The Directorate for Combating Corruption under the Anti-Corruption Commission led by Sotir Tsatsarov began an investigation on Monday in the municipality of Stara Zagora concerning violations of the Public Procurement Act (PPA).
This pertains to two contracts awarded by the municipal company “Trolleybus and Bus Transport” EOOD. These contracts are financed through EU operational programs – “Regional Development 2007-2013” and “Environment 2014-2020.” One contract is for the delivery of 55 new high-class diesel buses, valued at 35.6 million BGN, while the second is for 33 new electric buses, 18 charging stations for them, and 2 transformer stations, totaling 49.1 million BGN. The Anti-Corruption Commission reported that it is working on a signal alleging that officials, including those in high public positions, received material benefits to favor a specific contractor in these contracts.
The investigation commenced on Monday, November 29, at noon. By the end of the working day, Mayor Zhivko Todorov, the responsible Deputy Mayor Yordan Nikolov, who is also the chair of the committee selecting the contractors for the two public procurement contracts, and the manager of the municipal company that conducted the tenders, Eng. Georgi Stanchev, held a joint press conference. The aim was to convince the media that the municipality’s leadership and the company conducted the tenders entirely according to legal requirements. The mayor announced that they would provide full cooperation to the investigators. They have already submitted their personal impressions of the conducted tenders in writing and are set to provide all technical documentation as well.
Mayor Todorov dismissed the journalists’ hypothesis that
the investigation is a political attack against him,
stating twice that the municipality has nothing to do with the public procurement tenders.
However, he commented that when the Anti-Corruption Commission provides information in advance, it creates a misleading public opinion. “I do not like that,” the mayor remarked. He added that to ensure greater transparency in the committees, there are representatives from the municipal council, which is the principal body of the “Trolleybus and Bus Transport” company.
The first tender for the 55 diesel buses is already seven years old. Their acquisition was part of the first phase of the project for the modernization and development of sustainable urban transport, which aimed to replace the outdated bus and trolleybus fleet of the city. The Polish company “Solaris” won the public procurement for 50 buses and 22 trolleybuses, excluding the five articulated buses supplied by the Czech company SOR Libchavy. “For the truth” (“Za Istitata”) reported on this topic nearly three years ago.
Stara Zagora gained notoriety for paying 526,000 BGN for a single bus, while the same company offered the same bus in Sofia for 303,000 BGN. The price difference for 50 buses amounts to 11.1 million BGN.
At that time, the deal raised suspicions of corruption, and those doubts persist today.
Moreover, for 95 million BGN from the Operational Program “Environment,” the Polish company supplied 100 trolleybuses—not only for Stara Zagora but also for the modernization of fleets in Varna, Burgas, and Pleven. The same brand also provided 50 trolleybuses to the capital under the integrated urban transport project valued at 54 million BGN without VAT.
Both during the finalization of the deal in Stara Zagora years ago and at the press conference last night, Mayor Zhivko Todorov and his deputy Yordan Nikolov explained the drastically higher price of the buses in Stara Zagora by citing the inclusion of video cameras and more telematics, such as the driver’s information display, as well as the larger engine size.
In the initial months of their operation, the buses exhibited a significantly greater fuel consumption, which has further increased after 300,000 km of mileage.
They are now fully amortized and are beginning to fail and show deficiencies, confirmed the new manager of the municipal transport company, Eng. Georgi Stanchev, to “For the truth” (“Za Istitata.”)
However, at the press conference, it was stated differently—that the buses are reliable and have good characteristics. Experts have classified them as not the most suitable for urban driving, with the larger engine size deemed completely unnecessary, given that there are few rugged terrains in the municipality.
According to drivers from the company, the buses are now in a deplorable condition. During last winter’s sub-zero temperatures, 20 of them failed to start due to waterlogging in the system, as their dehydrators had not been replaced. Instead of being replaced, the DPF filters were merely cleaned, which the company’s manager referred to as an acceptable practice, given the high cost of new ones. It is also unclear when and how a complete analysis of fuel and lubricants is carried out, or how and
by whom the buses undergo technical inspection.
One of the drivers recounted how he had to keep his foot on the brake throughout the duration of stops due to a faulty sensor that blocks the door systems while the bus is not in motion. To date, 12 of the buses are not in operational mode due to technical issues. They have not been running on the respective routes for over a year and a half; additionally, two of them are already being used for parts, which should have led to their disposal. Furthermore, the supply of all spare parts goes through a Serbian company, which further increases the costs of repairs and maintenance for the buses.
