In March last year Daugavpils satiksmes (Daugavpils Transport), the municipal transport company signed an agreement with the Central Finance and Contracting Agency for the implementation of the project "Development of Green Public Transport in Daugavpils City".
The project envisages continuing development of Daugavpils city tram infrastructure by investing both in the reconstruction of existing tram lines and in the construction of a new branch, and in the purchase of eight new trams. The project is scheduled to be completed by 31 December 2019, with a total cost of nearly 16 million euros. But the project is stuck in a siding.
"The essence of the problem is the fact that there is still no harmonization of one landowner in the master plan," says Romans Savickis, board member of Daugavpils, who says that though it is planned that a necessary land purchase can be made, until that is done the construction work cannot proceed.
The commencement of construction works has already been delayed by five months, which could jeopardize the realization of this project and the acquisition of European funds.
"The risk exists... But we will do everything to prevent it," said Savickis.
The delay centers on a small but crucial plot of land just 0.7 hectares in size which was included in the design plans despite the fact that agreement had not been reached with the current landowner, who is offering to sell for a price of 70,000 euros, which officials say is far above the market rate.
Compulsory purchase is an option, but that would require taking the matter via Latvia's parliament, the Saeima, and would be likely to take two years or more to complete. Another option would be to re-designs and re-submit the project - which would also be a lengthy and probably just as expensive option. Faced with that choice, the authorities have decided buying the land at the inflated price would be the least harmful option.
But nor is that the only over-run on the project the Head of the City Economy Committee, the "Latgale Party" Representative Janis Lāčplēsis, who said:
"The difference between the construction estimate and the contract for the construction of the new tramway is about 2 million. In addition, there are such miracles that construction supervision is half the cost of developing the technical project itself."
The extra hit the municipal budget will take as a result of the bad planning and implementation of the project could find its way into the pockets of travellers using the municipal transport system. It should be noted that public transport in Daugavpils is among the cheapest in the country, with tickets for trams and city buses costing just 43 cents and with students and pensioners traveling for free. Yet Daugavpils is also in one of the most economically depressed areas of the country and cheap public transport is a crucial part of the local economy.