Velingrad Cannot Cover Payment on State Loan for Q2 2026

The municipality of Velingrad has reported an inability to repay the monthly installment on the temporary interest-free loan provided by the state for the second quarter of 2026. This is the conclusion of a report sent by Mayor Kostadin Koev to the Minister of Finance, Gulab Donov.

The report covers the period April 1 – June 30, 2026 and concerns the loan of €5,112,919 (BGN 10 million), obtained in 2025. According to the document, in the second quarter the municipality expected a positive financial effect from the measures in the financial recovery plan amounting to €834,857, but in reality only €631,299 was achieved, or 76 percent of the forecast.

“Due to the unrealized in full measure expected effect of the measures, the Municipality of Velingrad is unable to repay the installment on the state loan for the second quarter of 2026,” writes Mayor Kostadin Koev to the Finance Minister.

As of June 30, 2026, overdue municipal liabilities amount to €5,680,601, which is a decrease of €198,240 compared to the end of March and indicates some progress in limiting the liabilities. Nevertheless, the financial condition is not sufficiently stable to cover the owed installment on the state loan.

The report notes the largest lag is in the execution of certain local revenues. The tourism tax is forecast at €25,564, but only €9,809 has been collected. The collection of vehicle tax is below expectations – €219,855 were planned, but €75,406 were actually received. The sale of services, including from the blue zone, yields €8,736 instead of the expected €23,519.

There are, however, items with better performance. The property acquisition tax brought in €61,857 against planned €19,076. Unfortunately, plans to reduce spending on water, fuels, and electricity were not realized; due to price increases, expenses are €43,147 higher than projected.

As part of the measures to improve the financial position in 2026, the Velingrad Municipality has filed 58 lawsuits against debtors totaling €101,110. The mayor emphasizes strengthened control in various sectors, including tourism, and assures the Ministry of Finance that the financial recovery plan will continue to be implemented.

Source: marica.bg