Baranya County Court launched bankruptcy proceedings against the town of Szigetvár on the initiative of the city’s only remaining deputy mayor last week. The southern town has some HUF 60 million (EUR 225,000) of defaulted debt, HUF 140 million (EUR 526,000) in unpaid bills and owes some HUF 3.5 billion (EUR 13.15 million) to various banks for the financing of its hospital, thermal bath and swimming pool projects.

After the town filed for bankruptcy, the court almost immediately appointed a company responsible for the liquidation, which will nominate a financial commissioner to take charge of Szigetvár’s finances.
The majority of city council members voted against the decision of deputy mayor Gyula Rodek, who took charge of Szigetvár after the death of mayor József Paizs. According to Rodek, filing for bankruptcy was the lawful way to go, something which the court reiterated. Other city board members said that Rodek had previously insisted that the only way for the city to avoid liquidation would be for Szigetvár to sell its heating company, which would have provided sufficient funds for survival.

“We did not believe that privatisation would solve the city’s problems”, councillor Józsefné Kapronczai said, adding that the deputy mayor had acted alone and not given the town the chance to renegotiate terms with its creditors.
Should the issue not be solved by the town council in the near future, and the insolvency procedure reversed, all of Szigetvár’s loans will turn into expired debt, which would automatically exclude the municipality from applying for subsidies for the next five years.
“The city may even have to pay back some of the funding it has already received,” one representative said.

Only registered users can write comments.
Please login or register.

Powered by AkoComment Tweaked Special Edition v.1.4.6
AkoComment © Copyright 2004 by Arthur Konze - www.mamboportal.com
All right reserved