Bewitched and robbed City of Irkutsk Ice Stadium may transform into Ice Hall
Irkutsk residents have been waiting for an Ice Stadium to open for the last 15 years. The local Government promised to solve the issue by the end October. It is November now; the stadium is yet to be commissioned. Why did the city get some dubious construction instead of reliable and spacious Ice Stadium after having spent more than 1 billion rubles of public funds?
Irkutsk has been building its Ice Stadium since turn of the century. It should have become a multi-purpose sports hall with synthetic ice and grandstand able to accommodate 3,000 people. Sergey Ogorodnikov, the coach for Olimpiya, an Irkutsk junior hockey team, was the one who initiated the construction in 2000. Vyacheslav Fetisov, the Head of the Federal Agency for Physical Education and Sports of the Russian Federation at the time, supported the idea. The legendary hockey player claimed Moscow is ready to provide a part of the necessary funding. The Irkutsk Town Hall then proceeded to provide 30% of the money needed. The project took off pretty decisively; walls and steelwork were erected in just a year. However, the Town Hall stopped allocating money almost completely not long after. The Administration explained it with lack of budgetary funds. Public officers decided on waiting for federal funding. It was only possible if the General Board of State Expert Review of the Russian Federation gave its approval. The city had to wait for a year, suspending the project. However, nothing changed once after it got it. The construction site was abandoned and left to rust out in the open due to lack of funding in 2004.
The Irkutsk Administration proposed transferring the right of ownership for the incomplete construction to the region in mid-2000. The Irkutsk Region Ministry of Property Relations obtained the right in 2007. The project required 159 million rubles more to complete, according to its delivery and acceptance certificate.
However, the project changing hands made no difference whatsoever. The situation was so bad it was decided to demolish the construction and build another sports and entertainment facility in 2009.
Many Irkutsk Region governors intended on completing the project. Dmitry Mezentsev, the Governor, committed to doing so in 2011, when the city celebrated its anniversary. The Irkutsk Region Department for Permanent Construction was the customer. The Stadium was ceremonially opened in December of the same year. The Governor, the Mayor and other officials attended the event featuring a hockey match and ice show. However, the Stadium was later closed for further development. There was a need for installation of ventilation and sewage systems, electrical engineering adjustment, and refurbishment, according to official reports. However, there was the need to reinforce rusting metalwork so the building did not collapse, according to unofficial reports. The IrkutskPromStroy Construction Company, the initial project main contractor, was the first to offer undertaking the works, according to the CrimeRussia source. However, the CEO of the reputable company refused to implement the project; he understood the framings corroded too much to pass any safety inspection. That is when Spetsstroy-7 Construction Company, a fly-by-night Moscow company, stepped in. Irkutsk residents doubted intentions of the company proposed by Sergey Eroshchenko, the Irkutsk Region Governor at the time, right away. They soon turned out to had been right about it, when the company’s legal address (the Raduzhny micro-district) was found to coincide with that of the Istlend JSC controlled by the Governor. The Irkutsk residents came to the following conclusion right away: the money allocated for the project completion would be stolen; the city would still be left without a new stadium. They were going to see they had been right.
Sergey Eroshchenko, the former Irkutsk Region Governor
A 2013 court commission canceled the contract with Spetsstroy-7 due to breach of obligations, since deadlines were not met and works were not completed. The Investigative Department of the Investigative Committee of the Russian Federation in the Irkutsk Region opened a criminal case on the allegation of misappropriation of funds during the Ice Stadium construction in December 2013, following numerous articles and public outcries. The investigation took more than 1.5 years. Andrey Bunev, the Head of the Department, claimed it took so long due to enormous number of expert examinations they had to carry out in both Irkutsk and Moscow. The cost of the construction works amounted to 738 million rubles, while 162 million rubles were misappropriated, according to results of all the examinations. Neither the experts nor the investigators discovered any other instances of misappropriation.
Pavel Tayursky, the Head of the Irkutsk Region Department for Permanent Construction at the time, was accused of breaking the Article 286, part 1 of the Criminal Code of the Russian Federation (Exceeding Official Powers) in November 2014. The accused entered into an amendment agreement with Spetsstroy-7, according to the investigators. The customer agreed to pay the contractor an advance amounting to 30% of works carried out over a year, according to the amendment. The advance was transferred to the contractor despite the initial agreement not providing for that. Spetsstroy-7 spent 550 million rubles carrying out works from January 2011 to October 2012; the customer transferred it 690 million rubles, including the advance, over the same period. This means 140 million rubles of budgetary funds were paid for no reason and spent by Spetsstroy-7 as it saw fit. It is worth mentioning that 140 million rubles is about 20% of the agreement sum, which constitutes the standard amount of a cut. It is yet to be known whether Sergey Eroshchenko, the man who lobbied the venture, got hold of some of the money.
