European Charter of Local Self-Government (Art.10,). Since the mid-90s of the 20th century
various associations of municipalities have been established: the National Association of the Municipalities,
professional associations of the municipal officers etc. The informal cooperation is a popular practice. A relevant
example would be the existing partnership and friendship between two Bulgarian municipalities and/or between a
Bulgarian municipality and a municipality from another country, partnership programmes and exchange of
experience, regional culture forums etc. An example of the less formalized regional cooperation will be the tourist
associations, the regional development agencies and business centres, the local action groups, various forms of
cross-border cooperation etc. The listed forms of cooperation are entirely voluntary. The Bulgarian legislation has
also envisaged forms of mandatory cooperation between the municipalities. Mandatory cooperation is introduced
by the Waste Management Act (2003) and the Waters Act (2000). Their aim is to ensure the provision of public
services in the respective spheres. Until now the mandatory or voluntary associations for service provision were
not a familiar practice in the Bulgarian administrative and governance tradition.
4.1. Inter-municipality cooperation for waste management on regional level – the new practice.
The waste management responsibilities are among the few in Bulgaria that fall under the responsibility of the local
authorities only. In 2003 there was a large number of irregular dung-hills, a huge part of the small municipalities
have no waste depositing facilities corresponding to the national and European standards.. Bulgaria made the
commitment of building 55 regional depots for rendering household waste harmless in implementation of Directive
1999/31/ЕC. The Waste Management Act (promulgated in SG issue 86, 2003) defines the rules for ecological
waste management. It defines the need for regional governance of those processes and introduces regional waste
management systems for the purpose. The regional waste management associations should be established by the
municipalities on the territory of 55 regions with a scope, determined in the National Waste Management
Programme. They are managed by regional waste management entities.

2
Author’s estimates based on data of the Bulgarian National Statistical Institute from the latest national census in
2011.
3
Data of the Bulgarian National Statistical Institute from the latest national census in 2011
4
Data of the Bulgarian National Statistical Institute.
The project financed by the Structural Funds in this field apply the requirement for creating inter-municipality
cooperation. One of the three specific strategic objectives of OP Environment is “improving the waste management
and the protection of soils“. Beneficiaries under this objective are the municipalities, since activities are financed
for waste management at the local level only if the respective municipality is a member of a regional waste
management association. In spite of the existence of this funding opportunity and the poor situation in numerous
municipalities in this sector, a large part of the local authorities in Bulgaria reject participation in such associations.
The need to fulfil the commitments made to the EU led to legislative amendments in 2010. The creation of regional
waste management associations became obligatory for all municipalities. In the National Waste Management
Programme this approach is directly justified by the European practices which have proven that “the creation of
regional inter-municipality cooperation is a successful model of waste management”. It improves the effectiveness
and transparency and enhances the civil participation in the governance. Therefore for the first time in the
Bulgarian practice a form of mandatory cooperation between the municipalities was introduced for the provision
of a specific public service. The introduction of mandatory inter-municipality cooperation for waste management
is entirely the result the Community policy in the field of the environment and the adoption of EU governance and
administrative practices.
The regional waste management association aims to ensure the effective fulfillment of the local authorities’
responsibilities for waste management, waste disposal, waste processing and waste recycling. A municipality that
rejects participation, causes delays, thwarts the creation or functioning of a regional waste management association
shall cover the damages and missed benefits of the remaining municipalities in the region. The regional waste
management associations are legal entities, governed by the principles of equality of the participants, free
association in mutual interest of the participants, transparency and responsibility in respecting the hierarchy in the
management of waste. The management bodies are a chairperson and a general assembly (Waste Management act,
promulgated in SG issue 86: 2003). The general assembly consists of the mayors of the member municipalities of
the waste management regional association and the respective district governor(s), but as non-vote. It elects a
chairperson of the waste management regional association – one of its regular members for a period equal to his/her
respective mayor’s term of office. All governance decisions are taken by the general assembly of the waste
management regional association (Waste Management act, promulgated in SG issue 86: 2003). The type of
ownership of the regional waste depot and/or other waste treatment facilities are determined by the general
assembly of the waste management regional association and can belong to: the municipality which owns the terrain
or has the right of construction on the identified terrain; co-owner of the member municipalities of the waste
management regional association; co-ownership of a private partner and the municipality that owns the terrain
and/or the member municipalities of the waste management regional association; owned by the financing private
partner for preparation of the facilities before the utilization or rendering harmless and utilization of the waste
(Waste Management act, promulgated in SG issue 86: 2003). This regulation keeps the waste management entire
within the competences of the local authorities, but carried out through obligatory inter-municipality cooperation
for provision of public services.
