Rhineland-Palatinate: 94 municipalities without an approved budget – structural underfinancing criticized

Several smaller municipalities in Rhineland-Palatinate do not have an approved budget. According to the Ministry of Local Government, this applies to 94 local communities in the country. A provisional budget management applies to these, explained the Association of Municipalities and Cities. The municipalities now have the opportunity to eliminate the reasons for the complaint. In total there are more than 2,200 local communities in Rhineland-Palatinate.

The numbers show that this is not a temporary but a structural problem in the country, explained the managing director of the Association of Municipalities and Cities, Moritz Petry. Last year, more than 60 percent of local authorities were unable to present a balanced budget. This makes it clear that the reform of the municipal financial equalization in 2023 has not solved the municipalities' financial problems. “This urgently needs to be improved.”

Structural underfunding

The municipalities in Rhineland-Palatinate have suffered from structural underfinancing for decades. Petry warned that they would not always have sufficient financial resources for the tasks they had to fulfill. The municipal financial equalization must be designed in such a way that it reflects the actual financial needs of the municipalities. At the same time, the federal and state governments would have to ensure that new or expanded tasks are fully and permanently financed.

Without a fundamental improvement in municipal financial resources, individual aid programs or additional funding will not solve the structural problems, said the managing director of the municipal umbrella association. The municipalities did not need ever new short-term programs, but rather long-term, reliable and adequate financing that would give them real scope for action again.

AfD criticism: No concept

The AfD parliamentary group described the development as alarming, but not surprising. The CDU/SPD state government has not yet presented a concept to resolve the municipal financial crisis. Municipalities, cities and districts do not need short-term financial injections, but rather more room for maneuver in the long term, criticized the opposition faction, which had submitted a parliamentary question about the budgets to the Ministry of Local Government.

The per capita debt of the state and municipalities in Rhineland-Palatinate rose to around 9,600 euros at the end of 2025. According to the State Statistical Office, the total debt amounted to 39.4 billion euros, which was 480 million euros or 1.2 percent higher than the previous year.

Per capita debt of municipalities is increasing

While the country's debt fell by 2.3 percent to 28.4 billion euros, the municipal debt rose by 11.7 percent to almost 11 billion euros. The calculated per capita debt of the municipalities increased to almost 2,700 euros. This puts Rhineland-Palatinate in fifth place among the states with the most indebted municipalities.

The municipalities in Rhineland-Palatinate have been warning for months that they have to take on more and more public tasks. However, the financial resources for this have no longer been sufficient for a long time. Many municipalities are therefore on the verge of being unable to act; the precarious situation is nationwide and extends to the smallest local communities.