Pardubice is facing the risk of not having enough money for the summer stadium

Pardubice – The city of Pardubice may not have the funds to complete the modernization of the summer stadium in the next two years. It is not in good financial condition and must, among other things, repay a billion-crown loan. There is a risk that due to the project, it will limit services or sell part of its assets. Adolf Vondrka, a member of the city’s finance committee, told ČTK. The investment was approved by the councilors last week. Mayor Martin Charvát (ANO) rejected the claim that the city cannot manage the investment. He will also seek grants.

The Pirates nominated the non-partisan Vondrka to the committee. He is the owner of the Rybniční hospodářství company in Lázně Bohdaneč. He previously worked in banking.

For this year, Pardubice has an approved negative operating balance of 116 million crowns, which is the difference between current revenues and expenditures. This means that all non-investment revenues of the city will not be sufficient to cover the current operating and maintenance expenses of the city. "The operating balance is a key figure for monitoring the financial health of the city," Vondrka stated.

The city will cover the negative balance from reserves and will draw a billion crown investment loan from Komerční banka. The councilors approved the loan in 2017, among other things, for the summer stadium and the modernization of the athletic facility at Dukla.

"That will not happen. Instead, this year funds are being drawn to cover the negative operating balance by presenting already paid investments from previous years. It's like the city was taking out a retroactive lease to cover current operating and maintenance expenses," Vondrka warned.

When obtaining the loan, the city committed to maintaining a positive operating balance during the drawdown and repayment of the loan. "We are already violating that this year, and banks generally assess the development of the operating balance indicator very carefully and monitor it also during the drawdown and repayment of the loan," Vondrka said.

The city needs 110 million crowns this year for the modernization of the summer stadium, which according to Vondrka it will have. For the next two years, Pardubice will need at least another 270 million crowns, unless additional costs arise.

"The city must drastically begin to reduce current expenses to achieve a positive operating balance, for example by reducing costs for its own operation or limiting some services for citizens. Another alternative would be the sale of city assets, as increasing the city's debt beyond a billion crowns is not realistic in the current situation," Vondrka said.

Construction work is set to begin in April. Mayor Martin Charvát (ANO) already rejected criticism that the city would not manage the financing of the building at Thursday's council meeting. "I believe we can handle the economic situation," said the mayor. According to him, the city has a chance to draw grants from the National Sports Agency, up to 50 percent. The project has had opponents for some time in the initiative "I don't want a stadium on debt" as well as among some councilors.