Normative and Legal Aspects of Land Utilization and Land Owning in Modern Conditions
Strelbizky V.P., deputy head of the Department of Investment Policy and Financing from Municipal Sources of Moscow
In conditions of reforming of economy the value of a private property on ground has increased. In general well-being of each member of the society, social progress, development of economy and ecological balance depends on the land tenant.
This dependance is observed in the system of market relations arising in borders of urban settlements. Here, where life of each person is closely bound with the destinies of other people, any changes in distribution and use of the urban land fund mean the appropriate “shifts” in a lay-out and building of city,hence, in conditions of existence of all the inhabitants.
The transition of economical land mutual relations which has been formed in conditions of directly planned management, to the new form is defined first of all by effect of two objective circumstances.
It is due to the general process of decentralization and essential expansion of the authorities of local bodies and also to amplification of a role of their executive structures in the decision ofq uestions of use of land potential subordinated territories. Secondly, it is the raising independence of managing subjects (irrespective of a pattern of ownership and range of business), their affirmation as legally and economically independent commodity producers, receiving on lawful basises a possibility to enter i equal rights relations concerning use of land resources.
The land lots, wich were earlier free distributed in eternal use, nowadays are transfering to those or other subjects to possession or in urgent use mainly on the compansative base (except for the grounds, selected on socially focused specifications).
There are changes in legal and economic aspects of the relations of land properties and other natural resources. After the saved forms of state and individual land property, the other forms of private property have also appeared : individual - private,share, cooperative, collective.
Despite of apparent simplicity of a problem, there are difficulties in practice of accomplishment of the legal rights of land use, possession.
It is well known, that the forms of assignment of material values (and property is first of all the assignment) are represented by the "Possession" and "use". A category of"Order" clears up the relations of the property in practical use.
"Order" is the realization of the property relations,its possession and use.
The development of the forms of assignment goes from the use to the property through the possession ( The possession can include use, and the property covers all this).The owner has the greatest economic possibility of disposal in comparison with the holder and the user (the holder means more then user). The possession is long term use,characterized by the partial economically realized assignment of material values.
Thus, use and possession make us see the various aspects of the relations of the property on different hierarchical levels of general system of the economic relations. Legal Registration of the rights of use, possession realized with the help of the legislative acts is only statement, fixing of the real property relations (private,state), dominating in the society.
The negative social and economic aspects of formation of a private land property (gamble, inefficient use etc.) cause the necessity to pay more attention to this question.
Having started the mechanism of formation of the private land property in our country in the same unreasonedly forced mode, which had been accepted at the period of state property privatization, we shall observe the same problems, that are already known by the practice of West, but our problems will be worse and more painful.
For example, in Germany for the prevention of accruing of ground without use the authorities repeatedly attempted to enter special tax, which would serve as the remedy for economic coercion of the landholder to its efficient use or to disposal to other owner. But those efforts met persistent recalcitrance influential in the political relations of a land owners’ class. The sharpest contraventions in the land relations arise on West in connection with private land property within the limits of urban territories.
Russia has got a big social and economic problem: to create a system of land use providing real economic freedom of efficient land use without dependence on,the pattern of ownership of the managing subject. The main prival land property ought to be "The property for use". In Switzerland such property is called "building tenancy", in Germany "the succession right of building", which is granted on the term of 50 - 99 years. By its legal essence "property for Use" is reliable and mobile, as well as the usual private property.
"The Owner for use" pays to the society the land tax (equal to the rent, received from land use),the acquiring of this property right is compensated by continuous entering of this tax. It is the difference of acquiring the land in a private property, when a price of land is repaid at once, at the committing of the act of purchase of sale.
It is necessary to note, that physical limitation of the land resources and the sole right of a private land property encourage reduction of the offer on the market. Hence, the land market functions not in a mode of equation of a supply and demand,on the contrary, the disbalance of demand and offer amplifies the increasing of the prices.
It has a considerable negative effect for the inflationary economy of Russia.
Moreover the new land legislation has concentrated the main attention on agricultural grounds. It has caused a lack of attention for the land relations in settlements and in cities.
The fight for ground began in cities and settlements, there is even a self-capture of plots, the huge amount the improper decisions is accepted by local authorities, and land users.
The land relations in settlements and especially in cities objectively differ from territorial – economic interactions concerning land resources in a village. The price of the agricultural plot depends on its efficiency and rent of a site. In settlements and cities a market price of a land plot dependent on a supply and demand, will be constituting by set rental, dependent from the following factors: an ecological situation, a prestige of the area, transport availability, security by an infrastructure (water-pipe,electricity, modern communication facilities etc.)
