Program for the improvement of financial condition and development of the Solec Kujawski commune

“Program for the improvement of financial condition and development

of the Solec Kujawski commune”

Program for the improvement of financial condition and development of the Solec Kujawski

commune

Goalsdirect goal – improve the financial condition and the

effectiveness of managing the commune,

long-term goal – strengthen the commune’s ability for development.

SOLEC KUJAWSKITIME FOR A CHANGE

DETERMINANTS OF SOLEC DEVELOPMENT AND MAJOR CHANGE FACTORS IN

RECENT YEARS

• Demography

• Economy and job market

• Quality of life

• Financial condition

DEVELOPMENT DETERMINANTS AND MAJOR CHANGE FACTORS IN RECENT YEARS

DISADVANTEGOUS FACTORS• lower level of education in Solec as compared to

Bydgoszcz and Toruń,• limited borrowing power,• planned budgets overloaded with repayments of

liabilities,• increase in current expenditure, with no simultaneous

rise of income, in the divisions of: education, culture, sport and recreation, real estate management and social care,

• degradation of town center,• decrease in the number of students.

AVERAGE RESULTS OF PRIMARY SCHOOL TEST IN 2005

SOLEC KUJAWSKI 27.26 ( 28.32 AND 25.66)

CITIES OF MORE THAN 100 000 INHABITANTS 30.47

TOWNS OF UP TO 20 0000 INHABITANTS 28.64

CITY OF BYDGOSZCZ 30.9

CITY OF TORUŃ 30.8

AVERAGE RESULTS OF MIDDLE SCHOOL EXAM IN 2005

HUMANITIES MATHEMATICS

SOLEC KUJAWSKI 30.32 20.75

CITIES OF MORE THAN 100 000 INHABITANTS

34.68 25.70

TOWNS OF UP TO 20 0000 INHABITANTS

32.23 23.00

CITY OF BYDGOSZCZ 35.00 26.00

CITY OF TORUŃ 35.1 26.1

Limited borrowing power

2003 2004 2005 2006

credit tranche 560 942 2 646 345 3 570 633 5 060 993

interest 405 969 265 859 568 078 700 000

capital payments 1 373 381 1 282 739 1 593 571 2 693 903

debt balance 8 514 459 9 773 867 12 701 035 15 068 125

2003 2004 2005 2006

total debt/income 33.2 33.5 42.5 42.8

total debt/income service 6.9 5.3 7.2 9.4

No

Repayment type

Yearly repayments of liabilities planned

2006 2007 2008 2009 2010 2011

1 2 3 4 5 6 7 8

1 Redemption of shares issued by local government authorities 1 000 000.00 1 500 000.00 15 000.00

interest 272 594.00 100 513.00 50 256.00

2

Credit repayments:

long-term credits 717 332.00 1 857 666.00 1 680 000.00 1 780 000.00 1 356 000.00 934 000.00

Interest 203 386.00 263 882.00 198 406.00 140 352.00 67 847.00 19 207.00

3

Loan repayments

long-term loans 1 092 493.00 1 322 092.00 1 647 080.00 801 704.00 420 000.00

interest 134 865.00 114 568.00 60 552.00 15 327.00 2 106.00

4 Prospective amoounts of repayments due to guarnatees issued 577 832.00 377 832.00 177 832.00 103 832.00 52 941.00 52 941.00

5

Total 3 998 502.00 5 536 553.00 3 829 126.00 2 841 215.00 14 102 894.00 1 006 148.00

03/04 04/05 05/06

Current expenditure 7 480 925 8 161 742 9 132 210

Capital expenditure 0 5995 9175

Subsidy per student 2781 3138 3222

Total subsidy 5 610 757 6 093 569 6 070 772

Increase in expenditure with no simultaneous rise of income –

education

06/07 07/08 08/09 09/10 10/11 11/12 12/13 13/14

Current expenditure 9223532 9315767 9408925 9503014 9598044 9694024 9790965 9888874

Subsidy per student 3286 3369 3453 3539 3628 3718 3811 3907

Predicted total subsidy 5921372 5956392 5797587 5757953 5735868 5722002 5632658 5817523

