The paper researches some aspects of regulative maintenance of investment activity in Ukraine and at the level of territories (on the example of Lviv) in the condition of reforming local governments. The author suggests his interpretation of “an investment capacity of a territorial community”. The specifics of managing the investment activity of territories is outlined, and the groups of needs of local governments, the realization of which is the ground for territorial communities’ activity, are defined. The sources of funding of local governments’ investment needs are characterized. The scheme of balancing investment needs and investment opportunities (sources) as a component of management of a territory’s investment activity is suggested. The conditions of securing positive consequences of the process are examined. The analysis of directions of state support of economic and social development of territories in 2020 shows that regional development programs are funded at 12.7%, while other social, environmental, and innovative directions – at a level less than 5%. The paper emphasizes the need of local governments to independently search for ways to implement socio-cultural projects by efficient use of their investment resources and capacity. For a general analysis of investment activity, the investment in the socio-economic development of Lvivska oblast in 2017-2019 is analyzed. The growing volumes of capital investment and the prevailing share of investment in the purchase of machines and equipment are emphasized. The conclusion on insufficient growth of rural areas’ capacity is made. The problems in the attraction of investment in the economies of cities and consolidated territorial communities are defined. The solution of these problems will contribute to the implementation of new approaches to investment activity at the territories of local communities from the viewpoint of the need to secure their financial capacity and sustainable development of settlements. 

regulative maintenance of investment activity, investment needs, investment opportunities, local government, consolidated territorial community 

Ukraine is a unitary state, yet historically various regions, oblasts, districts, and local areas have different levels of economic development. To secure sustainable economic and social development and provide social services guaranteed by the state for each citizen according to the Constitution, the mechanism of redistribution between revenues and expenditures of oblasts, regions, and territories through the budgets of a higher level is used. The paper aims to research the peculiarities of improving interbudgetary relations in conditions of authorities’ decentralization. The paper defines the nature of interbudgetary relations. The basic and reverse subsidies to Ukraine and Lvivska oblast are analyzed. The advantages and disadvantages the communities face at changing approaches to balancing local budgets are determined. Regulative documents that cover the interbudgetary relations in Ukraine are analyzed. Special attention is paid to the problem of local finances reforming, including the development of interbudgetary relations. The scheme of the economic interbudgetary relations system in Ukraine is developed. The ways to improve the system of interbudgetary relations in Ukraine are suggested. The negative and positive aspects, advantages, and disadvantages of the system of interbudgetary relations in Ukraine require the following improvements. 1. It is necessary to avoid the complete budget alignment in the process of budgets balancing by interbudgetary transfers as the major objective. 2. The interbudgetary transfers should be distributed based on a formal approach. 3. The changes have to be introduced to the calculation of medical and educational subsidies in terms of financial standard of budget provision to avoid the money deficit for coverage of necessary expenditures. 4. There is a need to improve interbudgetary relations at the levels of districts, villages, towns, and cities of district subordination. 5. Improvement of the mechanism of targeted benefits provision, their real evaluation, and control for the use of funds. 

authorities’ decentralization, territorial communities, interbudgetary relations, financial resources 

Modern period of Ukrainian development is characterized by extended process of local governance and administrative-financial decentralization reforms, as well as a set of sectoral reforms that started in 2014. The process, which can generally be characterized as the decentralization process, has become the driving force directed at improving the level of territories’ socio-economic development and strengthening the local governance capacity in Ukraine. It is grounded on growing financial autonomy of local authorities, expansion of the list and improving quality of public services granted to residents, and meeting the needs of territorial communities in all activity domains. The paper aims to examine the process of financial decentralization as a precondition of increasing the capacity of local governance in Ukraine. The paper determines that local finances are the process of making financial and investment decisions according to the planned tasks and sources of maintenance. It reveals that the sources of financial provision of territorial communities stipulate the forming of local budgets’ revenues in time based on real processes. The approach contributes to avoiding the excessive expenses and more distinct but rather short-term predicting of budgets composition, as well as optimal defining of funding priorities for corresponding activities. The structure of funding sources in Ukraine is analyzed. The weight of local budgets’ revenues in the structure of Ukraine’s consolidated budget in 2014-2018 is determined. The fact that financial decentralization as one of the key reforms is directed at strengthening of financial-economic capacity of territorial units based on the principles of autonomy, self-sufficiency, and efficiency is emphasized. 

local governance, reform, territorial communities, financial-investment provision, financial resources 

Reforming of the system of local governance and administrative and territorial structure in Ukraine aims to create the new powerful ground for territorial development. It is about the redistribution of functions in the sphere of public governance, deconcentration and decentralization of liabilities between the state and local authorities and budget decentralization. Current market economy conditions and consolidation of financially incapable territorial communities generate qualitatively new administrative and territorial units – consolidated territorial communities, which merge the economic capacities, creating opportunities for newly created local governments to solve more complicated socio-economic development tasks. However, even in case of absence of own sources to finance territorial development and poor development of productive forces at the territory of a community, it is able to activate financial processes by foreign investment. The reform of local governance in this context opens new opportunities for local governments to attract additional funding through extension of their functions in the sphere of territorial organization of economic processes and development of community’s economic capacity. Therefore, the issue of forming and management of territorial community’s investment capacity as the component of its economic capacity through creation of favourable internal conditions in a community to attract investment becomes of utmost importance. The paper aims to analyze the mechanisms of the endogenous factors’ influence on activation of the use of territorial communities’ investment-innovation capacity in Ukraine in conditions of local governance reform. The mechanisms of the endogenous factors’ influence on activation of the use of territorial communities’ investment-innovation capacity in Ukraine in conditions of local governance reform. The nature of investment capacity is outlined. Endogenous factors of forming and use of territorial community’s innovation capacity are defined. Main indicators of endogenous factors of forming and development of territorial community’s investment are specified. The regions are divided by the share of foreign investment in the period of administrative and territorial reform. 

endogenous factors, investment, innovations, local governance reform, territorial communities