FUNCTIONING OF UNITED TERRITORIAL COMMUNITIES AND IDENTIFICATION OF MAIN PROBLEMS OF ORGANIZATIONAL SUPPORT OF LOCAL BUDGET MANAGEMENT

The importance of the study of the united territorial communities functioning and the identification of the main problems of organizational support of local budget management are substantiated. It has been studied that the issues related to the development of organizational support of local budget management are insufficiently researched in the domestic scientific literature. The paper clarifies that the decentralization of government should ensure the democratization of society, combine administrative, political, fiscal decentralization and involves the transformation of the interaction between gov-ernmental agencies and citizens, NGOs and businesses. The regulatory framework for the reform process is provided. Problems o f united territorial communities’ development are identified. One of the first of them is the problem of proper implementation of the territorial community functions, which is intertwined with the filling of the UTC budget, the formation of financial resources sufficient to adequately finance the urgent social needs of communities based on the principle of subsidiarity, implementation of their economic and technological development. Conditions for the formation of able-bodied territorial communities are provided. The own and delegated powers of the united territorial communities in Ukraine are studied. The factors and subjects of ensuring the financial capacity of territorial communities are singled out and generalized. As a result, the well-established interaction of the subjects of financial relations under the influence of both external and internal factors will help meet the legitimate needs and interests of local communities. The basic legislative bases of the mechanism of voluntary association of territorial communities are generalized. It is determined that the current state of local budgets does not seem to be the best, which hinders the complex tasks assigned to local authorities: scarcity of their own sources of income, almost complete dependence on the state budget, lack of transparency of budgetary relations in providing financial assistance from the center, additional assistance revenues and economic expenditure of budget funds. According to the analysis conducted by the authors, a set of problems of organizational support of local budgets is proposed.


INTRODUCTION
In connection with the implementation of the reform of decentralization of public administration, including budget decentralization, much of the powers and responsibilities in the financial and budgetary sphere are transferred «to the places», in particular in the newly created united territorial communities (here in after UTC) and many complex and painful problems in their functioning, the solution of which depends on the overall socio-economic development of our state. The modern concept of public administration is firmly established as a standard form of processes organization and technological support of public administration in Ukraine.
At the same time, issues related to the development of organizational support for local budget management are insufficiently researched in domestic scientific literature. The issues of development of the united territorial communities (UTC) budgets need the systematic research. Current challenges related to decentralization processes and transformation of financial system at all levels necessitate the definition of local budgets role in the implementation of strategic reform goals. The purpose of the article is to determine the functioning of the united territorial communities and to determine the main problems of organizational support of local budget management.

METHODOLOGY AND RESEARCH METHODS
The following modern scientific methods to develop the principles of organizational support of local budget management as dialectical method of cognition (for the formation of theoretical principles of determining the essence of local budgets, organizational support, territorial community); comparative analysis (in order to compare the effectiveness of the formation and implementation of budgets of territorial communities); abstract-logical (for the formation of theoretical generalizations and formulation of research conclusions); graphical visualization (in order to visualize the results of calculations and analysis) were used in the work.

RESULTS
The use of a unified model of decentralization of public administration within local self-government will provide the necessary level of transparency in solving many common problems of regional development in the context of economic liberalization [1].
It was confirmed that the decentralization of government should ensure the democratization of society, combine administrative, political, fiscal decentralization and provide for the transformation of the interaction between government agencies and citizens, NGOs and business [2].
In the current conditions of world globalization, due to the achievements of scientific and technological progress, socioeconomic development of territories determines the increase of their competitiveness at both international and national levels ensuring the social well-being of population. 109 As already mentioned, the practical implementation of decentralization reform began in Ukraine in 2014. The legal framework of the reform process is represented by the following acts (Table 1). The aim of decentralization policy is to move away from the centralized model of governance in the country, ensure the capacity of local self-government and build an effective system of territorial organization of power in Ukraine, fully implement the European Charter of Local Self-Government, the principles of subsidiarity, universality and financial self-sufficiency 2 Agreement on a coalition of European Ukraine parliamentary fractions [4] The main tasks of decentralization and reform of local self-government are: adequate resource provision of local self-government, expansion and consolidation of stable sources of local budgets, granting the right of local self-government bodies to serve local budgets (special fund) in banking institutions, introduction of horizontal system of equalization of local budgets, simplification of local self-government access to credit resources); formation of self-sufficient communities (determination of criteria for the formation of administrative-territorial units of the basic level, introduction of changes in the boundaries of territorial communities) 3 State strategy regional development for 2021-2027 [5] Effective public administration in the field of regional development is defined as one of the three integrated goals, for which the following tasks are envisaged: introduction of a three-tier system of administrative-territorial organization 4 The Concept of Reforming Local Self-Government and Territorial Organization of Power in Ukraine and the Action Plan for the Implementation of the Concept [6] The criterion for forming the basic level of administrative-territorial organization is the level of accessibility of basic public services provided in the community. The main tasks of local government reform are: ensuring the availability and quality of services; formation of a three-level administrative-territorial structure (community -district -region); optimal distribution of powers; creating conditions for local governments to exercise their own and delegated powers 5

