Circular No. 174/2009/TT-BTC guides the mechanism for mobilizing and managing various sources of capital at 11 communes implementing the Pilot Program on Building a New Rural Model during the Period of Industrialization and Modernization.

CIRCULAR

Guidelines for mechanisms to mobilize and manage various sources of capital in 11 communes implementing thePilot Program "Rural Development Model Construction Program during the Period of Industrialization and Modernization"industrialization and modernization”

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Pursuant to Resolution No. 26-NQ/TW dated August 5, 2008 of the 7th Plenary Session of the 10th Central Committee of the Communist Party of Vietnam on agriculture, farmers, and rural areas;

Pursuant to Resolution No. 24/2008/NQ-CP dated October 28, 2008 of the Government promulgating the action program of the Government to implement the Resolution of the 7th Plenary Session of the 10th Central Committee of the Communist Party of Vietnam on agriculture, farmers, and rural areas;

Pursuant to the Decree No. 118/2008/NĐ-CP dated November 27, 2008 of the Government stipulating the functions, tasks, powers, and organizational structure of the Ministry of Finance;

Implementing Circular No. 7032-CV/VPTW dated April 8, 2009 of the Office of the Central Committee of the Communist Party of Vietnam on the Pilot Program for Rural Development Model Construction; the Ministry of Finance issues guidelines for mechanisms to mobilize and manage various sources of capital to implement the Pilot Program "Rural Development Model Construction Program during the Period of Industrialization and Modernization" as follows:

Part I
GENERAL PROVISIONS

Article 1. This Circular applies to planning projects; investment construction projects for socio-economic infrastructure; development projects for "one product per village"; training programs for building new rural areas for grassroots cadres, village cadres, cooperative cadres, and farm owners in the 11 pilot communes under the Pilot Program "Rural Development Model Construction Program during the Period of Industrialization and Modernization" (hereinafter referred to as the Program).

The resources to organize the implementation of the Program include central budget funds; local budget funds; revenues from land auction sales according to the Land Law; government bond funds; state investment credit development funds; enterprise investment funds; human resources and labor days of the people and community in the commune to build the "Rural Development Model Construction Program during the Period of Industrialization and Modernization". The management of funds shall be carried out as follows:

1. For objects where state budget support accounts for 50% or more of the capital, this Circular shall apply.

2. For objects where state budget support accounts for less than 50% of the capital, the management of funds shall be carried out through mutual agreement between the community and the Commune New Rural Area Construction Management Board.

3. For objects invested by enterprises: enterprises investing in these fields shall comply with current laws.

Article 2. The Chairman of the People's Committee of the commune ensures the direction of the management and use of funds in accordance with their intended purpose, economy, efficiency, democracy, transparency, and compliance with state financial management, investment, and construction regulations and the provisions of this Circular.

Article 3. The Commune New Rural Area Construction Management Board, assigned as the main investor, shall manage the funds in accordance with current state regulations and the provisions of this Circular.

Article 4. Financial agencies at all levels, investment and construction project management agencies at higher levels according to their assigned functions and tasks, have the responsibility to guide the Commune New Rural Area Construction Management Board to organize the implementation of investment projects. The State Treasury Agency has the responsibility to guide the supervision and timely payment of funds for investment projects in accordance with this Circular.

Part II
MECHANISM FOR CAPITAL MOBILIZATION

Article 5. Principles for Mobilizing and Sources of Capital to Implement the Project:

1. Principles for Mobilizing Capital to Implement the Project:

a) Local Resources to Organize and Implement the Project:

- Mobilize the maximum local resources (province, district, commune) to organize and implement the project; specifically, the revenue from land auctions for allocating land with land use fees or leasing land within the commune (after deducting costs) should be reported by the People's Committee of the province or centrally governed city to the People's Council at the same level for consideration and decision to allocate 100% to the commune budget, thereby creating capital for implementing the project (but not exceeding the approved content of the project by the competent authority).

