Who lost out on?, The mayor sentenced the 3000 acre unfinished project to 9 and a half years for Huan Park | Zhigao | unfinished project

Attracting foreign investors to establish factories and promote local economic development through investment attraction is a common and effective practice in many places.

However, in Huainan, Anhui, a investment attraction project claiming to have invested 10 billion yuan and planned to cover an area of 3200 acres ultimately became a abandoned project, and it has been suspended for more than ten years. The "Focus Interview" program aired on May 9th conducted an investigation and report on the reasons behind the failure of this "celebrity project".

The animation industry park with a claimed investment of billions of yuan

But now it's a unfinished project

Anhui Huainan was once known as the energy capital of China, and the local fiscal revenue was previously highly dependent on coal. In recent years, due to resource depletion, environmental protection, safety and other reasons, Huainan has closed a large number of small and medium-sized coal mines, causing a huge impact on the economy. In 2010, a project called Zhigao Cultural Technology Animation Industry Park was introduced to Huainan as a new economic growth point.

According to the contract signed between the Huainan Municipal Government and Shandong Taian Zhigao Group at that time, the total investment of the project was 10 billion yuan, with a planned area of 3200 acres.

The entire industrial park includes three parts: theme park, animation technology research and development base and trading park, and supporting commercial and residential land. Although it is called the Animation Industry Park, the area directly related to the animation industry only covers 200 acres. Even if we include the 1000 acres of the theme park, it only covers 1200 acres. The largest part is the supporting commercial and residential land of 2000 acres.

Research and development base sales office

The former "star project" has become a abandoned project

The industrial park broke ground in March 2010 and was originally planned to open on November 11, 2011.

However, when the reporter recently arrived here, he found that the office building had become a sales office, and the so-called animation research and development base had not been used for animation research and development for a day.

In addition to the transformation of the animation base into a sales office, Taian Zhigao Group's promise in the contract to become a top-notch Huainan Cultural and Technological Animation Industrial Park and a large commercial center in China is now a dilapidated scene.

The "Huainan Eye" in the park is known as the tallest mountain Ferris wheel in Asia, with a diameter of 120 meters and a height of 168 meters, equivalent to 55 floors. But after more than a decade of exposure to sunlight and rain, it has already rusted and become a dangerous entertainment facility.

Although the Happy Valley now looks dilapidated, 13 years ago it was a local celebrity project, with unlimited glory for a time. Happy Park even claims to become the third largest tourist destination in Anhui province.

In 2011, Cao Yong, then Mayor of Huainan City, met with Jiang Dongting, Chairman of the Board of Directors of Zhigao Group, at a hotel and stated that the Huainan Municipal Party Committee and Government would fully support the construction of the project to ensure the grand opening of the Happy Park as planned. When reviewing the government work report of Huainan City from 2010 to 2013, the reporter also found that this project is one of the key contents of government work every year.

Li Yuecheng, President of Huainan Zhigao Group Co., Ltd., said in an interview that the total investment in the Shenzhou Joy Park Park was 3 billion yuan, and 90% of the investment has been completed. The plan is to conduct a trial operation on December 28, 2012.

However, the Joy Park did not open as scheduled and has been suspended indefinitely since the end of 2013. Not only is the Happy Park abandoned, but also the four supporting staff dormitories are abandoned. Due to long-term disrepair, the basement was completely submerged in water, with a depth of about one to one and a half meters.

Blindly expanding and burying hidden dangers

Selling land use rights in the name of an industrial park

What are the reasons behind the transition from "star projects" to unfinished projects?

As one of the core investigators of this unfinished project, He Yunchao, Deputy Director of the Huainan Judicial Bureau, stated that the fundamental reason is the blind expansion of the enterprise, deep debt crisis, broken funding chain, and difficulty in maintaining operations.

Demolish the east wall to make up the west wall

Zhigao uses crooked thinking in the construction of industrial parks

Zhigao has multiple projects similar to Huainan in the country, all of which have a business model of "theme park+real estate".

In a contract, the reporter saw the following statement: "The group has" operated and developed a number of public cultural tourism, technology, and commercial real estate projects with great social influence and good economic benefits with strong strength, playing a demonstrative and leading role. "

But in fact, the group is using assets from various industrial parks to mortgage and guarantee financing, robbing Peter to pay Paul. Therefore, once the debt is due and unable to be repaid, it will lead to a breakdown of the funding chain. From the beginning, Zhigao did not focus entirely on the construction of the industrial park, but instead used crooked thinking.

Some people estimate that even if the Happy Park operates normally, the ticket revenue is only about tens of millions of yuan per year, which can be considered a drop in the bucket for such a large project.

What does Zhigao rely on for profit? The answer is real estate.

Building a Happy Park on one side

One side secretly operates to resell state-owned land use rights

In order to operate the entire project, Taian Zhigao Group has established three subsidiaries in Huainan: Zhigao Animation, Zhigao Industry, and Shenzhou Happy Park Real Estate.

In reality, Zhigao did not develop real estate, but instead secretly searched for buyers to resell land use rights while building a happy park.

Zhigao's first land purchase was on March 7, 2011, and just 15 days later, he secretly sold 1200 acres of land to three companies including Zhejiang Hengyou Electromechanical Co., Ltd. for 1.2 billion yuan at a price of 1 million yuan per acre, along with Tonggao Industrial Company. Externally, they falsely claimed that it was an internal equity transfer within the group, thereby obtaining the government seal. Two days after receiving the land, Zhejiang Hengyou immediately changed the legal representative of Zhigao Industry to Lv Zhimin of its own company.

