Guidelinse for Applicants

Ministry of Regional Development and Public Works

PHARE Programme – Economic and Social Cohesion

Pilot integrated investment Scheme

for regional development actions

(North-East Planning region)

Guidelinesfor grant applicants

responding to the call for proposals

for 2005

Budget line BG BG2003/004-937.11.03

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Table of Contents

1.Pilot integrated investment Scheme for regional development actions (North-East Planning region)

1.1Background

1.2Objectives of the Grant Scheme and priority issues

1.3Financial allocation provided by the MRDPW

2.Rules of This Call for Proposals

2.1Eligibility criteria

2.1.1Eligibility of applicants: who may apply

2.1.2Partnerships and eligibility of partners

2.1.3Eligible actions: actions for which an application may be made

2.1.4Eligibility of costs:

2.1.5Instructions for presentation of the Annex B - Budget

2.1.6Description of Grant Scheme’s components and components’ specific rules

2.1.6.1Business Related Infrastructure

2.1.6.1.1Background

2.1.6.1.2Objectives

2.1.6.1.3Type of eligible actions

2.1.6.1.4Size of grant

2.1.6.1.5Eligibility of Applicants

2.1.6.1.6Partnership

2.1.6.1.7Duration

2.1.6.1.8Eligible costs

2.1.6.1.9Ineligible costs

2.1.6.2Human Resource Development - Local Initiatives for Employment and Employability

2.1.6.2.1Background

2.1.6.2.2Objectives

2.1.6.2.3Type of eligible actions

2.1.6.2.4Size of grants

2.1.6.2.5Eligibility of Applicants

2.1.6.2.6Partnership

2.1.6.2.7Duration

2.1.6.2.8Eligible costs (specific for the component)

2.1.6.2.9Ineligible costs

2.1.6.3Integrated Support to regional/local tourism

2.1.6.3.1Background

2.1.6.3.2Objectives

2.1.6.3.3Type of eligible actions

2.1.6.3.4Size of grants

2.1.6.3.5Eligible applicants

2.1.6.3.6Partnership

2.1.6.3.7Duration

2.1.6.3.8Eligible costs

2.1.6.4Investment to Support Conditions and External Environment for Productive Sector

2.1.6.4.1Background

2.1.6.4.2Objectives

2.1.6.4.3Types of eligible actions

2.1.6.4.4Size of grants

2.1.6.4.5Eligible applicants

2.1.6.4.6Partnership

2.1.6.4.7Duration

2.1.6.4.8Eligible costs

2.1.7Other technical requirements related to this Call for Proposals

2.2How to apply and the procedures to follow

2.2.1Application form and supporting documents

2.2.2Where and how to send the application

2.2.3Deadline for receipt of applications

2.2.4Further information

2.2.5Acknowledgement of receipt

2.3Evaluation and selection of applications

2.4Notification of the contracting authority’s decision

2.5Conditions applicable to implementation of the action following the contracting authority’s decision to award a grant

3.List of annexes

Explanatory notes

List of Abbreviations

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1.Pilot integrated investment Scheme for regional development actions (North-East Planning region)

• Chapter 1 (p.4-6) –which gives an ESSENTALoverview to the entire document and useful information on the entire Grant Scheme;

• Section 2.1.1. – 2.1.4. of Chapter 2 (p.6-12) – which sets out general criteria and rules that apply to all applicants;

• Section 2.1.7. to the end of chapter 2 (section 2.2.-2.5.) and all annexes – which give ESSENTALinformation for all applicants.

• For component Business Related Infrastructure (non tourism) go to section 2.1.6.1. on page 15-17
• For component Human Resource development – Local Initiatives for Employment and Employability go to section 2.1.6.2. on page 18-21.
• For component Integrated Support to regional/local tourism go to section 2.1.6.3. on page 21-25
• For component Investment to Support Conditions and External Environment for Productive sector go to section 2.1.6.4 on page 25-30

1.1Background

The European Union is committed under its policy of “Economic and Social Cohesion” to “reducing disparities between the levels of development of the various regions and the backwardness of the least favored regions”. Bulgaria already participates in this policy through the Pre-Accession Instruments Phare, ISPA and SAPARD. Under Phare it is building its capacity to benefit fully from Structural and Cohesion Funds which will be the main instruments for this policy after Accession.