Commune’s own resources on education 3302160 3359375 3611338 3745061 3862176 3972023 4158307 4071352

Increase in expenditure on education

Increase in expenditure

Solec Cultural center 2003 2004 2005

Total incomeincluding:- budget grant

Total expenditureincluding:- personal expenditure - material expenditure

777 880.33

570 000

850 023.72

491 372.12358 651.60

846 741.12

668 000

939 826.25

545 907.03393 919.22

903 827.84742 100

951 802.71

550 810.68400 992.03

Increase in expenditure

Sport and Recreation center

2003 2004 2005

Total incomeTotal expenditureincluding:-personal expenditure - material expendture

206 369.88778 213.27

317 298.62460 914.65

224 776.26799 921.33

327 798.97472 122.36

219 728.81838 295.81

350 044.90488 250.91

Additional expenditure expected – indoor swimming pool

2006 – PLN 300 000 2007 and beyond – PLN 600 000

Decrease in the number of students

Number of primary and middle school students in the years 2007-2014 - predicted from the year 2007/2008 onwards

0140280420560700840980

1 1201 2601 400

Szkoły podstaw ow e 1 390 1 376 1 303 1 250 1159 1115 1087 1043 1022 1021 1016 968 962

Gimnazjum 684 687 714 692 725 687 681 636 605 560 523 510 527

01/02 02/03 03/04 04/05 05/06 06/07 07/08 08/09 09/10 10/11 11/12 12/13 13/14

Primary schools

Middle schools


ADVANTAGEOUS FACTORS

• increase in the number of job positions and companies’ income,

• increase of number and income of employed persons,• commune’s clear spatial structure,• improvement in the quality of public services,• improvement of the Solec image,• increase in the number of inhabitants,• modernisation and enlargement of commune’s assets,• increase in commune’s own income.

Increase in the number of job positions

Number of job positions in Solec Kujawski (acc. to

PIT 4)

2000 3227

2001 3117

2002 3060

2003 2978

2004 3115

Improvement in the quality of public services

• Technical infrastructure• Sports hall and swimming pool• Culture center• Healthcare• Roads

Improvement of the Solec Kujawski image

• PR co-operation• Sporting and cultural events• Industrial estate and new companies• Incubator• Attractive offer of new residential areas

Increase in the number of inhabitants

1988

1994

1995

1996

1998

2000

2001

2002

2003

2004

2005

Liczba ludności

1345914405 144581451914641155561559315743159081595615968

0

20004000

6000

8000

10000

12000

14000

16000

18000

20000

Liczba ludności Solca Kujawskiego w latach 1988-2005

Liczba ludności 13459 14405 14458 14519 14641 15556 15593 15743 15908 15956 15968

1988 1994 1995 1996 1998 2000 2001 2002 2003 2004 2005

Solec Kujawski population in the years 1988-2005

Population

Population

20002001 2002

20032004

Działalność gospodarcza

Osoby praw ne040000008000000

12000000160000002000000024000000280000003200000036000000400000004400000048000000

Wielkości dochodów - działalność gospodarcza i osoby prawne

Działalność gospodarcza 15667944 16194792 16540777 18297326 23673565

Osoby praw ne 19514641 11929745 13837179 18148646 32865043

2000 2001 2002 2003 2004

Increase in the companies’ profits

Income levels – business activity and legal entities

Legal entities

Business activity

Business activity

Legal entities

Dochody mieszkańców wg źródeł przychodów w Solcu Kujawskim

0110000002200000033000000440000005500000066000000770000008800000099000000

110000000

2000 2001 2002 2003 2004

2000 92540121 31428484 3047982 1213307 15667944 3557064

2001 96479274 35117111 3305479 1046303 16194792 3993133

2002 95399616 36319248 4000655 458095 16540777 5086841

2003 94644787 39016900 3793772 415205 18297326 5577076

2004 101557544 42647937 3812147 436770 23673565 4492456

wy nagrodzenia renty i emery tury dział. Wy k. Osobiście kapitały pieniężne dział. Gospodarcza inne źródła

