The top comment has an interesting suggestion for why this is done:
[…] this is how people in local governments make money in Russia:
Step 1: have a $100,000 of tax money budget for fixing the pavement on street XYZ
Step 2: pay your nephew's 'construction company' $10,000 for the 'work' they did
Step 3: pocket $90,000 of tax money
Step 4: oh noes!! the road cracked AGAIN! not AGAIN!! oh well, guess gotta go fix it
Step 5: goto Step 1 Today 1:36am