- 1. The position of municipalities in the government and administrative structure
- Municipalities and the state
Constitutional foundations of local autonomy
Municipalities and the European Union
- Magistrat’s constitution
Southern German council constitution – often to be encountered in eastern Germany
”Splitting tickets and accumulation”
- Municipalities and the state
- 1. Nature and tasks of the municipalities
- Municipality bodies
The municipality council and its committees
Administrative principles and administrative tasks
- Budgetary principles and the budget
Acquisition and administration of assets
Municipality economic activity
- Municipality bodies
The local autonomy of towns, municipalities and districts is a key element of modern constitutional states. It is ”local democracy”. The guaranteed rights of towns, municipalities and districts, laid down in the Basic Law for the Federal Republic of Germany and in the constitutions of the Länder, to organise and administrate the affairs of the local community themselves is the expression of democracy in practice and is an indispensable element of a rule of order that ensures freedom. Local autonomy safeguards the power of decision at local and district level for the people and presents it as an important element of a decentralised distribution of powers.
The Federal Republic of Germany is a state governed by the rule of law in which the principle of the separation of powers applies. For this reason, the distribution of state power is not only horizontal into the legislature, the executive and the judiciary. State power is also divided vertically, i.e. into the organs of the Federation, the 16 Länder and the local authorities (municipalities, towns and districts). The principle of subsidiarity plays an important role in local autonomy; it obliges the state to assist the smaller, subordinate entities such as Länder, districts and local authorities, but it prevents the state from intervening in their tasks if they can perform them on their own.
In Germany today there are five constitutionally distinct and legally independent political levels. From top to bottom they are:
• The level of the European Union as the association of various European nation states,
• The level of the Federal Republic of Germany as a nation state with constitutional sovereignty vis-à-vis other states,
• The level of the 16 Länder as member or subordinate states without sovereignty vis-à-vis other states, including the state intermediate authorities (regional government, chief official in a region),
• The level of the districts and the towns not belonging to a district and
• The level of the towns and municipalities.
Districts, towns and municipalities are included in local autonomy. In this connection, it must be remembered that the districts (and the towns not belonging to a district) have to fulfil particular functions. They are regional authorities and an association of local authorities and, at the same time, they are also lower state administrative authorities. Local government tasks are divided between the districts on the one hand and the towns and municipalities on the other according to the principle that the supralocal services that cannot be provided by the municipalities are largely provided by the districts.
Thus, for example, the construction and maintenance of a waste disposal facility exceed the financial means of an individual municipality. The district takes on this task for all municipalities belonging to the district.
The structure of the districts is similar to that of the municipalities. Their parliament, the district council, is elected by the district’s population. The district council – just like the town council in the towns – is the main organ of the district’s autonomy. The administration of the services provided by the towns and municipalities has priority over the responsibility of the districts. The supralocal districts are, therefore, only responsible if a task exceeds the capacity of a municipality to provide a service. The responsibility of the towns and municipalities has priority.
The municipalities form a part of the state’s authority. They are termed the lowest level in the state and administrative structure, below the Federation and the Länder. Each one of these levels is represented and legitimised by parliaments. When looking at the relations between local authorities to the higher levels, a distinction must be made between the relations of towns, municipalities and districts to the Federation on the one hand and to the respective Land on the other.
In principle, the Federation is only the guarantor of the institutions of local government, but has – apart from a few exceptions – no direct relations to individual municipalities or districts. However, with its legislation the Federation influences the municipalities in many ways. These laws affect the local authorities in their capacity as links in the state structure and oblige them to implement the federal laws and have financial consequences, such as payment of social benefit.
The relations of local administrations to their respective Land are very close. This is a result of the fact that the towns, municipalities and districts are constitutional elements of the Land in question. They are directly integrated in the administrative structure of the Land. In most of the Länder there is a three tier administrative structure. Supreme Land authorities are the Land governments and the Land ministries. Intermediate Land authorities are mostly called regional governments. The lowest Land authorities are integrated in the district administrations and the towns not belonging to a district. The Land authorities are state administrative units whereas the towns and municipalities are local authorities. The districts and towns not belonging to a district are lower state authorities and local authorities at the same time.
The basis for the close interlinkage between the Länder and ”their” local authorities is in the Basic Law for the Federal Republic of Germany. According to the division of responsibilities in the Basic Law, the power to regulate local government law lies with theLänder. The organisation and responsibilities, rights and duties of the municipalities are thus regulated in the local government laws of each of the Länder.
Local autonomy in the Federal Republic of Germany is guaranteed in Article 28 of the Basic Law and in the corresponding provisions of the Land constitutions. According to this Article the constitutional order of the Länder must conform to the principles of the republican, democratic and social state governed by the rule of law.
In the Länder, districts and municipalities the people must have a parliament, according to Article 28 (1) of the Basic Law, elected by general, direct, free, equal and secret ballots. Thus, the requirements of Federal elections are also constitutionally required for the Länder and local authorities.
Article 28 (2) of the Basic Law guarantees the municipalities local autonomy by granting them the right to manage all their own affairs on their own responsibility within the limits set by the law. The right of self-government also includes responsibility for financial matters.
The guarantee of local autonomy prohibits Federal and Land legislation from removing the rights of the local authorities to manage their own affairs or from restricting this right to such an extent that the substance of the autonomy is taken away from within. Although local autonomy may be inviolable in principle as an organisational form it does not contain any guarantee of existence for an individual municipality. Municipalities can be dissolved by means of an act of parliament, tasks can be taken away from them or assigned to them if special reasons of the public well-being speak for this action. These reasons are deemed to be the case if essential territorial and functional reforms are being carried out provided that the structural principle of local autonomy per se remains unaffected.
The following sovereign rights largely belong to the responsibility of the municipality and they cannot be infringed by the Federation or the Länder within the limits of higher laws:
• Personnel sovereignty: This grants the municipalities the right to select, engage, promote and dismiss staff.
• Organisational sovereignty: This encompasses the right for the municipalities to organise the administration themselves.
• Planning sovereignty: This grants the municipalities the power to organise and shape municipality territory under their own responsibility by drawing up urban development plans (land use and building plans).
• Legislative sovereignty: This entails the right to pass municipality bylaws.
• Financial sovereignty: This entitles the municipalities to be responsible for managing their income and expenditure.
