Joint Circular No. 666/2001/TTLT/BKH-UBDTMN-TC-XD guides the management of investment and construction of infrastructure projects under Program 135.

JOINT CIRCULAR

Guidelines for managing investment and construction of infrastructure projects under Program 135 

Pursuant to Decision No. 135/1998/QÐ-TTg dated July 31, 1998 of the Prime Minister approving the Program on Socio-Economic Development of Particularly Difficult Communes in Mountainous Areas and Remote Areas; Decision No. 138/2000/QÐ-TTg dated November 29, 2000 of the Prime Minister merging the settlement project, the special ethnic minority support project, and the mountainous commune center construction program into the socio-economic development program for particularly difficult communes in mountainous areas and remote areas (hereinafter referred to as Program 135) and other related decisions; the joint ministries of Planning and Investment, National Committee for Ethnic Minorities and Mountainous Regions, Finance, and Construction hereby issue guidelines for the management mechanism of investment and construction of infrastructure projects in communes under Program 135 as follows:

I. GENERAL PRINCIPLES:

1. These Circulars apply to the management of investment and construction of infrastructure projects in communes under Program 135 as per Decision No. 138/2000/QÐ-TTg dated November 29, 2000; Decision No. 1232/1999/QÐ-TTg dated December 24, 1999; Decision No. 647/2000/QÐ-TTg dated July 22, 2000; Decision No. 42/2001/QÐ-TTg dated March 26, 2001 of the Prime Minister; the Commune Center Construction Project (TTCX) as per Decision No. 35/TTg dated January 13, 1997 and Decision No. 197/1999/QÐ-TTg dated September 30, 1999 of the Prime Minister.

2. These Circulars guide the management mechanism for investment and construction of small-scale infrastructure projects with a capital investment of up to one billion dong, which shall be implemented under a special mechanism to suit the actual capabilities of cadres and ethnic minorities in localities under Program 135.

Large-scale projects with a total investment exceeding one billion dong shall be carried out in accordance with Decree No. 52/1999/NÐ-CP dated July 8, 1999 and Decree No. 12/2000/NÐ-CP dated May 5, 2000 of the Government.

3. Program 135 is funded from multiple sources, the People's Committee of the province has the responsibility to organize the mobilization of resources at the local level, including capital, materials, and labor contributed by various sectors, levels, economic agencies, social organizations, and all strata of the population within the province to support the investment and construction of infrastructure projects, while integrating other programs and projects with Program 135 in the communes covered by the program.

4. All sources of funds must be included in the plan for unified management, announced to each commune, made public to the people, invested according to purpose and target, ensuring quality, preventing loss, and simultaneously mobilizing the maximum resources of the people in the commune under Program 135, linking the interests, responsibilities, and sentiments of the local people to the effective long-term investment, exploitation, and utilization of the projects.

5. The allocation of state budget funds, including central (TW) and local (DP) support annually, must ensure that all communes under Program 135 are invested in, but not equally distributed, based on the urgent needs of the projects and the investment preparation capacity of each commune, and should be reasonably arranged. Projects listed in the plan should only be implemented within one year, at the latest not exceeding two years.

6. Investment in infrastructure construction in communes should achieve dual benefits: the commune has facilities to serve the people; the people have jobs and increased income from labor constructing communal facilities.

7. The selection of investment projects in the commune must be conducted openly and democratically, with the People's Council of the commune deciding on the list, scale, priority order of investment, and the ability to mobilize resources within the commune for construction.

II. INVESTMENT PLAN:

To ensure synchronized investment in line with immediate and long-term requirements, the investment plan for infrastructure projects in communes must be based on approved planning and projects.

The content of establishing, reviewing, and approving the commune's infrastructure project planning shall be carried out in accordance with the guidance of the National Committee for Ethnic Minorities and Mountainous Regions (Document No. 430 UBDTMN/BTK dated April 29, 1999); the investment project for Commune Centers (TTCX) shall be carried out in accordance with the guidance of the National Committee for Ethnic Minorities and Mountainous Regions.

A. Investment Project, Project Owner, Project Management Board, and Village Supervisory Board.

1. Investment Project:

a. Objectives of the investment project:

- The investment project for infrastructure in communes under Program 135 supported by the state includes road transportation, small irrigation works, water supply for daily use, electricity provision including small hydropower plants, schools, health clinics, markets, and land reclamation for rice fields and terraced fields where necessary.

Infrastructure construction projects under the settlement project that are integrated into the investment infrastructure project of communes under Program 135 must be adjusted to fit the content of the approved infrastructure construction project planning of the commune.

