For the fourth year now, 4 million BGN have been blocked in the accounts of the municipality of Shumen and are literally dwindling in anticipation of the construction of a racetrack and an Arab investor.
The millions are state funding earmarked for the renovation of the equestrian facility near Shumen – a project initiated in 2020 by then-Prime Minister Boyko Borisov, who had grand plans for hosting world competitions and attracting Arab investors.
However, the implementation of the project has yet to begin, and the funds cannot be used to finance other projects, continuing to be carried over year after year in the accounts of the municipality of Shumen as a transitional surplus.
Borisov’s idea was to renovate the racetrack of the only state stud farm “Kabiyuk” near Shumen, allowing for the hosting of international horse racing events. For this purpose, the state relinquished its ownership of the equestrian facility and transferred the asset to the municipality of Shumen, after which it allocated 4 million BGN for its reconstruction.
The spending of such a vast public resource was neither urgent nor associated with any development priorities for Shumen. On the contrary, the racetrack was the least concern of the local authorities, who had far more pressing issues to address, such as ongoing water supply problems. The equestrian facility emerged as a “strategic” project quite coincidentally and in the typical management style of Borisov.
4 million arranged between two races
In the spring of 2020, then-Prime Minister Borisov attended horse races in the village of Pristoe near Kaolinovo, where traditional races called “kushii” are held for Todorov Day. The event attracted nearly 10,000 people from the Ludogorie region, and witnessing such a crowd inspired the former prime minister to propose building a racetrack in Pristoe, witnesses recount.
“Look how many people love horses; we can build a racetrack here,” the prime minister said to the crowd, and from there, the idea took off, recalls a GERB activist present at the meeting. However, the then-MP from the party, Mitko Alexandrov, suggested that the new racetrack should be in Shumen, where there was already an operational equestrian facility.
“Borisov asked how much money would be needed to modernize the Shumen racetrack, and Alexandrov replied that at least 2 million euros would be necessary. The prime minister then said that the state could find it,” explained the GERB activist.
Later that same day, Borisov presented the idea of a new racetrack to journalists in Shumen. However, the prime minister was already talking about a national racetrack. At the end of the month, the government press center released a statement about a phone conversation between Borisov and the Crown Prince of the Emirate of Abu Dhabi, Sheikh Mohammed bin Zayed Al Nahyan, during which, among other topics, the project for a racetrack near Shumen was discussed. “The two leaders agreed that Bulgaria and Abu Dhabi would invest in the construction of a racetrack for horse racing near Shumen,” the government press center announced with great fanfare.
At the end of 2020, the government voted to issue a targeted transfer of 4 million BGN to the municipality of Shumen. The funds were designated “for major repairs, reconstruction of the racetrack, and for building associated facilities and technical infrastructure.” In a separate decision, the state racetrack near Shumen was transferred to the municipality for management. At the time of the transfer, the racetrack was valued at 6.7 million BGN.
In 2021, the municipality of Shumen organized a public procurement to select a contractor, which was predictably won by “GP Group.” At that time, the company was winning almost all major projects in Shumen, despite numerous appeals from other participants regarding many of the procedures.
“GP Group” won the racetrack tender with a bid of 3,880,800 BGN (including VAT), which included construction and installation works, development of an investment project, and execution of author supervision. With the state funds, the equestrian facility was supposed to transform into a modern establishment meeting all criteria for international competitions. Concurrently, efforts to find an investor, including foreign ones, to participate in the racetrack’s reconstruction continued.
According to the agreement with the municipality of Shumen, “GP Group” was supposed to complete the reconstruction of the racetrack by the autumn of 2022, which included the construction of a racetrack for 16 horses, a covered grandstand with 1,000 seats, parking for 150 vehicles, fencing, and auxiliary facilities.
However, for more than a year, “GP Group” did not start any work on the equestrian facility. Only in September 2022 did the contracting company present a working project, only to announce that the allocated 4 million BGN would not be sufficient for anything. According to the company’s new calculations, the funds would only cover the parking, fencing, and grandstands, but not the racetrack itself. “GP Group” requested nearly 3 million BGN more for the racetrack, which the municipality of Shumen did not have. The overall renovation of the racetrack was estimated to cost around 10 million BGN (excluding VAT) according to the contracting company.
In May 2023, it became clear that the municipality of Shumen would initiate a new public procurement for the racetrack’s renovation since “GP Group,” chosen three years earlier, had withdrawn from the project.
“The company withdrew because the funds allocated in the public procurement were insufficient for the facilities requested for construction. The procurement was for engineering services, and a project needed to be created. The project has been completed, it will be paid for, we will cancel the procurement and announce a new one,” stated then-Mayor Lyubomir Hristov.
And the price is rising like an avalanche
Meanwhile, the project, which started at 2 million euros (4 million BGN), continues to escalate due to inflation and rising construction costs. The total cost of the racetrack has now increased to 18 million BGN, as announced by the mayor of Shumen, Hristo Hristov, while presenting the draft budget for 2024.
The targeted state funds for the racetrack remain in the municipality’s accounts as a transitional surplus, awaiting the organization of a new procurement to select a contractor. However, the mayor of Shumen admitted that it is unlikely that the project will commence this year, indicating that the municipality is once again seeking state assistance for the missing millions for the racetrack. This means that the renovation of the equestrian facility will not begin until at least 2025, and the 4 million BGN may no longer be sufficient even for parking.
So far, no one has held the previous mayoral team or the contracting company accountable for the failed project, the melted millions, and the damages inflicted on the municipality. If these funds had been utilized on time, three times more infrastructure could have been constructed, noted municipal councilors on this matter. Now, it is entirely unclear if or when the renovation of the racetrack will begin.