- Mobilize the people's strength (labor and materials) voluntarily and actively to build their rural areas (with the principle that the State and the people work together).

b) Mobilize investment capital from enterprises for projects capable of directly recovering funds; enterprises can borrow development investment credit from the State or centrally governed cities can receive state budget support after investment (if borrowing from commercial banks to implement projects) and enjoy investment incentives as prescribed by law.

c) Ministries, sectors, and People's Committees of provinces and centrally governed cities must prioritize the allocation of capital and integrate various sources of capital from central target programs for projects and programs in communes implementing the project.

2. Sources of Capital to Implement the Project Include:

a) State Budget, Including:

- Central and local budgets (including provincial, district, and commune budgets) allocated in annual state budget estimates, including integrated capital from national target programs (including: poverty reduction program; national employment program; clean water and environmental sanitation program in rural areas; crime prevention program; population and family planning program; social disease prevention program, dangerous diseases, and HIV/AIDS; culture program; education and training program; Program 135; new forest planting project of 5 million hectares); while prioritizing supplementary targeted capital from the central budget for local budgets (including: supporting investment in commune headquarters; supporting the division of counties and communes; supporting medical care for the poor; supporting medical care for children under six years old...) and capital allocated for projects not included in national target programs as reflected in the approved project.

b) Government Bond Capital (if applicable): for investing in road projects to commune centers without motor vehicle access (as listed in Decision No. 171/2006/QD-TTg dated July 24, 2006 of the Prime Minister on the issuance and use of government bonds during the period 2003-2010 and subsequent supplementary decisions of the Prime Minister); investing in projects to reinforce school buildings (as stipulated in Decision No. 20/2008/QD-TTg dated February 1, 2008 of the Prime Minister approving the Reinforcement of School Buildings and Housing for Teachers Project).

c) State Development Investment Credit Capital allocated by the central government to provinces and centrally governed cities for the program of reinforcing irrigation channels, developing rural roads, infrastructure for aquaculture, and village craft infrastructure in rural areas during the period 2009-2015 (hereinafter referred to as state development investment credit capital) according to Decision No. 13/2009/QD-TTg dated January 21, 2009 of the Prime Minister on the use of state development investment credit capital to continue implementing the programs of reinforcing irrigation channels, developing rural roads, infrastructure for aquaculture, and village craft infrastructure in rural areas during the period 2009-2015; Decision No. 56/2009/QD-TTg dated April 15, 2009 of the Prime Minister amending and supplementing certain provisions of Decision No. 13/2009/QD-TTg dated January 21, 2009 of the Prime Minister on the use of state development investment credit capital to continue implementing the programs of reinforcing irrigation channels, developing rural roads, infrastructure for aquaculture, and village craft infrastructure in rural areas during the period 2009-2015 and other amending and supplementing decisions (if any).

d) Enterprise Investment Capital: for investing in power systems sufficient to meet production needs, postal services, and clean water for daily use.

đ) Voluntary Contributions from the People in the Commune for Specific Investment Projects, Approved by the Commune People's Council and Included in the Commune Budget Revenue.

e) Mobilization from the Community (voluntary contributions and non-repayable aid from domestic and foreign businesses, organizations, and individuals for investment projects). These contributions are implemented as follows:

- In the case of monetary contributions: The Commune People's Committee collects and deposits into the account for investment capital managed by the commune at the State Treasury.

- In the case of in-kind contributions: Implemented according to the guidelines set out in Circular No. 75/2008/TT-BTC dated August 28, 2008 of the Ministry of Finance on managing investment capital from commune, town, and township budgets (hereinafter referred to as Circular No. 75/2008/TT-BTC dated August 28, 2008 of the Ministry of Finance).

f) Other Legal Financial Sources.

Article 6. Objectives and Levels of Support:

1. Recipients of Support:

a) Objectives (projects) supported by 100% central budget include: costs for planning work; roads to commune centers; construction of commune headquarters; construction of standard schools; construction of commune health stations; construction of commune cultural houses; clean and hygienic water supply systems; funding for training knowledge about新农村建设的干部、村民小组干部、合作社干部和农场主。21 ||| The level of central budget support is based on the total investment amount or the approved budget estimate; when established, it must comply with the regulations of the competent authority such as technical standards, design, quotas, unit prices (road grade, commune headquarters standards, school standards, health station standards...) and the state training expense system.

