Aindling in the financial crisis: budget situation worrying!

Aindling in the financial crisis: budget situation worrying!

The financial situation of municipalities in Germany is tense, and this is particularly evident in the Aindling market. Mayor Gertrud Hitzler (CSU) describes the current budget situation as precarious. The local council approved the budget for 2025, but there was a dissenting vote from Josef Settele (non-party). The decision comes against the background of a financing deficit of 24.8 billion euros, which was reported by the Federal Statistical Office (Destatis) for 2024. This deficit represents the highest level since 1990.

For 2025, Aindling is planning a budget volume of 14.7 million euros, which represents a slight decrease compared to the previous year (14.9 million euros). The administrative budget provides for income of 11.16 million euros, which comes from taxes and general allocations. Despite the increase compared to the previous year of 10.6 million euros, expenses are the same at 11.16 million euros, which creates financial pressure. The highest expenditure item is interest, levies and other contributions, which amount to 4.5 million euros.

Challenges in asset management

The asset budget has income of 3.52 million euros, which represents a decrease compared to 4.3 million euros in 2024. Here too, the basic situation is difficult: the planned minimum transfer from the administrative budget to the asset budget will be only 77,500 euros, far below the legal minimum requirement of 362,000 euros. In order to close the financial gaps, reserves and property sales should be used.

Aindling currently has a debt level of around 4.7 million euros, spread over six current loans. Additional financial pressure is caused by ongoing construction work, which is burdening the financial budget with 2.1 million euros. The reserves currently amount to 800,000 euros, of which 355,000 euros have already been earmarked for minimum contributions and investments. The planned projects could ultimately use up the reserves, which could lead the municipality to have to take out new loans.

Municipal financial situation under scrutiny

The challenges facing Aindling are not isolated. A national-level study has shown that municipal budgets as a whole are under enormous pressure. Presidents of the municipal umbrella associations report a permanent imbalance in municipal finances. They demand a larger share of community taxes and criticize the expansion of municipal tasks without adequate financing.

In addition, the municipal investment backlog has already grown to 186 billion euros and is expected to continue to rise. The forecast for the current year indicates a decline in the municipal financing balance of more than 7 billion euros, after a decline of 8 billion euros in the previous year. These developments could endanger Germany's future viability, warns the German Association of Cities and Municipalities. Increasing expenses in municipalities, which are not only due to inflation but are also caused by higher numbers of cases in the social sector and new legal claims, represent a significant challenge.

In order to sustainably improve the financial situation of municipalities, the federal and state governments must change course. The recent events in Aindling are an example of how dependent the communities are on the general conditions and how easily they can find themselves in a precarious financial situation and thus be affected by overall development.