Mayor's budget proposal for 2026: result 2,1 million in deficit, the program of stable economy will continue

30.10.2025 News Mayor Town government Budget Program for a stable economy

A winding riverbed, built-up light sand banks. A railway in the background. A light blue sky with white cotton candy clouds. — The bed of the Vantaanjoki River has been moved to the center of the future Jokikylä residential area. Photo: Jenniina Nummela

The Mayor of Riihimäki's 2026 budget proposal emphasizes basic services and investing in the future. The city will invest 17 million euros next year. The largest investments are the construction of public areas in the Jokikylä residential area and the renovation of the old city hall. In addition, the city will develop its basic services while adapting its operations to the decreasing number of children. Municipal and property taxes will remain unchanged in the Mayor's proposal.

The city needs savings and vitality

The 2026 budget planning of the city of Riihimäki has been guided by the guidelines of the stable economy program. According to the program approved by the City Council in the spring of 2024, the city aims for savings of 4,2 million euros in the planning period 2025–2027.

The 2026 budget framework included a savings target of one million euros. In addition, the city committed to the stable economy program to phase and prioritize investments in order to control the amount of debt. According to the program, 2,2 million euros of the savings in operating expenses will be allocated to 2025, 1,0 million euros to 2026, and 1,0 million euros to 2027.

"The city needs to balance its finances further, as the planning years are heading towards deficits despite the current stable economy program. The program must be continued and costs and debt must be contained. In addition, we must be able to make structural changes. The service network plays a significant role in this. At the same time, the city must look to the future and ensure the vitality of the city. The power plant, Jokikylä and the new campus being built in the station area will bring a boost to the city," says Mayor Jouni Eho.

The mayor's budget proposal is a deficit of 3,6 million euros for the parent city (the city of Riihimäki without the water supply company). When the water supply company is added, the result is a deficit of 2,1 million euros.

The city employs approximately 1,100 people.

Savings from all industries

The city's largest operating expenditure savings in euros are, among other things, savings in the education and welfare sector due to the decrease in the number of children. In addition, some of the city's vacancies will remain unfilled in 2026. Savings are also being sought through, among other things, competitive tendering of the city's ICT services.

"The operating expenditure savings required by the stable economic program will arise from several streams of different sizes. For example, the study of service production methods carried out in the technical sector will provide good information for future structural changes," says Eho.

A positive aspect of the budget preparation was that the largest of the city's sectors, education and welfare, remained within the given budget framework. The city's external operating expenses will increase by only 0,6 percent compared to the 2025 budget.

17 million euros for investments

In line with its strategy, Riihimäki aims to build an irresistible quarter-city, a home for future creators and a community of sustainable growth. To promote these goals, the parent city's net investments will total EUR 17,0 million in 2026. The share of municipal technology investments is approximately EUR 7,8 million and that of space investments approximately EUR 6,3 million.

The most significant investments for next year are the continuation of the construction of Jokikylä's public areas, EUR 3,0 million, the renovation of the old city hall, EUR 3,0 million, and the planning and start of construction of teaching facilities organized by activity area, EUR 1,3 million. EUR 1,6 million has been reserved for the basic improvement of streets and parks, and approximately EUR 1,6 million has been reserved for the basic improvement of the city's premises.

"The investments emphasize the importance of the city's basic services. Basic services are the cornerstone of the city's operations, helping to build an irresistible everyday life for current and future city residents," says Eho.

Municipal tax 7,9 percent

The mayor proposes a municipal tax rate of 7,9 percent for 2026. The municipal tax rate would then be the same as this year. The property tax rates will also remain unchanged in the proposal. The general property tax rate is 1,45 percent.

The city's tax revenue is estimated to be 76,8 million euros next year and government transfers are estimated to be 10,7 million euros. Tax revenue will increase compared to the 2025 forecast, but government transfers will decrease slightly.

The operating income of the city parent company in the Mayor's 2026 budget proposal is EUR 38,2 million (EUR 42,1 million in 2024). Operating expenses are EUR 121,4 million (EUR 122,2 in 2024). Operating margin is EUR 83,2 million (79,4). Operating margin will decrease by approximately EUR 3,8 million compared to 2025.

The parent city's annual profit is 4,3 million euros and the financial year has a deficit of 3,6 million euros. The water utility company's result is a surplus of 1,6 million euros. The city's total result is a deficit of 2,07 million euros. The city's loan amount at the end of the 2026 budget year is 109,8 million euros (78,8 in 2024).

The sustainability of the economy must be taken care of

The 2026 budget and the planning years 2026–2028 are in deficit, so the city has an obligation to ensure that the economy is adjusted to a sustainable level. The most significant factors to consider are related to the general economic situation, employment and interest rate market developments, as well as changes in the general world situation.

The transfer of employment and economic services from the state to municipalities and the social welfare reform, which will affect municipal financing until 2027, will have the greatest impact on the revenue and expenditure base of municipalities. The wage settlement of spring 2025 will also have a significant impact on municipal expenditure in 2026.

The city's cumulative balance sheet surplus provides a reasonable starting point for the coming years. Due to decreasing government transfers, sluggish tax revenues, and planned investments, the city must pay attention to economic sustainability in accordance with the stable economic program approved in 2024.

The City Board will discuss the budget proposal on Monday, November 3, and the City Council will decide on the budget on Monday, November 10, 2025. The council meeting can be followed on site at Uramo school or on the city's YouTube channel.