Law of Ukraine «On Cooperation of Territorial Communities» [7]
The law defines the mechanism for combining material and financial resources of territorial communities. The main forms of cooperation are: delegation of tasks and resources, joint financing, formation of joint utilities, joint management bodies, implementation of joint projects The mechanism and conditions of formation of capable territorial communities, the order and approval of the perspective plan of formation of territories of communities of areas are defined. The adoption of laws is aimed at increasing the financial base of local self-government and expanding its powers UTC is an administrative-territorial unit in Ukraine, established in accordance with the Law of Ukraine «On Voluntary Association of Territorial Communities» [8]. United communities are formed as a result of voluntary association of adjacent territorial communities of villages, settlements, towns and cities. A united territorial community, the administrative center of which is a city, is an urban territorial community, those the center of which is defined as an urban-type settlementare settlement territorial communities, and ones the center of which is a village -are considered as rural.
One of the first is the problem of proper implementation by the territorial community of its functions, which is intertwined with the filling of the UTC budget, the formation of financial resources sufficient to adequately finance the urgent social needs of communities based on the principle of subsidiarity, their economic, technological and other development. Therefore, UTCs need, firstly, to have real opportunities to form a certain amount of financial resources to be financially viable, and secondly, to have adequate legislative powers as a subject of power, which is the priority of Ukrainian reforms. Local government reform should ensure the ability of local governments to address all local issues independently through their own resources.
It should be noted that, according to experts, the introduction of budget decentralization in terms of expenditures was the most problematic and controversial, because their financing requires an adequate amount of financial resources. The Law of Ukraine «On Local Self-Government in Ukraine» provides for the division of powers of local self-government bodies into their own and delegated ones. Following the separation of functions under the current reform, the following functions are included in the own and delegated powers of local governments, in particular in united territorial communities (UTCs), as presented in Table 2. , the formation of able-bodied territorial communities must be carried out in accordance with the following conditions: ▪ the territory of the community is inseparable, its boundaries are determined by the external boundaries of the united territorial communities; ▪ within the united territorial community there can be no other territorial community that has its own representative body; ▪ the formed community should be located within one region; ▪ the condition of the association should be to ensure the provision of public services of quality not lower than before the association was formed; ▪ the administrative center of the united territorial community must be the settlement located closest to the geographical center of the UTC, and meet the requirements for the appropriate level of infrastructure development; ▪ the accessibility zone of the administrative center of the united community can be at a distance of 20-25 km for the fastest possible provision of public services.
At first glance, local governments, primarily UTCs, have received a list of powers delegated to them. However, ensuring the compliance of the financial resource with the real needs of local budgets in the implementation of expenditures on the entire range of powers delegated by the state required additional transfer funds from the state budget [16][17][18][19][20]. Therefore, in order to eliminate such challenges, a new transfer policy was proposed for the provision of new types of transfers to local budgets: basic subsidy; educational subvention; subventions for the training of workers; medical subvention; subventions for the provision of medical measures of certain state programs and complex measures of a programmatic nature, which in addition to a number of advantages also has negative aspects that also need to be addressed.
There are also problems with the issue of realization of the property right of territorial communities to communal property. First, the mechanism of consolidation of communal property rights has been violated, which does not allow territorial communities to capitalize on resource potential. Secondly, in Ukraine there are no public registers of communal property owned by communities, which is and may be the result of its irrational use, and sometimes illegal alienation.
According to the author, the most positive economic effect for the community should be achieved through the integrated use of certain measures.
Thus, given that the development of the local community depends on the quality and most efficient use of the assets of its own, problems with determining the mechanisms for exercising the powers granted to communities need to be addressed because they directly affect the financial and economic capacity of local communities therefore, have a direct impact on the quality of decentralization.
Given the above, we can consider the financial capacity of local communities as their ability to attract, accumulate and effectively use financial resources from various sources to address pressing issues of local importance [21][22][23][24][25]. Ideally, any community should be financially viable, both united and not yet united, which is able to properly ensure the viability 111 of all actors in financial relations, and their interaction, in order to achieve and support balanced development in all areas in the relevant territory ( Figure 1).

