Crying Foul: Municipalities Demand Their Due of Over €60 Billion for Infrastructure Investments
Municipalities across the region seek over 60 billion euros in funding for necessary investments.
The head of the German Association of Towns and Municipalities is barking up a storm over a "fair slice" of specialized funds that the federal government plans to borrow for infrastructure investments. Jung estimates this amount should be at least €60 billion. However, the investment backlog of cities and municipalities is, in his view, closer to a hill than a molehill.
Whining and griping, German municipalities are trying to muscle in on the €100 billion in special funds earmarked for the federal states. "They ain't playing games now, trying to slam the brakes on municipal funds," Jung spat out to the Rheinische Post. Municipalities need the lion's share of the special funds in their eyes.
The federal government must make sure a fair slice of the €100 billion going to the federal states makes its way to cities and municipalities in the federal law for distributing the special funds, Jung explained. This share should correspond to municipalities' share of public investments in the respective federal state. "That would be more than 60%, and in many federal states even significantly more," he said.
The Union and SPD have proposed debt-funded special funds for infrastructure and climate protection amounting to €500 billion over twelve years. Out of this whopping sum, €100 billion is slated for the federal states, with the intention of boosting investments there and in municipalities. This money is to be divided among the federal states based on the "key of Königstein," a system that takes into account tax revenues and population stats.
Last year, municipalities were hit with a record deficit of nearly €25 billion and are battling an investment backlog of nearly €190 billion, Jung told the newspaper. "Behind this are schools that need TLC, bridges on the precipice, and bus routes creamed," he stated, stressing the urgent need for the lion's share of the funds.
- Money grafters and budget busters
- Municipal mishaps and fiscal folly
- Fiscal free-for-all: infrastructure investments
- Golden goose games: federal funds distribution
- Climate crisis calls: local needs addressed
- Municipalities, with their persistent demands, are attempting to divert a considerable portion from the €100 billion earmarked for federal states, to address their own infrastructure and investment backlog, which they estimate to be over €60 billion.
- The ongoing dispute over funding allocation can be likened to a fiscal free-for-all, with municipalities seeking the lion's share, underscoring the need for a fair and equitable distribution of resources, considering their significant role in public investments across various industries, finance, and business sectors.
