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Ostalbkreis takes out a loan of 15 million euros for important investments
The Ostalbkreis is taking out a KfW loan of 15 million euros for investments in order to overcome financial bottlenecks.
Ostalbkreis takes out a loan of 15 million euros for important investments
The Ostalbkreis district is facing financial challenges and has decided to take out a loan of 15 million euros from the Kreditanstalt für Wiederaufbau (KfW). The reason for this step is the urgent need to finance necessary investments in the budget. On December 17, 2024, the district council approved a loan authorization of 38.3 million euros for the 2025 budget. In the previous loan authorization for 2024, which was approved in 2023, 23.3 million euros remained unused. In total, the district currently has credit authorizations amounting to 61.6 million euros, which indicates the financial burden under which the administration is suffering.
In order to secure this financing, it was decided to take out the loan from KfW, as this bank offers better loan conditions than Kreissparkasse Ostalb. The interest rate for the KfW loan is 2.76 percent with a fixed interest rate of ten years. The loan has a term of 20 years and three grace-free start-up years. The repayment will be made in 80 installments of 187,500 euros each. The resolution was unanimously approved by the district council, which underlines the clear need for action and the agreement on the measures.
Borrowing to strengthen liquidity
- Geplante Kreditaufnahme bei der Kreissparkasse Ostalb:
- Kredithöhe: 6.200.000 Euro
- Zinssatz: 3,59 % mit Zinsbindung von 20 Jahren
- Laufzeit: 20 Jahre
- Tilgung: 80 Raten zu je 75.000 Euro
The Stuttgart regional council confirmed the legality of the 2023 budget on February 17, 2023. The borrowing was approved in accordance with Section 48 of the District Code and Section 87 (2) of the Municipal Code, which provides the legal basis for these financial steps.
The current situation in the Ostalbkreis highlights the financial challenges that many municipalities in Germany are facing. The decision to take out loans shows that the district is striving to fulfill its responsibility for municipal infrastructure while strengthening liquidity. Considering the alternative offers from credit institutions, the administration carefully evaluates the best options to ensure future investments. Ultimately, these measures are intended to help ensure the economic stability of the district.
For further information on financial decisions in the Ostalbkreis district, detailed reports can be found on Swabian Post as well as on Ostalbkreis.de.