ZAGREB, 29 Sept, 2021 - President Zoran Milanović said on Wednesday that as far as Zagreb's post-quake reconstruction was concerned, the processes "are already entering the red zone", warning that the financial situation in Zagreb is not good because the previous city administration brought it to the edge of the abyss.

"If we are talking about Zagreb's reconstruction we are already entering the red. The financial situation in the City of Zagreb, as far as I have heard, is not good and not because of its current authorities but its previous administration. They invoiced or tried to invoice and give away anything possible over the past years. And in the end, we all know how that ended - the other option won and it is barely making ends meet," said Milanović.

Asked about Zagreb's reconstruction following the 2020 earthquake, Milanović said that it was important for Prime Minister Andrej Plenković to dedicate attention to the issue of Zagreb's finances.

"There is no room for bartering and agreements. The City of Zagreb cannot incur debts above certain levels and the previous authorities have brought it to the edge of the abyss," said Milanović.

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ZAGREB, 10 June 2021 - After his first meeting with Prime Minister Andrej Plenković and his ministers, Zagreb Mayor Tomislav Tomašević said that nobody can be satisfied with the rate of reconstruction in Zagreb and that he expects a new era of cooperation between the city and the state.

Tomašević and Plenković met in Government House and discussed cooperation between the government and the City of Zagreb after the 22 March 2020 earthquake and the situation regarding the city's finances. Finance Minister Zdravko Marić, Physical Planning, Construction and State Assets Minister Darko Horvat and Deputy Zagreb Mayors Danijela Dolenec and Luka Korlaet also participated in the hour-long meeting.

The main topic of the talks, held on the day that the first house with a red label in Zagreb was demolished, was post-earthquake reconstruction.

"We are glad that the demolition of damaged buildings is finally starting. Today three are being demolished, and more will follow in the days to come," said Tomašević.

Admitting that nobody can be satisfied with the rate of reconstruction, he said that the City of Zagreb would from now on be a proper partner so that the process is accelerated, particularly with regard to filling out application forms for apartment buildings.

Horvat and Tomašević announced that they would conduct a working meeting on Tuesday to discuss handling construction waste material as temporary landfills are full, as well as ways to accelerate reconstruction.

Not one decision on reconstruction will be political but based on expertise

"Bulldozers are positioned at three locations in Zagreb and buildings are being demolished," Minister Horvat said and added that the ministry had so far sent 36 decisions for demolition to the Reconstruction Fund and that another 18 decisions would be forwarded this week.

Responding to accusations by the fund's director, Damir Vanđelić, that the ministry was a bottleneck in making decisions related to reconstruction, Horvat said that the problem was no longer the ministry but the Fund itself.

"(Vanđelić) received the first decision for demolition on 20 April and he managed to arrange the first works on 10 June. We are no longer talking about expediting the adoption of decisions but about the implementation of public procurement for bulldozers to appear in the field. That isn't a job for the ministry but for the fund's director," said Horvat.

He added that he would insist on the current reconstruction model and on decisions that were not political but based on expertise.

By the end of the month, the fund will have on the desk some 60 decisions for demolition of the 169 that were received by the ministry. As for the remaining applications, the relevant documentation is being collected and property-rights relations are being dealt with, he added.

He stressed that 3,800 applications for reconstruction that had been submitted in Zagreb had still not been resolved because they involved buildings that did not have legal building permits.

Tomašević stressed that city authorities would contribute to expediting the process of reconstruction by helping citizens complete application forms and conducting quick inspections for damage carried out on the remaining buildings that had not undergone such inspections.

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ZAGREB, 22 March, 2021 - A Zagreb Mayor hopeful, Tomislav Tomašević, warned on Monday on the first anniversary of the Zagreb quake that nothing had been done in the post-quake reconstruction and promised the rebuilding of the city in four dimensions if he won the 16 May local election.