4.2. The other practice – water sector management – a repetition or not quite.
The management of the water sector in Bulgaria is a shared competence between the local and the national level.
Responsibilities and ownership are shared between the municipalities and central government. Currently, the WSS
sector in Bulgaria is fragmented, with complex and unclear management structure, obsolete infrastructure and low
quality work making it highly inefficient. Bulgaria collects and treats a lower share of its wastewater than most
EU member states. The Water Supply and Sanitation sector in Bulgaria is in a crucial stage of its development.
The reform tries to tackle the existing problems Bulgaria faces in terms of non-appliance of the EU directives on
water treatment for settlements above 10 000 inhabitants, old and depreciated infrastructure resulting in over 60%
non-revenue water (NRW) lost across pipes, compared with only 7% for Germany, and the low performance of
the fragmented WSSOs. There are overall 63 Water supply operators across Bulgaria in different sizes and
ownership – 14 are owned 100% by the state, 15 have mixed ownership (51% state and 49% municipal, 23 are
100% owned by the municipality, of which 1 is a concession and 11 are private operators serving private-owned
entities. Compared with 2008 (1.55 BGN) the average WSS tariff has increased over 25% and compared to 2011
(1.85) with over 5% (2016 – 1.95 BGN). The price range of WSS is also quite diverse among operators and among
the settlements they serve hinting different performance and cost-effectiveness. The water supply tariff varies
between 0.26 BGN for Breznik municipality to 2.28 BGN /m3 for Isperih municipality. The Water supply tariff is
priced below 1 BGN/m3 for 15 WSSOs that serve only certain municipalities such as Kresna, Sapareva bania,
Batak, Mikrevo, Rakitovo, Bratsigovo, Antonovo, Velingrad, Sandanski, Berkovitsa, Dupnitsa, Belovo, Strelcha
and Botevgrad.. The municipality with highest Water supply tariffs are Isperih, Dobrich, Razgrad, Kubrat and
Silistra (all in the range between 1.89 and 2.28 BGN/m3). The variation of the sewage service tariff is also striking,
going from 0.04 (Batak) to 0.31 BGN/m3 (Plovdiv). In terms of water treatment prices vary from 0.08 BGN/m3
(Veliko Tarnovo) to 0.79 BGN/m3 (for the WSSO that serves the Municipality of Knezha)5. Overall three big

5
Data from: DKER data on tariffs for 2016.
provinces in Bulgaria do not have water treatment – Yambol, Silistra and Vidin. Currently water treatment plants
are under construction and are planned to be completed in 2018 in Silistra and Vidin to serve respectively 45.9
thousand and 56 thousand inhabitants.
The Waters Act (promulgated in SG issue 67: 1999), in force since 01.01. 2000 and the Regulations for the
organization and functioning of the W&S associations imposed the creation of W&S associations. The creation of
28 autonomous territories whose scope coincides with that of the districts is envisaged. One autonomous territory
should be served by one W&S operator. A W&S association will be created for each autonomous territory. The
representative of the state in the association will be the district governor of the district as a territorial and
administrative unit where the respective autonomous territory is located. The district governor is the representative
of the central government in the W&S Association. The representative of the municipality in the W&S association
is the municipal mayor and if he or she is unable to participate, the municipal council should elect another
representative. The management bodies of the association are: a general assembly consisting of two representatives
of the state and the municipalities and a chairperson who is the state representative. All the governance decision-
making authorities are vested in the general assembly and the chairperson has implementation responsibilities. The
votes in the general assembly are distributed as follows: the state holds 35% of the votes and the municipalities
distribute the remaining 65% among them proportionate to the number of their population. The total number of
votes in the general assembly is 100 (Waters Act, promulgated in SG issue 67: 1999). The same model is applied
when determining the membership instalments in the budget of the association. The W&S Association is
responsible for the management, planning and construction of W&S systems and appliances – public state and
public municipal property and the selection and control of the W&S operator on the respective autonomous
territory. The association is not a commercial company and it does not generate or distribute profit. The W&S
associations are inter-municipality cooperation with the participation of the central government for the provision
of one public service. They do not have the right of performing other activities.
