Portal de Totana
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The Plenary Session of the Totana City Council agreed in its last ordinary session, with the votes in favor of the PSOE and Ganar Totana-IU and the abstention of the PP and the non-attached mayor, approve the formalization of two long-term credit operations, with the managing financial entity of the ICO, in the area of ​​the Fund of Ordination to which the totanero Consistory of Financial Sustainability Measures is attached for financial needs of the year 2018.
The councilor of Finance, Ana María Cánovas, explained, at a press conference, the mayoral proposal that was approved last Thursday in the ordinary plenary session, within the scope of the Ordinance Fund of article 39.1 A and B of Royal Decree 17 / 2014 of December 26 of Measures of Financial Sustainability of the Autonomous Communities and Local Entities charged to the Fund for the year 2018.
The two transactions to be formalized, for the purpose of processing, are one for a maximum of 1,861,143 euros (judgments and coverage of loans) and another of 5,891,078.72 euros (loans and withholdings on the participation of State Taxes) , referred to amounts derived from the maturities of operations refinanced in financial prudence;
with a term of amortization of ten years with two deficiency until January 31, 2028.
The mayor reported that this process means that the Ministry of Finance has been requested to cover the loans that this City Council has with the banking entities and which it has to face this year, for an amount of approximately three million euros.
In this file is also requested to the Ministry to pay the figure of 1,575,136 euros from judgments that have fallen against the City of Totana during the year 2017, as specified.
The Councilor of Finance recalled that this request is not new to the Consistory, given that the City is covered by these lines and extraordinary financing measures with the Ministry, whose conditions have a repayment term of ten years with two deficiency until 31 January 2028, and an interest rate of around 1%.
Adhesion to the Fund of Ordination in 2015
The City Council of Totana approved in July 2015 the accession to the aforementioned Fund of Ordination, by which the municipalities could accept that can not finance or renew their credit operations in conditions of financial prudence with banking entities;
so "now there is no new adjustment plan or increase of measures," said the mayor.
Ana María Cánovas justified the need to benefit from this line of funding given that "the city council is a living entity in which we must meet the needs of citizens and services, which involves staff costs, investments and maintenance, and our budgets of 24 million euros are limited and we do not have the remainder to pay financial debt from other legislatures, plus all the judgments that have fallen on this town hall amounting to 13 million euros ".
He also defended the convenience of adhering to this measure because, as he said, "there is no other, because it is a way to get out of this financial debt in the long term, since what the municipality has to pay in a year now, we are going to pay in ten ";
and added that "if we do not welcome, we could not offer services that are necessary and priority, since the citizen is not to blame for the previous mismanagement in this town hall."
"We have no choice but to accept this measure so as not to block the services and to be up to date with the Social Security, the Treasury, the payrolls of the personnel and the suppliers, since otherwise, we would not receive subsidies from other administrations, and we would have a very serious problem, "he added.
In addition, this plan allows obtaining liquidity to be able to face the maturities derived from the debts that under the mechanism of financing the payment to suppliers, which were being subject to compensation through the corresponding withholdings in the Participation in the State Taxes.
In the same way, these Ordination Funds are also aimed at obtaining liquidity to pay the negative settlements and that were also subject to withholding in the Participation of the State Taxes, as well as to face the execution of final judgments pending payment City Hall.
These accessions also entailed the simultaneous approval of an Adjustment Plan which contained the living debt that the Consistory had, as well as the projections of the different municipal economic indicators in application of the measures quantified in said plan.
FMRM Local Financing Conference
The councilor of Finance reported that she and the mayor attended last week a day that was held in Murcia, organized by the Federation of Municipalities of the Region of Murcia (FMRM), on the new lines for Local Financing;
and advocated that the Government of the Nation offer measures that allow the payment of the debt in the very long term.
In this regard, explained that the State Government commissioned a study to a committee of experts on financing, composed of five technicians and five representatives of the Federation of Municipalities and Provinces, to decide the measures to be implemented in this matter;
and reiterated that "for Totana it is a priority to receive this financing to offer services and reduce the financial debt", so he wished that "this study with the application of measures is not in a corner".
Source: Ayuntamiento de Totana
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