The Hungarian town of Balatonf\u00fcred, in spite of lying beside the country\u2019s biggest lake, does not have a big tradition of water polo: even if there were some fans in the town, Balatonf\u00fcred never had a professional team and licensed players. In June 2011, however, the municipality decided to create the Public Benefit Foundation for the Water Polo of Balatonf\u00fcred. Despite its name, the most important task of the organization was other than supporting water polo. Through the foundation, the town was able to tap state subsidies that had not been available for the municipality for the construction of a local swimming pool.<\/p>\n
Many locals had long been dreaming about an own swimming pool, but due to its high costs, before 2011 the investment had been out of question at city council meetings. The situation changed when the government reshuffled the corporate tax system and offered tax-breaks for companies that support certain spectator sports.<\/p>\n
This is the money that Balatonf\u00fcred jumped on. In order to receive the funds, however, the town had to use a trick. As the corporate tax benefit scheme known as TAO programme was not designed to finance municipal investments, the local government of Balatonf\u00fcred hid behind the foundation in order to receive several millions of forints for the swimming pool. While this is not unlawful, it goes against the principle and aim of the scheme. What is more, during the longer-than-expected construction, the cost had been continuously increasing, in total by more than several million forints compared to the original plans.<\/p>\n
Istvan B\u00f3ka, the town\u2019s mayor belonging to the governing Fidesz party, does not hide that the foundation was primarily created in order to get the money. He thinks that there is no problem, as the investment is an old dream coming true, which makes everyone happy. Commenting on the fact that this was only possible thanks to the circumvention of the rules, he said: this is a very good scheme.<\/p>\n
Prime Minister Viktor Orban is also proud of the program. In an interview given in 2013, he called the results of the first two years of the scheme strikingly promising. \u201eWe do not want to win laurels for the government, nor for the local mayors. Instead, we let and even motivate local businesses and sport organizations to look for each other,\u201d Orb\u00e1n said as he described the aim of the TAO scheme.<\/p>\n
\u201eIt is certain that F\u00fcred badly needs a swimming pool. At the shore of Lake Balaton, children must know how to swim properly, as their life can depend on this,\u201d a mother of two living in Balatonf\u00fcred told Direkt36. Not only her, but both older and younger residents complain that although there are several indoor swimming pools in Balatonf\u00fcred\u2019s wellness hotels, most of these hotels offer expensive tickets and do not welcome school groups. Thus, before the construction of the swimming pool, residents of Balatonf\u00fcred did not really have anywhere to go and it was difficult to find a location in town for children\u2019s swimming lessons.<\/p>\n
The plan to construct the swimming was first mentioned in a 4-year economic plan of the municipality, written in April 2011. \u201eBalatonf\u00fcred is quite well-off financially, but, according to the town\u2019s leadership prevailing approach, it is better to carry out investments from subsidies instead of the town\u2019s own resources. When this TAO opportunity came, we indeed took advantage of it,\u201d a member of the municipality told Direkt36, on condition on anonymity.