The membership of the municipalities in the W&S Associations is not unconditionally mandatory. The municipal
councils are free to decline membership in the association of a specific municipality. In this case, as well as in the
waste collection management, the central government has adopted an approach that encourages the participation
of the municipalities in inter-municipality cooperation. The main incentive (and a restriction to a certain extent) is
again the EU funding. Funding for construction and development of the W&S infrastructure in the 2014-2020
programme period will only be provided to the W&S associations. Municipalities that are not members of such
associations will not receive European funding. Overall, it is extremely important for the municipalities due to
their very limited own resources and the enormous needs for investments in the sector.
Nevertheless, the reform in the water sector is accompanied by great difficulties. The first associations were
registered only in 2010. At the moment 15 municipalities in 7 districts refuse to join the created W&S associations.
Those are mainly small municipalities. Thus on the territory of those municipalities no projects will be
implemented in the W&S sector with EU funding. The reasons for the municipalities’ unwillingness are mainly
two. The first one is financial, no matter how surprising that may seem at first glance. In those municipalities the
price of the W&S services is lower than the average. For instance in the Batak municipality the price is 0.65 lv.
and in the Separeva Banya municipality we find the lowest price of water supply and sewerage in Bulgaria of 0.55
lv. This is due to the mountainous relief of the municipalities and the possibility to use an entirely gravity-driven
water supply. For these municipalities joining an association would mean an inevitable increase in the prices. Their
leadership definitely refuse to take any such decision at this stage. Furthermore, the different municipal companies
finance each other by excusing each other’s debts – for example the W&S Company in the respective municipality
excuses and/or extends the debts of the remaining municipal companies (hospitals, municipal enterprises) and
institutions (schools, kindergartens). This facilitates their functioning in such a situation where the financial
difficulties do not stimulate but impede the building of inter-municipality cooperation contrary to all theoretically
justified and rational assumptions. Second, the reform is perceived by part of the municipalities as a form of
centralized governance, limiting of their authorities and expropriation of ownership precisely because of the mixed
character of the W&S associations. Some municipalities organize general assemblies of the population, such as
Kresna in August 2016 that took the categorical decision of rejecting membership in the W&S association. In the
Berkovitsa municipality whose population is 13 917 people, 7392 supported the decision not to join the Montana
W&S association in a petition. The municipal council respected the petition and rejected membership in the
association. To sum up, the reform in the water sector reproduces to a great extent the reform in the waste collection
sector. In spite of the benefits of the inter-municipality cooperation, it is not easily accepted in Bulgaria. The
municipalities resist firmly in all occasions where the law does not oblige them to participate.
4.3. The inter-municipality cooperation – is broadening of the scope possible?
The Bulgarian practice shows that even through on a purely rational level the benefits of the inter-municipality
cooperation might be evident this does not always lead to fast and easy introduction into the practice. In Bulgaria
the inter-municipality cooperation and for the provision of services in particular is not part of the governance and
administrative tradition. After the long period of centralized governance during the socialism the municipalities
find it hard to accept any form of centralization whatsoever, even if partial and actually the only option for
overcoming the extreme falling behind in the development of a specific sector and the provision of a relatively
good quality public service. Nevertheless, in the past years it is gradually penetrating the practice, but generally as
a result of the necessity to align the models of providing public services with the EU requirements related to the
utilization of the Structural Funds and/or with certain requirements of the Community policies. This hypothesis
was put to empirical verification in research. A major source of empirical information about the level of
development of the inter-municipality cooperation in Bulgaria are the projects financed with EU-funding.