The level of support from the central budget is based on the total investment amount or approved budget estimate; when established, it must comply with the regulations of the competent authority such as technical standards, designs, norms, unit prices (for roads, communal headquarters standards, school standards, health stations...), and the state's training expenditure regime.

b) For the remaining subjects, based on economic and social conditions, as well as natural conditions of each region; the central budget will support a portion from the targeted supplementary source to implement the Project; the remainder will be supported by the local budget, invested by enterprises, contributed by the people, and mobilized from the community.

2. Level of support:

a) The level of support from the central budget for each locality for the entire Project shall be implemented according to the Decision of the Prime Minister.

b) The level of support for each subject (project) specifically (as stipulated in Point b, Clause 1, Article 6) shall be prescribed by the People's Committee of the province or centrally governed city, ensuring that the amount of support from the central budget does not exceed 70% of the total cost of implementing each subject (project) of the Project.

Part III
MANAGEMENT AND SUPERVISION MECHANISMS FOR FUNDS

Article 7. Develop plans and announce fund plans.

1. Develop fund plans:

- Based on the new rural development project of the commune approved by the Central Steering Committee for the Pilot New Rural Development Program (hereinafter referred to as the Central Steering Committee), the Provincial Steering Committee for the Pilot New Rural Development Program (hereinafter referred to as the Provincial Steering Committee) shall organize the approval of the project as the basis for implementation; the People's Committee of the commune and the Commune Management Board for New Rural Development shall organize propaganda and dissemination to the people in the investment area to discuss democratically and publicly select priority projects for investment. Based on the opinions of the people, national construction standards, and the advice of specialized staff, the People's Committee of the commune shall develop the commune's fund plan for three years (2009-2011) and send it to the Central Steering Committee, relevant Ministries, and the Provincial Steering Committee for monitoring and management (according to Model No. 01/BC-KHĐT attached).

- Based on the opinions of the Central Steering Committee, the Provincial Steering Committee shall direct relevant provincial agencies and the Commune Management Board for New Rural Development to establish investment projects in accordance with the specified standards and norms set by the competent authority (road, school, commune office, health station, etc.) to determine the funding level for each project and send it to the Central Steering Committee to determine the level of funding support.

2. Announce fund plans:

Based on the funds provided by higher-level budgets (including the central budget, provincial budget, and district budget), the commune budget's capacity, and the funds raised through contributions, and based on the volume of work of the investment projects, the Commune Management Board for New Rural Development shall propose a plan to report to the Chairman of the People's Committee of the commune for decision-making and announcement of the fund plan, while sending it to the State Treasury (where the account is opened) as the basis for transferring funds and payment.

Article 8. Advance payments and fund settlement.

1. Open accounts:

- The Commune Management Board for New Rural Development may open an account for capital investment under the commune's management at the State Treasury (where the commune's budget transaction account is opened) as the transaction account.

- The Commune Management Board for New Rural Development may use the seal of the People's Committee of the commune to conduct transactions at the State Treasury.

- The State Treasury shall guide the Commune Management Board for New Rural Development in opening the transaction account and separately tracking and recording this account.

2. Capital disbursement mechanism:

a) For targeted supplementary funds from the central budget to support the commune budget through the local budget, it shall be carried out as follows: based on the document of the Ministry of Finance regarding the provision of targeted supplementary funds from the central budget to implement projects and tasks for the commune; the Department of Finance shall withdraw the budget estimate according to current regulations, and simultaneously notify the commune of the supplementary amount through the district.

b) For targeted supplementary funds from the provincial and district budgets to support the commune budget:

- Based on the document of the Department of Finance regarding the provision of targeted supplementary funds from the provincial budget to the district budget (down to the commune level) to implement projects and tasks for the commune; the District Financial Planning Office shall withdraw the budget estimate according to current regulations, and simultaneously promptly notify the commune of the targeted supplementary funds from the district budget to support the commune budget as stipulated.