\nBy amending the legislation on corporate tax in July 2011, the government made it possible for profitable businesses to use a part of their tax to support five spectator sports - football, handball, basketball, water polo and ice hockey \u2013 or the Hungarian Olympic Committee. Clubs and other sport organizations can submit their project plans to the respective federation to receive subsidy for the training of youth and related investments. If the plans are accepted, it is the federation\u2019s task to collect the necessary money from the businesses that pay corporate tax.<\/p>\n
Municipalities cannot tap these subsidies. This is why the leadership of Balatonf\u00fcred decided in 2011 to create a foundation that can apply for the grant \u2013 however, they made a mistake that made it clear that it was only a trick.<\/p>\n
Municipalities cannot create foundations. This is why the Balatonf\u00fcred municipality entrusted one its own businesses to set up the foundation. The mayor argued that this was the municipality \u201ccan exercise full control\u201d over the foundation, the minutes of the municipal meeting. The mayor told Direkt36 that the if there had been a possibility, the municipality would have carried out the investment, but \u201cit was set who, and for which purposes can receive the TAO subsidy.\u201d He said that the scheme was a very important opportunity to develop the town\u2019s infrastructure. \u201cWe wanted to have an asset that is not owned by a sport association, but stays in the indirect ownership of the town itself.\u201d<\/p>\n
Most of the positions at the freshly created foundation was occupied by the members of the municipality. Although a civilian was named as the head of the foundation, in practice it was led by the municipality according to members and the minutes of its meetings. The president of the foundation said at a meeting in 2012 that the TAO applications were written by the rapporteurs of the municipality, and they will also be the ones \u201etaking care of the public procurement processes\u201d related to the investment.<\/p>\n
The trick worked. The past five year\u2019s data on TAO shows that the Foundation for Balatonf\u00fcred\u2019s Water Polo was the best at jumping on the TAO money designated for water polo. In the first year, they received the highest amount of money, ahead of long-standing water polo clubs.<\/p>\n
The foundation received 352 million forints (\u20ac1.1 million) in 2011 for the construction of the swimming pool, to which it was supposed to add 147 million forints from its own sources. At that time, the paper of the municipality reported that the swimming pool was going to cost 500 million forints. 12 companies applied for the job, which was finally given to the Budapest-based Mech Vill Kft., which offered the cheapest bid (481 million forints) for the first part of the construction.<\/p>\n
The construction hardly started, when the foundation asked for \u2013 and received \u2013442 million forints in addition, for covering the swimming pool. The mayor argued that the initial 500-million plan could not be carried out, this is why \u201ewe had to restructure the whole story\u201d. The originally planned 25-meter swimming pool became 33 meters long, and a wellness section with saunas and jacuzzis was added to the plans, raising the cost to 1.2 billion forints. The second, 606-million-forint job was given to Mech Vill Kft. without announcing a public tender.<\/p>\n
According the mayor, the increased budget is not excessive, as \u201enowadays such a swimming pool cannot be build for less than 2 billion forints.\u201d The benchmark numbers of the Hungarian Water Polo Associations \u2013 published annually since 2012, including the suggested maximum price to be paid from TAO money for certain equipment \u2013 are lower. Calculating with the association\u2019s suggestions, the construction of the Balatonf\u00fcred swimming pool should have cost a maximum of 605 million forints. According to Mayor B\u00f3ka, from this amount would be enough only for a swimming pool without changing rooms, although the association claims that the price of the changing rooms are also calculated in the maximum price.<\/p>\n
In the end, the foundation did not even have to pay anything from its own sources, as the swimming pool was declared to be one of the future locations of the swimming championship to be organised in 2021. The government even declared the construction of the Balatonf\u00fcred swimming pool as priority investment and handed 350 million forints of state support for the municipality.<\/p>\n
Although the foundation was set up with the aim to support the training of the new generation of water polo players, many signs suggest that in the first years of its functioning it did not have any activities apart from those connected to the swimming pool investment. For example, applying for the TAO subsidies, the foundation admitted that there was no training for water polo players in Balatonf\u00fcred. Mayor B\u00f3ka firmly told Direkt36 that straight after the creation of the foundation water polo trainings commenced in Balatonf\u00fcred, however, many signs contradict his statement.<\/p>\n
