The Bologna Metropolitan City Equalisation Fund
Practical notebook no. 16: (Re)developing productive activities in metropolitan regions
Thierry Petit, November 2024
The Bologna Metropolitan Strategic Plan affirms the values of ‘hospitality, diversity, fundamental rights, equity’ and a number of guidelines, particularly environmental, for imagining territorial development. With the equalisation fund, the elected representatives are basing their action on a shared awareness, collective mobilisation around a common system of action and new forms of redistribution to propose a more flexible and open approach to development.
To download : bologne_rapport-espaces-eco-ville-3_198_245.pdf (6.1 MiB), cp16_ok_bat_web.pdf (7.3 MiB)
The metropolitan city of Bologna covers 3,700 square kilometres and has a population of around one million. Since the 2014 national law on Italian territorial organisation, which now includes a municipal, metropolitan and regional level, ten metropolises have been created. On this occasion, the metropolitan city of Bologna replaced the province of Bologna, retaining the same perimeter.
In 2017, the Emilia-Romagna Region, which has legislative powers, made it compulsory for the Metropolitan City of Bologna to draw up a territorial metropolitan plan. Initial work began in 2019 and the Territorial Metropolitan Plan was adopted in 2020. It includes the principle of creating a metropolitan equalisation fund. This is intended to finance urban regeneration projects in the poorest, least attractive and least developed municipalities in the metropolis.
The metropolis of Bologna, with 55 municipalities grouped together in seven federations of municipalities, has significant territorial disparities. Among the most affluent, and the most attractive to investors, only eleven municipalities have a low fragility indicator. The fund also aims to help municipalities that are ‘off the market’ to benefit from urban renewal projects, by facilitating access to additional funding (including private funding) for purely public projects. Urban renewal is thus moving from the urban scale to the metropolitan scale. This translates into a limit on urban expansion of up to 3% of the surface area already urbanised by 2050, according to the application of the 2017 regional urban law: only 1% remains at the municipal level, while the other 2% is transferred to the metropolitan level. Applying this criterion means that the rate can be adjusted for each municipality.
This fund, created in 2021, is a first in Italy, and probably in Europe. It is intended to be financially autonomous and independent. As such, half of its income will come from the secondary urban development charges oneri di urbanizzazione generated by urban development operations carried out within the 3% envelope. Funded mainly by the richest municipalities, the difficulty has been to get them to agree to share the resources they derive from the urban renewal that takes place spontaneously on their territory. This opposition was overcome by highlighting the ‘ecosystem’ services provided by the municipalities furthest from the development of the metropolis and the least attractive.
In addition, the extension limit, which now applies to the metropolis rather than the individual municipality, also benefits the most attractive municipalities, as they can now go beyond the calculation of the envelope restricted to their territory alone. The city of Bologna, with its high level of economic fragility, was itself in favour of setting up an equalisation fund, which facilitated its implementation. What’s more, its mayor also holds the presidency of the metropolitan city. For its first year of funding, it had a budget of 2.3 million euros.
Eventually, this fund will be managed by the cité métropolitaine, and the sums deposited will be available for the metropolitan regeneration programme without any time limit. The main selection criterion is the economic or social vulnerability of the area concerned (municipality or group of municipalities), which accounts for half of the project’s score, with an additional bonus if the project involves a group of municipalities. The criteria also cover the metropolitan interest of the project. One of the objectives of the fund is to increase the number of renewal initiatives in these areas by setting up a portfolio of projects, which will be submitted year after year to calls for projects. To achieve this, local working groups, called Officine di Rigenerazione Metropolitana (ORMe), have been set up with technical staff from the Metropolitan City Council and the municipalities, to identify sites and propose actions to be carried out there.
The fund covers the financing of upstream studies right through to the work involved in carrying out the renewal operations. The areas covered include biodiversity and ecosystems, agriculture, tourism, renewable energy, brownfield redevelopment and the renewal of business sites, including those in difficulty, such as those in the Alps. Studies into renewable energy projects have been launched in 2022 (including the first AAP in June 2023), thanks to the €700,000 equalisation fund.
Factors for success/points of vigilance
A central town that is the driving force behind the implementation of this fund, despite the reluctance of some of the richest municipalities. A long tradition of inter-municipal cooperation, dating back to 1995 when the metropolis was still a province, which has facilitated the consultation process and the consideration of metropolitan issues. The metropolitan city was subsequently entrusted with planning powers by the Region. Strong leadership from the Metropolis, which has been able to attract the support of other municipalities and groupings. A solid engineering team capable of setting up and managing the fund.