A substantial operating surplus is expected for the City of Hafnarfjörður.
The proposal for the 2024 budget was presented to the Hafnarfjörður Town Council for its first reading today, Wednesday, 8 November. The projected operating surplus for the municipality's A and B sections amounts to 1,894 million króna in 2024. Operating cash flow is projected to be 5.7% of total revenues, or 2,788 million króna. The plan provides for the A-section's operating surplus before depreciation and financial items to be a positive 4.1 billion króna, and for the A-section's result to be a positive 1.1 billion króna.
The financial position of the City of Hafnarfjörður is sound.
The proposal for the 2024 budget was presented to the Hafnarfjörður Town Council for its first reading today, Wednesday, 8 November. The projected operating surplus for the municipality's A and B sections amounts to 1,894 million króna in 2024. Operating cash flow is projected to be 5.7% of total revenues, or 2,788 million króna. The plan provides for the A-section's operating surplus before depreciation and financial items to be a positive 4.1 billion króna, and for the A-section's result to be a positive 1.1 billion króna.
Debt ratio estimated at 86.1% at the end of 2024
Total revenues for A- and B-sections are projected to be around 48.8 billion króna in 2024, and projected operating expenses before capital items are around 42.8 billion króna. The financial position of the Municipality of Hafnarfjörður is robust, and the debt ratio according to Regulation 520/2012 is estimated at 86% at the end of next year. The council tax rate for 2024 will remain unchanged at 14.70%, but to offset the increased property valuation, the property tax rate for residential property will be lowered from 0.223% to 0.217%. The property tax rate for commercial property will also be lowered from 1.400% to 1.387%.
Key figures from the 2024 budget
- Operating result of Sections A and B positive at 1,894 million króna
- Operating result of Section A positive at 1,031 million króna
- Debt ratio estimated at around 861% at the end of 2024
- Estimated operating cash flow from A- and B-sections of 2,788 million króna, or 5.71 TP3T of total revenue
- Council Tax percentage unchanged at 14.701%
- The rate of property tax on residential and commercial property was lowered to offset an increase in property valuation.
- A general tariff increase of 9.9% is planned to cover price and wage increases exceeding this year's forecasts and the expected inflation next year. The tariff for waste collection is generally increasing by 9.9%, but a change in the composition of residents' bins could significantly reduce this increase.
- Estimated investments amount to almost 8.5 billion krónur.
„As the municipal budget is run efficiently and the council's finances are sound, we will support residents by reducing the council tax rate for the coming year. This applies to both residential and commercial properties. Now that economic conditions in society are challenging, it is beneficial that such strict financial discipline has been maintained in the operations of the City of Hafnarfjörður in recent years.“ says Rósa Guðbjartsdóttir, the mayor. „It is positive to see that our plan provides for a substantial surplus in the operation of the City of Hafnarfjörður next year and that the municipality's debt ratio will continue to fall. Emphasis is placed on keeping borrowing to a minimum. We are achieving this whilst maintaining good services for residents and undertaking significant infrastructure development.“
Key projects for 2024
The budget for capital projects in 2024 is nearly 8.5 billion króna. The budget places an emphasis on prioritising core services, such as environmental matters, transport, sports facilities, and housing and wastewater services. Work will continue on the finishing touches of new housing developments across the town, including tarmacking, traffic safety measures, the construction of pavements, paths, play areas, and the general greening of spaces. Work will continue on the refurbishment of junctions, pavements and footpaths, as well as the renewal of older playgrounds. Special funding is being allocated to improve cycling routes. The number of neighbourhood hubs is being increased, and work will begin on their landscaping. Furthermore, an emphasis is being placed on increasing greenery in the town's neighbourhoods. Various projects, renovations and maintenance will be carried out on school buildings and grounds, in addition to preparations for a new nursery and primary school in Hamranes. The restructuring of the Town Hall building will also begin. The refurbishment of the Suðurbær Pool facilities will continue, and preparations will begin for the design of the outdoor area at Ásvallar Pool. A new clubhouse is being built at the grounds of the football club Haukar, and it is planned to be ready for use by the end of 2024. A new riding arena is also being built on the grounds of the equestrian club Sörli, and it is expected to be completed within the next two years. The construction of a hybrid grass pitch for Hafnarfjörður Gymnastics Club will be finished, and the facilities in the sports hall on Strandgata will be improved.
Budget processing
The budget for the City of Hafnarfjörður is presented for first reading at the meeting of the City Council of Hafnarfjörður on 8 November 2023. The budget covers the coming year, as well as a three-year plan for 2025-2027. The second reading and final adoption of the budget in the City Council is scheduled for Monday, 4 December 2024.