Article published on diena.lv
The struggle surrounding the administrative‑territorial reform — and the sharp resistance to its implementation — somewhat overshadows an important question: what the cross-border cooperation among the municipalities is like today, and more importantly, what it will be like in the future. This is not about poetic reflections on regional identity, but about the redistribution of power and money.
Many city and municipal councils still find it burdensome to cooperate on developing communal infrastructure, planning transport flows, or constructing educational institutions — even though cooperation provides undeniable benefits, while guarding their own “sovereignty” leads to unnecessary expenses.
Slightly exaggerating, one could even claim that the categorical nature of the administrative‑territorial reform is a direct — indeed almost “inevitable” — result of this reluctance. If municipalities avoid working rationally, the state is forced to impose more economically efficient solutions.
The government’s political pressure to form larger administrative units risks “gluing together” municipalities that have long viewed their neighbours primarily as competitors for resources — for state funding, EU funds, personal income tax payers, and schoolchildren. It is likely that this mindset will persist among municipal politicians and voters in many of the newly created large municipalities.
The roots of this habit are well known — the former ability of municipalities to spend, with full autonomy, mainly the “fallen from the sky” EU structural fund resources on improving their own operations or developing infrastructure projects. Quite often, the return on these investments for the general population is highly hypothetical — widely known stories tell of schools, swimming pools, and cultural facilities built in places from which a large share of residents have already left.
Inefficient spending of EU funds is a problem seen across the entire European Union, and EU financial auditors have repeatedly and consistently pointed this out. Nevertheless, the European Commission continues to roll out a relatively new instrument through which it aims — in a rather pronounced, semi‑mandatory manner — to ensure more effective investment of EU funds in local municipalities.
Therefore, the Administrative Territorial Reform will not only “redraw the map,” but will also attempt to change previous spending habits. It is closely linked to the National Development Plan for 2021–2027, which itself is part of the European Union’s new financial policy. The ability of municipalities to obtain funding from the state budget or EU funds for their development will depend much more on their capacity to cooperate.
This is clearly signaled by the term “functional territories,” introduced into the European Commission’s criteria for allocating financial resources — a concept that has been present in EU documents for several years. Latvia has not yet developed a unified definition for it, but it is easy to understand that it may refer to municipalities connected by coordinated efforts to improve the business environment, as well as by labor flows, transport systems, public infrastructure, and other links. A municipality’s territorial development plan — which must outline comprehensive cooperation with neighboring municipalities, the partners within its functional territory — is becoming an almost mandatory prerequisite for receiving EU funding.
At present, the consequences of municipalities failing to cooperate are most clearly visible in the relationship between the capital city and the surrounding Pierīga municipalities. The lack of coordination in transport and infrastructure planning has been described many times.
Riga’s mayor, Oļegs Burovs, attempted to move in step with the European Commission by hastily and ambitiously organizing — for the first time in ten years — a meeting with the leaders of the Pierīga municipalities. It was likely intended to demonstrate the new mayor’s principled difference from Nils Ušakovs, who had ignored the neighboring municipalities.
The capital city, by cooperating with the Pierīga municipalities in its mobility projects, will henceforth qualify more successfully for EU funds. Moreover, in this context, the “functional territory” is, in very practical terms, the entire Riga planning region — stretching from Kandava all the way to Staicele.
Other seemingly successful cities of national significance must also take into account the need to cooperate within the boundaries of a unified “functional territory,” even if, after the Administrative Territorial Reform, “nothing will change,” since their status and borders are expected to remain intact. This is precisely why all the development planning documents currently being hastily drafted — which, in a formulaic manner, defend “sovereignty” and ignore neighboring municipalities — are hopelessly outdated already.
A month ago, even the OECD (the Organisation for Economic Co‑operation and Development) published its report with an assessment and recommendations regarding the “functional territories” of EU member states. Its experts highlight the need to develop cross‑border cooperation not only around larger cities, but also in municipalities located further away from urban areas.
The concept of “functional territories” must become an important element in shaping regional development policy. It is easy to foresee that once the parliamentary discussions on the Administrative Territorial Reform conclude, the politicians and experts will launch a new wave of debate — both on second‑level municipalities and on the substance of the term “functional territory.”
Pressure on municipalities to cooperate will come not only from “above” — the government and Brussels — but also from “below.” A new force is entering municipal politics for good: neighborhood associations. Those forming and operating along Riga’s borders are most clearly aware of what can and should be achieved through mutually beneficial cooperation with neighboring municipalities.
Just like the entire Administrative Territorial Reform, the concept of a “functional territory” is an effective instrument for redistributing financial flows. No current municipality or its leader can afford to stand aside at a moment when the money and power of the near future are being allocated.