Riga, Nov 5 (LETA) - The daily maintenance of streets in Rezekne may be jeopardized due to unpaid debts of the municipality, the municipality's interim administration head Guna Puce said at the meeting of the Saeima public administration and local government committee on Tuesday.

She admitted that when the interim administration started working in the city, the financial situation was critical and even a EUR 4 million government loan did not save the situation. 

The municipality still owes Arcers builder for the construction of the recreation center. The amount, including penalties, is around EUR 0.5 million, Puce said. "Constructive negotiations" are underway with the company to divide the payment into instalments and continue next year.

Puce admitted that the implementation of the municipality's core functions is also in a dangerous situation at the moment, with accumulated penalties for routine street maintenance work. The situation has recently come to light "in all its glory" and a departmental investigation has been launched in the responsible administration. 

"In general, it can be said that there was a practice of postponing the solution of problems," Puce described the management style of the dismissed council, citing as an example the postponement of last year's invoices for payment this year.

Interim administration member Iveta Mietule said that not all municipal institutions are ready to understand the situation when working on next year's budget, so there are still areas where spending needs to be assessed.

Mietule said that next year's personal income tax revenue in the municipality is forecast to be about EUR 1 million higher, but this is not much in the context of overall spending.

"Neither the residents nor the staff have realized the seriousness of the situation," commented interim administration member Janis Belkovskis.

As reported, on June 20 the Saeima adopted in final reading a law on the dissolution of the Rezekne City Council. The interim administration of the Rezekne City Council started its work in early July.