Project office as a key element of the municipality’s project ecosystem
For a long time, project activities in municipalities mostly existed in parallel with the local self-government system: international programmes and grants were mainly implemented through non-governmental organisations and foundations, without a clear link to strategic development goals for the territories and without a tangible long-term effect for residents. These activities relied more on individuals than on institutions, and as a result, the projects that were implemented often became one-off success stories.
In response to these challenges, U-LEAD proposed that 22 municipalities institutionalise project activities by transforming project offices into empowered institutions. The project activities are to be systematically institutionalised based on the Regulation on Project Activities at the municipality level. To develop the capacity of project offices to administer projects, experts proposed a set of important rules and procedures in the areas of procurement, asset accounting, human resource management, integrity, communications, and organisational activities — i.e. the elements by which donors assess the institutional capacity of a municipality. This is why, in 2025, with the coordination of the municipality’s project offices, around 60 draft regulations were developed, containing rules and procedures that are important for project activities and working with donors and grant providers. At present, the majority of these regulations are being finalised by municipalities.
The thing that makes this approach stand out is that U-LEAD was one of the first programmes in Ukraine to focus not just on project management, but on institutionalising the powers of municipalities in this area.
“Project mindset is a new management reality in which local self-government bodies already operate. They work with projects despite project activities in Ukraine still not being regulated at the state level. Municipalities themselves establish the rules, procedures, and operating models for project offices based on their strategic objectives. And therein lies the power of this kind of change: they arise not from pressure, but from the conscious need of municipalities to move forward,” says Olesia Holynska, the Head of the Project Activities Working Group and Policy Advisor on Project Implementation Capacity Building at the Project Factory team of the Regional Operations Department of U-LEAD with Europe.
From intuition to institution
In August 2024, the municipality of Bibrka in Lviv Oblast set up an investment and development department to handle project activities. Its head, Andrii Datsenko, admits that initially it was not so much a unified system as a collection of expectations from different stakeholders.
“The Investment and Development Department of the Executive Committee of the Bibrka City Council was built intuitively. As a team, we had our own vision of activities and objectives, the city council members had theirs, the head of the municipality had his own ideas, and the executive bodies had something else in mind entirely. Everyone interpreted project activities and team responsibilities in their own way,” he says.
By taking part in the U-LEAD training programmes “Setting up a Project Office” and “Developing the Capacity of a Project Office to Manage Projects in Municipalities”, they managed to systematise and change their approach to organising the work of the “Project Office” [According to Andrii Datsenko, he increasingly uses this name for the department] and define the main objectives for the team: attracting funding and preparing the municipality to work with external resources.
This has exposed a number of gaps. Some officials lacked understanding of how the full project cycle works. Before, most people saw it as a simple process: “fill out the application, get the money, use it, and that’s it: the project is done”. And inquiries received replies such as “We’ll provide the data when we have time”.
The understanding of the need to coordinate the activities of departments and divisions came about while working on regulations concerning accounting, procurement, communication, human resources management, organisation of activities, integrity, etc. This strengthened internal ties, brought together professionals from various fields, led to the “Project Office” being taken seriously, and turned project activities into tangible cooperation between education, social services, culture and sports, finance and legal departments.
“To sum up, in 2025 we were able to unite the municipality around project activities. We systematise information, coordinate departments, engage businesses and partners, and promote tools that help us work towards a common goal,” says Andrii Datsenko.
U-LEAD recommends: Institutionalise
The project office might be different in different municipalities. During the training, the municipalities tried out different organisational forms.
“For example, Novopokrovka municipality in Kharkiv Oblast has a successful working group on project activities, which has attracted about UAH 70 million for various projects in education, youth affairs and culture. However, we have come to the conclusion that the most optimal and appropriate solution from the perspective of the European Charter of Local Self-Government is for these powers to be exercised by a structural unit of the local self-government body,” says Olesia Holynska. She adds that the key condition is to “consolidate” project activities as a new management function.
In late January, the municipality of Borodianka, Kyiv Oblast, approved a regulation governing project activities.
“Why was this so important? Our municipality works with international projects and grants, so we sought to institutionalise project activities, to establish it as a core function of local self-government and build a transparent system of work that is understandable to donors," says Anna Sharykova, the Head of the Department of International Cooperation, Grant Work and Investments of Borodianka Settlement Council. Further plans include establishing a project council under the settlement council and approving, by decision of the executive committee, all regulations developed under the programme “Developing the Capacity of a Project Office to Manage Projects in Municipalities”.