• Tax sovereignty: This grants the municipalities the right to raise taxes (provided that this right has not been revoked by a higher law).
In recent years it has been an important task of the European Union (EU) to create an appropriate legal framework to facilitate the growing together of European states to the benefit of their citizens. One important element within the European unification process is guaranteeing and securing the municipalities’ right to autonomy. In this process great care is taken to ensure that local autonomy is not weakened or even impaired in the course of European unification. The Member States of the European Union themselves granted high priority to the independence of local authorities in the European Charter of Local Government. The law in the Federal Republic of Germany and the Federal Länder is in line with the principles anchored there.
In addition to these matters of local government law the EU exerts further influence on local authorities in Germany, as can be seen, among other things, in the consequences of the Maastricht Treaty. Thus, for example, local authorities have to observe European regulations directly. Approximately half of the EU Directives concerning the single market are to be implemented by the local authorities; for instance this applies to competition policy including invitations to tender for local authority building projects and sales of plots of land, to utilities, water quality control, waste policy and the freedom of competition for various freelance workers who are traditionally of particular importance in local authority policy.
The local authorities no longer exclusively deal with higher German policy and administrative levels, they must also deal with an additional European authority. As a result of this there are new constraints on action for the municipalities, but also new opportunities. For example, new opportunities arise from active participation in the Committee of the Regions, an EU advisory body, made up of, among others, representatives from the regions and local authorities.
There have been municipalities for many centuries and they already exist as original forms of organisation before the state penetrates a country with its administration[*]. Although many municipalities can look back on an extremely long history – for example Bonn, which is 2,000 years old – local autonomy as we know it in Germany today has its roots in the Prussian Local Government Code of 1808 developed by the German statesman and reform politician Karl Freiherr vom und zum Stein (1757 – 1831). The true historical significance of Stein’s local government reform lay in the fact that it no longer regarded the towns and municipalities to be mere appendages of a totally dominant state. Much rather the local authorities were to be independent elements and thus the third force in the state and administrative structure alongside the ”Reich” and the ”Land”. The political objective of Stein’s Local Government Code was to unite the civic element with the state, to alleviate the opposition between the authorities and the subjects and to revitalise and reinforce the sense of community and the individual’s political interest by involving the citizens in public administration.
Institutionally, Stein’s Local Government Code, which was revised in 1831, made provision for a Town Council Meeting that elected a Magistrat as the head of the administration. Although the local authority policy of Stein’s Local Government Code could be designated civic local autonomy it was lacking a democratic component: only property-owning male citizens were permitted to participate.
In the course of the general developments of the 19th century, however, the citizens’ and electoral rights in the local government sector were slowly liberalised and anchored in the constitution.
The division of tasks between the state and the municipalities was not clearly regulated in the Constitution of the German Kaiserreich meaning that the administrative courts had to decide on differences of opinion. In contrast to this the Weimar Reich Constitution of 11 August 1919 vouched for the right of local autonomy within the limits of the law. Since the right to local autonomy was only regarded as an organisational principle of the state there were occasional direct interventions in local autonomy.
The Local Government Law of 1935 interrupted the tradition of local autonomy. The introduction of the so-called Führer principle and the restriction of the responsibilities of municipality administrations to advisory functions made local autonomy into an auxiliary instrument of the centralistic state.
The constitutions issued in each of the Länder after the Second World War made new provisions for the fundamental principles of local government law. Building upon this, the individual Local Government Laws were issued in which the various influences of the occupying powers could clearly be seen.
The local authorities perform a wide range of public tasks that are not determined for ever but which change and develop in line with social convictions and economic constellations and are determined by political decisions. As far as their legal quality is concerned, they can be divided into two large areas of responsibility, that is to say the municipalities’ own sphere of responsibility and the transferred sphere of responsibility.
This group of tasks deals with a municipality’s own sphere of activities that is also known as self-government tasks. Within the own area of responsibility a distinction must be made between the voluntary and the mandatory self-government tasks. It is left to the discretion of the municipality in question whether it wants to perform a voluntary self-government task.
It is entirely up to a municipality whether it wants to establish a theatre, a museum, a sports field or a municipality hall. The Land cannot intervene in these matters.
The mandatory self-government tasks include such local government matters that have to be performed by the municipalities as a result of a Federal or Land law. Within the framework of self-government the municipality is thus obliged to guarantee energy and water supply for the citizens. The manner in which the municipality fulfils this task is its own affair. The municipality can operate its own waterworks, but it can also obtain its water from another provider.
The most important self-government tasks are, for instance:
• providing the citizens with water, electricity, district heating, gas
• wastewater services and waste removal
• planning municipality territory by specifying residential, commercial and other areas (land use plans).
It is the task of town planning to control the development of land distribution and use, locational distribution, building, land development and planting and to better coordinate public and private building measures. Town planning is carried out with the following instruments:
– Land use plan and building plan
– Building approval procedure
– Local authority land policy including the land order and dispossession procedures
– Public investments.
In principle every proprietor is entitled to build on his own plot of land as he so desires (freedom to build). However, this right is limited in order to ensure an orderly development of buildings in the municipality. This ”social binding” of property can go so far as to state that areas of plots of land can be compulsorily purchased for important public building projects in individual cases.
• The construction and maintenance of local roads and green areas, parks and cemeteries
• The construction and operation of own sports and social facilities
• Cultural and educational work including the construction or maintenance of own and the promotion of private cultural and educational facilities
• The construction and operation of hospitals and old people’s homes
• Local public transport
• The construction and maintenance of schools
• Matters concerning the fire brigade
• Local authority economic promotion.
The registrar’s office performs all the important tasks in a municipality: publishing banns, performing marriage ceremonies and issuing birth and death certificates are state tasks that the Federation or the Land have transferred to the municipalities by virtue of a law. State control is extended to legal and expert supervision with the entitlement to issue instructions under certain conditions.
The following administrative areas are also part of the transferred sphere of activity:
• General security
• Nationality, registration, passport affairs
• Registrar’s office and civil status
• Commercial affairs
• Construction matters
• Health care, veterinary affairs
• Road traffic
• Registration of vehicles and vehicle taxation
• Water legislation and land cultivation
• Federal and Land parliamentary elections (implementation)
• Social affairs, youth care
• Protection and maintenance of historical monuments
• Forestry and fisheries.
