OREANDA-NEWS. On 15 April 2008 was announced, that in the Nizhni Novgorod Kremlin, United Metallurgical Company, the Government of the Nizhni Novgorod Region and the Administration of the Vyksa District (Vyksa is home to Vyksa Steel Works (VSW), part of OMK) signed a tripartite cooperation agreement. The agreement specifies that several high priority social measures for the Vyksa District have become part of the regional purpose-oriented programs (RPP) on a co-financing basis (20% from the municipal budget and 80% from the regional budget). Their implementation will depend on the achievement by VSW of its planned tax results (profit tax, individual income tax, property tax, etc.).

The agreement term is three years. The previous tripartite agreement was adopted a year ago and specified that 50% of the profit taxes generated by the OMK companies in excess of their planned figures was supposed to be paid to the Vyksa District budget. Over the past three years, VSW’s tax payments to the budget of the Nizhni Novgorod Region were as follows: 707 million rubles in 2005, 1.7 billion rubles in 2006, and 3.3 billion rubles in 2007. Such a high increase was due to OMK’s large-scale investment program implemented at VSW.

"Such a significant growth was achieved primarily due to the favorable investment climate in the Volga Federal District and the Nizhni Novgorod Region, the personal credit for which can be attributed to Alexander Konovalov, Presidential Plenipotentiary Envoy to the Volga Federal District, and Valery Shantsev, Governor of the Nizhni Novgorod Region," emphasized Anatoly Sedykh, Chairman of the OMK Board of Directors, in his speech at the signing ceremony.

In 2007, OMK paid 1.1 billion rubles for the Vyksa District social programs. The money was spent on the development of infrastructure in Vyksa and the city's redevelopment. They reconstruction program included the Metallurgists' Palace, a recreation center for metallurgists, and a historical museum, The Batashevs' House. In addition, they built a new hotel and new residential houses for VSW employees and those of the Foundry and Rolling Facility, whose construction is in progress. There are several important social projects implemented at present, including the construction of a sport and recreation center, a swimming pool, and a bus terminal.

"The future depends on such companies, as they stimulate the tax base development, the development of social infrastructure, and the creation of new jobs. I'm happy that there are companies that are responsive to the needs and expectations of our region. And OMK is a demonstrative example of such civilized entities. Even though it makes colossal investments in its production development, OMK goes for agreements that lead to the tax base development. A lot has been done in Vyksa to improve the environment for its residents. And other large companies are beginning to follow the example set by OMK," said Governor of the Nizhni Novgorod Region Mr. Shantsev.

"We're looking at Russia's first positive experience in trilateral cooperation that benefits all – a region, a municipality, and a company," emphasized Mr. Sedykh. "However, we're not going to stop there. We intend to increase our allocations for social projects to be implemented in Vyksa in the immediate future.  This, to a large extent, is the result of OMK's large-scale investment policy for the Vyksa District. The Company is now implementing several major projects for a total of over 75 billion rubles, including the construction of the Foundry and Rolling Facility and Mill-5000, the modernization of facilities for the production of medium- and large-diameter pipes, and some other projects."