50% Reduction in Local Government Shared Property Rent in Employment Disaster and Industrial Crisis Areas

Partial Amendment to the Enforcement Decree of the
Act on Public Property and Goods Management Passed at the Cabinet Meeting
Reducing Resident Burden through Usage and Lease Fee Adjustments ... Supporting Job Creation

[Asia Economy Reporter Jo In-kyung] To revitalize local economies struggling due to the spread of the novel coronavirus infection (COVID-19), measures are being promoted to reduce or allow installment payments of rental fees for public properties owned by local governments.

The Ministry of the Interior and Safety announced that the partial amendment to the Enforcement Decree of the Act on the Management of Public Property and Goods passed the Cabinet meeting on the 15th.

The amendment first allows up to a 50% reduction in rental fees when leasing public property in areas designated as employment disaster zones and special industrial crisis response zones to encourage active economic activities using public property in regions experiencing economic downturn.

In particular, in addition to the temporary rent reduction for disaster victims implemented through the amendment in March, further support is now possible, such as extending the payment deadline up to one year and reducing late fees by up to 50% if the rent cannot be paid.

Measures have also been prepared to ease the difficulties faced by small business owners, self-employed individuals, and local small and medium-sized enterprises suffering from prolonged disasters affecting their livelihoods and business operations.

If tenants of public property are unable to use the property due to local government facility construction or other reasons, previously only lease period extensions were allowed, but now rent reductions are also possible, expanding user options. Additionally, for annual rents exceeding 1 million KRW, the number of installment payments allowed has been increased from four to six times, and if annual rent increases due to factors such as official land price hikes, the rent increase is capped at 5% compared to the previous year to alleviate the burden of sudden rent hikes.

Support measures for companies contributing to local economic revitalization, such as overcoming local employment crises and encouraging youth settlement in the region, have also been expanded and newly established.

When a "local job-creating company" that attracts factories, research, or cultural facilities and employs more than 10 local residents on a regular basis leases public property through bidding, it can receive benefits such as permanent facility construction, long-term leases, and rent reductions, similar to private contract leases. Furthermore, "youth-friendly small and strong enterprises" with youth-friendly working conditions can now receive private contract leases and rent reductions.

Park Jae-min, Director of the Local Finance and Economy Division at the Ministry of the Interior and Safety, said, "This amendment to the Enforcement Decree of the Public Property Act was prepared to lay the foundation for revitalizing the local economy and to alleviate the suffering of local residents facing difficulties due to disasters such as COVID-19." He added, "The Ministry of the Interior and Safety will provide wholehearted support for the rapid recovery of the depressed local economy, and we ask local governments to do their best to ensure that these support measures are utilized effectively on the ground."

This content was produced with the assistance of AI translation services.