In the Federal Republic of Germany responsibility for the municipalities falls exclusively to the Länder within the framework of the distribution of powers between the Federation and the Länder. The consequence of this is that each Land has its own local government law as its local government constitution and that the systems of bodies and institutions anchored in them sometimes vary considerably from Land to Land. This not only makes it more difficult to have an overview of the systems, it can also lead to misunderstandings because identical terms can sometimes refer to very different functions.
The differences in the local government constitutional systems between the Federal Länder are historical in origin and reflect the impact of the previous states or the influence of the occupying powers following 1945. The local authority reforms (in the 70s in the old Federal Länder; in the early 90s in the new Federal Länder) only had a slight influence on the local government constitutions. The main objective of the reforms was to strengthen administrative force and led to the dissolution of some municipalities.
In order to obtain an overview it makes sense to stylise the various systems of local government constitution. In this connection it should be pointed out that the most recent local government constitutional reforms in the old Federal Länder and the newly created local government laws in the five new Federal Länder in the east have led to a partial ”mix of types” meaning that a clear categorisation and labelling is not always easy.
The stylisation that has always been used in the past, however, has the tremendous advantage that the most important peculiarities of the various local government constitutions can be described.
The local government constitutions in force in the Federal Republic of Germany can be placed in the four basic types:
• Magistrat’s constitution
• Mayoral constitution
• Northern German council constitution and
• Southern German council constitution
The Magistrat’s constitution – used, for example, in the Federal Land of Hesse – is mainly characterised by the division of tasks between the local council elected by the citizens and the Magistrat, a collegial body. The local council, also called the town council meeting (Stadtverordnetenversammlung) in Hesse, is the highest body in the municipality and elects its own chairman. The local council is responsible for all local affairs unless they have been assigned to the executive by virtue of a law.
The executive is the Magistrat that, in the form of a collegial body, heads the local authority administration. The Magistrat, which is made up of professional and honorary members, is elected by the local council. It is the collegial administrative authority of the town, dependent on the council and responsible for the execution of the council’s decisions. The mayor, now directly elected by the citizens in Hesse, is the chairman of the Magistrat, but not of the local council.
This type of local government constitution – used, for example, in Rhineland-Palatine, is characterised by the fact that the mayor is both head of the municipality administration and chairman of the municipality council elected by the citizens.
The original version of mayoral constitution provided for the mayor being elected not by the people but by the town council. However, this was changed in the most recent reform in Rhineland-Palatine with the result that the mayor is now directly elected by the people.
Another peculiarity of the mayoral constitution can be seen in the fact that in municipalities with over 15,000 inhabitants there is another important institution alongside the council and the mayor: the town board (Stadtvorstand). It is made up of the mayor and the professional and honorary assistants. The purpose of the town board is, in place of the mayor, to prepare town council decisions relating to the budgetary plan, bylaws, personnel affairs, financial planning, urban development planning, renovation of the town, etc. The mayor also requires the agreement of the town board for urgent decisions.
As a result of the introduction of the town board the original mayoral constitution has been changed to something like a Magistrat’s constitution. But the mayor is elected directly.
Northern German council constitution
The Northern German council constitution in the Federal Land of Lower Saxony together with the Southern German council constitution are the most important types of council constitution in Germany. The Northern German council constitution is characterised by the fact that it allocates the local government leadership functions to two incumbents: the mayor and the town or municipal clerk. In towns not belonging to a district the incumbents are known as Lord Mayor and Chief Town Clerk respectively. The characteristic of this type of constitution is the so-called double head of the local government administration.
The mayor is the chairman of the town or municipality council and is – at least in the classic version – elected from their midst. Depending on the size of the municipality the mayor holds an honorary position and receives an expense allowance. In his capacity as chairman of the local council he must perform all the tasks that ensure a correct preparation and organisation of council meetings. He has further powers; for example he must implement council decisions for implementation of the rules of procedure, assertion of the municipality vis-à-vis the municipality or town clerk and concerning the municipality clerk’s administration. Above and beyond this the mayor is entitled to demand from the municipality or town clerk at any time information and access to the records concerning municipality affairs. In extremely urgent cases the mayor, together with another member of the council, is entitled to make a decision instead of the council. The mayor represents the municipality outside the municipality.
By way of contrast, the municipality or town clerk is the head of the administration and this is a professional position. His powers include the management of the business of the daytoday administration that are deemed to have been transferred to the municipal or town clerk on behalf of the council, the right or the duty to object to unlawful decisions of the council and its committees, to prepare and implement council and committee decisions, the management and distribution of business, the management of personnel matters, representation of the municipality outside the municipality in legal and administrative affairs as well as the performance of tasks assigned to him by virtue of the law. The council can transfer further powers to the municipal or town clerk, but can revoke them at any time within the framework of the right of revocation. The right of revocation also applies to the management of the simple business of daytoday administration.
Under the Northern German council constitution a relatively strong position is assigned to the municipality council, which is reflected in the election of the mayor and town clerk and the right to revoke tasks – in other words the right to remove privileges – vis-à-vis the town clerk.
A slightly different version of the Northern German council constitution is in force in Lower Saxony, where there is an administrative committee. This body comprises council members under the chair of the mayor and the head of the administration, who, however, has no voting rights. The administrative committee performs specific coordination tasks for the municipality. At the same time it performs managerial functions for the administration. In this capacity it is an ”extended arm” of the council in the administration. Lower Saxony and North Rhine-Westphalia have, however, decided on local government reform. From 1999 onwards the mayor in North Rhine-Westphalia will be directly elected by the people. The so-called double head (town clerk and mayor) will then no longer exist.
The new features, which are largely concerned with the areas of tasks and functions of the mayor, opportunities for the public to participate, framework conditions for elected members and the scope for action of local authorities, have led to some considerable departures from the model of Northern German council constitution as described above. In particular, this is the case with respect to the new tasks and functions of the mayor.
As mentioned above, the so-called double head of municipal director and mayor will be abolished in North Rhine-Westphalia as a result of the new local government constitution. The reason for this can be seen in the fact that the model of the double head often led to problems in agreement and less efficiency. Furthermore, this organisational form was not transparent enough for the public. However, here there is the risk of overburdening and incompetence because it is a political election.