Increase in the population’s income Population’s income by source in Solec Kujawski

Remunerations Pensions Business activity Other sourcesCash capitalPersonal activity

Gross pay(in PLN)

Tax base(in PLN)

Advance income tax payment

(in PLN)

Annual income tax

(in PLN)

Tax paid to the

commune (in PLN)

899.10 629.00 18.70 224.40 80.78

1000.00 711.00 28.00 336.00 120.96

1200.00 873.00 46.00 552.00 198.72

1500.00 1117.00 74,00 888.00 319.68

2000.00 1524.00 119,00 1428.00 514.08

250000 1930.00 165,00 1980.00 712.80

3000.00 2336.00 211.00 2532.00 911.52

3500.00 2743.00 257,00 3084.00 1110.24

4000.00 3149.00 649.00 7788.00 2803.68

5000.00 3962.00 829.00 9948.00 3581.28

6000.00 4775.00 1010.00 12 120.00 4363.20

Advance oincome tax payment in relation to gross pay level (in PLN)

0,00 zł

1 000,00 zł

2 000,00 zł

3 000,00 zł

4 000,00 zł

5 000,00 zł

6 000,00 zł

7 000,00 zł

1 2 3 4 5 6 7 8 9 10 11

Płaca brutto podatek do gminyGross pay Communal tax

Increase in the commune’s own income

Budget income of the Solec Kujawski commune in the years 2003-2006 (in PLN)

2003 2004 2005 2006

Own income 12 886 164 12 985 634 13 271 694 13 724 404

Share in taxation contributing to national budget income

3 407 831 4 601 746 5 276 911 6 193 839

general subsidies 6 543 432 6 905 708 6 584 171 7 344 717

targeted grants 2 830 672 4 719 030 4 740 859 7 953 070

TOTAL 25 668 099 29 212 118 29 873 635 35 216 030

Modernisation and enlargement of commune’s assets

• Complex reinforecement of residential areas• Sport and Recreation center• Industrial estate and incubator• Town buildings modernisation

•economic and job market transformation, decrease in the income of inhabitants, companies and the commune;•taking up ambitious investment effort to make up for past deficiencies and set up basis for future development;•investments destined to serve future generations are financed from the budgets of the „transformation period”, i.e. the budgets overloaded with ever rising expendtiture on education and social sector, intended to minimise the negative effects of economic restructuring;•commune management system lacking a midterm planning instrument coordinating strategy with annual budget implementation

and integrating activities within the scope of different sectors.

Threats to the commune result from the simultaneous occurence of the following:


THREATS

Solec Kujawski municipality is too small to manage and further develop its assets and the scope and quality of its

services counting only on local inhabitants and businessmen.

In the years to come the increase in commune’s income due to the sale of services as well as population’s, companies’ and

asset income may prove insufficient to make up for rising current and investment expenditure and the repayment of

liabilities.

COMMUNE’S FINANCIAL FORECAST BASED ON CURRENT TRENDS


KEY PROBLEMS

• Improvement of the education quality and extension of its scope (kindergartens, primary, middle and high schools as well as continuing education and entrepreneurship). Adjusting the education offer to the needs of young and adult population of Solec.

• Improvement of internal and external communication system, especially a safe level crossing over the railway passing through the town.

• Turning Solec towards the Vistula river; revitalisation of the town.• Integration of the whole cultural-recreational-sporting complex;

modernisation and expansion of buildings (Cultural center, football pitch, skating rink).

• Industrial development (Industrial Estate).• Modernisation of the technical base of public services (schools and

libraries); setting up a platform for electronic services.• Monitoring economic events in the commune.• Development of market services (restaurants, hotels)


OPPORTUNITIES

• attract customers from outside of Solec for services with a “surplus” of supply,

• attract new inhabitants,• attract new students for local schools,• create new job positions,• improve the effectiveness of commune management

and the use of its assets.

