Financial challenges: Reichertsheim approves new budget for 2025

Financial challenges: Reichertsheim approves new budget for 2025

Mayor Franz Stein discussed the financial challenges of the municipality of Reichertsheim at the most recent municipal council meeting. According to the information from OVB Online Treasurer Doris Hauck describes the current situation as “challenging”, due to staff fluctuations and high school association contributions. These issues have a reverberating impact, the impact of which will continue to be felt by the middle of next year.

In 2024, the municipality expects an annual result with a surplus of 420,000 euros, despite existing staff shortages in the treasury. However, a decline in trade tax is forecast for the current year. The allocations still increase, while the district levy falls by 5% compared to the previous year. At the same time, the school association fees for the communities of Ramsau and Gars had to be increased significantly; they increase by 88% and now amount to a total of 438,000 euros.

Budget planning and investments

The budget planning for 2025 envisages extensive investments, while the municipality's financial situation is increasingly falling into debt. The planned investments include, among other things, the expansion of a local heating network, land reorganization, broadband expansion, as well as the necessary funding for the kindergarten and the building yard. In total, investments of 3.9 million euros are necessary, which are to be financed by a required loan of 900,000 euros.
With an initial approach of 4.5 million euros in the administrative budget and almost 4.2 million euros in the asset budget, the financial situation will be stabilized in the long term.

The adjustments to the property tax due to a revaluation and changed assessment rates further exacerbate the situation: the assessment rate for property tax A (agricultural) is 520%, while property tax B (residential development) is 225%. The loan for investments will also lead to an expected increase in municipal debt from 1.7 million euros to an expected 4.1 million euros.

Trade tax and comparison with neighboring communities

The planned trade tax revenue is estimated at 850,000 euros, which is 54,000 euros less than in the previous year. However, there are signs of a decline in the income tax portion to 1.2 million euros. The key allocation amounts to 378,000 euros, while the municipality levy is reduced by 71,000 euros to 609,000 euros.

The effects of the trade tax on the community can also be seen in a comparison with the surrounding communities. Several communities within a 25 km radius have lower assessment rates, including Amerang with 290%, Aschau a.Inn and Kirchdorf with 300% each. These differences show that Reichertsheim has a higher tax burden compared to the rest of the region, which could potentially make it more difficult for new companies to settle there.

In view of the future financial challenges, the budget and financial plan were unanimously approved, but the community is required to find ways to stabilize and sustainably improve its financial situation.