An analysis was made to what extent the introduction of mandatory cooperation between the municipalities in the
waste water management sector has led to the adoption of this governance practice in other spheres where it is not
normatively mandatory. The answer to this question is sought through a comparison between all the projects
implemented under Priority Axis “Improvement and development of the waste treatment infrastructure” of OP
Environment in the 2007-2014 programme period and all the projects implemented under all the other operational
programmes in the 2007-2014 programme period. Priority Axis “Improvement and development of the waste
treatment infrastructure” was selected exactly because the activities of the beneficiary municipalities required
mandatory cooperation between the municipalities to be approved for financing. This analytical approach derives
from the assumption that as a result of the established practice a process of “learning” is developing and the
established governance and administrative practice is considered in spheres different from the one where it is
normatively required. Otherwise put, we are looking for an answer to the question whether the introduced approach
that is alien” to the domestic governance and administrative tradition has succeeded in changing, however slightly,
the governance and administrative practice in Bulgaria and activate the cooperation among the municipalities in
particular.
The participants in each project are compared under two indicators – participating partner municipalities and time
of implementing the project. It is analysed whether any of the participating municipalities in projects within the
framework of OP Environment, programme period 2007-2014 also participated in other projects in partnership,
i.e. “partner projects”. In the “partner projects” category all the financed projects by any of the remaining
operational programmes are included where at least two municipalities participated jointly for the construction of
a regional waste management system. In addition, the partnership project should be implemented after the date of
the regional waste management system project launching. This is a necessary condition, so that we can assume
with a good level of probability that the implementation of the second project was influenced by the experience
accumulated in the realization of the mandatory inter-municipality cooperation.
The analysis was made on the basis of data on the implementation of the projects from the Information System for
Governance and Monitoring of the Structural Instruments as of December 2014. A total of 18 projects were
examined for construction of regional waste management systems financed under Priority Axis “Improvement and
development of the waste treatment infrastructure” of OP Environment. The average number of partners in a
project is 4,7, where the largest number of partner municipalities participated in the construction of a regional
waste management system in the Vidin region6 – 11 partners and the smallest was in the Gabrovo region and the
Panagyurishte region –2 partners each. Each of the projects is worth nearly BGN 13 million up to over BGN 51
million. The implementation period of the projects was between 2 and 4 years. Their implementation period started
in 2010 but not all of them were completed by December 2014. The analysed regions are evenly spread over the
entire country territory (Table 1).
After the review of all the implemented projects of all the other operational programmes by December 2014 we
identified 16 “partner projects”. The average number of participating partners in them was 2 municipalities. In
only two occasions we have a considerably broader participation – 6 municipalities in the region of Burgas and 5
in the region of Stara Zagora. All the analysed partner projects were financed by OP Regional Development with
the exception of one project financed by OP Administrative Capacity. The implementation period is the same as
that of the regional waste management systems projects. The average value of the projects is much lower than that
of the regional waste management system projects – from slightly over BGN 300 000 to nearly BGN 900 000.
This of course is mainly due to the topic of those projects, the majority of which were for the creation and
promotion of regional tourist products. The costs of such projects are naturally much lesser than of the
infrastructure projects such as the regional waste management system projects (Table 1).
The dissemination level of the inter-municipality cooperation is not very high. After the implementation of a
regional waste management system project requiring mandatory cooperation between municipalities, usually only
one project is implemented with partner municipalities from among the partners in the previous project. In only 3
out of 18 cases we registered 2 follow-up partner projects and in 4 cases - no more partner projects. In addition,
the number of partners is substantially lower, in most of the cases up to 2 partners (Table 1). We cannot neglect
the fact that most “partner projects” were implemented under priority axes whose topic presumes cooperation
between the municipalities, although not always as a mandatory condition. The projects were predominantly within
the domains of OP Regional Development, priority axes “Sustainable development of tourism” and “Local

6
It must be pointed out that here we interpret a district or region not as any administrative territorial unit in the R.
of Bulgaria but the region, determined in the National Waste Management Programme.
development and cooperation”. With these axes most of the goals and activities were of regional scope and
therefore their achievement required cooperation among the municipalities. Thus the EU factor and its structures
was in the forefront again.
