VZCZCXRO9628
OO RUEHAST
DE RUEHPS #0426/01 1381532
ZNR UUUUU ZZH
O 181532Z MAY 06
FM USOFFICE PRISTINA
TO RUEHC/SECSTATE WASHDC IMMEDIATE 6122
INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE
RUCNDT/USMISSION USUN NEW YORK 0684
RHMFISS/CDR USEUCOM VAIHINGEN GE
RUFOADA/JAC MOLESWORTH RAF MOLESWORTH UK
RHFMIUU/AFSOUTH NAPLES IT
RHMFIUU/CDR TF FALCON
RHEFDIA/DIA WASHDC
RUEKJCS/SECDEF WASHINGTON DC
RUEPGEA/CDR650THMIGP SHAPE BE
RHEHNSC/NSC WASHDC
RUEAWJA/DEPT OF JUSTICE WASHDC
RUFOANA/USNIC PRISTINA SR

UNCLAS SECTION 01 OF 03 PRISTINA 000426 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
DEPT FOR DRL, INL, EUR/SCE, AND EUR/SSA, PRM, NSC FOR 
BRAUN, USUN FOR DREW SCHUFLETOWSKI, USOSCE FOR STEVE STEGER 
 
E.O. 12958: N/A 
TAGS: PGOV PREL KDEM UNMIK YI PREF
SUBJECT: KOSOVO: FINAL THREE PERCENT OF MARCH 2004 
RECONSTRUCTION HARD TO NAIL DOWN 
 
REF: 04 PRISTINA 0524 
 
PRISTINA 00000426  001.2 OF 003 
 
 
Summary 
------- 
 
¶1.  (SBU)  Most reconstruction of homes damaged in the March 
2004 violence has long since been completed, albeit with some 
complaints about the quality of construction and frictions 
about the terms of reconstruction of outbuildings.  Most of 
what has not been rebuilt is in the historic center of 
Prizren, where construction has been hampered by the need to 
draft a special urban plan due to the area's designation as a 
historic site and the unique architecture of the area. When 
some of these obstacles were finally overcome recently, it 
was discovered that additional funding was needed.  Unlike 
the substantial majority of the 97 percent of houses already 
reconstructed, for which returnees have not materialized, 
approximately 36 families have expressed an interest in 
returning to Podkalaja, which would represent a 
proportionately large bump for this disappointing year.  The 
project could be put on track to get returnees back in their 
homes if the PISG can identify funding and if coordination 
among the PISG, UNMIK, and international NGOs involved in the 
reconstruction improves.  End summary. 
 
Background 
---------- 
 
¶2.  (SBU)  Podkalaja, an historic and architecturally 
picturesque section of old Prizren town, was damaged in 1999 
and more severely in the March 2004 riots.  Fifty-seven 
houses were destroyed (a larger figure than that given in 
reftel, arrived at after UNMIK had more fully assessed the 
damage and including houses that had been previously damaged 
in 1999 and whose occupants had been displaced since then), 
and the area's remaining Serb population was displaced to 
other parts of Kosovo or to Serbia.  A Kosovo government 
reconstruction program to rebuild the 934 houses throughout 
Kosovo damaged in 2004 has completed rebuilding all affected 
homes with the exception of an estimated 26 houses in 
northern Kosovo to which Kosovo government reconstruction 
officials could not gain access, three in Fushe Kosove/Kosovo 
Polje whose Serb owners refused the Kosovo government's offer 
to rebuild, and the 57 houses of Podkalaja.  The Podkalaja 
area was not included in the broader rebuilding program 
because the area's designation as a historic site prompted 
Kosovar and international officials involved to opt for the 
creation of an overall urban plan to reconstruct the district 
based on its historic architectural character rather than the 
easier and faster house-by-house approach adopted elsewhere. 
 
¶3.  (SBU)  International Catholic Migration Commission (ICMC) 
personnel told USOP that as many as 36 of the 78 Serb 
families who lived in Podkalaja before 1999 have expressed an 
interest in returning.  The 3 million euros UNMIK estimates 
would be necessary to reconstruct the area has not been 
allocated, and the lack of funding is exacerbating the lack 
of detailed planning since organizations involved in planning 
the return are reluctant to come up with detailed plans--or, 
especially, to raise hopes of return among displaced 
Serbs--in the absence of funds.  The ICMC officials contend 
that even with an immediate allocation of funds, the project 
is at such an early stage of planning that reconstruction is 
unlikely to be completed this year.  UNMIK returns officials 
in Prizren were somewhat more optimistic, and predicted that 
if the money were committed by the end of June some returns 
might be possible by the end of the year. 
 
