diff --git a/rhodecode/config/environment.py b/rhodecode/config/environment.py
--- a/rhodecode/config/environment.py
+++ b/rhodecode/config/environment.py
@@ -145,10 +145,6 @@ def load_environment(global_conf, app_co
                          protocol=utils.get_vcs_server_protocol(config),
                          log_level=config['vcs.server.log_level'])
 
-    # MULTIPLE DB configs
-    # Setup the SQLAlchemy database engine
-    utils.initialize_database(config)
-
     set_available_permissions(config)
     db_cfg = make_db_config(clear_session=True)
 
diff --git a/rhodecode/config/middleware.py b/rhodecode/config/middleware.py
--- a/rhodecode/config/middleware.py
+++ b/rhodecode/config/middleware.py
@@ -36,7 +36,7 @@ from routes.middleware import RoutesMidd
 import routes.util
 
 import rhodecode
-from rhodecode.config import patches
+from rhodecode.config import patches, utils
 from rhodecode.config.environment import load_environment
 from rhodecode.lib.middleware import csrf
 from rhodecode.lib.middleware.appenlight import wrap_in_appenlight_if_enabled
@@ -157,6 +157,11 @@ def make_pyramid_app(global_config, **se
     # behavior in the old application.
     settings_pylons = settings.copy()
 
+    # TODO: Remove this by refactoring the init DB function.
+    # Put debug flag into settings for DB setup.
+    settings['debug'] = global_config.get('debug', False)
+    utils.initialize_database(settings)
+
     sanitize_settings_and_apply_defaults(settings)
     config = Configurator(settings=settings)
     add_pylons_compat_data(config.registry, global_config, settings_pylons)