The Spanish government has amended regulations governing state aid allocated to municipalities impacted by the severe flooding, known as the DANA, that struck the Valencia region last year. The change allows local councils to designate up to 3.5% of their received subsidies for personnel costs directly related to managing, monitoring and justifying projects funded by the Ministry of Territorial Policy.
The move comes in response to mounting concerns from Valencian municipalities struggling to manage the sheer volume of reconstruction projects following the disaster. Many local administrations alerted authorities to a bottleneck caused by insufficient human resources and capacity to process the necessary paperwork within a limited timeframe, according to government officials.
The initial aid package, approved in November 2024, totaled €1.745 billion, distributed to 78 municipalities and the Provincial Council of Valencia, to address damage to infrastructure and services. An additional commitment of approximately €500 million was made for repairs to municipal water and sanitation networks. The government’s concern was that unhurried execution of these funds could jeopardize the intended impact.
While municipalities were previously permitted to utilize technical assistance services or the state-owned company Tragsa, the simultaneous influx of applications overwhelmed existing systems, hindering actual project implementation. The investment was initially projected to facilitate the repair or reconstruction of approximately 100 administrative centers, 45 nurseries, 58 libraries, 55 sports facilities, 40 day centers, and 16 municipal markets.
The amended regulations also broaden the scope for utilizing budgetary surpluses to finance sustainable investments for the 2025 fiscal year. This allows affected municipalities to allocate their surplus funds towards recovery efforts, bolstering their financial autonomy during the reconstruction process. This measure was announced alongside the personnel funding adjustment, according to sources within the Ministry of Territorial Policy.
The first meeting of the joint commission for DANA reconstruction, comprised of representatives from the central government, the Generalitat Valenciana (regional government), and the affected municipalities, took place on Wednesday, February 19th, 478 days after the initial flooding. During the meeting, the president of the Provincial Council of Valencia, Vicent Mompó, requested that the government recognize the 103 municipalities affected by the DANA and include them in the commission’s proceedings.
In the municipality of Paiporta, which received €201.5 million in aid, the new regulations will allow for the allocation of approximately €7 million to hire technicians to manage the funds and expedite the submission of project documentation. Similar benefits are expected across other affected municipalities, enabling them to accelerate the reconstruction process.
