On February 18, 2020 the Gazit-Globe Real Estate Institute held a roundtable discussion on the subject “The Israeli Blanket Agreements Ahead of a New Decade.” The meeting was moderated by Dr. Efrat Tolkowsky, CEO of the Gazit-Globe Real Estate Institute, Daniela Paz Erez, founder and CEO of Paz Economy and Engineering, and Arik Mirovsky, senior commentator and journalist at Globes. During the meeting, the participants discussed the challenges and complexities posed by the blanket agreements (Heskemei Gag) in Israel.
Among the speakers at the roundtable session were: Ariel Yotzer, deputy budget commissioner for Real Estate and Local Government at the Ministry of Finance; Adiel Shimron, director of the Israel Land Authority; Binyamin Dreyfus, director-general of the Ministry of Construction and Housing; Edith Bar, deputy director-general of the Ministry of the Interior and director of Development at the Local Authorities; Aviram Dahari, mayor of Kiryat Gat; Carmel Shama HaCohen, mayor of Ramat Gan; Yaela Maklis, mayor of Yehud-Monosson; Shalom Ben Moshe, mayor of Rosh Ha’ayin, and Nissim Gozlan, head of the Be’er Ya’akov Local Council.
Daniela Paz Erez, founder and CEO of Paz Economy and Engineering, began the meeting by presenting an overview of the blanket agreements in Israel and said: “We just finished a decade with very challenging land marketing, and there was an attempt to solve the complexity using the mechanism of the blanket agreements.”
Edith Bar, deputy director-general of the Ministry of the Interior and director of Development at the Local Authorities, addressed the issue of the economic resilience of the municipal authority, saying: “We need to think from the outset about the municipal resilience of an authority. If the blanket agreement really happens, what is the appropriate rate of increase in housing versus the rate of increase in employment?” Bar added: “We have built an economic model that examines whether there is an expected deficit and what it is. It is known that additional housing units involves a deficit, and in some of the authorities we are very concerned about this.”
Dr. Efrat Tolkowsky, CEO of the Gazit-Globe Real Estate Institute, described the patterns of the concentration of places of employment and said: "If we create employment areas, there won’t necessarily be workers there. The creation of employment is not relevant to all authorities.” Tolkowsky also mentioned the burden on local authorities in budgeting for education: “If the state took responsibility for the budgeting of education, the situation would be much better.”
Aviram Dahari, the mayor of Kiryat Gat, where the first blanket agreement was signed, told participants: “From being a city that marketed 100 apartments a year for many years, thanks to the agreement we reached 7,600 units that were marketed in three years. But then you come to the Ministry of Education and say, ‘I have a blanket agreement with the Treasury, I am supposed to get six elementary schools, three high schools, and fifty-five kindergartens. And they tell me ‘Do you want to finish our entire annual budget?’” He said that he received a similar response from the Ministry of Welfare, and that Netivei Israel, the National Transport Infrastructure Company, has not planned to build interchanges in a timely manner. On the other hand, he noted that the developers are asking him to promote the development, “and I know that if I give building permits, I am misleading banks and customers who have bought apartments because the whole agreement is built on statutory things that do not exist.”
Shalom Ben Moshe, mayor of Rosh Ha’ayin, stressed that transportation, employment and educational conditions must be met, defining this as the most effective factor in the agreement being fulfilled.
Nissim Gozlan, head of the Be’er Ya’akov Local Council, described the uncertainty he dealt with in the field of transportation: "There is uncertainty with regards to transportation. I cannot be told that the Brown Line is an integral part of the plan, when there is no way of knowing whether it will be built. The next day they want to meet with me about planning the metro. When it comes to the planning, the right hand doesn’t seem to know what the left hand is doing.” Gozlan also addressed the challenges in education, saying: “I have grown from four kindergartens to 96 kindergarten classes, from an elementary school of two first grades with 44 students to 930 students going into first grade this year. If all of the government ministries do not sit together and join hands, we will not fulfill our mission.”
Carmel Shama HaCohen, the mayor of Ramat Gan, said during the discussion: "We created a good agreement; we were the last to sign the agreement.” In his opinion, there is no single blanket agreement that is suitable for all cities – rather, the agreement must be adapted to each city.
Ariel Yotzer, deputy budget commissioner for Real Estate and Local Government at the Ministry of Finance, commented on the mechanism of the blanket agreements, saying, "The blanket agreements are excellent and should be examined in relation to the alternative. Once upon a time, we used to talk about the targeted marketing of 500 housing units. This method has transitioned to a commitment to larger markets and at a faster pace.” Yotzer went on to argue that the authorities in the periphery finding it difficult to populate the employment areas should be provided assistance, and that a mechanism should be created that would help the municipal authority absorb residents without seeing them as a deficit cost.
Binyamin Dreyfus, director-general of the Ministry of Construction and Housing, stressed that the municipal authorities in the periphery need more resources than the authorities in the center of the country, saying: "If you look at the next decade, you need to differentiate between a blanket agreement in the country’s center and an authority in the periphery.”
Adiel Shimron, director of the Israel Land Authority, said at the discussion’s conclusion that some of the authorities are facing a problematic municipal economy and insufficient property taxes. Shimron recommended not establishing additional inclusive bodies, but rather strengthening the activities of government ministries.