- Commune Center Project (TTCX Project): This is a project within Program 135 aimed at building economic exchange centers and cultural living centers for ethnic minorities in mountainous and highland areas, serving as a foundation for developing market towns in mountainous regions and among ethnic groups. The state supports the investment in TTCX projects such as roads, schools, multi-purpose clinics, agricultural extension stations, forestry extension stations, markets, water supply, electricity provision, and creating flat land for residents to build houses, shops, processing facilities, and organize service activities according to the approved planning.

b. Classification of projects:

- The investment infrastructure project in communes under Program 135 is divided into two types, depending on the specific conditions of each locality decided by the provincial People's Committee:

- Commune Center Project.

2. Project Owner:

- For county-managed projects, the People's Committee of the county is the project owner.

- For the Commune Center investment project, the People's Committee of the county is the project owner.

- For commune-managed projects, the People's Committee of the commune is the project owner.

The People's Committee of the district shall be responsible for integrating funds from other programs and projects within the district with Program 135 to allocate capital for each project in each commune according to the annual plan, ensuring that the availability of capital matches the investment progress of the project, avoiding equal distribution of funds among communes, actively adjusting capital between communes within the annual plan to ensure full utilization of funds and completion of projects according to approved schedules, while coordinating the investment in each commune with the investment in communal centers in a reasonable manner.

During the implementation process, depending on the scale and nature of specific projects, the district may delegate management and construction responsibilities for some simple projects to the communes. Construction of infrastructure projects must go hand in hand with training and enhancing the management capacity of commune officials to gradually transfer responsibility for project management to the communes.

3. Project Management Board: The project sponsor establishes a Project Management Board at the appropriate level:

- District-level Project Management Board: Comprises the head of the board and several specialized staff members. Depending on the specific circumstances of each locality, the existing Construction Project Management Board of the district can be utilized to implement the program.

The Project Management Board has legal personality, is entitled to open an account at the State Treasury of the district, and has its own seal. The head of the Project Management Board is proposed by the District People's Committee and appointed by the Provincial People's Committee.

The Chairperson of the People's Committee of each component commune is a member of the district-level Project Management Board.

- Commune-level Project Management Board: The head of the board is proposed by the Commune People's Committee and appointed by the District People's Committee; the commune-level Project Management Board is entitled to open an account at the State Treasury of the district and uses the seal of the Commune People's Committee for transactions.

- The Project Management Board assists the sponsor in performing the following tasks:

4. Commune Supervisory Board: The Provincial People's Committee guides on the functions, duties, and organizational structure of the Commune Supervisory Board; the District People's Committee directs its establishment.

B. Implementation Steps of the Investment Plan.

1. Preparation, Review, and Approval of the Investment Project:

- The investment project for infrastructure works in communes is prepared by a specialized unit with legal personality chosen by the sponsor; the Department of Planning and Investment leads the review in collaboration with the Department of Finance-Price, the Ethnic Minorities and Mountainous Areas Department of the province, and related departments (if necessary), and submits the project for approval by the Chairman of the Provincial People's Committee.

For projects managed by communes, the Provincial People's Committee approves them or determines the funding level to be approved by the District People's Committee.

- After approval, the Provincial People's Committee sends the project to the Standing Office of the Central Steering Committee for Program 135 (Ethnic Minorities and Mountainous Areas) for consolidation and notification to the committee members for implementation guidance.

2. Investment Preparation:

- Infrastructure works included in the investment preparation plan must correspond to the specified target groups as defined in point a, section 1, part A, and listed in the approved project.

- Annually, the sponsor must prepare the investment preparation plan for the next year's works under the Program 135, submit it to the Provincial People's Committee for decision. Investment preparation funds are allocated from the budget plan for Program 135.

- The investment preparation work is carried out as follows:

+ For works involving only earthwork and simple techniques such as village roads, inter-village paths, small dams, irrigation channels, water channels from streams to villages, well digging, family water storage tanks, school classrooms in villages, land leveling, etc., with an investment amount below 100 million dong, the sponsor only needs to prepare a list of items, quantities, and budget estimates, which are submitted to the competent authority for decision without preparing an investment report.

+ For construction works with complex techniques such as bridges, culverts, dams, pumping stations, electricity, schools, health clinics, inter-village roads, only an investment report is prepared without detailed review. The sponsor selects a consulting organization to prepare the investment report, which is submitted to the competent authority for investment decision.

The contents of the Investment Report include:

- Projects in the approved infrastructure investment planning scheme that meet all the above requirements do not need to prepare an investment report and can proceed directly to the design and budget estimate stage.

3. Implementation of Investment:

3.1 Design - Budget Estimate and Execution Organization:

a. Design - Budget Estimate: The sponsor is responsible for signing or authorizing the head of the project management board to sign contracts with consulting organizations for design and budget estimation, and submitting these to relevant specialized agencies for review and approval by the competent authority.

