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Deputy Mayor Says Tehran Municipality $12 Billion In Debt

Tehran City Council in session, undated.

The city of Tehran’s debt is much higher than previously stated, according to the deputy mayor, who blames the previous mayor for the city’s financial woes.

The Tehran municipality owes 520 trillion rials (roughly $12 billion in today’s exchange rate), Deputy Mayor Hojjat Mirzaei told the pro-reformist daily Sharq, saying former Mayor Mohammad Bagher Qalibaf’s “highly expensive management style” and “favoritism in assigning projects” dug the city into its debt hole.

The staggering figure dwarfs an earlier estimate by current mayor Mohammad Ali Najafi, which placed the city’s debt burden at 300 trillion rials (roughly $7 billion). Just six months into his term as mayor, Najafi has repeatedly accused his predecessor of corruption and misappropriation of funds.

Mirzaei said the payments owed to city contractors alone reach 90 trillion rials (roughly $2 billion), and Tehran City Councilor Mahmoud Mirlouhi said interest payments on the total debt are $1.7 billion annually.

Qalibaf, an Islamic Revolutionary Guards Corps commander and former chief of the Islamic Republic’s police force, served as the mayor of Tehran from September 4, 2005 to August 22, 2017.

More than $5 billion of city funds went missing during Qalibaf’s tenure City Councilor Majid Farahani disclosed January 15.

“Some say this money was used to pay on the city’s overdue debts, but where were the payments registered? Aren’t there any books or accounting?” Farahani demanded.

Qalibaf ran for president against incumbent Hassan Rouhani in 2017, but dropped out of the race at the final stage to back another conservative challenger, the mid-ranking cleric Ebrahim Raeisi.

In a report delivered to the city council January 14, Najafi accused his predecessor and his staff of “spending municipal funds in last May’s presidential election…suddenly employing 13,000 new personnel,” arbitrarily giving away 674 real estate holdings and “cheating” in the management of the Municipal Staff Deposit Fund.

Qalibaf has not responded to these allegations.

Nevertheless, one of his hardline allies, judiciary’s spokesman and mid-ranking cleric Gholamhossein Mohseni Ejeie, has dismissed the allegations, maintaining, “All newly appointed officials love to criticize their predecessors, but whenever asked for documented evidence, they have nothing to present.”