Klitschko and Co.’s dealings with the repair of the capital’s Krakow Cinema

The expert on urban planning issues notes that in 2017, everything started relatively well (by Kyiv standards) with a project for UAH 1.3 million for the overhaul of the building.

 

 

 

But in the summer of 2018, a tender for the overhaul was announced with an expected cost of UAH 74.3 million. The price fell slightly and on August 2, 2019, a contract was signed for UAH 71.3 million.

 

 

 

 

«This can be considered the beginning of the end – the whims go so far beyond the legal framework that it becomes extremely difficult to remedy the situation. The main problem is that the overhaul turns into a reconstruction with a change in external dimensions and extensions outside the existing foundations (the requirement in the assignment is to provide closed cold passages outside the building’s facades)», — Mohylnyi points out the gross violations.

 

He notes that the Kyiv City Council did not make any decisions on reconstruction – it only provided for major repairs. Secondly, according to the law, it is impossible to adjust the project to turn the overhaul into a similar reconstruction — a new project must be developed and it must have land and city planning conditions and restrictions documents. None of this was available to the repair customer, KyivKinoFilm, at the time the contracts were signed, and none of it is available now.

 

By launching this scam, the management of the Kyiv Cultural Cluster (before it was renamed Municipal Enterprice KyivKinoFilm) made it theoretically impossible to legally obtain a construction permit.

 

 

As a result of the adjustment, the construction price soars by almost 80% at this stage.

The first contract is terminated (more than 10 million worth of work was completed under it) and a new tender is announced with an expected price of 123 million. Namely, instead of the first project for 74 million, a new one for 133 million UAH is already in place,” the expert on urban planning issues writes further.

The bidding was held twice, both times rejecting the two «cheapest» bids and awarding the tender to Zh.O.K. LLC.

 

«Pay attention to the price diversity: the rejected bids were for 89 million, and the winner, Zh.O.K. LLC, won for 114 million. We could have saved 22%. In absolute terms, it was 25 million UAH, or more than a million USD at the then exchange rate. In fact, this difference is an approximate overestimation of the price, laid down for carve-up», — writes Mohylnyi.

As a result, this project was approved by the head of the Kyiv City State Administration Klitschko on February 26, 2020, by order No. 330 with an estimate of UAH 138.6 million.

But that was not the end of the allocation of millions for a small room. On October 11, 2021, a contract for additional work “that could not be foreseen” was concluded with Zh.O.K. LLC without bidding for an additional UAH 35 million.

 

«The project with this additional funds paid back in 2021 was just approved by the Head of Kyiv City Military Administration Popko only on June 15, 2023 (!). To avoid counter-arguments that the increase in construction costs is normal because prices for building materials and wages have been rising, additional construction work has appeared, etc. Look at the screenshots of the projects approved by Klitschko in 2020 and Popko in 2023», — Mohylnyi writes.

«According to experts, the cost of just  construction work has DECREASED over 2.5 years and after additional work has been added. Klitschko approved a project where the expert evaluation as of December 13, 2018 confirmed the cost of construction work in the amount of 75.7 million. And Popko approved the project, where the examination as of 06.30.2021 confirmed the cost of construction works in the amount of 70.7 million. But the cost of the equipment has indeed increased in a year and a half from 35 million to 64 million. It’s just that at first they decided to withdraw the money mainly because of the overpricing of construction work, and the designers and experts drew the necessary figures. And then, for some reason, it became more convenient to withdraw the money through overpricing the equipment, and the designers and experts redrew everything to fit the new scheme», — concluded Mr. Mohylnyi.