- Based on the notification document regarding the provision of targeted supplementary funds from the district budget to the commune budget to implement projects and tasks for the commune; the commune financial agency shall handle the withdrawal of the budget estimate according to current regulations. At the same time, temporarily advance the commune budget to transfer into the commune-managed capital investment deposit account at the State Treasury where the transaction takes place.

c) For other sources of funds: based on the fund plan announced by the Chairman of the People's Committee of the commune, the proposal of the Commune Management Board for New Rural Development, and the actual received funds; the State Treasury shall transfer the entire investment capital according to the proposal into the commune-managed capital investment deposit account.

The Commune Management Board for New Rural Development has the responsibility to receive funds, proactively decide on income and expenditure according to the approved objectives; regularly report monthly to the public for their knowledge and supervision.

3. Project documentation, advance payment levels, recovery of advance payments, and settlement of completed volumes:

a) For planning projects: implemented according to Circular No. 24/2008/TT-BTC dated March 14, 2008, of the Ministry of Finance guiding the management, use, and final settlement of state economic service fees for implementing planning tasks and projects.

b) For construction investment projects:

- Implemented according to Circular No. 75/2008/TT-BTC dated August 28, 2008, of the Ministry of Finance.

- Specifically, for the package of works undertaken by villagers within the commune, the maximum advance payment is 80% of the contract value and does not exceed the annual fund plan for the package.

c) For training contents on new rural development for grassroots cadres, village cadres, cooperative cadres, farm owners, and projects developing "one product per village": implemented according to Joint Circular No. 01/2008/TTLT-UBDT-KHĐT-TC-XD-NNPTNT dated September 15, 2008, of the Joint Circular of the Committee for Ethnic Minorities, the Ministry of Planning and Investment, the Ministry of Finance, the Ministry of Construction, and the Ministry of Agriculture and Rural Development guiding the implementation of the socio-economic development program for particularly difficult communes in ethnic minority and mountainous areas for the period 2006-2010.

d) The Rural New Countryside Construction Management Board when transacting with the State Treasury may use accounting forms and vouchers issued pursuant to Decision No. 120/2008/QĐ-BTC dated December 22, 2008 of the Minister of Finance on the "Regime of State Budget Accounting and Treasury Business Operations."

4. The State Treasury shall implement control and payment as follows:

- The State Treasury shall implement control and payment according to the principle of paying first and then controlling for each payment, and controlling first and then paying for the final payment of the work, tender package, or contract. Based on this principle, the State Treasury shall provide specific guidance to ensure uniformity within the system.

- On the basis of the payment request form (or advance payment) sent by the Rural New Countryside Construction Management Board, referring to the contract (or approved budget estimate for works carried out without contracts), the State Treasury shall make payments (or advance payments) to the Rural New Countryside Construction Management Board and, at the request of the Rural New Countryside Construction Management Board, make payments (or advance payments) to contractors and related units; simultaneously recover advance payments (if any) in accordance with regulations.

The State Treasury shall base its payments to the Rural New Countryside Construction Management Board on the capital plan, payment documents, payment terms stipulated in the contract (number of payments, payment stages, payment time points, and payment conditions) and the value of each payment. The Rural New Countryside Construction Management Board is responsible for the accuracy and legality of the volume of work performed, standards, unit prices, various types of budget estimates, quality of projects. The State Treasury is not responsible for these issues.

5. The amount of payment from the account of investment capital managed by the commune in a year (including advance payments and payments for completed volumes) shall not exceed the amount transferred into this account.

6. The amount of payment for each item of work, project component shall not exceed the approved budget estimate or tender package price; the total amount of payment for the investment project shall not exceed the approved total investment ceiling.

Article 9. Settlement.

1. All investment projects, upon completion and handover for use, must be approved for settlement of completed projects. The decision approving the settlement of completed projects must be publicly posted at the Commune People's Committee Office and sent to relevant agencies and units.

2. For investment projects using state budget support funds, before approval of settlement, confirmation from the Head of the Commune Construction Supervision Board is required.