Attract new inhabitants

In the estimation of increase in income due to this factor the following assumptions have been made for the purpose of this forecast:

Attracting 40 families/year (2+1 child) with monthly income of PLN 4000 Attracting 10 families/year (2+1 child) with monthly income of PLN 8000 Attracting 10 families/year (2+1 pensioner) with monthly income of PLN 9000

2007 2008 2009 2010 2011 2012 2013

The commune’s total annual share from the personal income tax 171 300 344 313 519 056 695 546 873 802

1 053 840

1 235 679

Forecast variant 06/07 07/08 08/09 09/10 10/11 11/12 12/13 13/14

Students Primary schools 1115 1121 1105 1112 1136 1154 1125 1134

Middle school 687 697 669 650 617 590 588 615

Students total 1802 1818 1774 1762 1753 1744 1713 1749

Divisions Primary schools 45 45 45 45 46 47 46 46

Middle school 28 29 28 27 26 24 24 25

Divisions total 74 74 72 72 72 71 70 71

Primary school teachers Full-time 82.74 83.18 81.99 82.51 84.29 85.63 83.48 84.14

Part-time 1.68 1.69 1.67 1.68 1.72 1.74 1.70 1.71

Primary schools total 84.42 84.87 83.66 84.19 86.01 87.37 85.18 85.86

Middle school teachers Full-time 54.96 55.76 53.52 52.00 49.36 47.20 47.04 49.20

Part-time 3.08 3.12 3.00 2.91 2.77 2.64 2.64 2.76

Middle school total 58.04 58.88 56.52 54.91 52.13 49.84 49.68 51.96

Primary & middle school total 142.46 143.76 140.18 139.11 138.13 137.22 134.85 137.81

Attract new students for local schools The variant assumes addmission to primary schools and the middle school in Solec Kujawski of 50 new students annually.

Attract new students for local schools

Forecast variant 06/07 07/08 08/09 09/10 10/11 11/12 12/13 13/14

Current expenditure 8731271 8818584 8906770 8995838 9085796 9176654 9268421 9361105

Investment expenditure 0 0 0 0 0 0 0 0

Subsidy per student 3286 3369 3453 3539 3628 3718 3811 3907

Predicted total subsidy 5921372 6124842 6125622 6235718 6359884 6484192 6528243 6833343

Commune’s own resources on education 2809899 2693742 2781148 2760120 2725912 2692462 2740177 2527762

PRIORITIES AND INDICATIONS OF THEIR ACCOMPLISHMENT

• Integration and improvement of commune management effectiveness,

• Increase the number of inhabitants,• Attract recipients of town services from outside of

Solec• Increase the competitiveness of companies and

develop local job market resources,• Improve asset management and prepare an

investment program.

PRIORITIES AND INDICATIONS OF THEIR ACCOMPLISHMENT

INTEGRATION AND IMPROVEMENT OF COMMUNE MANAGEMENT

EFFECTIVENESS

• Introduce a midterm, rolling strategy implementation plan,

• Introduce project management and assignment of responsibilities for the specialists and decision makers,

• Implement a system of commune’s socio-economic and financial condition monitoring and forecasting.

PRIORITIES AND INDICATIONS OF THEIR ACCOMPLISHMENT INCREASE THE NUMBER OF INHABITANTS

• Annually increase the number of inhabitants by 100/200/300 more than predicted in the forecast

PRIORITIES AND INDICATIONS OF THEIR ACCOMPLISHMENT ATTRACT RECIPIENTS OF TOWN SERVICES

FROM THE NEIGHBOURING COMMUNES

• Attract 25/50/75 students from outside of Solec annually,• Extending the scope of services and attracting 300/600/900

a day from outside of Solec by the Sport and Recreation center,

• Expand the offer of services provided by the Cultural center to include profit-making activities (eg. accommodation, conferences, trainings), allowing for the rise in profits by 50/100/150% annually,

• Develop market services in the town (eg. hotels, catering, private accommodation, student rooms for rent)

PRIORITIES AND INDICATIONS OF THEIR ACCOMPLISHMENT INCREASE THE COMPETITIVENESS OF COMPANIES AND DEVELOP LOCAL JOB

MARKET

• Increase the profits of companies by 150/200/250% of the GDP growth,

• Increase the income of inhabitants by 120/150/180% of the average national wage growth,