Borodianka Settlement Council set up the Department of International Cooperation, Grant Work and Investments in May 2024. The focus is on project activities and resource mobilisation. U-LEAD training helped them structure the key objectives of the department as a project office and its role as coordinator within the management team.
The project team returned to the municipality with the understanding that their work requires confidence, clear arguments, time investment, etc. Anna recalls a moment during the training when a colleague pulled out a card with two killer whales on it and said, “We’ll go back to our municipalities and start breaking stereotypes”.
For Borodianka, a municipality that had suffered occupation and widespread destruction, this sounded particularly symbolic. It was not only about changing approaches to work, but also about changing mindsets — about having the courage to take responsibility, defend new administrative decisions and build the future of the municipality systematically rather than through one-off support.
“Today, the department is being approached for advice, assistance in writing applications, clarification of procedures and other issues. This means that project activities are slowly moving away from being ‘one-off’ and becoming a core governance function necessary to rebuild and develop the municipality,” states Anna Sharykova.
Institutional memory as a safeguard against network loss and volatility
For Dobroslav municipality in Odesa Oblast, the realisation of its limited resources prompted it to seek an effective model for organising project activities and participating in U-LEAD support programmes. The municipality already had a “grant history”, paving the way for project management. The Department of Prospective Development, International Cooperation and Project Activities assisted other departments: if they saw a relevant education, culture, social services or housing and utilities competition, they wrote applications together.
Aliona Shykhaliieva, the Deputy Head of Dobroslav Settlement Council for Executive Bodies, says that during the U-LEAD training, they gained an understanding of the role of the project office and changed their approach to their work.
“We used to try to do everything: writing projects, implementing them and reporting. This ‘ate up’ our time and prevented us from writing new applications. Now we do things differently: we coordinate, plan, track opportunities, help departments with their applications, but leave the implementation to the relevant practitioners,” she explains.
She believes that project management relies heavily on institutional memory: a register of contacts, partners, donors, and a portfolio of all projects — not only those that have been won, but also those that have been prepared. Some “old” rejected project applications received funding and donor support this year after adjustments and revisions had been made.
“We saw the value of institutional memory: the knowledge gained in projects should not disappear with the turnover of staff, but remain in the municipality. Before, there was a risk: once it was written, approved and put into action, the information would get lost among the departments. People come and go, communication breaks down, and experiences get lost. Now we keep it all in one place and support our partnerships systematically so as not to lose what we have achieved,” says Aliona Shykhaliieva.
According to U-LEAD experts, in times of crisis and rapid change, well-defined rules, procedures and deliverables serve as safeguards against the loss of networks, ensuring the continuity of operations and unfinished projects.
“U-LEAD experts were among the first to talk about institutional memory of municipalities in project management. Institutionalised decisions, accumulated experience and communication reduce the risks of sudden changes in course and deviation from the principles of sustainability,” notes Olesia Holynska. She adds, “Project activities and project offices, enshrined in decisions made at council sessions and seamlessly integrated into the municipality’s administrative and financial practices, are becoming permanent institutions”.
Beyond institutions to practical application
In preparing municipalities to enter the European funding space, U-LEAD with Europe provides comprehensive information and expert support on Interreg Europe, URBACT, LIFE, the Ukrainian Cultural Foundation, current grants, competitions, donor cohorts offering support in various municipal activities, and more.
About 2026
In 2026, U-LEAD will continue to work with municipality teams to institutionalise project activities, improve project capacity and strengthen the potential of project offices, and increase the effectiveness of project cycle management. It will also start a new chapter of cooperation on European projects.
“The selection process for the training programmes ‘Setting up a Project Office’ and ‘Developing the Capacity of a Project Office to Manage Projects in Municipalities’ has begun. Moreover, this year we plan to launch two rounds of this programme, in spring and autumn. There will also be an innovative in-depth programme on ‘Project Management with EU Support’, a course on ‘Project Cycle Management’ will be adapted for social projects, and other initiatives will be implemented. There will be lots of new, useful and interesting activities. After all, municipalities have entered a new reality where the management process is essentially a progression from project to project, from small to large-scale. The outcomes of these projects will determine development, progress, and how people will live in their municipalities — today and in the future,” concludes Olesia Holynska.
