Government set to take over Budapest development efforts

Hungarian version of the article: Átvenné a kormány a budapesti fejlesztéseket

October 16, 2020 at 10:00 AM

The government would prefer to take over development projects towards which the City Council has requested 55 billion HUF from the state. The plan was revealed as yesterday's sitting of the Budapest Public Works Council. The projects in question include the Biodome and the funicular planner for Gellért Hill. An agreement is yet to be reached regarding these plans. However, the government is already set to take over the development of the H2 suburban railway line to Gödöllő, and its connection to the M3 metro. The extension of the Buda tram network on Műegyetem Embankment is also to be funded by the state. The government has also blocked the city's plans to take a loan from the European Development Bank and the introduction of the so-called restart tax. The 6 billion HUF needed for the renovation of Chain Bridge will be transferred to the city when all other funds required for the project have been secured.

The MTI reports that the government viewed talks at the Budapest Public Works Council (KFT) successful, while the City Council believed that no major progress had been achieved. The Secretary of State for the Development of Budapest and the Agglomeration said that the sitting had been a success for the residents of Budapest.

Balázs Fürjes added: plans for the government to provide 6 billion HUF funding towards the renovation of Chain Bridge were confirmed as the sitting, f the city guaranteed that the bridge would be closed for no more than 18 months. The funding will be provided when it is the only sum missing towards the work.

The Council also agreed on the need to renews the pest Embankment, and that the city should have the right to comment on the areas designated as rust belts in the capital. Budapest is also to hand over the plans for the connection of the H2 suburban railway line with the M3 metro, and the government will continue working on these plans.

The Council also agreed that the state would fund the construction of a new branch of the Buda tram network on Műegyetem Embankment, while the capital will provide funding to the development of the Transport Museum. No agreement was reached, however, on the development of the outer ring road and the City Park projects, stated Balázs Fürjes.

No agreement regarding traffic on the outer ring road was reached (Photo: Wikipedia)

The Secretary of State added that the government requested that the capital restore the original two-lanes for vehicles on the outer ring road and that the city should conduct the "omitted public dialogue" and "missing professional preparatory work," adding that no bike lanes should run on the pavement.

Mayor Gergely Karácsony, however, made it clear he would no accept this request, said Mr Fürjes. he also added that the Mayor's view of the Liget project had not changed, and he would accept no further buildings in City Park. Mr Karácsony also rejected the proposal for the creation of a professional working group to reach a solution of compromise.

The Secretary of State also said that consultation regarding projects in the capital to be funded through the 2021–2027 funding cycle of the European Union (EU) had begun. Regarding the government's willingness to take over development projects from the city, Mr Fürjes hoped that the Council would accept the plans.

The proposal is currently connected to the project, towards which Budapest has requested 55 billion HUF in state funding: the Biodome, the Gellért Hill funicular the embankment and the Buda tram network development.

Visual plan for the Biodome (Photo: MTI/Zoltán Balogh)

Mr Fürjes confirmed that the government does not support raising new taxes, austerity measures, or loans. Instead, the government offers to take over projects from the capital to finance them centrally. This would expand the budgetary opportunities open to the city, added Balázs Fürjes.

Commenting on the financial plans laid out by the capital, the Secretary of State said that the government would not support the city in increasing its debt with a further 70 billion HUF, in burdening businesses in the city with a Karácsony-tax, or by cutting its solidarity contribution.

The government would also not provide an additional 55 billion HUF of funding above the hundreds of billions already provided to the city. Ambrus Kiss, deputy-mayor, said that no agreement had been reached on major issues at the FKT sitting.

The main issue for the capital is how Budapest will remain operational, as it is currently on an "unsustainable path." The deputy-mayor added that the decisions amounted to the government not withdrawing the Budapest-tax, which will draw 40 billion HUF from the city's budget in 2020, 2021 and 2022, that the government would not allow the city to raise a restart-tax, or allow the city to draw development loans from the European Development Bank.

Mr Kiss said that due to the economic crisis, the COVID-19 epidemic and government austerity measures a hole of 150 billion HUF had been opened in the 2021 and 2022 Budapest budgets. The compromising offer slated by the government had not yet been discussed as no decision regarding it can be reached in its current form.

Andrus Kiss added that loans from the European Development Bank would have been used to purchase trams and trolley busses. Regarding Chain Bridge, he said that the government would most likely be required to provide the funding in 2022.
Summarising the meeting, the deputy-mayor said that no mayor step forward had been made, but negotiations were at least underway.

Mr Kiss also said that the government had decided to go ahead with the construction of the Hermina parking garage, and would thus not turn these funds towards the Biodome. Commenting on this, Balázs Fürjes added that while this was true, the government would take over the development project from the city, if requested.

In response to a question regarding the restart tax, Mr Kiss added, that without a change to current laws, there was no way to move forward with the plan, and the Council would have to draw up a new path.

Source: MTI

Cover photo Chain Bridge (Photo: Balázs Both/pestbuda.hu)


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