"We have come to know that we do not have not one decision forwarded to the Reconstruction Fund nor has any action been taken," Tomašević told a press conference in front of the City Hall, which was organised by his We Can party and its partners: "Zagreb is Ours " and OraH parties.

He warned that the fund and Ministry of Construction are passing the buck regarding to whether decisions have been written or not and the problems they had outlined during the debate on the Reconstruction Act have now occurred.

He pushed for bringing together experts under the one roof so that good decisions can be made faster.

Tomašević said the current situation could be seen as an opportunity for reconstruction and also for earthquake-resistant development of the city in four dimensions including physical reconstruction which is aimed at increasing earthquake resilience and developing earthquake-proof infrastructure.

The plan is also to reconstruct public places which will give a social dimension to the historical centre of town and suburbs on the rim of Sljeme mountain that will include local construction companies in rebuilding projects and will increase energy efficiency and improve the quality of living as part of the fourth "green" dimension. 

MP Sandra Benčić added that the Reconstruction Fund had received money however it was not being used because blueprints had not been approved through a tender that was advertised.

They believe that the key mechanism to fund reconstruction is in the European ITU mechanism of integrated territorial management whereby structural funds are are managed by city agglomerations.

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ZAGREB, 22 March, 2021 - The government has taken steps to make sure that  €3.8 billion (HRK 28.5 billion) can be provided for reconstruction and revitalisation in the quake-affected areas, Prime Minister Andrej Plenković underscored on Monday at the first Croatian conference on earthquake engineering - 1CroCEE.

The conference was organised by the  Faculty of Civil Engineering in Zagreb on the first anniversary of the 5.5-strong tremor that struck Zagreb and its environs on 22 March 2020.

Plenković recalled today the extent of the damage to Zagreb and its environs and then later to the Banovina region which was struck by the 6.2-strong quake on 29 December was truly enormous.

The damage is estimated at HRK 86 billion in Zagreb and its environs and HRK 41.6 billion in the Banovina area in Sisak-Moslavina County. The sum total of the quake damage is put thus at HRK 128 billion.

For that expensive and long process of the reconstruction to be implemented it is essential to secure the necessary funds, particularly from European and international sources, said Plenković.

The government has to date taken intensive activities at all levels for reconstruction and revitalisation of affected areas  so as to secure €3.8 billion or about HRK 28.5 billion, which is 22% of the funds required.

Of that amount, almost €1.4 billion is from European sources and €2.4 billion through international financing institutions.

The European funds include €684 million from the EU Solidarity Fund for Zagreb's reconstruction and almost €600 million is planned through the Recover and Resilience Mechanism, while €111 million will be reallocated from the Competitiveness and Cohesion Operational Programme from the existing Multiannual Financial Framework (MFF), he said.

In addition, we will endeavour to secure funds from the new EU Multiannual Financial Framework  which is currently being programmed and financing reconstruction will be treated as a specific item, said Plenković.

When it comes to international financing institutions, in addition to an already contracted loan of €184 million from the World Bank, talks will be conducted for an additional €1 billion from the European Investment Bank (EIB), €900 million from the Council of Europe Development Bank (CEB) and €300 million from the European Bank for Reconstruction and Development (EBRD).

An additional €319.2 million needs to be added to all that which Croatia requested from the European Solidarity Fund for the removal of damage caused by the earthquake in the Banovina region, he added.

Plenković added that constant talks were being held with a series of development and commercial banks to come up with solutions that will provide credit lines with favourable interest rates for individuals. That primarily refers to the 20% of the costs they need to cover reconstruction, to finance the difference between structural repairs and complete reconstruction, to finance the reconstruction of apartment buildings and also to fund the reconstruction of public buildings by the state.

"We are about to enter the phase of organised structural repairs and comprehensive reconstruction, not just in Zagreb but in neighbouring counties," said Plenković.

He underscored that reconstruction should boost a new large development cycle for Zagreb and neighbouring counties as well as trigger the revitalising of the Banovina region.

