The hole in the Unterhachinger municipal budget is mainly due to the trade tax repayment to a single company. The town hall administration explained this on Wednesday evening at the municipal council meeting and put the loss of income at a total of twelve million euros. Two million of these are accounted for by another company. The town hall has kept silent about which large taxpayers have – in retrospect – transferred too much since 2020. City hall spokesman Simon Hötzl indicates which sectors are involved: “Unterhaching’s economy is good in food and real estate, that was good in Corona and now also has risks.”
The now financially straitened Unterhaching, after all the second largest municipality in the district of Munich, is an example of how a municipality got through the pandemic well and then experienced the big slump with the beginning of the energy crisis. Last week, the main and finance committee issued a budget freeze in order to keep expenses as low as possible. The financially tense situation is having an impact on the 2023 budget in particular. Negotiations on this began late on Wednesday evening in a non-public meeting. They will drag on even longer and they will be more difficult than they have been for a long time. “We have to process a double-digit million amount as a return, we can’t do that easily,” said Mayor Wolfgang Panzer (SPD) in advance.
“It’s not a one-off situation, it’s an economic situation”
In 2010, Unterhaching had to tighten its belt quite tightly: there was 25 percent less revenue back then, now at the end of this month a third of the trade tax revenue calculated for 2022 is gone and it does not look like the situation will improve. High expenses for service contracts, management costs in municipal properties, expected high wage agreements and massive upheavals in the energy sector hardly bode well. “It’s not a one-off situation, it’s an economic situation,” said Panzer. Income and expenditure have developed so far apart that it is no longer possible to balance the administrative budget. The gap here is expected to be eight million euros and must be filled with money from the general reserves. That could be just enough, according to the town hall administration. But then the savings stocking would also be empty.
Panzer clearly remembers speaking of the community at the New Year’s reception 12 years ago as a jumbo jet with its wings clipped. “Now we have to initiate the descent again,” he said on Wednesday evening. He rejects the accusation that he should have reacted earlier. “We have drawn up the budget to the best of our knowledge and belief,” he emphasized in front of the municipal council. For 30 years this has been accepted unanimously in Unterhaching. There are always changes throughout the year. “It was not foreseeable that we would have to return taxes in this form, nor that the costs would increase so much.”
“When you pull a card out of a house of cards, it shakes”
The wings of the Unterhachinger jumbo jet had grown again in the years after 2010, reaching record budgets of more than 100 million euros and annual trade tax revenues of more than 30 million. However, the money was not put on the high edge, but invested. “That’s just the disadvantage: If you pull a card out of a house of cards, it starts to falter,” says the mayor. At the finance committee meeting, Michael Durach (CSU) wanted to know how bad it was, on a scale of one to five. “It’s level five,” he now knows, “and that means a crisis.” Now everyone has to work together and make decisions. Emil Salzeder from the Neo faction also called for joint action. “We were all there when we partied and splurged like there was no tomorrow.” You now have to do unpretentious work with a sharp pencil.
The budget freeze means that all contractual and legal obligations are still met and decisions continue to apply. However, they will be checked again with a view to 2023. “The extension to the school is proceeding as normal,” said the mayor, “but if we had decided to build an airport in 2025 and hadn’t started yet, we wouldn’t start now.” You have to sit down and find a solution, not get caught up in party politics. It’s also not about scaremongering. “We have to think clearly: How do we continue?” said Panzer.
On the expenditure side, above all the voluntary services of the municipality are put to the test, the grants and subsidies, as well as the consolidation of the real estate portfolio. Claudia Köhler from the Greens made it clear even before the budget consultations began: “We want to make our red lines clear right away: We are by no means involved in saving for children, in education, in the social sector.”