Portimão Council is taking the first steps towards a successful government loan of up to €150 million.
Money from the Municipal Aid Fund would serve to pay off bank borrowings and to settle overdue accounts with over 200 suppliers, 27 of whom have already had to go to the expense of court action to try and get money from the financially incompetent council.
The list of creditors includes the now defunct municipal company Portimão Urbis, the Frota Azul bus company which operates the urban transport system in the county, and curiously Parkalgar which owns the fiscally challenged Autódromo Internacional do Algarve.
Why Parkalgar should be a creditor to the council remains to be seen.
The Court of Portimão approved a controversial Special Revitalisation Process for Parkalgar which left hundreds of small suppliers, many of them local, out of pocket.
An explanation as to how this private business is owed money by Portimão’s ratepayers will be closely watched.
€91.9 million is needed to pay in full the eight banks which have allowed the council to run up huge borrowings despite its long running inability to run its financial affairs in any sort of sensible manner.
The publication of the list of creditors is the first step in Portimão’s application for government official aid.
If any aid is forthcoming it will follow a period during which the municipality must negotiate with its suppliers to try to reduce the amounts payable.
If all goes as planned, financial support from the Government, or more correctly, the Portuguese taxpayer, should be available this summer.
This loan will bring relief to the Isilda Gomes administration which has struggled since September 2013 to make sense of the accounts and bring order where there was chaos created by the reign of former mayor Manuel da Luz who brought new meaning to the word 'profligate.'
In a case of poor timning, Gomes has just handed over €440,000 to the local fire service.
The money was collected amid protests from ratepayers, from a special civil defence tax which caused protests and confusion as to what happens to any money raised in excess of the €440,000 requested, will the council take non-payers to court and the statutory role of the council in the funding of the local fire service.
