The administrative-territorial reform (ATR), established in the midst of the COVID hysteria in 2020, was extreme in every respect. It is the last one to date, the most radical, and thus made the only entity in the Republic of Latvia – a region. We have 36 of them.
Adding to them another 7 "state cities" (former republican subordination) that are not part of regions, and 3 that are, we get 43 administrative territories. However, what does this translate to in monetary terms?
Our local governments are living somewhat beyond their means – we have suspected this for a long time, but we only saw it firsthand at the meeting of the Saeima subcommittee on the assessment of administrative-territorial reform led by Valdis Maslovskis (Union of Greens and Farmers).
According to the Ministry of Finance, the undisputed leader in debt, relative to its own budget, is the state city of Rezekne – last year it set an absolute record, reaching 23%, and for 2026 it promises 21%, which also shows how the new-old government led by Alexander Bartashevich (Together for Latvia) views the principles of economic activity.
On the other hand, the Rezekne region, which is in immediate proximity to the city of the same name and has similar characteristics in everything, ranks 4th from the bottom in the rating of local governments by the level of indebtedness. There, it is only about 6-7%. Right next to the 3rd in financial stability – Ventspils. The best situation with loans is only in the Olaine and Salaspils regions.
By the way, the 4th place in the country for indebtedness is held, following Rezekne, by the Aluksne and Jekabpils regions – the Ogre region, which also includes the "state city" of Ogre. The mayor of the latter, Egils Helmanis (National Alliance), has a reputation as a tough businessman, not averse to embellishments, which has made this picturesque town a pilgrimage site for residents of Riga.
As we can see, the love for solving problems through borrowing is embraced by leaders of all political orientations. Both those conditionally "pro-Russian," like A. Bartashevich, and ardent allies of Ukraine, like E. Helmanis.
For comparison, the capital of Latvia, which has changed 6 mayors in 6 years, has always borrowed quite moderately, from 10% of the budget under Martinš Staķis (2023) to 9% under Viesturs Kleinbergs (plan for 2026).