The mayor will be active as a professional elected local authority civil servant. He is not only the supreme representative of the municipality, at the same time he is also the head of the administration. In this double function he will work closely with the council, which will continue to be the most important body in the municipality.
In North Rhine-Westphalia from 1999 onwards the mayor will be directly elected by the citizens of the municipality at every local government election for a period of five years at the same time as the municipality council election. This mayoral election is presented as an approach to the model of the Southern German council constitution, as will be seen in the following.
There are a number of special provisions for the transitional phase until the local government elections in 1999. These take account both of the acquired civil service legal status of the municipality clerks already in office as well as the local authority scope for shaping the transitional period.
The special characteristic of the Southern German council constitution – for example used in Bavaria and many eastern German Federal Länder – is the strong position of the mayor. Alongside the council he is the main municipality body. In his office he brings together all the important leadership functions. He is the chairman of the local council with a right to vote, head of the administration, representative and legal representative of the municipality.
The decision-making body is the municipality council, which is made up of the mayor and the municipality council members elected by the public. The councillors hold honorary positions and are not bound to instructions and commissions from their electors. The municipality council is responsible for all municipality affairs unless they have been assigned to the mayor by virtue of the law.
The mayor is elected directly by the people. The direct election is not only an additional means of public participation, it also considerably reinforces the mayor’s assertive force who can appear in front of the municipality council as the elected representative of the people and be entitled to realise his ideas, referring to the will of the people. In addition to the above-mentioned powers, the mayor is also responsible for matters of a specific nature that the municipality council has transferred to him for him to perform independently. The municipality council cannot revoke such transferred tasks in individual cases. If it wants to decide on the matter itself, it must revoke the task generally.
The position of the mayor underlines the local government electoral system within the area of the Southern German council constitution. The elector, who has as many votes as there are mandates to be given, can take over candidates from other electoral lists (splitting tickets), give a candidate up to three votes (accumulation) or accept an election proposal without any changes. The popular election of the mayor and the possibility to accumulate and split tickets not only give the elector a greater influence on the party political composition of the most important body in the municipality, in practice they also lead to a situation where there are far more politically independent mayors in the Länder with Southern German council constitutions than in the other Federal Länder.
The municipalities need income in order to be able to perform their tasks. The municipalities’ most important sources of income include fees and contributions, taxes, financial allocations from the Federation and the Land, income from selling building land or income from real estate and loans.
Fees are charged if a specific municipality service is used, for instance usage fees for a visit to a swimming pool or administrative fees for issuing a passport.
The municipalities procure some of their funds from contributions, such as development contributions for roads or spa contributions. The purpose of contributions is to increase the operative capability of the municipality. They are to be paid by people who will gain a direct or indirect advantage from the municipality service.
Another important source of income for the municipalities are taxes, such as trade tax, real property tax and, proportionately, income tax or road vehicle tax.
Income from fees, contributions and taxes are not enough to finance local authority tasks. For this reason the municipalities receive state allocations from the Federal Land within the framework of local authority fiscal equalisation. This fiscal equalisation is designed not only to generally improve the financial situation of the municipalities, it is also to balance out extremely large differences in the taxable capacity of the local authorities as well as to be able to bear the special burdens of central municipalities that provide services for the surrounding area.
Other income for the municipalities can arise from charges under private law, for example, such as income from rentals and leases.
Since the sources of income listed above are usually not enough to cover all expenditure, the municipalities are allowed to take out loans. However, loans may only be taken out for investments or investment promotion measures and only if no other means of financing is possible.
II Notes on a local government constitution: using the example of the Local Government Law of the Free State of Bavaria
Of the four types of local government constitutions portrayed here, the Southern German council constitution appears to be the most suited to modern times. On the one hand this is reflected in the fact that of the five new Federal Länder, three Länder, namely Saxony, Saxony-Anhalt and Thuringia, have adopted key elements of the Southern German local authority version. Another argument that emphasises the significance of the Southern German model can be seen in the fact that North Rhine-Westphalia, previously a major representative of the Northern German council constitution, has recently integrated large areas of the Southern German version – e.g. direct election of the mayor – within the framework of a fundamental reform of the local government constitution. The same applies in a slightly diluted version for Rhineland-Palatine, a representative of the mayoral constitution. For the above-mentioned reasons the Bavarian Local Government Law will be presented here.
The Federal Land of Bavaria is not only a classic representative of the Southern German council constitution. A few years ago it also revised the local government council constitution, which is now an uptodate set of regulations under local government constitutional law.
In Article 1 of the Bavarian Local Government Law (Bayerische Gemeindeordnung – GO; referred to as GO in the following) the municipalities are designated original regional authorities that are entitled to organise and administer local matters within the framework of the law. The characteristics of a regional authority are the membership of the citizens, sovereign power, legal capacity, local autonomy and local ”responsibility for everything”. As bodies under public law the municipalities are the bearers of public power. The term ”organise” used in Article 1 of the GO means the independent legislative power of the municipality that is exercised in the form of a bylaw or a municipality ordinance. The term ”administer” is used to refer to the entire shaping and executive activity that serves to perform the municipality tasks.
The characteristic of sovereign power is the superordinate-subordinate relationship vis-à-vis the citizens, which includes the entitlement for regulations to be adhered to and the possibility of using compulsory measures.
In its capacity as a legal person the municipality is capable of entering into legal transactions, capable of being a party to legal proceedings and is responsible for tortious acts in the meaning of private law.
The state territory – with just a few exceptions – is in principle assigned to the municipalities and is thus, at the same time, territory of the entity ”municipality” (Article 10 GO).
The word ”original” in Article 1 of the GO is supposed to mean, on the one hand, that the municipalities are often older than the state or other regional authorities created by it. On the other hand, is also supposed to express that the municipalities represent the foundation of the state from geographical, sociological and political points of view. This is linked to the consequence that the municipalities are due a legal system within the legal order that is to be respected by the state.
In Articles 5 and 5a the Bavarian Local Government Law initially makes a distinction between those municipalities that belong to a district and those that do not. The difference between the two types of municipality is that the territory of a municipality that belongs to a district is part of the next highest regional authority, the district. The municipality population is at the same time part of the population of the district. By contrast, the municipalities that do not belong to a district are legally equal to the districts and are independent of the existence of a district.