World Bank director for Croatia and Slovenia, Elisabetta Capannelli, said that the estimated quake damage was equal to reached 30% of Croatia's GDP.

ZAGREB, 22 March, 2021 - Social Democratic Party (SDP) leader Peđa Grbin and the SDP candidate for Zagreb Mayor, Joško Klisović, warned on Monday, on the first anniversary of the 22 March 2020 earthquake in Zagreb, that reconstruction had still not begun and that the capital should not only be reconstructed but revitalised as well. 

"Over the past 12 months, a law on reconstruction was adopted and after the earthquake in Petrinja, it was expanded to include the Banija region, but, as we can hear from the Reconstruction Fund.... no decision on reconstruction has arrived at the Fund from the Construction Ministry. The Ministry claims it has sent three decisions for the reconstruction of buildings, but even though the Ministry and the Fund are located only a few metres from one another, those decisions have still not reached the Fund," Grbin warned at a news conference.

If reconstruction in Zagreb as well as in Banija continues at the current pace, the question is if it will ever end and if people whose houses and buildings were damaged will be able to ever return to their homes, he said.

Grbin called on the government to ensure that reconstruction work finally started, criticising the Reconstruction Act by saying that the structural reconstruction as envisaged by it would not be sufficient as people did not have money to finance non-structural reconstruction.

Those who will have to seek loans to co-finance 20% of structural reconstruction costs will not be able to co-finance the reconstruction of other parts of their property which are equally important for normal living, he said, calling for reexamining the Reconstruction Act.

He also called for reexamining the law to expand the scope of reconstruction work to enable the revitalisation of the earthquake-damaged parts of the capital city.

"We call for renovating all buildings, with red, yellow and green labels alike, because any next quake could destablise these buildings again and cause a disaster. Around 30% of the housing stock in downtown Zagreb is older than 100 years, which means that we need an integral, radical reconstruction of the city," SDP mayoral candidate Klisović said.

He noted that given the current favourable situation on the international financial market, funding for that purpose should be sought there, mentioning also the possibility of issuing long-term bonds.

Klisović said that as mayor, he would define a price catalogue for reconstruction work considering fast-growing prices and the fact that people who have to hire a company to do reconstruction work do not know how much a certain type of work costs.

He noted that the state should increase the rate for co-financing reconstruction costs for people who live in buildings categorised as cultural property, calling also for the introduction of a special credit line for those reconstructing their houses and on the state to cover interest on those loans.

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ZAGREB, 22 March, 2021 - Physical Planning and Construction Minister Darko Horvat said on Sunday, ahead of the first anniversary of the 22 March 2020 earthquake in Zagreb, that preparations for the process of reconstruction were underway and that organised reconstruction would start in June.

"The process has not come to a halt. It is complex and is proceeding slowly," the minister said in an interview with Nova TV, noting that buildings damaged in the earthquake had been prepared for demolition or reconstruction.

He noted that a delay was possible if problems occurred in the procurement and appeals procedures.

"But we plan to have concrete contracts and start with organised reconstruction in June," Horvat said.

He noted that the reconstruction process would be carried out by Croatian construction companies but that foreign ones could be hired as well, depending on the dynamic of obtaining the necessary funding.

Asked if the state would cover interest on loans to be taken by citizens for reconstruction costs, Horvat said that this was being discussed with banks and that it yet remained to be seen if the state would also take over the financing of a part of the loan principal.

He recalled that staff at his ministry could help citizens write requests for reconstruction and that those requests could be submitted by mail or through the e-obnova system.

Until all contracts for the entire job of reconstruction are signed, there will be no excavators in the streets, Horvat said.

"If we want to use money approved by the European Commission fairly and in line with strict EC rules, the procedure must be followed," he said.

