Both the Constitution (Article 157) and the Organic Financing Law of the Autonomous Communities (LOFCA, Article 14) include debt financing as one of the financial resources, both short-term and long-term.
The LOFCA establishes that short-term credit operations must be earmarked for covering transitory cash needs.
As regards long-term credit operations (over one year), the Organic Financing Law of the Autonomous Communities establishes two requisites:
- The resources obtained must be earmarked exclusively for investment expenses.
- The total amount of the annual amortisation payments for capital and interest must not exceed 25% of the current income of the Autonomous Community.
In addition to these requisites, if the Autonomous Communities would like to define credit operations abroad or issue public debt, they must first obtain authorisation from the State.
These authorisations are arranged through Resolutions of the Council of Ministers.
Moreover, and to comply with the functions attributed by budget stability legislation to the Fiscal and Financial Policy Board of the Autonomous Communities, in its plenary session of 6 March 2003 this body adopted the Resolutions regarding debt financing of the Autonomous Communities (PDF approx. 127.33 KB) after the entry into force of the legislation on budget stability as from 1 January 2003.
The debt financing data of the Autonomous Communities are offered by the Bank of Spain in the tables of the statistical bulletin.