- For works involving only earthwork and simple techniques, with an investment amount below 100 million dong, only a budget estimate based on actual work volume is required, without detailed design.

- For construction works with complex techniques, both design and construction technical design (one-step design) must be applied. The project budget must clearly specify the quantity of materials, capital, and labor undertaken by the commune.

- Unit prices for budget estimation are issued by the Provincial People's Committee.

- For works such as classrooms, health clinics, etc., typical designs (standard designs) issued by the Provincial People's Committee should be applied to suit local customs and conditions. The budget for such works includes the budget based on the typical design and additional budgets due to specific characteristics of the project.

b. Execution Organization: The District People's Committee decides on direct assignment of contracts without bidding but must assign construction units to prioritize using commune labor and pay wages to people participating in the construction project based on the approved budget estimate, with supervision by the commune.

For simple works within the project managed by the district that the commune can undertake, the District People's Committee assigns the commune to organize construction and take full responsibility.

- The investor shall cooperate and create conditions for other labor forces such as border guard troops, troops stationed in the locality, voluntary youth units, etc., to participate in constructing infrastructure projects and developing the economy and culture in communes under Program 135.

3.2 Supervision of construction: The investor, supervisory consultants, and the commune Construction Supervision Board shall coordinate to implement this..

4. Acceptance, handover, management, and operation of works:

The investor shall organize the acceptance of completed works. The acceptance team shall include: the investor, the Head of the Project Management Board, design units, construction units, supervisory consultants, and representatives of the Commune Supervision Board.

After completion of the work acceptance, the investor shall hand over all relevant files and documents to the People's Committee of the commune. The handover procedures must comply with current regulations.

Specifically, after the completion of land reclamation works, the People's Committee of the commune shall establish a list and area, which shall be approved by the People's Council and submitted to the competent authority for decision on granting land use rights to each household.

The provincial People's Committee shall issue guidelines for the handover, management, and operation of completed works.

C. Procedures for consolidation, allocation, and reporting of plans.

- The process of building, consolidating, and allocating annual plans for Program 135 shall be carried out concurrently with the general planning process but must be reported and allocated as a separate item in the annual plan.

- Annually, following the guidance on plan preparation from higher levels, People's Committees at all levels shall prepare investment plans and budget estimates for the local Program 135 and submit them according to current regulations; the provincial People's Committee shall consolidate and report to the Central Steering Committee of Program 135 to serve as the basis for allocating state investment support funds.

The Ministry of Planning and Investment shall take the lead and coordinate with relevant agencies to allocate central budget support funds for the Program. After the annual budget estimate has been decided by the competent authority, the Central Steering Committee of Program 135 shall notify the average investment support capacity for communes, based on which the project investors and the Heads of the Project Management Boards shall prepare necessary conditions to implement the plan.

- Allocation of plans: Annual plans shall be allocated as follows

Acting on the delegation of the Prime Minister, the Ministry of Planning and Investment shall notify the total investment amount for infrastructure projects and production and business investment projects to the provincial People's Committees as separate items in the provincial general plan and inform the permanent office of the Central Program 135 for monitoring and directing.

The provincial People's Committee shall allocate support funds for Program 135, local mobilized funds, and integrate national target programs for each district according to the project.

The district People's Committee shall base on the plan assigned by the province and combine with local mobilized resources to specifically allocate for each work.

- The Project Management Board shall report to the project investor to consolidate and report to the permanent body of the Provincial Programs' Steering Committee according to the current reporting system; the Provincial Programs' Steering Committee shall report to the Central Program 135 Steering Committee according to the regular reporting schedule (quarterly, six-monthly, nine-monthly, annually). The report content should reflect the workload assigned in the annual plan, implementation results including quantity, quality, progress, mobilization of investment resources, completed works, difficulties and obstacles, and proposed solutions.

- The permanent body of the Central Program 135 Steering Committee (Ministry of Ethnic Affairs and Minority Affairs) shall consolidate and report on the implementation of the program according to the regular schedule to the Prime Minister, related ministries, and sectors according to current regulations on managing national target programs.

D. Investment capital and use of investment capital:

1. Sources of investment capital for the program:

(A). Local resources mobilized from the people, mainly money, materials, and labor.

(B). Support from economic sectors, social organizations, and other localities contributing in the form of money, materials, and labor.

(C). State budget capital, divided into:

(D). International organization support.

Therefore, the sources of investment capital that the project investor needs and can consider for planning include: A + B(a) + C + D(a).

Additionally, there are also state budget investment funds through national target programs and other investment programs and projects investing in the same area.

2. Use of central budget support funds:

- Central budget funds shall only support investment in works specified in point a, section 1, part A of this circular for Program 135.

