Green Light for 'Osan Urban Development Corporation' Establishment

[Suwon Ilbo = Reporter Lee Su-won] The green light has been turned on for the establishment of Osan Urban Development Corporation.

This follows the Osan City Council passing a resolution on the organizational change of the Osan Facilities Management Corporation, the establishment and operation ordinance of Osan Urban Development Corporation, and the abolishment ordinance of the Osan Facilities Management Corporation at the second plenary session of the 285th regular session.

With this, following the passage of a capital investment agreement of 9.9 billion won for Osan Urban Development Corporation at the third plenary session of the 281st regular session of the Osan City Council held at the end of last year, the remaining three ordinance and agreement bills have been processed, effectively completing the legal procedures for the establishment of Osan Urban Development Corporation.

Mayor Lee Kwon-jae summarized the three objectives for converting Osan's Facilities Management Corporation to an urban development corporation, which he has been pursuing for the past two years since the start of the eighth popular election term.

△Prevention of haphazard development through systematic urban development △Securing principal authority and public interest in development projects △Maximization of public share of development profits and reinvestment of revenues in the region are the goals.

Following the processing of the ordinance and agreement bills, the mayor stated, "I express my gratitude to Council Chairman Sung Kil-yong and council members who united their will through collaborative governance for the establishment of an urban development corporation to systematically pursue a self-reliant 500,000-population connected city," and pledged "We will expedite administration to launch Osan Urban Development Corporation as soon as possible."

With the completion of legal procedures for the establishment of Osan Urban Development Corporation, we examine the process of converting to a corporation and the future business direction of the urban development corporation.

■ Launch as Hybrid-Type Urban Development Corporation with Both Corporation and Agency Functions

Osan Urban Development Corporation is scheduled to launch as a hybrid-type urban development corporation combining the functions of the existing Facilities Management Corporation and urban development corporation.

Accordingly, entrusted projects previously conducted by the Osan Facilities Management Corporation, such as operation of sports facilities and public parking lots, and garbage volume-rate bag sales business, will continue as before.

In addition, taking advantage of the characteristics of an urban development corporation, the corporation plans to participate in projects initially through undertaking construction work or receiving transfers of planned development projects.

Participation in construction undertaking projects is a method of securing initial capital by delegating authority for detailed design, bidding, ground breaking, supervision, completion, construction project management, and civil complaints related to public architecture and infrastructure expansion and renovation within the city.

Regarding organization and personnel, while maintaining the existing Facilities Management Corporation workforce to ensure smooth execution of initial projects including the Unam-tteul Urban Development Project and construction undertaking projects, the corporation plans to start with a development project team of 6 members including 3 dispatched city employees.

■ Preparation for First Project 'Unam-tteul AI City Project' Progressing Smoothly

Regarding the 'Unam-tteul AI City Project,' which will be the urban development corporation's first project, the city's equity stake will be rapidly transferred to the corporation.

According to the Local Public Enterprise Act (Enforcement Decree Article 47-2), for a corporation to participate in a project, it must have capital equivalent to 10 percent of the investment amount.

The city's equity stake in the Unam-tteul AI City project is evaluated at 19.8%, or 990 million won, so the corporation must secure 9.9 billion won in capital, which has already been approved by the city council at the end of last year, allowing for rapid transfer of equity.

Mayor Lee has consistently discussed the prevention of external outflow of development profits from the initial stages of the corporation's establishment and the goal of increasing public interest, demonstrating his commitment to securing the relevant equity stake.

The profits gained under the Facilities Management Corporation system will be much greater, and the profits will be entirely reinvested for Osan citizens—this is the crux of Mayor Lee's theory on Osan's role as a catalyst for development.

The mayor anticipates that if the urban development corporation increases the possibility of participating in large-scale projects such as semiconductor parts and materials industrial complex development, redevelopment and reconstruction projects in aging downtown areas and apartments, and new public facility construction, the corporation will certainly succeed.

The mayor considers expanding the foundation for Osan Urban Development Corporation to participate in large-scale projects such as the Segyo 1st District terminal site development project, the Naesanmi-dong reserve land development project, and the reserve forces training facility relocation site development project as follow-up measures.

■ Issue Shows Support Rate Approaching 80%... Bipartisan Cooperation Honors Public Mandate

The establishment of the urban development corporation was an issue that recorded support approaching 80% in citizen opinion surveys.

Previously, the city conducted a public opinion survey among citizens during the feasibility study for converting the Osan Facilities Management Corporation to an urban development corporation in February last year, and the survey showed an overwhelming 79.4% in favor of conversion to an urban development corporation.

The most common reason for supporting conversion to an urban development corporation was the possibility of implementing development projects suited to current issues at 35.9%, followed by △promoting regional balanced development (26.5%) △profits from development projects and reinvestment (19.4%) △revitalizing local economy (18.2%).

The reason an urban development corporation is necessary is that when projects proceed primarily through private developers, public interest may be lacking and a situation focused only on development profits may occur. Furthermore, there is the advantage of maximizing public equity share in development projects and leading to reinvestment within the region.

Following the voice and aspirations of citizens, positive evaluations have continued both inside and outside the local political circles regarding the processing of this agenda through bipartisan cooperation.

Mayor Lee Kwon-jae stated, "Since citizens have expressed their wishes and bipartisan cooperation has led to the establishment of the urban development corporation, I will actively ensure that a sound urban development corporation is launched," and pledged, "I will manage and oversee to ensure that concerns about mismanagement and financial waste due to negligent management do not become reality."