Therefore it is impossible to define practically the price of an urban plot outside of real functioning of the land market.
Besides, the essence and forms of land relations in the settlement are indissolubly linked to the process of town-planning development, much more dynamical, then the course of functional changes of agricultural grounds. The new order of land regulation in cities and in settlements is invoked to give to the local authorities a possibility to decide a part of problems of welfare of the population by means of more rational use of the land plots by the all managing subjects.
The former Supreme body of Russian Federation has played a considerable role in the creation of the egislative base exacting for reforming of the land relations. It accepted the land Code of RSFSR (April 25, 1991), the law "About the property in RSFSR" (December 24, 1990),the order " About differentiation of state ownerships in Russian Federation on the federal property,state ownership of republics in making part of Russian Federation, edges, areas,independent areas, independent districts,Moscow City, St.-Petersburg City and municipal property " (December 27 1991), laws of Russian Federation "About protection of environment" (December 19 1991), "About the resources" (February 21, 1992) etc.
The basis items make part of the named legislative acts. So, in the law " About protection of the environment " the whole section is devoted to problems of creation of the economic mechanism of protection of the water, wood and other resources.
The rights of the citizens of Russian Federation on receiving of the land lots are adjusted by the articles 7, 14, 18, 27, 58-69 of the Land code of RSFSR, by the appropriate standards of the law of Russian Federation "About the land reform", and also by the Decree of the Russian President dated October 27, 1993 ¹1767 "About the regulation of the land relations and development of agrarian reform in Russia", which affirms the private right on a land property. It is marked in item 1 of the Decree, that "The land lots and everything, linked to them refer to the real estate. The conclusion of the bargains is adjusted by civil procedure law with allowance for land, wood, environmental and other special legislation and also for the present Decree".
However there are limitations of the rights of the citizens on ground in the current legislation. It is due to a special-purpose designation of grounds, with area of a granted plot and with the possibility of disposal by ground.
Limitation of the property land right of the citizens by the sign of a special-purpose designation (item 7 of the Land code of RSFSR, item 4 of the law of RSFSR "About the land reform") means, that land lots can be granted in propriety only for definite purposes: for management of the country economy, for personal part-time farms, collective or individual gardening, animal industries,individual or cooperative housing ñonstructions. The agricultural lands can not be granted for other purposes.
The sign of a special-purpose designation is saved in granting of lots on the right of chronic(life) inherited possession,use or lease. So, according to the article 7 of the land Code of RSFSR the land lots are granted in chronic(life) inherited possession or in the lease to the citizens of Russia for:
- Individual or collective country constructions;
- Constructions of collective and individual garages;
- Enterprise activity and other purposes, not forbidden to the law.
The item 3 of the Decree of the Russian President dated October 27, 1993 fixe the standard, which extends the rights of the leasers, it is noticed, that "The citizens received the plots in chronic(life)inherited possession or permanent use or taken them into the lease, except for the lease at the natural persons, have the right on granting and redemption of those plots to the property according to the legislation".
The law of Russian Federation dated December 23, 1992 "About the right of the citizens of Russian Federation on receiving in private property and on sale of the land lots for management of personal auxiliary and country economy, gardening and individual housing constructions" the persons who have received the land plots for the indicated purposes in cities, settlements and the right can "sell them to the other citizens of Russian Federations irrespective of terms of acquiring of the property rights on the sold land according to the standards of granting of the land lots" (article 1). However "the use by the owner of the bought land lot fot not for a special-purpose designation,if other is not statutory isn’t permit".
Besides, the Decree of the President dated June 14, 1992 N 631 affirmed the order of sale of the land lots at privatization of state and municipal enterprises,of the expansion and additional construction of those enterprises, also granted to the citizens and their associations for enterprise activity.
Only the land plots which are directly engaged as state property objects or which are necessary for their service objects are subject to privatization. The sizes and borders of the sold plots are established on the basis of the documents issued to the appropriate enterprises for the permanent right of use, and in case of their absence on the basis of actual use.
The grounds in cities and settlements, which sale and transferring are forbidden, are stated in the decree. Those are the agricultural grounds, common use grounds,reserves, parks etc.
Legal or natural persons who have privatizated objects of sstate or municipal asset act as buyers of the land lots. The right on a purchase of the land lot is Received only by a person who has privatizated an object of the state property, it makes the sale of the plot outside of a competitiveness.
The cost of the land lot is not included in the privatization price of the enterprise and represents the detached subject of the purchase and sale contract.
