Ostrava’s 2018 budget

The new year’s budget brings record levels of investment, a reduction in City debt, and increased funding for municipal districts.

Ostrava will run a balanced budget in 2018, with income totalling 8.3 billion CZK (1.2 billion more than in 2017). The budget will also include surplus funds carried forward from the 2017 budget (a total 1.99 billion), which will be used mainly to finance investment projects. The total available funds in 2018 (after the deduction of loan repayments) will be 9.9 billion CZK; this sum will cover not only the City’s current expenditure, but also investments (2.9 billion CZK).

Ostrava’s Mayor Tomáš Macura summarized the achievements of the new budget:

Ostrava is in excellent economic condition. In 2018 we will have the highest budget in the past decade, totalling 9.9 billion CZK. This is partly due to more effective tax collection, but it also reflects our uncompromising determination to control our current expenditure. We will continue not only to reduce the City’s debt levels, but also to increase our subsidies to the individual municipal districts; in 2018 these subsidies will reach the highest levels in Ostrava’s history – double the figure for 2013.

Subsidies to municipal districts (CZK millions)

The City’s current expenditure in 2018 will be 6.96 billion CZK, an increase of 1.09 billion compared with 2017.

• Subsidies and reserves for municipal districts will be increased by 362 million CZK to a total 1 342 million CZK.
• As a result of legislative changes, wages paid to employees of the City and its contributory organizations will be increased by 285 million CZK.
• Spending on public transport will increase by 159 million CZK, continuing to make the system increasingly attractive to users.

Deputy Mayor Iveta Vozňáková commented on Ostrava’s overall financial health:

We have managed to put together a budget which is generous to the municipal districts, enables us to launch and implement numerous important construction projects in Ostrava, and yet also helps to reduce the City’s debt by a further 500 million CZK. The total per capita debt will drop to just 7 225 CZK – which is by far the lowest per capita debt level of any major Czech city. I am confident that our ratings agency will continue to be satisfied with our prudent and sustainable financial management, and that we will retain our current A1 rating – the highest possible rating that any Czech city can achieve.

The 2018 budget will bring a further reduction of 475 million CZK in Ostrava’s overall debt (including the municipal districts), to a total debt of 2 107 million CZK. This will help to reinforce the City’s financial stability and create a strong basis for financing future development projects.

The City’s capital expenditure in 2018 will be 2.9 billion CZK. This is 778 million CZK higher than the 2017 figure, and it is the largest sum that Ostrava has ever had available for investments.

Planned investments in 2018 include:

• 466 million CZK for the modernization of the Ostrava City Hospital,
• 446 million CZK for strategic development projects,
• 187 million CZK for the reconstruction of the Jiří Myron Theatre,
• 114 million CZK for the extension of the ‘Collector B’ utility tunnel to Radvanice,
• 65 million CZK for the modernization of accommodation services at the ‘Čtyřlístek’ centre for disabled clients (phase I),
• 50 million CZK for the reconstruction of the Bazaly sports stadium,
• 42 million CZK for the ‘U Cementárny’ sports centre (phase II),
• 26 million CZK for new traffic control systems at the Sokolská třída x Českobratrská junction.

Deputy Mayor Břetislav Riger commented on the City’s plans:

In 2018 we will have almost 3 billion CZK available for investments, and this will enable us to launch work on a range of construction projects that will contribute to improved quality of life for citizens and make Ostrava an increasingly attractive destination for investments. Projects include cultural and sporting facilities, the ongoing modernization of the City Hospital, as well as social projects and traffic infrastructure. We have planned these projects in previous years, and now they are ready for implementation.

The international rating agency Moody’s awarded Ostrava its highest ever rating in 2017, raising the City from A2 positive to A1 stable. Ostrava is one of just four Czech cities to have achieved this rating. The rating reflects the City’s economic and financial stability and its reliability in meeting its financial commitments.