The transfer and sale of state-owned land use rights by Zhigao violates relevant national laws and also violates the contract signed between the Huainan Municipal Government and Zhigao Group. Without the consent of the Huainan Municipal People's Government, Taian Zhigao Group is not allowed to transfer, mortgage, or cooperate with the development of the transferred land. But Zhigao still managed to sell 672 acres of commercial and residential land through covert operations, earning 650 million yuan.

The legal representative of the project, Jiang Dongting, also failed to use all funds for project construction due to illegal transfer of state-owned land use rights, resulting in a series of problems that caused significant losses to the country and serious social impacts. The final court ruled that Jiang Dongting, the legal representative of Taian Zhigao Group, was sentenced to 6 years in prison and fined 65 million yuan for the crime of illegal transfer and sale of land use rights.

Local government abuse of power and lack of supervision

"Zero land price" land acquisition buries legal risks

From the perspective of the local government, the then mayor of Huainan City, Cao Yong, and other major leaders also bear an inescapable responsibility for the industrial park's failure and causing huge losses.

"Zhigao's three subsidiaries obtained corresponding land use rights through bidding, auction, and listing. The land transfer fees they paid were handed over to the municipal finance department, which fully transferred them to the account of the Municipal Urban Investment Company. The Municipal Urban Investment Company fully transferred them to Huainan Zhigao Animation. From January 2011 to December 2012, the Municipal Urban Investment Company fully transferred 27 transactions of 1.722 billion yuan." said Hu Qian, a legal officer of Huainan Urban Investment Company in Anhui Province.

So, 1.722 billion yuan turned around and returned to Zhigao's hands. Why do we have to pay first and then return the money?

Originally, in February 2010, when the Huainan Municipal Government signed a contract with Shandong Taian Zhigao Group, it was agreed that the Huainan Municipal Government would transfer 3200 acres of land to Zhigao and exchange the land for 15% equity of the total assets of the theme park.

Subsequently, both sides also signed a supplementary agreement, and the then mayor of Huainan City, Cao Yong, abused his power to allow Zhigao to use the method of "paying first and then returning money" to acquire land, and changed his shareholding from 15% to 16%. Not only is the land free, but the local government also provides various discounts, including exemption from various administrative fees involved in project development. In this way, Zhigao obtained the land at "zero land price" without any risk, and transferred the risk to the local government, while the municipal government lacked supervision over project operation.

He Yunchao, Deputy Director of the Huainan Judicial Bureau, believes that "Cao Yong changed the decision of the Municipal Party Committee and Government and the formal agreement in the contract, illegally returned the land transfer fee, violated the regulations of the General Office of the State Council, and led to the project being in a state of violation from the beginning, laying legal risks."

As early as 2006, the General Office of the State Council issued a notice that no region, department, or unit is allowed to reduce or exempt land transfer income under various pretexts such as investment promotion and old city renovation, and implement a "zero land price" policy.

However, Cao Yong, the former mayor of Huainan City, abused his power and violated this regulation by exchanging land for equity, resulting in a huge economic loss of 1.526 billion yuan. According to statistics, out of the planned 3200 acres of land, Zhigao ultimately obtained the right to use 1770 acres of land. In addition, Zhigao illegally occupied land twice, totaling 700 acres, which was later investigated and recovered by the land department.

Cao Yong, former mayor of Huainan City, has committed the crime of abuse of power due to causing significant losses of 1.526 billion yuan to the country and a negative impact on society. In addition to the crime of bribery, the court ultimately sentenced him to 9 years and 6 months in prison and fined 2.6 million yuan. Other relevant responsible persons have also been subject to legal sanctions.

In addition to selling land at zero land price and exchanging land for equity, there is another reason why the project is abandoned, which is the lack of scientificity in project approval. A news report about the expected economic benefits of the project that year stated that the park's design received 3.5 million tourists annually, which could drive the overall tourism economic benefits of Huainan by 5 billion yuan, making it a new iconic ecological and cultural tourism project in Anhui.

It is unknown how this conclusion was reached, but both parties stated in the contract that "Party A and Party B have conducted in-depth discussions on the good prospects and potential risks of the project, and reached a consensus.". In fact, the decision to set up a theme park was fraught with high risks from the beginning. Later, Zhigao's similar projects in many places such as Panjin, Longyan, and Xinyang were gradually abandoned and he owed huge debts, which is enough to prove this.

At present, the unfinished project has been auctioned off for disposal

Local revitalization and utilization will be carried out as soon as possible

How will this unfinished project be handled?

Last March, Huainan High tech Zone Development and Investment Co., Ltd. acquired the ownership of the land and ground facilities of Happy Park for 505 million yuan through auction. Subsequently, the Huainan Municipal Government invited several well-known domestic theme park operation agencies to conduct on-site evaluations and demonstrations of the project.

Hu Dechun, spokesperson for the Huainan Municipal Government in Anhui Province, said that the municipal government has formed preliminary disposal opinions, and the original employee dormitories will be converted into talent apartments; Transforming the theme exhibition hall into a municipal science and technology museum, and introducing the cultural and media industry for utilization; The land that has not yet been constructed should be planned and designed as soon as possible. After the approval of the new round of national spatial planning, it should be revitalized and utilized as soon as possible.

According to the conclusion of the investigation team, this large-scale investment attraction industrial park project was illegal from the beginning, but ultimately failed due to a broken capital chain. The investors and relevant violators in Huainan City were dealt with legally. To develop the economy, we must not be impulsive, blind, and eager for quick success. We must not violate laws, regulations, or play sidelines. We must solidly and steadfastly carry out modernization construction.