Geneva: the economic reserve soon for the municipalities

Geneva: the economic reserve soon for the municipalities
Geneva: the economic reserve soon for the municipalities

The economic reserve will soon be a reality for the municipalities

Posted today at 5:47 p.m.

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Geneva municipalities could soon have authorization to constitute a temporary reserve. The Geneva Council of State is in any case in favor of it. This reserve would operate according to the model already in place for the canton.

The Geneva government indicated on Wednesday that it had submitted a draft amendment to the law on the administration of municipalities along these lines. This latitude to create a temporary reserve would allow municipalities to strengthen the management of their finances, estimates the Council of State.

Surplus accounts

In terms of public finances, the municipalities suffer the same hazards as the canton. In recent years, the majority of them have posted surplus accounts thanks to higher tax revenues than expected. However, municipalities are required by law to present balanced accounts.

It is therefore not possible for them, underlines the Geneva government, to use good results to develop their services. With a temporary reserve, municipalities will be able to adopt deficit budgets “up to the level of the said reserve”, specifies the cantonal executive.

A transitional provision should allow municipalities to create a temporary reserve on January 1 of this year in order to be able to have it available for the 2025 budget. Its initial amount will be calculated on the basis of 10% of the expenses of the 2024 budget of each municipality, notes the Geneva Council of State.

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