Relative of Bulgarian MP Repairs Buildings with EU Funds in Breach of OPRD Contract

Companies linked to the ruling center-right party Citizens for European Development of Bulgaria (GERB) and the party largely representing the Muslim minority, Movement for Rights and Freedoms (DPS), have shared BGN 20 million to rehabilitate schools in the city of Haskovo. The municipality poured even more.

Workers from Eco Tradex Group, a company owned by a relative of GERB lawmaker and former GERB Energy Minister, Delyan Dobrev, are rehabilitating a kindergarten in Haskovo in violation of the European Union (EU) funding contract, which was won by other companies, a team of Bivol established on location. The contract for BGN 1.9 million explicitly states that subcontractors are not allowed. Meanwhile, a company of the wife of a former DPS MP and regional party leader is rehabilitating another day care, but the site is unlikely to be delivered on time. Because of this and other violations, the municipality may face financial penalties imposed by the EU, which will ultimately come from the municipal budget.

Relative of Bulgarian MP Repairs Buildings with EU Funds in Breach of OPRD ContractRelative of Bulgarian MP Repairs Buildings with EU Funds in Breach of OPRD Contract

Under the contract, subcontractors are not allowed, but a team of Bivol spotted on location workers of Eco Tradex Group, a company owned by Dobrev’s relative.

The rehabilitation contract is signed with the consortium EE Engineering for BGN 1.9 million.

High rehabilitation achievers

The co-owner of Eco Tradex Group, Daniel Gargov, is the husband of a first cousin of Dobrev – Rositsa Gargova, who is at the key post of Director of “Financial and Accounting Activities and Budget” in the Haskovo Municipality (see here). Eco Tradex Group is in the top three companies that have received money from the budget and has won public procurement for over BGN 100 million, according to a research by the news site Mediapool. Obviously, however, this is not enough, because the company has become a subcontractor in the rehabilitation of public buildings with European money.

Daniel Gargov is a municipal councilor from GERB in the Haskovo City Hall and Chairman of the Budget and Finance Committee. He was precisely the one to present on August 16, 2017 a report to an extraordinary session of the Municipal Council with a single item on the agenda – a proposal for additional financing for the contractors in the amount of BGN 442,781, although they are not included in the EU Operational Program Regional Development  (OPRD) contracts or in the municipality budget.

The companies will likely get this money after Mayor Dobri Belivanov signs under the proposal but will have to wait until next year due to lack of funds in the budget now. They will get them because 32 out of 41 councilors were in attendance and 23 of them voted for, four abstained, and five were against. Belivanov remained silent during the extraordinary session, but later told journalists he was confident that there are no committed violations.

The biggest chunk will go to another well-connected businessman

The biggest amount is slated for the company ET Metallic – Ivan Mihaylov – BGN 271,112 with VAT. It has a contract under OPRD for over BGN 3 million for the largest building in this particular project. “Sudden, unpredictable and unforeseen problems” have forced Ivan Mihaylov to reach out to the municipality for more money. The big businessman from the second-largest city of Plovdiv has won with this company public contracts for millions, such as the construction of the wall along Bulgaria’s southern border. He has a close business relationship with Todor Boyadziev, who is the best man of former Interior Minister and current lawmaker and always a prominent figure from GERB, Tsvetan Tsvetanov. Boyadzhiev’s name came to fame in connection with the “Dunes Gate” scandal. Their companies are part of several consortia to implement infrastructure projects, according to the Daxy information system. According to Bulgarian media reports, in addition to contracts for millions in the construction sector, during the term of office of Tsvetanov as Interior Minister, this consortium was one of the main donors of the Ministry of Interior.

Another Haskovo school rehabilitation bid was won by the company Indzhovstroy. However, this company has also encountered a number of unavoidable and unforeseen problems and needs an additional BGN 159,188 with VAT from the municipality. The day before the voting, our team found inside the school only person, the technical manager, Milko Andreev, and one worker who was having lunch outside.

Another best man

At the entrance, our team was crossed paths with Evgeni Konsulov, Deputy Mayor of Haskovo in charge of Construction. Konsulov is the son of Dr. Konsulova, a municipal councilor from GERB. He is another person close to Delyan Dobrev. From 2006 to 2008, both were on the Board of the Association “Agency to Support the Development of Small and Medium Businesses” registered in the Haskovo District Court. Konsulov and Dobrev are not family related, but according to media sources, Dobrev is Konsulov’s best man.

Deputy Mayor for Construction in Haskovo, Evgeni Konsulov, inspects unfinished sites.

The first, which Konsulov underscored with evident satisfaction, was that “the repairs of the buildings from the educational infrastructure have been assigned to a total of six companies, which indicated prices about BGN 3.5 million lower than the forecasts for public procurement at an estimated total amount of BGN 20 million”. Responding to the question of why additional funding for public procurement is required without being included in the contract clauses, he pointed out that firms had encountered “unforeseen design-related activities such as additional plastering “.

