In the Republic of Bulgaria, the municipality is the main administrative territorial unit, of local self-government. The Municipal Council is the main authority. Representatives are elected from their respective constituencies for a period of four years.
At the end of 2002, the first regulatory steps were taken to normalise the financial decentralisation of public services, to be carried out by the municipalities including cultural activities. The main aim was to increase local income and a maximum level of local autonomy as well as to define the character and content of municipal services.
Upon Decree of the Council of Ministers (No.°16/2003), all public services were divided into two groups:
- Activities delegated from the state in the fields of education, healthcare, social affairs and partially in the field of culture. Minimal standards have been adopted regarding the number of staff, amount of salaries, insurances and maintenance of buildings. The state is responsible for their financing through assigned taxes and for providing supplementary subsidies in cases when municipal funds are not sufficient to meet these standards; and
- Local activities including public utilities, sanitation, kindergartens and most activities in the field of culture. Financing is generated from local taxes and charges, property management, fines, etc. Those municipalities with a low capacity to generate their own income receive compensation subsidies. Investments are financed through grants which are within the realm of government priorities and objectives.
2003 was the first year that this division of labour was realised and this was seen as a serious step forward to strengthen local self-government and to overcome problems of the individual municipalities.
In 2016, the Decentralisation Strategy 2016-2025 by the Ministry of Regional Development and Public Works was adopted. It provides measures to develop decentralisation at national, regional and local level. The strategy also focuses on the cultural sector. The state cultural institutes are financed from the budget of the Ministry of Culture in whole or in part, with funds from the municipal budgets on the basis of concluding contracts with the department or with the participation of legal entities or people.