Paphos municipality under financial strain after freezing of €8 million

Bishopric’s decision to freeze €8 million of the Paphos municipality’s funds has caused financial constraints to the local authority which makes multi-million payments, Mayor Phedonas Phedonos said on Tuesday.

Measures including taxing Paphos residents are being considered in case the church governance decides to claim the amount, the mayor added.

He was commenting after Bishop Tychikos recently decided to settle an over 40-years-old dispute between the church and the municipality.

A court had ruled that the Paphos local authority owes €8 million as compensation to the bishopric because a section of the church-owned municipal garden grounds lost significant value when it was re-zoned in 1981.

But an appeal by the municipality is pending at the Supreme Court which is why the mayor was taken by surprise when the incoming bishop froze the amount from the municipal funds.

Speaking to CAN on Tuesday, Phedonos said that payments of millions of euros are being made from the Municipality’s funds.

Recently, the munnicpality issue checks worth of €2.5 million while in the coming days, they expect to pay another €3 million, he said.

He noted that currently they are managing to handle these payments, but he expressed concerns over the unilateral action of the bishopric, which affects the interests of the citizens of Paphos, the majority of whom are both Christians and members of the Church.

“The decision of the Metropolis to block €8 million of the Municipality’s funds caused financial constraints,” he said.

Phedonos also clarified that reports by the Cyprus News Agency, attributing a statement to him as Mayor of Paphos claiming that contractors in Paphos were left unpaid, was completely baseless and incorrect.

His intention was to show that substantial payments of millions of euros were being made from the Municipality’s funds, he said.

The mayor urged the bishopric to inform the Municipality of Paphos promptly if it seeks to claim the money that the court awarded after waiting for two years due to ongoing appeals in the Supreme Court. He stated that the Municipality would consider options such as selling assets, imposing extraordinary taxes on the citizens of Paphos, or resorting to loans to satisfy the bishopric’s request without affecting the smooth functioning of the Municipality.

He noted that a very large part of this money, which was blocked in banks, comes from the EU, or is money belonging to special funds and “a serious issue arises not only towards the special funds that are legislated, but also towards the EU, but we are also accountable for the smooth development of the projects”.

The bishopric, Phedonos said, ought to have informed in time to ensure proper planning.