Question 17655 — municipalities

Summary

Mr. Julien Rancoule draws the attention of the Minister of Regional Planning and Decentralization to the consequences of freezing the overall operating allocation (DGF) provided for in Law No. 2026-103 of February 19, 2026. Indeed, if the national envelope of the DGF is maintained at 27.4 billion euros, this overall figure conceals a very different reality experienced by hundreds of municipalities. According to figures published by the general directorate of local authorities (DGCL) on March 31, 2026, almost half of French municipalities will see their DGF decrease or stagnate in 2026, compared to around a third in 2025. The Association of Mayors of France (AMF) thus warned, as soon as the finance bill was adopted, that the non-indexation of the DGF on inflation would cause a real drop in this allocation in more than half of the municipalities. This phenomenon results from lump sum grant capping mechanism: in order to finance the increase in equalization grants, the State does not mobilize any additional credit. It operates a simple internal redeployment, taking the flat-rate grant from municipalities whose tax potential exceeds a determined threshold, within the limit of 1% of their actual operating revenue. In accordance with the decision of the Local Finance Committee of February 24, 2026, 80% of this effort is supported by the municipalities via their fixed allocation and only 20% by the intermunicipalities. However, this mechanism, presented as a tool of “solidarity” between communities, produces unequal and unfair consequences. Indeed, certain rural municipalities, which do not benefit sufficiently from rural solidarity grants to compensate for the capping suffered, find themselves with a net decrease in DGF, without understand the reasons and rightly denounce a drop in their municipal budget. The Association of Small Towns in France (APVF) has also warned of the declines described as “massive” affecting many small towns. For all these reasons, he wishes to know whether the Government plans to protect fragile rural municipalities from the capping mechanism when the net loss of DGF is not compensated by an equivalent gain in equalization grants and if it is considered to index the DGF again to inflation in order to preserve the real purchasing power of small rural communities.

Machine translation from French. The official text remains authoritative.

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