The decree of the President dated June 14 1992ã. N 631 grants right on purchase of ground not only at privatization of the enterprises, but also in connection with their expansion or additional construction. In these case the sale of the ground is realized on competitive or auction basis. The initial price is established not below the normative price. If there is only one land lot it’s sold on a standard price.
The land plots can be sold to citizens and their associations with Special-purpose designation – for an enterprise activity. The sale is realized on competitive or auction basis.
In the case of permanent use, they can be renewed in the property with issue of the appropriate documents.
Transfer of the land lots in the property of the citizens is made by local councils of the national deputies for the payment and free of charge (article 7 of LC of RSFSR).
According to the current legislation the land lots are transmitted to the property for the payment and are destinated for gardening and animal industries, and also for individual housing ñonstruction and personal part-time farm in cities and settlements. Urban and settlement councils of the national deputies have the right to establish privileges or to release from the payment some categories of the citizens (retirees, people waiting for receiving of living space etc.) by transfering to them land lots for construction of village houses (article 7 of LC of RSFSR). Use of ground in RSFSR is stipendiary (article II of the Law of RSFSR "About land the reform").
In 1991 the law "About the payment for ground" was accepted. According to the article I of this law the forms of the payment are:
land tax, rent charge, normative price of land. The aim of introduction of the payment for ground is the stimulation of more rational use, protection and development of land plots, raise of ground fertility, flattening of social and economic conditions of managing on the grounds of different quality, ensuring of development of the infrastructure in the settlements, Formation of special funds for the financing of those measures.
The owners of ground, land tenants and land users, except for the leasers, have to pay the annual land tax. In conformity with the articles 7 and 8 of the law of Russian Federation "About the payment for ground" the tax for grounds of cities, for working, resort and countryside grounds is levied from all enterprises,organizations, establishments and citizens having in their property, possession or use the land lots, according to the rates for urban grounds.
The tax for the land lots of the superior area then it’s established by standards of recusation,is levied in the double size.
The tax for grounds engaged in housing fund( state, public,cooperative, individual), and also for grounds of agricultural use and personal part-time farm in cities and settlements makes 3% of the rates of the land tax, established for cities and urban settlements.
For a purchase and redemption of the land lots in cases stipulated by the Land Code of RSFSR, and also for receiving by the deposit of grounds of the bank credit the standard price of ground is established (article 25 of law of Russian Federation "About payment for Ground"), it is a parameter describing the cost of a plot of the defined quality and situation proceeding from the potential income for settlement payback time. "Standard price of ground is entered for ensuring of economic regulation of the land relations at transfering of ground for collective common property on ground, descent, donation and receiving of the bank credit according to the land lot deposit".
The decree of the President of Russian Federation dated 27 October, 1993 N 1767 "About regulation of the land relations and development of agrarian eeforms in Russia" defines and precises mechanisms and warranties of the real private land property. The article 8 of the Decree reconfirms the order of sale of the grounds to the owners privatizated the enterprises stipulated by the Decree of President dated June 14, 1992 N 631 "About the affirmation of the plots’ sale order at privatization of state and municipal nterprises, their expansion and supplementary reconstruction of those enterprises, and also granted to the citizens and their associations for enterprise activity.
The decree dated October 27, 1993 guarantees the inviolability and protection of the private property on ground. The item 4 of the Decree alleges:
"The State guarantees the inviolability and the protection of the private property on ground, and also the protection of the rights of the owners of ground at conclusion of the bargains with ground. The exemption of the land lot for state and public needs is made in the statutory order by the redemption with allowance for interests of the owner,including caused losses and reimbursement of the cost of ground at the contract price, moreover taking in consideration the lost profit.
All disputes connected to disposal and acquiring of the land lots, and also other land disputes are subject to the legal process".
The new Land code designed by the government of Russian Federation, Fixes the right of a private land property, considers all the complex of the relations linked to this right and to the land use, introduces a number of limitations for purchase and sale of the land lots. (the limiting dimensions of the land plots of one person are established in this Code ; it is forbidden to change a special-purpose designation of the plots; the territories of the non transmitable grounds; the legal persons and foreign subjects are authorized to possess the land lots only on hire basis.)
The new Land code caused much disputes. The new Land code presents the landownership not only as absolutely private, but also as property for ground use.
The property for ground use differs from the classical private property because the object of the purchase and sale is represented by the fixed capital,placed on a land plot. A price of land is defined taking in consideration the cost of the capital and rate of the land tax which do not exceed the rents’ volume. Thus the ground will be left in state property and simultaneously won’t constrain the rights of the land users, granting them all possibilities for receiving the enterprise income.
The adoption of the new Land code promotes the struggle with land lots gamble and creates the conditions for Receivings of the rent from the ground use. The rent can be used in interests of the society by means of a profitable part of the budget.
