Mayor Nino Haase and Deputy Mayor and Finance Commissioner Daniel Köbler presented the administration’s draft budget for 2027 for the state capital of Mainz today. In light of the nationwide financial crisis facing local governments in Germany, the city administration sees the need for yet another round of extensive cost-cutting measures. At the same time, the administration is currently forced to propose another increase in taxes, contributions, and fees to the city council. This results in a package of measures that will reduce the budget burden by approximately 42 million euros as early as 2027.

Despite this extraordinary effort, the scale of which exceeds the austerity packages of previous years, the City of Mainz must plan for a deficit of over 233 million euros in the operating budget and a deficit of approximately 311 million euros in the capital budget for 2027.

Maintaining the City of Mainz’s capacity to act is the top priority

“Our top priority is ensuring that the City of Mainz remains capable of acting despite the nationwide financial crisis facing local governments,” emphasize Mayor Haase and Finance Commissioner Köbler. “With this action plan, we are once again presenting extensive cost-cutting measures and revenue-increasing initiatives. Our goal and expectation is that the state’s local government oversight authority will approve the 2027 budget, thereby clearing the way for us as a city to fulfill our responsibilities and services to our citizens, to move forward with essential investment projects, and to initiatives, and projects that hold our city together.”

 Mayor Haase: Tax increases would be unreasonable; the city’s long-term viability must not be jeopardized

 Mayor Nino Haase: “Further tax increases would be an imposition on the citizens of Mainz. We are now expected to bear the brunt of federal and state-specific problems in financing and legislation at the local level across Germany—this is impossible and, moreover, a slap in the face to council members, most of whom serve on a volunteer basis. We expect the state government to provide clear statements—useful for our current budget planning—regarding the announced financial support and approval procedures by the end of September. In addition, I will coordinate with the other cities in Rhineland-Palatinate and the Rhine-Main region, because under no circumstances should tax increases jeopardize Mainz as a location and its long-term viability or place an excessive burden on its residents. Politically, in my view, it is not justifiable—given all the efforts of recent years—to now force the Mainz City Council to adopt top tax rates compared to similar cities.”

Finance Commissioner Daniel Köbler: Maximum effort through targeted measures without drastic cuts

Mayor and Finance Commissioner Daniel Köbler: “With this consolidation package, Mainz will remain capable of shaping its future and taking action in 2027 and beyond. At the same time, the federal and state governments must finally initiate reforms so that municipal deficits do not continue to grow, so that municipalities can manage their finances and invest sustainably, and so that we do not leave a mountain of debt for future generations. In this way, we are also demonstrating to the municipal supervisory authority that we are making the greatest possible effort—as it has demanded—to reduce the budget deficit. The administration did not take the easy way out, nor did it pursue a policy of across-the-board cuts. Rather, we have systematically identified potential areas for savings and taken care to spread the burden across many shoulders, ensuring that no facilities are closed and no important policy measures are jeopardized.”

Causes of the financial crisis: Rising social spending and insufficient support from the federal and state governments

The city of Mainz’s budget planning is marked by the financial crisis facing local governments, which affects cities and municipalities throughout Germany and has now reached historic proportions. By 2025, municipalities had suffered a funding shortfall of nearly 32 billion euros—the highest ever in the history of the Federal Republic of Germany.

The primary cause of this lies in the federal and state governments’ transfer of responsibilities to local governments without adequate compensation for the resulting additional costs. Only through strict adherence to the principle of connectedness and a reliable baseline level of funding for local governments can the current situation be improved in the coming years.

Another cause, affecting the city of Mainz in particular, is the insufficient allocations from the state. Due to high trade tax revenues in 2021 and 2022, the city of Mainz received no formula-based allocations from 2023 to 2026—and virtually no allocations for investment projects (such as school construction and urban development). Even under the new funding programs “Emergency Program for Proactive Municipalities” and “Rhineland-Palatinate Plan Special Fund,” the state capital was placed at a significant disadvantage compared to other municipalities due to its high financial strength at the time—a situation that has long since ceased to exist. Starting in 2027, the city of Mainz is expected to receive key allocations again, but only about two-thirds of the amount it received before the reform of the municipal financial equalization system.

Package of Measures: Additional Savings and Revenue Increases Totaling 42 Million Euros

In addition to the measures already adopted in the 2025 and 2026 budget plans, the administration recommends numerous consolidation measures in the 2027 budget. These are summarized in the attached table.

Current requirements from the municipal supervisory authority necessitate further tax increases

The Supervisory and Service Directorate (ADD), as the local government supervisory authority for the City of Mainz, has issued extensive requirements for budget consolidation, in particular a reduction of the planned budget deficit by 20 million euros annually in the fiscal years 2026 through 2028 —with the exception of the increase in social services expenditures, which is beyond the City of Mainz’s control. Despite all efforts to cut costs, it will not be possible to meet these ADD requirements in 2027 either, due to the broader conditions across Germany.

To avoid a blanket rejection of the budget by the ADD, tax increases were factored into the plan: The assessment rate for business tax was already raised from 310 to 460 percentage points in 2025. For 2027, the current budget plan calls for a further increase of 10 percentage points to 470 percentage points. For Property Tax B, an increase in the assessment rates by an additional 120 percentage points is planned. Accordingly, the assessment rates will rise to 600 percentage points for residential properties and to 840 percentage points for non-residential properties and undeveloped land.

Investments in 2027: Focus on Completions and Urgently Needed Measures

Compared to previous years, investment projects were assessed according to significantly stricter criteria regarding their high priority and short-term feasibility; consequently, significantly fewer measures were included in the 2027 budget plan. These primarily include investment projects that are already in the bidding process or under construction, those urgently needed to maintain operations, or projects that are financially viable. These include ongoing construction projects such as the expansion of the Peter-Härtling School, the new Mombach School Center, the new IGS Europa, the new Gutenberg Museum building, and the City Hall renovation.

As a result, the investment credit requirement was reduced from 223 million euros in the 2026 budget to 153 million euros in the 2027 budget.

Appendix: Consolidation measures planned in the City of Mainz’s administrative draft budget for 2027