Bulgaria has 264 separate municipalities and 156 of those /60%/ have debts. Their budget balances show that they spend more money than they make.

Their incomes are due to state subsidies and local taxes and fees, mainly ones on garbage, buildings and vehicles, alongside some licenses and certificates, also municipal property rents. In fact the centralization of local authority in this country is strengthening, despite all the talks about more independent municipalities, because municipal finances depend mainly on the state and the EU funds. That is why rumor has it for a long time that each next party that steps into office begins to fund in advance the municipalities, governed by its representatives. Such talks get really strong on the eve of elections, which is the current situation in Bulgaria.

It is true that over the last EU budget period there were lots of investments at many towns and villages with numerous things improved in a visible manner. At the same time the situation in a series of regions of Central and West North Bulgaria remains tragic. Yes, the population is diminishing in the countryside, but it is due to migration from terrible living conditions mainly.

The financial problems of the Bulgarian municipalities are so serious that the central authorities had to take exclusive legislative measures for support. The poorest places will be able to use interest-free loans under certain conditions and some 40 municipalities are expected to use that option soon.

The overall municipal debts and guarantees come up to more than EUR 600 mln. and 75% of the overall debt comes from 20 municipalities, as the Sofia one takes 45% of the common debt.

Experts say that investments, but not EU funding are the solution to the financial issues. This is where local authorities come – they ought to persuade investors to come and invest. Few of them have coped with the task so far and the majority remains poor and dependent on the central authority in Sofia.

English version: Zhivko Stanchev