Hesse Landtag Debates KFA Overhaul as Government Sets €7.4–€7.5 Billion Transfers
Opposition leaders argue the package is too modest to relieve local budget stress despite the finance minister’s promise of a more stable and simpler system.
Overview
- The CDU–SPD coalition introduced legislation to restructure the state’s municipal funding mechanism after a multi-year evaluation.
- The Finance Ministry projects about €7.4 billion in payments to municipalities for 2026 and roughly €7.5 billion for 2027, which Minister Alexander Lorz says exceed prior state plans.
- Lorz contends the reform will stabilize and simplify allocations and better support rapidly growing or shrinking communities while reflecting Hanau’s 2026 departure from the Main-Kinzig district.
- Green lawmaker Andreas Ewald called the adjustments marginal and effectively a cut given expanded local duties, and FDP budget spokesperson Marion Schardt-Sauer labeled the draft a mini-law with cosmetic changes that leaves core services at risk.
- Municipal finances remain strained, with this year’s transfers at €7.1 billion—€400 million below plan—and local governments reporting a combined deficit of about €2.6 billion last year after nearly €700 million in 2023.