At the same time it is necessary to note, that in such large cities, as Moscow it is difficult to define the real value of the land lots. In Moscow exists the particular system of the land relations. Since the end of 1991 till the end of 1999 it is accepted in Moscow more than 50 normative acts defining all the aspects of the land use and of the payment for ground. Basing on the general federal standards, Moscow system of legislative acts has one big difference, it allows to grant urban grounds only on hire basis and doesn’t permit the ground’s sale.
The particular Moscow approaches are designed for zoning of the urban territories for the definition of the average land rates and taxes.
The procedure of grant and exemption of grounds in Moscow is regulated by several all-Russian and urban administrative standards.
According to the LC of RSFSR and to the decrees of President of RSFSR dated August 28, 1991 ¹ 96 "About the authorities of bodies of the executive authority of Moscow" and dated December 29, 1991 ¹ 334 "About the additional authorities of Management bodies of Moscow for a period of conducting of the radical economic reforms" the granting in use and exemption of grounds in a capital are made by means of Moscow governmental orders on the basis of the General plan of development of the city and drafts of a detailed lay-out for territory building.
The last years the very important orders of the mayor of Moscow were issued: "About the creation of territorial unit with special status in Central administrative district of Moscow " (April 10, 1996 ¹193-ÐÌ); "About the affirmation of the provision about composition, order,engineerings, coordination and affirmation of the drafts of a detailed lay-out of reconstruction of industrial and warehouse territories of Moscow" (June 24, 1996.¹10/1-ÐÌ); "Supplement to standards of buildings’ designing in Moscow ÂÑÍ 2-85 concerning the residential reconstructions" (10 November, 1996 ¹287/1-ÐÌ); "About the rent charge for ground in Moscow" (September 25, 1998. ¹980-ÐÌ). It is accepted a Moscow law "About Composition, order of engineering and adoption of the general plans of development of city of Moscow" (10 December, 1997 ¹53); "Law of city of Moscow" About town-planning zoning of Moscow territories" (November, 1998 ¹28), and also the Governmental order of Moscow "About the affirmation of the Provision about state town-planning cadastre of Moscow" (10 November, 1998 ¹874), Law of city of Moscow "About the general plan of development of Moscow" (June, 1999) and other acts.
The named documents contain the demands which are providing against the use of the land lots by the ways causing the aggravation of ecological situation.
The order of rating of ground is established In Moscow (rates of payments for ground) it was made according to the affirmed list of the territorial estimated zones. there are 69 zones in Moscow. 34 are situated in limits of the Moscow district road, 35- 48 zones are separate territories,subordinated to Moscow (Sheremetevo, settlements Akulovskiy, Vnukovo etc), 49-69 zones are territories of Zelenograd city. The named zones are defined by the orders of the mayor of Moscow.
According to the order of the mayor of Moscow dated 25 September, 1998 ¹ 980-ÐÌ the rates base of the annual rent charge for ground are established according to a category of the leasers and kind of target use of the grounds (article 21 of the law of Russian Federation " About the payment for ground ", the article 35 of the Charter of city of Moscow, other federal and urban legal acts) and can be reviewed for increasing only one time at the 1 year period;
Volume of a base rent depends on a kind of the managing activity of the subjects, of their social and economic characteristics and of the policy of Moscow government directed on creation of the favorable conditions for accomplishment of the state urban programs concerning the support of the socially important branches, the ecological improvement.
Since January 1999 the average rate for urban ground in the city was established in the volume of 180000 rubl./hectare.
For the account of the town-planning value of city territories the base rates rent of the payment for ground are differentiated by categories of the leasers and kinds of target use of grounds,by territorial economic areas and zones of the bigger values with the help of the factors of territorial differentiation.
There is the rating of the land tax according to the separate subzones, objects etc.
At the same time, it is necessary to note, that the analysis of results of the hold commercial competitions and vendues concerning the right of the lease and construction development in Moscow proves that sometimes the urban grounds are exhibited on commercial bargains groundlessly undercharge,it is based on the social focused specifications. The prices of realization of the commercial bargains are bit different from the initial cost and also do not correspond to the real cost of the land lots in Moscow.
The rent charge for grounds allocated to the inhabitants for the defined kinds of personal use (construction of an apartment house for people who are waiting for the housing, gardening) should depend on a level of the capitation incomes of a family and correspond to the social standards. At the interaction with the commercial structures the commercial rents owe to reflect a market price of ground in Moscow.Taking in consideration this fact the definition of the ground cost in conformity with its market price is a big problem.