3. Guidance on settlement:

a) For planning projects: implemented according to Circular No. 24/2008/TT-BTC dated March 14, 2008, of the Ministry of Finance guiding the management, use, and final settlement of state economic service fees for implementing planning tasks and projects.

b) For construction investment projects: follow Circular No. 75/2008/TT-BTC dated August 28, 2008 of the Ministry of Finance. Specifically, the settlement forms (Form No. 01/QTDA and Form No. 02/QTDA) must include confirmation from the Head of the Commune Construction Supervision Board.

c) For training contents on rural new countryside development for grassroots cadres, village cadres, cooperative cadres, farmstead owners, and product development projects: follow Joint Circular No. 01/2008/TTLT-UBDT-KHĐT-TC-XD-NNPTNT dated September 15, 2008 of the Joint Circular of the National Ethnic Council, the Ministry of Planning and Investment, the Ministry of Finance, the Ministry of Construction, and the Ministry of Agriculture and Rural Development.

Article 10. Community supervision.

1. Communes implementing the Program must establish a Community Investment Supervision Board in accordance with the guidance provided in Circular No. 75/2008/TT-BTC dated August 28, 2008 of the Ministry of Finance.

2. In addition to community supervision by the Community Investment Supervision Board, communes implementing the Program must establish a Commune Construction Supervision Board to oversee the implementation of the new countryside development program in their area.

- The Commune Construction Supervision Board has a maximum of nine members; members of the Commune Construction Supervision Board are representatives elected by the local people (where the investment targets are located) through discussion; the Head of the Commune Construction Supervision Board is elected by the members of the Commune Construction Supervision Board and approved in writing by the Chairman of the Commune People's Committee.

- The Commune Construction Supervision Board is allocated a budget of VND 10 million per year for operations. This funding is sourced from the central government's targeted support fund (as per Clause 1, Article 6).

Article 11. Reporting and inspection regime.

1. Reporting System:

- Quarterly and annually, the Commune People's Committee prepares reports on the implementation of the volume and paid investment capital (using Model No. 02/BC-THKH attached); sends them to the Provincial Steering Committee and relevant agencies and units. Quarterly reports are submitted before the 10th day of the first month of the next quarter, annual reports are submitted before January 15 of the following year.

- The Provincial Steering Committee is responsible for preparing comprehensive reports to send to the Central Steering Committee, relevant ministries and sectors, and recommending solutions to address existing issues (using Model No. 03/BC-THKH attached). Quarterly reports are submitted before the 15th day of the first month of the next quarter, annual reports are submitted before January 20 of the following year.

2. Inspection: regularly or unexpectedly, the Provincial Steering Committee directly organizes inspections, supervision, and evaluations of investment projects regarding the use of capital, progress of project implementation, and compliance with national financial policies and investment construction regimes.

Article 12. Responsibilities and authorities of relevant agencies.

1. The Provincial Steering Committee for Rural New Countryside Construction; the Commune People's Committee: implement responsibilities assigned in the Program "Pilot Model for New Countryside Construction during Industrialization and Modernization Period."

2. The Commune Construction Supervision Board:

- Participate in signing the acceptance certificate to confirm that the project has been constructed in accordance with design specifications, construction standards, and quality requirements; have the right to refuse to sign the acceptance certificate if the project does not meet quality requirements. Have the right to retain their opinions on the supervision tasks they undertake;

- Have the right to require contractors to construct in accordance with the contract;

- Are responsible for confirming data in settlement forms for investment projects using state budget support funds.

3. The Rural New Construction Management Board of the commune (as the investor); the Financial and Planning Department of the district; the Community Investment Supervision Board; contractors; State Treasury: shall perform their responsibilities in accordance with Circular No. 75/2008/TT-BTC dated August 28, 2008, issued by the Ministry of Finance.

Part IV
IMPLEMENTING PROVISIONS

Article 13. This Circular takes effect from the date of signature. During implementation, if there are arising issues or difficulties, agencies and organizations shall report to the Ministry of Finance for timely supplementation and amendment.