Baden-Baden in financial distress: millionaire city calls for help!

Baden-Baden in financial distress: millionaire city calls for help!

The city of Baden-Baden is facing a dramatic financial crisis. Despite its prominent position as the city with the highest concentration of millionaires in Germany, with 198.3 income millionaires for every 100,000 taxpayers, the financial problems are acute. The city can only pay its bills until the middle of the year and it is reported that it will have to take out additional loans of 32 million euros by the end of the current year to cover ongoing costs, as Mercury reported.

The causes of the financial crisis are diverse. Income from trade tax has fallen dramatically, while spending in the social sector is increasing. This development led to the city's budget getting out of control. Mayor Dietmar Späth was critical of the lack of support from the state of Baden-Württemberg and pointed out that the city had asked for help but had been rejected. The President of the Association of Cities, Frank Mentrup, also sharply criticized the Ministry of the Interior by pointing out that state politicians had not sufficiently understood the situation of the municipalities.

Financial measures and impacts

In order to deal with the crisis, a budget freeze has come into force. The city plans to temporarily suspend all civil engineering construction projects, including road construction projects. The construction projects that are already underway, such as the city archives, are also being checked. This leads to a temporary halt to investments that are important for the development of the city. Those responsible were surprised by the deterioration of the situation, but tough austerity measures were announced.

Citizens also have to expect fee increases to compensate for the deficits in the city's budget. The annual loss in bus transport is up to 8 million euros, which is why considerations are being given to adjusting local public transport timetables. However, no complete cancellations of bus routes are planned. A citizens' forum took place on May 6th, at which 310 residents were informed about the situation.

Political dimensions and demands

Construction projects and investments are not the only areas affected by financial distress. Announcements were made about cuts in public transport and the cultural sector, as well as cuts in the maintenance of playgrounds and parks. The Interior Ministry rejects criticism of the money management and emphasizes that support was offered. Prime Minister Winfried Kretschmann supports the stance of Interior Minister Thomas Strobl and recommends a more moderate language.

Martin Gross, regional district manager of the ver.di union, criticized the tax and distribution policy and called for a fairer distribution of tax burdens between the federal, state and local authorities. The city of Baden-Baden is facing structural problems that are contributing to the current financial crisis, and a restructuring of the financing systems at the municipal level is required in order to permanently stabilize the city's budget.