Göttingen: Financial Policy in 2026 – Between Deficits, Investments, and Reforms

Göttingen in a Budgetary Tight Spot: How the City is Managing Deficits and Investing

The financial situation of the city of Göttingen has become increasingly strained in recent years. The double budget for 2025/2026 was already planned with a significant deficit at the time of its adoption—yet reality has exceeded even these expectations. In February 2026, the city had to adopt a first supplementary budget to cushion growing revenue shortfalls and increased expenses. At the same time, Göttingen is relying on increased investments, new tax revenues, and an updated budgetary stabilization concept to remain financially stable in the long term.

Budget Deficits and Rising Debt Burden

The financial report of January 30, 2026 clearly showed: The city of Göttingen has fallen into a budgetary crisis. Business tax, value-added tax, and property tax B brought in less than originally planned. In addition, losses from investments in the millions were recorded. The per capita debt of the city stood at 3,935 euros at the end of 2025, a clear signal of the strained financial situation.

The budget shortfall in 2023 amounted to 103.28 million euros. Although the city generated a regular surplus of 27.9 million euros, this was not sufficient to offset the deficits. The city’s debt rose to 158.81 million euros, while reserves grew to 282.81 million euros—mainly due to increasing pension obligations.

Investments and Loans: Göttingen Invests Despite the Deficit

Despite the strained budgetary situation, Göttingen decided in February 2026 on a loan authorization of 65.26 million euros and a commitment authorization of 113.57 million euros. The city is investing in the areas of water sanitation, electromobility, IT, and fire protection. The Göttingen Utilities and Transport Company (GöVV) also plans investments in public transport and district heating, which are expected to rise to up to 18.2 million euros per year by 2030.

However, loan takings will not only be covered by investments. The city also increased its liquidity reserve to cushion short-term bottlenecks. Loan repayments remained stable compared to the previous year, but interest costs increased due to the high loan volume.

New Tax Revenues and Structural Reforms

One of the central measures of the city of Göttingen is the introduction of a tourism tax starting in 2027. This fee on hotel and vacation rental stays is expected to generate 1.575 million euros annually. The administrative costs are estimated at 105,000 euros per year. In addition, supplementary motions were discussed in the finance committee, considering further revenue alternatives such as a tourism fee or a packaging tax.

In the long term, the city plans to reduce the structural deficit of 92 million euros through various measures. These include the repurchase of privatized municipal utility shares, the establishment of a citizen loan program, and collaboration with the Göttingen Sparkasse on investment funds.

Budget Stabilization Concept 2026–2029: How Göttingen Aims to Remain Financially Stable

In February 2026, Göttingen decided on the revision of the budget stabilization concept for the years 2026–2029. The financial plan assumes that tax revenues will rise slightly by 2029, especially business tax. Value-added tax revenues, however, are declining. In addition, dividend earnings are expected to fall, particularly from the GöVV, whose investment income is expected to decline from 12.61 million euros to 7 million euros.

The investment planning has been adjusted to real needs. Central projects include the renovation of the city water supply, the expansion of electromobility, and the digitalization of the administration. At the same time, the financial assets portfolio is being gradually adjusted to ensure stable returns in the long term.

Conclusion: Göttingen in Financial Transition

The financial policy of the city of Göttingen stands at a turning point in 2026. The strained budget situation and rising debt burden are forcing the city to push forward with reforms. At the same time, Göttingen is relying on investments to secure the city’s future. The introduction of the tourism tax, the adjustment of the budget stabilization concept, and the realignment of the investment strategy are key steps in this direction. Whether these measures will be successful in the long term depends on how well the city can manage financial risks and use the period of change to its advantage.