PRIORITIES AND INDICATIONS OF THEIR ACCOMPLISHMENT IMPROVE ASSET MANAGEMENT AND

PREPARE AN INVESTMENT PROGRAMME

• Increase the profits from commune’s assets by 15/30/50% more than predicted in the forecast,

• Reduce grants for the Cultural center and the Sport and Recreation center to 50/65/80% of the current level,

PRIORITIES AND INDICATIONS OF THEIR ACCOMPLISHMENT IMPROVE ASSET MANAGEMENT AND

PREPARE AN INVESTMENT PROGRAMME

• Increase the profits from commune’s assets by 15/30/50% more than predicted in the forecast,

• Reduce grants for the Cultural center and the Sport and Recreation center to 50/65/80% of the current level,

PRIORITY PROJECTS AND THEIR FINANCIAL IMPACT

• Prepare new areas for residence and apartment development,

• Improve the public image of Solec and prepare marketing campaigns for the town’s offers (eg. “live in Solec” or “work in Solec”),

• Expand and modernise the Cultural center (hotel, conference center, multimedia center),

• Expand the Sport and Recreation center – cryotherapy and rehabilitation, artificial pitch, park modernisation


• Program for the improvement of education standards in local schools,

• Scholarship program for talented youth,• New school, kindergarten network, continuing and

practical education cetre,• Modernisation of town library network and

establishment of Public Internet Access Points (PIAP), • Creation of a platform for electronic services in the

town (Internet network, town web portal, thematic portals, Local Operator of the Information Society - LOSI, Geographic Information System - GIS),


• Program for co-financing of the modernisation of residential resources and creation of new residential areas,

• Property to rent program,


• Social Integration center (CIS) and the social integration program,

• Service package for sportsmen, post-accident rehabilitation, for the permanently handicapped, the elderly and for mothers with little children,

• Establishment of a complex program for non-governmental organization support (tax allowances, technical and financial support, provision of places for business activity, networking),


• Establishment of the Solec development agency,• Expansion of the industrial estate,• Expansion of the incubator,• Development of the Solec business support program

(tax allowances, technical and financial support, provision of places for business activity, networking, clusters)

• Implementation of programmes for the development of workforce,


• Safe level crossing,• Development of public transport,• Integration of the public transport in Solec with that of

Bydgoszcz and Toruń (common tickets, network tickets, reduced-fare tickets).


BGK PRODUCTS

• Variant No. 1 • Variant No. 2• Variant No. 3• Variant No. 4• Variant No. 5

MAYORAND

TOWNCOUNCIL

SOCIAL PARTNERS

INTER-SECTOR TEAM

WORKING GROUP

BUDGETINVESTMENT PLANFEES AND LOCAL TAXESFINANCIAL POLICYCREDITS, BONDS

NEW REPORTON THE PRL

IMPLEMENTATION

PRLPROJECT

PRL PROJECT CONSULTATIONS

PRL APPROVAL

APPLICATION COLLECTION

ANDREVIEW

REPORT EVALUATION

AND IDENTIFICATION

OF TOWN KEY PROBLEMS

SUGGESTIONS FOR

THEPRL

PRIORITIESOF THE LOCAL

DEVELOPMENT PLAN (PRL)

PROJECT CREATION

MONITORING AND VERIFICATION

STRATEGY IMPLEMENTATION

STEP 1 STEP 2 STEP 3 STEP 4

Vision

CURRENT SOCIO-ECONOMIC CONDITION

KEY PROBLEMS

PRIORITIES •Integration and improvement of commune management effectiveness,•Increase the number of inhabitants,•Attract recipients of town services•Improve companies’ competitiveness and development of local job market resources •Asset management and investment program

GOALS

Environment condition in compliance with binding legal

regulations

Safe commune

Modern social

infrastructure Commune

promotion

Graduates

successful on the job market

Favourable conditions

for business development

PROJECTS

Documents

Program for the improvement of financial condition and development of the Solec Kujawski commune