The contract for the delivery of the diesel buses has been fulfilled, the procedure has long been accounted for, and according to the mayor, there are no issues with it.
The second public procurement under investigation by the Anti-Corruption Commission for the delivery of 33 new 12-meter electric buses and additional equipment for public transport in Stara Zagora was won by “El Bus Track and Coach Bulgaria” EOOD. Mayor Todorov stated to the media that the process was conducted with full transparency and representation from the municipal council, as the municipality always does when using significant public resources.
Out of the 11 participants in the public procurement procedure, three have appealed the decision to the Commission for Protection of Competition (CPC) and the Supreme Administrative Court (SAC). Both the commission and the court ruled in favor of the municipality. According to Zhivko Todorov, this procurement was suitable for large consortia, including foreign ones, rather than small companies with questionable reputations.
“If there had been any issues, they would have noticed them and alerted the appropriate authorities,” the mayor stated. He claimed that they adhered to the law and served the public interest, as three large European consortia were ranked in the final evaluation from all respondents who met the criteria. The contract was awarded to the one with the lowest price offer, “which is the correct, legal, and protects the interest of the citizens,” the mayor commented.
For the delivery of the electric buses branded IRIZAR, the Stara Zagora company “Trolleybus and Bus Transport” has already made an advance payment of 30% of the total contract amount, which is 49.1 million BGN, meaning that approximately 16.5 million BGN has been transferred to the consortium.
Manager Eng. Stanchev indicated that the same scheme was applied in Burgas. However, there, at least four buses have been delivered.
There are also issues with the implementation of the automated fare collection system in the public transport sector, which is part of the project for modern and integrated urban transport.
The project, worth nearly 4 million BGN, was supposed to be completed within 30 months, but that timeframe has already passed. According to Engineer Stanchev, the system has shown weaknesses and is still undergoing testing in a pilot project on three of the city lines.
The system has malfunctioned about four to five times a week, raising concerns for the manager that without conductors, the company could incur substantial losses. Currently, the company employs 110 conductors with an average monthly salary of 1,000 BGN (including social security and taxes). However, no one can estimate the amount needed for the system’s maintenance once the warranty period expires.
For the first three quarters of this year, the losses of “Trolleybus and Bus Transport” have slightly exceeded 1 million BGN, with accumulated debts of 5.1 million BGN over five years. It is likely that these debts will increase further due to the Covid crisis, which has significantly reduced the number of citizens using public transport.
We sought the opinion of Maria Dineva, Chair of the Municipal Council in Stara Zagora, regarding the management of the company, her awareness of the public procurements under investigation, and the judicial past of Engineer Stanchev, which may create dependency in his position. However, we were unable to reach her for comment.
How long the investigation by the Anti-Corruption Commission will continue
and whether it will establish any violations in the procedures for the two public procurement contracts remains to be seen. It is most logical to assume that the signal being investigated was submitted by one of the companies or consortia that participated in the tenders, as we all know how the technical parameters to which participants must comply are prepared.
It is intriguing to learn how the length of the buses’ bodies was determined, which, according to sources familiar with the details of the public procurement, was exactly 18 cm longer than that of the buses from the Czech company “SOR Libchavy.” This effectively eliminated them from participation in the procedure.
Similarly, the technical specifications for the electric buses required a motor with a power of 180 kW, which, according to expert opinion, will not be able to operate without recharging during the day. In contrast, a 160 kW motor—such as the ones offered by “SOR Libchavy”—would consume less electricity and could last through a full day of operation.
These are just two examples; we cannot even speculate on what the investigators might discover. Rumors about requests for 50,000 BGN per bus from a company that was promised it would win one of the contracts remain unconfirmed. The ball is now in the court of Sotir Tsatsarov and his inspecting team. It might be that the former chief prosecutor and current head of the Anti-Corruption Commission has realized that the GERB ship is sinking and has decided to lift the umbrella that has been provided over the individuals appointed during Boyko Borisov’s administration.
If the commission does not uncover corruption in these public procurements, it would not be surprising if the same signal were submitted to the European Prosecutor’s Office. After all, we are talking about tens and hundreds of millions of euros from European funds that Laura Kövesi is tasked with protecting.