ZAGREB, November 6, 2020 - Construction Minister Darko Horvat said on Friday that the organised post-earthquake reconstruction of Zagreb and Krapina-Zagorje and Zagreb counties would start in early spring and that EU funds for that purpose should be paid already around December 1.

"A certain number of projects are nearing completion and we will start with them. I am optimistic that organised reconstruction will start already in early spring," Horvat said after a meeting of an expert group in charge of EU reconstruction grants.

The minister said that requests for the payment of close to HRK 80 million worth of finished reconstruction work had arrived, adding that of around 130 facilities in the education system requiring reconstruction, 119 had been repaired.

Horvat dismissed as insinuation claims that one was stalling with reconstruction and that nothing was being done in that regard.

The Fund for the Reconstruction of the City of Zagreb, Krapina-Zagorje and Zagreb Counties has been formally registered today, Horvat said, noting that the fund will primarily be in charge of the process of reconstruction of privately-owned houses and apartment buildings.

He said that more than HRK 250 million had been secured from the state budget for the Fund's work and that at the moment there was sufficient funding for organised reconstruction in Zagreb and the two counties in 2021, 2022 and 2023.

The rest of the European money will arrive when the triage is completed and when the European Commission, European Parliament and European Council reach agreement, Horvat said, noting that this could happen around December 1.

18-month deadline to justify money spent

Once the EC pays the entire amount for reconstruction work, totalling €683.7 million, an 18-month deadline starts running during which the amount spent will have to be justified, he said.

The deadline for the establishment of a mechanism to supervise how the money is spent is November 15, Horvat said, adding that a decision on the matter would be ready by the government session next Thursday, when implementation bodies in the competent ministries would be determined.

After the government session, the relevant documents will be sent to Brussels and information on their verification or necessary correction will arrive soon, meaning that a formal decision will arrive by December 1, after which payments will be made into the state budget. The finance minister will then distribute the HRK 5.1 billion for reconstruction work among government departments, said Horvat.

At a recent session the government approved the establishment of the Fund for the Reconstruction of the City of Zagreb and Krapina-Zagorje and Zagreb Counties, appointing Damir Vandjelic its temporary director.

PM Andrej Plenkovic said that the signing of the agreement on the Fund's establishment marked the formal beginning of reconstruction work in Zagreb following the March 22 earthquake.

ZAGREB, Sept 11, 2020 - The Croatian parliament on Friday adopted the act on the post-earthquake reconstruction of Zagreb and of Krapina-Zagorje and Zagreb Counties, with 124 parliamentary deputies supporting the legislation.

A total of 138 parliamentary deputies participated in the voting, and ten abstained from it, while four voted against.

In the 151-seat parliament, apart from deputies of the 76-strong ruling majority, also some of the Opposition lawmakers voted for the act.

Four parliamentary deputies who are self-isolating voted via video link, which happened for the first time in the Croatian legislature.

Under the act, the government will provide 60% of the funding for the structural reconstruction of private buildings, while local government units and owners will each contribute 20%.

Property owners whose monthly income does not exceed HRK 4,000 and those whose property was worth less than HRK 200,000 on the day of the earthquake will also be entitled to free reconstruction. This will also apply to disabled Homeland War veterans, disabled persons, and welfare beneficiaries who receive maintenance support.

The owners of the property which will be reconstructed under this scheme are not allowed to sell it within five years upon the rebuilding.

The government is supposed to inform the parliament once a year about the process of reconstruction under this act.

26,000 buildings damaged in the 22 March quake

The March 22 earthquake has been the most destructive in the last 100 years and it claimed the life of a young girl in downtown Zagreb.

The damage caused is estimated at HRK 86 billion, which is about 60% of the state budget and surpasses anything Croatia has experienced.

Some 25,000 buildings were damaged in the City of Zagreb, 510 in Zagreb County, and 409 in Krapina-Zagorje County, or nearly 26,000 buildings in total. About 1.5% of them are public buildings and 98.5% are privately owned.

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