Wichtiger Hinweis
FAQs on the budget
Stand: 27.05.2025
Answers to frequently asked questions about the tight budget situation.
The budget situation of the city of Erlangen is tense due to a significant, unforeseeable slump in trade tax revenue. In response to this, the city has already imposed a budget freeze for investments, material resources and personnel amounting to 14 million euros for 2024. The city will also have to deal with lower tax revenues in 2025.
The administration has drawn up a budget consolidation concept in consultation with the government of Middle Franconia (supervisory authority). The city council adopted a comprehensive consolidation concept at its meeting on April 30. The aim of the concept is to ensure the long-term viability of the city in a difficult budget situation.
Here: Budget consolidation concept after resolution by the city council on April 30, 2025
Here: Change in the income budget after the city council meeting on April 30, 2025
In May, the government of Middle Franconia, as the responsible legal supervisory authority, approved the investment loans applied for by the City of Erlangen for 2025. The city can continue ongoing investment measures - particularly in the areas of schools, childcare, culture and urban infrastructure. At the same time, the government's approval comes with further conditions for politicians and the administration. For example, the budget consolidation concept (HKK) must be updated every six months in future.
Answers to frequently asked questions
For the second year in a row, the city must also expect significantly lower trade taxes in 2025. This is due to the overall economic development and additional tax repayments. Trade tax revenue of 220 million euros was forecast for 2024. As taxes already received for previous years also had to be repaid, trade tax income of only 71 million euros is expected in 2024. For 2025, too, the municipal treasury expects significantly lower revenue than initially forecast.
Trade tax revenues are subject to regular fluctuations. There are therefore mechanisms in place to compensate for these fluctuations, albeit with a time lag, such as allocations from the federal and state governments. In addition, the city has reduced debt on a large scale in recent years and built up reserves.
However, losses of this magnitude caused by unforeseeable repayments are unusual and can only be offset in the medium term. As a result, the city's reserves are being depleted and the city has to work with measures such as a budget freeze as for 2024 and cutbacks. A budget consolidation concept had to be drawn up for 2025 in order to stabilize the financial situation. This concept was presented at the end of March. At its meeting on April 30, the City Council approved the budget consolidation concept.
The concept with the City Council's amendments can be accessed online:
Here: Budget consolidation concept after resolution by the city council on April 30, 2025
Here: Changes to the income budget after the city council meeting on April 30, 2025
The companies' advance payments are determined by the tax office and are binding for the municipalities. These payments are usually calculated on the basis of the previous year's assessment or on the basis of the companies' profit expectations, which they submit to the tax office. The city is in regular contact with major trade tax payers in order to be able to make adjustments to the forecasts as quickly as possible. For this reason, the city issued a budget freeze in July 2024 following corresponding discussions.
The slump in trade tax in Erlangen is not due to profound economic problems, such as corporate insolvency. Erlangen remains a stable and attractive business location. The outlook for 2026 shows that the city has the opportunity to gradually work its way out of its financial difficulties through compensation mechanisms and structural adjustments. However, savings efforts will continue to be necessary.
The city council adopted a comprehensive consolidation concept at its meeting on April 30, 2025. The aim of the concept is to ensure the long-term viability of the city in a difficult budget situation. The consolidation concept was submitted for review by the government of Middle Franconia. As the responsible legal supervisory authority, it assessed whether the concept is sufficient to ensure the restoration of an orderly budget and long-term performance, particularly in light of the massive liquidity problems. Among other things, it serves as the basis for the approval of investment loans for ongoing projects. Individual measures - such as fee increases or property sales - subsequently require further resolutions by the city council.
The government of Middle Franconia approved the investment loans applied for by the City of Erlangen for 2025 in May 2025. The city can continue ongoing investment measures - particularly in the areas of schools, childcare, culture and urban infrastructure. Lord Mayor Florian Janik: "Thanks to the great savings efforts of the administration in recent months, we can continue the ongoing projects for childcare, good schools, modern infrastructure and climate protection. That was my goal, we have achieved it and that gives us security and is therefore good news."
At the same time, the government is linking its approval to further conditions for politics and administration. The savings volume in administrative activities of 57.7 million euros by 2028 agreed by the city council in April is significantly below the target of 64.3 million euros proposed by the administration. This result has been criticized. The government is therefore demanding that the budget consolidation concept (HKK) be updated every six months in future. The government's letter states: "As a first step, the task will be to compensate for the 10.4 percent reduction in the savings volume of just under 57.7 million euros in the adopted HKK through other savings measures so that the originally planned volume of 64.3 million euros is achieved again." Furthermore, it is urged to focus on the level of voluntary services.
Head of Finance and Economic Affairs Konrad Beugel: "We have the necessary security to continue with important investment measures. At the same time, however, the administration and city council are facing further major tasks in order to implement the savings efforts that are still necessary. The next budget in 2026 will also be characterized by the difficult financial situation."
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Household
It contains the income and expenses.
Budget 2025: savings to secure investments
On January 16, the Erlangen City Council approved the 2025 budget by 27 votes to 21.
City council adopts consolidation concept
At its meeting on April 30, Erlangen City Council adopted a comprehensive consolidation concept. The aim of the concept is to ensure the long-term viability of the city in a difficult budget situation.