Local authorities in Offenbach district face mounting financial difficulties, struggling with growing budget deficits
In the Offenbach district of Hesse, Germany, a financial crisis is unfolding as municipalities grapple with rising costs, shrinking revenues, and increased demands for social welfare. The Association of German Taxpayers in Hesse has voiced its opposition to a proposed packaging tax, arguing that the manageable revenue it would generate is outweighed by the significant effort required to collect it.
The financial situation varies across the district. For instance, the per capita Grundsteuer-B payment in Heusenstamm is around 483 euros, while in Langen, it is 409 euros. However, the district average for the trade tax is 378 percent, which is below the Hessian average for the previous year (396 percent). The search results do not provide concrete data or explanations on the exact reasons for the financial deterioration in the district's municipalities.
Common causes for financial deterioration in city and municipal budgets include increasing social welfare expenditures, reduced revenues from taxes and fees, rising costs for infrastructure maintenance and public services, and additional burdens from climate-related policies or environmental regulations. The only somewhat related external factor noted in the search results is the financial pressure on farmers due to ecological disaster mitigation efforts in other German regions.
Among the municipalities in the Offenbach district, only Rodermark presents a balanced budget for the 2025 fiscal year. Eleven out of the 13 cities and municipalities missed the deadline for adopting their budget plans as per the Hessian Municipal Ordinance. Neu-Isenburg, however, continues to waive the Grundsteuer C tax completely, while the collection of street contributions remains in place in the district.
Jochen Kilp, chairman of the Hesse Taxpayers' Association, stated that municipalities are financially struggling due to new tasks and rising costs. In response, municipalities are being urged to set priorities, review voluntary services, and cooperate more intermunicipally.
The property tax reform required all Hesse municipalities to set new tax rates, and five of the 13 cities and municipalities in the Offenbach district exceeded the revenue-neutral values by at least five percentage points. New tax rates were also introduced for the Grundsteuer A on agricultural and forestry land, with Rodgau and Dreieich having the highest rates.
In the area of the trade tax, three municipalities increased their tax rates: Mainhausen and Seligenstadt by 23 points each, Neu-Isenburg by 15 points, and Dietzenbach remains the top performer. The introduction of a packaging tax is being discussed in Dietzenbach and Neu-Isenburg in the Offenbach district.
It is crucial to note that Heusenstamm, Langen, and Egelsbach have some of the highest tax rates statewide, with Heusenstamm having the highest at 1,327 percent above the state average. Three municipalities continue to collect recurring street contribution fees, while they are not applied in ten communities in the district.
As the financial situation of cities and municipalities in the Offenbach district continues to deteriorate, it is essential for local governments to address these challenges head-on and seek solutions to ensure the long-term financial stability of their communities. Consulting official district financial reports or local government analyses would be necessary for detailed, current information specifically about Offenbach district’s municipal finances and the exact additional burdens.
Economic and social policy reforms are vital to address the financial struggles of municipalities in the Offenbach district, such as setting priorities, reviewing voluntary services, and cooperating intermunicipally. This could potentially help alleviate increased social welfare expenditures and social demands, while also producing revenue through adjustments in finance, such as trade tax rates or the proposed packaging tax in Dietzenbach and Neu-Isenburg.