Local governments
Authorities and local governments of higher levels As you can see, Figure 2 presents the main factors and subjects of meeting the legitimate needs and interests of a territorial community. As a result, the well-established interaction of the subjects of financial relations under the influence of both external and internal factors will help meet the legitimate needs and interests of the local community.

SATISFACTION OF NEEDS AND INTERESTS OF THE TERRITORIAL COMMUNITY
Communities united in accordance with the criteria set out in the Law on Voluntary Association of Territorial Communities have the same powers as cities of regional significance (Article 67) Territorial communities that unite by October 15 of the year preceding the planned one will have direct inter-budgetary relations with the state budget starting from the planned budget period (Article 67) Bodies of local self-government in villages, settlements, towns of district significance that have not united are deprived of the right to exercise the powers delegated by the state Local governments have a defined list of powers delegated to them to be performed and also the financial resources needed to exercise such powers According to the Law of Ukraine «On Voluntary Association of Territorial Communities» [8], a specific mechanism of voluntary association of territorial communities, which did not exist before, and which allows to obtain a revenue base and expenditure powers in accordance with the long-term plan of the community, as in cities of regional importance was established (see Figure 2).
The current reform of budget decentralization in Ukraine, taking into account the European experience of such reforms, can be effective in the formation of effective local self-government, especially at its lowest level, i.e. at the level of UTC.
Thus, the scientific novelty of the results of the study is to develop theoretical and practical approaches to the development of local budget management of UTC, which are as follows: ▪ to approve (improve) the Community Development Strategy and determine the priority areas of development; ▪ to form an information database of the community and ensure its effective management; ▪ to improve budget planning (determination of real budget indicators; taking into account the priorities set by the community development strategy); ▪ to determine the optimal number of UTC governing bodies (approval of executive committees taking into account the powers and functional workload); ▪ to complete the process of voluntary association and make it binding; ▪ to legislate and differentiate the powers of district bodies and communities (clear and understandable division of powers is needed, as well as the right of state administrations to monitor the implementation of powers, otherwise UTC representatives will feel impunity).
These proposals will improve the procedure for effective management and implementation of the UTC budget.
In conclusion, it should be noted that the reform of decentralization and the formation of united territorial communities is characterized by the introduction of comprehensive changes in the organization and functioning of local budgets. The main areas of reform are: ▪ change of administrative-territorial structure and formation of united territorial communities, which will allow: first, not to scatter budget funds, but to accumulate them to ensure the development of territorial communities that are part of UTC, for their even distribution among settlements; secondly, to reduce the staff of the administrative apparatus; thirdly, to obtain additional financial resources and powers through the budget system functioning at the level of cities of regional significance.
Therefore, having analyzed the organizational support of local budget management, it is necessary to find out what the problems of organizational support are for their further elimination.
Ukraine is trying to plan the main directions of the budget with the help of the Budget Resolution. The approved budget resolution is a strategic document that defines the direction of public finances on priority reforms. And this will lay the plan for the development of the country's economy for the future and create a basis for deep systemic reforms [26][27][28][29][30]. The new budget resolution calls for a stronger top-down approach to budget planning. That is, the assessment of total resources and the distribution of priority policy areas, taking into account the necessary changes. 113 Thus, we have the next problem of the budget process in Ukraine -the lack of a strategic component in the budget process -the budget is planned for a year, while the strategic development of the state and its components requires long-term financial plans [31-33] As a result, the financial, budgetary and socio-economic strategies of the state are developed in parallel, instead of the necessary coexistence. In fact, the state does not have the capacity to conduct anti-cyclical policies, i.e. balancing deficit and surplus budgets depending on the phase of economic cycle.
Shortcomings in planning lead to a logical result -the actual imbalance of revenues and expenditures, which in Ukraine takes the form of a budget deficit.
The problem is a logical continuation of the theme of organizational support of local budgets which is the ratio of budget and tax legislation.
According to Yu. Hanushchak and E. Zhovtyak [12], the practice of budget formation in Ukraine confirms that tax legislation does not fit well to the budget. Although it is written in the Code that all the laws affecting the revenue or expenditure part must be adopted by mid-August, neither the government nor the deputies are psychologically ready for such rules of the game [12].
One of the main problems of organizational support of local budgets in Ukraine is the imbalance of inter-budgetary relations «state-regions», i.e. the problem of local budgets, their independence and funding.
Unfortunately, the current state of local budgets does not seem to be the best, which hinders the implementation of complex tasks assigned to local authorities: scarcity of their own sources of income, almost complete dependence on the state budget, lack of transparency of budgetary relations in financial assistance from the center, additional assistance revenues and economic expenditure of budget funds [13]. According to the analysis conducted by the authors, the following can be attributed to the complex of problems of organizational support of local budgets (Figure 3).