In addition to the tasks for all municipalities, the municipalities that do not belong to a district perform all the tasks that are the duty of districts as well as general tasks of state administration at the lowest level. The municipalities that do not belong to a district are always towns.
Among the municipalities that belong to a district, a distinction is made between the large district towns and the other municipalities that belong to a district. From a purely legal point of view the large district towns have exactly the same status vis-à-vis the district as the other municipalities that belong to a district. However, they differ from the other municipalities that belong to a district in that tasks are transferred to them, which are otherwise the duty of the Chief Administrative Officer’s office. The content and extent of these tasks is generally determined for all large district towns by a statutory ordinance issued by the Bavarian State Government. By contrast, the municipalities that belong to a district must only perform those tasks that are assigned to them by the Bavarian Local Government Law or other laws. All tasks of the lowest level of state administration that concern the district will be performed by the Chief Administrative Officer’s office in its capacity as the district administrative authority.
Article 15 of the GO distinguishes between municipality inhabitants and municipality citizens. Municipality inhabitants are all people who have their residence in the municipality. Municipality citizens is the term used for all municipality members who are entitled to vote in the municipality elections pursuant to the provisions of the Local Government Election Act (Kommunalwahlgesetz).
Within the framework of the general provisions all municipality members are entitled to use the municipality’s public institutions (Article 21 I GO). Furthermore, they are entitled to exercise participation, advisory and voting rights in citizens’ assemblies and participation rights in municipality council meetings. The municipality members are entitled to inspect the minutes of the public municipality council meetings and to exercise the right to approach the council with petitions pursuant to Article 56 III of the GO. In addition to the above-mentioned rights of the municipality members, the municipality citizens also have active and passive votes for the municipality council and the mayor. They are also entitled to take part in petitions for a referendum and citizens’ decisions pursuant to Article 18 a of the GO.
The most important rights, which include the right to vote and rights in connection with the citizens’ assembly, the petition for a referendum and the citizens’ decision, will be explained in more detail below.
Under Article 17 of the GO the municipality citizens elect the municipality council and, with the majority of the votes cast, the mayor. The details of municipality voting law are not regulated in the Bavarian Local Government Law, they are dealt with in the Municipality and District Elections Act (Gemeinde- und Landkreiswahlgesetz) and in the Municipality and District Elections Code (Gemeinde- und Landkreiswahlordnung). According to these, the election must be general, equal, direct and secret. In Bavarian local government elections the voter has as many votes as there are municipality councillors to be elected. In this connection he is thus able to split or accumulate some of his votes as outlined above. All Germans within the meaning of the Basic Law and, under the terms of the Maastricht Treaty, all citizens of an EU Member State who have reached 18 years of age on election day are entitled to vote. In order to be entitled to vote the citizen must also have been resident in the municipality for at least three months prior to the election day.
EU citizens entitled to vote will only be included in the list of electors upon application.
Anyone who is entitled to vote who is over 18 years of age is eligible to be elected to the municipality council. Only citizens who are Germans and over 21 years of age on the day of the election may be elected mayor (or deputy mayor).
The municipality citizens have the opportunity to become involved in topical questions and issues at citizens’ assemblies (Article 18 GO). The citizens’ assembly is not a municipality body, it merely serves the purpose of discussing municipality affairs and, thus, informing the citizens. The citizens’ assembly can adopt recommendations for the municipality council which this body must deal with within a period of three months.
Pursuant to Article 18 I of the GO the mayor is obliged to call a citizens’ assembly at least once a year. Upon the request of the municipality council the citizens’ assembly can also be held more frequently. The right to speak at the citizens’ assembly only applies to municipality citizens. The citizens’ assembly can decide on exceptions. Article 18 II of the GO also opens up the possibility of a citizens’ assembly being called for upon application by the citizens. After this a citizens’ assembly must be held within three months if at least 5 per cent of the municipality citizens, or at least 2.5 per cent of the municipality citizens in municipalities with over 10,000 inhabitants, apply for a citizens’ assembly in writing stating the agenda. A citizens’ application can only be made once a year.
The provisions of Article 18 a of the GO on the petition for a referendum and the citizens’ decision are relatively new. The petition for a referendum contains the right of municipality citizens to apply for a citizens’ decision concerning matters of the municipality’s own sphere of activity. A petition for a referendum cannot be made in matters that are the responsibility of the mayor by virtue of a law, issues of administrative organisation, on the legal circumstances of the municipality administration, municipality council members, the mayor or municipality employees or on matters relating to the financial statement. The petition for a referendum, which is to be submitted to the mayor in writing and with certain formalities being observed, must be signed by a certain number of municipality citizens to be effective.
Here is an example: the municipality council intends no longer to operate swimming pools in the future. A citizens’ action group is against this and organises a petition of the municipality population stating that the municipal swimming pools should continue to be operated. In the vote, 25 per cent of the municipality citizens (entitled to vote) vote for the swimming pools to be retained. This petition for a referendum is then submitted to the mayor with an application for a citizens’ decision to be carried out. Since the citizens’ decision is permissible and the minimum number of municipality citizens has agreed a citizens’ decision must be held within three months.
The duties of municipality members are initially in bearing municipality charges pursuant to Article 21 I of the GO. This duty corresponds to the above-mentioned right to use municipality institutions. The municipality citizens also have the duty, pursuant to Article 19 I of the GO, to take on and maintain municipality honorary positions, for example that of the mayor. This duty results from the membership structure of the municipality that, as a regional authority, includes the active participation of the municipality citizens in the performance of municipality tasks.
In the presentation of the constitutional foundations of local autonomy above the sovereign rights of the municipalities were outlined as including personnel, organisational, planning, legislative, finance and tax sovereignty. Legislative sovereignty is to be at the centre of the following description; it will be called sovereignty to pass bylaws. It is a central right of the municipalities insofar as it not only affects the legislative power, but its substance also often touches upon the other sovereign rights.
The municipality implements its legislative activity by issuing bylaws and ordinances; this is regulated in further detail in Articles 23 to 28 of the GO. Whereas the bylaw procedure is laid down in the Local Government Law, the ordinance procedure is defined in corresponding Land criminal and ordinance legislation.
