`Municipalities` budgets are expected to face deficit amounting to BGN 300 million by the end of 2001`, Minister of Regional Development and Public Works Kostadin Paskalev said. The treasury is empty because the former government has irregularly extended loans bearing no interest to agencies and departments. `These statements are all speculations and rumors`, Muravey Radev, Former Minister of Finance said. And added that it is not possible that the deficit be so huge because he had left budget surplus of BGN 129,5 million. At their latest general meeting mayors confirmed that the municipalities` financial situation has really been strained. The municipalities` outstanding accounts to contractors amount to some BGN 150 million and this resulted in lack of money for healthcare, education and social activities. Paskalev, who is also the Chairman of the Municipalities Association, will meet with newly elected Minister of Finance Milen Velchev on August 14 to propose that money from Ministry of Healthcare budget be transferred to support municipality hospitals.