According to him, in the past the municipality also had to finance such annexes to the contracts, but for the first time now the proposal will be a voting item on the agenda of the Municipal Council as this was at the request of Mayor Dobri Belivanov. Deputy Mayor Konsulov also noted that BGN 500,000 has been provided for unforeseen expenses in the municipal budget. The technical manager Milko Andreev was adamant that subcontractor services were not used. The renovation of the school is at the finish line, he said and took us on a thorough walk.

Andreev pointed to a large box with multiple flat cables coming out, mounted on the wall under the ceiling of the hallway, noting that only this one had cost BGN 3,600, while the necessity of mounting it had come up in the course of the repair works without being included into the project. With a total of five such “suitcases” there is BGN 18,000 in extra costs for this segment only, Milko Andreev specified. He also showed us impact strips on the edges of the classroom walls that were another unpredictable extra and due to these extras the company wants from the municipality an additional nearly BGN 160,000.

Against this backdrop, the request by the company Aqua-3 for BGN 12,481 with VAT seems very modest.

The amounts requested by the three companies were included in the report of Mayor Dobri Belivanov submitted on August this 4, 2017, for the regular session, but it was later withdrawn, as reported. A new report was then submitted by the Chair of the Municipal Council, Tanya Zaharieva, and it was the one voted during the August 16 session. However, there are no amounts and items in it. It is only noted that the municipal councilors “consent to the signing of annexes to the contracts by the Mayor and the payment of unforeseen expenses in connection with the execution of construction contracts under the project …, the necessary funds being included in the capital expenditure estimate in the budget of the Haskovo municipality for 2018”.

No subcontractors are allowed, but there are subcontractors

There are companies that have won contracts for the rehabilitation of the educational infrastructure that have deemed the awarded money to be sufficient. But they are very intriguing. In the “Elhitsa” kindergarten in the ideal city center our team found a total of five workers. Two of them stood on the scaffolding outside and chatted. Dressed in some of their own clothes, not work ones, without protective attributes, which is a topic for the respective control institutions, the men said they were from Eco Tradex Group. This company is not on the list of winning bidders for school and kindergarten repairs in Haskovo for this season, but it is the one that is in the top three for the entire country dealing with rehabilitation and owned by Dobrev’s relative, Daniel Gargov.

Delyan Dobrev is among the noisiest supporters of GERB’s national energy efficiency program for multi-family buildings. According to the contract for the repair of the “Elhitsa” kindergarten, Eco Tradex Group has nothing to do there, however, its workers are slowly progressing towards the finish line. According to the technical manager, Hristo Stoyanov, the people working at the site were from the company CT Cleaner which is not among the winning bidders as well. To the question whether this company is a subcontractor for some of the works, the answer was a firm no. This order has been awarded to EE Engineering for close to BGN 2 million.

Relative of Bulgarian MP Repairs Buildings with EU Funds in Breach of OPRD ContractRelative of Bulgarian MP Repairs Buildings with EU Funds in Breach of OPRD ContractRelative of Bulgarian MP Repairs Buildings with EU Funds in Breach of OPRD Contract

Only workers at the “Shturche” kindergarten admitted being subcontractors. The men in question were engaged in the renovation of the electrical installations, while the builders of the winning company ATA-GERT were lying in the courtyard. They assured us that everything will be done by the deadline of September 20 – something that seems quite doubtful because of the appearance of the site with excavations all over and piles of junk. Or, “one wing may remain to be completed in the presence of the children, but that would not hinder the learning process in any way,” according to the forecast of one of the resting men.

Relative of Bulgarian MP Repairs Buildings with EU Funds in Breach of OPRD ContractRelative of Bulgarian MP Repairs Buildings with EU Funds in Breach of OPRD Contract

And a company linked to DPS

In the wider part of the courtyard, there was one sole idle Ata-Gert excavator with its windshield displaying a sign with the name of the contractor of the site. On the fence of the kindergarten there was a larger one with details, revealing that the repairs with European money are the work of Ayshe Ataman, the wife of the former DPS MP and regional leader of the party in Haskovo, Mehmet Ataman and she represents the company ATA-STORY, working together with the Plovdiv-based GERT GROUP of Tundzay Guyler.

At the end of December 2016, the company of Ayshe Ataman emerged the only bidder in the public procurement for snow removal and winter maintenance of roads and streets in the municipality of Haskovo, and later performed very poorly against BGN 320,000. In January 2017, Mehmet Ataman’s declaration to the National Audit Office revealed the newest family acquisitions – two apartments – of 109 square meters in Haskovo and of 106 square meters in Sofia, two garages, two land plots of 1,474 square meters each, four meadows in the village of Nikolovo and three in the village of Chernoochene. The two automobiles – an Opel Corsa and a Mercedes – are registered to the wife, Ayshe.

Due to the lack of a technical representative of the company Ata – Gert at the site of the “Shtourche” kindergarten we were unable to find out whether there were unplanned construction works there as well. According to the explanations of Deputy Mayor Konsulov, during excavations around one kindergarten, it was found that the pipeline of the fire-fighting installation was compromised, which the contractor had no way of knowing, while an identical problem appeared in another building. All this implies requests for additional cash installments.


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