In terms of substance the municipality bylaws pursuant to Article 24 I of the GO refer in particular to regulations
• on the use of municipality property and municipality public institutions,
• on the use of municipality supply and disposal services, such as water supply, waste water removal, waste management, street cleaning, undertakers, slaughter houses and other institutions serving public health,
• on connections to and the use of plots of land that are having new buildings constructed on them, to institutions for the supply of district heating or gas,
• on municipality services for the performance of municipality tasks.
In those fields in which the municipality issues a compulsory order for connection and use, this may only take place within the legally permitted cases. Above all, this refers to supply and disposal services for households and plots of land in the municipality territory.
In cases of infringement or inactivity, the municipalities can also regulate that penalty fines or compulsory measures can be imposed upon the municipality inhabitant concerned.
According to Article 29 of the GO the two principal bodies of Bavarian local authorities are the municipality council and the mayor, both of which are directly elected by the municipality citizens. Their areas of responsibility are regulated with binding effect in the Local Government Law. Neither of the two bodies may interfere in the areas of the other body.
The municipality council, which represents the municipality according to Article 30 I of the GO, is a collective administrative body of the municipality. It decides upon all matters where the mayor does not make a decision on his own.
The municipality council is made up of the mayor and the honorary municipality council members who are appointed for a period of six years (Article 31 I, II GO). In municipalities with more than 10,000 inhabitants professional council members can also be elected by the municipality council; they only play an advisory role in matters of their own area of responsibility (Article 40 GO).
The number of municipality council members depends on the size of the municipality and is between 8 members in municipalities with up to 1,000 inhabitants and 60 municipality council members in municipalities with between 200,000 and 500,000 inhabitants. Seventy or eighty municipality council members respectively are foreseen for the two largest cities in Bavaria: Nuremberg and Munich (Article 31 III GO).
The legally prescribed provisions on incompatibility must be observed in the composition of the municipality council. Thus, for example, in municipalities with up to 10,000 inhabitants, spouses, parents, children and siblings cannot belong to the municipality council at the same time. In no municipality may municipality civil servants or professional salaried employees be either honorary mayor or honorary municipality council member. The same applies to civil servants and salaried employees of an administrative association to which the municipality belongs and to employees from the legal supervisory authority who are directly involved with matters of legal supervision.
The provisions on incompatibility do not mean that an individual is excluded from eligibility for election with a candidate having to choose between office and his mandate after the election. In practice, the provision on incapability is taken into account by allowing the elected person to take unpaid leave or to suspend official duties for the duration of the honorary office.
According to Articles 29 and 30 II of the GO the municipality council is responsible for all matters that have not been transferred to the mayor under Article 37 of the GO or a committee under Article 32 II to IV of the GO. In some legally defined cases the municipality council is not allowed to transfer its decision-making power to a committee. This includes the issuing of certain bylaws and ordinances, matters relating to civil service and employment law, budgetary and financial affairs, matters concerning the municipality’s own and economic companies as well as measures concerning the auditing office, which are defined in further detail.
The municipality council acts as a collective local authority body within the framework of its powers and responsibilities. It can organise the inspection of the administration and the implementation of its decisions, either by a report from the mayor or by involving a committee or a reporter. However, the municipality council cannot derive the right to issue instructions from the right of inspection.
The formation of municipality committees, that can be either advisory or decision-making in nature, removes a burden from the municipality council. Consultative committees, which are supposed to enable the formation of will on certain matters under discussion in a small circle, only issue a sort of opinion on the actual matter. The power to decide remains with the municipality council. By contrast, decision-making committees, which are also known as municipality senates, make decision instead of the municipality council. Under Article 32 II of the GO the municipality council can transfer either certain areas of business or the performance of specific tasks to the decision-making committees.
Under Article 33 of the GO the composition of the committees, which is regulated in more detail in the municipality council’s rules of procedure, must take account of the relative strengths of the parties and electors’ groups represented in the council. There are various distribution procedures for this. Only people proposed by the parties or electors’ groups can become members of the committees.
In the rules of procedure, issued by the municipality council, the council regulates the course of business of the municipality council and the committees. In this connection, certain requirements pursuant to Article 45 of the GO concerning deadlines and formalities must be adhered to.
The mayor is elected directly by the municipality citizens for a period of six years. According to Article 34 I of the GO he is a municipality civil servant. The details of civil service status are regulated in the Act on Local Authority Elected Civil Servants (Gesetz über kommunale Wahlbeamte) and not in the Local Government Law. In towns not belonging to a district and in large district towns he is called Lord Mayor. In municipalities with over 5,000 inhabitants he is a temporary professional civil servant in principle. In municipalities with less than 10,000 inhabitants the municipality council can decide in a bylaw that the office of mayor is to be honorary.
In addition to the mayor, deputy mayors can be appointed. However, in contrast to the mayor, they are not elected by the municipality population, but rather they are elected by the municipality council from its midst. The deputy mayors in order represent the mayor in line with Article 39 of the GO if he is prevented from doing his duty.
The duties of the mayor include distributing business to the deputy mayors and the municipality employees within the framework of the rules of procedure (Article 39 II, Article 46 I GO), preparing and calling municipality council meetings (Article 46 II GO), exercising domestic authority and chairing the municipality council (Article 36 GO). He is also the executing body of the municipality because he implements the municipality council decisions and the decisions of the decision-making committees.
Representation of the municipality outside the municipality is the duty of the mayor according to Article 38 of the GO. He alone is able to issue legally binding statements on behalf of the municipality. The mayor, and not the municipality council, has the sole right of representation of the municipality. He can delegate this right of representation to his deputy.
Article 37 of the GO lists the business that the mayor takes care of on his own responsibility. In particular they include ongoing administrative tasks that have no fundamental significance for, or no impact on, the municipality .The municipality council may not interfere in this business. In line with Article 37 II of the GO, the municipality council can transfer other matters for independent handling by the mayor by means of the rules of procedure. Regardless of this the mayor has the power to take measures instead of the municipality council or a committee in urgent matters or in undeferrable business. He must inform the municipality council or the committee of this at the next meeting.
The administrative principles that are regulated in Article 56 of the GO refer to the lawfulness and course of business of the administration. According to this, the municipality’s administrative activity must be in harmony with the constitution and the law and must only be driven by factual aspects. The municipalities are subject to the obligation to ensure that business runs smoothly and to create the institutions required for this.
