Bihar Cabinet approves allocation of ₹9169 crore for ULBs

Bihar Chief Minister Samrat Choudhary. | Photo Credit: ANI The Bihar Cabinet on Wednesday (September 2, 2026) gave its nod for allocation of ₹9,169 crore for all the Urban Local Bodies (ULBs) of the State for a period of four years in the light of 16th Finance Commission.The ULBs will receive the amount as a basic grant and performance grant in the State for the financial years 2026-27 to 2030-31.Talking to reporters after the cabinet meeting, Urban Development and Housing Department Minister Nitish Mishra said that the term of the Government of India’s 15th Finance Commission ended on March 31, 2026. The State cabinet today approved the allocation of funds for all urban local bodies to be distributed under the 16th Finance Commission, he added.Stating that ₹9,169 crore has been approved for 264 urban local bodies of Bihar over the next five years, Mr. Mishra said that two key changes have been introduced between the 15th Finance Commission and the 16th Finance Commission.About 90% of the funds are still allocated based on population criteria while 10% of funds will now be allocated on performance based criterion, the Minister said adding that earlier in the 15th Finance Commission, 10% of the funds were allocated based on area (geographical size).This means urban bodies that perform better or mobilise their own resources will be eligible for additional funds,” he said.Besides, two other broad changes have been made that include a provision for converting new areas into towns. First, a one-time grant of ₹2,000 per person will be given if more areas are brought under ULBs and urbanisation increases in the State, Mr. Mishra said adding that this incentive for urbanization will benefit the State as urban local body areas expand.Second, ₹5000 crore has been earmarked under a Special Infrastructure Component from which Patna Municipal Corporation can benefit for waste water management projects. Of the amount, 60% will come from the Central Government.Out of ₹9,169 crore, 50% must be spent on waste management or water management while the ULBs will have the autonomy to spend the remaining 50% amount across 18 identified functional departments over the next five years.In yet another decision, the State cabinet gave its administrative approval for an estimated expenditure of ₹30.94 for obtaining consultancy services for the preparation of road user fee structures, collection and monitoring of user fees on State-owned roads, bridges, and other structures, Additional Chief Secretary Cabinet Secretariat Department Arvind Kumar Chaudhary told reportersIt also includes road user fee collection contracts/Toll-Operate-Transfer (TOT) projects, networking/bundling of projects, and other related works, he added.The State government would collect toll (Road User Fee) on 47 State-owned bridges having a length of more than 250 metres and 55 State Highways in the first phase, Mr. Chaudhary said.The cabinet also approved the cabinet secretariat department’s proposal to observe the martyrdom day of Ramphal Mandal and Pandit Rajkumar Shukla every year on August 23 as a State-sponsored ceremony in Sitamarhi and West Champaran, respectively, Mr. Chaudhary said.A total of 27 decisions were taken at today’s cabinet meeting chaired by Chief Minister Samrat Choudhary. Published - September 03, 2026 10:50 am IST