BULGARIA: END GAME IN SIGHT ON JEWISH RESTITUTION

C O N F I D E N T I A L SECTION 01 OF 02 SOFIA 001494

SIPDIS

SIPDIS

EUR/OHI FOR JOHN BECKER

E.O. 12958: DECL: 10/26/2016
TAGS: PREL PGOV KNAR BU
SUBJECT: BULGARIA: END GAME IN SIGHT ON JEWISH RESTITUTION

REF: 05 SOFIA 1318

Classified By: Ambassador John Beyrle, for reasons 1.4 B & D


1. (C) SUMMARY: A report submitted to the Prime Minister by
the government-appointed Restitution Commission sidesteps the
controversial Rila hotel case (reftel),but recognizes Jewish
claims on MOD property in Varna and urges the Ministry of
Health (MOH) to give Shalom some space at the
already-restituted hospital (which it has so far refused to
relinquish). Jewish community leader Kalo and JDC local rep
Djerassi seemed in complete agreement in their assessment:
the government is open to finally settling the Varna and Rila
claims (Rila through a creative "gift" arrangement),but
MOH's unresponsiveness is a major roadblock. The DCM
reiterated our readiness to help but stressed the need for
all -- the Jewish community here and the American JDC -- to
speak with one voice and seek one outcome. All agreed that
the community will approach the government to set timelines,
and we will follow to make sure the government sticks to
them. With the implementation of the Commission's
recommendations, this long and frustrating battle may finally
come to the end. END SUMMARY.


2. (C) The DCM met with Shalom's Kalo and JDC's (JOINT
Distribution Committee) Djerassi to discuss their response to
the Commission's report. (PM Stanishev formed the Commission
in March, following President Parvanov's informal commitment
to review all outstanding claims of the Jewish community.)
The DCM noted that with the report in the PM's hands, now was
the time for the Jewish community and JDC, both here and in
NY, to speak with one voice on the issue. He encouraged all
to share information, to clarify their goals, and to develop
a common strategy.


3. (U) The three main properties addressed in the report
were the Rila hotel, the Varna property occupied by MOD, and
the Sofia hospital, restituted in 1997 but still occupied by
MOH. The following are the Commission's recommendations, the
community's reactions, and our proposed way forward. Our
unofficial copy of the report will be sent via septel email.


4. (SBU) Rila hotel: The Commission considers the case
closed. Since the court decided against restitution, the
Commission sees no grounds to reopen the case (reftel). The
community expected this and is reconciled to it.
Nevertheless, it is looking for a "gift" (not compensation --
they specifically want to avoid the term because it implies
circumventing the judicial system) from the Bulgarian
government. Under Bulgarian law, the state can gift
properties to NGOs.


5. (SBU) The "gift" Shalom and Djerassi identified is the
top two floors of the Saborna street building, near the site
of the former U.S. Embassy. The bottom four floors had
previously been restituted, but the top two had not been part
of that settlement since they had been added during the
period of state ownership. Gaining control of the whole
building is an enviable deal, especially considering its
location in the center of town and the current boom in
property values. The alternative, given the court decision,
is to get nothing. We found that Kalo and Djerassi were in
complete agreement that Saborna was the optimum, and perhaps
only, way to settle the Rila issue with the community getting
something of value.


6. (SBU) Varna Property (Synagogue and Rabbi's House): The
Commission acknowledges Shalom's rightful claim to the
property. Since MOD opposes returning it for national
security reasons, the Commission recommends compensating
Shalom with comparable value property elsewhere. The MOD has
already proposed several options and seems open to negotiate
with Shalom. The key, however, is for the MOD to offer
suitable properties rather than leaving the onus on Shalom to
try to identify them.


7. (SBU) Hospital: The Commission recognizes the
community's unequivocal claim to the property and recommends
the Ministry of Health gives Shalom at least six rooms while
it vacates the property. This is a clearly egregious case.
The cash-strapped MOH has failed to abide by the court
decision that restituted the property, has stopped paying
rent, and is avoiding giving Shalom the six rooms it
requested to start a hospice. The community has been
reasonable in not trying to identify or specify which rooms
it will receive, but the MOH has been completely
unresponsive. Djerassi and Kalo agreed that getting the six
rooms will be their first priority.


8. (C) COMMENT: This has been a long, complicated, and
often frustrating battle, but we may be approaching the end

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game. Shalom and the local JDC rep seem to be in sync on
what they want -- the two floors on Saborna, comparable
compensation from the MOD, and the six hospital rooms -- and
are ready to approach the government for concrete timelines.
If Shalom and JDC are united, they will have a better shot at
success. We will push Bulgarians to live up to their
commitments in both letter and spirit in our upcoming
meetings with the President and Prime Minister.
BEYRLE