As far as the administrative tasks are concerned, a distinction is made in Articles 57 and 58 of the GO and in laws between the tasks of the own sphere of responsibility and the transferred sphere of responsibility. Please refer to I 3 since the tasks of the municipality have already been described in detail there.
Article 60 of the GO prescribes that towns with over 100,000 inhabitants divide their territory into town districts. When the territory is being divided into town districts the historical context and names as well as peculiarities of population and economic circumstances must be taken into account. The town districts are not regional authorities, they are purely administrative districts. It is left to the discretion of the municipality council to form town district administrative offices and advisory town district committees for certain administrative tasks falling in their areas.
In towns with over one million inhabitants such town district committees have to be formed. The composition of the town district committees is in line with the results of the election to the town council in the town district in question. The municipality council can also transfer final decision-making powers to the town district committees, taking into account the interests of the town as a whole. In this case the members of the town district committee are elected by the municipality citizens at the same time as the member of the municipality council for the same length of time. The details of the election of town district committee members is based on the provisions of the Local Authority Election Act (Kommunalwahlgesetz).
The whole purpose of forming town district committees and town district administrative offices is to delegate some of the administrative tasks in cities. In this way proximity to the people is being taken into account. Furthermore, another aim is to ensure that matters relating to a particular district of a town are decided on and discussed in the town district concerned.
According to Article 61 of the GO the municipalities must plan and manage their budgets in such a way that they can perform their tasks at all times. In this way the principles of thrift and economy must be taken into account. A financial regulation pursuant to Article 63 of the GO must be issued for each fiscal year.
The financial regulation contains the stipulations of the budgetary plan (Article 61 GO) with details of the total sum of income and expenditure in the fiscal year, stipulation of the total sum of scheduled loans for investments and investment promotion measures (loan authorisations), stipulation of the total sum of planned authorisations to enter into obligations that burden future fiscal years with expenditure (obligation authorisations), stipulation of tax-levy rates and stipulation of the maximum amount of cash advances.
The financial regulation, together with its annexes, is decided by the municipality council in a public meeting. It thus comes into being in the formal bylaw procedure (Article 61 GO).
The municipality budget is divided into the administrative and the property budget. The administrative budget contains all income and expenditure within the framework of the performance of tasks. Broadly speaking, the property budget contains all investments in assets.
The budget must be managed with thrift and economy.
According to Article 64 para. 3 of the GO the budgetary plan must be balanced. Deficit municipality budgetary plans are thus impossible. The budgetary plan is the basis for the municipality’s budget and is binding for budget management in line with the provision of the Local Government Law and other provisions.
In the course of a year, however, the expected tax revenue can be below the prior calculations and thus cause an imbalance in the budget. These unforeseen developments can be countered with the instruments of extra and unscheduled expenditure. Extra and unscheduled expenditure is only permissible if it is unavoidable and coverage is guaranteed. If the amount concerned is high, the municipality council must approve it. The definition of a high amount will usually be standardised in the financial regulation.
If the financial regulation has not yet been issued at the beginning of the fiscal year, the budget can be managed provisionally in line with the provisions of Article 69 of the GO.
In order to ensure a sound budgetary and financial economy in the long term, the municipalities are obliged, under Article 70 of the GO, to implement five-year financial planning. For this, the municipalities have to set up an investment programme. The financial plan must include the extent and composition of the probable expenditure and the ability to cover it. The financial plan and investment programme must be adjusted to current developments each year.
In practice it has been seen that the yearly principle in the budget is often too short for investments to be implemented and tasks carried out. If used sensibly, fiveyear financial planning is an effective means of protecting the municipalities from financial bottlenecks.
Annual accounts have to be issued for each fiscal year. They provide information on the state of the assets and obligations at the beginning and end of each fiscal year. Furthermore, a statement of account must be made (Article 102 GO). Independently of the general review of the annual accounts by the municipality council, Article 103 of the GO prescribes a local audit that is carried out either by the municipality council or by the auditing committee.
In addition there is also the regional audit that in Bavaria is carried out either by the Bavarian auditing association for the public sector (Bayerischer Prüfungsverband öffentlicher Kassen) or by state auditing offices.
The administration of municipality assets is an original task of the municipality. The municipality assets, which can be subdivided into various types of assets, comprise all movable and fixed assets as well as other rights. Under Articles 74 and 75 of the GO both the acquisition and the sale of municipality assets are only permissible within the framework of the performance of municipality tasks. Municipality assets must be administered with care and economically and proper records must be kept. Assets can usually only be sold for their full value (in the sense of a market price). The same applies to the transfer of the use of an asset. Exceptions to this are permitted in the case of renting local authority buildings to ensure living accommodation at a reasonable cost and to ensure the existence of small and lowincome commercial operations.
According to the provisions of the Bavarian Local Government Law (Articles 89 – 98 GO) municipalities may only participate in economic life in exceptional cases. The intention of this is, on the one hand, to protect private sector companies because local authority economic enterprises should not be in competition with the private sector in the free market economy. On the other hand, this type of activity and involvement in competition are associated with risks for the municipality, which local authorities should not expose themselves to. Under this condition the municipality can only set up, take over or expand an economic enterprise if the public wellbeing requires this company, if the size and type of the company is in relation to the capacity of the municipality and its probable need and if the purpose cannot be fulfilled just as well and economically by another party.
A large area of economic activity is covered by the savings banks (Sparkassen). In line with the provisions of the Savings Bank Act (Sparkassengesetz) of the Land of Bavaria, local authority administrations can set up and operate savings banks with permission from the supervisory authorities.
The savings banks
– are founded by municipalities and associations of municipalities
– are based on the liability of these municipalities (guaranty authorities)
– pass on some of their annual net profit to the municipality
– are largely administered by the representatives of the guaranty authority (municipality council) in key fundamental decisions
– are subject to the supervision of the regional government.
The savings banks are operated in the form of an institution under public law and are independent vis-à-vis the municipality. The bank transactions with the customer are carried out in private law forms. According to the Federal Administrative Court the savings bank is a financial institution of a unique kind and is therefore a special form of bank. It is supposed to offer the public the opportunity of safe, interestbearing investment of their savings and other moneys as well as satisfy local needs for loans. Furthermore, the savings banks must use suitable institutions to encourage the public’s sense for saving and promote electronic means of payment.