Pavel Tayursky, the former Head of the Irkutsk Region Department for Permanent Construction
The Kuybishvsky Court of Irkutsk found Pavel Tayursky guilty and sentenced him to 4 years in medium-security prison February 2016. A criminal case was also opened against Maksim Kovpak, the Spetsstoy-7 CEO, August 2014, for the company did not carry out any construction activities despite having received budgetary funds for doing so. He was accused of breaking part 3 of Art. 159.4 and part 2 of Art. 327 of the Criminal Code of the Russian Federation (Swindling in Business Area Committed on an Especially Large Scale). The Spetsstroy-7 CEO intentionally misappropriated the Irkutsk Region budgetary funds by, among other things, forging work acceptance certificates and information sheets on costs of works performed and expenses, according to the investigators. Moreover, the contractor did not deliver all the obligations it undertook in regard to the Stadium construction. The case is under court consideration. Maksim Kovpak does not admit his guilt.
Maksim Kovpak, the former Spetsstoy-7 CEO
The Fizkulturno-Sportivnaya Organizatsiya Aleks LLC Sports Company became the new contractor for the project Irkutsk residents had nicknamed the Misfortunate Stadium. It entered into a concessionary agreement as the results of a bidding. The company agreed to complete the project at its own expense; the region kept the right of ownership but agreed to temporary transfer it to the concessioner for the next 20 years. The project was 92% complete at this point. “We were the only company to participate in bidding for the project. My friends tried to persuade me against entering into the agreement, saying everyone believes the Stadium to be bewitched,” Aleksandr Bikov, the company CEO, admitted in an interview to a local media outlet.
The concessioner completed the project, spending 40 million rubles more. The long-awaited Stadium was finally opened October 2015, hosting various sports clubs. However, the Stadium operated for only a month. The Irkutsk Region Ministry of Property Relation, the Stadium owner, refused to sign the commissioning sheet when in October 2015, when it was the time to do so. It stated the Department for State Construction Supervision of the Russian Federation declared the Stadium to be dangerous after having carried out an inspection. They questioned reliability of grids, ventilation, fire extinguisher, and fire prevention systems. But the main thing was that fire safety rules changed over the time of the Misfortunate Stadium construction; the Stadium did not comply with them anymore. Two documents were signed into power in 2009: new edition of the Public buildings and facilities and Fire safety provision. Public stadiums capable of accommodating more than 800 people need to comply with the 1st degree fire-resistance requirements now, while the project was designed to comply with the 2nd. Thus, only 800 people can safely attend the Stadium meant for 3 000 spectators. Moreover, no one knew how reliable the framings were. One needs to carry out an inspection involving special equipment to find out. That is why the Irkutsk Region Ministry of Property Relations filed a lawsuit to court of arbitration. The Stadium was closed until the lawsuit is settled. “We will not allow operating the Stadium until we are sure it is safe,” Ruslan Bolotov, the Irkutsk Region spokesperson, said.
The concessioner evaluated fire risks in order for the Stadium to be allowed to accommodate up to 3 000 people. The court ordered the Open Trans-Regional Center for Law and Legal Expertise of the Irkutsk National R&D Engineering University to carry out a comprehensive construction&engineering examination of the Stadium February 2016. The Center experts found the Stadium to be safe provided it does not accommodate more than 800 people. The Irkutsk Region Ministry of Property Relations addressed the Ministry of Construction Industry, Housing and Utilities Sector, asking it to carry out yet another examination. The Irkutsk Region Ministry of Property Relations will allow the Stadium operation only if court finds the Aleks LLC to be right. The case has been under consideration for a year.
Sergey Levchenko, the Irkutsk Region Governor, claimed he is going to make sure the people who are guilty for all these are brought to account. However, it is not that simple; contractors responsible for the better part of the construction activities have long been declared bankrupts.
In September of this year, Vladislav Sukhurchenko, the Priangarie Property Relations Minister, promised the Irkutsk Court of Arbitration will pass its judgment on the case October 2016. 3 court hearings took place in October, but none of them resulted in a ruling. The last one, held October 28, ended up with the court ordering yet another fire safety examination of the Stadium. No one knows when the long-drawn case ends.
1 billion 80 million rubles (140 million of which were misappropriated) were spent on the Stadium over the years, according to estimations of the Priangarie Ministries of Construction and Housing and Public Utilities. However, the region residents did not get anything from it. They would be promised a Stadium year after year, but ended up getting promises of it being completed in the near future every time instead. They are done with that now and are ready to train in the Stadium even despite it not being commissioned yet, since there are no other ice rinks in the city. Five children’s hockey clubs already train there despite neither coaches nor parents being satisfied with the conditions. The Aleks LLC charges the parents mercilessly for their children being able to train in an incomplete Stadium with questionable safety. “Nothing will collapse here. The only thing left is decoration works; we are whiting ceilings and painting walls. What danger are you talking about?” a company spokesperson said self-assertively in view of a scandal around illicit Stadium operation.
Only children practice in the building without acceptance certificate. Professional athletes have to go to the nearby City of Angarsk to train, just like 15 years ago. They hope to get at least an Ice Hall for 800 people, having given up on dreaming of a Stadium for 3 000 spectators.
The State Duma member is not happy about the fact that the budget surpluses that rolled in as a result of additional income following the oil and gas sales are being forwarded to the Russian National Wealth Fund.