The amendments to the Law on Financing Local Self-Government are paving the way for an airport concession, which we oppose, the Strategy for a European and Civic Montenegro (STEGA) announced today.
"In a situation where the state budget does not have sufficient funds to regularly service its obligations without additional borrowing, the Government is resorting to centralizing local revenues. Instead of openly talking about fiscal problems, the government, under the guise of 'decentralization', 'local development' and 'fair distribution of revenues', is adopting solutions that in practice mean redirecting money from the local to the central level," the statement said.
STEGA added that "the latest amendments to the Law on Local Self-Government Financing clearly demonstrate this pattern: key sources of revenue are being centralized, and municipalities are being reduced to passive observers of the resources located on their territory."
"The amendments to the law stipulate that the entire concession fee for airports - both the fixed and variable parts - goes directly to the state budget. The municipalities of Zeta and Tivat, on whose territory the airports are located, are left without a single euro of that revenue. For comparison, for ports, local governments receive 50% of the concession fee, and for other goods of general interest 70%. Only airports are exempt from this system. Such an exception has no developmental logic - it is a fiscal expropriation of local revenues," the statement reads.
STEGA said that the Government is additionally referring to the formulation that "75% of the revenue from the fixed part of the fee will be used for infrastructure projects of strategic importance in the territory of the municipality in which the airport is located."
"However, these are not local government funds, but a discretionary fund of the state. The law does not prescribe clear criteria, procedures, or mandatory participation of municipalities in decision-making on projects. Practically, the state takes the money generated in the territory of Zeta and Tivat, and then decides through political assessment whether and how much funds to return," the statement reads.
STEGA said that "not even the variable part of the concession fee, which depends on the airport's business success, belongs to local communities."
"And that revenue is being centralized, while municipalities are left with noise, congestion, pressure on infrastructure and additional utility costs - without any fiscal compensation. All of this clearly indicates that the ground is being prepared for an airport concession through changes to the law, which we oppose. The process is being carried out quietly, through normative interventions, while the public is offered a narrative about 'strengthening local development'. In reality, it is a pure centralization of revenue and power, to the detriment of the local communities of Zeta and Tivat," the statement reads.
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