City Council approves a debt reduction plan that cancels ICO 85 million and refinances it with banks
The government team of the City of Valencia has approved a debt reduction plan, with the support of PSPV and Compromís and the abstention of the EU, which plans to cancel the contract with the Official Credit Institute (ICO) amounting to 85 million euros to refinance it with the private banks in better conditions.
In a statement, reports that the deputy mayor, Alfonso Grau, has indicated that this operation, contracted until 2022, will save 18 million euros in interest and allow the City Council, once approved and transferred to the Ministry of Finance, to have 4.5 million corresponding to the 2015 savings "to face investments as before the crisis, with its own financing".
In this regard, the socialist mayor Pedro M. Sanchez believes that it is "an obligatory measure" because in 2013 the rule of expenditure was breached, exceeding the legal limit of 110 percent of the debt, reaching 122.06 without guarantees granted and 131.49 with guarantees ", and" it supposes more fiscal pressure for the citizens "for the" waste of the PP ".
In the Finance Committee of this Tuesday has also approved the request to extend the period of refund of the debit balances of the final settlements of the participation in the State taxes of 2008 and 2009, amounting to 120 million euros, which may be returned in a period that is extended ten years.
For the councilor of the United States Rosa Albert, "what the PP should do is request that this debt be canceled", since it obeys to "liquidations badly practiced by the Government", or "demand greater financing for local entities" to avoid the "economic insecurity" they generate and that "unbalances" their accounts.
Pending invoices amounting to 15.7 MILLION
Regarding the average term of payment to suppliers, the report corresponding to the third quarter on the compliance of terms for the payment of municipal obligations has been reported, with "577 invoices with an amount of outstanding debt of 15.7 million euros , which to date are practically already paid. "
Grau stressed that "the average period of payment to suppliers of the local entity is 30.85 days", which rises to 41.95 days if all autonomous agencies are added, and that being "more than fulfilling the average period of payment "may dedicate this savings of 4.5 million to priority issues of municipal management.
The vice mayor values having achieved "strict compliance and, on the other hand, the refinancing of the debt that will allow more liquidity", as well as having "healthy funds", with an "indebtedness ratio that would be 98% , far from the 110 percent required, and will be at 109 percent "for a short-term credit operation for the amount of 25 million that will be settled upon the introduction of the Real Property Tax (IBI).
In this regard, the US mayor has failed in a statement that "given the inability of the PP to pay bills in a timely manner has had to contract a short-term credit operation amounting to 25 million," point at which he asks himself "until when are going to approve fictitious budgets that do not gather sufficient budget items to face the current cost".
Albert has also criticized that the number of days of average payment to suppliers goes from 19 in the second quarter to 25 in the third, with a global term of 42 days, and has advanced that will require the PP "a radical turn in its policy fiscal, through progressive taxation, "to" ensure adequate income to deal with the services "that are required to provide.
The Socialist councilor has pointed out that, as of September 30, the financial debt was 843.63 million, not counting those 25 million, and has also rejected that "this year they have paid 75.45 million out of time, which have generated interest on arrears "amounting to 6.6 million as of the date of the seven budgeted for 2014.
Execution of the adjustment plan
The Finance Committee also reported on the report of the General Comptroller on the execution of the Adjustment Plan for payment to suppliers and the investment plan in water treatment plants of the EMSHI in 2014.
The councilor of the US has indicated that, as of September 30, there were 20.69 million euros of outstanding obligations to be applied to the budget, while the long-term debt amounted to 827.9 million, which "does not show the image at all. of a sound administration that meets its financial obligations up to date ".
In turn, the socialist Pedro M. Sanchez has accused the PP of "increasing the tax burden on citizens" through the Adjustment Plan to "pay bills in the drawer," with 15.18 million entered since 2013, after " years of waste, which led to a debt with suppliers of 183 million euros. "
Extrajudicial credit recognition
On the other hand, the seventh list of extrajudicial credit recognition files was approved, for 93,540 euros, for companies with activities that did not have budgetary appropriation and the seventh modification of extraordinary credits of 85 million for the approval of the reduction plan. debt.
In another order of things, the City Council will seek solutions to help owners of small businesses located in rented premises under the umbrella of the old rent law (exempt from the revaluation of the annual CPI) that will be affected by the liberalization of those rents, since the next December 31 finalizes the extension of the decree of former minister Miguel Boyer.
Grau explained that it is a "decision agreed by all groups" after the motion presented by the spokesman of Compromís, Joan Ribó, on protection of the old shops of the city.
Specifically, the City Council's legal services will study "formulas to grant aid to these professionals, from any area of the city, until they experience an economic rebalancing" and the Department of Commerce and Markets will collect, until November 30, requests for help of merchants with documentation accrediting their income and rent that justify it, with the possibility of making a loan modification to help them.
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