Table 1
OP Environment Follow-up "partner projects”
Number
of
follow Number of Total
Construction of Number of up participating amount of
regional waste partners Total amount Period. partner municipalities OP Regional partner
management system Start date municipalities BGN -months projects (unique) development projects
BOURGAS 25.8.2011 8 42 510 616 45 2 6 Yes 850 749
VIDIN 28.6.2011 11 20 515 302 46 1 2 Yes 457 091
PERNIK 30.11.2011 5 20 373 706 40 - - - -
BOTEVGRAD 23.11.2010 3 13 708 899 31 1 2 Yes 392 572
VARNA 17.7.2012 3 29 846 833 34 1 3 Yes 456 642
V. TURNOVO 15.1.2014 6 32 863 213 22 - - - -
GABROVO 13.7.2012 2 26 235 646 38 1 2 Yes 456 642
DOBRICH 14.12.2012 8 38 877 376 33 1 3 Yes 442 758
NIKOPLOL 26.7.2012 5 40 989 039 39 1 2 Yes 427 771
LUKOVIT 11.7.2012 5 22 219 441 40 2 3 Yes 618 205
PANAGURISTE 14.12.2012 2 18 299 655 33 - - - -
PLEVEN 29.11.2012 5 27 478 395 33 - - - -
RAZLOG 11.7.2012 4 12 899 180 42 1 2 Yes 477 096
STARA
ZAGORA 29.8.2012 12 51 959 314 39 2 5 Yes 888 646
HASKOVO 14.1.2013 3 28 454 919 32 1 2 Yes 307 950
YAMBOL 17.10.2012 4 31 324 461 33 1 2 Yes 305 866
TOTAL 86 458 555 994 34 6 081 988

A similar methodological approach was applied to the introduction of the inter-municipality cooperation in the
water sector. In this regard a survey was conducted of all the projects in the Information System for Governance
and Monitoring of the EU funds in Bulgaria in the programme period 2014-2020 by March 2017. First of all
projects with the participation of more than one municipality were identified. In the framework of the ISMM this
means analysing all those projects where the partner organization is a municipality. Again from the methodological
perspective it is important to emphasize the fact that the partner organization could be a legal entity that has 100%
municipal ownership, as well as NGOs functioning on the territory of the respective municipality. In those cases
in spite of the existing form of partnership we do not accept it as inter-municipality cooperation. Therefore for
each identified project all the key indicators were recorded, such as unique number, starting/end date, beneficiary
and total amount.
The result of the analysis of partner projects with the participation of municipalities/municipal organizations is
illustrated on Figure 1
Figure 1

EUfunds (2014 - 2020) projects with parthnership of municipalities - number

69
85
3
13
All non - IMC - IMC (municipal) - IMC (water)
Among the projects financed by the EU funds in the period 2014 – 2020 by March 2017 we identified 85 projects
where the partner organization is a municipality.7 From the perspective of the total number of projects financed by
the EU funds in the set (3178) this is a relatively small proportion – under 3% (Figure 1).
In accordance with the described approach the identified 85 projects should be analysed from the point of view of
the IMC definition. The results show that only 16 of them correspond to the definition of inter-municipality
cooperation. The remaining projects (69) are implemented in the form of partnership between the municipality and
an education institution like a school or kindergarten in the same municipality or a non-government organization,
again functioning on the territory of the municipality. This project type was excluded because it does not
correspond to the adopted definition of inter-municipality cooperation (Figure 1).
The projects that correspond to the definition of inter-municipality cooperation are 16. Two groups of projects
were identified in terms of their purpose of association. The first group of 13 projects was financed by OP
Environment 2014-2020. They feature cooperation in the field of improving the management of waters. In all the
cases the cooperation is between a specific municipality and a W&S association (W&SA). The remaining 3
projects were financed by different programmes than OP Environment 2014-2020 (Table 2).
