With the ten-page draft for an appointment resolution, the CDU and FDP want to go far beyond the fault of building councilor Schmidt. The two opposition groups are also targeting four members of the government: Senator for Finance Matthias Kollatz, Senator for Interior Andreas Geisel (both SPD), Senator for Economics Ramona Pop (Greens) and Senator for Construction Sebastian Scheel (left).
Kollatz, Pop and especially Scheel, as the former Secretary of State for Construction, are suspected of trying to save the “These EG” from bankruptcy and the pre-emptive practice under red-red-green from a disaster with tax money, interventions in funding requirements and adapted analyzes of economic efficiency.
But the Union and Liberals are also concerned with the rent cap enforced by the coalition. Only a week ago, a requirement of the rent cap took effect, as a result of which the rent would have to be reduced for around 340,000 households. However, according to a letter to the tenants last Thursday, Die eG sees no reason to comply with the rent cap and lower the rent.
When the Senate granted the financial aid for Die eG, rents above the rent cap had been approved in advance – otherwise it would not have been possible to finance the pre-sale and the rental houses. In order to save the pre-emptive project, according to Tagesspiegel information, it was already calculated before the rent cap was decided that this would have to be circumvented at Die eG.
Even before the House of Representatives passed the law at the end of January, the Senate itself had checked the economic viability of the real estate acquired by Die eG in advance. Although the details of the rent cap were already clear and politically wanted by the Senate itself, rent increases of two percent per year have apparently been approved. Otherwise, so the result of the audit, the business model of the cooperative would not have been sustainable.
Opposition sees joint responsibility for the Senate
The investigative committee is politically risky on this point because the red-red-green rent cap could be overturned by the Federal Constitutional Court in Karlsruhe in the first half of 2021. The CDU parliamentary group has already approved the draft resolution for the committee of inquiry, the FDP parliamentary group wants to deal with it on Tuesday.
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The cumbersome title of the draft resolution reads: Establishment of a “committee of inquiry to clarify the causes, consequences and responsibility for financial risks of the State of Berlin in connection with speculative real estate transactions of ‘Die eG’ and their public funding”.
Stefan Evers, parliamentary manager of the CDU parliamentary group in Berlin, said on Sunday evening: “This is about millions of taxpayers’ money for dubious real estate transactions that are the subject of criminal investigations and audits by the Court of Auditors.” the “shared responsibility of parts of the Senate”.
FDP parliamentary group leader Sebastian Czaja said his group did not see “this parliamentary committee of inquiry as an election campaign instrument”. Nevertheless, the committee should “draw a holistic picture of the scandalous events in the Friedrichshain-Kreuzberg district”.
According to the will of the CDU and FDP, the committee of inquiry should present its results by the end of August. The election to the House of Representatives is expected in September 2021.
The schedule is likely to be correspondingly tight and it would be an additional burden for the groups. The inquiry drafted by the CDU and FDP contains more than 70 questions plus sub-questions. It would be the fourth House of Representatives Committee of Inquiry in this parliamentary term.
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There are already three committees of inquiry – on BER airport, on the failure of the authorities in the case of the Islamist attacker Anis Amri and on the release of Hubert’s boy as head of the Stasi victims’ memorial as a result of allegations of sexism.
Some facts are already on the table in the “Die EG” affair. The public prosecutor’s office has been investigating Friedrichshain-Kreuzberg’s building councilor Schmidt since May on suspicion of budget infidelity. The reason is the circumstances of the pre-purchase of several rental houses in the district in favor of Die eG. The question is whether Schmidt illegally wasted finances at the expense of taxpayers and took budgetary risks.
In the meantime, the public prosecutor’s office is checking after criminal charges whether they are also initiating investigations against building senator Scheel, district mayor Monika Herrmann (Greens) and interior senator Andreas Geisel (SPD). A spokeswoman for the prosecutor told the Tagesspiegel. Possible allegations are infidelity as well as inciting and aiding and abetting infidelity.
Geisel is about the action of the district supervisor based in the interior administration, which also checks the processes in the Friedrichshain-Kreuzberg district office, but could even have averted the affair if it had intervened earlier, is the suspicion.
At the beginning of October, the State Audit Office reprimanded Schmidt’s actions. The top state auditors came to a devastating verdict in their annual report. The Court of Auditors accuses Schmidt of “improperly exercising pre-emptive rights”. As the district has asserted its right of first refusal on six residential buildings, Friedrichshain-Kreuzberg is jointly and severally liable in the amount of 27 million euros. The district also incurred payment obligations of EUR 270,000.
The district office had insufficiently checked the cooperative’s financial performance and thus violated the building code, according to the annual report. For one of the six properties, the district office did not have sufficient information about financing commitments or the performance of the cooperative in general.
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In five cases, the district office exercised the right of first refusal, although the cooperative had already provided for a subsidy from the state in its financial plan, for which there was no legal basis at all. At that time, the main committee of the House of Representatives had not even decided on any funding for cooperatives for advance purchases.
“This eG”, founded in the early summer of 2019, had taken over financially by buying several houses, six in Friedrichshain-Kreuzberg and one in Tempelhof, and was facing bankruptcy at the end of 2019.
The pre-sale was secured with more than 20 million euros
Although the cooperative was not yet able to provide viable financing, such as planning state funds without a binding commitment, it was awarded the contract. In addition, when the right of first refusal was drawn in both districts, it was still in the process of being established and therefore not yet legally competent. Even state-owned housing companies had refused to buy the property because of the lack of profitability.
In the end, “Die eG” did not have the money to transfer the sums due for two houses, in one case another cooperative had to step in. Finally, the Senate set up a funding guideline for cooperatives so that they can be financially supported with the right of first refusal – it was a Lex “This eG”.
The Senate also exerted further influence. The guidelines have been softened for grants from the state and loans from the IBB development bank. It is about more than 20 million euros to secure the district preemptive cases.
In view of the cooperative’s finances, IBB did not want to pump any money into the project. Then, under pressure from the Senate, the funding was tailored to the cooperative, including Senator for Finance Kollatz, Senator for Economics Pop and Senator for Construction Scheel.