Valka Municipality Council rejects financial stabilization process

The Valka Municipality Council has decided not to request the initiation of a financial stabilization process, despite ongoing financial difficulties. Mayor Vents Armands Krauklis argued that the Ministry of Finance's justifications for the process are not fully based on current facts, claiming the Ministry has access to newer data showing reduced municipal liabilities and other stabilization measures.

Krauklis expressed concern that starting the stabilization process would not address the root causes of the municipality's financial issues. He noted that instead of providing additional targeted grants, the process would result in a stabilization credit, increasing the municipality's debt and making new projects more difficult to implement.

The Ministry of Finance maintains that the municipality's financial situation is critical, noting delayed payments including tax obligations and an unbalanced long-term cash flow project. The State Audit Office has launched an in-depth revision to provide a comprehensive assessment of the municipality's actual financial situation and the causes of its difficulties. Further decisions by the Ministry of Finance will depend on the results of this audit, which is expected to be completed in approximately one month.