This Grant Scheme marks an important step in Bulgaria’s preparations for future Structural Funds. Firstly it provides significant investment to North East Bulgaria. Secondly it helps prepare and pilot structures and systems and develop important capacities and capabilities for effective use of Structural Funds. As such this GrantScheme has an important “pilot” character. It is a learning exercise for all concerned.

This GrantScheme is also important in that it is “integrated”. In simple terms this means that it seeks to unite various development priorities and resources under a single roof that can more effectively address development needs of the NE region. It is multi-sectoral in its scope and yet aims at common objectives. The GrantScheme designers have aimed, within practical limitations, to encourage the various implementing bodies, regional development actors and project developers to concert their activities in order to achieve an effect that none of them could achieve in isolation. The Scheme encourages joint working and partnership where possible. In the area of tourism especially, it makes provision for project promoters and development actors to integrate their activities within a single application. In other components the Scheme encourages projects with a logical set of appropriately integrated actions that provide a real development impact.

The Scheme makes an important contribution to Bulgaria’s National Development Plan and especially to the Regional Operational Programme (ROP). It is both consistent with these as they currently exist and will help inform their final development in the run-up to EU Accession.

In particular this Scheme builds on significant efforts that have already taken place in Bulgaria and the NE Region in recent years. These have involved the careful preparation of various strategic documents, the identification of possible intervention areas. More recently and as part of the preparation of this Scheme, a team of consultants have been engaged by the MRDPW to ensure appropriate design of the Scheme, based on a comprehensive mapping exercise of the current project pipe-line and development needs of the NE Region. In this manner it is intended that this Scheme should support good quality projects in key areas that contribute to the economic and social development of the North-East Region and that can be effectively implemented within the disbursement period for the Scheme.

1.2Objectives of theGrant Scheme and priority issues

The Grant Scheme’s overall objectives are:

1. To pilot and test - in the context of preparation for Structural Funds and especially of the future Regional Operational Programme (ROP) - an integrated programme approach that contributes to the economic and social development of the NE region, develops key programme design, implementation and monitoring/evaluation competencies nationally and within the Region, identifies and reinforces regional and local approaches complementary to main sectoral/national interventions.

1. To enhance specific factors and conditions that support regional development especially in terms of business and tourism development or that provide local pathways for target groups into the labour market and its support mechanisms – thus contributing to regional competitiveness and social cohesion.

1.3Financial allocation provided by the MRDPW

The overall indicative amount made available under this call for proposals is 6.14 MEUR(4, 60 MEUR from Phare, 1.54 MEUR from the state budget). The contracting authority reserves the right not to award all available funds.

The overall indicative amount will be further allocated to the four components as follows:

Should it occur that there is not a sufficient number of good projects to absorb the allocated funds for a particular component, a proportion of these funds may be reallocated to support good projects selected under other components.

Size of grants

Any grant awarded under this programme must fall between the following minimum and maximum amounts:

Moreover, no grant may exceed 90% of the total eligible costs of the action (see also section 2.1.4). The balance must be financed from the applicant's or partners' own resources or from sources other than the European Community budget.

The applicant must present a clear budget breakdown justifying the amount of the requested grant.

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2.Rules of This Call for Proposals

These guidelines set out the rules for the submission, selection and implementation of actions financed under the programme, in conformity with the provisions of the Practical Guide[1].

2.1Eligibility criteria

The first 4subsections of this section refer to general eligibility criteria which apply to actions related to all four components of the Pilot Integrated Investment Scheme. In addition to the general eligibility criteria, specific eligibility criteria for applicants, partners, actions and costs are presentedfor each component in the next subsection (see 2.1.6 below). Applicants should refer to BOTH sections and respectively type of criteria.

Eligibility criteria relaterespectively to:

• organizations which may request a grant,
• actions for which a grant may be awarded,
• types of costs which may be taken into account in setting the amount of the grant.

2.1.1Eligibility of applicants: who may apply

(1) In order to be eligible for a grant, applicants must:

• be municipalities or associations of municipalities, organizations founded or run by municipalities, non governmental organizations, (e.g. professional chambers, branch associations, accredited public training organizations), etc;
• be non-profit-making legal persons;
• be organizations either located in the NE region or organizations with a registered branch office located in the NE region or must clearly demonstrate appropriate links to the NE region[2] and have facilities to implement the project with sustainable benefits in the region;
• be directly responsible for the preparation and management of the action, not acting as an intermediary;
• if a non governmental organization, the respective NGO has to prove, as per court registration, that has been in operation for at least two years prior to the date of this Call for Proposal;
• have stable and sufficient resources of finance for co-financing of at least 10% of the overall eligible costs of the action;
• be experienced and able to demonstrate their capacity to manage larger scale activities corresponding to the size of the action for which a grant is requested.

