On Thursday, Tallinn City Council starts discussing next year's €1.26 billion budget. Mayor Mihhail Kõlvart (Center) said that no money was saved when the budget was drawn up. Instead, they want to borrow €125 million, because, as Kõlvart says, you have to act counter-cyclically.
"The city borrows €125 million next year. Why so little? The borrowing capacity allows for more," journalist Madis Hindre asked Kõlvart about the budgeting strategy in an interview with ERR.
"It is quite a lot, actually," the mayor said. "Investment is totaling €250 million next year, which is up 20 percent from the current year. And we have actually never borrowed so much before. I think this decision could be a model for the state."
Kõlvart said that there are sound reasons not to borrow more than that.
"There could always be even worse times ahead, and you have to be prepared for that. Not to mention that interest rates are currently not particularly favorable for borrowing," he said.
Moreover, were the city to borrow more than that, say €100 million more, "we simply would not be able to realize that much investment in a single year."
While the European Central Bank is making an effort to make people's home loans more expensive in order to reduce inflation, the government of Tallinn contends that in a time of crisis, you need to invest more.
"I think the public sector needs to take a counter-cyclical approach," the mayor said. "There is no use in fueling the market with investment while the economy is rising or at its peak. However, while it is in decline, we have to invest. And if we don't do that – companies will be unable to invest."
"I don't think the state's approach is the right one," he said.
Kurepõllu entertainment park
The explanatory memorandum to the city budget states that in the coming year, Tallinn will start developing the concept for the Kurepõllu entertainment park that will be built in Lasnamäe.
"Let's start with the fact that it's not just about carousels. We want to create a new [expansive] urban space in the same way as we did with the concept of the Linnahall," Kõlvart said.
The mayor explained that the planned space will be "so valuable that this new concept of urban space should embellish the whole city," despite the fact that it is intended for the purpose of entertainment.
And Tallinn is the right place for it, "it only makes sense that one of Europe's capitals has a unique concept for an entertainment park," he added.
"Just as it took us two years to develop the concept for the Linnahall – we tried to consider many nuances – I believe the concept of the entertainment park will take some time to mature as well, because in fact this area is very large."
The mayor said that the new concept for Kurepõllu Park has to be appealing equally to both tourists and locals. "The goal should be to build an innovative entertainment area that will entice both locals and tourists to the point where they would travel to Tallinn just for the sake of it."
Although the entertainment park is equally ambitious as Linnahall, Kõlvart said that it will progress faster.
"I think that planning will be somewhat less difficult than for the Linnahall makeover. Over the course of a year, we could already organize a competition and approach investors. So it's a project that can be done quicker, even though it is quite a big initiative."
The new largest hospital is yet another ambitious undertaking by Tallinn City. When a year ago the state withdrew its backing of the project, with which also the major EU financing was taken away, Tallinn nevertheless pledged to complete its development stage.
"We disagree with the state's choice. And the city properly anticipated this funding," he said, adding that since the state had asked to expedite the project at first, it could now at least cover the uncured initial costs.
"We think that the state should compensate us for the costs we have incurred, but the legal aspects are always more subtle, so we have to analyze the matter from a legal point of view," he said.
The hospital development plan will cost another €8 million next year.
"Next year, a preliminary design will be completed. Then we can take a break to evaluate the situation before proceeding with the construction design," the mayor said. "That was the basic plan. If time were restricted, we would work simultaneously on both design and engineering, but we don't need that now."
The budget explanatory memorandum states that the city will interconnect its bus routes next year. The merger of nine shorter routes into four longer ones sparked quite a stir.
The mayor said that it is not possible to reorganize the public transportation system in the city without lengthening some lines. "It is part of the overall concept that the city must have routes that connect different parts of the city and longer routes that bring people to these more distant locations."
"Although some decisions were most effective, there were people who did not accept them. Nothing can be done about it; it had to be acknowledged and other decisions taken," the mayor said about Pirita-Kose residents, who seemed to be ready to complain to the president about bus line number 5.
The next modifications will start with earlier communication and more cooperation, so that residents will have a very clear understanding of what, why, and where is being done, the mayor said.
Transition to teaching in Estonian
To help teachers switch to Estonian, €8.8 million has been allocated for various activities. "I think that the program that we came out with is systematic, with all the measures being interlinked and mutually supportive," Kõlvart said about about the transition implementation.
"Unfortunately, we don't not see a similar initiative from the state. We continue to believe that it is really the responsibility of the state and that state resources need to be allocated to this," he said.
"Our program also recruits and trains new teachers, something the city should not do," he added.
According to Kõlvart, the problem lies with specialized teachers. Even if the first academic year goes well, subject teachers will be even higher demand the next year, causing schools further challenges, he said.
The kindergarten teacher shortage is already very serious, he added.
Tallinn is not planning to expand municipal taxes
The state plans to expand the possibilities for municipalities to collect taxes. Tallinn is not planning to implement any additional taxes, Kõlvart said. "If local governments also introduce their own taxes in a situation where the economy is deteriorating, people's incomes are falling, the social situation is worsening, the impact would not be very unfavorable," the mayor said.
"An autonomous tax system is one of the hallmarks of municipal autonomy, but imposing taxes at a time when the economy is in recession is not, to put it mildly, very sensible. We certainly wouldn't get away with it," he said.
Greening the city's waste management facilities
Tallinn started the construction of its first circular economy center in the Kristiine district this November, with plans underway for another center on the property at Punane 68a in Lasnamäe.
Deputy Mayor Joosep Vimm said: "We are transforming our existing waste treatment plants, but there's a clear need to make these services more accessible to the public. That's why we are developing new circular economy centers. The one in Lasnamäe will be the first of a new generation, inspired by models from the Nordic countries, where circular economy principles are applied, which includes extensive use of wooden structures and recycled materials."
A circular economy center will house a waste collection facility, repair workshops, classrooms and reuse spaces, where residents will be able to refurbish or repurpose their old items with guidance from experts, using materials sourced from the waste treatment plants.
The construction of the circular economy center will use recycled materials. Plans include using reclaimed wood for the building's exterior and recycled bricks for the interior finishes.
The first circular economy center, in Lilleküla, is set to open in 2024 at Mustjõe Street 40 in the Kristiine district. Additionally, a center is planned for Haabersti, with the location yet to be confirmed. The completion of the Lasnamäe center is slated for 2025.
One of the goals of Tallinn's Waste Plan 2022-2026 is to transform existing waste treatment plants into circular economy centers.
Editor: Kristina Kersa