The so-called regional principle applies to the savings banks. This principle states that the area of business of a savings bank is restricted to the territory of the guaranty authority (= municipality or district). According to this, the head office and branches of a savings bank may only be set up within the municipality (district) territory. The point behind this regulation is to eliminate competition between the public savings banks. The regionally limited area of business must be separated from the (unlimited) area of activity which is determined by the rules of the market. Thus, for example, the savings bank can accept savings deposits from anyone. When investing the savings bank stock in securities, accounts receivables and other values it can also participate in foreign market developments. To this extent, their area of activity is based on the ”world principle”.
Even though the savings banks are part of a banking and currency system they differ from banks in terms of
– ownership (= local authority),
– a local and regional focus,
– the factual main focus of business relations to the public living in the immediate vicinity,
– the exclusion of competition in the territory of a municipality or district.
The second large branch of local authority business is the local supply industry. All larger towns and many municipalities belonging to a district operate energy, gas or water supply companies, either alone or in conjunction with other local authorities.
The third major pillar of the local authority economy is the transport sector. Larger towns in particular have their own local public transport companies. Other opportunities within the transport sector include the operation of sea or inland ports, airports, mountain railways, etc.
Educational and cultural institutions, such as schools, museums, theatres, and welfare institutions such as youth centres, kindergartens, children’s homes and sports fields, are generally not counted as economic companies.
However, this is more of a formal classification. Aspects of efficiency must always be taken into account and also play a major role. ”Economic companies” is taken to mean those institutions whose main purpose is to make a profit (cf. Article 94 GO). But one can hardly say this about theatres, for example.
Financial accounts must be drawn up for each fiscal year. They provide information on the status of the assets and the obligations at the beginning and the end of the fiscal year. In addition a statement of account must also be drawn up. Independently of the general review of the annual accounts by the municipality council, Article 103 GO prescribes a local audit that is carried out either by the municipality council or by the auditing committee. In municipalities with over 5,000 inhabitants an auditing committee is to be founded. Municipalities that do not belong to a district must set up an auditing office.
The local audit largely covers whether the budgetary plan has been adhered to, whether the individual amounts have been substantively and arithmetically justified and documented in line with the provisions in force, whether income and expenditure have been handled in line with the law and other provisions and whether the assets have been proved and valued (Article 106 GO). One important point of the audit refers to appropriateness and economy.
In addition there is a so-called regional audit (Article 105 GO). The regional audits are carried out by the Bavarian Local Authority Auditing Association (Bayerischer Kommunaler Prüfungsverband) if the municipality is a member of this association, and for other municipalities by the state auditing offices of the chief administrative officer’s office (regional auditing bodies).
State supervision is the term used to designate the state executive that supervises the local authorities’ right to local autonomy and, where appropriate, limits it on the basis of the law. State supervision is thus the correlate of the local authorities’ right to local autonomy. For state supervision the division of local authority activities into performing the tasks of the own and the transferred sphere of activity is important in that it results in the subdivision into legal supervision and expert supervision.
State supervision is regulated in further detail in Articles 108 – 120 of the Bavarian Local Government Law. According to Article 108 of the GO the supervisory authorities ought to advise, encourage and protect with understanding the municipalities in the performance of their tasks and they ought to reinforce the municipality bodies’ decision-making force and their responsibility for their own action.
State legal supervision is subject to the performance of tasks within the own sphere of activity. It is limited to supervising the performance of the municipality’s tasks and its administrative activity that are laid down in law or have been taken over under public law. Legal supervision is prohibited from checking the appropriateness of a municipality decision made at its own discretion. This is the key difference between legal and expert supervision.
According to Article 111 of the GO the legal supervisory authority is authorised to inform itself about all municipality affairs. In particular, it can view municipality institutions and facilities, examine the business and cash account management and call for reports and files.
According to Article 112 of the GO the legal supervisory authority is obliged to object to decisions and decrees of the municipality that are against the law and demand that they be repealed or amended. In the case of nonfulfilment of the tasks under public law or obligations the legal advisory authority must call upon the municipality to implement to the necessary measures. In the event that the municipality does not respond to the legal supervisory authority’s demand within the appropriate period set, the supervisory authority must authorise and implement the necessary measures immediately at the expense of the municipality. This measure, known as Ersatzvornahme (performing a task instead of the municipality), can vary greatly as far as substance is concerned.
Another remedy vis-à-vis the municipality is the appointment of a commissioner. If the orderly course of administration is seriously hindered from fulfilling legal instructions from the legal supervisory authority as a result of the inability of the municipality council to reach a decision or by a refusal from it, the legal supervisory authority can empower the mayor to act on behalf of the municipality until the unlawful state has ended.
The most serious intervention in the municipalities’ right to local autonomy is the dissolution of the municipality council and an order for new elections, either of the mayor or of the mayor and the council. This is subject to the proviso that the unlawful state cannot be resolved in any other way. Since this intervention affects the very core of the municipality, only the Bavarian State Government may order such a measure (Article 114 para. 3 GO)
The legal supervisory authorities for towns not belonging to a district are the regions and the state Chief Administrative Officer’s office for municipalities belonging to a district.
The municipalities that are affected by the above-mentioned legal supervisory measures have the right to object and to appeal to the administrative court.
The authorities responsible for expert supervision are not usually determined by the Local Government Law, but by means of special laws. If there are no such provisions the legal supervisory authorities will also be responsible for expert supervision.
Expert supervision, which refers to the performance of the tasks in the transferred sphere of activity, contains supervision of lawfulness and appropriateness. In this connection the examination of lawfulness for the transferred sphere of activity by the expert supervisory authority is of the same extent as the examination of lawfulness for the own sphere of activity by the legal supervisory authority.
* The author is head of the ”Administration Advice” division in the Education Service, Social Department and Academy of the Federation of German Civil Servants.
* In this connection only the fundamental principle of local autonomy will be addressed. The current status and the territorial size of an actual municipality can be amended also according to the Basic Law and has often been amended within the framework of local territorial and functional reforms. But that is not the issue here.
The above article was first published by Inter Nationes as part of: Local Government Constitution, ed. by Sigrid Born, translated by Janet Barton and produced by Ilona Orthen. Reproduced with kind permission. © 1997 Inter Nationes. This HTML edition © 1998 Gerhard Dannemann. The contents of this page may be downloaded and printed out in single copies for individual use only. Making multiple copies without permission is prohibited.