Mining communities could soon have greater control over development projects after the government proposed new regulations that set aside part of mineral royalties for areas where extraction takes place.
The proposed Mining (Mineral Royalty Sharing) Regulations, 2026, also introduce stricter measures on how the money will be received, managed and accounted for as Parliament considers the new rules.
The regulations are designed to implement Section 183 of the Mining Act by providing a clear system for the collection, distribution and management of mineral royalty payments. They also define how the funds will be shared among the national government, county governments and communities hosting mining activities.
If approved, communities where minerals are extracted will receive 10 per cent of all mineral royalties, with the money going towards projects chosen by local residents.
“The 10 per cent share of royalties payable to communities shall be used to facilitate projects identified by the community,” the regulations say.
The proposed rules require communities to identify the projects through a public participation process before any money is spent, ensuring the funds are directed to priority development needs.
The revenue-sharing formula gives the national government 70 per cent of the royalties collected, while county governments will receive 20 per cent. The remaining 10 per cent will go to host communities.
To manage the funds, the Principal Secretary for the State Department of Mining will establish a Mineral Royalties Collection Account once approval is granted by the National Treasury.
The regulations also provide for the opening of a Community Mineral Royalties Account to hold the community allocation in trust. Separate accounts will also be created for every community entitled to receive the funds.
Mining companies will continue remitting royalties to the government. After the payments are received, the State Department of Mining will prepare quarterly schedules indicating the amount collected and how it will be distributed to each beneficiary.
The quarterly schedules will also be published on the ministry's website to make the process more transparent.
The proposed regulations further establish Community Mineral Royalty Management Committees that will oversee the planning and use of the community allocation.
Each committee will include the deputy county commissioner where the community is located, the subcounty administrator, the county mining officer, representatives of women, youth, persons living with disabilities and village elders. The county mining officer will serve as the committee secretary.
“The members shall serve for a period of three years and they may be re-appointed only once for a further term of three years,” the regulations state.
The committees will identify development priorities, approve projects, monitor their implementation and help resolve disputes that may arise during the execution of the projects.
“The committee shall ensure that the projects... are well planned, evaluated, monitored and based on the actual needs of the community,” the regulations said.
Before projects are approved, communities must first identify them through public participation. The committees will then rank the proposals and prepare annual work plans for approval.
The regulations also strengthen financial accountability by limiting committee operating expenses to three per cent of the community's royalty allocation, leaving the larger share available for development projects.
Committee secretaries will be required to submit quarterly reports outlining procurement activities, spending, project progress and any unspent funds. They will also prepare annual accounts for submission to the Auditor-General as part of the oversight process.