Odisha Grants Higher Financial Powers to Urban Local Bodies, Smart City Officials

24 Jul 2026, 09:59 by Vinay Kakkad · KalingaTV

The Odisha government has substantially expanded the financial authority of Urban Local Bodies (ULBs), a move aimed at speeding up civic projects, reducing administrative bottlenecks and granting greater decision-making autonomy to municipal institutions across the state.

The revised framework, notified by the Housing and Urban Development Department, takes immediate effect and replaces all earlier orders governing the delegation of financial powers. The changes apply to municipal corporations, municipalities, Notified Area Councils (NACs), and the Smart City administrations in Bhubaneswar and Rourkela.

One of the key changes places the Managing Directors of Bhubaneswar Smart City Limited (BSCL) and Rourkela Smart City Limited (RSCL) on par with commissioners of municipal corporations in terms of financial authority, enabling them to approve and process expenditure within the revised limits.

For municipal corporations, commissioners can now clear works bills, purchase bills and office contingent bills worth up to ₹1 crore. Earlier, the ceiling stood at ₹50 lakh in the Bhubaneswar Municipal Corporation (BMC) and ₹15 lakh in other municipal corporations. Expenditure beyond ₹1 crore will continue to require approval from the respective municipal corporation. Commissioners have also been vested with full authority to process salary and pension payments.

The government has also revised the limits for administrative approval of development works. Municipal corporation commissioners can now sanction projects worth up to ₹3 crore, compared with the previous cap of ₹2 crore.

Under the new approval structure, projects costing more than ₹3 crore and up to ₹4 crore will be examined by the Standing Committee on Contracts. Works valued above ₹4 crore and up to ₹5 crore will require approval from the municipal corporation, while proposals exceeding ₹5 crore will continue to be referred to the administrative department.

Significant changes have also been introduced for municipalities and Notified Area Councils.

The financial authority of Executive Officers to pass payment bills has been doubled from ₹10 lakh to ₹20 lakh. Bills exceeding ₹20 lakh must now bear the joint signatures of the Executive Officer and the Chairperson. Like municipal commissioners, Executive Officers have also been granted unrestricted powers to approve salary and pension payments.

The limit for granting administrative approval to works and projects in municipalities and NACs has similarly been increased from ₹10 lakh to ₹20 lakh.

Projects valued above ₹20 lakh and up to ₹3 crore will be approved by the Municipal Council or the NAC, while schemes exceeding ₹3 crore will continue to require clearance from the Housing and Urban Development Department.

According to the Housing and Urban Development Department, the revised delegation of financial powers is intended to strengthen urban governance by giving local institutions greater fiscal autonomy. The government expects the changes to reduce procedural delays, improve administrative efficiency and ensure faster execution of civic infrastructure and public welfare projects across Odisha.