Earthquake Law: 60 Percent of Reconstruction to be Funded by the Government, the Rest by Owners and Local Units

The law stipulates that the financing of the structural reconstruction of buildings will follow a model where 60 percent is financed by the Government, 20 percent by local self-government units, and 20 percent by owners, said Prime Minister Andrej Plenković while presenting the proposal for the law on the reconstruction of buildings damaged by the earthquake in the City of Zagreb, Krapina-Zagorje County, and Zagreb County.

A reconstruction fund will also be established, which will not only be responsible for the implementation of the reconstruction but will also be tasked with raising funds for the reconstruction and represent a ‘one stop shop’ for all information for citizens affected by the earthquake, announced Plenković.

He reminded that so far, through the budget rebalancing and funds from the Environmental Protection Fund 100 million kuna has been secured for emergency repairs, 41 million kuna has been allocated from the Fund for condensing boilers, and the cost of housing for citizens affected by the earthquake in the Cvjetno Student Dormitory has been taken over by the Government. A loan of 200 million dollars has been agreed with the World Bank, and discussions are ongoing with the Council of Europe Development Bank regarding a loan, and a request has been submitted for the European Solidarity Fund, said the Prime Minister.

Estimated damage from the earthquake is 11.5 billion euros

– The estimated damage from the earthquake is around 11.5 billion euros, and the number of damaged buildings is 25,000, the scale of the earthquake is significant, ten seconds of the earthquake will undoubtedly bring 10 years of work – emphasized the Prime Minister.

The law should ensure the fundamental principles of organized reconstruction according to all professional rules so that the historical and artistic value of Zagreb is preserved. All interested stakeholders, builders, architects, art historians, conservators, and others were consulted in its drafting, and it underwent public consultation during which around 400 comments were received, some of which were incorporated into the proposal for the law. Plenković stated that he wants to achieve as broad a consensus as possible on the law, and that the legal framework should be clear, transparent, and enforceable.

Minister of Construction and Spatial Planning Darko Horvat stated that the reconstruction will be a significant financial challenge but that the majority of the costs will be borne by the state. A detailed program of measures will be developed that will specify the activities and dynamics of the reconstruction depending on the sources of financing. Regarding public buildings, Horvat announced that their reconstruction will be fully financed by the founder’s funds.

Minister of Culture and Media Nina Obuljen Koržinek added that the reconstruction will take into account the application of the most modern technologies to enhance the value of the Zagreb fund and preserve cultural and historical values.

Minister of Finance Zdravko Marić expressed hope that the reconstruction will also contribute to economic activity in Croatia.

The Croatian Parliament will discuss the law on the reconstruction of Zagreb next week.

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