ADVOKS GLOBAL · KENYA
Public Finance Management Act
173. Criteria for allocating funds to urban areas or cities by county governments
Edition: 2026-09-25 · In force
173. Criteria for allocating funds to urban areas or cities by county governments
(1)In allocating funds to the urban areas or cities under section 172(b), the county government shall use objective criteria reflecting the service demand and responsibilities of the urban area or city.(2)The objective criteria to be prescribed in county legislation, may include, among others, adjustments for—(a)the proportional population, calculated as the population of the urban area or city divided by the total population of the county;(b)the relative area, calculated as the area of the urban area or city divided by the total county area;(c)the relative poverty levels based on objective measures of relative poverty;(d)the relative per capita revenue collection estimated as urban area or city per capita revenue collection divided by the County per capita revenue collection;(e)an objective measure to account for price differentials in providing similar services in the urban area and city relative to the rural areas of the county;(f)a minimum amount to ensure effective delivery of essential services and responsibilities assigned to the urban area or city; and(g)incentives to encourage urban areas and cities to exercise prudent financial management as well as transparency and accountability in public financial management.(3)In approving the criteria in subsection (2), the County Assembly will seek the recommendations of the Commission on Revenue Allocation.