Muhlheim – Missing income due to the Corona crisis poses great challenges for the municipalities in Hesse. The Hessian Association of Cities and Municipalities called for cooperation between the federal government, the states, and the municipalities. “Both the federal states and the federal government must not leave the municipalities alone,” spokesman Karl-Christian Schelzke told the German Press Agency.
The consequences would have to be shouldered together, «every one according to their possibilities and assets». Measures should be planned from now on. According to the association, the municipalities are missing income from trade tax, public institutions, and income tax shares. However, the municipalities would have to pay the social expenditure. “Overall, it’s a difficult situation,” said Schelzke.
The city of Offenbach, for example, expects considerable losses, as a spokeswoman said. The city also supports social institutions to maintain them. For example, the city has made contributions to kindergartens to relieve parents. However, the consequences of this cannot yet be estimated.
According to an analysis by the Hessian Taxpayers’ Association, the municipalities of the Limburg-Weilburg district are well prepared for the Corona crisis. Before the crisis, the cities and municipalities had planned without budget deficits, mostly even without tax increases. “The current challenges show how important that was,” said Chairman Joachim Papendick. “The municipalities can counter this better with solid finances than with already tight budgets.”
Many other municipalities in Hesse have already exhausted their income opportunities and, for example, have increased the property tax drastically, according to the city and municipal association. “At some point, there will be the end of the flagpole,” said the spokesman. “There is no longer any scope to generate additional income.”
The taxpayers’ association announced on Friday that the tax burden in the independent cities in the country has so far remained stable this year. The Corona crisis could change that. “It will probably take years before the cities are back where they are now,” said Papendick.
In the opinion of the association of cities and municipalities, the financial situation of many municipalities was difficult to even before the Corona crisis – that would only get worse now. Investments in the renovation of townhouses, for example, might be postponed. “We will leave a considerable burden on future generations without the corona crisis alone,” said the spokesman.
How serious the consequences for the municipalities are can currently only be speculated, said Schelzke. After the Corona crisis, there could also be an upswing for shops and restaurants – all this is just “coffee grounds reading”.