Bashtanska Consolidated Community Reaches Success through Transparent Procurement Procedures

Bulldozer procured for Bashtanska CC

Co-Authors: Head of Bashtanska Consolidated Community and the Department Specialists
“The story about savings started in 2018, when Bashtanska Consolidated Community (CC), established in 2017, decided to purchase a bulldozer to handle a landfill site. To budget for the needed costs, we had to do market research. The price for similar machinery ranged between 5.4 mln Ukrainian Hryvnia (UAH) to 3.8 mln UAH. Notably, we aimed for 3.8 mln UAH as the base price and announced a call for commercial offers in October 2018,” explains Tetyana Zavorotnyuk, a procurement specialist in Bashtanska CC.

According to Zavorotnyuk, four bulldozer-producing companies participated in the tender. The company from Zaporizhzhia was granted the offer, as during the auction, its representatives lowered the price to 2.7 mln UAH – 29% off the originally expected price. Thus, the residents of Bashtanska CC saved over one million UAH thanks to transparency and the open tender procedure.

The local governance re-allocated 900 thousand UAH from the amount saved to go to the education sphere. Local schools and kindergartens received additional funding support to procure sports equipment, remodel the sports club in the village school, and repair the roof that had been leaking in one of the kindergartens.
In the opinion of Tetyana Postyka, Head of the Bashtanska kindergarten called “Cheburashka,” it became much warmer on the upper floor after the roof was repaired and insulated. Previously, when it snowed, the snow would fall inside the building and melt, creating multiple leakages in different parts of the ceiling.

Head of Bashtanska CC shares local experience of successful procurement
“In 30 years, there has not been any remodeling done here in the sports club–the ceiling was in a very bad state–cracking, chipping paint, and the color of the paint was that used during Soviet times –dark. Nowadays, everything is a light color, there is a lot of space; new windows have been recently installed, as well as a new lighting set up. Moreover, in the school, for the first time, indoor bathrooms have been installed. This is the biggest positive in the last 20 years!” shares Valentyna Kotovska, Head of the local school in the village of Yavkine.

Public Procurement Specialist for the Department of Education, Youth and Sports for the Executive Committee at Bashtanska City Council, Vladelina Shepel, thinks that these changes in the community were made possible due to the application of competitive procurement mechanisms instead of signing non-transparent direct contracts. For example, if a school needs a new fridge, the city budget may only have 20 thousand UAH available for purchasing one. According to current legislation, the Education Department is eligible to procure goods valued less than 200 thousand UAH in two possible ways. The first way is to purchase directly through a contract from a vendor they find on their own. The second way is to post a request for tender using the ProZorro platform and proceed with an auction, which will determine the cheapest proposal. Although the second option may take up to two weeks longer, the city could be able to save up to four thousand UAH on the fridge, and the leftover amount could be spent towards, for example, a freezer, for another kindergarten.

As Ivan Rubskyy, City Head, states, “In performing public procurement in local governance agencies, the level of efficient budget spending increases, and the risks for corruption decrease. Within the CC this may bring impressive results – finance turnover increases, expenses for purchases will go much lower, there will be no room for doing unreasonable procurement. This will help to cut down on expenses and re-allocate finances to other areas to ensure economic development of the CC.”

As of now, three out of four procurement cases for the Department of Education, Youth and Sports for Bashtanska City Council have used competitive procedures. They received 143 tender calls with expected expenses of 44 mln UAH, and managed to save 7.8 mln UAH. In two years, the Department could save 12 mln UAH. Notably, community specialists achieved significant results due to their participation and acquired knowledge at trainings facilitated by USAID DOBRE Program, implemented by Global Communities.

In addition, USAID DOBRE experts carried out an assessment of public procurement in 75 DOBRE partner CCs in order to analyze the level of compliance with legislation requirements and non-compliance, if any. As it turned out, there had been a lot of mistakes identified that signified gaps in theoretical knowledge and a lack of experience among tender committee members. Therefore, to bridge those gaps, DOBRE specialists developed Action Plans to address identified needs and to prevent further errors, as well as created a cycle of two-day trainings to enhance competences on public procurement among tender committee members from partner CCs. The designed trainings were rolled out in seven DOBRE oblasts. On a consistent basis, similar consultancy support is provided upon request, since there is still a high need for increasing the level of transparency in public procurement procedures locally.

According to data from 2019, there are 881 consolidated communities functioning in Ukraine. This story of “Bulldozer from Bashtanska CC” is one example highlighting how a transparent electronic system and professional approach from local governance has helped to create an environment of healthy competition and economy. The achievements allowed the CC to find extra financial resources to improve their situation in additional problematic areas.

These new tools and approaches are available for everyone—the most important thing is the desire of local governance representatives to implement them in their daily routines.

Decentralization Offering Better Results and Efficiency (DOBRE) Program is USAID’s five-year program, implemented by Global Communities. The Program is working to support the supply of good local governance and create improved conditions for the development by consolidated communities (CCs), increase citizen engagement in decision-making, and ensure accountability and transparency in public administration. The DOBRE Consortium, led by Global Communities, includes: Ukrainian Crisis Media Center (UCMC), Social Boost, Foundation in Support of Local Democracy (FSLD/FRDL), Malopolska School of Public Administration at the Krakow University of Economics (MSAP/UEK), Poland, National Democratic Institute (NDI). The USAID DOBRE Program is implemented in seven target oblasts: Dnipropetrovska, Ivano-Frankivska, Kharkivska, Khersonska, Kirovohradska, Mykolayivska, and Ternopilska.