(2) Potential applicants may not participate in calls for proposals or be awarded grants if:

(a)they are bankrupt or being wound up, are having their affairs administered by the courts, have entered into an arrangement with creditors, have suspended business activities, are the subject of proceedings concerning those matters, or are in any analogous situation arising from a similar procedure provided for in national legislation or regulations;

(b)they have been convicted of an offence concerning professional conduct by a judgment which has the force of res judicata (i.e. against which no appeal is possible);

(c)they are guilty of grave professional misconduct proven by any means which the contracting authority can justify;

(d)they have not fulfilled obligations relating to the payment of social security contributions or the payment of taxes in accordance with the legal provisions of the country in which they are established or with those of the country of the contracting authority or those of the country where the action is to take place;

(e)they have been the subject of a judgment which has the force of res judicata for fraud, corruption, involvement in a criminal organization or any other illegal activity detrimental to the Communities' financial interests;

(f)they have been declared to be in serious breach of contract for failure to comply with their contractual obligations in connection with a procurement procedure or other grant award procedure financed by the Community budget.

Applicants are also excluded from participation in calls for proposals or the award of grants if, at the time of the call for proposals, they:

(g)are subject to a conflict of interests;

(h)are guilty of misrepresentation in supplying the information required by the contracting authority as a condition of participation in the call for proposals or fail to supply this information;

(i)have attempted to obtain confidential information or influence the evaluation committee or the contracting authority during the evaluation process of current or previous calls for proposals.

In the cases referred to in points (a), (c), (d), (f), (h) and (i) above, the exclusion applies for a period of two years from the time when the infringement is established. In the cases referred to in points (b) and (e), the exclusion applies for a period of four years from the date of notification of the judgment.

Applicants must supply with their applications a sworn statement that they do not fall into any of the above categories (a) to (f).

2.1.2Partnerships and eligibility of partners

Applicants may act individually or in consortium with partner organizations.

Applicants’ partners participate in designing and implementing the action, and the costs they incur are eligible in the same way as those incurred by the grant Beneficiary. They must therefore satisfy the same eligibility criteria as applicants[3] (see 2.1.1 above as well as 2.1.6).

The applicant will act as the lead organization and, if selected, as the contracting party (the "Beneficiary").

Applicants’ partners participate in designing and implementing the action, and the costs they incur are eligible in the same way as those incurred by the grant Beneficiary.

Other organizations may be involved in the action as associates. Associates play a real role in the action but may not receive funding from the grant. Associates do not have to meet the eligibility criteria referred to in section 2.1.1

Subcontractors are neither partners nor associates, and are subject to the rules set out in Annex IV to the standard grant contract.

A detailed specification of partners (associates) for each component is given in the section 2.1.6

2.1.3Eligible actions: actions for which an application may be made

Duration

The duration of an action may not exceed 18 months.

Sectors or themes

The Pilot Integrated Investment Scheme will provide support to successful projects under the following components:

Component 1: Business related infrastructure

Component 2:Human Resource Development -

Local Initiatives for Employment and Employability

Component 3:Integrated support to tourism development

Component 4:Investment to Support Conditions and External Environment for Productive Sector

A detailed description of each component is given in the section 2.1.6

Location

Actions must take place in Bulgaria, in the North East NUTS II Planning Region, on the territory of the following districts: Varna, Dobrich, Shoumen, Razgrad, Silistraand Targovishte.

Type of actions

The actions are specific for the different components:

• The Business Related Infrastructure component will support municipal investment in physical infrastructure serving business sites/areas thus improving the environment for operation of existing businesses and attracting new ones.

• The HRD component “Local Initiatives for Employment and Employability” focuses on local, relatively small-scale activities, responding to need, complementary to national / sectoral interventions, and undertaken by regional or local actors - municipalities and non-profit NGOs.

• The Integrated Support to Regional/Local Tourism component of theGrant Scheme will support investment in physical infrastructure (basic tourism), in improving conditions and external environment for the tourism sector as well as in human resources development activities required to carry out project activities and sustain its results.

• The Investment to Support Conditions and External Environment for Productive Sector Component will support projects that offer support services to SMEs in the productive or traded services sectors, specifically to either Start-Ups or Existing Companies.

The following types of action are ineligible: