Consolidated budget

In 2020, the total consolidated budget (both basic budget and special budget) revenue of the city of Rēzekne amounted to 40.5 million euros, which is 12.5 million euros less than in 2019. The planned total amount of consolidated budget expenditure for 2020 was 57.4 million euros, which is 3.6 million euros less than in the previous year. The share of the budget financed by the city of Rēzekne is 16.9 million euros; it is comprised of a 4.7 million euro budget surplus from the beginning of the year, which is to be allocated for covering budget expenditure, and the difference between planned and outstanding loans, which amounts to 12.2 million euros.

Consolidated budget for the city of Rēzekne in 2013-2020, million Euro

Basic budget revenue

The planned basic budget revenue amounts to 40.5 million euros. The most important source of municipal budget revenue is personal income tax (PIT). In 2020, the projected amount is 34% of basic budget revenue, or 13.7 million euros, which is 2.3 million euros less than the actual revenue in 2019. State tax reform will have an impact on the amount of personal income tax paid into the municipal budget. It is estimated that PIT revenue will decrease in the years to come as the PIT rate is reduced to 20%. To compensate for the negative effect of the tax reform on the municipal budget revenue, a special grant for municipal budgets is earmarked in the state budget.

In 2020, tax revenue from real estate (land, buildings, structures, housing) is projected to amount to 858 thousand euros (2% from the total basic budget revenue).

The rest of the municipality’s revenue comprises 1% of the total budget revenue, amounting to 310.3 thousand euros, and includes gambling tax – 132 thousand euros; natural resource tax – 16.5 thousand euros; fees, fines, other non-tax revenue, revenue from alienating real estate owned by the local government – 161.6 thousand euros.

In 2020, planned transfers to be received from other local governments amount to 1180 euros, or 3% of the total basic budget revenue.

Two million euros, or 5% of the total budget revenue, are to be earned from fee-based services provided by budgetary authorities.

The planned state budget transfers in 2020 amount to 22.4 million euros, or 55.3% of total revenue, including:

  • grants and earmarked grants from the state budget – 8898.7 thousand euros; transfers from the state budget to municipalities (earmarked grants) to cover teachers’ salaries and free lunch for form 1-4 students for eight months;
  • state budget funding for projects supported by EU structural funds – 280.6 thousand euros;
  • a grant to cover the living expenses for people who have been living in old-age nursing homes in the municipality since at least 1 January, 1998 – 27.6 thousand euros;
  • earmarked grant according to Cabinet regulation No. 354 of 26 June, 2018, “Regulation on Foster Families” – 10.3 thousand euros;
  • grant from the Municipal Finance Adjustment Fund (MFAF) – 8.32 million euros;
  • in 2020, the residual MFAF grant of 2019 was received, amounting to 153.8 thousand euros;
  • the projected amount of the transfers from state budgetary authorities for projects co-funded by European Union policy instruments is 4.62 million euros;
  • transfers received from the state budget for partly funded derived public persons and for institutions not receiving budget funding – 99.7 thousand euros.

Basic budget expenditure

The planned basic budget expenditure amounts to 56.8 million euros. In 2020, the priorities of Rēzekne City Council will remain the same as in previous years. The largest amount of basic budget spending is allocated for education, the social sector, and the development of city infrastructure. The budget priorities are: to maintain and develop a network of education, culture, and sports institutions and the services they provide; to maintain social security and support to disadvantaged members of society; to continue the implementation of infrastructure development projects by attracting co-funding from European Union structural funds.

In 2020, the total basic budget expenditure in the city of Rēzekne for maintenance purposes is planned to amount to 33.2 million euros, of which 13.4 million euros will be spent on salaries. The planned expenditure for capital purchases, overhaul, and investments is 23.6 million euros.

