Direct grant to FEMP 2026: what it finances and what it means for municipalities

Key data

FEMP —which brings together more than 95% of Spanish local governments— receives in 2026 a direct State subsidy to cover its ordinary operating expenses. This is established by Royal Decree 685/2026, of August 26, published in the BOE on August 27, 2026 and entering into force that same day.

The direct award —without competitive bidding— is justified by the concurrence of reasons of public and social interest which, according to article 22.2.c) of the Law 38/2003, General Law on Subsidies, prevent resorting to an open call. The subsidy was already provided for in the Strategic Plan for Subsidies 2025-2027 of the Ministry of Territorial Policy and Democratic Memory.

What does this regulation establish?

The Royal Decree regulates all aspects of the grant: the legal basis, eligible expenses, the channeling instrument and FEMP's obligations as beneficiary.

Eligible expenses

The subsidy covers ordinary operating expenses linked to FEMP's purpose. The concepts expressly contemplated are:

• Rentals (premises, equipment or other assets necessary for the activity)
• Personnel expenses
• External professional services
• Communications
• Other ordinary operating expenses linked to the purpose

Channeling instrument

The subsidy will be implemented through an agreement signed between the Ministry of Territorial Policy and Democratic Memory and FEMP. Processing is the responsibility of the General Directorate of Regional and Local Cooperation.

FEMP's obligations

• Accredit compliance with the requirements of article 13 of the LGS (absence of debts with the Administration, being current with tax and Social Security obligations, etc.)
• Comply with public procurement regulations in acquisitions made with the subsidy
• Accept publication of the subsidy in the National Database of Subsidies (BDNS)

Economic and operational impact

Although the Royal Decree does not specify the exact amount of the subsidy —a figure that will be set in the agreement— the scope of the measure is significant for several reasons:

• FEMP represents more than 95% of Spanish local governments, making this financing a structural pillar of municipal associationism.
• The expenses covered are those of ordinary operation: personnel, rentals, professional services and communications. This ensures the federation's operational continuity throughout 2026.
• The subsidy is integrated into the Strategic Plan for Subsidies 2025-2027, indicating that it is part of a multi-year policy and not a one-off measure.
• By channeling through an agreement, FEMP will have to account for the application of funds, with the reporting and control obligations that this entails.
• Publication in the BDNS guarantees transparency and public traceability of the aid.

Who does it affect?

• FEMP (direct beneficiary): Receives the subsidy and assumes all obligations for reporting, public procurement and accreditation of requirements under art. 13 LGS.
• Represented municipalities and provinces: More than 95% of Spanish local governments benefit indirectly, as FEMP provides services, training, representation and defense of interests to its members.
• Ministry of Territorial Policy and Democratic Memory: Acts as the grantor and will sign the agreement through the General Directorate of Regional and Local Cooperation.
• FEMP suppliers and contractors: Contracts financed with this subsidy must comply with public procurement regulations.
• Citizens and local entities: They benefit indirectly from maintaining the operational capacity of the federation that represents their municipalities.

Practical example

Imagine a medium-sized municipality —say, a municipality of 25,000 inhabitants— is a member of FEMP. Thanks to this subsidy, FEMP can maintain its team of legal advisors, its training platform for municipal technicians and its institutional communication services throughout 2026, without interruptions due to lack of operating financing.

If the municipality needs advice on new procurement regulations or access to training resources for its officials, FEMP will be able to continue providing those services normally. Without this subsidy, the federation would have to reduce activity or seek alternative financing, which would directly impact the quality of service to member municipalities.

On the other hand, if FEMP contracts external services with this subsidy —for example, a communications consulting firm or an IT maintenance service— that contract must be processed in accordance with public procurement regulations, with the guarantees of transparency and competition that this entails.

What should entities do now?

1. If you are FEMP or manage its administration: Prepare the documentation accrediting article 13 of the LGS (certificates of being current with Tax and Social Security, absence of debts with the Administration) to be able to sign the agreement without delay.
2. Review internal procurement procedures: All expenses financed with this subsidy must comply with public procurement regulations. Make sure FEMP's internal procedures are up to date.
3. Prepare the reporting system: The subsidy will be published in the National Database of Subsidies. Establish a system for monitoring and reporting expenses from the outset.
4. If you are a member municipality or province: No immediate action is required, but it is advisable to be aware of the agreement that will be signed, as it may include conditions that affect the services you receive from FEMP.
5. If you are a supplier or contractor of FEMP: Anticipate that contracts financed with this subsidy will follow public procurement procedures, with the timelines and requirements that this entails.

Official source

Consult complete regulation in official source

Notice: This article is for informational purposes only and does not constitute legal advice. For specific decisions, consult a qualified professional. Source: https://www.boe.es/diario_boe/txt.php?id=BOE-A-2026-18206