A SET OF PROBLEMS OF ORGANIZATIONAL SUPPORT OF LOCAL BUDGET MANAGEMENT
Significant dependence of the lower-level local budget on the higher-level budget Transfer policy according to the Budget Code does not take into account changes in the socio-demographic situation of local communities  Gender equality, or rather inequality, is a specific problem for local budgets. Analysts at the Kharkiv City Women's Fund (KHMF) note that there is a number of disparities in the financing of local budgets on the basis of a gender. In particular, boys spend more on education than girls, but at the same time, women receive 40% more than men in the distribution of social assistance [14].
An important problem in the implementation of social programs in the budget process of Ukraine is the inefficiency of the use of funds. S. Pantsir notes that the actual share of expenditures on the administration of social programs is up to 90%, i.e. social policy continues to work for the administrative apparatus but not for those who need a protection.
The problem of inefficient use of funds is largely caused by their misuse. The analysis conducted led to the conclusion that the volume of budget violations and inefficient use of budget funds is growing over time and over the past 10 years has grown almost 8 times [34][35][36]. The most typical violations in the formation of state budget revenues are non-receipt of taxes and fees due to the narrowing of the tax base (55%) and inadequate control of tax and customs authorities (31%).
According to P. Kachur, one of the main problems of organizational support is the lack of responsibility for the outcome of funding. He notes that today it is not the result that is funded, but the function itself.
Another problem with the implementation of the budget process in Ukraine is non-repayment of loans obtained under the guarantees of the Cabinet of Ministers by enterprises. The amount of non-refundable funds has reached several billion hryvnyas and has a steady upward trend. This is due to the ineffectiveness of the mechanism of state guarantees.
An important problem of organization and implementation is the control over budget execution. In Ukraine it is carried out by the Accounting Chamber. However, the current legislation does not fully and clearly prescribe the functions and powers of the Accounting Chamber. In particular, the control function has no effective influence. The Accounting Chamber has no right to impose financial sanctions, administrative penalties on violators of budget legislation. The Accounting Chamber is limited to the obligation to inform the authorities and provide advice. In addition, the control powers of this body do not extend to the level of local budgets, which does not correspond to the status of the Accounting Chamber, which is written in the Law of Ukraine «On the Accounting Chamber» [15].
Analysis of the works of Ukrainian and foreign scholars allowed the author to suggest the following areas of efficiency of the budget process at the local level: to find out if the information is complete for decision making; to ensure the availability of complete information for decision-making; to make a choice of the optimal decision on the inclusion of budget requests in the draft decision on the local budget.

CONCLUSIONS
Thus, the study allowed to determine the range of still unresolved issues in the organization and implementation of the budget process in Ukraine. Problems exist at every stage of the budget process and require immediate solution, which will improve and optimize the use of financial resources of the state.
According to the point of view of the authors, the most positive economic effect for the united territorial community should be achieved through the integrated use of certain measures that were mentioned in the article. It should be noted that the development of the united territorial community depends on the quality and most efficient use of the assets it owns direct impact on the quality of decentralization. For further research on this issue it is necessary to analyze the current state of local budgets.