Municipal fiscal equalization; application for needs-based allocations and stabilization assistance for counties

Needs-based allocations are granted in the event of special expenditure and task burdens and for expert opinions on budget consolidation. Stabilization assistance is granted as a special form of aid to structurally weak districts in financial difficulties that are willing to consolidate.

Description

Classical needs-based allocations

Needs-based allocations are granted to counties which, due to their specific structural circumstances (e.g. high population decline, high unemployment rate), have to bear extraordinary burdens which are not covered by the regular allocations of the municipal fiscal equalization system and which lead to special budgetary difficulties for individual counties - in relation to the general budget situation of the counties - despite exhaustion of their own revenue possibilities. In addition, counties can receive needs-based allocations for budget consolidation reports prepared by the Bavarian Municipal Auditing Association (BKPV).

Stabilization aid

Stabilization assistance is a special form of needs-based allocation. Counties that are particularly affected by negative demographic trends and are in financial difficulties through no fault of their own, or whose financial performance is at risk, can receive state assistance to help themselves by being granted stabilization aid. Adherence to a stringent consolidation course, including the preparation of a budget consolidation concept, is essential in this context. The aim is to achieve a sustained reduction in interest payments and repayments so that the districts regain more financial room for maneuver. The focus of the use of funds is therefore on debt repayment.

Prerequisites

Requirements for the granting of classical needs allocations:

  • special expenses and tasks of the district, which go beyond the usual scope and do not exist in the majority of districts,
  • difficult budgetary situation (to be determined, among other things, on the basis of the free financial margins, the amount of reserves, the county levy rate, etc.).

Requirements for granting classic needs allocations to counties for BKPV appraisals:

  • The appraisal must be current and
  • the county must have particular budgetary difficulties.

Prerequisites for granting stabilization assistance:

  • Presence of financial hardship (assessed as part of an overall assessment, including unrestricted financial margins, reserves, debt),
  • Existence of structural hardship (above-average loss of population or tax power of the municipalities belonging to the district is significantly below the state average),
  • Proof of the will to consolidate (e.g. by drawing up or updating and implementing a budget consolidation concept).
  • From the 6th year of application onwards, additional requirement: existence of a special need.

Procedure

The application for a needs-based allocation and/or stabilization aid must be submitted in the required digital form to the relevant district government. These forward it to the Bavarian State Ministries of Finance and of the Interior, Sports and Integration.

The aforementioned state ministries review the submitted applications.

Once a year (in the fall), the Bavarian State Ministries of Finance and of the Interior, Sports and Integration decide on all applications for a needs-based allocation and/or stabilization aid pursuant to Art. 11 of the Bavarian Fiscal Equalization Act (BayFAG) in the so-called distribution committee after hearing the municipal umbrella organizations.

After the distribution committee, the district governments make the decisions; the grants are usually paid out in the same year.

Special notes

Needs-based allocations do not constitute funding - they are granted to mitigate financial hardship resulting from special expenses/events.

Needs-based allocations are strictly subsidiary and are therefore only considered if other refinancing options (e.g. government subsidies, insurance reimbursements, claims for damages, cost sharing by third parties, etc.) are ruled out.

Deadlines

Applications for needs-based allocations or stabilization aid must be submitted by the deadline set by the Bavarian State Ministry of Finance and Home Affairs. The deadline is announced to the district governments and district offices in the spring by letter from the Ministry of Finance or on the website of the Bavarian State Ministry of Finance and Home Affairs (see "Further links").

Processing time

Decisions on all applications for demand allocations and stabilization assistance are made once a year (in the fall), and the processing time varies depending on when the application is submitted.

Required documents

  • Model 2 to Art. 44 BayHO
  • Sample of § 4 No. 4 KommHV-Cameralistics or Sample § 1 Para. 2 No. 4 KommHV-Doppik
  • last profit and loss account and financial account

    (only for local authorities using double-entry bookkeeping)

  • List of voluntary services
  • Budget consolidation concept in accordance with the requirements of the Bavarian State Ministry of Finance and Home Affairs

    (only for applications for stabilisation aid)

Forms

  • Form, Bavaria-wide: Bedarfszuweisungen bzw. Stabilisierungshilfen
    Please note

    This form has to be signed and sent to the responsible authority. You can sign the form manually and send it by email/fax or sign the form electronically with your qualified electronic signature an send it by (secure) email. If the responsible authority has set up a De-Mail account, you can also send the form by De-Mail using an sender-confirmed message.

Fees

  • none

Remedy

Administrative court proceedings; information

Administrative court action

Status: 02.05.2022

Responsible for editing: Bayerisches Staatsministerium der Finanzen und für Heimat

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  • Prefillable Form, Bavaria-wide
  • Legal bases, Bavaria-wide
  • Legal bases, locally limited
  • Fees, Bavaria-wide
  • Fees, locally limited
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