President Uhuru Kenyatta on Tuesday signed into law the Division of Revenue Bill 2019, paving the way for the release of funds to counties.
The new law allocates Sh378.1 billion to county governments for the 2019/20 financial year.
Out of the total allocation, Sh316.5 billion is the equitable share of national revenue while Sh61.6 billion are conditional allocations to the devolved units.
The total allocation of Sh378.1 billion to county governments represents 36.46 percent of the audited and approved revenue of the National Government for the financial year 2018/19 against the constitutional threshold of 15 percent.
The National Treasury has already disbursed over Sh50 billion to counties for the months of July and August.
On Monday, there were fears that the financial crisis facing county governments would be prolonged after the two Houses of Parliament differed on the commencement date of the Division of Revenue Allocation Bill.
The bill was inked two weeks ago after the Senate agreed with the National Assembly to a proposed allocation following months of a protracted standoff over the counties allocation.
Senators accused National Assembly members of backdating the new bill to July 1, 2019, instead of the commencement date being the on the gazzettement day.