Friday, March 05, 2004

Radio Free Europe / Radio Liberty
5 March 2004

Kocharian Reveals 'Abuses' In Gyumri Housing Distribution

By Emil Danielyan

The distribution of thousands of new homes built in the earthquake-ravaged city of Gyumri with the multimillion-dollar assistance of a U.S.-Armenian charity was accompanied by "numerous and quite serious" corrupt practices, President Robert Kocharian said late on Thursday.

Kocharian revealed in televised remarks that the process, completed late last year, has been scrutinized by an ad hoc government commission for the past three months and that its findings deserve a criminal inquiry by law-enforcement authorities.

The existence of such a commission, led by the head of the presidential oversight service, Vahram Barseghian, was not previously made public. Its low-key investigation has centered on a key segment of the $45 million project to rebuild Armenia's northwestern regions devastated by the 1988 earthquake. Work on the project has been underwritten by the Lincy Foundation of Kirk Kerkorian, a U.S. billionaire of Armenian descent.

The Lincy money led to the construction of some 3,700 apartments in the Lori and Shirak regions. Most of them were built in Gyumri, the capital of Shirak and Armenia's second city. The housing scheme was designed for thousands of families that have lived in squalid temporary shelters for more than decade.

But according to Barseghian, they were not the sole beneficiaries of the construction work carried out in Gyumri from 2002 through the end of last year. Presenting the commission's findings to Kocharian before television cameras, he said the local authorities failed to ensure the transparency of the process and have manipulated lists of families entitled to free housing. He also said that some of the new buildings in Gyumri have still not been connected to public utilities.

A somber-looking Kocharian responded by instructing law-enforcement agencies to look into the "abuses" which his commission claims to have detected. He accused the local government of hampering his administration's efforts to fully rebuild the earthquake zone.

However, it was not clear whether the criticism applied to the Gyumri municipality or the government-appointed regional administration. The two were locked in a bitter dispute last summer over who should distribute the new apartments. The distribution was previously handled by the city hall.

The Shirak governor, Romik Manukian, faced fierce resistance from Mayor Vartan Ghukasian when he attempted to implement a December 2002 decision by the Yerevan government to transfer that prerogative to the regional administration. The row was apparently settled in September with a compromise agreement brokered by Artashes Tumanian, the chief of Kocharian's staff.

Tumanian has personally overseen the implementation of the housing scheme and other infrastructure programs funded by Lincy. The charity has spent a total of $150 million for that purpose since 2001.

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