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43. Federal Compensation Fund
The legal basis for the creation of the Federal Compensation Fund is established by Art. 133 BK RF.
Federal Compensation Fund is formed as part of the federal budget in order to provide subventions for the fulfillment of expenditure obligations of constituent entities of the Russian Federation or municipalities, the financial support of which in accordance with the Federal Law of October 6, 1999 No. authorities of the constituent entities of the Russian Federation" or Federal Law No. 184-FZ of October 6, 2003 "On the General Principles of Organization of Local Self-Government in the Russian Federation" is carried out at the expense of subventions from the federal budget. Subventions from the Fund are distributed among the subjects of the Russian Federation in accordance with the methodology approved by the Government of the Russian Federation.
The total volume of the Fund and its distribution by types of expenditure commitments, as well as the distribution of subventions from the Fund between the constituent entities of the Russian Federation are approved by the federal law on the federal budget for the next financial year when it is considered in the third reading.
Subventions from the Fund are credited to the budget of a constituent entity of the Russian Federation and spent in the manner prescribed by federal laws and regulatory legal acts of the Government of the Russian Federation adopted in accordance with them.
Subventions from the Fund for the fulfillment of certain expenditure obligations of municipalities are provided to local budgets through regional compensation funds formed as part of the budgets of the constituent entities of the Russian Federation and are spent in the manner established by federal laws, regulatory legal acts of the Government of the Russian Federation and regulatory legal acts of the constituent entities of the Russian Federation.
Subventions from the Fund are distributed among all constituent entities of the Russian Federation according to a methodology that is uniform for the corresponding type of subventions in proportion to the population, consumers of relevant budgetary services, persons entitled to receive transfers to the population, and other indicators, taking into account objective conditions that affect the cost of providing budgetary services. When distributing subventions from the Fund, the use of indicators characterizing the own revenues of the budgets of the constituent entities of the Russian Federation or local budgets is not allowed.
The methodology for distributing subventions from the Fund is presented by the Government of the Russian Federation as part of documents and materials submitted to the State Duma simultaneously with the draft federal law on the federal budget.
The procedure for transferring subventions from the Fund to the budgets of the constituent entities of the Russian Federation is established by the federal law on the federal budget for the next financial year or by a regulatory legal act of the Government of the Russian Federation adopted in accordance with it. The expenditure of subventions provided from the Fund is carried out through accounts opened with the Federal Treasury.
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