Bureaucratic Confusion Contributes to Difficulty 
--------------------------------------------- --- 
 
¶4.  (SBU)  The lack of funding for the Podkalaja return 
project stems in large part from confusion among several 
parts of the Kosovo government, UNMIK, and returns 
implementing organizations regarding which of several funds 
was supposed to supply the money.  UNMIK Regional Returns 
 
PRISTINA 00000426  002.2 OF 003 
 
 
Coordinator for Prizren Tim Hudner and colleagues told poloff 
that the Kosovo government had nearly exhausted the 11 
million euro fund it had established for reconstructing the 
March 2004 damage and that the approximately 3 million euros 
needed to rebuild Podkalaja had not been allocated.  Prime 
Minister Agim Ceku's advisor Avni Arifi, the official in 
Ceku's office most directly involved in post-March 2004 
reconstruction, acknowledged the fund had been reduced to 
417,000 euros that will be used to pay outstanding debts for 
other aspects of March 2004 reconstruction, but told poloff 
that Podkalaja's historic site designation meant the money 
should instead come from a separate fund for preservation of 
cultural and religious sites.  Deputy Culture Minister 
Angjelina Krasniqi, however, told poloff on May 16 that the 
cultural and religious preservation fund could not pay for 
the Podkalaja reconstruction because that money was reserved 
for rebuilding damaged churches.  She pinned her hopes 
instead on a donors' conference she said the ministry is 
organizing for mid-June. 
 
¶5. (SBU)  Unclear lines of PISG responsibility for the 
project also have contributed to the confusion over 
Podkalaja.  The project was originally within the scope of 
the commission to reconstruct the March 2004 damage, but 
later was subject to involvement of both the Culture Ministry 
and the Prime Minister's office as the latter became more 
involved to spur progress on overall post-March 
reconstruction.  During meetings in mid-May with poloff, each 
institution seemed to be under the impression that another 
office had the lead on the project, and none appeared to have 
made a priority of cutting through the red tape of 
Podkalaja's historic site status and securing the necessary 
urban plans and funding.  Krasniqi, who until recently had a 
major role in the project, in a May 16 meeting with poloff 
demonstrated particularly little interest in or commitment to 
rebuilding and returns in Podkalaja.  Krasniqi commented that 
she doubted more than ten or fifteen Serb families would wish 
to return; she suggested building apartments to house 
returnees instead of rebuilding the historic district on the 
grounds that the old houses had lacked infrastructure, but 
acknowledged that no one had consulted the prospective 
returnees about this option.  Krasniqi predicted that because 
Podkalaja is a cultural heritage site, its reconstruction 
could take three to five years (though she acknowledged when 
pressed that it would be possible to rebuild houses of 
prospective returnees first and allow them to move in before 
the entire district was completed). 
 
¶6.  (SBU)  Confusion among internationals involved in the 
project also has hindered progress.  The large number of 
returns organizations involved has led to confusion over 
their respective roles and over the best way to move the 
project forward.  UNMIK returns officials' overreliance on 
figures provided by a local returns organization on the 
number of potential returnees and their push to have a 
go-and-see visit before more detailed plans are made for the 
return also have caused consternation among some implementing 
partners, who are wary of raising potential returnees' 
expectations before funding for the project is secured. 
 
Some Rays of Hope 
----------------- 
 
¶7.  (SBU)   Two factors suggest that progress on Podkalaja 
reconstruction may soon improve, if funding can be 
identified.  First is the early May appointment of former 
Culture Minister Behxhet Brajshori--who initially headed the 
commission on post-March 2004 reconstruction--to head the 
reconstruction effort again, a decision made by the Kosovar 
governmnet due to a recognition that progress was stalled and 
something needed to be done.  Arifi told poloff that 
Brajshori was appointed so that he could "see what went 
wrong" and reenergize the process.  Another bright spot is 
the Prizren municipal authorities' active support of the 
return.  UNMIK Prizren returns officials and ICMC told USOP 
that Prizren Mayor Eqrem Kryeziu invariably attends meetings 
 
PRISTINA 00000426  003.2 OF 003 
 
 
related to the project or sends a knowledgeable 
representative.  They also say that municipal returns 
officials have been proactive in working with UNMIK and 
international implementing partners in drafting the urban 
plan and other aspects of return and reconstruction. 
Municipal officials signed a memorandum of understanding in 
early May with Cultural Heritage Without Borders to draw on 
the latter's expertise in technical aspects of town planning 
and architectural design. 
 
¶8.  (SBU)  Even if funding can be identified quickly, 
however, either by the PISG or from other sources, it is 
unclear how quickly reconstruction and returns would begin. 
Hudner and other returns officials indicated that 
reconstruction could begin quickly on some houses based on 
plans used for the reconstruction of several Podkalaja houses 
after 1999 if funding is committed by the end of June, and 
optimistically predicted that some returns could then occur 
by winter.  ICMC, however, pointed out significant 
disorganization among the internationals involved in the 
process and noted that more work would need to be done both 
to determine the real level of interest among returnees and 
to resolve outstanding property issues. 
 
Comment 
------- 
 
¶9.  (SBU)  The Podkalaja return project has been the weak 
spot in the government's otherwise completed effort to repair 
the damage inflicted to Serb homes in the March 2004 riots. 
The Kosovar authorities have too often seen the complications 
caused by the area's historic status, and the resulting 
bureaucratic ambiguity, as an excuse for inaction rather than 
a challenge to be overcome.  If funding can be quickly 
identified, the good cooperation of the Prizren municipal 
authorities and ongoing efforts by UNMIK and implementing 
partner NGOs could help get the reconstruction and return 
process on track.  However, expecting returns to occur this 
year is probably overly optimistic. 
 
¶10.  (SBU)  USOP clears this cable in its entirely for 
release to UN Special Envoy Ahtisaari. 
GOLDBERG