The tax shortfalls in the city of Penzberg this year will possibly be much higher than expected in the spring.
City treasurer Hans Blank now reckons that they will amount to just under 5.2 million euros this year.
More failures, says Blank, could follow.
Penzberg - Last March, city treasurer Hans Blank assumed that the tax losses this year would add up to 1.3 million euros.
A quarter of a year later it looks a lot worse.
Blank now expects tax losses for the city of Penzberg of 5.195 million euros this year.
According to him, there is a minus of 1.5 million euros in trade tax.
In the budget, the city had expected 19.5 million, according to the current state it will now be 18 million.
Blank stated in the latest city council meeting that the city was still doing very well thanks to its industry focus.
However, the main payments in 2021 are advance payments.
So there could still be changes.
Bigger slump in income tax - more than other municipalities
The city of Penzberg is experiencing a major slump, namely in the amount of 2.2 million euros, when it comes to contributing to income tax.
Instead of the planned 13.2 million euros, only eleven million is expected to flow.
Blank spoke of a disproportionately high failure.
The city of Penzberg has "here twice as high failures as other district municipalities".
In official cities with a high proportion of public sector employees, such as Weilheim, the decline is only half as high, he said.
The treasurer also reports slumps in comparison to budget planning in terms of participation in sales tax (minus 1.1 million euros) and income tax replacement benefits (minus 395,000 euros).
Blank justified the financial situation with the effects of the pandemic.
It is the strongest economic downturn in recent history with a far more profound impact than the financial and economic crisis ten years ago.
The treasurer announced that he would present a supplementary budget in July.
He hoped the corona pandemic would not require another addendum, he said.
Rising raw material prices are also a cause of concern - construction is becoming more expensive
However, it is not just the tax shortfalls that are hurting the city. Rising raw material prices are also a cause for concern. Blank explained that the city of Penzberg was doing an excellent job in activating funding. For the construction of rental apartments west of Birkenstrasse, 20.4 million euros are flowing, which corresponds to 10.1 percent of the total funding in Upper Bavaria. However, the high subsidies "more than eaten up by the rising prices" in the construction work of the city. Blank said that there is now hardly a city council or building committee meeting in which no unplanned expenses are approved, which are due to the high Penzberg standard and price increases. According to the city treasurer, "rapid planning and implementation as well as efficient controlling of numbers" are important here.Blank also recorded more expenses in the administrative budget, by around one million euros. According to him, the city will therefore have to dig deeper into its reserves. They have meanwhile melted down to around nine million.
Mayor Stefan Korpan (CSU) explained with a view to the announced financial meeting of the Penzberg city council that priorities had to be set. If you invest in one place, there is less money available elsewhere. The situation is different today than it was a few years ago, said Korpan. "It is important not to forget that you have to pay for all your wishes."