Eldoret Faces Loss of KES 3.3 Billion in Urban Funding Amid Governance Gaps

 

Eldoret City is at risk of losing KES 3.3 billion in performance-based funding under the Kenya Urban Support Programme Phase II (KUSP II) after failing to meet key governance and institutional requirements for the second Annual Performance Assessment (APA 2). A confidential technical review by KUSP II experts indicates that the city has not complied with several mandatory conditions, placing it on the verge of disqualification in the upcoming allocation cycle. The situation has raised concerns among development analysts and residents, who fear the loss of vital funds could slow urban development and affect the city’s long-term growth trajectory.

At the heart of Eldoret’s challenges is a cascading institutional vacuum that begins at the top and affects the entire governance framework. The city has not established a legally constituted and functional City Board, which is mandated to provide policy direction, approve budgets, and oversee management. The County Public Service Board (CPSB), responsible for recruiting members of the City Board, has also not been formed. Compounding the issue is the absence of a Select Committee within the County Assembly, which is required to appoint the CPSB. This lack of foundational governance structures has left Eldoret unable to meet the minimum conditions required for KUSP II funding. Without a City Board, a CPSB, or a Select Committee, the city’s institutional chain remains incomplete, making it ineligible for the performance-based grants.

The potential financial loss is significant. KUSP II funding is calculated based on population and performance, and with a population of approximately 475,000 residents, Eldoret was set to receive around USD 25.65 million, equivalent to KES 3.3 billion. In addition, the city stands to lose any performance bonuses that may have accrued under the program, pushing the potential total loss closer to KES 5 billion. These funds were intended to support critical infrastructure projects across the city, including road construction and maintenance, stormwater drainage systems, street lighting, market improvements, public spaces, and climate-resilient development initiatives. The forfeiture of this funding would significantly slow planned upgrades and could undermine the city’s aspirations to position itself as a model urban hub in the region.

Complicating matters further is a pending court case challenging the legality of the recruitment process for the current City Manager. A former City Manager filed the case alleging that the CPSB conducted an irregular recruitment. Despite the legal proceedings, the CPSB went ahead to appoint a new City Manager. If the court finds that the appointment was unlawful, the position could be nullified, creating further uncertainty in the city’s top management structure. For KUSP II compliance, having a lawfully appointed City Manager is critical, as performance-based grants require demonstrable adherence to legal and procedural norms. Without resolution, the city’s eligibility for APA 2 funding remains highly questionable.

The governance challenges extend beyond the administrative level and reflect a broader tension between the legislative and executive arms of the county government. The County Assembly has emphasized the need to adhere to legal procedures in the appointment of the CPSB, City Board, and senior management positions. However, the executive has been slow to implement these procedures, resulting in a governance deadlock. This disconnection has amplified the risk of non-compliance with KUSP II requirements, leaving the city vulnerable to losing funding while undermining the credibility of county leadership.

The timing of this governance crisis is particularly sensitive. With the next general election approaching, the loss of funding is likely to have direct political and social implications. Residents are expected to feel the impact in the form of delayed or stalled infrastructure projects, including unpaved roads, congested and poorly maintained markets, inadequate street lighting, and insufficient drainage systems. The absence of visible improvements could reduce public confidence in the county administration and provide political opponents with ammunition to question the leadership’s ability to manage urban development effectively.

Beyond the immediate city limits, Eldoret’s underperformance has broader regional implications. As a commercial and administrative hub, Eldoret serves not only Uasin Gishu County but also neighbouring counties. The loss of KUSP II funding threatens projects that were expected to improve regional transport and logistics networks, upgrade agro-logistics facilities, enhance drainage and flood mitigation systems, and develop non-motorized transport infrastructure. Planned interventions to improve informal settlements and support climate-resilient urban development may also be delayed or abandoned, affecting the wider region’s economic growth and competitiveness.

Analysts warn that unless Eldoret takes urgent steps to address the governance gaps, the city could see billions of shillings diverted to other municipalities that have met KUSP II’s compliance requirements. Immediate measures would need to include the lawful reconstitution of the CPSB, rapid recruitment of a functional City Board, and resolution of any legal issues surrounding the City Manager’s appointment. Without these interventions, Eldoret risks missing out on crucial development funding, slowing urban growth, and undermining its status as a rising urban hub in the country.

The situation also underscores the broader importance of governance and institutional compliance in accessing performance-based development funds. Eldoret’s experience illustrates that failure to establish functional governance structures not only affects immediate financial allocations but also has long-term repercussions on urban planning, service delivery, and regional development. The city’s residents, who stand to benefit most from infrastructure improvements, may soon witness delayed projects and lost opportunities as a result of administrative inertia and legal uncertainty.

Unless there is swift corrective action, Eldoret’s aspirations to modernize and expand its urban infrastructure could be severely compromised, leaving the city at a competitive disadvantage compared to other municipalities that have prioritized governance and compliance. The loss of KUSP II funding may thus mark a significant setback in Eldoret’s journey toward becoming a leading urban centre in Kenya.