For education, the planned expenditure in 2020 amounts to 22.5 million euros (including a 5.4 million euro earmarked grant), or 40% of the total basic budget expenditure. For the maintenance and renovation of preschool educational institutions, a total of 4.1 million euros are allocated; for the maintenance and renovation of elementary and secondary educational institutions and the reconstruction of Rēzekne Secondary School No. 6’s sports field – 8.1 million euros; for the functioning of interest-based education institutions – 1.5 million euros. It is planned to implement projects with the support of European Union funds totalling 7.9 million euros. The maintenance costs of the Eastern Latvian Centre of Creative Services are 0.6 million euros. The planned budget expenditure by the Sports Department (Children and Youth Sports School) for education is 0.7 million euros.

For culture, recreation, and sports, a total of 9.1 million euros, or 16% of total basic budget expenditure, is planned. This sector’s expenditure includes the operational costs of Rēzekne Culture and Tourism Centre and institutions under the centre, as well as costs associated with cultural events in the city, totalling 2.3 million euros. A municipal budget grant of 0.9 million euros is earmarked for covering the operation costs of the Eastern Latvia Regional Multifunctional Centre (LLC “Austrumlatvijas koncertzāle”) in 2020. For the maintenance of Rēzekne Synagogue in 2020, 6.9 thousand euros are allocated, and a further 7.1 thousand euros are planned for the project of restoring the synagogue.

A total of 5.2 million euros are earmarked for the implementation of the project “The construction of Rēzekne Olympic Centre”. Additionally, there are plans to spend a 4.2 million euro loan from the State Treasury of Latvia as part of the 2020 budget. The construction of the sports arena will continue. For the maintenance of the multifunctional sports facility in 2020, a grant of 0.1 million euros is allocated. The total planned expenditure of Rēzekne City Council Sports Department in 2020 is 0.7 million euros.

The funding allocated for economic activity is 12.4 million euros, or 22% of the total basic budget spending, including 7.97 million euros for projects co-financed by the European Union, with the aim of establishing a network of industrial territories to promote entrepreneurship in Rēzekne, reclaiming degraded territories, and creating industrial infrastructure and office space. The total amount of grants for public transportation in the city in 2020 is 2.03 million euros. One of the most important priorities in the 2020 budget is the improvement of municipal roads and street infrastructure. The total amount of funding for the municipal road transport programme is 887,681 euros.

The planned expenditure for environmental protection is 1.8 million euros, or 3% of the total basic budget expenditure.

For maintenance of municipal land and housing in 2020, a total of 2.7 million euros, or 5% of the basic budget expenditure, is allocated. Most of spending in this category is dedicated to the maintenance of city streets, roads, bridges, the lighting system, and cemeteries. A total of 246.8 thousand euros are allocated for street lighting in the city. A further 414.4 thousand euros are planned for the housing development programme. Projects amounting to 1.8 million euros are to be implemented in 2020 with co-funding from European Union structural funds.

For social protection, 5.6 million euros, or 10% of the total basic budget amount, are planned in 2020. This section includes funding for institutions and activities functioning under the department “Social Service”, as well as aid for disadvantaged residents. A total of 1.09 million euros are allocated for social benefits.

For the functioning of the Orphan’s Court, 73 thousand euros are allocated.

To ensure the implementation of the “NGO project ‘Support for the unemployed’” in 2020, 280.8 thousand euros are planned.

Moreover, 92.2 thousand euros are allocated for scholarships and for covering the tuition fees for medical students.

A further 2.6 million euros are to be used for ensuring the functioning of general government units. This includes 2.1 million euros for the functioning of the City Council and Municipal Administration, as well as 40 thousand euros for contingency expenses.

Investment programme

In 2020, municipalities will have the right to receive loans for the implementation of projects co-financed by EU funds and other financial instruments provided by foreign countries.

Based on experience from previous years, the Rēzekne City Council will continue to actively take opportunities provided by European Union funds to implement city infrastructure development projects.

Upon evaluation of the financial capacity of the Rēzekne City Council budget and the project implementation time frames, 81 projects totalling 22.1 million euros have been included in the basic budget capital investment programme for 2020.

Largest 2020 projects

Projects funded by Rēzekne City Council:

Projects co-funded from European Union structural funds:

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