Overview
- The cross-party mayors of Germany’s 13 non-city-state capitals sent a formal warning to Chancellor Friedrich Merz and state leaders, saying municipal budgets are at the limit and risk tipping into collapse.
- They call for legally guaranteed compensation whenever federal laws impose new costs on local authorities, plus restitution for earlier mandates, proposing a higher municipal share of value-added tax as one remedy.
- The group urges state governments to withhold Bundesrat approval from federal bills unless local financing is secured and to implement new burdens via state law so constitutional funding rules apply.
- Municipalities reported a €24.8 billion financing deficit in 2024—the highest since 1990—with rising social spending, personnel costs, the underfunded Deutschlandticket, and hospital financing cited as key pressures.
- Bavaria responded with a record €12.83 billion municipal transfer for 2026 and €3.9 billion from the federal investment fund, a step local associations welcomed as relief but not a structural fix as a coordinated federal reply remains pending.