Brno will borrow 3 billion crowns for the Southern Center

Brno - In the coming years, Brno will not avoid loans. According to the mayor Roman Onderka (ČSSD), further loans will be required for the planned construction in the so-called South Center. The investments are linked to the construction of the new train station, around which a new city district for 30,000 to 40,000 inhabitants is to be created. Brno will invest about three billion crowns in networks, roads, sidewalks, tram tracks, and trolley wires in the area. The spending must be accounted for in the next three years, the mayor told ČTK.
    Due to the upcoming loans, Brno is trying to maintain a good rating. This way, it will retain the possibility of borrowing from banks at favorable interest rates in the future. According to Onderka, this is so far successful. In the eyes of bankers and auditors, it has helped Brno that last year it reduced its overall debt by 16 percent by repaying nearly one billion crowns. Brno's annual revenue exceeds ten billion.
    The mayor emphasized that the city hall is repaying loans even during the crisis. Last year's tax shortfall reached 750 million crowns; this year, according to estimates from the city economists, the situation will be the same or even worse. "We are counting on a shortfall of up to minus 800 million crowns," said Onderka.
    Despite tax revenues, Brno is spending more this year than in previous years. The shortfalls in tax revenues are being compensated by grants from European funds and also by income from the sale of municipal property, especially rental apartments.
    The budget for this year, approved by the councilors, amounts to 12.2 billion crowns, the majority of which, 8.2 billion crowns, is for operations. Operating expenses are expected to increase by about seven percent compared to last year's. Investment expenses are planned in the budget at just under four billion crowns, which is a seventeen percent increase compared to last year. This year's revenues are expected to reach 10.3 billion crowns.