MIGHT FINANCIAL SOURCES BE A PROBLEM IN THE FINANCING OF PUBLIC INVESTMENT? THE THEORETICAL AND EMPIRICAL STUDY

Sa？etak Municipal investments and related expenditures are an important field of activity at the subnational government tier. There are many ways of financing public investment tasks using different financial structures. However, the key role involves financial risk and other factors which determine access to financial sources (inter alia types of investment, debt limit, purpose of financing, collateral, risk, efficiency). The purpose of this article is to point out the main obstacles and challenges in the financing of municipal investment. In the research process revenues, transfers, and debt instruments have been considered. The author has also paid attention to a hybrid form of financing which integrates different kinds of instruments. As a result, the paper presents the crucial problems in investment financing which influence the investment dynamic and financial decisions made by self-government entities. The general findings are regarding: debt limits and debt policy, a revenue system which is not sound, poor experience in using structural and hybrid financing, problems with cash flow and the maturity of financial instruments, financial standing and public procurement law