Table 2
Projects with partnership of municipalities
EU Fund non-IMC IMC - municipal IMC - water Grand Total
Science and Education for Smart Growth 59 1 0 60
Human Resources Development 7 2 0 9
Regions in Growth 3 0 0 3
Environment 0 0 13 13
Total 69 3 13 85
62,5 mBGN 1,2 mBGN 657,6 mBGN 721,3 mBGN
projects - volume mill BGN

The other three projects fall in the social sphere and have a similar purpose – overcoming problems related to the
unemployment of young people and the absent ethnic integration. More specifically, the projects are as follows:
two of them have 2 participating municipalities and one has 3. In this case we cannot reasonably assert that the
practice of inter-municipality cooperation has been adopted in other spheres (Table 2).
An interesting fact is that although they are just 13, the projects involving inter-municipality cooperation in the
water field have generated an amount, exceeding substantially the total value of the remaining projects whose
implementation includes a partner municipality outside the inter-municipality cooperation practices. Figure 2
In fact the projects with inter-municipality cooperation have a 10-times larger budget (BGN 657 million) than the
budget of partner projects without IMC and the inter-municipality cooperation in the field of human resources
(BGN 1, 2 million) (Table 2).
Despite, we still need to take into consideration that the very presence of projects that spread to other spheres
makes the inter-municipality cooperation, introduced by the central government as a requirement a positive fact,

7
It should be pointed out that the small number of the analyzed 2014-2020 programme period projects is due to
the fact that it is still in an early stage and we cannot be sure whether at the end of the period the results will not
be similar to those of the previous period analysis.
especially in the 2007-2014 programme period. Regardless of their smaller scope in terms of the number of
participants, they are evidence of the existence of already stable cooperative and partner relations among the
municipalities. This should not be underestimated in view of the strong centralized governance tradition in
Bulgaria. Despite its limited success inter-municipality cooperation has the potential to become from sectoral
reform in to the reform at local and regional level of government (Kalfova, 2015, p. 85-86). It remains the only
politically acceptable alternative in Bulgaria. In addition, it has the potential to solve some of the problems of local
government that seem unsolvable - limited administrative capacity and insufficient own resources.

Conclusion
The analysis of the institutional system in Bulgaria, of the local authorities’ status in it, of the volume of authorities
the municipalities have presumes the introduction of inter-municipality cooperation as an inevitable reform. The
existing governance and administrative tradition can hardly allow for a different option. The introduction of
regional self-governance looks more and more as an impossible alternative that does not generate any serious
political support at the national level and is met with firm resistance at the local level. Neither of them is inclined
to yield any of its authorities to the benefit of the regional institutions. The merger of municipalities is practically
impossible under the Bulgarian legislation. However, the sharp need for reforms in numerous sectors and the
necessity for serious financial investments make the change inevitable. The cooperation between the municipalities
appears to be the most readily acceptable alternative both politically and from the perspective of achieving
effectiveness and efficiency in the provision of public services. In spite of all rational arguments, the transfer of
EU policies and practices to Bulgaria is the main and only factor of introducing the cooperation between the
municipalities for public service provision in Bulgaria.
Although no legal restrictions exist to the inter-municipality cooperation, it is not widely accepted in Bulgaria. We
can assert that it is not accepted in the public service provision except in the cases where it is a legal obligation. A
major example in this aspect is the inter-municipality cooperation in the waste management and W&S sectors.
These forms of cooperation have no or nearly no analogue in the Bulgarian practice. They fall entirely outside the
political and administrative tradition. The presence of even a small degree of centralization immediately arouses
the resistance of the municipalities. In addition, the arguments of the social cost of the reform and the restricted
opportunities for mutual financing between the municipal enterprises have led to an extremely difficult
introduction of the practice in Bulgaria. Despite, or precisely because of it we can be moderately optimistic.
Regardless of the tradition, the social cost and the short-term financial interest the inter-municipality cooperation
is still a fact and has reached a scope, however modest, outside the legally binding practices.
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