Until 2014, the Foundation for the Water Polo of Balatonf\u00fcred did not have any income from member fees or from other activities, according its project proposals submitted to the Water Polo Federation. The foundation did not have any expenses either, which means that they did not spend money on trainers, on renting fees of the swimming pool or on any training-related expenses. The foundation first presented a team at a championship \u2013 the Transdanubia Water Polo League \u2013 in the 2014\/2015 season, and it has licensed players only since 2013\/2014. In the first year, this was not a prerequisite for applying for TAO subsidies, but since then the rules have been changed and now it would be impossible to receive money without presenting a team at a championship.<\/p>\n
The Ministry of Human Capacities is responsible for inspecting the swimming pool investment, and the inspection is currently in progress, according to the Water Polo Federation. The ministry did not answer our question whether the foundation used the grants lawfully. The federation stated in general that they decide about subsidies based on strict regulations, and it is an important factor whether the application is in line with the professional goals of the federation. As the declared aim of the program is the establishment of new swimming pools, these kinds of applications, in theory, are always supported by the federation. They added that since the launch of the TAO system its regulations on awarding subsidies have somewhat changed, but one of the decisive factors \u2013 besides serious professional work \u2013 remains whether the planned investments could be used by a broad audience.<\/p>\n
The pool opened this January, and there are already water polo trainings held regularly, yet it is unclear who organizes them. On paper, there are two Balatonf\u00fcred organizations authorized for the task, but partly the same trainers and leaders work at both organizations.<\/p>\n
One of them is the Public Benefit Foundation for the Water Polo of Balatonf\u00fcred (which oversaw the construction of the pool), the other one is called Balatonf\u00fcred Youth Sports Club. Although local parents only ever heard about the training courses of the latter, both organizations are entitled to TAO subsidies. The trainings are held together, but there are two different water polo teams. There was even an occasion when the team of the sports club and that of the foundation played against each other. Istv\u00e1n Mak\u00f3, a leader from both organizations did not answer to our questions regarding the trainings and the TAO subsidies.<\/p>\n
Now that the construction of the pool has been finished, the Public Benefit Foundation for the Water Polo of Balatonf\u00fcred has no more opportunities to get a considerable amount of TAO subsidies for water polo. So it changed its name to Public Benefit Foundation for the Sports of Balatonf\u00fcred in 2015, then applied for TAO subsidies related to basketball games. The 200 mn HUF that it got for the goal is now spent on building a secondary school gymnasium. The foundation promised to hold regular basketball trainings for local children.<\/p>","protected":false},"excerpt":{"rendered":"
A subsidy received thanks to a trick, and worth hundreds of millions of forints, was used to build Balatonf\u00fcred's swimming pool, an old dream of the locals. Although nothing unlawful happened, the story is bleeding from a thousand wounds.<\/p>\n","protected":false},"author":15,"featured_media":3135,"comment_status":"open","ping_status":"closed","sticky":false,"template":"single-444.php","format":"standard","meta":{"footnotes":""},"categories":[27],"tags":[],"ppma_author":[523],"class_list":["post-9626","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-tao-milliok","author-cap-anita"],"authors":[{"term_id":523,"user_id":0,"is_guest":1,"slug":"cap-anita","display_name":"Anita","avatar_url":"https:\/\/secure.gravatar.com\/avatar\/?s=96&d=mm&r=g","description":"","first_name":"","last_name":"","user_url":""}],"_links":{"self":[{"href":"https:\/\/direkt36.exot.hu\/en\/wp-json\/wp\/v2\/posts\/9626","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/direkt36.exot.hu\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/direkt36.exot.hu\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/direkt36.exot.hu\/en\/wp-json\/wp\/v2\/users\/15"}],"replies":[{"embeddable":true,"href":"https:\/\/direkt36.exot.hu\/en\/wp-json\/wp\/v2\/comments?post=9626"}],"version-history":[{"count":0,"href":"https:\/\/direkt36.exot.hu\/en\/wp-json\/wp\/v2\/posts\/9626\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/direkt36.exot.hu\/en\/wp-json\/wp\/v2\/media\/3135"}],"wp:attachment":[{"href":"https:\/\/direkt36.exot.hu\/en\/wp-json\/wp\/v2\/media?parent=9626"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/direkt36.exot.hu\/en\/wp-json\/wp\/v2\/categories?post=9626"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/direkt36.exot.hu\/en\/wp-json\/wp\/v2\/tags?post=9626"},{"taxonomy":"author","embeddable":true,"href":"https:\/\/direkt36.exot.hu\/en\/wp-json\/wp\/v2\/ppma_author?post=9626"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}