These funds shall not be used to invest in works outside these categories.

- Construction investment capital for works shall be divided into: construction and installation, equipment, and other basic construction costs.

Other basic construction costs shall cover: investment report preparation, design, cost estimation, review, construction supervision, project management board activities at the district and commune level; compensation for land acquisition, crop damage compensation, site clearance, campsite costs (if applicable); final account review and work acceptance costs, which are included in the work cost estimate and settled within the work cost estimate. Specific expenditure rates for the above tasks shall be applied according to Circular No. 12/2000/TT-BXD dated October 25, 2000, issued by the Ministry of Construction.

* Allocate funds for infrastructure planning work of communes and ethnic minority and mountainous areas development projects within the annual state budget expenditure plan; management fees for the program and activities of the steering committee at all levels of local authorities shall be allocated within the annual administrative management expenditure plan of the state budget. The provincial People's Committee is responsible for directing and guiding the allocation and ensuring funding for each level (province, district, commune).

III. MECHANISM FOR DISBURSEMENT AND SETTLEMENT OF INVESTMENT FUNDS:

1. Mechanism for disbursement of investment funds under Program 135:

- All sources of investment funds for Program 135 must be centrally managed through the State Treasury to disburse and settle payments for each project according to approved plans (if in kind or labor, record income and expenses according to the financial authority's order).

- Central State Budget support funds for communes under Program 135 will be supplemented with targeted funds to the local budget.

- The Ministry of Finance will notify the People's Committees of provinces under Program 135 about the amount of funds transferred in each batch to the locality. Based on the provincial People's Committee's allocation decision and the amount of funds transferred from higher-level agencies, the financial agencies at all levels in the locality promptly and fully transfer to the State Treasury system.

- The State Treasury system is responsible for supervising, advancing, and settling investment funds for the actual volume of projects and works according to regulations.

- The provincial People's Committee is responsible for directing relevant agencies on the territory to ensure sufficient and timely funding for projects.

2. Mechanism for supervision and settlement of investment funds:

The disbursement and settlement of investment funds for infrastructure projects under Program 135 shall be carried out according to the following provisions:

- Conditions for fund disbursement: The project investor sends the main documents to the State Treasury of the county (where the account is opened):

- Implementation of advance payment and settlement:

Works undertaken by the people in the commune can receive up to 50% of the annual capital plan and full settlement according to the completed and accepted volume; works undertaken by enterprises can receive up to 30% of the annual capital plan and full settlement according to the completed and accepted volume.

The total amount settled may not exceed the approved project budget and the annual capital plan index already announced.

- The provincial People's Committee is responsible for directing relevant departments of the province to inspect compliance with investment and construction management regulations, fund disbursement, and settlement for infrastructure construction works in communes.

3. Annual settlement reports and completion project settlement reports:

- Quarterly, the project investor and the State Treasury of the county shall submit financial reports to the superior management agency, the financial agency transferring funds, and related provincial agencies regarding the results of receiving and investing funds for infrastructure projects in communes.

- Annually, the project investor shall prepare a settlement report on the use of funds and send it to the superior management agency, simultaneously sending it to the State Treasury of the county for reporting to the superior State Treasury and the financial agency transferring funds.

- At the end of the plan year, the project investor shall submit financial reports (including annual settlement and completion project settlement) in accordance with current regulations.

Upon completion of the project, the project investor shall prepare a completion project settlement report and submit it to the co-hosted financial agency at the same level for joint review and approval by the provincial People's Committee, and send it to the Provincial Steering Committee's permanent office of Program 135 for reporting to the National Steering Committee of Program 135.

These reports shall be sent to the National Steering Committee of Program 135 (UBDT&MN) for consolidation and reporting to the Prime Minister and members of the Program 135 Steering Committee.

IV. IMPLEMENTATION PROVISIONS:

- Based on this Circular, the provincial People's Committee shall concretize and guide in accordance with the characteristics and circumstances of their locality to effectively implement Program 135.

- Relevant sectors and levels, based on their functions, are responsible for directing, inspecting, supervising, and urging compliance with this Circular.

- This Circular replaces Circular Joint No. 416/1999/TTLT/BKH-UBDTMN-TC-XD dated April 29, 1999, issued by the Ministry of Planning and Investment, the Committee for Ethnic Minorities and Mountainous Areas, the Ministry of Finance, and the Ministry of Construction, guiding the management mechanism for investment and construction of infrastructure projects in communes under Program 135, which comes into effect from the date of issuance. Any issues arising during implementation that are not suitable should be reported to the Permanent Office of the National Steering Committee of Program 135 (UBDT&MN) for study, supplementation, and further improvement.