Tartu City Council is set to take up the budget for its second reading this week. The planned budget is about 5 percent larger than last year's, with the city government submitting 44 proposed changes and opposition parties putting forward another 16.

Ahead of the second reading, city leaders want to fine-tune both revenue and spending. Deputy Mayor Martin Bek (Reform) said higher-than-expected wage growth late last year will allow the city to add €600,000 in operating revenue, while investment revenues will rise by €1.4 million euros due to grants.  

On the spending side, the coalition plans to raise adult and child caregiver benefits, in keeping with Isamaa and Reform's coalition agreement.

"The price tag for that is 114,000 euros," Bek added.

The city also wants to expand plans for the Emajõgi riverfront promenade, and work will continue on Paju tänav, part of Tartu's core bike lane network.

At the same time, funding for the reconstruction of Lai tänav and Turu tänav, both major arteries that were to include bike lanes, has been dropped from the city budget altogether.

Tartu's Sõpruse Bridge, connecting its Karlova and Annelinn districts across the Emajõgi River and Anne Canal, remains one of the city's biggest projects. An additional €900,000 is earmarked for its ongoing reconstruction.

Looking ahead to this year, Bek confirmed the largest investments are tied to major construction and renovation projects. Siuru's construction could reach up to €10 million, while the overhaul of Sõpruse Bridge is estimated at nearly €6 million.

Education infrastructure is also a priority, with Miina Härma High School set for partial major renovations costing €4.1 million.

Plans to renovate Veeriku School, promised during the city's coalition talks last fall, have advanced to the stage where the city hopes to announce a design procurement this spring.

Altogether, Tartu's 2026 city budget allocates €51.8 million for investments, with a projected deficit of €13.25 million.

Opposition parties say the figures point to deeper problems. City councilmember Artjom Suvorov (Center), a member of the council's Finance Committee, said only a handful of opposition proposals were partially accepted on the city budget bill, and called the budget chaos.

He argued that Tartu has become overly reliant on borrowing. When he previously worked in the city government, Suvorov said, the debt stood at about €30 million; now it's close to €200 million.

"That is a very, very big difference," he stressed. This year alone, he added, the city plans to borrow another €30 million, with about €20 million going to debt servicing. "We've borrowed ourselves to the breaking point."

Deputy mayor: Development impossible without borrowing

Finance Committee deputy chair and city councilmember Daniel Kõiv (Eesti 200) echoed the concern, saying the city's debt has reached its max and warning that Tartu's budget remains on the verge of bankruptcy.

With the population shrinking, he argued, Tartu's ability to invest is increasingly limited. He also criticized what he called pre-election populism that fails to deliver real change afterward.

"After the elections, no real change actually happened," Kõiv said.

Bek dismissed the criticism, saying the city is operating within realistic limits. He acknowledged that the income tax reform has reduced revenues from working-age residents but argued that borrowing is unavoidable.

"If we look at what options a local government has to develop a city, then without borrowing, it simply is not conceivable," he said.

Tartu City Council is scheduled to take up the budget for its second reading on Thursday.

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